Interview with Republican Presidential Candidate Steve Forbes

Listening to you talk about the flat tax on our and earlier it almost sounds like you're proposing this flat tax for all twisted motives. I'll do OK regardless of what the tax code is like in this country. But I want to do this to benefit other people can you explain that how what your motives really are. Well the key is how does America live up to her full potential. Why is it for example that two incomes in a family don't do the job that one income could in previous generations. One of the key obstacles is the tax code. Nobody understands that the tax collector doesn't understand that it has a corrosive impact on American life. Those high rates are a dead weight on families and on people having a chance to get ahead. So if you're running for president and want to be president the question people legitimately ask you is how can America live up to her full potential. And especially in the post-Cold War world I think we have to start with a tax code that will allow you to keep more of what you earn. That will remove the major source of pollution in politics. And I think that's the that's a good start. There are other things that have to be done but that's the place to start. So your main motive in pushing for

this is really to benefit others to benefit those less fortunate than yourself it's to remove an obstacle and a barrier to people realizing the American dream which is discovering and developing your God given talents in America. You're supposed to have a chance to get ahead. I don't I want to make the word opportunity a real word with the tax code we have today. It is a barrier. We should be doing far better in the economy today. We should be doing better and I think we will do better. OK. One thing that has been said about your particular 17 percent proposal is that it would result in a revenue shortfall. The estimates I've seen range anywhere from 40 to 200 billion dollars. What do you say about that is that so. And if so how do you make up for that shortfall. The my flat tax proposal is combined with a tax cut for a very basic reason. Everyone in Washington says a tax change should be revenue neutral. I say why. If something is good for America America should have it.

Washington should adjust to the needs of the nation rather than the nation having to adjust to the appetites of Washington. The first year shortfall would be $40 billion. I think in the real world it would be far less because you'd have growth and more compliance. Every time we reduce tax rates just remember taxes are not only means of collecting revenue. They are also a price. And when you lower the price on work productivity innovation success we do better revenues go up. Just one example. In the 1980s when tax rates were cut federal personal income tax revenues at the end of the decade were two hundred billion dollars higher than they were at the beginning of the decade. The problem was we had a Congress that couldn't say no to spending. I think we have a Congress now that can say no. So I think that this will get America moving and we will get Washington's finances back in order. Cynics or or critics would say this is the most radical proposal to cut government that you've seen it makes Newt Gingrich look like an incremental

list because if you have to cut that much in order to make up for that shortfall you're talking something that would drastically change what government Washington spends. These numbers get big and it's hard to comprehend. One and a half at least one and half trillion dollars a year. The tax cut I'm talking about assuming no good comes from it is a tax cut of 40 billion dollars a year. That's about what two cents to two cents on the dollar if that. So it's I'm not talking about a big change in terms of Washington more over it and I don't understand why the Democrats can't understand this when you lower barriers to people getting ahead. Government revenues go up. They went up in the 60s when John Kennedy put in his tax cuts they went up in the 80s with the Reagan tax cuts. You've seen it on state levels. When you reduce barriers to people's chances to get ahead. Government benefits. Now I'm going to use those extra revenues not only to reduce the deficit but also to reduce taxes further. But there will be increased revenues not because of higher taxes but because the American

people have a chance to do more be more productive be more innovative. Which has been our history for 200 years. So you are going to prove supply side economics right. I'm going to prove that America's traditions of allowing people the chance to get ahead still as operative in this world. I think we're going to astound ourselves and the world with our achievements and opportunities when we make some of these changes. A lot of the solutions you're proposing to issues like health care welfare education rely on individual responsibility school vouchers medical IRAs IRAs for retirement. That kind of thing some folks would say well that works very well if you've got the means to put your own resources towards those things. But what about people who are less advantaged for people who are less advantaged. My program my principals are going to be a godsend. If you want to have a chance to get ahead for example your child has to get an education. And many of the school districts in America that's not true. I believe that those school districts will be forced to reform when parents are in charge. Parents have control like they used to have in the public school system in

