More On Tax Planningfrom The Advisor's Professional Library
- IRAs: Eligibility The eligibility rules for contributing to traditional and Roth IRAs are complicated. Learn how to effectively use them in retirement plans.
- Long Term Care Insurance: Premiums While premiums for qualified long-term-care insurance may be deductible as medical expenses there are exceptions to this general rule. Learn how to avoid unnecessary tax liabilities.
Gov. Chris Christie, R-N.J., and former Gov. Tim Pawlenty, R-Minn., on Fox News Sunday, spoke in favor of a hard line on spending, to the extent that government shutdown should be part of the discussion.
Chris Wallace spoke with Christie about his confrontation with New Jersey Democrats over a possible shutdown of the state government over the budget: ““Last year, when New Jersey Democrats threatened to shut down the government because you had a disagreement with them about a tax they wanted to re-impose on the wealthy, you said fine. I'll veto the budget. I'll go back to the governor's mansion and I'll order a pizza.”
It was one thing, Wallace said, to consider shutdown of a state government. But it was another matter for the U.S. government to “default on its credit and go into debt.” Should Republicans in Washington, he asked, “take the same hard line in opposing the president about raising the debt limit and on federal spending?”
Christie responded, “Well, what I would suggest is that Republicans in Washington should do what we did in New Jersey.” Republicans, he added, should “go out to the public and make their case.” Then, he said, they should “have the guts to put up or shut up.”
Christie said he didn’t actually have to shut down the New Jersey government, and said it was because he was “clear” in his argument: “… this is about making the argument and trying to win the argument. And I think if you close down government, in some respects you may have lost the argument.”
Wallace pressed him on whether Republicans should be prepared to allow the country to go into default, and he replied, “The Republicans should be prepared to articulate their argument and win the argument, Chris. That's what they should do.” He then pointed out that there had been times when he compromised “on things that I wanted.”
Pawlenty was not so reticent. In 2005, Wallace pointed out, Pawlenty allowed Minnesota’s state government to shut down for nine days because he disagreed with the Democratic legislature on taxes and spending. Would he advocate the same treatment for the federal government?
Pawlenty replied that he was “glad we had that showdown in Minnesota.” The federal government, he said, “should not raise the debt ceiling.” Instead, he advocated Republicans sending “the president a piece of legislation that authorizes the federal government to sequence the pain of its bills so that we don't default on the debt obligation and then have the debate about how we reduce the other spending.”