The Daschle-Democrats are on the war path on the economy. They are crassly rooting against a recovery, and they are working like armies of wood ants behind the scenes to erode any and all of President Bush’s economic initiatives — including, most prominently, his bold tax-cut plan. Anything that would hasten an economic growth revival before the 2004 elections, they are reflexively opposed to.
#ad#Now we will find out whether that opposition also applies to any person who wishes to spur faster economic growth. On Tuesday, President Bush’s Treasury secretary nominee John Snow, the former CEO of CSX Railroad, goes before the Senate for confirmation hearings. Some Senate Democrats have been threatening to convert these hearings into an ugly and coordinated campaign of character assassination against Snow. Conservatives have become all too familiar with the brutish politics of personal destruction that the Senate Democrats are capable of with regards to many of President Bush’s judicial nominees.
If those tactics are brought to bear against Snow — an exceptional choice for the job — it’s high time that conservatives in the Senate fight back.
I must confess that I know John Snow personally, like him very much, and have an unqualified admiration for his political views and his supply-side instincts. We met when we both served on the Kemp Commission on Tax Reform. What became clear during those months is that Snow wants what the vast majority of Americans want: a radically simplified, single-rate tax system that clears away the barriers to growth in the IRS tax code, eliminates unfair subsidies, flattens tax rates, and doesn’t require hoards of accountants, lawyers, and Valium pills to figure out tax liabilities.
Jack Kemp tells me that John Snow is “thoroughly on the supply side when it comes to the case for lower tax rates.” He is also a free trader and an inflation hawk. From a policy standpoint, there’s very little in this man’s record not to like.
John Snow has a sterling record of accomplishment as a railroad executive. When he became CEO of CSX he helped turn this once moribund railroad into a profitable enterprise — though it certainly has gone through rough patches. His stewardship has created wealth for shareholders and tens of thousands of jobs for rail workers. Any case against Snow’s professional capabilities will be weakened considerably, given that several unions have written letters to President Bush commending him for choosing Snow for the Treasury secretary slot. Byron Boyd, the president of the United Transportation Union, writes: “The thoughtful and successful approaches that CSX has taken on safety and labor relations are but two examples of John’s ability . . . I urge the Senate to confirm him expeditiously.”
In this post-Enron political environment, where every CEO is a member of a suspect class, the Democrats are expected to attack Snow for receiving multi-million dollar bonuses and loans. There is no smoking gun here. Snow’s compensation packages were in no way out of line with the incentives given to CEOs of similarly-sized companies. To get top talent — like John Snow — firms must pay top dollar. This is the economic reality of the marketplace. Why should making money for successfully running a company invalidate someone? And if it does, how in the world was Robert Rubin ever confirmed as Treasury secretary? Rubin made far more money running Goldman Sachs than Snow did at CSX. So did Sen. John Corzine (D., N.J.), also a partner at Goldman.
Why is making money only a crime when the wealth creator is a Republican?
Democrats will also certainly use the Snow confirmation hearings as their first opportunity to savage the president’s economic plan in a public forum. That’s fair game. Snow must not back off. He, and the Senate Republicans, must assault the assaulters. The Republicans should recite the history of supply-side tax-reduction successes under JFK and Reagan — and even Clinton (who signed the capital-gains tax cut in 1997). They should ridicule the Democratic plan, which stimulates nothing but growth in government and offers about one-fifth the tax relief that the president’s plan provides.
The Republicans in the Senate — but most importantly, John Snow himself — should not suffer fools gladly. If the Democrats attack the tax-cut plan for being “fiscally irresponsible,” Snow should ask his accusers why they vote to continually pad spending bills with billions of dollars of pork and multi-billion dollar program expansions with more debt spending (as they did last week with a $390 billion appropriations bill). If they attack Snow’s business acumen, then he should point out that almost none of his prosecutors have ever run a business, or met a payroll, that wasn’t paid for with taxpayer dollars.
With the economy showing further signs of weakness in recent weeks (fourth-quarter 2002 GDP growth is now estimated at an anemic rate of 1%), the country desperately needs the president’s economic- and jobs-growth tax cut. And what the president’s tax plan needs is dogged, determined, and compelling defenders. This is Snow’s first big test. My bet is that he will pass with flying colors — much to the disappointment of the Daschle Democrats.
— Stephen Moore is president of the Club for Growth.