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tv   The Journal Editorial Report  FOX News  January 24, 2015 11:00am-11:31am PST

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and 10 grams of protein to help maintain muscle. all with a delicious taste. grandpa! [ female announcer ] stay strong, stay active with boost. week on "the journal editorial report," the battle for the middle class. president obama lays out the economic vision for next two years and sets the stage for democrats in 2016. how should republicans respond? plus it's being called his robin hood tax plan but do the president's proposals target more than the rich? and a showdown is brewing as the white house and congress clash over iran sanctions. so will a democrat stand up to the president's veto threat? >> middle class economics means helping working families feel more secure in a world of constant change.
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that means helping folks afford child care, college, health care. a home. retirement. >> welcome to "the journal editorial report." first up the battle for the middle class. that was president obama in his state of the union address laying out his economic vision for the next two years. and setting the stage for the coming presidential campaign. the president tuesday night proposed hundreds of billions of dollars in new taxes in order to fund as slew of new government programs. all in the name of economic equality. so how will republicans in congress respond and can the gop presidential hopefuls lay out an alternative vision for 2016? let's ask "wall street journal" columnist dan henninger. assistant editorial page editor james freeman and washington columnist kim strassel. so kim, start with you. the president's agenda sounded to me like one more appropriate to say one where nancy pelosi was speaker of the house. kind of a wish list of things
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what's going to give away. what's the thinking here on his part, the political calculation? >> well, if it wasn't clear already from his veto threats and his executive orders and general aggressiveness from the midterms he has no real interest in working with republicans over the next two years. >> really? it was that definitive of a declaration? >> oh, yeah. i think that's what this state of the union was declaring which is he intends to use the next two years to lay the groundwork for maybe even set the terms for a presidential run by hillary clinton or elizabeth warren and it's going to be all about the middle class and how democrats will make the argument they can make things better with government giveaways to the middle class than republicans ever can. >> well, i want to talk about the reason for that. because now the economy is finally growing as we know. last six month at least it's grown better. but middle class incomes haven't
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risen. >> no. >> in fact, we have a chart here that shows us that in the 1980s and 1990s, you had increases in median household income. and then they fell a bit during recessions, they came back in the mid 2000 and now they have been flat. that's the kind of anxiety that the president is trying to address, james. the problem is it's anxiety that he's helped to cause. >> yeah his policies have really been the battle against the middle class and you can think of all of these new proposals as kind of offsetting the damage that his tax and regulatory limits on growth have imposed from washington. >> because we have had such slow growth. that's why we don't see middle class incomes rising. >> you're seeing basically now this is kind of a wish list that targets the people he thinks are democratic voters within the middle class. in other words, within the middle class, not much here for people who pay taxes, who save, who are in households with a parent at home raising children. it's really geared toward people who don't have income, don't --
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or don't have taxable income, don't save, two earner couples or, you know, young childless adults getting more tax credits. so i think what republicans have to do instead of trying to match his subsidies and say, here's how we grow the pie for everybody. >> well, let's talk about whether this pitch the president made is going to work. >> well, it could work if the republicans don't push back against it and describe the world that barack obama is presenting to the american people. i think it's not just obama. it's the democrats, it's the democratic left. they have an idea of an economy in which the government does all these things that he wants it to do. but if the government consumes that much of the nation's productivity you will have a situation much like europe. whose growth rates are at least a percentage point below ours. the result -- high youth unemployment. in the european union last year
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average youth unemployment was 22%. in spain, 54%. in italy 34%. there were 5 million unemployed young people in europe has year. >> yeah -- >> and the way you compensate for that is by increasing the welfare state so people get money from the government. >> kim a lot of debate in washington among republicans. do republicans need their own so called middle class agenda? >> the temptations for the republicans to match, as james said and be the ones handing out goodies to americans and child care tax credits and health care and college. the problem is what they don't understand, you can't win that war with democrats because they're always too willing to spend more money than republicans are. so what they really need to do in the discussion now is how do you formulate a conservative alternative? and one of the things they're going to have to do is their policies are good. what they have not done as well is actually connecting them to
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the troubles that americans are facing today. of declining wages and day to day issues. you need a presidential candidate who can do that. they have also got to remind everyone while government free stuff sounds good, we just had a lot of examples with obamacare and elsewhere where when government run these things it doesn't turn out so well. >> is hillary clinton going to essentially adopt the obama agenda? is she going to come there -- >>showe's going to try. it's gotten harder for her as her wealth has soared and her speaking fees have gone past the $200,000 mark. it will be tough because what she's got to do is take the message, but disassociate herself from the results for the middle class that president obama has delivered. >> all right. describing the results are key to the republican response and
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making sure who is responsible. it is being called his robin hood tax plan. when we come back we'll look at the president's proposals to take from the rich and give to others. but is it just the 1% who stand to lose? .. ...heartburn. did someone say burn? try alka seltzer reliefchews. they work just as fast and are proven to taste better than tums smoothies assorted fruit. mmm... amazing. yeah, i get that a lot. alka seltzer heartburn reliefchews. enjoy the relief.
