Mitch Daniels: "Keeping the Republic"
http://thedianerehmshow.org/shows/2011-09-26/mitch-daniels-keeping-republic
Mitch Daniels is serving his second term as governor of Indiana. Since he took office in 2005, he has gained national attention for putting Indiana's fiscal house in order. He is credited with turning a $700 million deficit into a billion-dollar surplus. Many of his supporters were disappointed when he decided not to run for president. The governor's detractors contend he's anti-union, anti-immigrant and has done little to help struggling families. In a new book, Daniels explains his policy decisions and how to restore prosperity to America. A conversation with Governor Mitch Daniels.
Guests
Governor Mitch Daniels
Republican governor of Indiana; he was director of the Office of Management and Budget under President George W. Bush; and was a senior aide to President Reagan.
Gov. Mitch Daniels Answers Audience Questions
Q: I've lived in Indiana for 10 years and moved to our particular town because of the wonderful school system. Under Mitch Daniels, we've seen funding for public education at all levels reduced every year. How can he boast about being fiscally responsible, when his cuts steal from our future by denying the best possible education for our young people? - From Robyn via Facebook
A: Robyn, those are simply not the facts. Spending on K-12 is far higher than when we arrived and has gone up every year except one, when virtually every state in the country was reducing it further than we did. It is rising again this year, plus we have resumed our drive to fund full day kindergarten for every 5 year-old.
As I said on the air, 56% of every Indiana state tax dollar goes to K-12, the highest percentage in state history and the highest in America.
That said, more money has not led to better results, in Indiana or anywhere else. Since you obviously care about the academic achievement of our kids, please be a vocal supporter of the reforms we have passed this year. They are the kinds of actions that people from President Obama to me agree on.
Q: You've been a supporter of investing in infrastructure. What do you think of President Obama's infrastructure plan in the "American Jobs Act?"
Q: I live in Indiana. Daniels sold off our state's assets and told us we had a surplus of money that we can use for a rainy day. Our unemployment is higher than I've ever seen in my lifetime. Could you please ask him what he meant by a "rainy day?" Thank you.
- From Cheryl via Facebook
A: Rebuilding America's infrastructure should be another goal on which people who otherwise disagree should come together. I think there is a far better route than the old-school, centrally-driven approach the President just proposed. The two keys are to welcome rather than spurn private capital as part of the solution, and to jettison as much of the ponderous and redundant federal regulatory rulebook as possible, so that projects don't take years just to get started.
Cheryl asks indirectly about this subject. She incorrectly says we "sold off state assets." In fact, we sold nothing, but through converting our Toll Road, which we continue to own, to a tightly regulated public utility, we harvested billions of dollars which we are reinvesting in a record infrastructure building program. None of these dollars – zero – went to our rainy day funds. Those funds, which were below empty when we arrived, have been rebuilt to a reasonable surplus. We used them during the recent downturn to avoid the huge cuts to public education, Medicaid, and other services that happened in almost every other state.
Read an Excerpt
Excerpted from "Keeping the Republic: Saving America by Trusting Americans" by Mitch Daniels by arrangement with Sentinel, a member of Penguin Group (USA), Inc., Copyright (c) Mitch Daniels, 2011:
Comments
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Mitch Daniels is a lightning rod for good reason. His dismantling of Indiana public education is one way he "tackled" the budget. Caps on property taxes is another. Apparently he is blissfully or purposely unaware of all the budgetary problems in California that have come about since they capped their property taxes in 1978. Busting unions and telling teachers they are overpaid is no way to run a government, Mr. Daniels. If those teachers are overpaid simply because they make 22% more than the average Hoosier, how much more are YOU overpaid since you make roughly 300% more than the average Hoosier?
No hoosier7
Jarvis and his bunch in California in 1978 were doing the right thing in capping property taxes. Retirees were losing their homes back then because of the high property taxes in California. The fear was brought on by unions that property tax limits were going to hurt everybody. It didn't. From memory I think TIME JUNE 1978 did a story on this.
Teachers pay has come along way in the last decade so stop complaining.
During the last four decades some of the largest American Corporations supported political candidates who voted for changes to the tax code giving them tax breaks for sending manufacturing, Information Technology, and Customer Service jobs to other countries. They also supported tax code changes that allowed the highest earners to be compensated with 'investment income' taxed at 15% & lower the tax rates for the top 1% of American with the rationale that these tax changes would result in job creation. The opposite has happened. There was also a Public Relations campaign against unions with the logic that they were the primary factor for American jobs being sent to other countries & that teachers and other public sector workers are overpaid and America can't afford their salaries, benefits, and pensions.
