GOP Economy: Jon Huntsman's economic plan
Home state: Utah (Born in Palo Alto, Calif.)
Economic platform: Former Utah Gov. Jon Huntsman wants to reboot the American economy by eliminating every last tax loophole, lowering the corporate tax rate, and switching from six income tax brackets to three. He says simplifying the tax code will bring certainty to the market. And he argues that will spur business to create jobs and attract new investment. Huntsman's plan draws heavily on House Budget Committee Chairman Paul Ryan’s “Path to Prosperity,” the Simpson-Bowles deficit commission report and T. Boone Pickens’s proposal for energy independence.
Huntsman wants to lower the marginal corporate tax rate from 35 percent to 25 percent. He would replace the current six income tax brackets spanning from 10 percent to 35 percent with just three brackets of 8, 14 and 23 percent. The shift to lower rates would be revenue neutral, Huntsman says, because subsidies, loopholes and deductions, including several that benefit middle-class taxpayers, would be phased out. He would end the capital gains tax, a change that mostly benefits the wealthiest Americans. He supports killing the alternative minimum tax -- which was originally intended to ensure wealthy taxpayers couldn't use too many tax breaks to avoid their fair share in taxes.
Roger Noll, a professor emeritus of economics at Stanford University, said Congress has blocked every president for the past 40 years from achieving a simpler tax code because lawmakers on both sides refuse to drop breaks for certain constituencies. “Advocating for a flatter and broader tax is like being in favor of motherhood and apple pie. It doesn't have very much significance,” Noll said.
Like each of the other major Republican presidential candidates, Huntsman also supports repealing new rules affecting health care, Wall Street and the environment. Many commentators have labeled Huntsman a moderate in the Republican field because of his belief in climate change, support for college tuition breaks for illegal immigrants and his work as President Barack Obama’s ambassador to China, among other things. While his economic plan leans conservative, some of his proposals frustrate conservative groups such as the Club for Growth.
Defense: Huntsman says he would bring back troops from Afghanistan as quickly as possible and then start to make the American military more agile. Part of his plan would involve reining in defense spending and committing to what Huntsman calls a “right-sizing” of U.S. foreign policy. Huntsman believes in maintaining strong ties with Israel and would not rule out using force against Iran. More broadly, he says reaching free-trade agreements with more Asian and South American countries will allow trade to play a larger role in foreign policy and boost the domestic economy. He says his his plan to dig into more American energy sources, from natural gas to Alaskan oil, will also help.
Education: While Huntsman has acknowledged the need for “dramatic” education reform, the issue appears to be less of priority for him. He believes change should come at the local level. Huntsman is not a fan of strong federal intervention in education. He supports vouchers that allow parents to choose to send their children to private schools. As governor, he increased state spending on schools, delivering pay hikes of more than $3,000 to teachers.
Housing: Though he introduced a plan in 2008 as governor that would make Utah’s housing authority something like Fannie Mae and Freddie Mac, he’s now castigating the federal housing giants for contributing to industry’s collapse. He has called for the privatization of both Fannie and Freddie and the scaling back of “homeownership subsidies,” such as the home mortgage-interest deduction. Huntsman has said the key to a booming housing market is steady immigration. He wants to reform and expand the H-1B visa program, which allows employers to bring highly skilled foreign workers to America.
Health care: Huntsman equates President Barack Obama’s health care overhaul to an act of terrorism, dubbing it a “$1 trillion bomb” in his economic plan and says he wants to see it repealed.
Social Security: Huntsman wants to restrict Social Security benefits to wealthier Americans. He also would tie the retirement age to the 85th percentile of life expectancy. According to the latest Centers for Disease Control figure, that would lower the current retirement age from 67 to 66.2. Finally, he would support a change in the cost-of-living increase formula that would result in lower monthly benefits for some recipients.
The National Debt: Huntsman finds the nation’s debt level unconstitutional and immoral. He wants to bring down government spending as a percentage of GDP from 23 percent, as the Obama administration expects to do between 2012 and 2021, to 19 percent. Obama’s approach, meanwhile, calls for tax hikes on the wealthiest Americans to bring revenues up to 20 percent of GDP.
Taxes: Huntsman originally criticized President Barack Obama’s stimulus plan as not being big enough. In 2009, he was quoted as saying a $1 trillion package might have been better than the $787 billion stimulus signed into law. Recently, Huntsman has said his vision of a bigger proposal involved more tax cuts and other tax changes similar to those he is proposing now. Like many other Republican candidates, he supports a tax holiday to bring back what he says would be $400 billion to $600 billion in corporate cash stashed abroad.