Van Hollen Open to Medicare Cuts in a Tax Deal (Transcript)
Representative Chris Van Hollen, a Maryland Democrat, said during an interview with Bloomberg Television’s “Political Capital with Al Hunt,” airing this weekend, that House Majority Leader Eric Cantor’s recent bid to remake the Republican Party is little more than public relations while expressing a willingness to consider one Republican proposal to restructure Medicare.
(This is not a legal transcript. Bloomberg LP cannot guarantee its accuracy.)
AL HUNT: We begin the show with Democratic Congressman Chris Van Hollen, ranking member of the House Budget Committee. Congressman, thank you for being with us.
CHRIS VAN HOLLEN: It’s great to be with you, Al.
HUNT: The dreaded sequester takes effect in 10 days. I know you hate it, say it’s going to cost 750,000 jobs. But let me ask you, how’s it going to -- how will it play out? Is some kind of compromise possible? Will Republicans capitulate? Or are they going to hang tough, do you think?
VAN HOLLEN: Well, the question is whether Republicans will compromise, because it will cost 750,000 jobs between March 1 and the end of the year. That’s not my number. That’s the nonpartisan Congressional Budget Office number -
HUNT: CBO. What’s your gut feel of whether they’ll compromise?
VAN HOLLEN: My gut feeling is that they will not compromise before March 1st, and then the question is, once the sequester begins to kick in, whether there will be enough pain for them to agree they have to compromise, meaning that we have to replace the sequester through a different deficit-reduction mechanism that takes place over a period of time, balanced approach, which, by the way, Al, in the House, the Democrats have four times put forward an alternative that would achieve the same amount of deficit reduction without the job loss.
HUNT: Do you think they will -- that the Republicans eventually will see that pain so great that they will have to go along with some kind of compromise?
VAN HOLLEN: Well, I think that, in the Senate, some of the Senate Republicans have indicated that they would prefer to close some of these special interest tax loopholes, in combination with some targeted cuts, rather than have the across-the-board defense cuts take place. Senator McCain -
HUNT: Let me ask -
VAN HOLLEN: - and others have indicated -
HUNT: Said that the other day.
VAN HOLLEN: - a willingness to consider that.
HUNT: The president in the State of the Union said, as part of a longer 10-year package, he would be willing to go along with Medicare cutbacks, like Bowles-Simpson. That’s about $325 billion over 10 years.
Would House Democrats support that, if it was part of an overall package?
VAN HOLLEN: Yes, if it was structured the right way. And the big difference, Al, between the Republican approach to Medicare reductions and the Democratic approach, Republicans want to simply pass on these rising health care costs in the form of vouchers and otherwise. The president, for example, specifically mentioned asking the big pharmaceutical companies to contribute more. That’s about $130 billion in the president’s budget.
HUNT: But if you did it that way, maybe have means testing, but not have a raise -- not raise the eligibility age and raise about $300 billion, and did it with revenue increases, that’s something Democrats might buy off on?
VAN HOLLEN: Yes, again, depending entirely on how it’s done, if you do it, as I said, with the higher rebates, also improving the coordination of care, accelerating the ways we did it in the Affordable Care Act. There is money to be saved by moving away from a strict fee-for-service system toward one that changes the incentives to focus on quality of care, not quantity of care.
HUNT: Would Democrats consider entitlements without any revenue increases, without Republicans going along with revenue increases as part of a deal?
VAN HOLLEN: Well, we’ve always said you need to have a balanced approach.
HUNT: So you wouldn’t do it without?
VAN HOLLEN: Well, no, because we think that it is totally unfair to consider asking somebody who has a median income of $22,000 on Medicare to see some change, when you’re not asking millionaires to pay the same effective rate as their secretaries, applying the Buffett rule.
HUNT: The House majority leader, Eric Cantor of Virginia, gave a speech last week, put a new face on Republicanism. I’m sure you’ve read it. What did you think? Is it a new face?
VAN HOLLEN: I haven’t seen any evidence of it. I saw some new words and sort of a softer image, saying things like we’ve got to smile more, but as others have said, I mean, you’ve got to change the product, not just the salesmanship here. And I think when it comes to economics and the Republican approach to jobs and the economy, it’s more about changing the smile and the way you present the case. They’ve got to change their approach.
