This is a rush transcript from "Hannity," April 9, 2009. This copy may not be in its final form and may be updated.
SEAN HANNITY, HOST: Welcome to "Hannity." I'm glad you're with us. Now, over the course of the past weeks and months, we have spoken at great length about problems with the Democratic Party's agenda, from economic recovery to national security to energy independence. Now many of those policies are now moving forward under the leadership of a new liberal president and his iron fisted congressional majority that will not even allow debate or amendments on some of the most important legislation in the last 30 years.
Now to defend their agenda liberals accuse Republicans of not having one of their own, they accuse Republicans of simply being the party of no.
(BEGIN VIDEO CLIP)
SEN. BARBARA BOXER, (D-CA): Clearly what you can see is same old same old same old. The party of nope. Nope, we can't change, nope, nope.
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: It's interesting to have a budget that doesn't contain any numbers. I think the party of no has become the party of no new ideas.
SEN. SCHUMER, (D-NY): And yet while President Obama shows leadership the other side is still adamantly sticking to policies that don't work.
(END VIDEO CLIP)
HANNITY: Now, tonight we expose their political strategy by giving you, the American people, real and practical ideas from conservatives. Now, we call them Six Ideas to Save America, and we offer them in the hope that each and every one of you will see that the Republican Party can still be one of ideas and one of principle if they stand by their conservative roots. Now, our list tonight is not all inclusive. We had to choose from many ideas on many topics, but for the purposes of this show we chose to focus on the domestic policy agenda.
• Video: Watch Sean's interview
And tonight we are starting with a conservative plan for economic recovery that won't bankrupt the futures of our children and our grandchildren. Republican Congressman Paul Ryan from Wisconsin, he now joins us. Congressman Ryan, good to see you. Thanks for being with us.
REP. PAUL RYAN, (R-WI): Good to see you, Sean.
HANNITY: All right, your tax plan is the antithesis of the Obama tax plan, and the Obama tax plan is the antithesis of Reagan economic model which led us to 21 million new jobs, longest period of peacetime economic growth in history, and the doubling of revenues for the government. Why don't you explain how you would go to opposite direction from Obama and not raise the top marginal rates, but lower them.
RYAN: We're basically saying let's go a completely different direction, let's get jobs back in this economy. A couple of things that are different than they were in the '80s. We're in the global economy and the 21st economy, and right now we're taxing our businesses so much more than our competitors are taxing theirs. And we're losing jobs. Our corporate tax rate is the highest in the world. So what we're proposing in our budget, in addition to all the spending control and the debt reduction we're proposing, based on the Obama budget, we're saying lower the top rates to 25 percent, for individuals, small businesses, and companies, and let's suspend the capital gains tax through the year 2010 so that we can actually re-grow the savings that people lost in their pension plans, their 401(k) plans, their college savings plans. These are the things we want to see come back, and the Obama administration is proposing to raise all of these taxes.
Raising taxes on the assets that make up our pensions, our savings, is not going to grow those back. Raising taxes on small businesses is not going to create jobs. And keeping taxes high on businesses so that we're taxing them more than our foreign competitors are taxing their own businesses is not going to get jobs back in this economy. We know from good economics we're going to produce more jobs. We even have economic modeling that shows we're going to produce a lot more jobs than the president is, and the difference between our budget and his, not just in taxes, is we're not proposing this gusher of new spending and this gusher of new borrowing that he is proposing in excess of the $1.5 trillion tax increase that the president is proposing.
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HANNITY: The question is that elections have consequences, Congressman, the Republicans lost, and now you don't have the votes to get this passed. The question is can you peel away enough Democrats, Blue Dogs and maybe some Democrats in the Senate that are really scared to death by $4 trillion in debt on top of a stimulus on top of a TARP on top of an omnibus on top of earmarks. You think you can peel away enough Democrats to help you out in this cause?
RYAN: Right. So three things we need to do. Number one, tell the truth, number two, provide an alternative and a choice. We've done that. We haven't had luck with the Blue Dogs yet. We haven't had luck with getting the centrist Democrats to stick with us, so far they've been in lockstep with their leadership, but we've got a few more chapters to play out in this thing, and the Blue Dog Democrats, in other words, the people who call themselves Blue Dog Democrats, they have the votes and the numbers to stop this from happening. The question really, we don't know, but so far they've been pretty lockstep with Nancy Pelosi and Harry Reid.
