What is the best deficit reduction plan, and why?
We’ve not seen a plan that will work economically and politically. The Ryan plan cuts more than others. But no budget plan right now can achieve the necessary deficit reduction and have enough political support to pass.
Two years ago you said an economic stimulus package was warranted. Looking back, was that correct?
I haven’t backed away from support of a stimulus plan as defined by Larry Summers early on. But I never said the plan that was implemented was correct. I felt a package of 40% tax cuts and 60% shovel-ready infrastructure projects was better.
Why – why would that have been better?
It would have had a higher spend-out rate. It would have been more effective. TARP, on the other hand, turned out to be very good. It stabilized the financial system and actually made money for the government. We achieved some positives.
Is tax reform only about bringing down rates?
No. A good tax code is transparent. We have a huge tax gap due to how our code is structured. It doesn’t allow for complete cost recovery. It taxes saving and investment multiple times. It fosters more consumption, taxing it less than savings.
Is corporate tax reform still worth fighting for?
We must recognize more and more growth is occurring beyond the U.S. There is competition around the world for that growth. In that environment we need major changes, or the business will go to foreign competitors.