Graduate of the cobart school of business there and subsequently went to work briefly at u. S. Steel and then the u. S. America mercantile exchange. He joined Goldman Sachs in 1990, became a partner in 1994 and rose up to be the head of the Commodities Division and then ultimately the currency commodities fixed income division. And cohead of the Global Securities division. And then ultimately in 2006 became the president and chief operating officer and director. And he is on a tight schedule, so im going to start right now. Thank you for doing this. Im just wondering how much of my bio you memorized. Well, i memorized it a little bit. Pretty good. So are the eagles bigger in washington or wall street . What egos . No egos. None . Neither place. Okay. And have you found since youve become one of the two point men on the tax bill that youve become very popular . All of a sudden people call you and tell you how important their issue is for National Security or National Defense or whatever reason . No less or no more people called me today than have called me for a long time. Okay. Maybe its just a personality flaw. It seems like no more, no less than before. So people arent calling you more than they did a year ago . Not really. You dont have High School Friend call you, oh, this a few of that. Not really. Its been interesting. You know, people let me do my job. Im sure once they start seeing what we do and how it impacts them, that may change. I think people reserve the right to call me, but so far they havent exercised that option. Okay. So yesterday or today the house leadership unveiled their bill. And you going to have a meeting at the white house with the president and leadership at i guess 1 30. So in talking about it is the bill that was released or supposedly today is that something the president can support . If that bill went through today the president would sign it . David, as you know, the group of six of us came out with a framework. And we got that framework after starting in really diverse different places, the six of us. We got ourselves to a unified framework, which really has two driving principles in it. Driving principle number one is we had to deliver a middle income tax cut. Number two is we had to lower the business tax rate to make us competitive with the rest of the world. The bill that the house delivered today accomplishes both of those objectives. In fact, they stuck very much to the framework that we had delivered. So, yes, the bill that the house has delivered, the ways and Means Committee delivered today is a bill that the president can support. And do you have any reason to think the Senate Finance committee will read the same bill . I think the senate like the house is going down their paths in regular order. One of the other components that we agreed to as a group of six is that we were going to do tax reform in what we would call regular order. We would go through normal committee processes, the Tax Writing Committee in the house, the Tax Writing Committee in the senate, they would write their own bills, they would go through their committee process, they would go to floor. If we needed to go to conference at the end. Thats exactly whats going on here. And thats how were going to get the buyin in the process. The senate is doing that. They are cooperating with the house. And the house did cooperate with the senate. So we are going to get bills that have a lot in common. Im not sure theyre going to be 100 in common, but i think were going to be in agreeing up position to deliver a tax bill to the president s desk this year. This year . This year. So youre very confident that the house and senate will pass and the conference will pass it this year . We are working towards this year. Okay. So did the house leadership tell you that they have the votes in the house to pass it now . The bill just got dropped, we know that the house has been spending enormous amount of time with their members, with their Committee Members as well as the rest of their members working on the details. I am confident and speaker was in the oval office two days ago talking about the bill with the president. We were there together. Im confident the speaker is going to be able to deliver a bill out of the house. When you do these bills, you know, you have a tenyear cost or something, a production cost or costs a certain amount of money. That number is prepared get it through the legislative process. And we happen to very strongly believe that we are going to way, way surpass what theyre going to score on the revenue side of the equation. Okay. Does the treasury have its own revenue estimates are they are just not relevant in terms of these things . No, trade is extremely relevant. They have a large group of people in the treasury that spend enormous amount of time on tax and scoring tax and working on that. And they have their own revenue estimates. We have our own revenue estimates. Everyone else is going to have their own revenue estimates on what the Economic Impact of tax reform what it will do to the economy. But in the end when theyre marking the bill up joint Tax Committee numbers that really matter. So in terms of the bill itself, its a bill that is designed to have 1. 5 trillion of incremental debt at the end of ten years. Wed like to say less revenue. Okay. Thats how the instructions are. The instructions are less revenue. Okay. Now, originally it was supposed to be a revenue neutral bill. Why did the administration and the house go for a 1. 5 trillion deficit increase in debt . So the reconciliation instructions give us room to produce a piece of legislation that has 1. 