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July 8, 2011 - Rush Limbaugh Program
37:39
July 8, 2011, Friday, Hour #2
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Space Shuttle just flew over Joplin 30 seconds ago.
Now just west of St. Louis.
Looks like it's going to fly right over Springfield, Illinois.
Welcome back, folks.
Rush Limbaugh on Friday.
Live from the Southern Command in sunny South Florida.
It's open line Friday.
Yep, yep, yep, yep.
Yahoo, once again, uh there's a lot going on here today, folks, but those of you on hold.
Sit tight.
We'll get to you.
Callers get to choose what they talk about.
They get to pretend what it's like to be me, even for a brief number of moments.
Special busy broadcast day, L Rushbaugh at 800 28282.
And the email address L Rushball at EIB net.com.
I asked the question last hour.
Where in the world are the Republicans feeling this pressure to do a deal with Obama?
Where is the pressure to cave to Obama on raising the debt ceiling?
Where's the pressure coming from?
Pat Buchanan has the answer.
As a recent post at the Drudge Report, by refusing to accept, by the way, the title of his piece is an establishment in panic.
By refusing to accept tax increases in a deal to raise a debt ceiling, Republicans are behaving like fanatics, writes David Brooks of the New York Times, conservative colonists, by the way.
David Brooks said of the Republicans, anti-tax Republicans have no sense of moral decency.
They are willing to stain their nation's honor to worship their idol.
That would be Reagan.
If this deal of the century goes down, as he calls the Obama offer, Republican fanaticism will be the cause.
That's David Brooks.
Establishment guy, ruling class guy.
Richard Cohen, Washington Post.
The GOP's become a cult that has replaced reason with feverish and cockamami beliefs.
The Republican presidential field is a virtual political Jonestown, which is the Guyana site where more than 900 followers of the People's Temple drank the Kool-Aid at Reverend Jim Jones mixed for him and died.
Does anybody really think that that's an appropriate description of such mild-mannered guys as Mitt Romney, Tim Pollenty, and John Huntsman?
That they are presidential virtual political Jonestown.
The New Republic, recent editorial headline, the GOP's Hezbollah wing is now fully in control.
Other columnists charge the GOP with holding America hostage and a gun to the American people's head by refusing to accept tax increases to avert a default of a debt.
What to make of this hysteria?
The establishment is in a panic.
The establishment in Washington has been jolted awake to the realization that the Republican House, if it can summon the courage to use it, is holding a weapon that could enable it to bridle forever the federal monster that consumes 25% of gross domestic product.
So there's our answer.
Pressure that Boehner and the Republicans feel is establishment Washington, who want their precious government and their God to grow.
to bully.
By the way, this puts in perspective this stuff I mentioned yesterday.
Matthews, Joan Walsh, Tina Brown calling all these people the Wahhabis of the Republican Party.
It said It's all it's all calculated to put pressure on them.
All because they won't go along with the tax increase.
all because they won't give Obama the all because they're willing to have the government default, which will not happen.
In fact, Social Security checks will continue to go out.
All of this.
We're being lied to by the ruling class, left and right about the debt ceiling and what happens If it's not raised.
To bully and blackmail the Republicans into surrendering the weapon and betraying its principles and signing on a new taxes.
That establishment has unleashed rhetoric more befitting a war on terror than a political dispute.
For exactly how are the Republicans threatening the Republic?
The House has not said it will not raise the debt ceiling.
It will eventually.
It's not said that they will not accept budget cuts.
They've indicated a willingness to accept budget cuts, agreed to in the Biden negotiations.
Where the Republicans have stood firm is on tax increases.
Is fanaticism behind that?
Does this manifest insanity that's coming from the ruling class?
How does this imperil the nation's honor in future, not raising taxes?
Behind the Republican opposition to tax increases is the party's promise, the word given to the country that elected it in 2010.
Its political principles, its traditional view of what not to do when the nation's in a slump.
And, of course, party history.
You don't raise taxes in a recession.
You just don't.
Fully 235 Republican House members signed a 2010 pledge not to raise taxes.
And by giving their word, they were rewarded with victory.
Should they now dishonor that pledge?
What would differentiate them from George H.W. Bush, who famously promised in 88 read my lips, no new taxes, and then went back on his word and took the party down to defeat?
