Sen. John Breaux, D-La.

This is a partial transcript from Your World with Neil Cavuto, May 5, 2003, that was edited for clarity. Click here for complete access to all of Neil Cavuto's CEO interviews.

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NEIL CAVUTO, HOST: Well, the president wants that big tax cut. And he wants my next guest to want it, too. But does he? Joining us now is crucial senator, Louisiana Democratic Senator John Breaux.

Senator, good to have you.

SEN. JOHN BREAUX, D-LA: Good afternoon, Neil.

CAVUTO: Where do you stand, as things stand now with the president’s package, for or against?

BREAUX: I think, Neil, that we should be doing less negotiating at political rallies, and more negotiating around the table right here in Washington. I think that many of us, myself included, support some type of a tax cut. I think it should be around $350 billion. I don’t think it should include the dividend reduction, which is not going to create any kind of a stimulus in the short term. And I think we could probably find a way to reach an agreement, but not with what we have on the table right now.

CAVUTO: So I assume about what you are saying, if you had your druthers, no dividend tax cut, which would be enough essentially to pay for everything else that the president wants, speeding up all those tax rate reductions to this year.

BREAUX: Yes, Neil, I think there are a lot of things in the president’s package, suggestions that are good, speeding up some of the individual rates reductions is good.

CAVUTO: Wait a minute there, some or all, Senator?

BREAUX: Well, I’m flexible on doing it all. But I think we ought to concentrate on individual rate reductions, also do something on the child tax credit, the marriage penalty. I liked idea of the first $3,000 in wages being tax exempt for all wage earners. We need to do something for business in depreciation areas. But I think the biggest item, the elimination of the taxation on dividends is the most expensive, $400 billion, and it’s not going to be something that stimulates growth in the short term.

CAVUTO: What if it is phased in over a number of years, or for that matter, pared to a cut in the capital gains tax?

BREAUX: I think that the number we are looking at is about $350 billion. I think we can spend that amount of money more effectively and wisely by concentrating on the things that I outlined, and save the dividend tax reduction for long-term tax reform. I think we should do it. I think we should pay for it. Bear in mind that what we are doing is borrowing money to pay for a tax cut. I think on items like the dividend tax rate cut, we ought to try and find a way to pay for it.

CAVUTO: Let me ask you, Senator, there are many colleagues in your party who argue that any sort of tax cut of this magnitude, even the 350 billion you mentioned, is a give-away and a sop to the rich, I’m paraphrasing some of the Democratic presidential candidates who were debating this weekend, how do you reconcile with some of your more liberal colleagues?

BREAUX: Well, Neil, I think there are a lot of things we can do. Bringing up the all the rates forward helps everybody, excluding help on the marriage penalty, helps a lot of people, who are lower income people. The child tax credit helps a lot of moderate to lower income people. There are some things that we can do to put dollars into pockets of people who are - who need help right now. That’s what.

CAVUTO: So does that mean even the upper income folks, Senator, who feel that some in your party think that their cut should be postponed, you’re for just getting them all done now?

BREAUX: Well, I’m flexible on that. I think you can have all the rates brought forward as long as you keep it at a manageable level. I don’t want to get into, you know, income-bashing type of class warfare. But I think we have to be fair in what we do. I think we can have a good package for $350 billion. And we shouldn’t be fighting over whether it is 350 or 550. Let’s get something done and quit worrying about who’s fault it that a failure has occurred.

CAVUTO: Senator John Breaux, always a pleasure. Thank you, sir. Appreciate it.

BREAUX: Thank you, Neil.

CAVUTO: Senator John Breaux in Washington.

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