The following is an unrehearsed interview with Iowa Senator Chuck Grassley speaking to you live from Washington. Participating in today's public affairs program are Dave Vickers with KROS Radio in Clinton and Rae Yost with the Forest City Summit in Forest City.
The first question will be from Dave Vickers.
QUESTION: Thanks for the time, Senator. And I guess we have to start off with the State of the Union address last night -- immediate reactions, thoughts on the ideas and proposals from the president?
GRASSLEY: Yes. Well, first of all, I think everybody knows the president is a good speaker. He makes a good presentation. People like him personally. Don't -- a lot of people don't like his program. I think a majority of the people have a lot of questions about the program.
I would say my reaction is in a very general way, and then I'll be a little specific, but in a general way, last year he had a very aggressive agenda, maybe biting off more than you could chew. People had a look at it. They didn't like it. But one of the reasons it ran into trouble is he didn't have follow-through. So I think you're going to have to wait a few months to see if he's going to learn that lesson and follow through working with Congress more closely to -- to deliver.
On jobs I think it's very, very important that he emphasized jobs, because we talked about health care last year. It wasn't partisan. Nothing got done. People thought we weren't concerned about the economy at all. It's very high on people's agenda. Health care is very low now.
So his tax incentives for small business are very, very helpful. The extent -- and don't forget, 70
percent of the jobs are created in small business -- the extent to which he wants to increase marginal tax rates to almost 40 percent for some people, these tend to hit small business people more than -- than wage people.
And quite -- quite frankly, that's going to be a job killer, because small business operates through cash flow. And it's also unfair to have a -- a tax rate for small business that's entrepreneurial higher than the corporate rate of 35 percent. So I think that that's a negative.
I'll quit with this. There's a great deal of uncertainty out there because of possible tax increases,
taxes on -- on energy that you call cap and trade, a costly health care bill to businesses. All of these things add up to uncertainty for business.
When you have uncertainty for business, you don't get the investment and the job creation you ought to. And consequently, the president -- the extent to which he would make more certain that these things aren't going to happen right away, it would help get the unemployment rate down.
QUESTION: OK. Senator, could you specifically address some of the higher education proposals he laid out in terms of the debt and in terms of how to offset some of that?
GRASSLEY: Well, this program is to have the federal government take over all lending away from the banks and say that we're going to save X number of dollars because the banks were being paid to process these government loans. But already people have a choice between a direct loan and a -- and a loan through a bank, and people are choosing loans through the bank because they don't get processed through government.
So you've probably got thirty, forty thousand people around the country working for banks processing loans. I don't know how the federal government's going to gear up to handle all that that's being handled by -- by the private sector today.
But he's saying, well, we'll save that money, and we'll put that money into a $10,000 tax-free handout to people who go to college. Now, there's nothing wrong with helping people go to college, but if you're going to set up a loan program that's not going to be processed, or it's going to cost just as much through hiring additional help, I wonder if you really have that $10,000 to -- to put out there.
And so I would question whether or not it's wise to go to direct student loans. It's not wrong to have people have the choice, but I think it's -- it's not the right move. And -- and he's implying to continue to go in that direction, and last year it passed the House.
QUESTION: Senator, with the call for freezing the discretionary spending and earmarks reform and issues like that, many entities, the cities -- I know the Clinton delegation will be visiting in a few weeks -- the colleges, things like that come visit your office and others, and other states come visit their congressman, lobbying for various proposals -- is that worthwhile anymore if we are going to look at the freeze in discretionary spending as the president discussed? Or should these groups keep coming?
GRASSLEY: Well, I think they need to come, because as long as there's going to be problems with the federal government, we need to know from the local level, from a group of people coming in, people that have studied it, people that represent all elements of the community. Because we might get these requests individually from people, we'd spent a great deal of staff time to -- to, you know, find out which ones are valuable, which ones have community support.
When groups like Clinton come in, they've studied that. Hopefully, I think they've eliminated the arguments within their community. They put them in -- in order of importance, and we follow that when we make requests.
But also besides just coming for money, a lot of communities have problems with the various agencies. It gives us a chance to put faces together and have, you know, more personal contact between the bureaucrats that may be giving the city a problem or not helping a city solve a problem.
QUESTION: Talk a little bit about the -- the stimulus package that could, or may not, come. I know that some cities in our area have been working on projects or counties. What's the status? What are your thoughts on that?
GRASSLEY: Well, there may still be some money left over from the stimulus that's not out yet. I don't know for sure on that point, but I'm sure there's some of that that's not out, and they may be applying for that. But that money's already appropriated.
I just had conversation with Senator Baucus, the chairman of the Finance Committee. That's a committee I used to chair when we were in the majority. And we are trying to put together a small business tax incentive package that can help to create jobs.
And it may have in it some extension of the highway bill, the federal aviation or airport bill, whatever you want to call it, and things of that nature that we hope will keep programs going, but not expanding those programs. Most of them would be continued at the present level, but -- and probably should be continued until we're out of the recession.
QUESTION: OK.
QUESTION: Senator, it was mentioned very briefly last night. The health care issue seems to have been have been put on hold on the back burner with the election of the senator from Massachusetts. Is that a good thing that's kind of been, I guess, put on hold for further review?
GRASSLEY: Well, remember that what we passed before Christmas wasn't going to take effect for -- till 2014, so there is an -- there is an opportunity to -- to pause and think about what went wrong. And what went wrong was not -- well, there was a lot wrong with the substance of it, but the process was probably more what went wrong, because we were in the process of trying to get a consensus, a broad base consensus that gets a lot of votes, just not the bare 60 votes it takes to get a bill passed.
And the White House pulled the rug out from under us, so pausing, rethinking that and having the White House come forward to the Republican leadership -- to the Republican leadership to sit down at that level, not at my level, at the level of the leadership, and see what can be worked out. I'll be glad to be a -- a technician, fill in the details, because I'm knowledgeable in this area, because this is the committee I serve on.
But we have to have the Democrats that went partisan come now and say they want to be bipartisan. And then they need to consider some of the things we need, like, for instance, helping small business with -- with national pools or let's say association health plans so small business is mixed in with other businesses so they can buy insurance without the prices going sky high when somebody gets cancer working for a small group at one business.
We need medical malpractice reform. We need to make sure that we reduce the tendency towards rationing and maybe selling of insurance across state lines so that there is more competition to drive down the insurance costs. And I could probably list another 10 or 15 things that ought to be on the agenda.
But these are things the Democrats have rejected, and in order to get a consensus bill and -- and also particularly in medical malpractice, it's something at the grassroots of America. People are demanding. Democrats didn't want to talk about it. We've got to talk about these things, if we're going to have a -- a health bill that's going to be bipartisan.
MODERATOR: Thank you, Dave and Rae, for participating in today's public affairs program.
This has been Senator Chuck Grassley reporting to the people of Iowa.
GRASSLEY: Yes, thank you both very much.
QUESTION: Thank you.
QUESTION: Thanks, Senator.
GRASSLEY: Right.
QUESTION: Thanks.
END