Political posturing on fiscal negotiations

>>> good morning from new york. i'm steve in for chris hayes who will appear later in the program interviewing dan savage . it's about dan's marriage in washington state . they are one of the couples getting married there. after voters extended marriage rights to same-sex couples by popular vote last month. we have david johnston , the author of "fine print." he's a pulitzer prize winning tax writer at new york times and now at the college of law . we have the president and ceo of the center of american progress who served in the obama and clinton administrations, policy director of hillary clinton 's campaign. laura flanders , founder of grittv.com. the editor of salon.com and the woman who hired me two years ago. thanks, as always for that.

>> of course.

>> anyway, on friday afternoon, house speaker john boehner attempted to paint a picture of white house negotiations and how to avoid going over the fiscal curve. i have been saying fiscal slope. now on the show, i'll go with curve.

>> this isn't a progress report because there's no progress to report. four days ago, we offered a serious proposal basedtestimony from presi dent clinton's former chief of staff. there's been no counter offer from the white house . instead, reports i understand kate the president adopted a deliberate strategy to slow walk the economy to the edge of the fiscal cliff.

>> the extremely vague republican proposal did not include an increase in tax rates a position he reiterated on friday making clear there's no movement on the white house 's red line on treasury secretary tim geithner as he was asked about it wednesday.

>> the administration's position when it comes to raising taxes on the wealthy. making more than $250,000. if republicans do not agree, is the administration prepared to go over the fiscal cliff?

>> absolutely.

>> there's no agreement that doesn't involve the rates going up on the top wealthy 2%.

>> republicans clinging to what little leverage they have to maximize cuts zeroed in on the debt ceiling hoping for a repeat of the 2011 showdown where house republicans were able to extract $2 trillion in cuts. $1 trillion cut from domestic programs in ten years and $1.2 trillion in cuts through a sequester. wednesday, president obama seemed to set another red line , a business round table who warned against the repeat of last year's debacle.

>> i want to send a clear message . we are not going to play the game next year. if congress suggests they are going to tie negotiations to debt ceiling votes and take us to the brink of default, once again, as part of a budget negotiation, which by the way, we have never done in our history until we did it last year, i will not play that game. because we have to break that habit before it starts.

>> so, "the washington post " made a point friday saying you have two tracks here. you have the public posturing, comments like that from obama and boehner. you have inside washington , behind closed doors , he thinks the foundation of a deal may be shaping upright now. what he laid out, ezra is reliable because he's plugged into the administration. he laid out a deal where republicans give in on the tax rates but not the 39.6%. maybe the 37%, about half way in exchange for that. he's saying white house would give in something on entitlements specially on medicare eligibility, raising it by two years. david , if that's the framework, what is your response?

>> this is a total betrayal for the people who voted for obama . it's what a lot of people have been worried about. people who make $100 million a year salary, 80 of them in the country pay the same rate as someone who makes $40,000. there should be more tax rates . secondly, raising the medicare age, it's a terrible thing to do. it doesn't save money, it costs money. for people who don't have office jobs like we do, it's a death sentence for them. this is awful. obama won by 5 million votes. 3 million vote margin for bush in 2008 . a margin of one in 2000 where he lost the popular vote and the republicans are saying the man has a mandate. we must give him what he wants. i'm sorry, he has a mandate, do what it is. people have been calling on the phone and writing saying stand firm or we'll put other people in next time around.

>> we were talking about this before. i wonder, is there a way of looking at this where it's part of the political process, part of the negotiating process where this gets leaked, put out there and it may not be the white house 's intent?

>> i certainly hope so. i think there's reason to think that. i agree with david , people need to make noise about this. mitt romney even ran on raising the eligibility age, let alone president obama . nobody ran on that because it's a, political poison and b a terrible idea for the reasons david stated. there's no other hand on that issue. this is a political negotiation. one day you have tim geithner saying they are prepared to go over the fiscal cliff. the same day, the white house is meeting with latino groups the next day african-american groups saying why it's terrible to go over the fiscal cliff. you have negotiation on many tracks.

>> i like to talk about why raising medicare age is a bad idea. first of all, really, what it is is a shift of cost from the federal government to employers, seniors and states. in fact, because medicare is cheaper for beneficiaries, it's increasing. a president who ran on lowering national health care cost, it was one of the reasons why we have the affordable care act . it's when you increase the costs for everybody, and we'll cut out hundreds of thousands of seniors. the seniors are the hardest to ensure. you are raising costs of the medicare program, shifting costs to employers because they have to shift costs. it's making us less competitive. i don't understand --

>> what they are saying, what the signal the white house and its allies on this front would be sending out there is they say jonathan wrote this, there's important symbolic value.

>> nonsense.

>> but, let me -- the point i want to make here is, this is what they say. i wonder how we got into this mess in the first place.

>> if we are talking political and efforts to send out messages, this will only create the kind of reaction we need to shoot this idea down. if people get put into this picture, we are talking numbers, politics, power in washington, we need to talk people. i am, right now, paying for a mortgage and the private health insurance of my sister-in-law who worked 20 years in a metal factory in michigan, one of the few remaining. she retired the minute she could. she worked her little fingers to the bone making shelves for walmart. she retired after 20 years. her wages went from $5 an hour to $10 an hour. she was not able to get medicare . she was 62. she's waited every month to get closer to 65 to get that help.

>> lower the age of medicare to 55. make that the bargaining point.

>> that's my point. when i was envoking the idea of the symbolic idea, how did it get to the point where the white house feels there's such --

>> they are not proacting.

>> there's a term that greg from "the washington post " came up with. the idea is republicans have been making noise for the last few years about the deficit. democrats have mimicked the noise. yes, we have a huge deficit problem. you get in public opinion polls , overwhelming majorities say yes. they look at the polls and respond to it. something similar happened on medicare . we have the notion of there's a medicare crisis. there's an entitlement. this is a health care crisis.

>> i really need to say about jonathans piece. i am liberal, but that is the worst example i have heard. take people out of a popular -- i hope this is not the white house position. take people out of a popular program that works and they love, put them into obama care that is not so popular and they don't necessarily love. take away something they like and give them something liberals think they should like.

>> the right question is, the portuguese have an average income lower than ours with universal health care . it costs two-thirds of their economy compared to our economy. we are having the wrong discussion. here is the program. start by lowering medicare is an option to 55 or 40. stop reacting to what --

>> we'll have to continue the next one because we have a question here. who is arguing to extend all the bush tax cuts is next.