Yesterday, Florida Senate candidate Marco Rubio announced a pro-growth plan that channels Ronald Reagan and Jack Kemp. The “23 Ideas to Reclaim America” Rubio laid out is a refreshing step in the right direction of serious policymaking: His ideas would halt massive tax increases, help bring certainty to the market, and give the Gulf region tools it needs to recover. While incentive-based tax rate reduction make up the bulk of Rubio’s job creation plan — extending the 2001 and 2003 tax cuts, slashing the corporate tax rate, permanently abolishing the death tax, and ending double taxation — he also calls for repealing and replacing Obamacare, opposing card check, preventing energy and value-added taxes, and halting regulations that hurt job creation, especially for smaller businesses.
And, unlike most Republican candidates, who are focused solely on slashing Obama’s spending (as important as that is), Rubio proposes encouraging economic growth and job creation through expanded trade, specifically calling for adopting already-negotiated free-trade agreements with Colombia, Panama, South Korea, and other nations around the world. Free trade is an often-overlooked approach to economic growth and debt reduction. Let’s remember, by generating new tax revenue and automatically reducing spending on jobless benefits, welfare, and other means-tested transfer programs, rapid and sustained economic growth has a powerful impact on the budget: According to OMB’s economic rules of thumb, a sustained 1 percentage point higher GDP growth rate produces $2.8 trillion reduction in the baseline deficit by 2019.
However these ideas are only part of the equation, as spending and entitlement reform are both needed to bring the deficit and national debt in check. Tax cuts plus limits on spending can turn the deficit into a surplus like we saw in the 1990s. Rubio’s spending- and entitlement-reform ideas will be released in the coming weeks and, combined with today’s release, will present a balanced approach to tackling the growing national debt that threatens to swamp us all.
– Cesar Conda, a former economic and domestic policy advisor to Vice President Dick Cheney and the 2008 Mitt Romney for President campaign, is a member of Marco Rubio’s Policy Advisory Committee.