FOX News "Your World" - Transcript

Interview

FOX NEWS CHANNEL "YOUR WORLD" INTERVIEW WITH REP. CHRIS VAN HOLLEN (D-MD) INTERVIEWER: NEIL CAVUTO
SUBJECT: TAX CUTS

MR. CAVUTO: Microsoft leaving the Dow lower. The software giant for the first time ever is slashing jobs, about 5,000 of them, up to 6,000 at Intel. Democrats using the news to make an emergency push for their own massive spending plan. House Speaker Nancy Pelosi calling it a crucial first step to get those jobs back. Is it? Democratic Congressman Chris Van Hollen of Maryland says it is.

Congressman, good to have you. What kind of figure do you think we're talking about now, Congressman?

REP. VAN HOLLEN: We're talking about $825 billion package. It's about $325 billion in tax relief both to individuals and for business tax incentives. And the remainder is for investments in infrastructure, roads, bridges and also the new infrastructure of the 21st century, whether it's trying to build out the electric grid or incentivize things like clean energy, wind, solar, that kind of thing.

MR. CAVUTO: All right. But I know inherent in this is to try to get more jobs, right? What I'm wondering about, sir, is whether 44 million (dollars) to repair and improve the Department of Agriculture headquarters is a step in that direction or 276 million (dollars) to modernize the State Department is a step in that direction. Is it?

REP. VAN HOLLEN: Well, I think if you look at the infrastructure program, the idea was to begin infrastructure projects that we need to do to begin to do it now. In other words, if you've got a construction project you know you're going to have to do in the next couple of years, now is the time to do it. You want to try and front load those things to help put people back to work. You just recited the most recent numbers. We saw a half million Americans lose their jobs in December, a half million again before that in November.

MR. CAVUTO: No, no, Congressman, I'm not dismissing the severity of some of these numbers. I'm dismissing whether the numbers I'm looking at here are going to do anything to improve them. Four hundred million dollars worth of repairs for nationalizing or revitalizing the National Mall, a little bit more than 6.2 billion (dollars) to weatherize homes, 2 billion (dollars) for daycare services, cable TV converters 650 million (dollars) for that. What in Lord's name is that going to do to create any economic activity?

REP. VAN HOLLEN: Well, let's just take childcare services. Those are on military bases around the country. This has been a priority, a goal of many members, Republicans and Democrats for a long time to make sure that our military personnel who are serving this nation have a safe and secure place for their kids during the day.

MR. CAVUTO: But why would you call that part of a stimulus plan?

REP. VAN HOLLEN: Because it's to build a childcare center. In other words, you need labor, you need people, you need material to get it done. So why not front load it now? That's the whole idea here is there are lots of projects that have been in the pipeline, on the planning boards, and we're saying, let's get it now. This is when people are out of work, a lot of people in the construction industry, obviously, out of work because of the housing market is way down. Let's get those people to work -- roads, bridges, buildings.

MR. CAVUTO: But are you troubled, Congressman, when your own Congressional Budget Office says one out of 10 dollars appropriated for this sort of stimulus is going to make its way into the economy in the next two years. That means nine out of 10 are not. And what it goes on to say is that much of the green technology push that you're prioritizing isn't going to be felt until 2011 until 2012 at the earliest, that a lot of Americans are going to be scratching their head, even those that like green technology, sir, and start saying, we need immediate bang for the buck, if you buy the fact this could do that, and we're not getting it.

REP. VAN HOLLEN: Neil, we're looking at ways to front load more of the spending, to try and pack more of it into the first two years. We have, for example, a provision that penalized those states that couldn't get their contracts on the streets and ready to go in 90 days. We were then told that would actually be a disincentive because it would just be impossible for some of them to move that quickly.

So we are going to continue to try and refine this bill as it goes on to try and make sure that more money is spent up front. But let's take a construction project, for example. You want to get it started, but it may be more than a two or three-year project, I mean, especially the larger projects as opposed to just road resurfacing. And so you don't want to disincentivize somebody who has a bigger project from beginning it today. You want to provide them an incentive to start today.

MR. CAVUTO: I see your point, sir. But one man's worthy project is another man's version of pork, I guess. And I know you guys want to sort that out. But I what I guess I'm asking here is the tax cut portion -- and I know some conservatives have argued they're not really tax cuts; credits maybe, but not tax cuts -- but whatever you call it Congressman, that portion of this stimulus package, now at around $325 billion, has gotten smaller and smaller and smaller. So people are beginning to ask this is going to be spending heavy, tax- cut weak. What do you say?

REP. VAN HOLLEN: Well, I think if you look at the overall package, the tax cut provisions are a substantial amount. They are 325 billion (dollars) in the House. They may well grow as we go on. We want to -- there is some room in here, especially on the tax side but also perhaps on the spending side, for a little bit of growth. Although there is also a concern, as you know, not to make this too, too big.

And so we're going to have to see how this progresses. But the tax cuts -- and I should report that we just passed this in the Ways and Means Committee less than 15 minutes ago, the tax portion of the recovery plan -- $325 billion is a big, healthy round of tax cuts, both for individuals as well as for business incentives. There is bonus depreciation in here for businesses. There's net-operating-loss relief for businesses. So I think there's a lot of tax relief --

MR. CAVUTO: But to be fair, you do have a lot of goodies in there for business, which might stimulate hiring and that sort of thing. But to be fair, Congressman, a lot of the tax cuts you're talking about are for people who don't pay income taxes.

REP. VAN HOLLEN: Well, they're for people who pay FICA taxes. In other words, these are for people who are paying their Social Security taxes, they're paying their Medicare taxes, they're working Americans. These are people who are getting up everyday and going to work.

MR. CAVUTO: No doubt, no doubt. But the people who are paying income taxes are going to look at this and say, what the heck?

REP. VAN HOLLEN: Well, the people who are paying income taxes are going to get income tax relief, and they're going to get tax relief under this plan as well. I mean, it helps 95 percent of working Americans.

MR. CAVUTO: Yeah, but those other guys are going to get both, right?

REP. VAN HOLLEN: Well, what they're going to get -- if you're paying Social Security taxes and you're paying Medicare taxes, you're also going to get some relief under this bill. That's correct. I mean, that is similar to tax incentives we have with respect to the EITC for the working people, people who are getting up, working hard to try and, as Obama has said, make work pay.

MR. CAVUTO: I understand. All right, Congressman Van Hollen, thank you very much. Very good having you.

REP. VAN HOLLEN: Good to be with you, Neil.

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