Bob Shrum schools Ron Johnson: 'Fantasyland' to credit Reagan for Clinton economy

Tea party-backed Sen. Ron Johnson (R-WI) says that former Republican President Ronald Reagan is responsible for the country's economic success under former Democratic President Bill Clinton and the American people "don't really understand" economic growth.

Johnson told CNN host Soledad O'Brien on Tuesday that it would not be necessary to raise tax rates on the top 2 percent of earners because the country could collect "$750 billion of added revenue through economic growth" without changing tax rates or closing loopholes if the economy continues to recover.

O'Brien noted that the Republican Party was in the tenuous position of opposing the will of the majority of Americans who would like to see tax rates go up on the wealthiest.

"I would imagine that 98 percent of the American population would be in favor of that because we haven't made the case for economic growth," Johnson explained. "The American people really doesn't understand that economic growth is ten times more effective."

Democratic analyst Bob Shrum pointed out that Johnson's assertion that higher tax rates on top earners hurt economic growth was faulty because "under Bill Clinton, we had taxes at 39.6 percent and we created 22 million new jobs. We cut [tax rates] under George Bush and we had almost no net job creation."

"Why do you guys keep making the argument that low taxes for the richest people in the country are the key to job creation when history refutes that?" Shrum wondered.

"We could go do a history lesson, but I would argue that Clinton's economic recovery really dates back to Ronald Reagan," Johnson declared. "He cut rates 28 percent. Listen, I started my business in the '80s, so did Apple, so did Microsoft. Those businesses came to fruition in the '90s. And President Clinton, together with the peace dividend -- also produced by Ronald Reagan -- that's what created that economic engine."

In fact, Apple, Microsoft and Johnson's company, Pacur LLC, were all founded in the 1970s during the administrations of former Presidents Gerald Ford and Jimmy Carter.

The Wisconsin Republican continued by insisting that he would have to see cuts to Obama's health care reform law, Medicare and Social Security before he would even consider raising tax rates on the rich.

"The other problem that is holding our economy back is the explosion of regulations," he added. "And I don't see that we're going to reform these agencies -- the way that you reform them is there you actually cut their budgets because that will force them to focus on the most important parts of the economy to have effective regulations. So, I'd go after the agencies, I would put structural reform to save -- and that's the important point -- to save Social Security and Medicare. And we've got to address this health care law because it is a disaster."

"This is Fantasyland," Shrum shot back. "It's like saying Ronald Reagan invented the Apple iPad. It's crazy. Obamacare is not going to be on the table."

"Here's the bottom line: President Obama, show us your plan," Johnson concluded.

"He gave you a plan," Shrum quipped. "And his plan is not to repeal Obamacare. Not going to happen. You lost the election, buddy."

Watch this video from CNN's Starting Point, broadcast Dec. 4, 2012.