Second, the Republican Party is the party of small government and low taxes.
Why would it agree to raise taxes on the private productive sector when federal spending?
Now at a peacetime record of 25% of GDP is the problem.
Third, America is in a slump.
9.2% of the workforce unemployed, actually more than that as we know.
Another 7% underemployed, the economy growing at a tepid 1.8%.
What?
School of economic thought says raising taxes in a slumping economy is the recipe for a return to prosperity.
There is no such school.
Why?
When the whole country's talking about the need to create jobs, would Congress raise taxes on a private productive sector that employs six out of seven Americans and is the creator of real jobs.
Why?
In 1982, Ronaldus Magnus agreed to the same deal being offered the party today, three dollars in spending cuts for every dollar in tax increases to which he assented, as he ruefully told Pat Buchanan more than once he was lied to.
He got one dollar in spending cuts for every $3 in tax increases.
What of the charge that the Republican House is holding America hostage, blackmailing the nation with a suicidal threat to throw us all into a national default if it doesn't get its way?
This smear is the precise opposite of the truth, as we've been saying over and over.
The Republican Party's not said that it'll refuse to raise the debt ceiling.
The House has simply said it's not going to accept new taxes on a nation whose fiscal crisis comes from overspending.
If the Republicans keep their word, raise the debt ceiling, accept budget cuts agreed to in the Biden negotiations, the only people who can prevent the debt ceiling being raised are Senate Democrats and Obama.
That's why they will cave.
In which case, they and not the Republicans will have thrown the nation into default.
This is the position...
The Republicans own this opportunity.
All they've got to do is stop talking about tax increases and revenue.
It's the establishment, the ruling class that's resorting to extortion, saying in effect to the House Republicans, give us the new taxes we demand, or Obama will veto the debt ceiling and we will all blame you for it.
Buchanan says they're bluffing.
The Republican should stand its ground and fix bayonets.
Lock and load, in other words.
He's right.
The Democrats Are bluffing, the ruling class is bluffing, they are in a panicked hysteria, which itself is the indication of the weakness of their position.
Baehner ought to be feeling no pressure.
From the people that count.
Okay, phone calls are coming next.
When we get back.
Okay, so the phones we go as promised we go to Brooklyn, and Vinny is back.
Hey, Vinny.
Hey, Rush, two of my T ditos.
Uh, thank you.
Uh thanks very much, sir.
Appreciate that a lot.
Okay, I have two points.
My first one is this on Bill Crystal.
Um I've listened to him trying uh convince me that John McCain was such a great candidate for this country.
Crystal is part of the Washington establishment, and so is this entire magazine.
I don't trust him.
And for him to come out and say this, I'm suspicious.
That's number one.
Well, why?
I mean, no, not why.
What do you think is objective if he's if you if you think he's being uh if it uh what's he trying to accomplish?
I I don't know.
I I honestly I don't know, but I do know what Bill Crystal has sounded like all these many years that I've listened to him, and he's been no no real friend of of conservatism as you and I know conservatism, and that's my opinion.
And when I hear him talk big and bad like this, I'm suspicious.
I don't know where it's coming from.
Well um I it's it's it's I've found it, it's out there.
Uh well, no, not the extent of the cave.
You're right.
I maybe he's would you allow the possibility that he is uh playing his own psychological game here.
Of course I would, because what do I know?
I don't know any better what he's really up to, but I'm just going I'm just telling you what I feel and b of of what I do know of Bill Crystal.
The second point, and I need to uh I need to defer to the to the uh to the leader of the uh Limbaugh Institute for Advanced Conservative Studies.
I have heard the the term bandied around tax loopholes.
Now, is a tax loophole the same as a tax stipend?
Is or is that the same as the new, of course, uh revenue uh gatherer that we've heard in the last couple of weeks.
What is a tax loophole?
And is that in fact a actually uh Vinny, an excellent question.
It's an excellent A tax loophole is simply a legal tax law.
That people who disagree with it who think it's unfair, call it a loophole.
Um you might the mortgage interest deduction is a tax loophole.
It is a specific tax cut written to allow people who are paying for a house on a mortgage to deduct the interest.
That's a tax loophole.
Now, the word loophole is made to sound like there are people cheating, but people who are exercising tax loopholes are simply following the law.
Does that help?
Uh that cleared it up for me immensely.
