You move over and youre a trillion dollars closer to what tax reform should look like. It is an extremely important first step. If you skip that you end up with a mess. The path to getting it done, if youre able to do that youll lose moderates but it could get through the house but then the senate will be difficult too, isnt it . This has been prenegotiated. There is stuff thats not yet filled in. This has been worked with the senate and governors as well. Obamacare repeal is also the reform of medicaid granting medicaid to the 15 states and having 50 states do as clinton did, 50 different approaches. You learn what works and what doesnt work. Its a reform of medicaid, plus a trillion tax cut. When ryan and the president told the Freedom Caucus go in a room and go back when you can count to 218 that was important rather than have each one whispering about the other kid or trumps ear and they got tired of that and said you guys work it out. Thats where i think they wouldnt have walked out of that room without the level of support they need. There are a lot of members who have debt bills and they want to attack the debt. They would tackle medicare and social security. Do you think that he could change his mind . He was unsuccessful. Do you think it possibly is something he would do in a second term if he wins . All indications are he sticks to the things he said during the campaign. The problem with those promises plus the existing situation is the numbers just dont add up. So i think the thing thats most likely to change his mind is if you go through where we are right now our debt is at the hi highest level since world war i ii. It will be his 10 trillion he has a lot of policies, two spending increases. You cant do that. You cant increase spending and take the most critical part of the budgetory reform off of the table. Of i think the very first step in this process has to be the budget proposal. The budget was a skinny budget. It dealt with onethird of the budget for one year. Soon they will come out with their full budget. The question is how will you have all of those numbers Work Together . What we know from republican is they have been very set on balancing the budget in ten years. You cannot get the balance if you have big tax cuts and importantly take off entitlements without going to and sorry, but numbers are completely unrealistic. The reason we will not have sustained 3 growth, but we have a very different labor market than we have had in the past. There are no credible estimates of all of those policies that could get us up to 3 in a sustained way. What i want to see is a comprehensive plan. That will include bringing our debt down and entitlement reform which we cant walk away from. How do you think tax reform should move through the house . You know the difficulties that health care presented, how do you think they will go about it . You mentioned Trump Administration is on board, leadership is on board. Do you think this is going to be easier or harder than health care . Well, i think its very different than when i first got to congress, which is there is a great difference to what the chairman and leadership are going to do. That is obviously not the case now. It will have to be much more transparent than people were used to years ago. I think it is doable. I met with many members individually reforming tax reform. There is a base of knowledge. There are a lot of new members as well. I think there will have to be a real engagement. Sort of all players on the field can make a big difference. I think very open and transparent and trying to build that consensus and i think it can be done. Do you see the path as usually the house moves a bill along party lines but that perhaps the senate would be more bipartisan . The finance Committee Chairman wants to do some type of bipartisan bill. It would probably have to be republican votes only. The house has been sort of taking that mode for quite a while. I think it is important to talk with democrats. So i expect there would be discussions. I dont know whether house will allow any democrats to vote for the beal. Let me respond. So i think for anything to even a proech bipartisanship the tax cuts will have to move closer to at least what i think democrats think of as tax reform. That involves again, revenue neutrality is probably too low a bar. And any plan will be or at least should be unacceptable to democrats and i believe will be unacceptable to most. On growth i just have to amplify the point. You heard the secretary. I have a lot of respect for the work he is trying to do. You heard him say the tax cut will pay for itself. The tax cut wont pay for itself because no tax cut has come close to paying for anything itself. Its not the same thing as saying they cant ever have any growth impacts but the growth impacts they have, which are uncertain, i can show you evidence of tax cuts that were negative in terms of growth. They are a couple of tenths of a percent at best and often not sustained. It is the idea that you can make up stories about how a lot of these very large aggressive tax cut is going to pay for itself. Lets just agree we can stop pretending on that point. I think you can have dynamic scoring and growing the committee and frankly getting above 2 as opposed to below is huge. It is very important to do that. What i think it really depends on how you put the package together and you are obviously able to do tax reform in such a way that the committeconomy gro. We have had sort of flat growth and meeting incomes. If you can get that that moves that forward, so do we have to stick with a static score . Can a tax cut pay for itself . To it can . It depends how you approach it. I do think the 2003 tax does instead it went up to 13. 