My question is the following: Over the last decade, our actual tax rate (not the ones before tax exemptions are taken into consideration) is the lowest in almost a century and we have not seen the 'job creation' touted by the conservatives and libertarians. Taking into consideration the changes to the tax code that encouraged and rewarded companies to send jobs overseas; a corporate culture that enabled top executives to negotiate compensation packages that are taxed at 15% & to engage in short-term risky business/financial behavior; and zero job growth after the Bush Tax Cuts, how can the Governor and his party continue to defend these tax policies?
Decades of social science and medical research shows a definitive correlation between affordable & geographically access to family planning services and reduced unwanted pregnancies. There is a direct correlation between reduced access to family planning services and increased number of premature births & higher infant/maternal mortality rates. Planned Parenthood provides women with affordable access to annual examinations for cancer & other treatable health problems; access to contraceptive counseling and services to prevent unwanted pregnancies & to allow women to plan their families; and diagnosis & treatment of sexually transmitted diseases. For millions of American women, Planned Parenthood has been their primary health care provider. At a time when over 50% of American can not afford medical insurance, why did the Governor abolish funding to an effective health care provider & a primary health care provider for tens of thousands of Indiana women? I don't want to hear 'they are abortion providers' because only 3% of Planned Parenthood funds go to abortion care and NO TAX monies are allowed to fund abortions. How can you say that you trust Americans to make the right decisions yet you deny 1/2 of the population access to a medical provider that provided them birth control methods to plan their families and medical care. This appears to be the opposite of trusting Americans.
How can the Governor and GOP say that stimulus programs don't yield economic growth? There is ample historical evidence that stimulus programs and higher taxation create jobs such as the largest stimulus program, WWII, and the 1950s National Infrastructure project. Yet, the GOP, conservatives and libertarian continue to say that the government do not create jobs and that government is anti-business. Without a stable government programs i.e. judiciary, transportation systems, public health system including water & sewer treatment systems, military, social services, health, Preschool through University education system, police & firefighters, port authorities, and too many effective programs that enable our country to remain a competitive and safe place to conduct business. Government workers and programs are a key component to our nation's success and shouldn't the head of the Indiana government recognize and acknowledge their role in our nation's current and future success?
People believe that FDR was this great president that saved the US from disaster. However during his first 8 yrs there were no jobs created other than those temporary make work jobs. FDR was anti private business and private business suffered. Those billions of dollars pumped by the FDR Administration did nothing to stimulate the economy. It was the war that created job and saved FDR from his dismissal job creation.
Now 80 yrs later and 900 Billion being pumped in the US by the
Recovery Act and still job creation is non-existant. The US is something like 5 million lost jobs since January 2009 and still another proposal to spend another 340 Billion.
The US had balanced budgets before George Bush and Mitch Daniels arrived in 2001. As Director of the OMB, Mitch Daniels predicted the war in Iraq would cost only $50 Billion under cutting Lawrence Lindsey's also inaccurate estimate of $100 to $200 Billion. Tax cuts urged by Daniels and others in that administration turned a $236 B surplus into a $400 B deficit. Daniels as Governor championed a very expensive computerization of the welfare system with IBM that failed and now is costing Hoosiers million in court to defend his breaking the contract. If we allow people like him to constantly rewrite history with their dis-proven classical economic philosophy, we have no reason for hope in America. He is just a new and improved model of those who opposed the Keynesian policies that were proven by the government spending that won WWII and conquered the Depression.
macdorset wrote:
"The US had balanced budgets before George Bush and Mitch Daniels arrived in 2001"
Thank you for giving credit to Ross Perot, without him this would not have been possible. Coupled with a president desperate for reelection and a republican congress seeking acceptance, the people demanded fiscal responsibility and they got it!
When it comes to rewriting history, your doing it!
ecarter, you are a supporter of big government, OK. There are places in nature where a parasite assists the host to survive and prosper. But, can you give me one example when the parasite known as government throughout history has done anything other than kill it's host the private sector and the well being of the people with know it all disastrous solutions..
Exactly what part of the federal government borrowing 40 cents of every dollar spent do you not understand?