So henceforth, if you get rid of a so-called tax loophole, you're raising taxes on people who benefit from it.
Um you are yeah, uh yes.
If you if you get it rid of a tax loophole, you are essentially raising taxes on on people.
Right, and if you get rid of tax loopholes, but wait, but wait, but wait, wait a second now.
It's imperative that you remember that the the uh the using the language loophole word is is the the attempt is to imply that these people are benefiting unfairly, that they're maybe cheating, that they have discovered a hole, that they have discovered that they have discovered an illegal way around the tax, and they haven't.
They're simply following the law, and people who disagree with that part of the tax code call it a loophole, hoping to uh get the public to support them in changing it, and to cast aspersions on the people who use that tax law as criminals.
Well, I understand one hundred percent, and I will I will say one more thing that The Republicans have come out far too many times in the last month.
And if there's one sound bite, there's a hundred of them, with them implicitly saying there will not be any tax rate increases.
Now, if that's meant to include tax so-called loopholes, revenue, uh uh oil company subsidies, uh.
You know, a tax, a tax rate, when they say that there will not be a tax rate increase, they're talking income tax rate.
Tax loopholes are what would you call it?
You might also call them um uh I'm having a middle block here on the uh uh deductions.
They're they're um uh Schedule C. Uh they they are the so their independent tax rate, well, that the tax rate is what you pay on your net taxable income.
The deductions that you are allowed by law allow you to deduct certain things that you're doing and spending money on or investing it in, like charitable contributions at the tax rate you pay.
For example, if you are in the upper bracket of 35% and you donate a hundred grand to the Red Cross, you get to deduct thirty-five thousand dollars of it.
That's called a loophole.
But that deduction of thirty-five thousand dollars means that your your uh your rate doesn't change, your you it just means your taxable income after getting that thirty-five thousand dollar deduction change.
If they Republicans are promising that the rate of thirty-five percent won't change, whatever loopholes that are loopholes could be changed, deductions could be changed, uh various elements of tax codes could be changed, they can take away the mortgage interest deduction, for example.
So then uh as a way of theoretically raising revenue with not bumping the rates.
Okay, I understand that completely.
So would you consider it then that they would be caving if they indeed allowed some of these so-called tax loopholes?
I understand the language, differential, but if they allowed uh for some of these tax loopholes to change, and um let's just say we uh you know consumers did lose some deductions now, would you consider that a cave?
If they are deductions that Obama wants to eliminate, and if there are no corresponding huge budget cuts, then they're caving.
Remember here, I think that they need to talk, take all this talk about loopholes, revenue, whatever, whatever constitutes revenue, to stop.
Don't raise taxes on anybody.
You are raising taxes on people if you take away the mortgage interest deduction.
You're raising taxes on people if you take away the charitable deduction.
Stop talking about it.
Don't mention don't talk revenue.
Don't talk user fees for Jelly Stone Park.
Don't talk about it.
We are talking about cutting spending.
We've got to.
That's so yeah, you can say that they've caved if they do that.
Yeah, because now I'm a little confused if they do any of that, because you just said that's raising taxes on people effectively.
It does.
It raises the taxes that they will pay.
And depending on who they are, it could have adverse impact on job creation.
If if if they for example, this carried interest business, if if if they eliminate the whole concept of carried interest, the investment in commercial real estate is going to come to a screeching halt.
Now, the hedge fund and private equity boys can just, you know, pack up and move overseas and operate under foreign law and exempt themselves from the carried interest, but obviously commercial real estate guys in America can't just pack up and move.
Well, Rush, I appreciate you taking so much time to explain it to me.
I just wanted to see A, where you were coming from, and B, if I was misunderstanding the language and the meaning of, you know, these so-called tax loopholes, which are really just legal laws.
They're just legal laws.
They're just legal laws.
They're just they're just part of the tax code.
How many of how many of you people consider your mortgage interest deduction a loophole?
I'll bet you don't.
But yet you'll be made to believe that the investment tax credit the oil companies get is a tax loophole because they're big oil, or Somehow they're smart enough to cheat.
You've been told that if they go out and pay these tax lawyers all this money, they can find a way to cheat our precious government and our precious president.
They're not cheating anybody.
The people who cheat are the people that don't file.
The people that cheat are those who don't report all their income.
