GOP Senate Candidate Wants To Cut Taxes, Build Roads, Bridges

By Scott Benjamin

U.S. Senate candidate Dan Carter says Connecticut, where residents of all dimensions are leaving in search of better jobs, would benefit if the federal government cut taxes across the board, reduced capital gains levies long term and embarked on an infrastructure program rivaling the Eisenhower interstate highway system.

Carter (R-Bethel), who is completing his third term as state representative from the Second District, said the wealthy have been leaving the state for years, more of the people who are about to retire or have their children graduate from high school or college are making plans to leave and, most recently, some younger couples with school-age children are trying to find a way to relocate to Virginia or North Carolina where higher-paying jobs are plentiful.

Connecticut has been beset by budget deficits and the latest labor report indicates that it will be by the end of next year, at the earliest, all of the jobs lost during the recession will have been restored.

Carter, who faces first-term Democrat Richard Blumenthal of Greenwich - the former long-time state attorney general, in the November 8 election - wants a long-term tax cut similar to those of former presidents John Kennedy and Ronald Reagan, an extended capital gains reduction and extensive spending on rebuilding roads and bridges.

He said noted television business commentator Larry Kudlow of Redding, who had considered running for the Republican U.S. Senate nomination, is co-author of a book to be published within days that underscores that the Kennedy tax cut would have been successful if it hadn’t been for the missteps of his four successors – Lyndon Johnson, Richard Nixon, Gerald Ford and Jimmy Carter. Additionally, Kudlow believes the 3-year, 25-percent across-the-board tax cut that Reagan signed in 1981 spurred huge economic growth through the rest of that decade.

“You can’t tax your way back to prosperity,” Carter said in an interview.

However, former President George H.W. Bush increased taxes in 1991 after getting a pledge from Congress to invoke the pay as you go budget controls and in 1993 former President Bill Clinton signed a tax increase and following the 1994 mid-term elections negotiated with House Speaker Newt Gingrich and House Budget Committee Chairman John Kasich to achieve deficit reduction and welfare reform.

Washington Post economics columnist Robert Samuelson has stated that those factors coupled with a peace dividend and an Internet boom helped produce the longest economic expansion in the 240-year history of the United States and four consecutive budget surpluses – the first since 1969.

Samuelson has called the Kennedy tax cut the worst public policy decision in the United States since World War II. Aside from fueling an inflationary spiral that caused four recessions between 1969 and 1981, he contends that after adhering to a policy of balanced budgets and low inflation through the Kennedy Administration, it made it easier for elected officials to increase spending without having to fully pay for the programs. He’s noted that there have been 47 budget deficits and only five surpluses since Johnson signed the tax package in February 1964, about three months following Kennedy’s assassination.

Both of the major party presidential contenders – Republican Donald Trump and Democrat Hillary Rodham Clinton – have endorsed vast infrastructure improvements, saying that they are long overdue, and economist Jared Bernstein – the Ridgefield native who worked for Vice President Joe Biden – has said it would boost the economy.

However, can you afford to do both that and cut taxes when the federal budget deficit already is projected to increase due to entitlement spending for the growing number of Baby Boomers that are retiring?

Carter said the infrastructure improvements would “not be done in any one budget year” and instead would be approached long term and the individual and capital gains cuts would spur huge economic activity, as they did under Reagan, and restore predictability.

He said President Barack Obama, who enacted a tax increase by letting former President George W. Bush’s 2001 across-the-board tax cut lapse in 2013, will be the first president in modern times to leave office with less than at least 3 percent growth in the economy during his tenure. The president’s supporters declare that the current 4.9 percent unemployment rate is nearly 3 percent lower than when Obama won his second term in 2012 and lower than it ever was during Reagan’s eight years in office.

Carter said the unemployment figures have been somewhat unreliable for a while since some people stopped seeking work following the 2008 financial crisis. He also said in Connecticut and elsewhere there have been too many lower-paying jobs. He acknowledged that is partly due to the psychological scars of the recession and the impact that digitization has had on employment.

Irresponsible mortgage practices, particularly by government enterprises Fannie Mae and Freddie Mac, were partly blamed for the fiscal crisis when, according to Blumenthal, some of the big banks were overleveraged as much as 40:1.

However, last year The Washington Post reported that Fannie Mae and Freddie Mac, which were briefly put into conservatorship in 2008, and the other government-sponsored programs now collectively dominate the mortgage market. This comes after Obama announced in 2013 that he wanted to encourage more private lending for mortgages.

Carter said that although the revised federal regulations virtually prohibit another subprime mortgage crisis, he would prefer that more mortgages be made by private lenders instead of the government enterprises, who he believes should only “bring stability” to the market “and should not be controlling it.”

Over the recent years television production has been one of the largest areas of job growth in Connecticut partly as a result of the expansion at ESPN in Bristol, which was under way well before Gov. Dannel Malloy (D-Stamford) announced huge financial incentives for the huge cable sports network. NBC Sports in Stamford, which also has received recent state assistance in an effort to generate more jobs, and Blue Sky Studios in Greenwich, which had moved from New York state, also are major employers.

Carter said for the future he hopes that the state will again add manufacturing positions, which started to disappear in large numbers to lower-wage countries in the early 1980s, and that its aerospace sector will expand.

He said that he’s concerned about the future of the pharmaceutical industry, which has long been a mainstay in Connecticut, since the state government shelved the research and development tax credit two years ago, which had benefitted companies such as Boehringer Ingelheim in Danbury and Ridgefield, one of metro Danbury’s largest employers.

Former U.S. Sen. Joe Lieberman (D-Stamford) predicted during his 2006 re-election campaign that by 2030 fuel cell technology would be the largest sector of Connecticut’s economy.

Since then, UTC Power in South Windsor, which was credited with taking fuel cell technology out of the laboratory in 1966 when it signed a contract with NASA to put it in the space capsules, was sold in 2013 to an Oregon-based company.

Fuel Cell Energy, with operations in Danbury and Torrington, has grown through the recent years and that other companies in the field are expected to continue to add jobs as the technology is used more to produce energy for homes and vehicles.

Carter said much of the future development in fuel cell technology may be dependent on Connecticut’s tax structure.

He said after the economy, security - following the violence in Paris, San Bernardino and Orlando - is the issue most often discussed by voters.

Carter said it can be addressed by reinstalling economic sanctions on Iran, which Blumenthal voted to lift last year in return for a halt to its nuclear program; more closely screening who enters the United States; and being more aggressive against the ISIS.

Regarding the campaign, Carter said Blumenthal, who won handily six years ago even though he had to withstand $50 million in spending by WWE CEO Linda McMahon of Greenwich, the Republican nominee, will run laps around him in fund-raising.

But he said the vast growth in social media “while not being the great equalizer, does help.”

Carter said he didn’t get to meet Trump, who was running behind schedule, at the GOP presidential nominee’s recent rally at Sacred Heart University in Fairfield. However, the Air Force veteran, who spoke at the rally, has been promised that they will meet in person before election day.

He said people who have met with Trump say he is different in person than he is on stage, indicating that he sometimes “comes across as a blue-collar worker.”

Carter said that the support Trump and Democratic runner-up Bernie Sanders attracted during the primaries indicates a vast discontent among the electorate with the status quo. Trump easily captured the Connecticut GOP primary and Sanders lost in a photo-finish in the Democratic balloting.