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well, it's being dubbed as robin hood tax plan and president obama hit the road this week to sell the proposals he laid out in his state of the union address, including the new taxes on savings and investment. but is it just the rich who stand to lose? we're back with dan henninger av1 james freeman and "wall street journal" columnist mary joins us also. mary, he's already raised taxes considerably on the so-called wealthy. why do it again when you have the economy now moving ahead?
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looks like we could get faster growth. why put a tax on savings and investment? >> well, paul, you're asking me again inside the president's head. i'm not exactly sure because it doesn't make sense to me. but my guess is that he is so obsessed with this idea of making everybody equal. sort of this fairness. it is no -- he's not probably going to collect enough money to make big changes in the economy. but he will bring people who are making more money and are more ambitious down and that's one of hisly asked in 2008 why raise capital gains taxes if the revenue isn't there. he said, well, it's fairness. that's the point. so the point is punitive, not necessarily practical in getting more out of you. >> that's dangerous obviously f the focus is not a tax system to fund government or to help our
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economy grow but to kind of punish those who have been successful. what you're seeing now with this tax plan essentially hitting new death taxes and new taxes on investment what that does is discourage the money to invest in middle class jobs in building new businesses and expanding businesses. i think the response from the republicans has to talk about what works for the middle class is freedom. that's a how you get growth in incomes. >> dan, you have a sense of whether any of this is going to pass? >> none of it is going to pass. i mean, the republican-controlled senate now so there's no chance whatsoever. raising the question of what exactly is barack obama doing? and i think he's an obsessive presidency, he gets the ideas in his head. he wants to spread -- look, obama is basically a socialist, okay? i mean -- >> really? >> oh, come on. it's so obvious. i mean, people have been shouting that in e-mails to us for years. it's clearly true.
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the second point is, barack obama has no understanding whatsoever of how the private economy works. no experience, never been around it. >> look, all i'm trying to do is raise the capital gains tax to 28%. it's 23.8%. it was 28% when ronald reagan was president. >> exactly. >> what's the big deal henninger? ronald reagan -- >> because when ronald reagan put it at 28% he had lowered the top rate from 50% to 28%. okay? for personal incomes. now, it's 39.6% under obama. >> you know, paul, the other thing -- the other thing is he wants to now remove the tax benefits that people have for saving for education. and basically, the message there is that if you have enough money, if you make enough money to be able to save for the future, you are one of the elites in this country and therefore, you -- that right or that privilege should be taken
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away from you. >> let's tease out some of the details that mary referenced. 529 plans, the -- >> 11.8 million accounts. >> those are accounts that people put in and they can raise money -- they put in after-tax money, but then it raises tax free and you can withdraw as long as it's for education without paying a tax penalty. >> that's right. and -- >> he wants to limit -- >> they're popular and what he's saying now is let's start taxing as income if -- the withdraw on earnings on those contributions. in the future. >> right. >> you could argue if we have a simplified tax system you wouldn't have -- >> you wouldn't have anything like this. >> but the fact is given what government has done, driving up the cost of education, given the difficulty for middle class people to save this is a big benefit for people trying to put kids through college and to target this, it really -- this is one really discordant note on
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the rhetoric of the middle class. because the average account is a little over $20,000. this is not just targeting the 1 percenters. >> that's not warren buffett's 401(k). >> exactly. >> the message there is, if you have enough income to save that means you're a rich person. anybody who doesn't save in the accounts -- >> or if you made the sacrifices to save. they're not making that much but they made a commitment, i want my kids to go to college. i want them to do better than i did and this is ending that. >> quickly, dan corporate tax reform, the president barely touched on it. and then by way of saying we'll close loopholes he didn't talk about lower rates. does that mean it's dead? >> i think it means it is dead and tax reform is going to be dead. it is very unfortunate the president cannot at least approach the republicans to do that one piece. it looks like it won't happen. >> all right. it's a shame. when we come back, a showdown is brewing between the white house
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and congress over new iran sanctions. so will senate democrats stand up to president obama's veto threat?
