it is a huge loophole. thank you for coming inside "the war room." >> thank you governor. >> jennifer: where the campaign never ends. that's investigative reporter with the nation, lee fong. really appreciate it. coming up, republicans like to spin a yarn that big business is no fan of president obama though to swallow that, you would have to believe that they don't like money either because they're raking it in like never before. that story is next. one you'll only find inside "the war room." i think that the audience gets that this guy, to the best of his ability, is trying to look out for us. [ boy 1 ] hey! that's the last crescent. oh, did you want it? yea we'll split it. [ female announcer ] made fresh, so light buttery and flakey. that's half that's not half! guys, i have more! thanks mom [ female announcer ] pillsbury crescents. let the making begin ♪ ♪ [ female announcer ] holiday cookies are a big job. everything has to be just right. perfection is in the details. ♪ ♪ get to holiday fun fas

it is a huge loophole. thank you for coming inside "the war room." >> thank you governor. >> jennifer: where the campaign never ends. that's investigative reporter with the nation, lee fong. really appreciate it. coming up, republicans like to spin a yarn that big business is no fan of president obama though to swallow that, you would have to believe that they don't like money either because they're raking it in like never before. that story is i think the number one thing that viewers like about the young turks is that we're honest. they can question whether i'm right, but i think that the audience gets that this guy, to the best of his ability, is trying to look out for us. >> jennifer: president obama took his fiscal cliff avoidance campaign to corporate executives today. those top leaders may be small in number but they're actually very extra large in influence and during his address the president's address to the business roundtable which is a bunch of ceos of the biggest corporations president obama h

let's say they put closing loopholes and deductions on the table. the issue is whether anybody is going to go for this. the deductions that are there are very popular. the ones that would get the most revenue on the table are employer sponsored health insurance which is $164 billion, the mortgage interest deduction which is $100 billion, tax free medicare benefits $76 billion and charitable contributions no one on either side of the aisle wants to get rid of, $51. why are we talking about the closing of loopholes and ending deductions? >> i don't think we should go too far here. it is worth talking about. it gets strange quickly. here's the way i've been thinking about it. almost all of these plans are just about deductions, not about exclusions. i've not heard anybody talking seriously about the employer health tax exclusion, that's a separate tax and not a deduction. when talking about all these plans the republicans have begun to broach about limiting deductions to save $25,000 or $50,000, you're talking really about three deductions and three on

we are talking about tax loopholes and deductions.

what are loopholes and deductions? we hear those words a lot. >> loopholes are really in the eye of the beholder, tax breaks of all different sorts. and whether you like a particular loophole depends on where you said. deductions are the ones most people are most familiar with. the big itemized deductions are the home mortgage interest deduction. the deduction for charitable contributions is important. there are all kinds of other breaks. there are some that are big that people may not be aware of. the health care that we get a work represents a big source of income to a lot of people. it doesn't count as income on your taxes. that is a giant break in itself and known as an exemption. there are other breaks that exist. the earned income tax credit goes to the working poor. then folks with children get a child credit that is a lucrative credit, worth $1,000 per child right now. congress loves tax breaks. host: is there a difference between a deduction and tax credits? guest: a deduction is something you take off your in

loopholes, aren't we tired of hearing about loopholes? timothy geithner made appearances on all the sunday talk shows to hammer home the specifics of the white house plan. republicans tried to counter his presence using their favorite media source. >> timothy geithner scheduled a round of interviews, but friday afternoon speaker boehner's office said he wanted to come on fox news to tell his side of the story. >> gosh, i wish i could get those calls. they gave john boehner the floor but he showed up with nothing. >> we have laid it out for him. a dozen different ways to raise the revenue from the richest americans as the president would describe them. >> what's the biggest proposal you put on the table since the election in terms of raising revenue from closing loopholes and deductions? >> there's a lot of ways to get there, but you could cap deductions at a percent of income. that would be one way to get there. you could eliminate deductions for the wealthiest. >> let me ask you a couple specifics. would you limit the home mortgage deduc

