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Transcript: President Barack Obama

The president’s remarks and Q&A session with AARP members

Jane Pauley: Mr. President, Jane Pauley here again. I’m back in the hall with our members, and they do have some questions for you. I’d like to explain here in the hall that — what a satellite delay is. When I ask a question, it goes up there, and then it comes down. There’s about a second and a half delay between my delivering a question and the president hearing it. Just so you know the drill and a little inside stuff on television.

Mr. President, we are so grateful that you can stay with us a few minutes longer.

Mike, from Brier, Washington, asks: “How will you reduce the federal debt and not gut Social Security and Medicare?”

President Obama: Well, it’s a great question, Mike, and I appreciate it. We have a genuine challenge in bringing our deficit down and reducing our debt, and I think it’s important for folks to know that 90 percent of the debt and deficits that we’re seeing right now are the result of choices that were made over the course of the last decade — two wars that weren’t paid for; tax cuts skewed towards the wealthy that were not paid for. So we made some decisions, and then when the Great Recession hit, that meant more money was going out and not as much money was coming in, and that has blown up our deficit and our debt.

The key to reducing it is to do it in a balanced, responsible way. So I’ve put forward a $4 trillion, deficit-reduction plan which would bring our deficits down to a manageable level and begin the work of bringing our debt down, and it involves making some tough choices. So I’ve already signed a trillion dollars’ worth of cuts, programs that we don't need, programs that, frankly, are not helping people get more opportunity or creating pathways for success for middle-class families or those who are striving to get into the middle class.

But after those cuts are made and some additional cuts are made, the only way to reach that $4 trillion target to also ask the wealthiest among us to do a little bit more. So what I’ve suggested is that we go back for people whose incomes are above $250,000 to go back to the tax rates that existed when Bill Clinton was president, which, by the way, was a time when we created 23 million new jobs, went from a deficit to a surplus, and created a whole lot of millionaires to boot.

Now, this contrasts with the plan that my opponent is putting forward for deficit reduction. And some of you may have seen President Clinton speak at the convention — what's missing from it is arithmetic, because what they're proposing is not only to extend the Bush tax cuts for the wealthy, but then they want to add another $5 trillion tax cut on top of that, and $2 trillion in additional defense spending that our Joint Chiefs of Staff say doesn’t make sense at a time when we're winding down two wars.

So before they even start digging us out of the hole that we're in, they just added to the hole with $7 trillion in additional spending on tax cuts or on defense. Now, they haven't explained how they would pay for that, but independent analysts who have looked at it have said the only way you pay for this is not only to gut investments in education, in basic research that could help find cures for cancer or Alzheimer's, to not invest in our infrastructure, but it also means that you're going to have to impose a higher tax burden on middle-class families — up to $2,000 a year for families with children.

And as I mentioned in my opening remarks, if you're looking at figuring out how to pay for that $5 trillion tax cut, part of what you would also start looking at is taxing Social Security benefits, or turning Medicare into a voucher program. And that is not the right approach to take.

My attitude is that if we're going to work together to bring down our deficit, everybody has got to do their fair share, everybody has got to do their part. And for us to have new tax cuts for millionaires and billionaires to pay for cuts in Social Security or Medicare or education is just not the right way to go.

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