terms of job opportunities. You don't have job opportunities when the economy is stagnant with vibrant growing economy. You have a chance to get those jobs in terms of Social Security. Younger people now know that the system's not going to be there when they retire because of what the politicians have done to it. So while we must keep our promises to current beneficiaries and those are about to retire I think we need to put in while we still have time a new system for younger people. So there will be something there for them when they retire. So that portion a portion of their payroll tax that now goes to Washington would go instead into their own individual savings or retirement account. They're already paying the money this way. There's something there for them when they retire. So for people who want to get ahead who want safer streets better jobs better schools. I think I have the approach which is very very much a part of the American tradition. OK. Laura. At the beginning of her show called you the surprise candidate on referring to you were consistent second place showing in polls in both

New Hampshire and Iowa what counts for your surge upward as coming in as somebody who had no elective experience. I think it's the power of the message of both hope and opportunity. People weren't feeling they're getting that message from the other candidates. People do want a serious discussion of these serious issues on providing it. My ads are not full of fluff and puff. They're talking about serious issues in specific ways and people appreciate that. And that's why I think I've attracted the support I have so far. It's also quite fair to say that if you didn't have the money to finance your campaign you could have a wonderful message but nobody would be hearing it. Well I have spent less money in this campaign than either Senator Graham or Senator Dole or even up to now Senator of Governor Alexander. The reason that I've done as well as I have is that I have a message to give to the voters. They've been running messages. They've been walking the state. They've been handing out literature but people haven't found what they're looking for and what they've done. Moreover they've spent their money quite frivolous ways. For

example in Florida for a straw poll of party regulars with non-binding Dole spent $2 billion. Alexander and Graham each spent one million dollars. If they can do that to contributors money these so-called fiscal conservatives imagine what they're going to do with taxpayers money. I'm getting value for the money. Moreover unlike them I want to make this point I'm not taking a penny of taxpayers money. They are all getting they're all getting federal subsidies. I'm not taking a penny of federal subsidies. Well it brings up a couple of things. Just like is it fair or right for you not to have to play by the same rules as other candidates do. I'm talking about campaign spending limits and not having to meet these restrictions to get federal matching funds. You're sort of exempt from the restrictions that other candidates have to follow the rules the rules are written by insiders for insiders for people who spend a lifetime in politics. Senator Graham Senator Dole and others have been on the public payroll for 20

30 years at the taxpayer's expense. They've been doing massive mailings at taxpayers expense. If an outsiders to break in. That's the only way to break in. I want that support. One reason why I want term limits I want to open up the system to citizens. The rules are written for insiders and that the insiders have the answers. They would have implemented them by now. And that's why they're also getting these federal subsidies. That's rat's hand written for insiders. Well no one's going to say that the current system is the ideal. I don't think he'd have too many people overtly defending it anyway. Then the only way you are going to change it is with an outsider. OK. Insiders aren't going to change it. They would have done it by now. But an outsider only like yourself only somebody who's a billionaire is that is that is that a good dynamic that only somebody with your resources can break in as you say. Well I think that's why I want to open up the system starting by changing the tax code starting by putting in term limits so you don't have to spend a lifetime in politics to a chief of a degree of effectiveness in politics. So I say the rules are written on the assumption you're going to

spend a lifetime being a politician. I want to have more citizen involvement. I can make the change to open up the system. The insiders are not going to do it because they don't want outsiders getting involved. Moreover I make one other point. At the end of the day at the end of the day people are less interested in the size of your bank account or what your parents balance sheet was and they are. Does this person understand what the barriers are in America what the opportunities are for America if these obstacles are removed and then they want to know is does this person have the internal strength character sense of direction compass to see the changes through against the culture of Washington. So I said earlier one of the frustrations in America today is the feeling that too many public officials practice what you might call the political equivalent of painting by the numbers. It's not art and it's not leadership. And people do want a serious discussion of real issues. OK. You didn't mention candidates walking across the stage. A reference to Governor