The people who cheat are those who lie about the amount of their deductions.
So I'm glad you asked these questions, uh, Vinny, because that loophole question is a good one.
Because that's classic.
It's it's it's like it's all it's just like tax break.
You'll look in the coverage of all this today.
I don't care where you go in the drive-by media, you will never see the word tax cuts used.
Nor will you see the word increase.
You'll see there are two words hikes for increases, or breaks for cuts.
Now, what's the implication of the tax break?
It means to the average consumer, American, paying scant attention that somebody's not having to pay their taxes.
You're getting a break on that.
They're not having to pay what you owe.
That's what a tax break is supposed to apply.
It's not tax breaks, tax cut.
The tax hike is a tax increase.
Pure and simple.
They can't liberals cannot live and function and win with real words.
From the Rush Limbaugh Encyclopedia.
A tax loophole is a legitimate deduction that the Democrats and an African demagogue before an election.
Uh tax break, tax loophole, these are all class warfare terms, my friends.
They are uh they're used to suggest that a class of persons, usually the rich, have gotten favorable treatment.
But in reality, who gets more tax breaks and loopholes than the so-called poor?
When forty-seven percent of U.S. households pay no income tax at all and get money back.
That's one hell of a tax loophole.
The biggest tax loophole in the world is enjoyed by 47% of the American people.
They don't pay a dime in federal income tax point.
Do we ever hear the earned income tax credit as a tax loophole?
How about the uh the child deduction?
It's a tax loophole.
That's a it's a tax break.
Maureen in St. Louis.
Thank you for waiting.
You're next on Open Line Friday.
Hi.
Thanks, Raj.
I just you hit the nail on the head right at the opening.
Uh if they cave on this uh deal for extending the debt, I'm done.
I am so done with the Republicans.
I'm my very first vote was Ronald Reagan, 1980.
I have supported them.
But if they cave this time, I'm gonna have to go in a different direction.
No, you won't be alone.
There'll be a third party.
If if they if they cave, that's um and that's that means the re-election of Obama in 2012.
That's what I mean, that's if they cave, that's what it means.
Well, why do you say that?
You don't think there's enough people?
I know you always say that uh third party means that Democrats would win.
But the Tea Party has laid some serious groundwork in the last three years.
I'm relying on history, third parties.
The third party's gonna have one candidate, presidential candidates.
Not gonna have congressional candidates, not gonna have it's not gonna have enough time to gin up all that.
It's not gonna have uh we're talking about 2012 here.
Less than two years away.
That's uh it's it would be tough.
The odds of uh of a Tea Party presidential candid candidate winning.
It's gonna split the vote.
I don't care.
No matter what you do, you're not going to get all of the Republican votes in the Tea Party.
And we're gonna need every Republican vote to beat Obama.
That's simple.
Well, I I as far as funding and supporting Republicans, I'm not gonna do it.
I understand that.
You're not alone.
Believe me.
I uh this worries the hell out of me.
I I after this, after the November elections, after no matter where you go, fifty seventy-two percent of the American people want a private sector economy.
Sixty-five percent think the country is headed in the wrong direction.
If the election were held today, Obama loses in a landslide.
There is no reason for Obama to get what he wants here.
What he wants guarantees more of this mess.
There's no solution.
Obama is not a solution.
Obama is the problem.
The Democrats have already bought Maureen close to 43% of the population.
That's the percentage of people who get some kind of government money to live.
They've bought 43% of the population.
Tea Party cannot compete with that.
Not in 2012.
Go back to the audio sound bites.
Yesterday on CNBC, Herbie Allen's got his big media confab going on out at Sun Valley in Idaho.
And that's where you know the media heads.
I could never figure out why it really happens.
I've never been invited, and I'm big media.
Without me there, I don't know how anything that matters can get done.
Well, Warren Buffett goes out there, Bill Gates goes out there, the guys in Microsoft, Apple, they go out there from the record companies, uh, the presidents they go out there.
Uh Brocaw goes out there.
Uh uh.
Dan Rather used to go out there, Bob Iger from uh Disney ABC goes out there.
Uh Rupert Murdoch goes out of Catherine Graham.
Remember, she fell one day out there and got injured pretty bad.
Uh I've I've never been, but that's they're they're out there.
Big media confidence.
Herbie Album throws his big bash.
