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MATTHEWS: And this guy is a political loan shark. Anyway, the majority of Americans want to see tax rates go up on the rich, but will Norquist convince enough Republicans that it`s better to dig in their heels than to reach a compromise? Tom Coburn is the Republican senator from Oklahoma and Joe Klein is a columnist for "TIME." Gentlemen, thank you. Mr. Coburn, Senator Coburn, I don`t want to abuse your presence. I honor it. My children, by the way, think you`re the greatest.
MATTHEWS: So let`s talk about this. I have a couple kids, one who worked
on the debt commission and another one who just loves you for some reason.
So, let`s find out why.
It seems to me, if you look at the numbers, just arithmetic here, right
now, the government is taking in 15.7 percent of the GDP in the current
fiscal year and spending 22.9 percent of the GDP. Common sense tells us if
we`re going to get to 20, it seems like getting maybe to 20, maybe some
liberals want a bit more, conservatives want a bit less. You have got to
come in both directions. Your thoughts?
SEN. TOM COBURN (R), OKLAHOMA: Oh, I agree. The problem, Chris, is we haven`t had long-term thinkers in Congress for a long time. And if you really look at it, the last 30 years, we have lived off the next 30. And the bill is due. I think the question is, is any combination that gets us out of the problem that -- and onto a road of recovering our economy and recovering the future for our kids is a good combination.
But the point has to be is -- is, there`s no question we can have the rich
pay more, but that won`t solve our problem, and with that comes negatives.
MATTHEWS: I agree.
COBURN: The real problem is, is you got an entitlement system that`s out of whack, and the demographics are exaggerating that. And you have had discretionary spending increases.
You know, the budget of this country this year is twice what it was 11 years ago, and a good portion of that is discretionary. Some of it, $100 billion a year, is the war, but the rest of the government has grown. So we have to do both. And we have to make sure that whatever we do does not hurt us, but gets us on the way to recovery.
MATTHEWS: Let me get to Joe Klein on the politics of this. My contention is, unless the liberal caucus led by Nancy Pelosi, a huge majority of Democrats who are hard-core liberals, unless they see teeth marks in the neck of Eric Cantor and Boehner, unless they see the president has really gone in there and raised taxes on the rich, done something significant, maybe not the 39.6 percent, but something that clearly bothers those people, she ain`t getting nothing -- she`s not giving anything from her end.
You have got to be tough on the tax front if you`re going to get any action
really along entitlement people. Your thoughts. That`s my view.
JOE KLEIN, COLUMNIST, "TIME": Well, I think that that`s true, although I
think that what you`re going to have here is a centrist coalition where the
Republicans in the House are going to drop their Tea Party supporters, and
the Democrats may have to drop some of their more extreme, you know, the
people who think that we should have...
MATTHEWS: Does that get you 218?
KLEIN: Yes. You can...
MATTHEWS: Does that get you 218?
KLEIN: Of course.
Boehner could have gotten there if he`d been willing to drop the Tea Party two years ago. I think that you will see a small uptick in marginal rates, but you`re going to see haggling.
KLEIN: This is the return of politics. And by the way, you have been saying there`s only one House Republican who is for this. You know, Pete King just said it, but Scott Rigell from Virginia took a courageous stand last year and defied Grover Norquist, and there are others. I mean, Cantor is wavering now and I think that the handwriting is on the wall.
MATTHEWS: Is this going to have to come through the leadership, this deal on revenues, to basically challenge Norquist and the rigidity here, Senator? Or can it be done around the edges where you have 100 votes from both sides of the aisle and 50 votes from a combination of the Democrats and Republicans in the Senate? Does it have to go through McConnell, Boehner, Eric Cantor, et cetera?
COBURN: Well, there has to be a compromise. And the compromise has to be -- you know, I disagree with you on rates because I think rates ultimately hurt us. Reforming the tax code where the wealthy actually pay more would actually help us collect revenues and also stimulate the economy. And we shouldn`t lose sight of that --
COBURN: -- because we did that under Reagan with Tip O`Neill and several others. We actually accomplished some great things for our country where we had economic growth in excess of 4.8 percent for over four years.
COBURN: So we shouldn`t lose sight of the fact -- I don`t care which
way it comes. But I think the important thing is to protect all the things that are true. It is true we have a demographic problem and an entitlement problem.
It is true some of the very wealthy are very well-protected in terms of the tax code. We need to eliminate that. It is true there`s going to come a point in time where we can`t borrow any more money and interest rates are going to skyrocket. So, we need to merge all three of those. We need to leave our hats
in terms of our partisanship outside and come in and solve the problems for
MATTHEWS: I agree with you on the arithmetic. And, Joe, that is the problem. We`re talking demographics here, not Democrat versus Republican, but younger versus older. We are going to have so many older people depending on these programs, compared to maybe two worker bees to every retiree bee. That`s going to be tough for the kid who`s working in their 20s, young couple trying to pay enough payroll taxes to meet the needs of -- the living conditions and needs of a family in their 70s and 80s.
KLEIN: I think, Chris, we have some real opportunities here now, because Obamacare is going to be the law of the land. And if we have universal health insurance, if everybody is covered, then you can raise the retirement age for Medicare. Then you can have a system where, you know, you can go up to 70 years old if -- if -- the Republicans cooperate and really force a system of health care exchanges, these health care super stores where you have real competition and you can drive down the premiums that are charged to individuals and small businesses. I mean, we`ve got -- we have a real opportunity here. This is a great moment and, you know, I congratulate the senator for -- you know, for the pioneering work that he`s done on this issue in the past.
MATTHEWS: You know, we have to go. But, Senator, I do want to congratulate you for voting for Simpson-Bowles. You and people like Dick Durbin, I have tremendous respect for you to stick your neck out and say something that a lot of politicians won`t do. This isn`t perfect but it`s where we have to go. We have to solve this problem. Thank you so much for coming on.
COBURN: Thank you. You bet
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