Rep. McCarthy on tax deadline: 'We've made great progress'
{{#rendered}} {{/rendered}}This is a rush transcript from "Sunday Morning Futures," December 10, 2017. This copy may not be in its final form and may be updated.
MARIA BARTIROMO, HOST: Good Sunday morning! Lawmakers are working to hash out their difference in the Senate and House tax bills aiming to get a final product to the president's desk before Christmas.
Good morning everyone, thanks so much for joining us, I'm Maria Bartiromo, welcome to "Sunday Morning Futures." What issues are critical to a unified bill that satisfies both chambers of Congress? House Majority Leader Kevin McCarthy joins me in moments. Plus more potential red flags in the Russia investigation. One Mueller investigator reportedly attended Hillary Clinton's party on election night. Will this boost the idea that this investigation is conflicting all around? I'll ask former Attorney General Michael Mukasey who will join me momentarily. And what's next after the Presidents Trump's decision to move the U.S. embassy in Israel from Tel Aviv to Jerusalem? Congressman Peter King on how it will affect peace efforts as we look ahead right now on "Sunday Morning Futures."
{{#rendered}} {{/rendered}}The push for tax reform now in the final leg of Congress, this is a big week. The House-Senate Conference Committee prepares to meet publicly on Wednesday to finalize a sweeping tax overhaul. There are several key differences between House and Senate versions. Like for example, income tax deductions and family tax credits. Joining me right now is the House Majority Leader Kevin McCarthy. Congressman, it's great to see you.
REP. KEVIN MCCARTHY, R-CALIF., HOUSE MAJORITY LEADER: Thanks for having me.
BARTIROMO: Thank you so much for joining us this morning. Can you talk to us about the status of this bill? You've been leading this conference this last week and now into this week. This is a big week for you.
{{#rendered}} {{/rendered}}MCCARTHY: It's a very big week but we've made great progress. Think of this. We moved to have house come back in. We weren't supposed to start until Tuesday of last week but we came in Monday just so we can move to go to Conference. The Senate do the same. So now the conferees are named. It's the way the Founders have create this country to work. The House and Senate have two different bills. Structurally they are pretty similar. They're going to work out those differences. Hopefully they can get that done this week. We come back the next week and vote on it.
BARTIROMO: The Committee for responsible federal budget has out with a lot of reports on the bill basically saying don't Let December be the debt- busting month. This could actually cost up to$2 trillion. How do you pay for it? You've been looking very carefully on ways to pay for this tax cut bill. Where are you finding it? Is there any wiggle room on this 20 percent corporate rate for example that is being discussed now? Some people are talking maybe you raise it to 22 percent from the initial idea of 20 percent. That gets you extra money to go toward other areas like state and local tax deduction elimination.
MCCARTHY: That's a place that we can always look at but the one thing that you do, both bills only write it to 1.5 trillion. And remember this. If we grow, four-tenth of one percent, you will pay for all of this. The debt that we have is one the most critical things we have to look after. But we cannot solve this debt problem without growing the economy. And that's why we wrote a tax plan that's pro-growth, creates more jobs, brings more money that's sitting overseas back into America, brings more companies that have left America back in to hire more people, and most importantly puts more money in American's paychecks. So I think we can achieve all of that and this is the first step in taking care of it.
{{#rendered}} {{/rendered}}BARTIROMO: And I -- and I totally agree that lowering the corporate rate from the highest in the industrialized worlds is going to move -- is going to move the needle on economic growth. I got you on that. The corporate tax cut, very you know, highly looked at as very strong but the individual side, that's where people say it gets messy because there are a lot of people who are going to get their taxes go up because of the elimination of the state and local tax deduction. So what I've been saying on the air a lot is why are you lowering taxes on people who do not pay taxes and raising taxes on people who do pay taxes knowing that 10 percent of the highest earners pay 71 percent.
MCCARTHY: And this is a very critical part and haven't come also from a SALT State California. I looked at this and went back. So the top 10 percent make 133,000 and higher in this country. So when looking at the tax bill, those individuals currently pay $2.54 trillion. The joint tax analyze the bill. For those who are making 100,000 or more, they'll pay 2.4 trillion. So the numbers say something different that they'll actually pay less. So when you lower the rates overall, everybody starts off with a lower rate meaning they have to pay less. Now when we close different items in there that you can make deductible, you have to look at the entire bill to see what you'd pay at the end to the day.
BARTIROMO: Are you -- you're right now trying to lower the top rate on individuals, correct?
{{#rendered}} {{/rendered}}MCCARTHY: There's couple of things I'd like to do especially coming from California in SALT. Inside our bill, we put $10,000 for property tax deduction. I would like to add income saying 10,000 for one or the other because there are some elements in California because of Prop 13, you that might not reach it on property tax but your income could. I would also like to raise --
BARTIROMO: So you can put -- you can put the $10,000 either to pay your property taxes or state and local --
MCCARTHY: Or income. On or the other.
{{#rendered}} {{/rendered}}BARTIROMO: Sorry, continue.
