What’s the right balance of taxes, spending and debt?
The right balance of taxes and spending would produce deficits of about 2 percent across the long term. Under my economic policies, I believe the economy can consistently grow at least 2.5 percent per year, and if we can manage long-term annual deficits to be less than the level of annual economic growth, then the debt as a percentage of our economy will go down, which is what matters. The key metric is debt as a percentage of gross domestic product, and I would like to start slowly lowering that ratio to be more in line with historical averages. To achieve this, we need to increase revenue, which I would do by: (1) implementing a form of the “Buffet rule,” which involves synchronizing capital gains tax rates with ordinary income tax rates. We do not need a lower capital gains rate; that is an outdated incentive and contributes meaningfully to the structural unfairness in the tax code as investors pay lower taxes than workers, (2) by rolling back the tax cuts on high earners from the GOP tax reform, and (3) by raising corporate tax rates — not to where they were — but to about 27 percent. On the spending side, we have to lower long-term spending growth, which should be focused on fixing health care. Health care is the main long-term driver of our spending problems, and I have proposed a fully paid-for universal health-care plan that can do this (after we fix the Affordable Care Act!). We also have to address Social Security. [Republican Rep.] Tom Cole and I have introduced a commission bill (similar to the Greenspan Commission) to address the long-term solvency of Social Security.
If the Trans-Pacific Partnership and other trade deals have economic and geopolitical benefits, what do you say to workers who are displaced?
I tell workers that we have let them down by failing to respond to globalization and technology, which have been enormously positive for society and the world but not for many of them. As my dad the union electrician used to say, “a good job is everything.” I want to keep positioning the United States to compete globally with deals like TPP, but I will not forget about workers that are hurt by globalization. My approach is to think globally and invest locally. I would pair trade deals with domestic economic programs like infrastructure and with an agenda for turning around distressed communities. I was a leader on the “Opportunity Zone” legislation in the House, which created a federal tax incentive for investors to invest in Opportunity Zones. I would pair that with an incentive for government contractors to locate in Opportunity Zones, building more infrastructure in them and increasing the earned-income tax credit (which should be the center of our tax policy). We also need an agenda to address changes in work driven by artificial intelligence and automation. This involves changes in public education, creating ongoing training capabilities and developing creative compensation structures for jobs that are currently being done in society (like caregivers) that add meaningful societal value but are not currently compensated. Working together, these polices would cause investment capital and jobs to flow to communities left behind and help workers prepare for change.
Facebook and other tech companies have become the equivalent of utilities, yet they are essentially unregulated. How should we regulate them to address problems such as privacy and foreign interference in elections?
We should pass federal privacy legislation similar to what California passed. We should require full disclosure of who buys campaign ads on digital platforms. As part of a national AI strategy, we should address tech addiction and programming bias. We should harness the best in innovation but also protect our citizens. My wife [April] is the Washington director of Common Sense Media and is a leader in these areas.
Big companies engage in bidding wars to open or expand facilities in exchange for tax and other incentives. What problems do you have with this, and does it perpetuate inequality?
This practice does not help net U.S. job growth, it is a race to the bottom and it is effectively a form of corporate subsidies, many of which (but not all) have proved to have very low returns on investment relative to other investments. For example, I found the Amazon process unseemly, but at the same time I believe New York City made a mistake rejecting them. It is my sense that the package NYC offered was justified based on the assurances Amazon provided. The dynamic exists for these “auctions” because so many areas are hungry for economic development. Last year 80 percent of venture capital funding went to 50 counties in the United States. This has created massive inequality of opportunity and is turning the country into a nation of birthright instead of a country of opportunity. We need real polices that foster broader economic development so that fewer locations show up with bids the next time a corporation wants to run a national auction. [Amazon founder and chief executive Jeffrey P. Bezos owns The Post.]
What’s your solution to skyrocketing college tuition costs and student debt?
Post-high school graduation, every American should be able to attend community college or obtain career and technical training at no cost. The eligible programs should meet quality and graduation metrics in order to qualify. We should also have more creative loan repayment programs tied to income and work to lower the payments on student loans. Working together, this would allow a student to obtain two years of college at no cost and then finish the last two years at a lower cost. I have also called for a national service program that gives all high school graduates the opportunity (but not the obligation) to serve their country, either in the military, by doing community service, or through a new “infrastructure” program to rebuild parks and federal assets. In addition to all the unifying benefits and skill building associated with this, we could provide discounted student loans to students who serve, which would create another avenue for lower college costs.
As a preliminary matter, Delaney should get credit for direct, substantive answers, especially on the debt. He’s the first Democrat who’s answered these questions to specify how much debt we can carry and to address reform of Social Security.
On trade, Delaney seems to have hit upon an economically and politically viable solution: open up foreign markets and use domestic legislation, not tariffs, to address the adverse effect on American workers. He and other Democrats should also be forthright about the availability of the World Trade Organization to address foreign unfair competition. If that body needs reform, we should push forward so countries have viable remedies and need not resort to unwinnable trade wars.
Delaney makes a smart point about the concentration of venture capital in relatively few places. We’d like to hear him expound more on the trail about what to do about this. It’s the chicken-or-egg problem: Without investment and the promise of good jobs, it’s hard to set up a world-class university or make huge expenditures in infrastructure, which are needed to attract investment. We’d like to see candidates address an unpopular but perhaps necessary solution, namely moving people from distressed areas to where the high-tech jobs are instead of moving the high-tech jobs to distressed areas.
On education, Delaney and other candidates rightly stress alternatives to four-year schools. However, four-year college tuition even at public schools has skyrocketed, to the dismay of middle-class families. It would be interesting to see if college presidents were treated like oil company executives — hauled before Congress to explain the price gouging and whether there is any price fixing going on. Moreover, should uber-expensive universities with billions in endowment money get to keep their nonprofit status, especially if they continue charging students ungodly amounts for a diploma? No there’s a way to raise revenue — or pressure universities to start lowering their prices.