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Q&A: Chip Cravaack reflects on defeat, outlines fiscal cliff 'basics'

MinnPost photo by Paul Walsh
Rep. Chip Cravaack lost on election night to liberal former Congressman Rick Nolan by 10 points after a bruising campaign.

MP: What should a final deal to avert the fiscal cliff look like?

CC: Anything that does not hurt the economy. That’s the bottom line. It can’t hurt the economy.

MP: Could you define a package of what you think would hurt the economy would look like?

CC: If somebody can prove to me that raising income taxes would benefit the economy, I’ll be glad to take a look at it. But Ernst & Young came out and said, 'If you raise taxes on those making $250,000 or above, it’s going to be at the cost of 700,000 jobs.'

[Note: The Congressional Budget Office says raising taxes on incomes above $250,000 will mean 200,000 fewer jobs over what would happen if all the Bush-era tax cuts were extended.]

MP: Some Republicans from Speaker Boehner on down have said that they’re open to more revenue.

CC: But how do they do that? Closing loopholes, closing special interests, that’s another way of raising revenue. It’s so funny because, we demonize the 1 percent, when we’re the ones who are trying to close the loopholes on the one percent. The special tax incentives — why isn’t some major corporation not paying taxes? Allowing these current tax rates to expire isn’t the way to go.

MP: So we’re clear here, you seem to be OK with closing loopholes, but you don’t want to raise tax rates?

CC: I don’t want raise tax rates because … I was at London Rental in Duluth, and one of the CREDO guys [a super PAC that opposed Cravaack] came up and started hitting me on it. I said, show me data that says by raising taxes on income, we’ll produce jobs. I said, please send it to me, I’d love to take a look. Make an appointment ... in Duluth and I’ll come in and we’ll talk about it.

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Comments (5)

On that Ernst & Young study

relied upon by the Romney campaign in its closing days:

"Boehner is referring to a study prepared by two economists at Ernst & Young on behalf of pro-business groups: the Independent Community Bankers of America, the National Federation of Independent Business, the S Corporation Association, and the United States Chamber of Commerce — all of which lean strongly Republican. One of the study's authors, Robert Carroll, once worked in the Treasury Department under President George W. Bush.

Boehner accurately cited the figures in the report, but left out some important caveats.

Ernst & Young, July 2012: This report finds that the increase in the top tax rates would reduce long-run output by 1.3% when the resulting revenue is used to finance additional government spending. Employment is found to fall by 0.5%. In today's economy, these results would translate into a reduction of gross domestic product (GDP) of $200 billion and employment by 710,000 jobs.

There's an important caveat in there that some may miss; the projection assumes the revenue generated by raising taxes on those making over $250,000 would be "used to finance additional government spending." The report did not examine what would happen if the additional revenue were used to reduce future federal deficits. As we noted when the report was raised during the vice presidential debate, Moody’s chief economist, Mark Zandi, called that omission “odd” and said, “It seems to me that is the more relevant scenario. And my sense is that if they did, the results would be very different.”

In its analysis of fiscal cliff alternatives, the nonpartisan Congressional Budget Office assumed that "a significant part of the decrease in taxes (relative to those under current law) would be saved rather than spent."

http://www.tucsonsentinel.com/nationworld/report/111512_fiscal_cliff_fac...

Republicans claim we can

Republicans claim we can close the deficit without raising taxes which is actually possible and obviously not going to happen. Democrats claim we can close the deficit without raising taxes on the middle class or reforming entitlements which is not even technically possible. The last four years nothing happened to make either party admit they've been lying. I hope this election was the thing that will make it safer to tell the truth than to keep lying on enough people's part to get legislation signed. If I hear Barack Obama say that he'll veto any legislation that reduces access to Medicare or reduces social security benefits or if I hear John Boehner say that there will be no tax increase heard in the House then I'll get about as pessimistic about America's future as partisans have been, conditional on the other party winning its election.

still missing the point

Cravaack still thinks his internals showing him up 10 points were accurate. Talk about clueless. He squeaked out a win in 2010 against a long-time incumbent who got caught not paying attention to his race in a GOP wave year when DFL turnout in his district was extremely low. Two years later he was challenged by an energized opponent with deep ties to the district in a presidential year (which typically generates higher DFL turnout) who was capable of calling out Cravaack for his hypocrisy in complaining about Oberstar not spending enough time in the district...and then moving his family to New Hampshire.

Rick Nolan is much more in line with 8th District traditions, style, and politics. They wanted a Congressman who understood them and would be accessible by them (something Cravaack never was, unless you were Republican). They got one. Rick Nolan will be a great representative, as he was once before.

The fact that Cravaack is still wondering how he could have possibly lost tells me he's still locked in the GOP echo chamber. Time to get out.

Transition

I disagree with Cravaack on almost every issue. But it is refreshing to see a graceful exit by an incumbent 8th District Congressman. Jim Oberstar left a black mark on his reputation by his vindictive departure from Congress two years ago.

We could trust Chip - Nolan, not so much

This interview with Chip Cravaack was very gracious, unlike the bitterness of Oberstar two years ago. People of the 8th District trusted Cravaack to do what was right for the district and Minnesota. He made great strides in getting legislation passed to have U.S. made steel be used on our infrastructure projects, he brought the Iron Range legislative delegation together to support PolyMet and get this copper/nickel project moving forward, and he got legislation passed in the House to trade the School Trust Lands out of the Boundary Waters so they can generate revenue for all of Minnesota schools. Something that has been lacking for over thirty years.

Nolan, when he was in Congress back in the 1970s, went against DFL Oberstar's legislation to create a National Recreation Area in the central portion of the Boundary Waters where long established uses of logging, motorboats and snowmobiles had been a way of life and culture of the area. Instead, Nolan co-sponsored the Burton/Vento '78 BWCA Wilderness Act, which was pretty much written by the Friends of the Boundary Waters. He sided with the environmental bullies rather than with the people of the 8th Distrist. As a result, long established uses were restricted and logging banned.

Nolan cannot be trusted to trade the School Trust Lands out of the Boundary Waters, or to support the copper/nickel projects. These are two issues that the bully Friends oppose.