Um I've been to Sun Valley.
I I uh beautiful, beautiful place.
I got a friend who lives there not far from where John, well, I'm sorry, Teresa Heinz Carey owns a house.
And uh Carrie lives there when he's in town.
The hotel accommodations are not five-star in Sun Valley's.
I don't I uh uh I don't know where they all stay.
Uh no big deal.
I'm not I was I'm just thinking aloud.
Anyway, Buffett's out there, he was interviewed on CNBC yesterday.
Essentially, he said that we're playing Russian roulette with ourselves if we don't raise the debt limit.
Rick Santelli.
Remember him, the original Tea Party guy on CNBC, he lost it.
He went nuts after Buffett appeared.
He was on Street Signs on CNBC yesterday.
They're having a discussion about Buffett's remarks about government playing Russian roulette with these uh debt negotiations, and Rick Santelli and an author of a book, Gamillions Not Enough, Michael Farr, had this little exchange.
I so disagree with Warren Buffett.
So disagree.
Who's holding who hostage?
You know, any addict, you you can't bend the rules.
There's the steps you follow when you're an addict.
It isn't anything you can bend.
In November, there was an election.
People in the House were sent there because the voters had an appetite for less spending.
They want a DC to control their spending.
And if whatever comes out of these meetings doesn't satisfy the electorate, guess what?
November comes in a calendar once a year, and maybe the next election will make the midterms look like child's play.
Okay, this is where this far guy gets involved.
If not now, when now's the time.
Now, now, now's the time, But they can't use this gun.
Oh, let me tell you something.
Nothing will pass the house if they stick together.
End the story.
That's the way the game works.
So where does compromise come from, Rick?
I don't believe in compromise on spending.
There's no compromise.
Stop spending.
Live within your means.
He's exactly right.
No compromise on spending, and that's what this is talking about.
That's what all the why what is the why compromise here on the future of the country?
There's no it's just, it's it's absurd.
And this is not why these guys were elected.
They kept talking.
This is not over.
Taxpayers for more money or an increased debt ceiling until you give us a darn budget.
Until you give us a budget, but we're running out of time.
I mean, somewhere in here they've got to figure out.
What have they been doing for two years?
But it's a practical problem, right?
I mean, we still have to come up with the practical.
We can pay our interest payments, the rating agencies, unlike Europe, aren't going to come after us with plenty of people that aren't going to get programmed money.
I understand that.
But maybe the programs need less money, need to be streamlined.
It isn't a question about whether you need to tackle Social Security.
It's how long do you think that bullet's going to take before it comes out of the revolver.
I'm here.
Well, that's Rick Santelli with a limbaugh echo on CNBC yesterday.
Talking about no need to compromise on spending, and that we're not going to default.
We're not going to be unable to make debt payments if we don't raise the debt ceiling.
Keeping on doing the same damn thing is not compromise.
Obama and the Democrats want to keep on doing the same damn thing, and that isn't compromise.
It's doing the same damn thing.
The Democrats are saying, let's compromise.
Let's keep doing things our way.
The answer to Democrats is we're not going to keep doing things your way, and we're not going to compromise on spending.
And we are not going to raise taxes.
And we don't care what Richard Cohen says.
And we don't care what David Brooks says.
And we don't care what the establishment says about this.
It's going to come down to who the congressional Republicans are going to listen to.
It's going to come down to whoever they think.
They have the most to fear from.
Some people think that the unemployment rate today going up to 9.2%.
Pretty much means that there's no way a responsible Republican leader would cave.
Not with the unemployment news continuing to be bad, therefore Obama's policies obviously being destructive.
There is no way.
Rush.
Don't worry about it, Rush.
There's no way a responsible leader's going to cave.
At 9.2% unemployment figures a game changer.
What do you mean?
It just went up one-tenth of a point.
Why wasn't 9.1% a game changer?
What?
On Thursday, they're talking about possibly caving, so go from 9.1 to 9.2%.
Well, that takes a cave off the table.
A lot of wishful thinking going on out there.
The unemployment rate, this is Wall Street Journal, unemployment rate.
Increased to 9.2% in June, the labor department reported.
But if the recession had not pushed so many people out of the labor market, it would have been much worse.
The duration of unemployment continues to increase and sat at an average of 39 basically 40 weeks.
