WASHINGTON, November 11, 2015 − The fourth 2015 Republican presidential debate showed both consistencies and differences among the GOP presidential hopefuls on key issues. Significantly, this Fox Business Channel/Wall Street Journal-hosted debate was the first to strongly concentrate on the issues rather than the distractions that characterized the last debate hosted by CNBC.
On the issue of the economy, which seems to be the number one concern of the American people, the candidates were united in concept, although they did slightly differ on specifics. The main point of consistency among the candidates was that economic growth will provide the solution to all of the economic problems. They agreed that to stimulate economic growth, tax rates must be lowered, burdensome regulations must be removed and incentives must be provided to encourage entrepreneurship and innovation.
On the issue of taxes, the differences centered on how low the tax rate should be, how much if any income could be earned before a tax liability was incurred, what deductions will be permitted and how flat or progressive the tax rates should be. The consensus view that is likely to prevail during the 2016 Republican convention next summer−during which the GOP platform will be developed−will favor low tax rates with little or no progressivity and an allowance for earning some minimum level of income before taxes are assessed.
Donald Trump summed it up best when he said that although there are differences in the tax proposals of the candidates, any of their proposals would be much better than the system we currently have.
As previously noted in this space, the Busler Single Rate Tax plan may be where the Republican Party is heading. This plan calls for a single rate tax of 15% on all income above a livable minimum (twice the poverty rate) with no deductions for anything. All income is taxed the same, including capital gains and the corporate tax rate is set at 15%. Also the entire 12.4% Social Security tax will be paid by the employer, with none being paid by the employee
The candidates generally agreed on the current level for the minimum wage. While it is popular to raise the minimum wage, the candidates understood that substantial increases will also result in increasing unemployment and end up hurting precisely the individuals that those wage hikes are intended to help.
All the candidates recognized the rolling disaster that would result from increasing the minimum wage too much and too fast, especially if it is raised to $15 per hours as some local jurisdictions like Seattle have already put into effect.
Since many of the GOP candidates have actual business experience, they knew that $15 per hour equates to $31,000 per year. Add in the more than $1,800 the firm must pay for Social Security per employee and the health care cost of at least $3,000 per employee and the total cost of that minimum wage employee approaches $36,000 per year. Very few businesses would be willing to pay $36,000 per year for a worker who has absolutely no skills.
Studies have also shown that a $15 per hour minimum wage would dramatically increase teenage unemployment from the 20% historical average up to at least 30%.
While the minimum wage increase would have a minimal effect on the overall inflation rate, it would significantly raise prices for specific industries, particularly fast food where the $1 menu would turn into the $1.39 menu.
The Republican candidates generally agreed on the need to change the current administration’s foreign policy and once again have the US take a much stronger world leadership role. The sole dissent on this issue came from Rand Paul who said it is simply not conservative to spend a trillion dollars to fight wars that should be fought by the countries involved rather than by the US. The other candidates seemed to suggest that a strong defense policy ensuring US security is indeed a conservative philosophy.
The candidates seemed to be in agreement that the current health care law, the Affordable Care Act (ACA), frequently referred to as “Obamacare,” should be repealed and replaced by a system that is more efficient, less costly and removes the dominant role of government from the equation. While all were a bit short on specifics, the general view was consistent.
The general theme of the debate was that no matter which GOP candidate is finally nominated, the public now knows what the party’s and the winning candidate’s positions on key economic and policy issues will be. The candidates argued that the concrete proposals and solutions they are presenting differ significantly from what the Democrats offer.
It was noted that presumed Democratic nominee Hillary Clinton was in favor of free trade, then changed her mind to oppose it; was in favor of the Keystone Pipeline, and than opposed it; was in favor of a small increase in the minimum wage, and then increased the amount significantly; and failed to support same-sex marriage before she did support it.
In Tuesday’s Milwaukee debate, the Republican message rang clear, no matter who the eventual candidate will be:
- Lower tax rates for all Americans s
- Smaller government
- More freedom for Americans
- An emphasis on individual responsibility rather than social responsibility
Isn’t this what most Americans really want?