California congressman voices concerns about tax policies

This is a rush transcript from "Your World," January 11, 2018. This copy may not be in its final form and may be updated.

TRISH REGAN, GUEST HOST: Wal-Mart announcing cash bonuses and wage hikes today, just another example of American workers benefiting from corporate tax cuts almost instantly.

But has this changed the Democrats' view of tax cuts?

We're asking Democratic Congressman from California Brad Sherman.

Good to see you, sir.

REP. BRAD SHERMAN, D-CALIFORNIA: Trish, thanks for having me on to talk about this deficit-exploding, job-outsourcing, economic disaster for our country.


SHERMAN: You're being fair and balanced.

When Tucker had me on to talk about nonsense, he promised that he would have me on once the tax bill was published. But he's been a coward every single time.

REGAN: Well, oh, dear.

SHERMAN: Because he knows he cannot defend this tax bill.

REGAN: Yes, that's not fair. Hey, that's -- come on now. That's not fair.

SHERMAN: Well, what is not fair?

REGAN: And you know what? You're here on this show right now with me.


REGAN: And we're going to talk about all this, because you think it's going to be painful for the deficit, et cetera.

It's funny how these talking points have kind of reversed, right, because I seem to recall that was a conservative talking point. But have at it, sir.

What is your biggest concern right now, especially when you look at Dow 25000, GDP growth better than 3 percent, unemployment at record lows and wages now increasing, thanks to hundreds of companies giving out wage increases?

SHERMAN: There are some small wage increases.

In some extent, these wage increases are just to match minimum wage statutes that have been passed in Democratic states. Wal-Mart says they're raising to $11 an hour. We require that in California.

And then they can say, well, it's because we love the Republicans. No, it's because California requires it.


REGAN: You know that Wal-Mart has actually given out bonuses to the tune of a grand, right, something that Nancy Pelosi calls just crumbs.

But $1,000 is a lot of money, sir.

SHERMAN: Well, if you look at the economy as a whole, with hundreds -- with well over 100 million employees, the fact that a few companies are giving a few bonuses doesn't disguise the fact that, when we have Democratic tax policies in force, we have much higher economic growth rates than when we have Republican economic policies and tax policies in force.

REGAN: Really, because over the last, what, eight years under President Obama, that didn't turn out so well. You had average growth of 1.5 percent. It should have been a whole lot better. But we had no economic policy out of the Obama administration.


SHERMAN: Trish, you have got to look at what tax law is in force, not who's sitting in the White House.

It took several years for Obama to change his tax policies. We have had Democratic tax policies with almost 2.33 economic growth. Compare that to the low economic growth we had under George Bush's tax policies.

Look at Reagans' and looks at Clinton's economic -- when their tax law was enforced and signed into law.


REGAN: You know that, Congressman. Clinton benefited from the tech boom. There was the actual structural shift in our economy at that point in time. And you know what? He wasn't able to sustain it.

SHERMAN: We had structural shifts in our economy at all times. And Clinton promoted that tech boom.


REGAN: Congressman, I guess I'm just troubled by...


REGAN: No, no, no, no, no, no, no, no.

You know what? Go read an economics 101 textbook. You can actually chart this stuff out. When you put more money in the hands of people and more money in the hands of corporations, the people and the corporations that are actually earning it in the first place, that equals growth.

SHERMAN: The last 30 years of history proves you wrong.

REGAN: No, no, no, no, no, no, no, no.

SHERMAN: When we have had Republican tax policies in force, we had lower economic growth.

REGAN: Look at what happened with President Reagan.

SHERMAN: And I'll tell you why.

Because you run that huge deficit. You think you're putting more money in the hands of people. But then the federal government goes into the capital pool and takes the money out.

We're going to be borrowing $1.7 trillion. That's taking money out of the economy, out of where it is available for factory expansion.


REGAN: Congressman, where are you going to get the growth? Where are you going to get the economic growth, sir?

SHERMAN: We had higher economic growth in 2016, in terms of jobs, than 2017.

But after we passed ObamaCare, after we passed Dodd-Frank, we suddenly had two million or more, almost three million in one, new jobs every year.

