ROMNEY: Jim, the president began this segment, so I think I get the last word. (CROSSTALK)
LEHRER: Well, you're going to get the first word in the next segment.
ROMNEY: All right. Well, but he gets the first word of that segment. I get the last word (inaudible) I hope. Let me just make this comment. (CROSSTALK) ROMNEY: I think first of all, let me -- let me repeat -- let me repeat what I said. I'm not in favor of a $5 trillion tax cut. That's not my plan. My plan is not to put in place any tax cut that will add to the deficit. That's point one. So you may keep referring to it as a $5 trillion tax cut, but that's not my plan. Number two, let's look at history. My plan is not like anything that's been tried before. My plan is to bring down rates, but also bring down deductions and exemptions and credits at the same time so the revenue stays in, but that we bring down rates to get more people working. My priority is putting people back to work in America. They're suffering in this country. And we talk about evidence. Look at the evidence of the last four years. It's absolutely extraordinary. We've got 23 million people out of work or stopped looking for work in this country. It's just -- it's -- we've got -- when the president took office, 32 million people on food stamps; 47 million on food stamps today; economic growth this year slower than last year, and last year slower than the year before. Going forward with the status quo is not going to cut it for the American people who are struggling today. LEHRER: All right. Let's talk -- we're still on the economy. This is, theoretically now, a second segment still on the economy, and specifically on what to do about the federal deficit, the federal debt. And the question, you each have two minutes on this, and Governor Romney, you -- you go first because the president went first on segment one. And the question is this, what are the differences between the two of you as to how you would go about tackling the deficit problem in this country? ROMNEY: Good. I'm glad you raised that, and it's a -- it's a critical issue. I think it's not just an economic issue, I think it's a moral issue. I think it's, frankly, not moral for my generation to keep spending massively more than we take in, knowing those burdens are going to be passed on to the next generation and they're going to be paying the interest and the principal all their lives. And the amount of debt we're adding, at a trillion a year, is simply not moral. So how do we deal with it? Well, mathematically, there are three ways that you can cut a deficit. One, of course, is to raise taxes. Number two is to cut spending. And number is to grow the economy, because if more people work in a growing economy, they're paying taxes, and you can get the job done that way. The presidents would -- president would prefer raising taxes. I understand. The problem with raising taxes is that it slows down the rate of growth. And you could never quite get the job done. I want to lower spending and encourage economic growth at the same time. What things would I cut from spending? Well, first of all, I will eliminate all programs by this test, if they don't pass it: Is the program so critical it's worth borrowing money from China to pay for it? And if not, I'll get rid of it. Obamacare's on my list. I apologize, Mr. President. I use that term with all respect, by the way.
OBAMA: I like it.
ROMNEY: Good. OK, good. So I'll get rid of that. I'm sorry, Jim, I'm going to stop the subsidy to PBS. I'm going to stop other things. I like PBS, I love Big Bird. Actually like you, too. But I'm not going to -- I'm not going to keep on spending money on things to borrow money from China to pay for. That's number one. Number two, I'll take programs that are currently good programs but I think could be run more efficiently at the state level and send them to the state.
Number three, I'll make government more efficient and to cut back the number of employees, combine some agencies and departments. My cutbacks will be done through attrition, by the way. This is the approach we have to take to get America to a balanced budget. The president said he'd cut the deficit in half. Unfortunately, he doubled it. Trillion-dollar deficits for the last four years. The president's put it in place as much public debt -- almost as much debt held by the public as al prior presidents combined. LEHRER: Mr. President, two minutes. OBAMA: When I walked into the Oval Office, I had more than a trillion-dollar deficit greeting me. And we know where it came from: two wars that were paid for on a credit card; two tax cuts that were not paid for; and a whole bunch of programs that were not paid for; and then a massive economic crisis. And despite that, what we've said is, yes, we had to take some initial emergency measures to make sure we didn't slip into a Great Depression, but what we've also said is, let's make sure that we are cutting out those things that are not helping us grow. So 77 government programs, everything from aircrafts that the Air Force had ordered but weren't working very well, 18 government -- 18 government programs for education that were well-intentioned, not weren't helping kids learn, we went after medical fraud in Medicare and Medicaid very aggressively, more aggressively than ever before, and have saved tens of billions of dollars, $50 billion of waste taken out of the system. And I worked with Democrats and Republicans to cut a trillion dollars out of our discretionary domestic budget. That's the largest cut in the discretionary domestic budget since Dwight Eisenhower. Now, we all know that we've got to do more. And so I've put forward a specific $4 trillion deficit reduction plan. It's on a website. You can look at all the numbers, what cuts we make and what revenue we raise. And the way we do it is $2.50 for every cut, we ask for $1 of additional revenue, paid for, as I indicated earlier, by asking those of us who have done very well in this country to contribute a little bit more to reduce the deficit. Governor Romney earlier mentioned the Bowles-Simpson commission. Well, that's how the commission -- bipartisan commission that talked about how we should move forward suggested we have to do it, in a balanced way with some revenue and some spending cuts. And this is a major difference that Governor Romney and I have. Let -- let me just finish their point, because you're looking for contrast. You know, when Governor Romney stood on a stage with other take $10 of spending cuts for just $1 of revenue? And he said no. Now, if you take such an unbalanced approach, then that means you are going to be gutting our investments in schools and education. It means that Governor Romney... (CROSSTALK)
OBAMA: ... talked about Medicaid and how we could send it back to the states, but effectively this means a 30 percent cut in the primary program we help for seniors who are in nursing homes, for kids who are with disabilities.
LEHRER: Mr. President, I'm sorry.