And we'll see.
HANNITY: For the latest year that I've seen numbers for which is 2006, the bottom 50 percent of wage earners only pay 2.9 percent of the federal tax bill. The top 10 percent pay nearly 70 percent of the bill. The richest one percent paid nearly 40 percent of the bill. And so we already have redistribution. We already are spreading the wealth around. At what point do those people that have money say forget it, I'm not going to invest anymore or I'm going to take my money overseas?
RYAN: That's the whole point. The more you tax somebody on their next dollar, the less likely they're going to go and work for it, the less likely they are going to take risks. We need people to take risks. We need people to start small businesses. We need entrepreneurs to come up with new ideas. If we say to them we're going to raise the hurdle rate, we're going to make it harder for you to achieve that success, there's going to be less success in this country.
The president and Democrats in Congress are doing a very good job of playing the class warfare card. Playing on people's emotions and fear and envy. It may be good politics but it's really bad economics. It demoralizes the successful small businesses that are out there, and it hurts those people who want to become successful small business people. So the problem is...
HANNITY: What — finish your thought.
RYAN: The problem is when we're saying that we have to hit the rich, soak the rich, we're already soaking the rich. The problem is the people who pay these taxes are the small businesses. Seventy percent of our jobs come from these small businesses, and when we demagogue them and we demonize them, we're going to hurt our chances of having more of them, and that means we're not going to have as many jobs.
HANNITY: You talk about the demonizing, this has become a mantra, tax cuts for the wealthy, Republicans don't care about the poor. They've been very effective in their bumper stickers and slogans and propaganda. How do you convince people that this benefits everybody, that you're going to let people or incentivize people and give people back more of their money, how do you say that that helps everybody in America when the Democrats are out there saying you don't care about the poor which I know is a lie, but what's the answer?
RYAN: Well, look, what we're proposing is we're going to give taxpayers a choice. You can have the current tax code with all of its loopholes, bells and whistles, or if you want a simplified system that fits on a postcard, two rates, 10 percent and 25 percent, it's progressive, generous and personal standard exemptions, but no other loopholes and exemptions you can have this simplified system. It fits on a postcard. We're giving the taxpayer the choice. Which system do they want? The one with all the loopholes and deductions or the simplified system with the lower tax rates?
HANNITY: The only way that this is politically viable is if Republicans get control of Congress. Look, I like this. The current system is too complicated, there's too many loopholes. You're keeping it really, really simple, 10 percent on joint filers with incomes of $100,000 25 percent on income beyond that. Alternative minimum tax eliminated. Eliminate taxation on capital gains and dividends. I think that would jump-start and put a jolt in the economy, economic growth, but the only way this is really going to happen is if you guys win in 2010, so there's a political component, and so you've got to educate people in the process.
RYAN: You can't win unless you have an agenda to run on. You can't win unless you show the American people we have a pathway for keeping America's prosperity, and the one thing we need to stop before we win is to prevent these massive tax increases on our savings, these massive tax increases on our small businesses from occurring, because that's going to hurt our prosperity, it's going to hurt our jobs, and it's going to cause us to borrow even more money.
We have never seen this kind of borrowing. It's going to hurt our currency, it's going to hurt the next generation, we want to grow our economy, so we're going to stop the tax increases first, and they we need to reform our tax code to make it easier for us to create more jobs in America.
HANNITY: Are Republicans willing to stop the earmark spending? Can Republicans at least put out a piece of paper and pressure Republicans — I'd like to see a new contract, and item number one is national security, item number three is energy independence, item number two is fiscal responsibility, and every Republican pledged not to accept a penny in earmarks.
RYAN: I'm one of those Republicans.
HANNITY: I know you are. But for those Republicans that maybe are wavering, we'll let everybody know where they stand. Is that a good idea?
RYAN: I agree with you. That is a good idea. It's an idea I've been pushing in our conference. Our Republican budget has energy independence, tax reform, it cuts our deficits, it cuts our debt, and it proposes an earmark moratorium as well.
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