Now, that's peeled off a little bit with Trump. And it will peel off more.


REGAN: You're kind of all over the place.

You talk about ObamaCare, this from someone who's fiscally conservative, as you just suggested. You're so concerned about the deficit, yet you want more entitlement programs. I mean, it just doesn't make any sense.

SHERMAN: I'm not here talking -- did I say I was for more entitlement programs? I'm here to preserve Medicare and Social Security.

REGAN: You want more ObamaCare. You are telling me that ObamaCare was good for the economy.


SHERMAN: No, ObamaCare correlated with a great increase in the number of jobs created each year.

We were told it was a job-killer. But we had far more jobs created each year after it was adopted than before.

REGAN: Well, I think those numbers, sir, can be disputed.


SHERMAN: You can dispute them by -- you can have alternative facts if you want. But if you look at the official statistics of this country, you will-- and...

REGAN: I guess I just want to go back to what is happening right now, what is happening right now in our economy. Do you not like what you see?


SHERMAN: What? You're going to -- let's go through the list.

REGAN: I want to ask about here and now, OK, here and now. Do you not like what you see?

SHERMAN: Here and now, we created only two million jobs last year. We created 2.25 million jobs the year before.

After we adopted ObamaCare and Dodd-Frank, we created over two million jobs, the year before, only one million jobs. Those are the real facts, not the alternatives facts.


REGAN: The news today, the news that Wal-Mart is giving out bonuses.

SHERMAN: The news today is that Wal-Mart is closing 63 Sam's Clubs, and they didn't put that in their press release.

REGAN: Uh-huh. Well...

SHERMAN: You don't want to talk about the 63 Sam's Clubs and the thousands of people losing their jobs.

REGAN: Wait. Wait. Wait. Businesses close all the time, because you're not going to keep a store open in a community where it is not prosperous to keep it open.

SHERMAN: And bonuses are given all the time. That's why we have a Christmas and a New Year's.

That's the point. Bonuses are given all the time, close -- open all the time, close all the time. You can't attribute that to a tax bill.


REGAN: It's almost as though I fear some members of your party do not want to see this economy succeed, because, if this economy succeeds, people will credit Donald Trump with that. And you don't want that happening.

SHERMAN: We want it to succeed.

That's why we're there fighting to preserve Social Security and Medicare.
That's why we're there trying to make sure that we don't deport millions and millions of people.

REGAN: Nobody is taking way Social Security.

SHERMAN: That's why we're there not wanting the federal government to close down and the economic problems that would have.

We're working to improve the economy every day. And if America succeeds, everybody succeeds.

But you look at this tax bill, here's what it does for factories. You can have a zero percent tax on the profits of your factory only if you move it overseas. That's the offshoring provision of this bill.

Not only does it provide 85 percent of its benefits to the top 1 percent. It provides a 100 percent tax break for those who move their factories overseas.

Those are the facts. You can make up alternative facts if you want.

REGAN: There's $2.7 trillion sitting overseas, possibly more. There's now an opportunity to bring all that money back onshore so that it's working for us.

SHERMAN: Right. And we could have done that with Democratic policies as well.

REGAN: We need policies, sir, that make us competitive, competitive, because it is a competitive world out there. And America should lead the way on this. You know that. You know that.

SHERMAN: We are competitive because we have the best workers and the best entrepreneurs.

We do -- now we are competing for who can give the most money to the top 1 percent.

REGAN: But you want to stifle that -- entrepreneurs, then. You want to stifle that work ethic by taxing people more and more and more to cover your concerns about, your sudden concerns and recent concerns about debt.

SHERMAN: This bill raises taxes...

REGAN: Unfortunately, I am out of time. I got a hard commercial break coming up.

SHERMAN: I have been fighting for a balanced budget for a lot of years. I was part of the first balanced budget we adopted in the '90s.

REGAN: Representative, it's good to see you. I appreciate hearing your side.

Thank you very much.

OK, we're going to taking a quick break.

SHERMAN: I wonder if Tucker has the courage to do the same.


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