MCCARTHY: I would like to lower the top rate because I do not believe at the end of the day you should punish people for being successful.
BARTIROMO: Thank you!
{{#rendered}} {{/rendered}}MCCARTHY: Especially in SALT. And you knowing that, the 10 percent pay 70 percent but it's also the consumption and the movement of an economy. Now the Senate already has a lower rate in the House. I'd like to see if we could lower that more. And then when I looked at the mortgage, the House has one version of 500 and the Senate has a million. I'd like to see the Senate version make the House version go up higher.
BARTIROMO: So somebody asked-- somebody asked me earlier, is this $10,000 deduction for property tax, will -- could you do both 10,000 for property and 10,000 from state and local income taking that's a 20,000?
MCCARTHY: No I think what you do is 10,000 for one or the other or a combination of thereof. Remember what happens here thought too. We double the standard deduction so only one-third of America actually itemizes. Now you get to keep more of what you earn. An average family of four making $55,000 will pay zero tax going forward. So when you look at the entire bill, AMT, now this is a part in the Senate bill I'd like to see removed. In the House version, we eliminate the alternative minimum tax. So if somebody is paying the alternative minimum tax and SALT, that actually is a larger hit on your taxes than before so that saves you more money in the process. And in business, it would hurt business to keep the alternative minimum which the Senate does so I would like to see that eliminate --
{{#rendered}} {{/rendered}}BARTIROMO: So do think that you're going to get that? I mean --
MCCARTHY: Well, that's what we're working on in conference. These are some of the differences that we have but we've -- in the structure overall are very close, I think we come to a solution very quickly.
BARTIROMO: Let me ask you. I'm very surprised that nothing was done with carried interest, the carried interest deduction there. Because that states -- and that allows private equity managers, real estate developers, you know, certain people, high and rich people, to actually claim that certain income is capital gain and get a charge of 20 percent tax versus register 39.6.
{{#rendered}} {{/rendered}}MCCARTHY: No, it's not exactly the same as it was in the past and the House version, they extended that out. You have to invest longer and more years. So you're making a longer investment. And that's what entrepreneurship is, make a longer investment instead of one year into three years.
BARTIROMO: But if you got the left basically saying, hey, this is a giveaway to the rich and we know it's not, we know what the plan is and corporate rates coming down is very, very important but you've got this talking points on the left coming at you. I don't understand why you would leave carried interest deduction in there. It basically is for the rich. I mean, it's one of those places, what would that would get you $100 billion? What would that get you if you totally take that -
MCCARTHY: Well, I do not know exactly what it -- what it would actually score at. I don't believe that score is that high on the process especially --
{{#rendered}} {{/rendered}}BARTIROMO: OK, so it's not that much money then.
MCCARTHY: No, but the thing you have to remember. We focused on being pro-growth making America competitive, simplifying in the process and that's why you get the standard deduction. So come next February, everybody should check their check because their withholdings is going to be better. They're going to get more money in their paycheck starting out. And If the majority of money, you look at the survey, the people are fighting just for $400 every week. This will make the fundamental difference. And those are the Americans we really were looking at from the very beginning. How do we create more jobs? When we rolled this bill out, when had a company Broadcom who had left America announced they were coming back.
BARTIROMO: Yes.
{{#rendered}} {{/rendered}}MCCARTHY: With -- you know repatriation almost better than anyone. Think about those trillions of dollars that will come up to America, invest in American jobs and also, pay out to the dividends.
BARTIROMO: Yes, I agree.
MCCARTHY: Every step we've taken with taxes where we come closer, what's happened with the market? How many times have we set a new record in the stock market which I will say based upon the move we did with regulation and tax.
{{#rendered}} {{/rendered}}BARTIROMO: Totally agree! Yes, so is there any way -- is there any way this doesn't pass in the next two weeks? I mean, you're right, $6 trillion in market value has got a lot riding on this. People are expecting this to happen now. Now the market is pricing in a bit that we're going to have success here.
MCCARTHY: Look, I feel very confident we're going to get this done. I remember being on your show when we were worried about the Senate. The -- you will see in the news ups and downs as we go but at the end of the day, we're going to get this to the President's desk. He's going to sign it. And I've never watched the President so engaged. I was speaking to the treasury secretary last night. I talked to the President last week. He is engaged to make sure this happens because he wants to keep his promise to create more jobs and make sure that the middle class in this country gets an increase in their wages.
BARTIROMO: Do think you're going to be done by next Friday the 15th?
{{#rendered}} {{/rendered}}MCCARTHY: Well, think about how big of what we are trying to accomplish here. If we -- if we are successful inside the conference, I want to make sure you go through all of the Senate rules, could you cross your Ts, dot the Is, you print it out. I would probably think it would be the week after when you had vote. We want to make sure people can read this. I know we've been debating this for years. We've had it -- the bill laying out there so people can see and then read through it and it's going to stay between the two as soon as we can get it done.
BARTIROMO: Real quick before you go. You voted several times on moving the embassy from Tel Aviv to Jerusalem. The President made the announcement that he is going to do that this week. It's taken a while. Tell me -- give me the history on this.