3. It raised money from what they said it was going to cost. We cut taxes and the government had more money over that period than they projected without the tax cut. Thats the one tax cut we have had recently. It completely paid for itself. The idea that it never happens is a little silly. If you look at the reagan years we went from 2 growth to 4 growth. Went from 20 to 40 gdp. The revenue went up. You said revenue and you shifted when tax cuts do not pay for themselves. You can also use it for policy issue that is maybe democrats might care about like infrastructure or other types of spending. It doesnt have to be limited to tax policy. I love a good fight about dynamic scoring. Let me just say it clearly has merit. They have more effects on growth and it is useful to make sure. It is important about what will grow the economy. Tax reforms will increase growth or pay for a fraction, maybe 20 of a tax cut. It will increase it by december. You do not want to turn sbiet one thing that it is not. A correlation is not some kind of academic model. They dont. First of all, 2003 tax cut what people said was going to happen and what did. Earlier question was on bipartisan ship. When clinton raised taxes it was just with tax cuts. They cant find one since 1990 when bush found some who were willing to vote for a tax increase and that has largely ended. Of all of the issues taxes are the ones that most divide on a partisan basis. We are not where republicans live north. We are now on two sides of the tax fight. So looking for the tax bill we should always be opened to that. I dont expect any. It is conceivable. If you dont get eight its not worth having. It could be to 60. After you have already got the votes you could see one or two might vote that way. I tend to think the pressures are so strong that it wont happen. Okay. On bipartisan ship i think he is exactly right, that dynamic scoring can show you where it is on the tax side and spending side. Could you bring together tax reform and infrastructure will ch will grow the committee. He just said no. He did say no. But there are a lot of different players. There is potential Something Like that could grow together. I will go back to the point if its paid for. The devils bargain here is unpaid for infrastructure we can increase the debt by twice as much instead of going back to all of the findings that they grow the economy more when they are paid for. Whoever thinks the biggest fight is between taxes i think its people who are willing to make hard choices and people who think you can have something for nothing. As far as the state of the Democratic Party and critics say now why would the democrats want to give any type of victory . Where do you see or do you think that, well, President Trump hasnt been reaching out to them so the tone has been set. I think the problem for democrats is that the gap between Donald Trumps rhetoric in the campaign and extent to which he tried to appeal to working class people who have been left behind and the policies that we heard about on the stage today is huge and growing. I find it very very challenging other than a couple of photo ops to say this is going to help the working class. I really think the split is more one for those whom the committee has worked extremely well over the past few decades and the second group is the majority for bhom it hasnt. Whether youre a d or r, a tax cut that delivers half of its benefits to the top 1 just looks completely wrong to you in the spirit of whats going on in the Real Committee and what the president ran on. It is a massive lobbying fight. Is that the biggest obstacle overcoming lobbying interest . I thithere are common themes that some members of both parties agree with. Ton International Side finding a way to find dollars that are trapped overseas back. I think its something democrats have expressed support for. I have been in the majority twice and minority twice. I know it doesnt stay in one way. You want to bring a couple of people along at a minimum if you can. That wouldnt protect lower taxes. It took the democrats all of two years to begin to undo the Tax Reform Act of four years, two years into the Bush Administration in 90. That was four years later. Many had voted for the tax reform package. The desire is unending. Its not if some democrats voted to cut taxes because they are one of the eight guys and may well, that doesnt change the fact that the rest of them are addicted to having more and more taxes. I mean the challenges, this is the divide between the parties. Its the central divide between the parties. Democrats keep asking for tax increases. They keep asking for the same thing repeatedly and in different ways. Our job is to keep saying no. So let me say that i miss dave camp and you may be alone on that. I dont think so. Stay here. I miss him a little less today. And its not because i agreed with everything he wrote down but his work was always serious and much deeper than anything i have seen since. See, the problem with the way i think you tee this up, grover is its teenaged boys against whomever. Im trying to bring facts to the table here. The percent of people over 65 will grow from 15 to 21 . Thats demographics. Thats not teenaged boys at a prom. Thats reality. People have ideas and i know mya has some. We have good arguments about that. But thats the argument. Its not that democrats want to raise taxes because we are crazy about taxes, its that democrats look at the challenges we face. That bubble does go through the system and comes down later, and so those costs will not always be on the present. They are costs that we face. To deny that is to put the debate in a nonreality, where it has been stuck as lock as ng as have been here. The first thing the democrats did in 2008 was to take 800 billion and throw it up in the air, not to reform entitlements, not to fully fund entitlements. I dont know what youre talking about. An 800 stimulus. It was a very effective piece of work. It gave us less than 2 growth. We are on a different page on that. The reason they want to raise taxes is to that has nothing to do with it. It doesnt have anything to do with the debt. No, the deficit. Contributing less than half a cent. You know, we never felt tax reform would solve all of our problems. Revenues fell dramatically. I always felt tax reform was one tool that could help get our economy growing again. You will not solve all of the problems with tax reform in and of itself. I think it is an important thing we should be talking about and trying to bring consensus on trying to move forward. Youre going to have to have trade offs. Some may have an r after their name but thats not necessarily their crews on policy matters. Do you see that a good amount of conservatives would blow a hole not nations debt problems would vote no . I think they are