TAPPER: Just a second ago you referred to - when talking about - how the debt ceiling, taking it off the table needs to be part of this deal, you referred to the economy being held hostage by an ideological few. You're aware that when he was a senator, President Obama voted against raising the debt ceiling?
CARNEY: And we addressed that, and there was no threat of default at the time. What happened in 2011, as we all know because we all lived it, most of us in this room, was the threat of default, a willingness expressed on the record and publicly by numerous members of Congress to see the American economy under default and with all the consequent impacts on the global economy and on the American middle class in order to achieve some sort of political victory that was driven by ideology and partisanship.
And that was enormously damaging to the economy, to consumer confidence. We were downgraded, famously. And it is a testament to the American people and the American economy, American business and some of the success we have had working with Congress that we have been able to rebound, and the economy continues to grow and create jobs. But the fact is that was a self-inflicted wound. And we can't have that kind of nonsense anymore. It's not -
TAPPER: It's OK - so it's OK for people to engage in that kind of nonsense if it's - if it's meaningless -
CARNEY: Jake, I appreciate the question, and we engaged in this a lot at the time. And you know, I refer you to my comments about it back then. But the fact -
TAPPER: - voting the way that Senator Obama did and - except you're using derisive terms -
CARNEY: What happened in 2011 is the Republicans in Congress demanded - said they would let America default for the first time in its history if they did not get the items on their agenda. That was consequential, and it was unprecedented. And the result was bad for everyone.
TAPPER: OK. Anyway, moving on, there's - a few weeks ago, the Committee for a Responsible Federal Budget, which is a bipartisan group that includes a lot of Democrats that the president consults with, including Laura Tyson and Alice Rivlin and others - they've put out a paper on raising revenue from high earners. They say that there's a middle ground in which Democrats can raise revenues from higher earners; Republicans can avoid rate increases - the same amount of revenue. You - but you just don't agree with their numbers?
CARNEY: Well, I'm saying that independent economists have assessed that. And it - you can add up the numbers on paper, but when you talk about wiping out the charitable deduction, it's not plausible.
When you talk about cutting into the mortgage deduction in a way that taxes middle-class Americans, that violates a very fundamental principle that the president has, which is this should not - the - in order to preserve low taxes, low tax rates for wealthy Americans, to ask the middle class to pay the price is not going to happen. It's just not - the policy -
TAPPER: But this is -
CARNEY: No, I'm -
TAPPER: This is talking about only taxes on those families making more than $250,000 a year.
CARNEY: No, I would have to look at that proposal. But every proposal that we have seen and every proposal that has been analyzed that imagines that you can achieve the necessary amount of revenue from simply closing deductions or capping deductions or closing loopholes does that in one of two ways: one, raising taxes on the middle class by limiting, you know, very family-friendly deductions like the mortgage deductions or health care deduction and others, or by taking draconian action on the charitable deduction or others that just aren't good policy or aren't politically feasible or realistic. It would be hard to explain, and I don't think members of Congress of either party would want to explain to nonprofit hospitals, major charities or nonmajor charities, universities and others, that all that - all those contributions that they received in the past will not be forthcoming because of an action of Congress. I just don't think that's realistic.
TAPPER: If - just one last question, I'm sorry. If the amount of revenue were the same as raising rates, does it matter how the - as long as the revenue is being raised from wealthier Americans, with the stipulation that you - there's this one deduction that you don't want to take away for charitable -
MR. CARNEY: That's not - that - it is not just one. I'm using one as an example. It is - you know, I'm happy to provide more detail - response to your questions about this particular proposal, but we have not seen and no outside independent economist has seen a credible proposal that says you can achieve the kind of - the kind of revenues that are necessary for a balanced approach just by closing loopholes or capping deductions.
TAPPER: Thank you.
- Jake Tapper