MCCARTHY: Well the history is if you go back to almost any modern history President that was running, made this promise that they would. This is the first President who kept his promise. But as early as last June, even in the Senate, we passed a resolution unanimously that would move the embassy to Jerusalem. That is their capital. it is reality. It's common sense of what you're able to do here. And if someone kept a promise that shocked the world, I think President is going to keep his promise just as he kept his promise that we're going to get tax reform done.
{{#rendered}} {{/rendered}}BARTIROMO: Wow. If you get this over the finish line in the next two weeks, this is a huge thing for you. Congratulations!
MCCARTHY: Don't congratulate us until we get it done but we will keep working on it.
BARTIROMO: We will be watching this. This is a big piece of legislation and a great victory. Are you worried about 2018, the elections?
{{#rendered}} {{/rendered}}MCCARTHY: You know what, if worry about the election, you're not going to accomplish anything. Why don't you go accomplish things that you promised to do and go back to the voters and show what you're able to achieve, I think you'll get a good result.
BARTIROMO: That's what we'll be watching. Kevin McCarthy, good to see you.
MCCARTHY: Good to see you. Thanks for having me.
{{#rendered}} {{/rendered}}BARTIROMO: Thank you so much for joining us, Majority Leader Kevin McCarthy there. Mounting claims of bias meanwhile on Special Counsel Mueller's team with new reports of Clinton connections. Former Attorney General Michael Mukasey is joining me next on what his all means for the Russia investigation. Follow me on Twitter @MariaBartiromo, @SundayFutures, let us know what you would like to hear from A.G. Mukasey. He's next. We're looking ahead on "Sunday Morning Futures" right now.
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BARTIROMO: Welcome back. More Clinton connections emerging in the Russia meddling investigation. The Wall Street Journal is reporting that Robert Mueller investigator Andrew Wiseman attended Hillary Clinton's election party last November. This amid growing complaint of Republicans of bias in the investigation. Joining me right now is Judge Michael Mukasey. He served as the U.S. Attorney General under the George W. Bush administration. He is also a former Federal Judge. Judge, it's good to see you.
{{#rendered}} {{/rendered}}MICHAEL MUKASEY, FORMER UNITED STATES ATTORNEY GENERAL: Thank you for joining us this morning. So what do you make of all this? I mean, first of all, you've got these investigators who investigated Hillary Clinton. They went to her party. They were partying up the storm together and then he's actually interviewing her for the FBI. You've got Michael Flynn pleading guilty to lying and yet, Huma Abedin and Cheryl Mills lied to FBI, no problem there. Is this investigation a sham?
MUKASEY: I do not think the investigation is a sham. And obviously people have -- everybody has got an opinion, a political opinion some of them. It's perfectly fine to have a political opinions but when you start expressing them in public, if you're a public official, that gets dicey. And most people I think in public jobs know that. Everybody in the public job has an opinion but not everybody in the public job goes around expressing it and goes around expressing it in the form of attendants at rallies or making contributions.
BARTIROMO: But it is pretty extraordinary though to see Mueller's team. I mean, he had to fire one of his agents and actually he wasn't fired. He now works in the H.R. division of the -of the FBI but he took him off of the investigation because he was found out to be sending anti-Trump texts to his girlfriend. So what you do about a politicization of the FBI?
{{#rendered}} {{/rendered}}MUKASEY: Well, you expose it and you stop it. I think that the problem with the way lawyer who attended -- who attended a rally, Andrew Wiseman --
BARTIROMO: Right, Andrew Wiseman.
MUKASEY: -- is a lot -- is a lot deeper than just attending a party. He participated in the Enron investigation. And every single criminal trial in that case that ended in a conviction was reversed either entirely or in part on appeal. And in large measure, particularly with the Arthur Andersen conviction that resulted in destruction of an accounting firm, reversed by the Supreme Court because he had pushed the obstruction statute too far. He was responsible for that. And he is, guess what, investing a case that is alleged to involve obstruction. I don't know that I'd rely on his judgment and how far you go with the obstruction case?
{{#rendered}} {{/rendered}}BARTIROMO: That is interesting. You know, people do not understand the Enron background there that everything was turned around.
MUKASEY: Not everything but many things and there was no conviction after a trial that stood completely.
BARTIROMO: So what should be done here in terms of the Robert Mueller investigation? I mean, every day we hear more interviews being done. Hope Hicks, the P.R. woman at the White House, people that you know -- and the media is getting it wrong. You saw the hysteria a week ago that the President directed Michael Flynn. Now we learned that it was in December, a month before he's about to take office. Is there anything that should be done right now in terms of this Robert Mueller investigation where they are continuing to look for collision that we all know does not exist?
{{#rendered}} {{/rendered}}MUKASEY: I think that the best thing to do is wait for the outcome and not engage in fevered speculation about what the outcome might be.
BARTIROMO: But Judge, when is the outcome? I mean, this has been going on a long time. How much is this costing American taxpayers, tens of millions of dollars?
