Thank you. It is great to be in the stomping grounds of a great
conservative senator, Jim DeMint. I want to thank ISO Poly Films CEO
John McClure for opening his business as we discuss my plan to get
America working again.
Today I lay before the American People my cut, balance and grow plan.
It cuts taxes and spending. It balances the budget by 2020. And it
grows jobs and the economy.
It neither reshuffles the status quo, nor does it expand the ways
Washington can reach into our pocketbooks.
It reorders the way they do business in Washington by reinventing the
tax code and restoring our nation to fiscal health through balanced
budgets and entitlement reform.
Central to my plan is giving every American the option of throwing out
the three million words of the current tax code, and the costs of
complying with that code, in order to pay a 20 percent flat tax on
their income.
The size of the current code, which is more than 72,000 pages, is
represented by this pallet and its many reams of paper.
The best representation of my plan is this post card, which taxpayers
will be able to fill out to file their taxes.
Each individual taxpayer will have a choice: you can continue to pay
taxes, as well as accountants and lawyers under the current system, or,
you can file your taxes on a postcard, with deductions only for
interest on a mortgage, charitable giving, and state and local tax
payments.
Under my plan, you will no longer have to worry about paying taxes on
social security when you retire, or your family members paying the
death tax when you die. And you can wave goodbye to the capital gains
tax, as well as the tax on dividends.
We will increase the standard exemption for individuals and dependents
to $12,500, meaning families in the middle on the lower end of the
economic scale will have the opportunity to get ahead. Taxes will be
cut across all income groups in America. The net benefit will be more
money in Americans’ pockets, with greater investment in the private
economy instead of the federal government.
On the corporate tax side, I am offering equally bold reform. My plan
closes corporate loopholes, ends the special breaks for special
interests, and stops the gravy train of lobbyists and tax lawyers at
the Washington trough.
In exchange for a corporate tax free of carve-outs and exclusions, I
offer a much lower rate of 20 percent that represents the average
corporate rate among the developed nations, and that will make our
corporations more competitive on a global scale.
We will shut down the cottage industry of corporate tax evasion by
creating a tax that is broad, fair and low.
And my plan offers incentives for corporations to invest in America
again, with two major reforms. First, we will transition to a
territorial tax system on corporate income earned overseas. This means
companies pay the appropriate corporate tax in the country where income
was earned, but aren’t taxed a second time when that income is moved
back into the United States.
Second, for all corporate profits currently languishing overseas, I
will offer a one-time reduced tax rate of five and a quarter percent
for a limited period of time on repatriated earnings.
The U.S. Chamber estimates this one-time tax reduction would bring more
than $1 trillion in capital back to the U.S, create up to 2.9 million
jobs, and increase economic output by $360 billion.
In other words, it’s the kind of economic stimulus President Obama
could have achieved if he wasn’t hell-bent on passing big government
schemes that have failed American workers.
Today, America’s combined corporate tax rate of 39.2 percent is the
second highest in the developed world. It is time to overhaul our tax
code so companies like ISO Poly Films can invest more in their people
and their products.
Tax rates have consequences. The liberals myopically ignore the
realities of human nature. They think in raising rates they will raise
revenue. But they don’t understand large employers have choices, as do
wealthy individuals, and that includes moving money off-shore. When
they try to take too much, they end up hurting the very people they
seek to help: the working class.
We need tax policy that embraces the world as it is, and not what
liberal ideologues wish it to be.
The goal of my cut, balance and grow plan is to unleash job creation to
address the current economic crisis, while generating a stable source
of revenue to address our record deficit and put our fiscal house in
order.
My plan should not be viewed in a vacuum, but in comparison to the
continuation of the status quo. It provides employers and investors
certainty, which is critical to getting capital back into the economy.
The president’s plan provides temporary tax relief, which does nothing
to encourage long-term investment because it doesn’t provide the
private sector certainty.
The way to stimulate the economy is not through temporary tax relief or
government spending; it is to stimulate private spending through
permanent tax relief.
The flat tax will unleash growth. But growth is not enough. We must put
a stop to the entitlement culture that risks the financial solvency of
this country for future generations.
The red flags are alarming. Our children are born into $46,000 of
federal debt. Our credit was downgraded for the first time this past
August, in part because of a lack of seriousness about deficit
reduction. According to the White House Office of Management and
Budget, by year’s end our debt will exceed the size of America’s
economy for the first time in 65 years. We are on the road to ruin
paved by state serfdom.
Freeing our children from financial disaster requires the courage to
reform entitlements. My plan establishes firm principles to preserve
Medicare and Social Security for today’s beneficiaries, while saving it
for tomorrow’s.
I am putting forward five principles to save Social Security for the
long-term. First, we will protect existing benefits for current
retirees, and work with Congress on the exact age where those nearing
retirement are grandfathered out of changes to the program.
Second, we will end the current pillaging of the Social Security Trust
Fund by Washington politicians. Here is the hard truth: the trust fund
is full of IOU’s, without a single dime of money left over from what
workers have paid in. The politicians have borrowed against it for
years. And in order to redeem the IOU’s in the fund, they will have to
either raise taxes or cut spending on other programs to replenish it.
Here is the other hard truth: if we don’t act, in 25 years benefits
will be slashed 23 percent overnight. Protecting Social Security
benefits begins with protecting the solvency of the fund, and stopping
all current borrowing from the fund, just as we have done with the
highway trust fund.
The third principle of reform is to allow young workers to invest a
portion of their payroll taxes into private accounts if they so choose.
