david stockman is, you know, a really famous guy. and a thoughtful guy. i disagree with him vehemently. and i have for about 30 years. david believes that every tax increase equals a revenue increase. but that's not true. anybody that's familiar with the historical data from the irs, knows that raising income tax rates will reduce federal revenue. the top 1% are going to send less money to washington, d.c. and that will never get us out of this. >> i just have to respectfully disagree. you will have some loss of revenue because some activity or transactions won't happen. but if you raise taxes on paper by $100 billion, maybe you'll get 90 or 85. but it's common sense fact, that when you raise the rates, you get more revenue. normally, it's a bad thing to do. but we're in such dire shape, that we have no choice but to accept the negative trade-off of some harm to the economy, to start paying our bills. otherwise, we're dependent on the chinese. we're dependent on opec. we're dependent on hedge fund guys to buy back our debt. and this game is about over. >>

he's very willing. >> stahl: but, as david stockman will tell you, that attitude is hard to find. >> 've demonized taxes, all right. we've created almost the idea that they're a metaphysical evil. >> stahl: still, he says there should be a one-time 15% surtax on the wealthy that he estimates would cut the national debt in half. >> stockman: in 1985, the top 5% of the households, wealthiest 5%, had net worth of $8 trillion, which is a lot. today, after serial bubble after serial bubble, the top 5% have net worth of $40 trillion. >> stahl: oh, my god. >> stockman: the top 5% have gained more wealth than the whole human race had created prior to 1980. >> stahl: of course, it would never pass. there's the rub. >> stockman: there's the rub. >> stahl: the antipathy to raising taxes or making any real spending cuts, whether in washington, d.c., or washington state, is so intense, stockman despairs that, when congress returns after the election, they'll do what they often do-- nothing. i remember that great expression, "let's kick the can down the road." >> stockman: yes. >> stahl: that becam

you have david stockman. look, we don't have the revenue covering these things. 70% of our budget goes toward the title -- entitlements and the military. unless someone is going to come up with an idea to point to some of the revenue that will offset this money, they will have to address it. if it is not going to happen and we will extend a portion of your two, everybody on the record, in front of the american be bought and say on tv on record. don't be hiding behind everything else. just say it in front of the american people. host: we got up of the. let's go to joe. caller: greta, you do a great job on c-span. love c-span. we've got to have the tax cuts. we must have the tax cuts. i have been invested in the stock market for 40 years and you see it rise lately and i think it is because the anticipation of the tax cuts. but like the other republican caller said, we've got to cut spending. and we've got a congressman tom graves who will lead the fight not only for the tax cuts, greta, but the spending cuts. s

i had the pleasure of talking to david stockman and i agree with him that i don't want to paraphrase his words but tax cuts is just another keynesian economic move to forgo. i can understand why they would do another tax cut to put it on the credit card but as far as spending money. we spent $14 billion to protect our troops from i.e.d.'s and german shepards won in the end. i want to put a plug in for ted kennedy jr. versus joe lieberman. i think that would be a good race for our state. and i'm very -- i'm -- i'm very concerned that the g.o.p.'s take my votes seriously. i know they got deconstructed by the tea party movement, but it's all about the economy with my vote. i'm extremely worried about the -- even paul crodman's projections for 2025 are very concerning to me. i want to talk about the g.o.p. alignment and where they should go from here. guest: well, in the first place, if you agree with david stockman you're probably not going to agree with what they want to do and that is maintain the bush tax cuts and not let them expire at the end of this year and that means all the tax

secretary, even if you got all the things you're describing, david stockman, who was the budget director for ronald reagan, says you need to do all the things you described, but he says still, if you look at the budget deficits and you look at the projected budget defic deficits, particularly once the baby boomers really start retiring, you're going to have to raise revenue. there is simply no way -- the math doesn't work without raising revenue. and your proposal number one effectively locks in the bush tax cults, which means that you lose about $700 billion to $800 billion of revenue over the next ten years. how would you make the math add up? >> well, i don't agree with your math. that is, i think the way to produce revenue right now is to create some certainty about tax rates and leave the incentives there and have the economy expand. an expanding economy will -- is the best way there is to generate revenue. so that's the way to start. then i think you need to look at the tax system. and everybody agrees that it badly needs reform. the corporate tax rate is punitive, much too high. t

i had the pleasure of talking to david stockman and i agree with him that i don't want to paraphrase his words but tax cuts is just another keynesian economic move to forgo. i can understand why they would do another tax cut tput it on the credit card but as far as spending money. we spent $14 billion to protect our troops from i.e.d.'s and german shepards won in the end. i want to put a plug in for ted kennedy jr. versus joe lieberman. i think that would be a good race for our state. an i'm very -- i'm -- i'm very concerned that the g.o.p.'s take my votes seriously. i know they got deconstructed by the tea party movement, but it's all about the economy with my vote. i'm extremely worried about the -- even paul crodman's projections for 2025 are very concerning to me. i want to talk about the g.o.p. alignment and where they should go from here. guest: well, in the first place, if you agree with david stockman you're probably not going to agree with what they want to do and that is maintain the bush tax cuts and not let them expire at the end of this year and that means all the tax cu

i had the pleasure of talking to david stockman and i agree with him that i don't want to paraphrasehis words but tax cuts is just another keynesian economic move to forgo. i can understand why they would do another tax cut to put it on the credit card but as far as spending money. we spent $14 billion to protect our troops from i.e.d.'s and german shepards won in the end. i want to put a plug in for ted kennedy jr. versus joe lieberman. i think that would be a good race for our state. and i'm very -- i'm -- i'm very concerned that the g.o.p.'s take my votes seriously. i know they got deconstructed by the tea party movement, but it's all about the economy with my vote. i'm extremely worried about the -- even paul crodman's projections for 2025 are very concerning to me. i want to talk about the g.o.p. alignment and where they should go from here. guest: well, in the first place, if you agree with david stockman you're probably not going to agree with what they want to do and that is maintain the bush tax cuts and not let them expire at the end of this year and that means all the tax

so last night former reagan budget director david stockman offered his opinion. >> what would you dol security? >> well, unfortunately, it needs to be means tested. in other words, it is a $700 billion-year program. the heart of the budget. we will have to say to the better off elderly people already retired and this is -- will be seen as unfair but it's unavoidable. you will have to have your benefits means tested. >> explain what that means. >> we'll look at your private assets, we'll look at the private income and if they're above a certain level, let's say, $50,000 a year of private income, we will have a ratcheting back of your social security check in order as a contribution to solving this problem. >> social security will go more and will be focused upon those who need the money, not exclusively based on what you paid in? >> that's right. >> has been the equation until now. >> watch "parker spitzer" tonight 8:00 p.m. eastern on cnn. >>> all right. we are flashing back to november 11th, 1918 at 11:00 a.m. that day, world war i officially ended. europeans marked the anniversary