CHARLESTON, W.Va. - Sen. Jay Rockefeller said he believes the nation can go a long way toward balancing the budget by eliminating some tax breaks and cutting $50 billion out of the defense budget.
"If we're going to balance the budget, we're going to have to do some things we don't want to do," he told the Daily Mail's Editorial Board on Tuesday.
"The question is what are we going to do with some of these trillion-dollar tax (breaks) which have become such an accepted part of Washington? You've got to put money into the economy. Whatever you do should be geared that way. It's about getting bang for the buck."
The West Virginia Democrat said an analysis by Moody's Analytics shows that some tax breaks, like job tax credits and a payroll tax holiday, are highly effective because they put money in middle-class Americans' pockets and they almost immediately spend it.
Other breaks like a cut in the corporate tax rate aren't effective because businesses look at demand for their products or services rather than tax incentives when deciding whether to expand, he said.
Some would call it eliminating "loopholes" while others would call it "raising taxes," Rockefeller said. "I would say it is eliminating tax (breaks) that never should have been done in the first place because they don't have an effect.
"There's a fundamental thing involved in there," Rockefeller said. Keeping existing tax breaks "is such a bedrock belief on the Republican side. We really shouldn't be arguing about this because it's a waste of time. They are not going to change."
It is generally agreed on Capitol Hill that the next big fight will be over raising the federal government's debt ceiling. Rockefeller said time is running out to act "and I'm looking at all of the ways we can raise money. I'm for looking at revenues, looking at discretionary spending, looking at mandatory spending cuts. I think the Department of Defense should be on the table.
"The Congress can ask questions of the Department of Defense about operations and strategy," he said. "We, by law, cannot ask questions about their costs. That's brilliant. It's $750 billion. (Secretary of Defense Robert) Gates knows defense things need to be on the table. (Former U.S. Comptroller General) David Walker said at our Finance Committee meeting last week or the week before, 'You have to do Department of Defense spending cuts.' Walker says you can cut $50 billion out of this easily. I think it has to come out of defense."
Rockefeller said he believes the debt ceiling fight "is the beginning of eight to 10 years of America reconsidering itself." He predicted a bill would pass. "I'm going to vote for raising the national debt ceiling," he said. "To not do so would be completely irresponsible.
"What happened (Monday) was scary," he said, referring to Standard & Poor's change in its outlook on U.S. Treasury securities from "stable" to "negative" because of doubt over whether Congress can compromise on budget issues.
Whether the Standard & Poor's action was or was not a political statement, "it did have a political effect," Rockefeller said. "We're not tending to our Ps and Qs."
Contact writer George Hohmann at busin...@dailymail.com or 304-348-4836.