and often contain many loopholes. this is the difficult political terrain to which the president now treads. but he said that's where he's headed. >> if we are not getting right, the need to keep our children safe, then nothing else matters. >> reporter: this is jake tapper for "nightline" at the white house. >> thanks to jake for that. >>> as we say good night this evening, nine "nightline" teams are imbedding in various locations across the country for a special edition -- a day in the life of the american gun. make sure you tune in tomorrow. thanks for watching abc news. we hope you tune in for "good morning america." we're always online at abcnews.com. jimmy kimmel is up next. we'll see you here tomorrow. >>> up next on "jimmy kimmel live" -- >> the company said if they didn't come to work by thursday, they would liquidate, which actually sounds delicious. >> eric stonestreet. >> stone street sounds drunk onstage. i was like, i was not drunk, i was tipsy. >> do you work on thanksgiving? >> absolutely not. i'm an a

that is just how things go. >> this whole issue came up because of a loophole, because someone found a leap hole. >> right. so i think to some extent the ethics commission has the ability to address leap hole lope holes. the only downside if we don't define "support" at all there will be the chance of zero gay and lesbian as of what "support means." >> if we had "support" i would define it as public action or statement or actions encouraging or urging -- i will concede that i'm hoping that my hypothetic is ridiculous and it would be interpreted in the way that we have all think it should be. >> you just built them their loophole. >> i was thinking that election makes it more restrictive. >> that was my reaction when you said that. >> the big problem we had last time, the committees kept saying we are not a campaign. we don't have a candidate. we can't be a campaign without a candidate. and the commission accepted that. but at the same time, they were raising money and spending money that had the effect of a campaign while not being regulated. >> could we solve it by having both in th

what are loopholes and deductions? guest: loopholes or tax breaks of all different sorts. whether you like a loophole depends where you sit. deductions are the ones most people are most familiar with. the big itemized deductions are the home mortgage interest deduction. the deduction for charitable contributions is important. there are all kinds of other breaks. there are some that are big that people may not be aware of. the health care that we get a work represents a big source of income to a lot of people. it doesn't count as income on your taxes. that is a giant break in itself and known as an exemption. there are other breaks that exist. the earned income tax credit goes to the working poor. then folks with children get a child credit that is a lucrative credit, worth $1,000 per child right now. congress loves tax breaks. host: is there a difference between a deduction and tax credits? guest: a deduction is something you take off your income. a credit is something that is taken away from the tax that you owe. if you owe $20,000 in tax and get $1,000 tax credit, you're

i'm curious to know exactly what loopholes, what deductions would you kill? i think for a lot of people who worry about the child care credit or the mortgage deduction would like to know specifically what's on the line. and at what rate. >> i put out a report called subsidies for the rich and famous, about a year ago, that listed $30 billion a year that we could take from the wealthy, on things they get a significant advantage from. so it's not that we can't do it. what i -- all this jockeying in public, we need real leadership right now. there shouldn't be anything offered in public. what it should be is the president and speaker boehner in a room, and nobody come out of the room until this is solved. the long term -- we're paying gotcha politics and that has nothing to do with the long term best interest of this country. and what we ought to be is, i'm okay to compromise even on some of my issues, if in fact we'll solve the problem, what we have is a game being played for political -- for the extreme right wing and the extreme left wing in this country, rat

they plan to raise $800 billion by closing loopholes and deductions. only one problem a problem that flummoxes no less than mitt romney and paul ryan throughout the campaign, a problem as real today as it will be tomorrow -- the math. as the president explained in his first post-election interview on bloomberg this afternoon. >> it's a simple proposition that you can't raise enough revenue, and if you don't raise enough revenue through closing loopholes and deductions, then it's going to be middle class families who make up the difference. >> indeed. as the president notes, you can't get $800 billion in revenue without eliminating, for example, charitable deductions, which would put all manner of hospitals, shelters, and churches on the road to ruin. as the president said, that's not his idea of a balanced approach. >> middle class seniors who are on medicare, young people who are trying to get student loans to go to college, i can't ask them to sacrifice and not ask anything of higher income folks. >> no, that's republicans job, of course, a very spec

they should be uniform i don't understand and it's a little bit a misnomer that there's just total loophole but i know what you're talking about but yeah i mean if there are restrictions on guns whether it's felons or whatever i can see a uniform application of the law but we're taking a big step out of this where you're talking about selling guns people making money about that's what you're forgetting is that there's not just individual liberty here there's an individual responsibility somebody is picking up that gun and going and doing something with it so everything that i'm hearing is about all the you don't want to get is a range people access to picking up those guns for me instead in the interim doesn't address that they want to have security guards in schools as liberal as. terry and does the idea of big government armed security guards make you a little uncomfortable that you know every school in america absolutely i don't agree i think the whole press conference was a train wreck i think was ill advised i don't think it came off right it's very emotional right now and i totally em

