Iowa Democratic Presidential Debate 12-13-07

The consensus was that John Edwards won this debate; although, like the Republican debate, it was relatively cordial. Edwards might have saved his candidacy by this debate performance. As with the Republicans yesterday, the debate begins with a question about the budget:

WASHBURN: Would it be a priority of your administration to balance the federal budget every year? If yes, how? If no, why not?

[...]SEN. BARACK OBAMA, D-ILL.: Over the last seven years, what we've seen is an economy that's out of balance because of the policies of George Bush and the Republicans in Congress.

Not only do we have fiscal problems, but we've got growing inequality. And so people are working harder for less and they're seeing costs from everything from college education to health care to gas at the pump go up.

So what I want to do is get the long-term fundamentals right. That means that we are investing in education, we're investing in infrastructure, we're getting our trade deals structured so that they're fair, and that we are also ending the war in Iraq where we're spending $10 billion to $12 billion a month. That is money that can be applied back here at home for critical issues.

Now, the fact is that we're not going to be able to do this unless we're able to overcome some of the special interests that have clogged up the system and created trillions of dollars worth of tax loopholes and tax breaks.

OBAMA: We need to put those tax breaks and tax loopholes back into the pockets of hardworking Americans.

WASHBURN: And so, just so I'm clear, a priority to balance the federal budget, or not necessarily?

OBAMA: We are not going to be able to dig ourselves out of that hole in one or two years. But if we can get on a path of sustained growth, if we can end the war in Iraq, end some of the special interest loopholes and earmarks that have been clogging up the system, then I think we can return to a path of a balanced budget.

[...]FORMER SEN. JOHN EDWARDS, D-N.C.: OK. Thank you very much.

Well, first of all, what we have to do is get rid of the structural deficiencies in the American economy. And we have to create jobs, protect American jobs. We have to strengthen and grow the middle class, which is struggling mightily in this country today.

And one of the reasons that we've lost jobs, we're having trouble creating jobs, we're having trouble growing and strengthening the middle class is because corporate power and greed have literally taken over the government.

And we need a president who's will to take these powers on. It is the only way we're going to strengthen and grow the middle class, have universal health care, have a trade policy that actually works for American workers, have a tax policy that's not favoring big multinational corporations, but instead favors the middle class and working people.

SEN. HILLARY RODHAM CLINTON, D-N.Y.: Well, fiscal responsibility is a very high priority for me. We don't have to go back very far in our history, in fact just to the 1990s, to see what happens when we do have a fiscally responsible budget that does use rules of discipline to make sure that we're not cutting taxes or spending more than we can afford.

CLINTON: I will institute those very same approaches.

You can't do it in a year. It'll take time. But the economy will grow again when we start acting fiscally responsible. And then we can save money in the government by cutting out private contractors, closing loopholes, getting the health care system to be more efficient.

We'll do all of this at the same time, but the results will take awhile for us to actually see.

[...]EDWARDS: Well, I just want to add one thing to what Governor Richardson just said. I think the truth of the matter is that the tax policy in America has been established by big corporations and the wealthiest Americans.

That's why we have tax breaks for the top 1 percent and 2 percent. It's why the profits of big corporations keep getting bigger and bigger, while most working middle-class families are struggling.

So what we ought to be doing instead is getting rid of these tax breaks for big -- the wealthiest Americans -- big tax breaks for companies that are actually taking American jobs overseas.

This is insanity, when we're losing American jobs at the rate we are today.

And then, on top of that, we need to help middle-class families. I have proposed specific ideas to help them save, to help them send their kids to college, and to make sure that thy can pay for child care.

EDWARDS: All of these things are aimed at making sure that we have -- that we strengthen the middle class, that we can pay for things like universal health care -- I mean, you can't have universal health care, to be honest with people, unless you have a way to pay for it, and this is how we pay for it.

WASHBURN: Senator Clinton? Thirty seconds.

CLINTON: Well, I think it's important that we recognize how people feel in Iowa and across America. They feel as though they're standing at on a trap door. They are one pink slip, one missed mortgage payment, one medical diagnosis away from falling through.

I want to restore the tax rates that we had in the '90s. That means raising taxes on corporations and wealthy individuals. I want to keep the middle class tax cuts. And I want to start making changes that will actually save us money -- save us money in our Medicare budget, save us money for the average American.

You know, during the '90s the typical Iowan family's income rose $7,000. We can get back to fiscal responsibility and economic growth again.

So if we assume that we'll continue to have some military expenses in Iraq for many months, how will you pay for your new ideas in the short term?:

OBAMA: Well, every proposal I've put forward during this campaign, we have paid for. And we have specified where that money is going to come from.

But let's just look at our tax code, because it's a great example of how we could provide some relief to ordinary citizens who are struggling to get by.

Right now, we've got a whole host of corporate loopholes and tax savings. There's a building in the Cayman Islands that houses, supposedly, 12,000 U.S.-based corporations.

OBAMA: Now, that's either the biggest building in the world or the biggest tax scam in the world. And I think we know which one it is.

If we close some of those loopholes, that helps me to pay for an offset on the payroll tax that effects all Americans.

We've put forward tax relief plans for those that are making less than $75,000 a year. That will not only restore fairness to our tax code, but it also puts money into the pockets of hard-working Americans who need it right now, who will spend it, and it will actually improve our economic growth over time, particularly at a time when we're seeing a credit crunch.

But what it requires is some leadership from the White House that restores that sense that we're all in this together and that we're not just on our own.

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