Grover Norquist HARDtalk

offer from there were -- their employers.

Time for HARDtalk. Mitt Romney and his Republican

advisers claim momentum is on their side as the US presidential

election enters its final stretch. Their unrelenting focus is on the

ailing US economy and their claim that a Romney administration would

rebuild America as a low-tax, small government haven of economic

enterprise. My guest is the founder of the advocacy group, Americans

for tax reform. He is one of the most influential figures in

Republican politics. How credible is Mitt Romney's rescue plan for

America? Welcome to HARDtalk.

Good to be with you. It is clear that Americans have

been somewhat distracted from the battle between Barack Obama and

Mitt Romney by Hurricane Sandy but putting aside the efforts of the

country to clear up from that and focusing on the politics, is it not

a problem for you on the conservative side of the fence that

your argument with Barack Obama, that he has failed to manage the US

economy, is looking increasingly threadbare as the economic

statistics show that the economy now is clearly in recovery mode?

The economy has technically been in recovery since July, 2009. We have

been in recovery for almost all of President Obama's presidency. But

if you compare this recovery from when it started to that of Ronald

Reagan's economy, if we were matching, going out for two months

in each economy -- heat recovery, there would be 10 million more

Americans at work today if Obama had followed Ronald Reagan's tax --

path of cutting moderate tax rates, reducing regulation instead of

expanding it and trying to reform entitlements instead of putting new

ones on top of all the ones that have not been reformed. This has

been a disaster of a recovery compared to what Ronald Reagan did,

compared to every single recovering since the 1930s. With respect,

Ronald Reagan inherited a difficult economic situation in 1981, but

nothing like Obama's inheritance from George W Bush after the global

financial crash the US economy was in meltdown. You had a massive

deficit and debt problem to deal with, which Obama is still

wrestling with, but he has, if you look at the figures, the

unemployment figures, the growth figures, housing starts and

everything else, he has over four years finally injected confidence

back into the US economy. OK, you must be a very young man

because you do not remember that when Reagan was elected, interest

rates in this country were over 20%. Prime interest rates. Inflation was

over 10% two years in a row. We had a declining standard of living. And

we had a decade of decline, not a financial crash. And as you

remember, keeping those UN reform was Obama and the Democratic Party

refusing to break them up and to force them to reform, Freddie Mac

and Fannie Mae. Yes, we had a crash because of Freddie Mac and Fannie

Mae going belly-up and having hundreds of billions of dollars

thrown at them. That was something that Republicans were complaining

about and are arguing to reform for almost a decade. I think we would

have been better off if push it focused more on fighting the

Democrats and Freddie Mac and Fannie Mae rather than some of the

international staff. Let's not get too hung up on the causes of the

meltdown in 2007 and 2008. The fact is that there was a meltdown and

Obama had to react to it. But that is important! Philosophically, I

want to address one issue with you. It seems that you and those on the

Republican to get out selling the idea to the electorate that,

frankly, far from being a force for good in terms of managing the

economy and economic recovery, government is a malign influence. I

wanted a one specific and asked you about it. That is, the bail out.

The government bail out of the water industry in Detroit and the

big three water industry produces. Is it your position as it was with

Mitt Romney, that Obama should have let Detroit to go bankrupt? He did

let it right go bankrupt. But first, he handed out a lot of taxpayer

money to organised labour. They went in and shows some auto

dealerships to be shut down, others not, not through bankruptcy, not

through law, but through political process as. The deal is thought

that a lot more Republican dealerships were shut down than

democrat or independent ones. Then, they went in and if you were

unionised, you got pension subsidies and if you weren't, you

didn't. They went in and took away the legal right that people who

owned debt had to be paid first. They went, no, Union's first. This

was a politicisation of a bankruptcy. Chrysler was sold to a

foreign company and General Motors is exporting jobs. This is not

exactly the brilliant moment for the Obama administration... It was

completely politicised what could have been a natural bankruptcy,

which companies come back from all the time. Yeah, I find what you say

interesting given that you and other senior members of the

Republican team how to deliver a message to the voters of Ohio, for

example, where the water industry provides a substantial number of

jobs, that, you know what, we wouldn't have failed to out. And,

frankly, you probably wouldn't have jobs now. And given that Ohio, sees

2009, has seen a jobs recovery, that might be something that many

voters there might not want to hear. Well... OK... You do know that the

bail out went to two companies - General Motors, Chrysler. Ford it

did not get bailed out. Ford is still functioning. Ford is still

employing people. Ford is in Ohio. Toyota. Many international car

companies operate in Ohio. And it you know much better than I do that

the auto makers generally, including experts were analyse the

for situation, said that if General Motors and Chrysler had not been

saved, Ford and Toyota would have gone bust as well. That would have

been fascinating. That if their competitors were not there, Ford

would have done worse? Or that Ford would have had their competitors

financed against them? And you believe Ford and Toyota would have

survived the General Motors and Chrysler went bust, do you? OK, the

argument when you to a rule of law bankruptcy... The companies don't

go away. All the American Airlines had gone bankrupt and come back.