The most frightening thing to a big government liberal democrat is evidence that a small government idea can work.
Shrieks of failure are cried against new state administrations not even given a few months to see any results. Yet we are supposed to wait for two terms of Obama for utopia to arrive from those very same people!.
The biggest exporter of jobs is the American consumer. Choices made everyday by people who want to soak the rich and blame corporations for exporting jobs send their money overseas with their purchases and think nothing about it, hypocrites.
My sister-in-law was critically ill in New York so we had her medically transferred to Indiana as we live in southwest Michigan. She was first in a hospital and than in a nursing home in Indiana. She was very ill and was on Medicare - she only lived 6 months after her transfer. Because she was considered a resident of Indiana, we had to pay 7% inheritance tax on all her assets including a 600,000 dollar retirement program she had set up. Actually two of her siblings had to pay 10% because they were left more from her retirement program. None of her siblings live in Indiana and if she had been considered a resident of NY or Michigan there would be no inheritance tax.
This seems like a very steep tax for people who don't live in Indiana. Governor Daniels talks a big talk about taxes but this hidden tax is there and extremely unfair for people like us. While Betty was alive in Indiana, she utilized no infrastructure or state assistance. She only spent money in Indiana on nursing home care - out of her own pocket - helping to provide jobs to people. This is an outrage and I wish you would ask Governor Daniels about this extremely unfair tax.
Don't forget to ask him about why he signed a law requiring physicians to read a statement to their pregnant patients even though a senate amendment requiring the statement be factual was voted down and how that squares with a smaller government and getting it off the backs of citizens.
Also, the state's budget was balanced by selling (they'll say leasing, but for federal tax purposes it would be called a sale) the toll road across northern Indiana. In my mind, selling assets is not actually balancing the budget but merely converting hard assets to cash as the "net worth" of the state has decreased by that amount. You can only sell so many assets before you're bankrupt.
Oh boy-
His opening statement gives us the same old BS. "I'm in favor of freedom of choice and government getting out of the way except for pregnant women and poor people."
Once again we hear a Republicam blaming the 2009 economy on Obama when the results of any decisions he made wouldn't show up until 2010.
Please ask the Governor why it is or isn't a good idea for the federal government to be forced to live within the same "balanced budget" condition that applies to state governments. Is there a discipline or dose of reality that comes with this restriction that might benefit the federal government?
Governor Daniels is precisely the type of individual we need in our political sphere. His ego doesn't need stoking, he thinks like a businessman and he plays a public role not because he wants to, but because he believes the job needs to be done and others aren't up to the task. He has served Indiana well. I appreciate his concern for his family, but I'm also sad that he stepped away from possible presidential candidacy. Clearly, though, he has ideas of other ways he can shape the conversation and his concepts merit consideration. Thank you, Diane, for featuring him today.
@ meanconser
Interesting that you should bring up Howard Jarvis and the Proposition 13 property tax cap in California. California's education system up to that time had been the envy not only of the nation but of the world; now it ranks among the most dysfunctional in the nation. You cite a 1978 TIME article to claim it didn't hurt. It didn't exactly have time to bite so soon but I find the evidence of a 33-year-long decline quite convincing.
Endemic Dadaism is at work destroying American institutions and the middle class.
The simple fact is that the repeal of Glass Steagal, the wars of choice of the Bush administration, and the unpaid for tax cuts created a tipping point. These decisions had long term consequences for the U.S. and the world economy. Mr. Daniels seems to have retreated to the Republican "talking points". They will not solve the basic problems affecting the world economy. Debt is not the immediate problem. The immediate problem is how to address the dislocations created by the shift of manufacturing to the Far East.
We've had the lowest effective corporate taxes and taxes on so-called "job creators" ever--and the highest unemployment and inequality we've had in generations. Growth doesn't come from lowering taxes; it comes from increased demand and spending. And if the middle-class is shrinking, they will not be able to spend or buy goods. You can't have a healthy economy with the kind of economic inequality we now have. All this talk about decreasing taxes on the wealthy is just a thinly veiled excuse to keep money and power concentrated at the top.
I am 59 yr.-old female whose mother was deathly afraid of debt and vividly remembered the Great Depression. When we were in the 4th grade in 1962, the teacher looked at all 42 of us in the classroom, and said, there will NOT be enough for you when you reach retirement. You had better plan for yourselves.