OBAMA: And -- and that is not a right strategy for us to move forward.
LEHRER: Way over the two minutes.
OBAMA: Sorry.
LEHRER: Governor, what about Simpson-Bowles? Do you support Simpson-Bowles?
ROMNEY: Simpson-Bowles, the president should have grabbed that.
LEHRER: No, I mean, do you support Simpson-Bowles?
ROMNEY: I have my own plan. It's not the same as Simpson- Bowles. But in my view, the president should have grabbed it. If you wanted to make some adjustments to it, take it, go to Congress, fight for it.
OBAMA: That's what we've done, made some adjustments to it, and we're putting it forward before Congress right now, a $4 trillion plan...
ROMNEY: But you've been -- but you've been president four years... (CROSSTALK)
ROMNEY: You've been president four years. You said you'd cut the deficit in half. It's now four years later. We still have trillion-dollar deficits. The CBO says we'll have a trillion-dollar deficit each of the next four years. If you're re-elected, we'll get to a trillion-dollar debt.
ROMNEY: I mean, you have said before you'd cut the deficit in half. And this -- I love this idea of $4 trillion in cuts. You found $4 trillion of ways to reduce or to get closer to a balanced budget, except we still show trillion-dollar deficits every year. That doesn't get the job done. Let me come back and say, why is it that I don't want to raise taxes? Why don't I want to raise taxes on people? And actually, you said it back in 2010. You said, "Look, I'm going to extend the tax policies that we have now; I'm not going to raise taxes on anyone, because when the economy is growing slow like this, when we're in recession, you shouldn't raise taxes on anyone." Well, the economy is still growing slow. As a matter of fact, it's growing much more slowly now than when you made that statement. And so if you believe the same thing, you just don't want to raise taxes on people. And the reality is it's not just wealthy people -- you mentioned Donald Trump. It's not just Donald Trump you're taxing. It's all those businesses that employ one-quarter of the workers in America; these small businesses that are taxed as individuals. You raise taxes and you kill jobs. That's why the National Federation of Independent Businesses said your plan will kill 700,000 jobs. I don't want to kill jobs in this environment. I'll make one more point. (CROSSTALK)
LEHRER: (inaudible) answer the taxes thing for a moment.
ROMNEY: OK.
LEHRER: Mr. President?
OBAMA: Well, we've had this discussion before.
LEHRER: About the idea that in order to reduce the deficit, there has to be revenue in addition to cuts.
OBAMA: There has to be revenue in addition to cuts. Now, Governor Romney has ruled out revenue. He's ruled out revenue. (CROSSTALK)
ROMNEY: Absolutely. (CROSSTALK)
ROMNEY: Look, the revenue I get is by more people working, getting higher pay, paying more taxes. That's how we get growth and how we balance the budget. But the idea of taxing people more, putting more people out of work, you'll never get there. You'll never balance the budget by raising taxes. Spain -- Spain spends 42 percent of their total economy on government. We're now spending 42 percent of our economy on government. I don't want to go down the path to Spain. I want to go down the path of growth that puts Americans to work with more money coming in because they're working.
LEHRER: But -- but Mr. President, you're saying in order to -- to get the job done, it's got to be balanced. You've got to have... (CROSSTALK) OBAMA: If -- if we're serious, we've got to take a balanced, responsible approach. And by the way, this is not just when it comes to individual taxes. Let's talk about corporate taxes. Now, I've identified areas where we can, right away, make a change that I believe would actually help the economy. The oil industry gets $4 billion a year in corporate welfare.
Basically, they get deductions that those small businesses that Governor Romney refers to, they don't get. Now, does anybody think that ExxonMobil needs some extra money, when they're making money every time you go to the pump? Why wouldn't we want to eliminate that? Why wouldn't we eliminate tax breaks for corporate jets? My attitude is, if you got a corporate jet, you can probably afford to pay full freight, not get a special break for it. When it comes to corporate taxes, Governor Romney has said he wants to, in a revenue neutral way, close loopholes, deductions -- he hasn't identified which ones they are -- but that thereby bring down the corporate rate. Well, I want to do the same thing, but I've actually identified how we can do that. And part of the way to do it is to not give tax breaks to companies that are shipping jobs overseas. Right now, you can actually take a deduction for moving a plant overseas. I think most Americans would say that doesn't make sense. And all that raises revenue. And so if we take a balanced approach, what that then allows us to do is also to help young people, the way we already have during my administration, make sure that they can afford to go to college.
It means that the teacher that I met in Las Vegas, a wonderful young lady, who describes to me -- she's got 42 kids in her class. The first two weeks she's got them, some of them sitting on the floor until finally they get reassigned. They're using text books that are 10 years old. That is not a recipe for growth. That's not how America was built. And so budgets reflect choices. Ultimately, we're going to have to make some decisions. And if we're asking for no revenue, then that means that we've got to get rid of a whole bunch of stuff. And the magnitude of the tax cuts that you're talking about, Governor, would end up resulting in severe hardship for people, but more importantly, would not help us grow. As I indicated before, when you talk about shifting Medicaid to states, we're talking about potentially a 30 -- a 30 percent cut in Medicaid over time. Now, you know, that may not seem like a big deal when it just is, you know, numbers on a sheet of paper, but if we're talking about a family who's got an autistic kid and is depending on that Medicaid, that's a big problem. And governors are creative. There's no doubt about it. But they're not creative enough to make up for 30 percent of revenue on something like Medicaid. What ends up happening is some people end up not getting help. ROMNEY: Jim, let's -- we've gone on a lot of topics there, and so it's going to take a minute to go from Medicaid to schools... LEHRER: Come back to... (CROSSTALK)