That's the average duration being out of work.
More than four million people who want jobs are nearly a third of the unemployed have been out of work for more than a year.
Those are the people who are hanging in and looking for work, but a large number have given up given up looking for work altogether.
The share of the population in the jobs market, which is called the labor force participation rate.
The share of the population in the jobs market, the labor force participation rate fell to 64.1% last month.
That's the lowest level since 1984 when women were still just beginning to enter in full force.
So, bottom line here is the calculation has been done here without the people who've dropped out.
If you still counted the people who no longer look for work, the uh the U3 unemployment number, which is the one that's reported every uh every week would be over 11%.
And the U6 number would be up over 17%.
The AP today reporting the 9.2% rate.
Headlines it this way.
Unemployment rose to 9.2% is hiring stalls.
Hiring slowed to a near standstill last month.
Employers added the fewest jobs in nine months.
The unemployment rate rose to 9.2%.
And notice how they put that.
Hiring slowed.
Unemployment has gone up.
It would seem that hiring has done more than slowed, but at least you have to give AP credit for trying to put the best face they can on this latest bad news, and it's bad news, and they're everybody.
Reuters AP politico, they are all trying to spin this with the biggest smiley face they can find.
The labor department says the economy generated only 18,000 net jobs in June.
Pelosi, we've got a tape, got it on tape, said that 400,000 jobs would be created immediately after Obamacare was passed.
Biden said we'd be creating what 500,000 jobs a month because of the stimulus.
Yeah, 500,000 jobs each month.
And yet only 18,000 jobs were added in this, our second summary summer of recovery.
Now also, and they finally report this, folks, in the story.
Last month's job number was revised down by almost half.
So May's unemployment was probably 9.2% as well.
Only 18,000 jobs were added in June, and that's going to be revised down next month.
All these numbers change.
They just never tell us the next month how they were wrong.
Now notice how yesterday the AP and the rest of the media latched on to the ADP claim, the payroll agency, that 157,000 jobs have been added in the private sector.
They did the same thing last month, too.
But once again, the news media and the rest of the Democrat Party find out it's easier to talk us into a recession than to talk us out of one.
They're doing their best to talk us out of this.
But they just can't.
They admit in this story that the revised numbers that the you know the supposed jobs created last month, no, it was 3,000 less than we thought.
They've been revised down there all.
Since 18, my point is this 18,000 jobs they say created in uh in June.
It's going to be 12 to 13 by the time this is revised in a couple of weeks.
You just won't see it reported.
Bureau of Labor Statistics, this is what I was referring to in the first hour, the new normal.
They had to change the reporting of unemployment to keep the rate at 9.2%.
Effective with data for January of 2011 this year.
The current population survey was modified to allow respondents to report longer durations of unemployment.
Prior to January of this year, the current population survey accepted unemployment durations of up to two years.
Any response of unemployment duration greater than this was entered as two years.
Starting with data for January, respondents were able to report unemployment durations of up to five years.
This change single-handedly affects estimates of average duration of unemployment.
The change did not affect the estimate of the number of unemployed people, did not affect the other data series on the duration of unemployment.
There was an unprecedented rise in the number of people with very long durations of unemployment during the recent labor market downturn.
So now they've had to revise it up to five years.
That's because as I mentioned Earlier.
It used to be back in as recently as 2007.
If you're out of work five months and you got a job.
Now people are out of work two years revised up to five.
This is what it means.
Rocking on, we're going on faster than anybody can believe.
Fastest three hours in media, two of them already down and on the way over to the Limbaugh Broadcast Museum, which you can see at rushlimbaugh.com, our virtual broadcast museum.
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We got you covered.
We're here for another exciting big broadcast hour.
It's open line Friday.
If you're on hold, please stay there.
You're on hold for a reason.
David Pluff, Top Obama Advisor 2008.
Did you hear this?
Unemployment is not going to be an issue for 2012.
People aren't going to vote 2012 based on the unemployment rate.
The average American, this is what he said, the average American doesn't view the economy through the prism of GDP or unemployment rates or even monthly job numbers.
People won't vote based on the unemployment rate.
Do I think my president makes decisions based on me and my family?
That's what he says.
So basically he's saying you people are a bunch of selfish twits.
As long as your personal situation is over, you don't care if the country's going to hell.
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