Bill Clinton: “Well, let me tell you what they say. I mean, it's interesting what a lot of them say who aren't for the gasoline tax.…”

“Well, let me tell you what they say. I mean, it's interesting what a lot of them say who aren't for the gasoline tax. They think that it raises so little money that it's not worth the political heat. A lot of them are basically tired of the partisan beating up they've gotten for trying to do something responsible about the deficit. They are frustrated that all of their attempts to put in more spending discipline--and Charlie Stenholm has done, I think, a brilliant job of that--has not generated any willingness on the part of Republicans to support any kind of reasonable budget package. And so they're saying that this is a pure matter of public perception: ``Why for a relatively small amount of money should we have any gas tax at all since it is a modest one and give the Republicans something else to beat us over the head? Why don't we just keep the upper income taxes and the spending cuts and go on?'' Here's the answer to that, and it's the question I pose to them. In other words, there's no--it's just not like the Btu tax. You can't make a claim that it's promoting great energy conservation or it's good for the environment or anything. It's just a very modest attempt to raise some funds to pay down the deficit and monies which someday might go into road building after the end of the deficit reduction period but not any time in the foreseeable future. The answer is this: If we have to pass this bill with only Democrats, there are other conservative and moderate Democrats who don't object to the gas tax but would object if we took out the economic growth incentives. And let me just mention some of them. And there are others who would object if we didn't reduce the deficit by $500 billion or some figure very close to it. So then the issue is, if you take out the gas tax, what do you replace it with? If you just say, ``Well, we'll just reduce the deficit by that much less,'' then you have all these people who say, ``Well, you lose me because we're not reducing the deficit enough.'' Or do you say, ``We'll take out the gas tax and we won't have any economic growth incentives.'' Now, let me mention some of them to just give you an example. Over 90 percent of the subchapter S, the small businesses in this country, will be eligible for a tax cut under this program because we double the expensing provisions. So any small business with adjusted gross income of under $140,000, which is 94 percent of them, will be eligible for a tax cut under this program. They generate a lot of the jobs in America. That's a job program. We've got a provision in here to provide cap- ital gains treatment--big break in people who invest for 5 years in companies that capitalize at $50 million a year or less. We took out the surcharge on capital gains to give people incentives to invest so they can earn investment income at lower rates than the personal rates. We have increased the research and development tax credit. We've increased the incentives for investing in getting real estate and homebuilding going again. That's one reason the national realtors and the homebuilders have endorsed this plan, two predominately Republican groups. If you take all that out, you know, to keep the deficit number up, to get rid of the gas tax, then you lose a whole different group of Democrats. Then there are those who say, ``Well, we don't need the earned-income tax credit. Get rid of that and get rid of the gas tax.'' The problem is if you do that, you lose people who represent huge numbers of working poor. Eighteen percent of the work force in this country now, including a whole lot of folks in Texas, work 40 hours a week and still live below the poverty line. That's a stunning statistic. Perhaps the most important social policy, if you will, that I would think virtually all Americans could agree on that this plan furthers is that this says, if you're one of those folks and you have children in your home, and you work 40 hours a week, the tax system will lift you above poverty so that nobody who works with children will be in poverty if this plan passes, once we get it fully phased in. So if you take that out, then you lose all those Democrats that represent that. So the real problem is it's really an arithmetic problem. If you want the pro-growth, pro-jobs incentives and you want to support work instead of welfare and you want to stay at $500 billion of deficit reduction or awfully close, how do you do it without this modest fuel tax? The only other option that was given is further cuts in Medicare, which in my opinion, again, would lose you a lot of Democrats, both people who are concerned about middle class elderly people on Medicare and people who are concerned about doctors, hospitals, home health providers, and others who are under reimbursed now and who just have to shift their costs onto the private sector. So if someone could solve that problem--I wouldn't say that problem couldn't be solved--but I think it is highly unlikely that a resolution of that--I'm sympathetic with Charlie Stenholm. He has been very courageous. He has been very helpful. He has done as much as any Member of the Congress in either party to really control the deficit. And nobody has a better record than he does in trying to control spending and control the deficit. And he's made a very compelling case, but I don't know how to solve it.”