MUKASEY: It's causing quite a lot but also in a lot in terms of diverted energy and attention. And I think that's you know, in a way, a higher price to pay in terms of our politics.
{{#rendered}} {{/rendered}}BARTIROMO: So what's your whole assessment of this thing?
MUKASEY: Well, I think we have to wait to see where, if anywhere, it goes. But I'm hoping that in the end, Mr. Mueller lives up to a lot of the advance notice about his reputation and has the courage to say if there's nothing there, that there's nothing there.
BARTIROMO: Christopher Wray testified last week. The new FBI Director and was asked about politicizing happening at the FBI. Here's what he had to say. Listen to this.
(BEGIN VIDEO CLIP)
CHRISTOPHER WRAY, DIRECTOR, FBI: As I sit here today, I am not aware of, since I've been on the job, there's been no effort that I've seen going forward here any effort to interfere with Special Counsel Mueller's investigation.
(END VIDEO CLIP)
BARTIROMO: Truthful? Should we trust this?
MUKASEY: Yes. The -- he says no effort to interfere with Mueller's investigation. That's pretty innocuous.
BARTIROMO: Right.
MUKASEY: There should be --
BARTIROMO: The bigger story is are they looking at the right things? Are they investigating the Clinton team? I mean, we just talked about the fact that Cheryl Mills and Huma Abedin lied to the FBI and Cheryl Mills got immunity.
MUKASEY: That response didn't speak to that at all. That response simply spoke to what's going on now in an effort or absence of effort to interfere with the investigation. The answer, nothing.
BARTIROMO: But what about the Clinton -- but what about the Clinton investigation? Is there one or are we just going to keep turning over rocks looking for collision with Donald Trump?
MUKASEY: I think it will be interesting to find out what Chairman Nunez discloses in the investigation that his committee is carrying on which is going on fairly quietly but steadily. And I think we're going to find out quite a bit.
BARTIROMO: There is an effort though to keep that aside, keep it under wraps, keep this whole Clinton part of the investigation under wraps, frankly. And so the American people don't really understand what's happening with that. You're saying that we will, that investigation will yield important results.
MUKASEY: If the -- if the investigation is ongoing it belongs under wraps.
BARTIROMO: Right. OK. But in the meantime, all we hear about is Trump and potential collusion with Russia. I understand it's all speculation.
MUKASEY: It's all speculation and if you look at it, it is all hot air.
BARTIROMO: Yes.
MUKASEY: So you know, it's -- you can't censor people in the media from talking about and speculating about what they want to talk about speculating.
BARTIROMO: When would you expect news from this Nunez investigation?
MUKASEY: I don't know but I do expect at some point that there will be news.
BARTIROMO: Attorney General it's great to see you.
MUKASEY: Good to see you.
BARTIROMO: Thank you so much, A.G. Michael Mukasey, there. Protest turning deadly near the Israeli-Palestinian border meanwhile after President Trump recognizes Jerusalem as the capital of Israel. We'll get to it next, stay with us.
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BARTIROMO: Welcome back. 14 members of the United Nations Security Council condemning President Trump's decision to recognize Jerusalem as the capital of Israel. Deadly clashes between Israelis and Palestinians this weekend. President announced also included plans to begin moving the U.S. Embassy from Tel Aviv to Jerusalem. A process Secretary of State Rex Tillerson says will take at least two years. Congressman Pete King says this. The decision was not easy and there is no guarantee of success but it was the right move at the right time. The Congressman joins me right now. He's a member of the Intel and Homeland Security Committee. And Congressman King, it is always pleasure to see you. Thanks for joining us.
REP. PETER KING, R-N.Y.: Thank you Maria. Maria, can I just say at the start, I agree with everything that Attorney General Mukasey said. I think there had been mistakes form this investigation, but I think the worst think a person could do right now is to remove Mueller, not because he's doing such a great job. With the President's lawyers are confident, this is going in the right direction. I don't want to give the Democrats and the media an opportunity to blow this up and come up with another phony issue.
BARTIROMO: I totally understand that.
KING: (INAUDIBLE)
BARTIROMO: You know, I'm glad you did and I totally understand what you're saying but the bottom line is Congressman, it's getting really to constantly hear Robert Mueller call people into his office to interview. Hope Hicks really? Come on! Donald Junior, all of these interviews and then in the media speculates as if there was this major Watergate scandal going on when everybody knows if there was any collusion between Donald Trump and the Russians, it would have been linked a year ago.
KING: Yes, I was at the interview with Donald Trump Jr. and I can tell you he answered just about every question. The, once he didn't, were very precise technical reasons. Nobody listening to that interview can come out of that thinking there was any collusion at all. It is totally -- I don't want to give them a chance to talk about another Saturday night massacre, another special counsel dragging on. If the President's lawyers are confident it's going in that direction, I think it's better to just go along with it right now and get it wrapped up and over and done with.
BARTIROMO: I totally understand that but people also want to see justice on the other side, Congressman.
KING: I agree.