the assault weapons, extended magazines, the gun show loophole, i agree with all of that. i just think when we speak in broad terms, when we use statistics about gun violence, it sounds to a lot of people like we want to ban guns completely, and we have to be smart and strategic if we're going to win political battles. so that's why i'm urging caution in terms of the way that we talk about this and being specific about what it is, what solutions we're proposing because i think there's very few people out there who would say, complete ban on guns or even complete ban on handguns. so that's my only word of caution in this particular -- >> we either go toward more guns in society or less, right? certainly more guns is not what you want, right? >> but, toure, isn't there also a gaping need for psychiatric services, particularly for men, and for this to be opened up as a discussion point given that in so many cases and fbi experts tell us that there are signs and signifiers that an individual doesn't perpetrate a crime like this out of nowhere, and that often times there might

the first year twenty eight billion dollars and together we can solve the homeless problem and that loophole is section one fifty two the odious provision that allows illegal aliens and others to to talk. take a pendent adduction for people who supposedly live in mexico now that system is rife with fraud and we have no way of verifying it and yet they go ahead and just allow it year after year after year tom there's been a lot of talk you know that the president is secretly a mostly a socialist or whatever i'm starting to think he's secretly in the tea party for not just taking out his pen and saying we've got to close this loophole today and he could help the party likes illegal immigrant this taking tax deductions for us are ok nobody seems to be almost heartless to punish these american citizens many of them david corporate after harper ok i can't speak to your suggested deduction i have another math i'm not that familiar with it but i do know that eliminating corporate meal and entertainment write offs the ability you know you and i are both business just those are what i read in a neces

host: finding loopholes and other things. guest: the discussion of loopholes again, is an attempt to avoid the difficult questions, that would be involved in a tax plan that eliminates the tax expenditures. most of the loopholes were eliminated in 1986 tax laws that eliminated tax shelters for individuals. there are not many special- interest loopholes available to individuals. if you are talking about loopholes for special-interest provisions in the individual income tax, you're looking at home mortgage interest deductions, charitable deductions, deductions for state and local income property taxes and the taxation of employer provided health care. those are the items that will be involved in any individual tax reform that either puts a cap on those benefits or repeals or eliminates those benefits to finance lower rates. as much as i would like to be able to say that there are many special-interest loopholes out there that we could just eliminate and finance a more robust reform, that is simply not the case. i would argue th

he has offered to raise revenues through loopholes. but the president has taken this very arrogant, hard-line, and you have the leadership in the congress saying that we will not do anything on medicare, with a cost-of-living adjustment, we will not do anything on any entitlement. without that, boehner would have to say no and then we go over the cliff. >> more people in that poll gave negative descriptions of the democrats than positive. if that this fails, democrats don't get a free ride, either. >> i think this has been an unbelievable failure of leadership by the president. you have got to raise taxes and cut entitlements, but the president has completely taken a pass on his role of getting the public ready for how serious this is. >> i have been reading the caro book about johnson. >> great, isn't it? >> it is in some ways the most interesting of the books. he understood that you have to make your opponents look good. otherwise, they don't want to go along with you. he has to get some allies on the republican side so that everybod

that's why the president is pushing back on the loopholes. that's not going to get us where we need to go. great now you can say the word revenue, but you know, let's get specific about what that means. the president knows he is operating with a very strong hand here. >> josh, you know, what's interesting is, we've seen republicans come to the table in the way they didn't last year and i thought it was interesting this morning on "morning joe," tom coburn saying basically i know we have to raise revenue and tax rates may be part of that. let's play the sound. >> personally, i know we have to raise revenue. i don't really care which way we do it. actually i would rather see the rates go up than do it the other way because it gives us a greater chance to reform the tax code and broaden the base in the future. to me i think they're arguing over se mant it ticks. $800 billion is $800 billion. >> tom coburn he prefers for the rates to go up and a giant bolt of lightning did not strike him down when he said that. >> he's known for these. one of the

