Nightly Business Report Discusses the Fiscal Cliff

On Monday night, Nightly Business Report dedicated a full 25 minute video to discussing the fiscal cliff. The segment involved many different prospectives, from the economics of the cliff to the impact on the real economy and markets.

Fix the Debt Co-Founders and Fiscal Commission Co-Chairs Erskine Bowles and Alan Simpson also appeared in a few segments to discuss the cliff, our debt woes, and the plan that bears their names.

One paticular highlight was when the host asked Bowles "how do we strike the right balance between the economy and jobs and the need for fiscal restraining?"

Bowles said:

And we got a majority of Republicans on our commission, a majority of Democrats and a super majority of a commission to vote for it. And several people asked us, well gosh, if we take these steps now, then we do run the risk of accelerating this downward turn in the economy. That’s why we made our number one principle that we wouldn’t do anything to disrupt a very fragile economic recovery.

So we delayed the early actions that would cause these cuts to take place and we skewed them out in the out years. What people want to see is a plan so we actually do get to balance in the not too distant future.

He also added:

I think we can — if you look at our plans — we have cuts in 2013, 2014. We, you know, we reformed the tax code. I think the best thing we could do for economic growth is to adopt the tax plan that we put forward.

We suggested that—because today, we have the most inefficient, ineffective, globally anticompetitive tax code that man could dream up. And what we said is what we ought to do is broaden the base and simplify the code and we ought to get rid of all this backdoor spending in the tax code and use 92 percent of the money to actually reduce income tax rates and 8 percent of the money to reduce the deficit.

Since there is $1.3 trillion worth of spending in the tax code, these deductions and credits, if you got rid of all of them and went to a zero base, then you could, by using 8 percent of that money, you could reduce the deficit by about $100 billion a year. So over ten years, that’s where our $1 trillion of revenue comes from.

You can view the full 25 minute video clip here.