probably struggling with that right now. We will find out. I think a comprehensive budget is critical. What they need to see is okay. I have been saying i need to balance the budget in ten yores or fo years or four years. Just to balance the budget would require 8 trillion in saving savings. I think we have to get the debt down so its not growing faster than the economy. Any fiscal goal will be just exploded. I think they have to go through kind of the overall trade offs. I think it comes back to entitlement reform. Throughout the campaign the president kept saying he would grow the economy by growth rates. He was going to take that and use it to deal with our fiscal challenges. One, to your point, we cannot fix this problem with tax reform alone. If we used it to pay for it already you cant double count them and also use them to fix the fiscal situation. So one of the promises from the Trump Administration is we are going to grow the economy. You cant say we will use it to pay for everything. Far growth plan to help with fiscal challenges you want to keep things on the table and try to get the debt at least not growing as quickly as its supposed to. Anybody who struggles is going to put having to deal with a plan first. Spending and taxes are not two different project lines. We will do many things. We wont raise taxes. Only then are they ever willing to talk about reform and government. When tax increases are on the table they dont reform government they spend the money. When people say we have prices with entitlements the politician says ill raise taxes to pay for all of the stuff we have been doing and more stuff. Do you say we are not going to do things that dont work anymore, take things that were always stupid and stop doing them and if we are going to do something in addition well find less spending somewhere else. So saying no to tax increases is step one. Im why not have a pledge that says say no to spending ib creases in. I thought about it but its just saying its not as easy. Yeah. Pledges are really dumb. The difference in a much more thoughtful approach is that you can say cutting taxes is good and raising taxes is bad. Its very dynamic. There is a time for both. If you look at the spending side of the equation where all of the spending cuts have come from, i object to this notion of talking about spending as if its this thing up there in the sky, you to get down to cases. If you look at where we have cut spending most and particularly on the nondefense discretionary side. That includes training of workers. That includes Administration Functions people say are very important to them. It is a set of opportunity programs for low income people that means a ton to them. In my view it helps break down some of the opportunity barriers people are struggling with these days but voted for trump to help them with. My problem is he is not doing any of the above. So lets get down to cases. Lets not talk about this. So how do you deal with the nations debt problem would you just keep doing clean debt hikes . Do you increase taxes . What the solution or is it growth . Im with mya on the growth. I dont do magic growth numbers. I think that the in order to raise the revenues we need to both stabilize and bring down the debt we are going to have to raise more revenue. I have a piece that takes you through how to do that. A lot of it has to do with closing loopholes. I think some of the things he was leaning into and certainly key to is closing a bunch of loopholes, capping tax expenditures, getting rid of step up basis, equalizing taxes on labor and nonlabor income. And just to put that thought in perspective we lose 1. 6 trillion per year in tax expenditures. Who is we . The American People or government . The government. We is a different thing. Okay. The government and then we have to make up for it, we the taxpayer have to make up for it or we the citizens have a bigger debt. Im looking forward to the reducing spending. Im a huge supporter of reducing spending. They dont all vote on that stuff. Everybody votes yes or no at a tax increase. The lawmakers do on those laws. They are able to change entitlements. You write the pledge that could hold and look at it. So pick your pronoun. The government looses 1. 6 trillion from tax expenditures. Most are on the individual side and some are on the corporate side. I think the exercise of looking through which of these and then bringing down the rates would be a really good way to do the trade offs. It went through a lot of these exercises. Getting rid of those tax breaks and putting them into lower rate is a very strong plan for growing the economy through tax reform. Even under a dynamic score youre not going to be able to sort of ignore all of those. The reason i did both scores is no tax bill had done. So its going to be incredibly challenges. Im still optimistic that the desire to make sure that the future growth is here in the united states, that Corporate Headquarters remain in the united states, that people have a shot at upward mobility which is what growth and jobs and higher incomes do. I think you can get sort of those metrics which help make the case for the policies that youre trying do. Let me say two things about dynamic scoring. When the tax plan came out and again, there was a ton to admire in that plan. Because dynamic score, they did the right thing. They gave about six different versions of what they thought it would do. Those versions lead to higher gdp growth. The folks who are trying to sell dave camps plan, they chose the 1. 6. This is a cherrypicking opportunity. And cost fell to 6 trillion. Thats how much they found that tax cut would pay for themselves using state of the art methodology. Im not against dynamic scoring. Im against cherry picking and dynamic scoring abuse. We were plowing new ground there. They did give ranges. That was expected. They said revenue would be between 50 and 800 billion. Understood. No. Its been refined. They are required to give a dollar number. There wont be ranges anymore. So part of this process is evolving the modelling and then i would also say many of the outside groups and think tanks and analysis that looked at the bill actually gave it more generous growth nurmbers. I do think it will be a more refined number. I do think well h