balancing the budget and reforming government good evening tonight we're going to talk about how to solve the problems that we defined that face our country I think we can come to the conclusion immediately with this quote history repeats itself the budget should be balanced the treasury should be refilled public debt should be reduced the arrogant of public officials should be controlled these are not new words cisero said these words over 2,000 years ago but certainly they apply to our country today anytime we do anything we try to learn from experience we learned a lot from the first program from your comments first you wanted better charts that you could see the fine print on and you'll have those tonight secondly we had one news announcer cred the pointer that I used before so since we're dealing with voodoo economics a great young lady from Louisiana sent me this Voodoo stick and I will use it as my pointer tonight and certainly it's appropriate because as you and I know we are in deep voodo well let's get right to work let's sort of do a quick summary of what we discussed before in terms of where we are then we'll go to the solution we're $4. 1 trillion in debt that's a staggering burden to P to our children it's unconscionable just this year we ran up $341 billion in new debt and as we discussed the other night that's our legislators and our president trying to buy our vote this year with what used to be our money we're not that dumb now where does the money come from comes from all these places and we get $1. 1 trillion coming in the door the two major sources are individual income tax and Social Security and Medicare corporate income tax is the third the others are fairly small how much money do we spend we got a trillion one coming in but we're spending a trillion five most of that goes to Social Security Medicare and other entitlements next to that is National Defense a little over $300 billion next to that is interest on the debt that's unusually low this year because the interest rates are so low but don't count on that continuing every time the interest rates go up 1% the 70% of the national debt is 5 years or less goes up$ 28 billion that's the impact what is the net effect of the way our country's been run what used to be a dollar in 1950 is now 18 no wonder both parents are working some of them two jobs just to make ends meet running the value of the dollar down is really hurting the people in our country now let's look at the net effect on all of us from 77 to '92 the poorest got poor the second poorest fifth this is 20% of the population still lost money the middle fifth the three fifths up still lost money when you get to the four fifth it's break even the richest fifth is the only place that went up now go to the top 5% the top 1% top 5% improv their incomes by 60% the top 1% by 138% trickle down economics didn't Trickle and this isn't fair right what about our average hourly wage at a time when we need to have everybody at work and make it more money so that we can pay our bills just follow it here this 60s 7s 80s 90 it's dropping shouldn't surprise you supply and demand we got people out of work but just to show you how fouled up the system is in the middle of all this what's happening to our corporate executive salaries compared to those of our industrial competitors are beating us in head-to-head competition here's the ratio between worker compan compens ation and executive compensation in Japan here is the ratio in Europe and here is the ratio in the United States trickle down economics didn't trickle at all folks it all stopped right here that's not good for the companies that's not good for the stockholders that's not good for the country and that leaves us vulnerable excuse me these guys want to make this kind of money they ought to be tv anchormen basketball players uh a rock stars but running a company look these fellas have their head straight here they're getting appropriate income but not Rockstar income let's look at our International competitors now you don't have to like the fact that we live in a tiny world but I'm telling you we're stuck with it somebody wins somebody loses here we are look at how they are growing here's our growth here's Japan's growth here are the newly industrialized Asian countries that at one time you and I thought just raise rice you're not raising rice anymore folks they've got what used to be the high paying jobs here over there this chart makes it as clear as I can to you in terms of who is going to own tomorrow think of Taiwan tiny little island there it is just in a little piece of Texas they're going to spend $600 billion on public investment programs our great country is going to spend 150 billion 1/4 that much we have a population of 248 million Taiwan has 20 million know fact we're over about 12 times their population and we're spending a fourth as much preparing for the future all right let's go from there to Japan here is Japan Japan is about the size of Montana if you pack it all together it's much smaller than it appears on the map has a population half our size but Japan is spending $80 billion right now on building for the future short term now let's go to Germany keep your eye on Germany I told you that you know they're paying paying a good price for money Germany is right here in purple Germany has 78 million people but Germany will spend one trillion dollar over the next 10 years rebuilding East Germany we'd better get busy and start rebuilding our great country and not just wandering around saying well everything will work out if we don't do anything does that ever happen in your life say maybe the problem will go away in my life if I ever take that attitude the problem just grows and grows and grows you want to it go away you make it go away okay here's the end result of letting our country Decay like this the 18 to 24 year old men in this country back in 1980 18% of them made less than 12,000 a year in 1990 it's up to 40% with the women in 1980 29% made less than 12,000 a year today 48% make less than 12,000 a year and it is voodoo economics and maybe now's the time for me to wave the voodoo stick and get rid of the hex but it'll take a lot more than that it'll take millions of you showing up on November the 3 to get rid of this hex keep in mind the value of the dollar is going down the number of people making less than $122,000 is going up I don't want to bore you with this statement but trickle down didn't trickle it just didn't work we have 19th C Century capitalism in this country our successful International competitor s are practicing modern day capitalism we need to practice 21st century capitalism we need an intelligent supportive