Leaders of bureaucratic institutions have tried before so it was new for the world and grip. I am glad we did it. If we had not done it, we would have to start now. That is my advice. Get great help and then figure out what you need to do and then just get started and finished as soon as possible. Jim yong kim, rebecca blumenstein, thank you. [applause] wisconsin resident of paul ryan also spoke at the wall street journal annual conference. The chair of the ways and Means Committee discussed tax policies. This is about 30 minutes. Can really welcome, congressman. Good morning to everyone out there. I want to Start Talking about the news out there. You and another center senators sent a letter to the Treasury Department talking about basically version and proper shifting project. It has not gotten a lot of attention, but it seems to be a big deal. Talk a little bit about what was in the letter and how you see that in terms of your own efforts to work on the tax code. Rep. Ryan it certainly has the attention of tax writers. First of all, we come from the school of thought which believes and tax competition, not harmonization. It means we want to see countries compete for more Free Enterprise taxes. It is not trying to harmonize everyones taxes up. Kimberly which is what this project is attempting to do. Rep. Ryan correct. Its also attempting to grab a tax base of our domestic corporations. We want to make sure our treasury has a united front against the best direction project, which is one of the reasons we stood up and spoke of that. The other thing is we want to bring attention to having to deal with the tax based issues in such a way that we want to give america the place but its where it is a haven. They call it highly mobile ip income. We want to make sure that america is a place where it makes sense to keep those operations here because of our favorable tax treatment. Those are the kinds of things we talk about one we talk about International Tax reform as a component of tax reform. Kimberly what are the biggest threats to u. S. Businesses from this project . Where they are headed on these rules . Rep. Ryan that you will have a system where there is no haven for lower tax rates and we have other countries trying to assert their jurisdiction into our domestic firms to tax them. Where we break down these traditionally observed International Legal barriers between firms and countries. Kimberly there seems to be other things like disclosure requirements. You mentioned them in the letter. Rep. Ryan that is something we are very concerned about. Were concerned about ip protection, data protection, and the privacy of firms. I think we will probably get into this conversation on tax reform we want to acknowledge the fact that it is probably in our interest to see if we can move quickly to do International Reforms that address this issue so as to cauterize it, in a way, to prevent the Corporate Tax base being eroded so we have a tax base to work with. Kimberly so this adds to the urgency of doing something here. Do you think that is widely understood in the congress . Rep. Ryan not really. Its the people involved in taxwriting do this. I think the members of congress understand that america has a terrible tax system, very anticompetitive. It locks money up overseas and versions typically get the headlines, but it is also takeovers of Foreign Companies buying u. S. Companies because of the tax arbitrage forest is it. Tax policy other countries have. Members of congress are on an increasing basis seeing this sense of urgency. I do think this issue is something for everybody. Kimberly do you think the treasury has the authority to sign on to this . Rep. Ryan no. That congress has to. D think the Obama Administration agrees with you . Rep. Ryan i have had a decent amount of conversations with the treasury. I think they agreed with our view of things more than not but not in every instance. We want to make sure this is clear that the legislative branch is the one that writes the laws and nothing other than that. Kimberly you mention this issue of the Corporate Tax base. How much does that to the urgency, because it seems we are heading in a direction where you may not have a base reform at a certain point. Rep. Ryan if the Corporate Tax base you wrote so much because of all of these International Rules or because of our absolutely inferior tax system or tax treatment of u. S. Corporations, we will not have a tax base with which to reform our tax code. That is important. For those of us who were comprehensive tax reform, we think it is important that we stabilize our tax base so it can get to that day. Can we do that with this president , that is probably more you want to go with this. There is a big difference between our view and the president s. We think taxes should be lower for individuals. This president is 466 percent overseas. Which is late. Canadians are 15 . The international average tax rate on businesses is 25 . We have to get things down across the board. That is something the administration does not share with us. There is an impasse. Kimberly so no comprehensive tax, that is all the deal. Rep. Ryan it will not happen for dust with an administration that for ideological or other regions cannot get to where you need to go to have a truly reformed comprehensive tax system. So the question for us is what can we do in the meantime that gets us a step in the right direction . Lets say there are 12 things to do to get through comprehensive tax reform can we get to were three of them done. As we do that, we do that, were looking at the international system. We want to move to an exemption system. We won every day a recreation we want to fix this clumsy system that we have and so the way that we look at this is can we set up something that we know is when to be a permanent future of the new system anyway that helps protect the tax base and helps get american firms in a more competitive footing. Kimberly what are the top prospects of that . Having mentioned that you cant do Corporate Tax reform, given