5 trillion of less revenue on the scoring system that youre talking about. Right. We do not believe that is going to be the actual reality. We believe that by lowering the business tax in the United States and becoming much more competitive with the rest of the world and dropping our rates down we will encourage businesses to come back to the United States and redomicile back to the United States. We are going to grow our economy at a faster rate than the model is going to project. We also believe that by lowering the tax rate on middle american hard working families they are going to spend more money, velocity is going to increase in the system and the economy is going to grow. So we do believe that theres going to be more growth in gdp, more revenue to be taxed and therefore the revenue that theyre saying wont show up, we believe it will show up and we will be able to tax it even though we tax it at a lower rate. Okay. Lets talk about the Corporate Tax cut. Its going to take the Corporate Tax rate from 35 to 20 . Now, theres some people who say why not phase it in over five years. It would cost less money. The administration wanted to do it immediately. Do you think theres a big advantage of doing it immediately versus fazing in . We do think theres a big advantage to bringing it in. Youve sat in a lot of corporate boardrooms, ive sat in a lot of corporate boardrooms. Boards like to know whats going to happen and they like certainty. Yes, itd be nice to say its certain, but theres nothing more certain than by having it happen. We know next year and on top of that giving people a fiveyear expensing window where they can do 100 expensing, we are sending a very clear message that we want you to invest in this country. We want you to move jobs back. We want you to hire people. And were not making it ambiguous. Were making it clear what we want you to do and how were going to grow the economy. The phase in we dont want people to think about investing in this economy. We want you to do it now. So repatriation provision would be under excise, so theres no incentive to keep tax offshore because youre going to pay it back one way or another. So that money will all come back presumably. Is there any incentive that the people who bring it back, companies who bring it back have to create jobs . Or what are they likely to do with the cash . Does anybody have any idea . So, david, youre right. The repatriation deemed safe, so its not like you get the choice to bring it back or not bring it back, were going to collect a tax on you over the tax window whether you bring the money back or not. Were going to create an environment where we hope that you invest this back in your business. But ultimately either youre going to invest it back in your business or you can distribute out of your business to someone else whos going to reinvest it back into another business. O lets talk about some of the controversial provisions. Of course controversy is in the eye of the beholder, but lets talk about state and local income tax. You must be very familiar with that. Ive heard about it. Right. So in states in new york, massachusetts, other high taxing states, high state and local income tax, they will no longer residents of those states will no longer be able to deduct this income tax, is that correct . In this proposal. It is sort of correct. There are a couple little provisions in there that we did add back some real estate taxes property tax if you do choose to be an itemizer. So as a whole we have eliminated the vast majority of those deductions. Dont you believe that will be very difficult for high state tax representatives or centers to agree to that provision . David, the other day this comes down to are we delivering a middle income working family tax cut or not. We believe that the house plan is delivering that. And when you score it out and when you see the distributions and the distribution tables will be out relatively shortly, the distribution tables will determine whether were delivering that tax cut or not. We believe that this plan that the house laid out is able to adequately deliver that distribution to those working families where we told you we were going to deliver that, that tax cut. The average family of four and materials that came out today is medium family of four income is 59,000 and they will get a tax cut of about 1,140 or Something Like that, roughly . I wont argue for 40 dollars. So the median family of four will get it. What about the people who are in the upper income . Will they be getting a tax increase or tax cut or just neutral . Look, it depends on each and everyones individual circumstances. As you know the hard part about taxes is everyone has their own unique set of circumstances. We set out with the objective and i said we had two objectives, middle income tax relief and Corporate Tax relief. We have not targeted the upper income brackets, but we do believe there are quite a bit in for the upper income families. Were dealing with a state tax. And were dealing with other things that affect upper income taxpayers. So we do believe when you look at the package in its entirety, were able to touch every taxpayer in some positive way. So look at the estate tax. Youre going to phase that out over a period of time. So i think the estate tax goes away in four or five years under the proposal. Why not just get away with it right now immediately . Just cost too much . Again, its about scoring. I think the house plan is 24, but theyre going to double the exemptions day one so next year double the exemption to 11 million, a person with 22 million for a married couple and then in 24 full extension on the gift tax. But the gift tax will stay in place more or less. I dont know what theyre going to do, theres definitely going to be gift tax restrictions in there. In other words if you want to give money to your children, youre better off to wait for years to die then youll get it tax free youll have to debate that with your children. I think my children prefer i stay alive. Well, i have no doubt that thats the case. Im not sure it is in my case. So lets talk about universities. New provision that many people didnt anticipate is now in there which says if youre a university and you have a private university, not a Public University, you have an endowment could be a 2 tax on that endowment income, why not include if youre going to do something Public University have big endowments as well. The house is making a decision on how they want to balance the bill, how they want to make it work. Its over a billiondollar threshold. Its