Former Congressman Ed Case and state Senate President Colleen Hanabusa said last night that they would likely vote to let President Bush-era tax breaks for the wealthy expire if elected to Congress, while Honolulu City Councilman Charles Djou said he would extend the tax cuts.

President Obama's budget would allow federal income tax breaks for the wealthy — individuals earning more $200,000 a year and families earning over $250,000 a year — expire as scheduled at the end of the year. The proposal would have upper-income tax brackets revert to 36 percent — from 33 percent — and 39.6 percent — from 35 percent, after nearly a decade at the lower rates.

"Things aren't free. They're simply not free. You've got to face the music somewhere," Case, a Democrat, said at a community forum for the candidates for Congress in Mō'ili'ili.

Case said the federal budget deficit grew under Bush primarily because of what he called massive tax cuts and the failure to curb federal spending. He said he may consider extending the lower tax rates on capital gains and dividends but would let the income tax cuts for the wealthy expire.

Hanabusa, a Democrat, said she would also let the tax cuts on the wealthy expire. She said President Bill Clinton left a surplus that turned into a deficit under President George W. Bush through tax cuts, increased spending, and the war in Iraq that she said she never supported.

"I believe once we went down that path, we caused the downfall of where we are now in terms of the economy," she said.

Djou, a Republican, attacked what he described as a mentality in Congress to tax and spend the country to recovery.

"I have far more faith in hundreds of millions of Americans spending a few hundred dollars, than a few hundred bureaucrats spending hundreds of billions of dollars," he said.

The three leading candidates in the May special election for Congress appeared at a forum at the Willows Restaurant in Mō'ili'ili. Mō'ili'ili Matters, an online social network of community advocates, sponsored the debate. The candidates took questions from members of the group and others in the audience on the economy, Native Hawaiian federal recognition, the environment, education, and Social Security.

The winner of the special election will fill out the remaining months in former U.S. Rep. Neil Abercrombie's term in urban Honolulu's 1st Congressional District. Abercrombie resigned to focus on his campaign in the Democratic primary for governor.

2 MORE ROUNDS AHEAD

The contenders are also running in the September primary and November general election to replace Abercrombie in Congress.

The special election has received national attention, as national Democrats and Republicans are looking for a good story out of Hawai'i to help define the upcoming midterm elections. Democrats want to hold territory in President Obama's hometown congressional district; Republicans want another surprise like U.S. Sen. Scott Brown's GOP victory in Massachusetts in January.

Private polls show the race contracting, with the potential for Case and Hanabusa to split the Democratic vote and create an opportunity for Djou.

Asked how they would resist political influence and gamesmanship if elected to Congress, all three invited voters to look at their records and described themselves as reformers.

Hanabusa cited her early record for standing for civil-service reform at the state Legislature, but also her ability to work with colleagues, including Republicans.

She said a leader is "someone who can argue a point and still respectfully disagree when you need to and agree when you need to."

Djou said he chose to decide to run for Congress before Abercrombie announced he would leave office and before his challengers stepped forward.

Djou said he wants to take his record of fiscal conservatism to Congress "not because of politics, not because I've been anointed by some party higher-ups, not because it fits neatly in my political career, but because that's exactly what we need on Capitol Hill today."

Case, who is opposed by U.S. Sen. Daniel K. Inouye and many of the state's labor leaders, who prefer Hanabusa, said he hoped Djou's remarks were not directed at him.

"Well, Charles, I hope you weren't referring to me when you referred to 'party higher-up,' " he said to laughter in the audience. "I don't think that applies to me."