What you do is you renegotiate and figure out your costs and so on.

All the equipment is still there, all the workers are still there,

all the expertise is still there. If you do end up liquidating a

great deal of debt. What was done was a politicised version of

bankruptcy reform, rather than a legal version. It is not an

improvement. It does get your fingerprints on who you give money

to, who you get favours from, and the automotive industry's unions

are major contributors... What happens is they take taxpayer money

and a report people who give them money. Sorry for the interruption,

there is a time delay, but you paint this as an utterly partisan

moment. The very conservative Detroit News newspaper, which is

actually pushing for Romney in the election, at the very same time has

made it clear in their view, and I am quoting directly from an

editorial: Mitt Romney was wrong in suggesting that alternators could

have found operating capital in the private markets. What General

Motors and Chrysler needed was bridging loans to get them through.

Obama put a rescue team to work and they were true to that task. That

is endorsement from a Conservative newspaper. Sometimes newspapers can

be wrong. I mean... Yes. I just find it, when the argument right

now is about the economy, the role that government should play in this

economy, and when the jobless figures have been so bad for so

long and are now improving, I find it interesting bet your message is

that ultimately the only good thing government can do is get out of the

way. Well, I gave you the two examples of significant economic

disruption just before Reagan. Double-digit inflation. He squeeze

inflation out while dealing with a recession on top of each other. 20%

interest rates, a disastrous economy. The Soviet Union on the

march all around the world. Serious defence challenges, not from

terrorists with our Bee Gees but guys with thousands of nuclear

missiles -- terrorists with rocket propelled grenades. They each chose

a different part. Reading's path created 10 million more jobs and

Obama's Park did. I have written a book on this. It compares chart by

charter President Obama's recovery, which is worse than in France,

compared to Ronald Reagan's recovery. And each period of

economic growth that has followed. This recovery, technically a

recovery, GDP growth has been positive. Terribly weak and lousy

compared to history, millions of Americans are out of work. This

recovery is only one measure of unemployment. If you cowed people

who are not looking for work because they what one but do not

think there are any positions there, or who have part-time jobs because

they want full-time jobs, nothing has got any better. One month ago,

we dropped 200,000 full-time jobs in the US but increased 800,000

part-time jobs because their work part-time jobs but few were full-

time jobs. This is no body's idea of a sound economic policy. On top

of this, to get his lousy period of economic growth, five trillion

dollars of debt for nothing. Let us focus on one specific aspect of the

future plan coming from Mitt Romney and Paul Ryan. That is, eradicating

the deficit over eight-ten years. The deficit, of course, still over

one trillion dollars per year. Piling on a national debt that sits

on something like 16 trillion dollars. Given that context, does

it really makes sense for Mitt Romney and Paul Ryan to be talking

about tax cuts totalling some five trillion dollars? OK, the only way

you get economic growth is to reduce marginal -- reduce marginal

tax rates. Obama was to take them up. We have the highest corporate

tax rates in the world. In Europe, it is 25%. Obama wants to take it

to 45%. Most businesses pay personal tax rates, which he was to

take up from 35% up to 43%. Most American businesses up to 44%.