all the things you have said what can you do that gets you in these that in the right direction that deals with the threat on the International Harmonization . Rep. Ryan we think a conversion from a worldwide system to an exemption system is something that we would like to be in the cards. Tax extenders applies to both sides of the code that has to get done and we believe many of these provisions should be permanent. We think that is in the right direction for the tax reform. Some are going to grandfather on and some ought to be permanent. We have to figure out how to get in the right direction. Theres a lot of talk about an Innovation Box as the way for having lower tax rates to help keep the income here and making the system a little more competitive in the form we getting the comprehensive leader on. So we see the tax reform either as one bigger second 2017 or one now which we can bite off what we chew and get done and make us competitive and then the rest of it done in 2017. Kimberly what are some of the ones that should go away . Rep. Ryan i will not get into that. It does not help to get into the goal of comprehensive tax reform to do this on anecdotal bases outside is showing what the new system we are trying to get to. We ask everyone who cares about provisions in the tax code is to understand our goal is a better tax code for america, more progrowth that makes us more competitive globally. In the context of that, consider the end result. When we go through this anecdotal yesterdays, noted that without showing comprehensive visions, it is counterproductive to getting it done. Kimberly how do you sure companies that it is worthwhile thinking and taking the long view . Rep. Ryan i think people realize that. Kimberly given the situation that we have not necessarily accomplished rep. Ryan we have to win an election first. I have been involved in some of these things, we need to tell people who we are, what we believe, and what we will do if elected. So then how the obligation and made it to do that if elected. This is the biggest priority of the ways and Means Committee, to me. Comprehensive tax reform. It is a matter of economic survival and competitiveness. We did in 1986. The world followed suit. It triggered a round of tax competition. So now we have the worst code in the industrialized world. We need to kick off a new round. Kimberly where do you think, of the ideas you mentioned, the administration is most likely going to work with you on . Rep. Ryan we do talk with treasury, in particular, a bit about international conversion. And extenders. There are active conversations about how do we get that taken care of. There is also a component about the fact of if you go from worldwide to it and exempted system, there is a slug of money that comes into the system. Some folks want to see that as a Highway Trust Fund solution. I believe it is a way of doing it where it does not deter taxes only want to do as well. We are discussing and exploring these so if we find Common Ground on this piece, which we see as consistent with tax reform with which is something we do not think is kimberly can you do the steps you mentioned that balances the issues of secor and Small Businesses . Rep. Ryan that is what comprehensive tax reform is all about. Unfortunately for us we do not have an administration that sees it that way. They want high tax rates on individuals. I believe, in a better political climate, which is hopefully in 2017 there are other ideas out there, we want to spend 2016 exploring those ideas and encouraging talking. It will lower rates across the board so you have more parity. We used to have that until we had the fiscal cliff. Kimberly what is the timing on this . We are already in the midst of 2016 president ial elections. Rep. Ryan it will be this summer and fall. As we go through this summer, we will continue to explore the international. In the fall is, if we do something, we would have to do that. Extenders, we want to do as early as possible. December 11 last year, we had to find out until then to see if these provisions will be extended, only to see them go away december 31. That is not certainty. We want to address that as soon the can. Kimberly how are you going to spend your time in 2016 . Your predecessor spent years going through having all of these sessions, which were very bipartisan. There were a lot of people on both sides of the aisle interested. Coming up with what you and i would call a traditional tax reform. The idea to broaden the base and lower the wage. What we have out there now is a whole bunch of candidates on both sides talking about major changes. Can you talk about some of those on what you think is what are some of the ideas of a totally different kind of tax code . Rep. Ryan that also be encouraged. That outside the box thinking. I am thankful for dave camp and that what he has done. Not just the intellectual work but the scorekeeping work. All the nuts and bolts work you have to do to do tax law writing and reform. We are building off our Knowledge Base of that work. The base case, as we see it, in 2017, is that are the very least we do is are a variety tax reform. Broaden the base, lower the rates. The base case from our perspective is that should be no higher than 25 , no matter which corporation you are. We are the highest rate in the industrialized world. That is not even the escort your talking about. The question is can we come up with a leapfrog plan that lead cross the rest of the world and shows them we had a even more secure your tax for a system that better that is better than the rest of the worlds. Given the fact that our size of government relative to the size of our economy, about 20 of gdp , is smaller than most other countries , surely one of the weaker, with a better system that would rise above what anyone else has. You want to invert into america. You want to found your company and your business in america. Manufacturer in america. It makes sense to do that. Because of our intellectual property and rule of law and workforce