My chat with Jon Huntsman about his economic plan
I spoke with Republican presidential candidate Jon Huntsman on Tuesday evening, just as he was putting the finishing touches on his economic plan, which he announced Wednesday. (Here are all the details.) Some excerpts from our conversation:
On what’s wrong with the U.S. economy …
We have a jobs crisis on our hands in this country, and first and foremost we need to rebuild our core. And the core that I’m talking about is our economy. This world always needs an engine of growth to pull the global economy along, and China has been an engine of growth. And the next two or three years could prove problematic in terms of China maintaining its status as an engine of growth.
So all the more we’ve got to get back on our feet and get our act together. What we’re doing is based on common sense; it’s based on experience; it’s based on real-world solutions. There is no lack of solutions, just a lack of serious leadership. I draw my inspiration from basically three things. One of them is the Ryan plan. The second is the Simpson-Bowles deficit commission report. And the third is energy independence from the Pickens Plan.
On Rep. Paul Ryan’s debt reduction plan …
I embrace the Ryan plan. The content there is basically going to drive me forward in terms of debt and spending and how we get this country to 19 percent of GDP in spending as opposed to 23 percent. That is the model I would work from. It might not be the final position, but it is the going-in position for me. I like what it advocates for Medicaid. I like what it talks about in terms of Medicare.
On tax reform …
In order to infuse predictability and certainty into the marketplace – which it doesn’t have today and therefore it has no confidence and therefore you don’t have business employing and you don’t have business releasing capital expenditures into the marketplace — you have to get certainty in terms of tax reform. We’re going to lower rates [23 percent, 14 percent, 8 percent and a zero capital gains rate] with three brackets and an income tax return that would resemble a post card. This is reminiscent of what I did as governor where I actually created something close to a flat tax where we worked to eliminate all the deductions and loopholes.
So I am premising both individual and corporate tax reform [with a top rate lowered to 24 percent] on clearing the cobwebs out. You pay for it by eliminating corporate welfare, by phasing out subsidies and loopholes and deductions. My goal would be to phase out everything on the corporate side and the individual side. I know that is controversial. I know there is a political risk there. But that is the only way you can raise the revenue to buy down the rates. There ‘s no other way to pay for it. When I was governor it took us two years, we brought both parties together and we got it done. So I am coming at this exercise as probably the only person in the race who’s actually been through this effort before.
On regulatory reform …
We are going to call for rolling back existing regulations, specifically Obamacare and Dodd-Frank. We are going to call for dramatically reigning in the EPA. We are going to curb the excesses of independent agencies like the [National Labor Relations Board], which is standing in the way of legitimate job creation in South Carolina with the Boeing plant.
If you want an example of a housing market that is on the move, why is it that Vancouver the hottest housing market in the world today? Because they have a clear and defined and user-friendly legal immigration policy. They’ve got people coming in and investing in their marketplace, bringing up values. We need to fix our H-1B visa program, as well.
On China and free trade:
We’ve got to use the tools that we’ve got under the [World Trade Organization] and use them aggressively. But more importantly, we’ve got to get our house in order here. We have less leverage at the negotiating table today with China and less clout because our own economy is broken. If you want to get the attention of the Chinese – and I can tell you having done this for 30 years both in business and in government – you’ve got to have some leverage and some economic strength behind you. We have to restore our economic core and that would do more for our leverage than any WTO case.
We’ve also got, and I did this as ambassador, to engage the emerging private sector in China to begin to push issues like intellectual property protection because it is in their interest as innovators and entrepreneurs and creators to make sure China steps up and and does more. I lived in Taiwan in the 1980s. Taiwan was an egregious violator on the enforcement side of intellectual property rights, as bad as China has been in recent years. But the minute their entrepreneurial class started to develop their own intellectual property, they turned on a dime and lobbied their own government. That same creative class is emerging very, very quickly in China.
On dealing with climate change …
China and India are not willing to play on the same playing field. And we should not be unilaterally disarming, in a sense, especially at at a time when we need to get this economy back on its feet. The last thing we should be doing is anything that would hinder job growth and economic expansion. I am not going to have any discussion about it until such time as we get China and India tuned into the issue. They’re not now, and I don’t thing they will be for some time.