you know, he does have a plan to cut corporate tax rates as well. It

is not so much about the corporate tax rates. I am fascinated to hear

how you explain that cut in income tax rates, particularly, let's face

it, for the richer, more wealthy Americans, to the tune of well over

three trillion dollars, how that is the wise thing to do in the face of

massive deficit and spiralling national debt. OK. The problem we

have... You keep talking about it. I understand that in the US, that

is what Democrats keep talking about. The problem we have is that

the government spends too much money. The Democrats, the Liberals,

the big spenders, the advocates and lobbyists will be spending in the

US, they say that we have a spending programme, we just don't

look to the passes enough to give money to our friends. -- steel from

the pass is enough. The problem America has, and the good news for

Obama, is that the American people understand that we have a spending

problem, not a tax problem. We spend too much. And the only way to

fix a spend too much problem is to spend next. We know what Obama's

plans are. He walked into office and through $800 billion on the

spending table. Then he added trillions of dollars. Then he put

in a government healthcare programme, which will cost

trillions of dollars per decade as it is finally phased in. They face

it is slowly because each part of it is so in pop -- unpopular, they

The poll is that independent tax economists who have studied the

plans to do the maths has not add up. They say it will not work. They

say the plan cannot work, it is not mathematically possible. But to

give you some numbers for your viewers to keep in mind. If over

the next ten years the United States crones not that 2%, but 4%,

added to that of 41 decade, he increased revenue's that is an

increase. That is a big if. Regan and did it. The point is, if you

want revenue, you have growth. We have Obama's plan, what does he

want to do? The Warren Luff that are planned. A 30% tax on any one

who makes more than $1 million a year. Regardless of how you learn

the money, 30% is tax. There would raise - the deficit is seven

trillion dollars. - it would raise 49 billion. Less than 1% for the

debt better Obama will accumulate. The idea that he bought and raise

taxes on the debt, even his own numbers laugh at that. He gave me a

lecture about Reagan before and I doubt your knowledge of the man,

but as I understand it, after having cut taxes, he raised them

three times. Bill Clinton raised taxes and he delivered an economic

boom as well. You can raise taxes and deliver growth. We will clarify

the difference between tax rates and total tax burdens. Reading took

the top rate from 70% to 50%. He never allowed the rates to go up.

There were times when the Democrats insisted on certain smaller tax

increases. The only significant one was in 1982. It was the biggest

mistake of his presidency. Spending not go down, it went up. We saw

what happens when you make an increase without cuts. You

mentioned Bill Clinton. What did the growth for the first two years

of his presidency. What was the turning-point? When the Republicans

took control of the Senate and all of his spending plans died. There

is why we ended up with a surplus. He was predicting massive deficits

every year because he would spend every penny he brought them. When

they cut the capital-gains tax without growth. Does it worry you

that some respected Republicans have described Mitt Romney and Paul

Ryan plan as a fairy-tale. They have said the plan does not work

and that you deliver a message that can be summed up as no tax under

any circumstances, even if the country goes to hell. These are

respected Republicans who disagree with your take on the balance

between tax and spending and your approach to the fiscal deficit.

Simpson is a former Republican senator from a wedding. He is an

advocate of higher taxes. He does endorse the Democrat running for so

that in Nebraska. The idea that he is a significant Republican... The

reason he has a job is because Obama appointed him. I am willing

to debate his position, but the idea that he has stature in the

party is a fiction. What you're talking about is Up there are some

people who have not read Simpson. The spending cuts are fantasy land.

Obama has rejected every one of them. The tax increases the

Democrats like, spending cuts they have rejected. There is actually a

real budget that has been voted on in the House of Representatives and

pass. This is the Paul Ryan plan. It would bring spending down to 16%

of GDP. It does not raise taxes. It is revenue neutral. It is rude to

interrupt but I want to stop you. He talked about reforming

entitlements. What the plan envisages is in the medium to long-

term, massive cuts to food stamp programmes, to the medical care aid

programme, massive reform and cuts to Medicare as well. They rather

things like college aid, that would go. This is what your entitlement

reform might consists of, isn't it? It is not. It is a good opportunity

to clarify. There are three parts to the reform. We first talked

about cutting food stands and Medicare. What the plan does is

take the exact same reform that Bill Clinton signed. It gets

extended to other welfare programmes. There are 185 means

tested welfare programmes. 77 large ones. You take those and say to the

state, the one success in Clinton's presidency was reformed welfare.

Clinton has attacked his own programme when Republicans to it.

He has put himself in an awkward position. We're talking about

taking the success of Bill Clinton's welfare reform. It was

Roger Regan's idea. -- Ronald Reagan. We remove the devastating

strings and regulations that the federal government sends down to

the state. That saves a great deal of money while giving more

flexibility. We are almost out of time. A final thought. If Mitt

Romney wins, do you believe that he will exacerbate or diminish the

growing economic and social inequality we see in the US today?

I think that he would give strong economic growth which means

millions more Americans working. Les is the most important thing you

can do. Whenever the stock market goes up that would give more

inequality. The recession and the lousy economy has created more the

quality. Resurgence du... The most important thing we should do is

have a free society with as many opportunities as possible.