BARTIROMO: We know that Cheryl Mills got immunity and she lied to the FBI. We know Huma Abedin lied to the FBI, and we know Loretta Lynch told her deputy, Jim Comey running the FBI to call a criminal investigation and matter. People want to see justice Congressman.
KING: I agree with you totally and I'm on the committee investigating the uranium deal and I believe that once the collusion issue is out of the way, we can really focus on everything that happen in the Hillary Clinton investigation. Why Comey did what he did? Why there are investigators involved in that? Why is there a pro-Clinton bias? What happened with Cheryl Mills? What happens with Huma Abedin? But it would be a lot easier to get that message out once we get this collusion phony issue out of the way.
BARTIROMO: So you think you're on the committee overseeing the uranium investigation, you think we're going to get into that in 2018 then?
KING: It has already started. I can tell you it started. Yes, we started --we're talking, we're drawing the background. We're going to be talking to witnesses. Yes, this is going ahead.
BARTIROMO: OK. Let's move on to the other big story this past week and that is the President recognizing Jerusalem as the capital of Israel. Here's what he said. Listen to this Congressman.
(BEGIN VIDEO CLIP)
PRESIDENT DONALD TRUMP: It would foully to assume that repeating the exact same formula would now produce a different or better result. Therefore, I have determined that it is time to officially recognize Jerusalem as the capital of Israel consistent with the Jerusalem embassy act. I am also directing the State Department to begin preparation to move the American Embassy from Tel Aviv to Jerusalem.
(END VIDEO CLIP)
BARTIROMO: So there you go. I understand the reasoning. I mean, two presidents before President Trump have said they would do this and they never did it. As you just heard Kevin McCarthy say they voted on it certainly even in the Senate. They voted to move the embassy and it was never done. My only question is Congressman, why now? The President has so much on his plate right now. You've got North Korea in one corner, ISIS in another, a tax plan hanging in the balance, why did he have to do this today?
KING: I think the President feels he can work with a full-court press. He can do many things at the same time. And I think it was the right thing to do because first of all, a peace process, there is none right now. It's a total impasse. If there's one at all, it's (INAUDIBLE) it's status quo, nothing is happening and there is violence. I think this one will help -- this could help to jump-start the peace process. Also if you notice, there's been a very muted reaction from the Arab governments. I know they have to make some pro forma statements but listen, they would much rather have President Trump playing an active role in the Middle East than went on during the Obama years where Iran was built up, Israel was sold out, the government of Egypt was overthrown, President Obama withdrew his pledge in Syria.
He put people like King Abdullah on the line to supporters in Syria then he invited the Russians instead. So no, listen, on balance, this is the right thing to do. There's no guarantee it's going to work but I really think that something was needed to be done so that the Palestinians know yes, we are standing strongly with Israel but we are willing to be and honest broker. And for these European countries that complained about us somehow setting the peace process, what have they done for the peace process over the last 50 years? France and Germany, what have they done?
BARTIROMO: Well, that's a really good point. And by the way, on the peace process conversation, I just got back from Saudi Arabia and I couldn't believe the mentality and sentiment in Saudi about stopping out terrorism. I mean, the Crown Prince, the future king told me directly we're going to get extremists down to five percent of this country in the next couple of years. Then he turns around and he interests all of these princes, royal family members who he says got their money you know, fraudulently because they were funding terrorists. So -- and then to hear the Crown Prince align Saudi with Israel. Congressman, that's pretty stunning.
KING: Nobody would have thought 20 years ago that you would have so many prominent Arab leaders openly and very much behind the scenes working with the Israelis. Right now the Saudis, Jordanians, UAE, Egypt, these are countries that certainly (INAUDIBLE) Israel. They've ever been and anyone couldn't even anticipate it years ago --
BARTIROMO: Congressman before you go, I got to ask you about taxes. You voted no on the tax plan. You just heard Kevin McCarthy, he said no, you're not talking about $10,000 for property taxes and another $10,000 cap for state and local income. He says it's one $10,000 property cap and that's going to -- he's hoping to be able to put toward property or state and local income. I know we're getting into the weeds a little here but what would it take for you to vote yes on the final bill?
KING: If they -- if they can get that to 20,000 using 10,000 involved. And I will tell you, I'm right now calling on the President if he can meet with the New York Republicans on this issue to take one final shot. He's a New Yorker, he's a guy from Queens, he's the guy who understands what this is about. So, Mr. President, we would love to sit down with you. Lee Zeldin, Dan Donovan, Elise Stefanik, John Faso and I would love to have 10 minutes of your time to get this resolved.
BARTIROMO: Would Kevin McCarthy just say he's trying to get the top breakdown. He wants to get the top rate, now at 39.6. He wants to get it to 35 percent. That's what he's pushing for this upcoming week as he deals with his colleagues in the Senate. Would that offset enough for you?
KING: Not really. That would not affect -- listen, I'm not opposed to that. But having said that, I want to make sure that the middle-income voters and constituents in my district don't get hurt badly and softer where they would be.
BARTIROMO: Of course! Congressman, it's great to see you as always. Thank so much!
KING: Maria, thank you.