Do not send me any social security. I am not in need of that welfare plan. Let the needy people have it. I am a lifelong Democrat by the way.
This governor is as out of touch as the party he represents. The plutocracy he protects is unsustainable. He can't even use accurate language that is accurate or neutral during this interview. How dumb does he think we are? Even Warren Buffet who seems to know about how to run a business wants the rich to pay their fair share of taxes. Mitch is articulate and corrupt. He should be ashamed of himself.
Since republicans won't allow the cuts that had a sunset to actually go away, what makes the governor think that they will allow any changes to the tax code that gives advantage to the ones who have more than they need while keeping the lower waged individuals at a disadvantage? Also, I am sure that he would not be willing to give up or lower the rate of the state funded pension that he will receive because it costs his state too much, while wanting to deprive teachers of their hard fought and hard earned pension. Republicans talk out of both sides of their faces. What they say always means something other than face value.
It's misleading and mean to refer to Soc Sec as a Ponzi scheme, particularly when that term is associated with a known crook like Bernie Madoff. It's a pension plan, simply. Some people used to think that the banks held their exact dollar bills. The fact that the banks lend out your money, and in return, guarantee its safety and give a small amount of interest for their opportunity to invest your dollars....that's not misleading. Dollars are fungible.
Daniels job is to put a happy face on the decimation of the middle class in this country. Him and his party are hanging out the American public to dry, and calling it "Freedom to Choose", and "Getting government off our backs".
Yea freedom to be hungry, homeless, and sick in this country. Look at how far we have fallen from Roosevelts freedom from want and fear.
Governor, do you think the government should cut funding for items like Public Radio? If so, how come you don't suggest such cuts are too small to make a difference but then use the "too small to have an impact" argument when talking about deleting tax breaks on those paying a tax percentage less than the rest of us?
By the way, those tax breaks are the high income earner's entitlement programs. There is no different between giving an entitlement to someone poor via a check or safety net program and giving a entitlement to the rich via a tax break.
To call them by different names is bizarre and quite frankly insincere.
P.S. In my church, my pastor never complains that the rich are paying a bigger portion of the church budget compared to those earning less. They look at the percentage as a gauge of understanding of their spiritual walk with trusting God with their finances.
Why did the Republicans during George Bush's administration not even realize that we had a budget, by keeping 2 WARS off the books and giving welfare to the top 5% with tax breaks.
Why on earth are you people even listening to this man. I refused to tune in this morning. This is a man who claims that the wars in Iraq and Ahfganistan are not contributing to the debt!
We've spent more than $1 trillion in Iraq, not counting the $700 billion consumed each year by the Pentagon budget. And spending in Iraq and Afghanistan now comes to more than $3 billion weekly, making the wars a major reason for record-level budget deficits.
Two years ago, Joseph Stiglitz and I published The Three Trillion Dollar War in which we estimated that the budgetary and economic costs of the war would reach $3 trillion.
New figures now indicate that those estimate were far too conservative—the cost of the wars will reach between $4 trillion and $6 trillion!
Daniels is considered to be some kind of sage? Give me a break.
Why is Social Security discussed in the context of our budget problems or the National Debt? It should be viewed as a standalone program, which, as Diane says, can be fixed by changes within the program itself. Do means testing or extend payments to 12 months and keep Congress' hands out of the trust fund.
Mr. Daniels talks about means testing for Medicare but why does he think it is okay to make weathy older people pay for their own insurance but not tax them at a higher rate? What is the big difference? Either have them pay taxes or insurance fees - I believe that it is because he has an intent to do away with Medicare and the first step is to created a two tiered system. If we raised the taxes of the wealthy to offset their Medicare costs, they would still have Medicare.
Again though for someone who wants to protect people's money and future, a regressive inheritance tax doesn't make sense. There is no means testing for that tax. The Federal government does not require income taxes on inheritated retirement funds if it is kept in a retirement fund - this helps people with retirement. In Indiana, the state inheritance taxes even retirement funds - thus, Indiana is not helpful in helping people with their retirements - yet Governor Daniels wants to reduce our Medicare benefits. Tax us through inheritance tax and then take away our Medicare benefit. This is how Mr. Daniel believes it is fair and balanced?
Governor just said disaster aid should be offset by cuts elswhere. Why then was the cost of two wars while he was budget director deferred for payment later by borrowing?