And, you know, I think the evidence of the last 50 years shows that one of the reasons the United States has become an economic powerhouse is we were willing to make important public investments in our infrastructure, basic science and research, educating our kids, and if we got to those important investments, it will be at the expense of our -- our future and our competitiveness -
HUNT: One of Mr. Cantor’s specific proposals was to combine Medicare Parts A and B, which he said would result in more -- in more efficiency and it would not hurt beneficiaries.
VAN HOLLEN: Right, well, this is one where the devil is entirely in the details. This is a proposal the Congressional Budget Office has laid out as an option. It’s something that we looked at during the Biden talks. So I would not say no off the cuff to that kind of idea. Again, the devil’s entirely in the details, and it gets back to this fundamental question. You’ve got to do it in a way that’s not changing the burden. And there may be ways to do it and make the program overall more efficient. Medigap reform is part of this discussion, because right now, the fact that Medigap policy can allow you to essentially have total first-dollar coverage. It means Medicare is essentially subsidizing a lot of those plans.
So there are ideas there. The president’s actually proposed them in his last budget, many of them.
HUNT: Let me ask you about immigration. Do you think that Speaker Boehner will permit a vote on immigration to be held, if a majority of his caucus does not support a bill? And would you support any bill that doesn’t have a pathway to citizenship?
VAN HOLLEN: Well, first of all, I think a bill needs to have a pathway to citizenship. I think there can be lots of hurdles along the way -
HUNT: But that’s the bottom line?
VAN HOLLEN: - those that have been laid out by the president. I think people need to get to the back of the line, and certainly can’t cut in front of people who are going through the normal process, and all the other conditions that people have heard, penalties -
HUNT: But some pathway?
VAN HOLLEN: I think there should be a pathway. Otherwise, you end up with a system where you have sort of, you know, two classes of people in the country. I think Speaker Boehner will - - will allow a vote ultimately. Assuming the Senate passes a bill -- and Speaker Boehner has already said, you know, Senate, you’ve got to go first, we’re not acting. But assuming the Senate, on a bipartisan basis, passes an immigration reform bill, I believe there are enough voices in the Republican caucus in the House that would insist on bringing that bill to a vote, along with Democrats and the public, even if a majority of the House Republicans didn’t support it.
HUNT: Congressman, one of the many hats you wear is the chief advocate of campaign finance reform in the House of Representatives. I want to talk about Organize for Action, the Obama-related political fundraising committee. No limits on contributions. Corporations can give money. They said bundlers have a minimum of $500,000. In return, you get quarterly meetings with the president, and they won’t disclose the exact amounts that are given. Does that bother you?
VAN HOLLEN: Well, I always have believed that total disclosure is -
HUNT: But is everything that they’re doing, OFA is doing, does that bother you?
VAN HOLLEN: My understanding -- and I will go back and check -- is that they do intend to disclose the contributions -
HUNT: Not by -- not by specific amounts.
VAN HOLLEN: Well, that -- I would -- I would far prefer --I believe that everybody should be disclosing. That’s why I introduced the DISCLOSE Act to do this. Now, I also understand that people say that, you know, they want to play by the same rules, which is why we should change the rules by adopting the DISCLOSE Act -
HUNT: But how about -
VAN HOLLEN: - to require that kind of disclosure.
HUNT: - a group -- a group so closely entwined with the president raising big corporate money and big -- and big rich special interest money? Isn’t that exactly antithesis of what you want?
VAN HOLLEN: Well, I want -- I want disclosure at a minimum. And so I would urge them to have disclosure. My understanding is that they were going to disclose, so I’ll have to look more into it.
But let me say one thing. Mitch McConnell, the Republican leader in the Senate, has been on a warpath against the idea that the public has a right to know who’s funding all these campaigns. And the president supports the DISCLOSE Act. And so let’s get that act done. Then everybody would be required to tell the American people who’s funding these campaigns and these ads.
HUNT: Chris Van Hollen, thank you so much for joining us.
VAN HOLLEN: Thank you.
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