BARTIROMO: Happy Holidays, Merry Christmas to you. A Christmas deadline approaching for Congress --
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BARTIROMO: Welcome back! It is a big week ahead for the Republican tax reform effort and the market as the House-Senate Conference Committee begins meetings to iron out differences between their respective tax bills before they leave towards the holiday winter break. I want to bring in Illinois Congressman Peter Roskam right now. He is a Member of the House- Senate Conference Committee on the GOP tax bill. And Congressman it is good to see on the program this morning. Thanks for joining us.
REP. PETER ROSKAM, R-ILL., HOUSE-SENATE CONFERENCE COMMITTEE: Thank you, Maria. Thanks for having me on. It's great to be with you.
BARTIROMO: Can you walk us through the status for us. Can you give us the status check in terms of what you need to iron out this coming week? What are the last remaining sticking points, Sir?
ROSKAM: So here's what we've got to figure out. We've got to come to some agreement on how both of these bills treat pass-through entities that as businesses that are treated, pay taxes at the individual rate. How do we deal with that? We got to figure out how we deal on the international side in particular. There have been two visions of that. Both the House and the Senate have approached it differently. We've got to figure out how to give more middle-income tax relief and everybody's working on that. And then we also have to figure out how do you reconcile things on the estate tax and bring the child tax credit into harmony. There's other things as well but those are the top line -- the top line efforts. And I'm confident that we're moving in a direction that can get done.
BARTIROMO: Do you -- would you mind doing a corporate rate of 22 percent for both pass-throughs and corporate rather than 20 percent corporate, 25 percent pass-throughs which was what was initially in House bill? Do you think we could get to a place where it's 22 percent on both?
ROSKAM: Well, we passed the 20 and 25 for a reason. And the reason is corporation C corps are double taxed. So they pay income tax and they also pay dividends when the money is taken out. So you're getting more or less business parity at 20 and 25. But that said Maria, look, there's a lot of numbers that are in play right now and there's a disposition among the conferees of trying to get to a yes on these things. And I'm confident that we're going to be able to get that done.
BARTIROMO: Look, I recognize that the debt is a serious issue here. $20 trillion in debt and the deficit is going to go up likely over the near term because this plan is causing $1.5 trillion. Maya McGuiness from the Committee on Responsible Budget says it could actually ultimately cause $2 trillion. So you're looking for different areas to take money from to pay for this. I'm scratching my head wondering why carried interest was not touched. I understand there's not a lot of money but why do you still have carried interest deduction in there which allows some managers, hedge fund managers, private equity executives to claim a 20 percent tax rate when in fact, some people say that should go to the high rate of 39.6.
ROSKAM: So I'll answer the carried interest question. Let me get to the debt question because there's a relationship. So first of all, we are borrowing money intentionally in the same way that you borrow to buy a house, you borrowed to put it in your business, you borrow money to get something for it that's increasing in value. And here we're getting two things. Number one, we're getting a new tax code. We're just buying a brand-new tax code which is a terrific thing for all the obvious reasons. The other thing is we're buying a more robust economy. So I do not by the notion that this is somehow going to cost to 2 trillion and then we could get in to sort of all the budget math. I think it's likely a trillion.
So on carried interest. Look, there's -- nobody is doing a candlelight vigil or a hunger strike for people at the very top end of the economic chain. But my point is, we've got to be very careful that this blowing up carried interest, for example, can have an adverse impact on modest real estate deals out in my constituency in suburban Chicago where you've got a developer and so forth that are coming together and trying to align interest. The name of the game we've chosen in this to lengthen the duration of the carried time. To your point earlier, it does raise a lot of money if you abolish it. And what we are trying to do is to create growth and lien in and ultimately have an economy that can be transformational.
BARTIROMO: So what you're saying is those deals in real estate that could go away because they don't have the carried interest 20 percent rate. That is more important than the fact that you eliminate the state and local tax deduction and you're going to see an exodus of people out of high tax states like New York. Don Peebles on the other day on "MORNINGS WITH MARIA" the Fox Business Network told me he's expecting real estate prices to drop 10 percent in New York because of the exodus of people that are going to leave because they are losing that deduction. So that carried interest is more important than that then?
ROSKIN: Look, I think the hyperbole and the overstatement and the over- characterization about all these negative things that are reported to happen if we move forward on this, is a hidden blessing because those things are not going to happen. What is going to happen? Is this economy is going to grow in ways that we've not seen in a long time. I'm from a comparatively high tax state. If all you're doing is evaluating one deduction that is state and local tax deduction and not looking at anything else, then yes, the criticism is valid. But this has to be evaluated in its totality. Look at the rates. Look at what is happening in terms of child tax credit, the new family credit and all of the other businesses things that are happening --
BARTIROMO: Well, I'm glad you mention the family credit Congressman because I don't --this is another head scratcher for me. Your spending $650 billion on a family credit, a family tax credit that goes to all families? So even a very rich family that doesn't need any more deductions? You're going to give them the family tax credit? Somebody who's a well means on the high-end get the same tax credit that somebody on the low end gets?