Alexander For one some observers of your New Hampshire campaign said this isn't the traditional way we do things. This campaign is relying heavily on ads and not so much on retail politics and it's sort of bypassing the traditional New Hampshire one on one process that we come to think of is as healthy especially when you compare what happens on the national level. The fact I'm here on this snowy day I think the answers that I've been in New Hampshire quite a few days I'll be here many many times between now and the primary on February 20th. And the messages that I've had have been about specific issues specific content and that's why I think people are interested in this candidacy and they will have plenty of opportunity through this means and others to have interaction with me. You talked about some of the pro-people they talked about it earlier. I had an hour and a half meeting with United we stand a few days ago. So I am doing it on the retail level but I have issues and I think that's why people are getting excited about my candidacy. Just a couple more of them. We don't ask what you've learned from operating on the retail level from you know

the ordinary folks that you claim to be you know communicating with. Well the only way you win in a democracy is by taking a message directly to the voters having an genuine interaction with the voters. And I think that's why I've made the progress I've made of one of the exciting things about being talking to people is one you can see in flesh and blood the frustrations the concerns things pieties about where America is going why we seem to have gone off track why the quality of life seems to have been under assault for 30 years. But also underneath that while they may be frustrated angry worried about where we're going to go there's also a very deep optimism and faith that if we make certain changes we can get our country back on track again. Keep talking about where we're going to go. You talked about the Republican Party during the call in show even if you don't get the nomination or don't get an offer to be the candidate on the ticket how

would you like to see this election in terms of where the Republican Party is going to go. And in a larger sense where the country might go. Well since I'm going to win the nomination I wouldn't be in the race. I think the question in that sense is operative. But I do think that we can get the Republican Party and the direction of growth opportunity of hope of closeness of removing the obstacles that stand in the way of achieving our full potential. What needs to be redeemed though in the party where has it gone awry and where would you like to push it toward. Well part of the party has been stuck in the Washington culture. You see that in parts of the Senate where they have a hard time even passing a straight line tax cut. They've got it many other reforms like reforming our convoluted corrupt legal system. And so I think that that's part of the party needs to be brought up to be brought up to speed brought into the 21st century. And I think in 96 the voters are going to do that. They're going to get the party in a pro-growth pro opportunity direction would it be fair to say then that you'd like to steer the party more in in terms of getting back to its original economic message of

freeing up the economy promoting growth and less on the hot button issues like abortion and school prayer. That is a fair assessment. I've said that in my mind values and economics are one and the same and that you're going to see I think America has the potential for the greatest economic boom and spiritual renewal. And if we move some of these barriers allow people more control over their lives they will take matters in their own hands as we've done with reform movements in the past and improve the quality of life in America while also making it possible for more people to have a chance to get ahead. That's what excites me about 96. OK last question I saw for you tell me more about the fact that my question about your not being the nominee was inoperative you feel confident about this. Tell me about your strategy and why the strategy is very simple. I'm taking my message directly to the voters. They will ultimately do the hiring and firing into democracy. They'll judge the message and the messenger. I think I've gotten a good message and that's why I think I can go all the way. In 96 perhaps the assets that I bring to

the table would not have been what we needed 10 years ago may not be what we need 10 years from now. But at this point in our history I think that I have a better understanding than my competitors of where America's at and where America can go. And I think that's why I'm going to go all the way in 96 Bob Dole Bob Dole. I look forward to working with him this when he's a majority leader in the Senate. He's a superb legislative tactician and I think he'll play a critical role in passing this program in 1997. How are you going to overtake him simply by appealing to the voters. They make the decision not press not pressure groups not pundits not politicos the people do it in the primaries. And that's where I'm making my appeal. Thanks a lot. Thank you.