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our diplomacy doesn't work with respect to iran where for the first time in a decade we have halted the progress of the nuclear program and reduced its stockpile of nuclear material. the new sanctions passed by this congress at this moment in time will all but guarantee that diplomacy fails that's why i will veto any new sanctions bill that threatens to undo this progress. >> president warned congress he'll veto any new sanctions as talks continue setting him on a collision course with members of both parties. on wednesday, house speaker john
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boehner side stepped the white house and invited israeli prime minister benjamin netanyahu to address congress next month about the growing threat from tehran. and senator menendez on the foreign relations committee had this to say about the administration's diplomatic approach. >> iran is clearly taking steps that can only int interpreted as provocative, yet the administration excuses away any developments and iran's bad faith. >> the more i hear from the administration and its quotes, the more it sounds like talking points that come straight out of tehran. >> dan, striking language from a member of the president's own party. why aren't members of both parties challenging the president so strongly on iran? >> because we have arrived at a point where the members of the senate who work on the subjects
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have lost faith in the president's ability to negotiate a secure agreement with the iranians and the specific point there we showed the president saying, he had halted the progress of their program. look, in nuclear arms negotiations every detail, every phrase is vetted carefully. why did he say halted? because the arms control community immediately jumped on this and said this is not true. >> they're still enriching uranium. >> they're still enriching uranium, storing it. they're still working on their senary senary centrifuges. senator menendez i think is entitled to say that they are not doing a deal they can support. >> mary, thedid you agree with the speaker's decision to invite prime minister netanyahu without asking the white house first? >> i think it's completely within his rights and i think it's the right thing to do because the president is not being straight with the american people.
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i mean, not only did he say in the state of the union that they had halted the program, but he also talks about these proposed sanctions as if they're talking about putting them on now. the reason the word dead is in deadline is it's supposed to mean when you reach that point, the talking is over and they have to deliver by june 30th. >> they have extended it twice already. >> exactly. so all of the republicans and bob menendez, bipartisan effort, are talking about doing is saying to iran if we get to that deadline and you don't have an agreement, this is -- we're going to put new sanctions on. >> but what about those who say that the invitation to netanyahu was needlessly disrespectful of the president who has to negotiate and deal with these heads of state. >> well, i think we're talking about something so serious here. i mean, this isn't a domestic issue that congress and the president can debate back and forth, and be changed in the next term if there's a republican president. this is something that if iran
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goes forward with its nuclear program will change not only things between the u.s. and iran, but will change the contour of the middle east forever with an arms race developing. that's extremely dangerous for the world. >> kim, on the politics of this i wonder where you think these -- the challenge going to go. because you have the kirk menendez bill that would do what mary said, and then you have an effort by senator bob corker, also bipartisan that would say, congress must vote on any deal that the president sends up. with iran. are either of these likely to pass? >> so you currently have 12 sitting senate democrats that have in the past all cosponsored legislation to impose any sanctions on iran. that's an important number, paul, because when you add them to republicans the number you can override the presidential veto. >> close. you need 67. >> 66, you need 67 but you're getting close. you're seeing enormous pressure
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to get some of these people to back down and you are seeing some senate democrats back down from that. the corker legislation may have more of an immediate impact, more momentum. only in that it gets into congressional prerogative, a lot of people on both sides of the aisle like that. giving congress some control over saying whether or not an ultimate deal gets their stamp of approval. a little bit of an insurance policy and hopefully a way of keeping the president in line in negotiations. so there's a lot of interest in that. >> briefly dan, a lot of members of congress are thinking why shouldn't this be treated as a treaty? >> all the arms agreements virtually all the arms agreements from the 1970s through the 1990s were treaties sent to congress sent there for ratification. and the corker amendment is what has traditionally been done with the agreements. >> all right.
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when we come back, the hits and misses of the week.
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time now for hits and misses of the week. dan, start us off. >> well, paul, i'm going to give a big hit to the new clint eastwood movie "american sniper." not nearly because it's about the legendary sniper chris kyle, but it does depict the sacrifice and commitment that the marines and soldiers made to pacify iraq. i mean, the psychological, physical toll is extraordinary. it's very touching because as we know, president obama pulled all of the troops out in 2011. and allowed iraq to fend for itself. islamic state has retaken the area that these guys sacrificed to grab for us. it was awful. >> all right. kim? >> we now have 42 cases of measles linked to disneyland in california. those numbers are likely to rise. this is part of a disturbing new trend in the united states of over 611 cases of measles last
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year which is more than three times the year before. so this is a miss once again to the anti-vaccine community which continues to spread falsehoods about vaccines including that it causes autism. we have to start getting the real information out about this and it's dangerous for kids. >> thanks. and james? >> well, in some cases deflation can be a good thing but not when it comes to football. so this is a miss to the new england patriots who played last week with underinflated footballs which makes it easier to throw and catch. tom brady, the quarterback and coach bill belichick have denied involvement, but this is a problem for a franchise that has been caught for much more serious cheating in the past. you'd hate to think this is going to go down as the mcguire/sosa era of football. but tom brady said this week, basically it wasn't as bad as isis, so that's where we're setting the bar? i'm sure aaron hernandez hasn't been accused -- >> okay. free blitz on belichick.
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thanks to my panel and all of you for watching. i'm paul gigot. and we start with the fox news alert. another atrocity by the islamic state. there is the new video that claimed one of the two japanese hostages the man you see on the right has been killed. now those terrorists have a new set of demands to try and spare the life of the second hostage. hello, i'm eric shawn. >> i'm arthel neville. thanks for joining us here in america's news headquarters. the islamic state originally demanded $200 million for the two men to be delivered within 72 hours and that ended yesterday. earlier today a video went online showing this, the second hostage holding a


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