our currency, we want to be an american firm. Those of the kinds of things we think about. At the least, we are going in a better direction if we seek get the government we are seeking, which is good tax reform that gets us competitive or even something superior. We will spend 2016 looking into all of that. Doing hearings, Research Examining these things. Kimberly anyones you particularly youre not going to go there. Consumption taxes all out on the rep. Ryan all of these things are things we want to encourage a robust conversation on. It is about america leading becoming a place where we get faster economic growth, more mobility and opportunity. One of the biggest drags on the goal is our tax system. Kimberly can you do a major when bush came into office, he had his tax proposals. But they cost money. We are in a different if they were not deficit neutral, as it were. Can you do that in a environment today where the debt is where it is and the deficit is what it is . If you cannot, can you have a tax code and aggressive enough to go . Rep. Ryan i think the answer is yes. Kimberly yes, you can do it, so the public on it . Rep. Ryan yes, you can get a tax plan through. We improved a couple of our tools that we used to write tax bill this year. We improved modeling capabilities, and were still refining that. To the point where we actually use Economic Modeling that looks at how the economy response to tax changes. Go figure, human beings respond to changes in government policy. Until this year, we do not take that into account. We used static scoring in the past. Now we use macroeconomic storing macroeconomic scoring which is what i called realitybased scoring. We do that now so we make smarter decisions. The Revenue Target that has been traditionally used sets of sets revenue higher than what the law actually is. So we believe in what we call the current policy Revenue Target which is the truth. The r b credit gets renewed every single year. Our friends on the other side of the aisle say they do it every year. But the moment we say make this permanent, they say no. Raise taxes on someone else. What they are basically saying is if you have to raise taxes on other hardworking americans to keep them the same for anybody else. It is a false dichotomy. If these are provisions, r b credit section 179, that we intend to permanent and will always extend on an annual basis , lets call it what it is an be honest with ourselves and make it that. That gives us the kind of Revenue Target, combined with better scorekeeping roles that are more reflective of reality that we think will be better progress legislation then we have been in the past. Kimberly isnt what youre talking about someone in opposition with not only democrats but some republicans now who have embraced the idea , that you need to be using the tax code more to reward middle class families, more deduction more exemptions, that is on the personal side, i know, but you know it leads into the business side as well. So you are talking about a path of people that are going very much different direction. Rep. Ryan i believe in limited government. I guess i am more libertarian on this issue. It is your money. The way that these conversations turn out, which is we want you to send your money to washington and then if you engage in behavior that we approve of, we will let you keep some of it back. I would rather you keep it in the first place. It comes from the people who made an earned it. Decide for yourself what you want to do with your money. I believe in a more economic and neutral tax system. The reason i believe that is for, one, freedoms sake libertys and growths sake. The best way to help families and help people get out of poverty is a faster economic growth. You do not want to leave any growth on the table. That is why our texture and principles are profamily progrowth probusiness entrepreneurial and that is kind of the school of thought i generally come from. Kimberly so you have some of the more powerful people in the come in the country in the room it in terms of companies. What is the Corporate Community need to help you get this done . Rep. Ryan do not fight for the tiny table scraps or the carved out piece of an exemption here or that benefit that might be good for the industry here. Think about the broader goal of getting the tax rate down and the goal of getting america to a more competitive system. Even if you might lose this particular carved out benefit, think of the broader goal, which is a more competitive tax system which means more competitive growth and it makes you want to stay as a United States company instead of having temptations from shareholders to convert or whatever. That is what i asked able to think about. Questions from the audience. This one asks you to appear into your soul, congressman. Kimberly if he has one. [laughter] we are about to find out. Imagine you are a cfo and you see an opportunity to purchase another company in your industry in a happens to be located in the u. K. You can save 100 million or increase your earnings 20 by doing so by accomplishing this inversion. You compelled you feel compelled as a fiduciary to get into this on behalf of the shareholders. What would you do, stay patriotic or fulfilled your fiduciary . Kimberly dichotomy. Rep. Ryan it gives us a chance to get our political system fixed so we can fix this thing and you will have your cake and eat it, too. You will be an American Company entering a better tax system because we will have fixed this mess before it gets out of control. George osmond and i talk about this. They are rocking and rolling over there. There are a lot of lessons to be learned here. Please note we are trying to apply these lessons. We do not have the political plans aligned like we need to to fix this. This is our highest priority. We are moving as fast as possible in this direction as we can. Play the long game with us and do not go for the gratification. That is what my soul says. I would hesitate asking what the cfos may do in this case. Beyond the need