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Harkin Explains 'No' Vote On 'Fiscal Cliff' Deal

Jan 1, 2013
Originally published on January 8, 2013 2:19 pm



This is ALL THINGS CONSIDERED from NPR News. I'm Audie Cornish.

It looks like House lawmakers will take action on a compromise bill to avert the fiscal cliff. Early this morning, the Senate approved a compromise deal hammered out by Vice President Joe Biden and Senate Minority Leader Mitch McConnell. Now, it appears the House may follow suit, or at least they'll try. An up or down vote is scheduled later tonight.

The proposal would postpone deep spending cuts scheduled to take effect as part of the fiscal cliff and would let the Bush-era tax cuts expire on family income above $450,000. What's unclear is just how many House Republicans will balk at the deal and how many House Democrats will provide the votes needed to approve it. Even in the Senate, where it passed 89-8, there were lawmakers unhappy with it. Earlier, I spoke with one of those senators, a Democrat who voted against it.

Senator Tom Harkin of Iowa, welcome to the program.

SENATOR TOM HARKIN: Audie, it's nice to be with you today.

CORNISH: So tell us, what was the argument that Vice President Joe Biden made to Democrats last night? Why did it convince so many of your colleagues in the Senate to vote yes on this but not you?

HARKIN: Well, I think Vice President Biden made an impassioned plea that this is the best deal we could get. They worked hard on it. There were good elements in it. We just can't go over the cliff because it will destroy the markets and everything will just go to heck and we can't put it back together again and on and on and on and on. And then a lot of our fellow senators got up and spoke. Senator Kerry spoke about how this would impact us around the world and that kind of thing. So there was quite a pressure put on a lot of senators.

CORNISH: And yet you voted no. Why?

HARKIN: Well, I voted no because of three basic reasons. One, it does not address the number one priority that we have in this country. And the number one priority is creating good jobs and putting people back to work. It's like, ever since the election, we forgot that we still had well over 7 percent unemployed in this country. So the thing that's holding back our economy is the fact that people aren't working.

CORNISH: And the other two reasons?

HARKIN: The second reason, it doesn't generate enough revenue that's needed to invest in the things like infrastructure, education, job retraining, research and development that will get the engine going again. And the third reason is because it's so discriminatory. All of the tax benefits that go to rich people and the high-income earners are made permanent. The tax benefits that we Democrats put in in 2009 to help modest-income people, those are made temporary. To me, that just stands logic on its head.

You should make the things that help modest-income earners permanent and the things that help high-income earners temporary. Vice President Biden and everyone in their speech, I think, kept referring to 400,000 as middle class. Well, if you're making $400,000, you're in the top 1 percent of income earners in America. So have we defined the new middle class as people making $400,000 a year?

CORNISH: But if this vote in the Senate had failed, Vice President Biden and others says that it could have sent the country back into recession, and Americans across the board would have been hit with this one-two punch of a hike in both the income tax and the payroll tax. So given that, how do you explain to your constituents your willingness to let that happen?

HARKIN: Well, I explain that I don't believe it. I don't think there's any empirical evidence whatsoever that shows that. In fact, many people, including Warren Buffett and a lot of others, have said the market's already discounted that. Now, the fact is if we had gone beyond, say, March, perhaps past the first quarter and not done something, things might start to unravel, but not today or not in the first week, not in the first month, not in the first couple of months. And, you know, it's the same kind of panic button that people push to get things happen sometimes.

I remember the TARP and the bailouts and all that, you know, that things were just going to fall apart unless we did something, and in retrospect, it just wasn't true. And I don't think it's true that the country would have gone to heck and everything would have crashed if we hadn't passed that bill last night. I think just the opposite is true. If you look at the other side of the ledger, had we not passed this and we've gone into this sequester and everything and the tax rates had gone up, we would have $4 trillion over the next 10 years in new revenue.

That means the deficit would come plunging down. That sends strong signals to the market also. So there's another side of that ledger that not too many people spoke about.

CORNISH: But it also would have meant $110 billion a year in spending cuts across the board, many to programs that you value as well.

HARKIN: Well, not again. That wouldn't have happened on day one. The sequester means you have to do it by the end of the year. There were plenty of gimmicks to be used and things to keep from cutting everything right now to give us time to work in January and in February to come up with a balance between spending cuts and revenue increases. I think what we have done as Democrats is we've given away all the revenue. And just as Mitch McConnell said last night on the floor, now we're going to go after spending. What bargaining do we have?

Paul Krugman, I think, said it best in his blog last night. He called President Obama the world's worst poker player. He just gave all of our bargaining chips away. I don't know what we have left to bargain with Republicans on now.

CORNISH: The White House has reportedly made assurances that President Obama will be tougher in future negotiations. It sounds like you don't believe that.

HARKIN: Well, I can only look at the past to make a judgment on that.

CORNISH: Senator Tom Harkin, thank you so much for speaking with us.

HARKIN: Thank you, Audie.

CORNISH: That's Senator Tom Harkin of Iowa, one of three Democrats who opposed the fiscal cliff deal in a vote early this morning. It passed the Senate 89-8. Transcript provided by NPR, Copyright National Public Radio.