I am not naïve. I know this idea will be attacked. But a couple of
facts are worth stating: one, the return on investment in Social
Security is so small it is like an interest bearing savings account.
Over the long-term, the markets generate a much higher yield.
Second, opposition to this simple measure is based on a simple
supposition: that the people are not smart enough to look out for
themselves. The liberals think the American people cannot be trusted to
safeguard even a portion of their own retirement dollars. It is time to
end the nanny state and empower our people to exercise greater control
over their money.
The fourth principle is to return to pre-1983 law and allow state and
local governments to newly opt out of Social Security and instead allow
their employees to pay solely into state or locally run retirement
programs. This has been done around the country, with better results.
We ought to allow it again.
Lastly, we ought to work to
raise the retirement age for younger workers – on a gradual basis – to
reflect the longer life-span of today’s Americans. I will work with
Congress to determine the right formula, beginning at the right age.
But this is common sense, and it can help save Social Security for
future generations.
We will also reform Medicare to save it for future generations of
Americans. We will do this by working with Congress on several
options, including giving patients greater flexibility in choosing the
plan that best fits their unique needs through bundled premium support
payments to the individual, or as a credit against purchase of health
insurance.
Second, we should look at gradually raising the age of Medicare
eligibility. Third, we should consider adjusting Medicare benefits to
be paid on a sliding scale based on the income of the recipient. And
lastly, we must tackle the $100 billion in annual waste and fraud to
save this valuable program as Americans live longer.
My plan also restructures Medicaid, returning control over the program
and the dollars needed to administer it to states. One-size-fits-all
health care doesn’t work for people on private plans in the form of
Obamacare, and it doesn’t work with public plans, such as Medicaid.
Washington has broken it, and shown no will to fix it. We must give
state leaders the flexibility to fix Medicaid and control its costs.
These reforms are essential to balancing the budget. My plan balances
the budget as fast as any serious plan offered, in the year 2020, with
reforms to entitlements, with greater economic growth, and with cuts to
discretionary spending.
I do not take the tack of the current President, with arbitrary cuts to
defense spending. The question we must ask is not what we can afford to
spend on our national defense, but what does it cost to keep America
secure.
At the same time, we will reform the way we spend money in Washington
so we can balance the budget in eight years. But to truly protect
taxpayers, we need the extra protection of a Balanced Budget Amendment
to the United States Constitution.
I will reduce spending in the Department of Education, the Department
of Energy, the EPA, and a whole host of other agencies, returning
greater control to the states.
My plan reduces non-defense discretionary spending by $100 billion in
year one, and builds on those savings in the years to come.
I will also institute several principle reforms to the budgetary
process, which are contained in my Cut, Balance and Grow Plan on my
website.
It is not the length of a “War and Peace” novel, and is easy to
understand, yet bold in its approach.
Included in my budget reforms are elimination of baseline budgeting
that assumes previous expenditures are sacrosanct, an end to
non-emergency spending in emergency bills, and a permanent stop to
“bridge to nowhere” projects through the elimination of earmarks. I
will couple these budgetary reforms with an overhaul of the regulatory
process.
When federal agencies like the NLRB are dictating to companies where
they can create jobs and where they cannot, they have over-stepped
their bounds and undermined our free market system. On my first day in
office, I will freeze all pending federal regulations and immediately
begin a review of all new regulations since January of 2008.
Today the Federal Register contains 165,000 pages. The index alone is
eleven hundred pages long. And somehow, despite not having any of these
new regulations for our first 219 years, America not only survived, we
thrived.
The federal nanny state’s heavy-handed regulations are keeping our
economy in the ditch. It is time to review and scrap regulations that
harm jobs and growth.
Lastly, one of the greatest impediments to investment in America are
the Dodd-Frank banking regulations, and I will lead the charge to
eliminate them.
Dodd-Frank is killing small banks, and freezing access to credit just
when small businesses need it most. It enshrines bailouts and the
notion of “too big to fail” in federal law, benefitting Wall Street
while killing Main Street. It’s wrong. It’s unfair. It must go.
My plan does not trim around the edges. And it does not bow down to the
established interests. But it is the kind of bold reform needed to jolt
this economy out of its doldrums, and renew American prosperity. Those
who oppose it will wrap themselves in the cloak of the status quo.
America is under a crushing burden of debt, and the president simply
offers larger deficits and the politics of class division. Others
simply offer microwaved plans with warmed-over reforms based on current
ingredients.
Americans, however, aren’t searching for a reshuffling of the status
quo, which simply empowers the entrenched interests. This is a change
election, and I offer a plan that changes the way Washington does
business.
The great issue facing this nation is whether we have the courage to
confront spending and the vision to get our economy growing again. We
need a tax code that unleashes growth instead of preventing it; that
promotes fairness, not class warfare; that sparks investment in America
instead of overseas interests.
It is time to create incentives for American companies to invest in
American workers. It is time to end the corporate loopholes, end the
special tax breaks for special interests, end the gravy train for
lobbyists and tax lawyers.
It is time to pass a tax that is flat and fair, that frees our
employers and our people to invest, grow and prosper.
We will set our employers and our people free by slashing the cost of
government, cutting taxes for middle class families, balancing our
budget and growing our economy.
The future of America is too important to be left to the Washington
politicians. To get America working again, we must cut taxes and
spending, balance the federal budget, and grow our economy and
jobs.
My plan unleashes American ingenuity for a new American Century.
Restores the hopes and dreams of our people. Renews our great promise.
And entrusts the fate of this nation into the hands of our People,
setting them free.
Thank you, God bless you, and God bless America.