October 31, 2014

Sen. Johanns had hoped for more in the “fiscal cliff” deal (AUDIO)

Sen. Mike Johanns says he had hoped for more, but in the end decided he had to vote for the fiscal cliff compromise.

Johanns says the measure stopped tax increases for nearly all Nebraskans.

“I’ll be the first to say that the agreement wasn’t ideal,” Johanns tells Nebraska reporters during a conference call, “but I have been saying for weeks that going over the fiscal cliff just could not be an option; the damage to our economy (would be) too severe.”

Johanns, a Republican, says he would have preferred extending all the Bush-era tax cuts, including spending cuts and shoring up the Social Security and Medicare trust funds.

In the end, Johanns says he voted for the measure to avoid a tax increase totaling more than $530 billion. Congress approved the deal on New Year’s Day. President Obama has signed it into law.

Johanns says as talks grew closer to the New Year’s Eve deadline, they grew narrower in focus.

“I was one of those senators saying go big, you know, let’s try to do it all,” Johanns says. “But each day that ticked off the calendar it became more and more apparent that we had to focus on what was happening here, which was taxpayers in Nebraska were going to get hammered with a massive tax increase.”

The agreement postponed the deep, automatic budget cuts, known as sequestration, for two months. Johanns says reining in over-spending will be the task of the new Congress and other Congresses to come.

“Anybody that’s trying to convince you that one bill takes a giant step forward is not recognizing how huge this problem is when it comes to spending,” according to Johanns. “We’re going to be fighting this for years and years. It took years to get to a $16-and-a-half trillion deficit. We have way over promised what our economy can produce.”

Johanns says that while the agreement didn’t contain spending cuts, it did make a significant statement on tax policy.

“Just getting this permanent is huge and that’s an important point to make about all of this,” Johanns says. “Our tax debate is now over. We are now in a situation where the things we agreed upon are permanent.”

Johanns says he’s pleased with the fix of the estate tax, contained in the measure. The agreement preserves the $5 million exemption while raising the rate above that exemption from 35-to-40%.

AUDIO: Sen. Mike Johanns discusses the “fiscal cliff” deal with Nebraska reporters. [3:45]