the loophole is called the gun show loophole. there was this concept that add a gun show if you wanted to sell one gun and i just wanted to buy one gun, we wouldn't go through a background check because it was too complex. number one, it isn't complex. both of us could use a gun deal. 9% of the gun deal efrs dot collection and follow the law to the letter. it is not onerous and it does work. but the gun shows evolved from just you selling one gun to me, to you having 500 guns and 10 or 20 like me come in to buy guns like you. it is away to avoid the background check. number two, the background data base is not kept up-to-date. the president by executive order could do something like that. there was a disaster, murder, six, eight months, a year ago, a military guy. the military knew he had psychiatric problems and never but p thought into the data base. he goes out and kills people. having data base, making sure that you stop the gun show loophole, those are the kinds of things that congress can do. and enforcing the laws. the alc

. >> give us $1.2 million and could be accomplished by eliminating loopholes. eliminating deductions. ebb gauging in tax reform process to lower rates generally and broaden the base. >> white house officials insist it was made in a different context of the republicans that say it sounds an awful lot like what speaker boehner is pushing for right now in these talks. >> bret: ed henry, let's go down on the subject of defense cuts. doug mckelway has some of the specifics. they involve big numbers. >> for the first time since the passage of the budget control act of 2011, the pentagon today announced off camera briefing it's begun preparing for sequest race, and the harm it would do to national security. >> the white house said the mood should not be read as change in commitment to reach an agreement. >> this is act in response. that were is in stark contrast to the defense contractors in october. midst of the presidential campaign to hold off on issuing a 60-day notice of potential layoffs to workers required by law. >> for to us have gone this long a period of ti

neil: close the loopholes. >> here, that. and however, yes, taxes did go up about a 4 to 1 ratio, things have been wrong in britain. neil: why are they in the else they are -- picking they are in then. >> many people say -- too many cuts too soon on the expenditure side that killed the growth in britain. neil: i think you hike taxes on people, not more quickly puts a chill on things. >> we can agree to disagree on that. neil: no, that might work with imus not with me, all seriousness, why do you see this ending up, remember they went after microsoft in france that was a bigger case. but, i am thinking this more threatening to american companies, this is england saying, we're targeting just you. >> no, britain actually has chairmanship of g-8 next year. at end of day u.s. government, a trillion dollars in revenue, so they will look at loopholes in u.s., and internationally. neil: they will want to first cut loopholes there that would make it less attractive, if you are barack obama you should be rooting for this. that means le

you need to do both deductions and loopholes and, of course, raise the rate. that's the only way the math works. and as far as hurt the economy, let me say for the 10,000th time, bill clinton raised tax rates on the top 2% in 1993 and we then proceeded to grow the economy by 23 million jobs. so, that's a bunch of bull, speaker boehner. >> let's go back to alex with the same question. i will argue that even though he hasn't specified the deductions or the loopholes he's going to close, the governor is right, there isn't enough at the top to close to make up for this advantage they have now but it seems he's accepting the moral argument. he's saying, the rich should get socked, too. that was an amazing admission for him to say to that. your thoughts. >> i agree with you. the fact that john boehner is out there saying we are asking the rich to pay more in taxes is not something they ever would have done in 2011. if you remember, math by details in the sitdown between boehner and obama last year. boehner's office wouldn't write the number 800 billion in its initia

the loophole is called the gun show loophole. there was this concept that at a gun show, if you wanted to sell one gun, and i just wanted to buy one gun, we wouldn't go through a background check because it was too complex. number one, it's not too complex. both of us could use a gun dealer. 99% of the gun dealers in this country do background checks, follow the law to the exact letter of the law. it's not onerous and it really does work. but the gun shows have involved from you just selling one gun to me to you having 500 guns and 10 or 20 like me come in to buy guns from you. it's a way to avoid the federal requirement for a background check. number two, the background check database isn't kept up to date, and the president by executive order could certainly do something like that. there was a disaster, a murder six, eight months, a year ago, a military guy. the military knew he had psychiatric problems. never put that into the database outside of the military. and he goes and kills people. so populating the database. having --

