Sen. Mike Johanns dismisses President Barack Obama’s call for a grand bargain on tax rates and federal spending.
The president has suggested cutting corporate taxes, while imposing a minimum tax on foreign earnings. Any extra money generated by a tax overhaul would be spent on infrastructure.
Johanns says the president is over-selling the idea.
“His grand bargain probably isn’t much of a grand bargain,” Johanns tells reporters in a conference call. “When I think of grand bargain, I think of entitlement reform and tax reform and that sort of thing.”
Under the plan outlined by the president, the corporate tax rate would be cut from 35% to 28%. Manufacturers would be given a preferred rate of 25%. A minimum tax would be imposed on foreign earnings.
Obama, a Democrat, proposes any money gained from the change be used to build infrastructure, such as building roads and bridges, funding community colleges and promoting manufacturing.
Johanns, a Republican, says he would rather see a more comprehensive proposal, including a tax overhaul, a fix to the funding shortfalls of Social Security and Medicare, combined with spending cuts.
“I just think we’ve got a huge deficit here that we’re not addressing very effectively and we’ve got to come to grips with that and try to figure out how we deal with that,” Johanns says. “My hope is we’ll circle back around and deal with the big picture instead of just one quite small segment of the tax code.”