ROSKIN: So now everybody is arguing the alternative because on the one hand there's a criticism that we're not doing enough and on the other hand, there's a criticism that we're doing too much. And to your point, what we're trying to do is figure out --
BARTIROMO: I'm just looking for money -- I'm just looking for money to pay for --
ROSKIN: Right. And what we're trying to do is figure out where do these things, where should they phase out, what's an appropriate level? And these are all of the things Maria, that the Conference Committee is dealing with. Adjusting these dials so that you create a tax code that people say, yes, I have confidence in that. Yes, I want to invest in that. Yes, I'm getting tax relief that I need.
BARTIROMO: Are you going to put a cap on the family tax credit in terms of income?
ROSKIN: Well, we'll see. I mean, these are all parts of the discussion that the Conference Committee is dealing with. So I'm not going to get ahead of the conferees. I'm not going to get ahead of my Chairman but there's a number of these issues that are obviously part of a discussion right now trying to figure out how you ultimately put this together. Because I tell you what, you can't go back. The notion of saying, well, look, it's just too big, it's too complicated and it's too much of a hassle. It's ridiculous. We've made a decision. Everyone has crossed a Rubicon and we've said we've crossed over, we're going to get this done and we're going to get this done.
BARTIROMO: All right, Congressman, we know you're working hard on this. We appreciate it and we know we're going to see an impact on the economy. Good to see you, sir. Thank you.
ROSKIN: Thank Maria.
BARTIROMO: Peter Roskin joining us there. The Alabama Senate Race, there's that story coming down to the wire. The race is on Tuesday. Polls are showing a dead heat between embattled Republican Candidate Roy Moore and Doug Jones. How President Trump is stepping up into help? We're looking ahead right now on "Sunday Morning Futures" ahead of Tuesday's election. Back in a minute.
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BARTIROMO: Welcome back! We are just two days away from the hotly debated special election for Alabama Senate Seat. With a two-seat GOP majority in the Senate, this race means a lot to the President's agenda and tax reform too. Mr. Trump recorded a last-minute robocall for Roy Moore. His most direct involvement in the race yet. I want to bring in the panel on that. Ed Rollins is Campaign Manager and White House Adviser to President Reagan, Mary Kissel of the Wall Street Journal Editorial Board, both Fox News Contributor. It's great to see you both.
ED ROLLINS, FOX NEWS CHANNEL CONTRIBUTOR: Thank you.
MARY KISSEL, FOX NEWS CHANNEL CONTRIBUTOR: Good morning Maria.
BARTIROMO: Smart conversation right here. Your thoughts ahead of Tuesday?
ROLLINS: I think that Moore ends up winning it. I think it's been a very contested race and unfortunately, it's become a black and white race in the last closing days here. The black community obviously is very opposed. Whether they turn out or not, the Christian coalition will turn out. So I think that will give Moore his victory.
BARTIROMO: Some people say, Mary, the Democrats win either way because if Roy wins -- Roy Moore wins, it's just sort of a black mark on the Republican Party and if he loses, the Democrats win.
KISSEL: Well, if Roy Moore wins, I think there's a short-term costs and there are long-term costs. Look, immediately, the GOP loses whatever moral high ground it had when it comes to the treatment of women. He's been accused of misconduct with girls as young as the age of 14 which is disgusting and why Richard Shelby the other Alabama Senator has come out and denounced him. But you know, also, if he stayed in the Senate Maria, I'm not sure that he's a great help to the Republican Party that the President thinks that he's going to be. I mean, this is a guy who's very close to the trial bar and he's also somebody who was removed from the state Supreme Court twice.
So that doesn't exactly show good judgment and I'm not sure that he would be that vote that the President thinks that he needs in the Senate. And longer-term also, next year's election, what is that going to do to the GOP nationally? He's going to be the new Todd Akin. Democrats are going to wrap him around the neck of every Republican newsroom.
BARTIROMO: Yes, and that's why they pushed Al Franken out. They want to make sure, they're taking the moral high ground on this.
ROLLINS: No offense to my friend here. Obviously, she's an economic expert, I think I know more about Politics. Todd Akin never been became an issue. If anybody lets Roy Moore become an issue, if you're one of the Republicans running for election, or the25 running as challengers, you run your own race. The bottom line here is this man has some charges made against him and never been approved. He's run five times statewide, he's got elected four times with those statewide and twice he was elected and lost two governor's races. These charges never come forth including the President (INAUDIBLE) who he ran against.
BARTIROMO: How about Ivanka Trump coming out so early in tweets saying there's a place in hell for anybody --
ROLLINS: Well, I agree with that. If the charges are real and then that's fine. But the bottom line here, this is allegedly 30 or 40 years ago. They have never backed up. The Washington Post walks in and interviews 30 people in the south and finds them after five campaigns including a $10 million primary race against him. So I'm not saying that he's innocent or guilty. I'm just simply saying the voters of Alabama who know this man well. The issues --
BARTIROMO: You want due process?
