October 5, 2010

SING OUT, BROTHER:

'Things Could Get Pretty Messy': The man who would be the next House majority leader talks about the GOP agenda and working with Obama. (STEVE MOORE , 10/02/10, WSJ)

The Republicans have released their "Pledge to America" policy agenda, so I ask the congressman what comes first if the Republicans become the majority in November. Mr. Cantor says if Democrats allow the income and investment tax rates to rise in January, "I promise you, H.R. 1 will be to retroactively restore the lower rates so no one has a tax increase in 2011."

Step two will be "cutting spending as much as we can." House Republicans hope to "take a cue" from Republican Govs. Chris Christie of New Jersey and Bob McDonnell of Virginia, who made steep spending cuts in their first year in office. "We will cut programs, we will try to rein in the size of the bureaucracy. We will bring federal pay scales that have become so exaggerated into line with market rates," the congressman says.

Mr. Cantor also hopes to eliminate whole programs and departments by putting sunset provisions into law. "Why would you want a federal program to exist, if number one, it's not executing its mission and, number two, . . . if the mission is not valid anymore?" He cites 17 duplicative education programs, and federal technology grants.

This ambitious downsizing agenda could set up a 1995-style budget showdown. That year, President Bill Clinton vetoed Speaker Newt Gingrich's budget, which led to a fateful showdown that many believe revitalized the Clinton presidency.

Are we headed there again? "No, Mr. Cantor says, "I don't think the country needs or wants a shutdown." He thinks such a scenario can be prevented if the Republicans "relentlessly make the case for how government overspending and debt are strangling the future competitiveness and growth of this country."

Mr. Cantor assures me he understands that this downsizing plan may run into a roadblock from some in his own party. Republican appropriators tripped up the limited-government strategy in the late 1990s and during George W. Bush's presidency. "We know that appropriators will fight these cutbacks," he says. "But by eliminating earmarks, we can stop the horse trading that grows agency budgets." He tells me he would be "open-minded to term limits for the appropriations committee," on which he hopes Republicans will place fiscal conservatives. But the top-ranking Republicans on the House appropriations committee—including Jerry Lewis of California, who is in line to be chairman—are spenders extraordinaire who could capsize the GOP budget-reduction agenda.

Mr. Cantor's economic outlook is certainly one that resonates with conservatives. But many are grumbling that the Pledge to America didn't also include a promise to end earmarks. "Don't mistake this year's Republican caucus with next year's," Mr. Cantor responds. "We're going to do real earmark reform even though it was missing from the pledge. If you look at the makeup of the conference right now, and then add on to that the incoming freshmen class, those folks aren't coming to Washington [for] . . . pork-barrel spending. They really aren't."

Another concern is that Republicans lack a coherent growth agenda beyond simply cutting spending. To this, Mr. Cantor objects: "We will start by unraveling the economic damage that has been done by their agenda, whether it's health care, or whether it's the financial reg reform or regulations from EPA that are strangling businesses."

He strongly favors ending the drilling ban in the Gulf of Mexico, "which is costing us thousands of jobs." Still, he adds that Republicans "have to be careful about how we do it. We don't want to be seen as a bunch of yahoos."

As for taxes, Mr. Cantor says he "would like to see the cap-gains rate reduced to nothing because that's what angel investors, who go and fund start-ups, look at. If you want that kind of growth and incubation, you've got to look at incentives to put capital at risk."

"Next," he continues, "in a perfect world we would bring corporate tax rates down to 25% or less so we can get competitive in the world economy. Ultimately, I would love to see a flat tax."


Every bill Congress passes should have a sunset provision.

Posted by Orrin Judd at October 5, 2010 6:20 AM
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