not the first dollar of endowment that you have. I also think there are some laws in the system about taxing private entities versus public entities, youre getting into a layer of tax legality that i will admit is above my understanding of the tax code. I doubt theres anything at this point. Now, you work on very complex corporate transactions. Have you ever worked on anything as complex as the tax code . Probably not. Probably not. I mean, its got as many moving parts and more constituencies than ive seen in almost any transactions than any transaction ive ever done. Now, this bill is designed to pay us with no democratic votes. Can the Administration Live with that . Yes. We prefer it to be bipartisan. And we have spent enormous amount of time trying to make it bipartisan. I think youve seen that the president is traveled with democratic members of the senate to their states to talk about the bill. The president has had dinners with Democratic Senate members. Weve had bipartisan meetings. Both the house and senate in the white house. I and secretary mnuchin spent a lot of time with different democratic groups. Weve met with the blue dog dems a couple different times trying to get bipartisan support for what were doing. We would love to have a bipartisan 60vote bill. But if its a republicanonly vote, the president s still going to sign it. Hes not going to not sign it. It delivers middle class tax relief and 20 Corporate Tax relief and it shows up, i can guarantee you hes going to sign it. And does the president expect to be involved in lobbying members for votes . Or is he going to say now its a house problem or senate problem, ill stay above the flame . Or is he going to get involved in lobbying . The president cares a lot about tax reform. This is one of his main pillars that he ran on. Its all about cleaning up washington. Its all about making the system fair. Its all about returning hard earned income tax to middle class families, the president s going to do what he needs to do to make sure we deliver on his campaign promise. Lets get back to a few other things before we get back to tax reform. Lets talk about trade. Another easy issue. Nafta. Do you expect there will be a renegotiation that will be agreed to . Or do you think theres more likely that well pull out of nafta . We are trying to renegotiate nafta to be fair, to be good for American Workers, to be good for american jobs and to make sure all american based companies are treated fairly in the free trade system. All right. So you think you will work out a deal . Were trying. Negotiators are continuously meeting. And were continuously trying to get to a point where we think that american based companies with american based manufacturers are treated as fairly in the agreement. Okay. In terms of trade the president will be going to china shortly. He has from time to time been upset with the trade deficit we have with china. Does he have any plans to do anything about that or mention that to sxi jinping when hes there . I would probably assume it gets mentioned. Okay. And what about south korea . Hes not going there but hes been upset about the treaty we have with south korea. He is going there. Oh, im sorry, hes going to vietnam, south korea, japan and china, is that right . Hes going to tokyo and then yeah, and the philippines. So he goes to south korea he will mention the trade imbalance . Uhhuh. Okay. Let me ask you hes also got many other issues on his agenda. Obviously north koreas a big issue. Hes going to spend a lot of time talking about north korea. He has gone overseas before, you have gone with him but now your responsibility is to get the tax bill so youre not going to go on this trip . Yes. I had a long discussion with the president where i thought it was a better use of my time. Not that the trip isnt unbelievably important, but our, you know, tax reform is so important that i thought being here and working with congress and secretary mnuchin is in the same place that the two of us staying here and working with congress to make sure the tax reform stays on his agenda while hes gone. Its a long trip hes gone over 12 days that we should stay here and work on that. Thats what were going to do. When youre doing that, will there be when theyre having markups, theyll be calling you because your input is valuable and so you expect a lot of back and forth . Yeah, we have great relationship with leaderships of both house and senate, with the committee chairs, committee leaders. Were in relatively constant dialogue with them on where theyre heading, what their ideas are, what their concepts are and making sure were all working together to get a bill to the president s desk. Now, on health care legislation, do you expect that will be revived as a possible thing to do . After tax care or tax reform . I mean, right now were planning on looking at health care in a year. Okay. There was a rumor that maybe the president or somebody wanted to have elimination of the mandate in the tax bill, the health care mandate, is that off the table now . The president tweeted that yesterday. So its not off the table. Its something that could be looked at. Okay. And we are spending a little bit of time looking at that. And if it works and we have votes, the president would be inclined to have us look at it and look at it quite aggressively if we can get that down as well. The president , when he does a tweet, does he call you and say im going to do a tweet in a certain area . Does he consult with you sometimes or not so much . Sometimes yes, sometimes no, depends on the time. Okay. In terms of your background, you have been very public about the fact that you were not a great student because you were dyslexic. Uhhuh. How did you realize you were dyslexic . And how did your family get you treatment for that . Well, i try and explain this to people. This audience might be the right age to understand this. In the 1960s when i was growing up as a dyslexic kid, i dont know if dyslexia was sort of a commonplace name for a disease. So when i was growing up, you know, it was not diagnosed, or if it was diagn