ROLLINS: I want due process. The issues are equally important. The issues that he's been (INAUDIBLE) he's been very active against the gay community. He has been very active against -- he's a fundamentalist religious and that's a very important element to this party. He will be a safe vote for the next four years and that's a four-year vote, this is a four-year term.
KISSEL: Well, I don't know. The allegations particularly by the 14-year- old --
ROLLINS: Unproven!
KISSEL: OK, look, there are two ways to judge candidates. One is in the court of law and the one is in the court of politics. And he's lost there in the public opinion. Todd Akin never made it to the Senate. Imagine that Roy Moore does make it to the Senate. He is already -- look, and also to be fair, the politics in Alabama are not the politics nationally.
BARTIROMO: That's true.
KISSEL: And there are a lot of people out there including myself who are disgusted by these allegations. And look, what kind of guy --
BARTIROMO: (INAUDIBLE)
KISSEL: And gets banned from a mall because he's lurking around there talking to young women.
ROLLINS: First of all, the person who made that charge -- the person that made the charge has now basically said the charge was false. I did not make it. It was a woman --
BARTIROMO: Well they did (INAUDIBLE) the yearbook. We know that.
ROLLINS: I'm just saying -- I'm just simply saying that charges -- let the people of Alabama make the decision. He's been around the game for 40 years. They know who he is. Why would -- why would he be such a significant leader in a Christian right community as -- if these charges are valid.
BARTIROMO: And the Presidents tried hard not to stick his neck out. And then at the end of the day, did the robocalls. Look, we got to get to taxes. I got to get your take on this tax plan. The tax reform clock is ticking. The House and Senate are in conference this week starting to iron out differences by year's end. We're going to talk about that with our panel next. Back in a minute.
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BARTIROMO: And we're back with our panel. Ed Rollins, Mary Kissel talking taxes. Now, Mary, you think they're going to get this done? What's your take on where we are right now in terms of this tax code?
KISSEL: I do think they're going to get it done because I think the Republican Party realizes the political peril that they are in if they don't get this deal done Maria. I just think. The big question is if they go into conference, are they going to simplify the code? In other words, are they going to take out things like the alternative minimum tax and are they going to make pro-growth decisions? And I look there to the child tax credit which is nothing but a giveaway. It gives nothing for growth, it gives you nothing for prosperity.
BARTIROMO: The cost is $650 million.
KISSEL: Yes, it costs a lot of money. So you know, as we see what they do here, that's the framework that I would use to look at the conference results.
BARTIROMO: That's one place to get money, Ed.
ROLLINS: They had better understand the bill and go sell effectively. Republicans would now stand a snow ball's chance in 2018 if they didn't have this tax bill. So they got to basically buy into whatever it is. It has to be the greatest thing in the world. And it is better than the 73,000 pages we have in tax bill today. So my sense is we have to buy it and sell it and make sure it's effective.
BARTIROMO: This is a $1.5 trillion dollar bill and $900 billion of it is to pay for business cuts. Will the corporate rate going to 20, the pass- through rate perhaps going to 25 or lower. Is that the right track Mary? That corporate -- I mean you do believe that corporate rates coming down will have a broad impact on economic growth, correct?
KISSEL: Yes, yes, it should. I think money will come back to America. I think it will promote an investment boom and it's a long time coming here in America. And we also have to do something to keep this economy going, Maria. We have a couple of quarters of three percent growth, that's great. We might get another quarter of that and the fourth quarter. But to keep that going, you need to give businesses an incentive to invest, take risks to higher. I think the bill will do that. I think the mistake was on the individual side, not giving everyone a tax cut, particularly at the high end because those are the people who generate jobs.
And so, that's a big debate between the House and the Senate is what to do there. The House really wants to punish these people, Maria. I think is anti-growth. And I also think it will punish the party at the polls because a lot of those Republicans who worked so hard to get into that top bracket, they're going to say why are you punishing me for that? Why don't I get a tax break like everybody else?
BARTIROMO: I totally agree.
KISSEL: And they may stay home
BARTIROMO: Yes, and that's the point. Ed, because you've got 10 percent earners, top 10 percent pay 71 percent of the tax but they are getting bullied again by the left talking point of this is a giveaway to the rich when we know it's not.
ROLLINS: It's not. And I agree with you I the sense that this is what people are going to vote on. There will be a better economy. It will be a better economy by 20018 and beyond and I think most -- the high-end people are going to realize the Republicans are better for them and (INAUDIBLE) that will benefit.
BARTIROMO: All right, we will leave it there. Great to see you both.
KISSEL: Thank Maria.
BARTIROMO: Mary Kissel, Ed Rollins, always a pleasure. Thank you so much. That will do it for us right now on "Sunday Morning Futures." I'm Maria Bartiromo, I will see you tomorrow morning on Fox Business Network "Mornings With Maria" 6:00 to 9:00 a.m. Eastern. Join us with special interviews tomorrow, the Chairman and CEO of Vanguard as well as the Winklevoss brothers who are big in Bitcoin.
"MediaBuzz" with Howie Kurtz is next. Stay with Fox News.
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