the loophole is called the gun show loophole. there was this concept that at a gun show, if you wanted to sell one gun, and i just wanted to buy one gun, we wouldn't go through a background check because it was too complex. number one, it's not too complex. 99% of the gun dealers in this country do background checks, follow the law to the exact letter of the law. it really does work. but the gun shows have involved from you just selling one gun to me to you having 500 guns and 10 or 20 like me come in to buy guns from you. it's a way to avoid the federal requirement for a background check. the background check database isn't kept up to date, and the president by executive order could certainly do something like that. there was a disaster, a murder six, eight months, a year ago, a military guy. the military knew he had psychiatric problems. never put that into the database outside of the military. and he goes and kills people. so populating the database. having -- making sure that you stop the gun show loophole. those are the kind

that's what part of this gun show loophole. >> reporter: annette elliott runs the show. she takes issue with calling it that. >> it's a private citizen that owns a firearm that can sell it without going through a background check. not just at a gun show but in a trade magazine, to his brother, to his family. >> reporter: to be clear, she says more than half the sellers here have an fll or federal firearms license. they do background checks. but lonnie doesn't. he's selling his assault rifles and says he himself checks. he asks for two forms of virginia i.d. >> the gun shows, even with the loophole, were to private sell from person to person is actually very safe. because i've got so much law enforcement here, nobody's dumb enough to try to break the law on a person to person sale. >> issue, two. >> ban assault weapons now. >> reporter: she says a ban won't work. >> criminal and crazy people do not follow the law. >> reporter: the one thing both sides agree on is their right to bear and sell arms for one and for the other the right to gather and to be heard. >> all you ha

meaning loopholes and deductions out there. available every year. so over a decade that is $11 trillion of available revenues without raising rates. so all you need to do is get less than one in ten of the dollars. one in ten. you've got a $1 trillion in raised revenues without raising rates. the only reason the president insists on raising rates is because he knows it will destroy the republican unity. it will cause a complete fracture of the republican majority in the house. it will hand him a congress that he can then manipulate for the next two years at least. because the republicans will be neutered. this is entirely political action, way to get a surrender from the republicans. and then what what will happen if he succeeds with this, with the fiction that you have to raise rates, rather than eliminate loopholes, is you will have a weakened republicans allowing him to dictate all the terms of whatever entitlement or other reforms if any we will get in the second term. >> bret: what about the specifics? listen, hypocrisy goes both ways, both par

playing around with loopholes and reductions. basically the same plan that mitt romney pushed burg the campaign. but obama stood his ground. he even took his case back to the public with a series of campaign-style stops the past few weeks. and guess what. it's kind of worked. republicans started speaking up not in droves but in numbers not seen in decades to say yeah, the president has the leverage here. we're going to have to give in. that applies to john boehner to. his latest offer is on income over $1 million. obama now says he'll settle for $400,000. so if there's a deal, it's going to be somewhere between those numbers. no matter where it is, it will signal the end of 22 years of total and complete refusal

, but it's bigger than a loophole. that's one area. one of the other issues -- this is why the conversation always goes off the rails -- is that people in the anti-gun side of things tend to demonize the legal gun owners and treat them as barbarians instead of people that they have to have a dialogue with, so you have -- brady campaign is in the middle. they've done a good job in my coverage of nondemonizing people who own guns and believe even in the right of self-defense. >> to that point they were here yesterday. we did a segment on this very subject, and they said they were not arguing with the second amendment. they're -- >> they've given that fight up. >> they're talking about the 40% who are not covered at all by any kind of background checks. >> you know, dan gross, the president, you know, i was speaking to him recently about this. there's the loophole issue, and there's this separate issue, which is how do you keep the non-adjudicated mentally ill, people who haven't gone to -- people who haven't been committ

what loopholes they would close. is it the mortgage interest deduction? we don't know. they do not specify. so again it is a lot -- it is filled with vague promises but here's the big difference. notice what is not included and what they say they will not do. they will not raise tax rates. they will not raise taxes on the top wealthiest 2% of americans. they say no way. no how will that be included. they're dead wrong. they're wasting time. when i saw that proposal yesterday, to coin a word, you know what my reaction was? i was flabbergasted! oh, my god. i was flabbergasted. >> thank you mr. speaker. >> bill: john boehner isn't the only one. flabbergasted that they would have the audacity to put something like that forward when they know it's not going anywhere. it's a total joke. social security has not contributed to the deficit. social security should not be on the table. these guys hate social security so much, they want to get rid of social security and medicare so much that everything they put forward has to have cuts in medicare and social security. so that's a n