relationship between government and business we need long-term thinking we need to Target the industries of the future and make sure they are here and the words made in the USA or written across them we need to have the most rapidly growing small business Society in the world because we can create more jobs more quickly there all of this can be done but just look at that and I think you'll conclude the way we're going is the wrong way here are the solutions we're going to start with balancing the budget we got to cut General spending by 315 billion business tax increases of 49 billion other tax increases of 293 billion entitlement reform will bring us 268 billion spending increases to help build our country an additional 109 billion tax decreas is 62 billion it Nets out savings of $754 billion we got a balance budget just like you have to balance your budget Congressional budget office projection out through 98 is here our plan takes us down to here that's a 754 billion deficit reduction do we have to do it of course we do we're going to have a 10% cut in discretionary programs we'll have a 5% cut in specific programs these discretionary programs include such things as science Grants Farm supports government operations etc etc down here we'll have a $22 billion cut in business subsidies and we will have over this period of time $145 billion in interest savings just because we stopped spending so much extra money tax decreases it's not all bad news we will have a $27 billion decrease in taxes to get an investment tax credit and that money will be spent to build new factories buy plant and equipment and create jobs that money spent right on the bullseye doesn't go into somebody's pocket to buy a yacht right over here we're going to have a decrease here and it's a tax credit to stimulate research and development we call it now research and experimentation you and I used to call it R&D but this is to Target the industries of the future and make sure that we lead and dominate in those Industries we're going to spend $10 billion in tax credits on worker training to train our people for the jobs of tomorrow now then we've got to get money from institutions from individuals from every place there is money invested in the treasuries of companies now hold that thought not shooting dice on Wall Street invested in the treasuries of companies so that those companies have have the money to create jobs we will create more jobs more quickly by putting money into little companies start up businesses small businesses than any other way but that is high-risk money the investor may lose it we've got to give the investor an incentive to put it there as opposed to buying government bonds or putting it in the bank drawing interest in a savings account that's federally guaranteed believe me this comes back again and again and again and again and if anybody has any hesitation about it we'll have a 30-minute program on this one cuz we're going to put it the treasury the money will be used to build the company to create jobs and the tiny little money that goes into that Treasury and the tiny little bit of taxes that we don't get will be lost compared to the thousands of people that company may eventually employ the payroll taxes they'll pay the income taxes that company will pay it will be a giant Financial pump for our country business tax increases going to improve the tax collection from foreign companies that'll get us 21 billion we'll reduce the business entertainment deduction you know kind of almost charge off anything against your income tax on entertainment now we'll say 16 billion now have increase in users fee of $12 billion that'll bring us in $49 billion other tax increases here's one you don't like raise the gasoline tax that brings us $158 billion which we'll use to rebuild our country every other industrialized country has a much higher tax than we're proposing it's 10 cents additional per year for 5 years years so it's 10 20 30 40 50 it's just adds up over time to a maximum of 50 cents after 5 years the other two candidates like to tell you it's a 50 Cent tax no it goes on 10 cents a year and I'll tell you more in a minute about why we have to do it we'll have a tax increase on Tobacco we'll have an increase uh on income tax rates for the top 4% of the population and we'll reduce tax exemptions for the rich for example put a ceiling of $250,000 on mortgages that you can deduct it will be no reduction on uh mortgages on second homes let's go back to gasoline for a minute here's what our industrial competitors are doing Italy collects $357 in taxes for every gallon of gasoline France 312 Japan $2.
25 United Kingdom 209 Germany $1. 99 and the United States collects 35 C we have got to collect more taxes in this country and this is one Fair place to get it if we spend all of that money on building for the future and don't squander it on some new pork barrel program in Congress this money will be dedicated for specific purposes this is going to require Sacrifice by all of us it will pay huge dividends for us our children and our grandchildren now I will be delighted if someone can come up with a better idea if you don't like this we've got to have a better idea but this one right here this gasoline tax let's look at what it raises $158 billion come up with with something else that's more painless that'll give us that we'll drop it in a minute go to that entitlement reform okay we're going to have to repeal the salary cap of $130,000 on Medicare you stop paying after $130,000 of income you'll have to keep it up under this new program medicare premiums were initially designed to pay half the cost of Medicare Part B now it's down to 25% we're going to raise it up to 35% that'll give us 38 billion still a bargain for the people who use it healthc care Cost Containment we can save 141 billion you say how sure am I dead sure and I'll show you in a minute here we we will reduce colas for federal employees and here we will tax the top 18% only of Social Security recipients on 85% of their income instead of 50% of their benefits now this gets translated by the other two candidates is we're going to tax Social Security or last night president said we're going to cut it no all we're going to do instead of taxing it at 50% we're going to tax up to 85% and of the wealthiest that's just the top 18% again if you don't like that one give me a better idea that will raise $30 billion now why am I so confident that we can reduce Health Care spending by a dramatic amount we're going to cut it 141 billion all right here's why I think so look at what what the rest of the world spends on Healthcare 6% of gross national product here Germany 8% Japan 6.
