Newt’s romp on the couch with John Kerry
“Because you want the government to pay for it with a great big tax credit. If it’s big enough to do what you say, it’s actually going to be more expensive than having the private sector go out and capitalize it in the private market….You want the research, you want the tax credit. That’s a government solution.” Sen. John Kerry
[Newt debate clips]
Four years ago, Sen. John Kerry and House Speaker Newt Gingrich took to the podiums at NYU’s Robert F. Wagner School of Public Service to have an unstructured debate about solving the environmental crisis. Newt began by stating that there was a consensus in the scientific community that the earth was getting warmer and that human activity was contributing to that warming, but rejected the idea that we are headed for an immediate catastrophe.
Still, he felt it was important enough that the government needed to get involved:
“So, it is a problem. We should address it. And we should address it very actively.”
He proposed what he thinks are “economic” solutions:
“[23:12] And I have to start with the idea we have an absolute requirement as a human race to be committed to economic growth. We also have a requirement, if you’re going to be realistic about the environment, to be committed to economic growth in China and India, which means, any serious strategy has to be thinking through what would green development look like in Africa? And what would a green economy look like in India and China? And for that to happen, I would argue, that we have to have a very strong commitment to finding new incentives, to use new science and new technology, and to maximize the rate of innovation. Because you would actually like – the Chinese are going to have cars. The question is, could we accelerate the development of hydrogen cars so the cars they have don’t add to carbon loading?” [emphasis added]
“[23:17] So the challenge to us to lead the world, and I agree entirely with whatever criticism the Senator wants to make in general about the absence of American leadership. I’m not gonna stand up here and defend our failure to lead. I am going to say our leadership should start with science, technology, entrepreneurship, and that we should focus on developing new approaches….”
“[49:18] So I start with, I want a really big solution. I believe a really big solution has to mean very rapid change. And his is a core argument. I’m not talking about a laissez-faire market. I’m in the Alexander Hamilton/Theodore Roosevelt model. I’m for an incentivized market where, for example, we have very substantial tax credits for the auto industry to convert over to dramatically better cars. We have a very substantial tax credit to trade in the oldest and most polluting of cars. We have a very significant tax credit to go to a clean coal technology. Because if you don’t help provide the capital – the morning you provide he incentives, there will be 50,000 entrepreneurs trying to figure out how to get the money. The morning you try to do it by regulation, there will be 50,000 entrepreneurs hiring a lawyer to fight you. It’s a fundamentally different model.”
“[53:27] We’re arguing over whether bureaucracy is a better way to be urgent or whether science and technology translated by entrepreneurs into products is a better way to be urgent. And I would argue, most of American history argues, that the market can move faster than a bureaucracy to provide solutions if you incentivize the market.”
“It is obvious in the case of a subsidy that the taxpayers must lose precisely as much as the X industry gains. It should be equally clear that, as a consequence, other industries must lose what the X industry gains. They must pay part of the taxes that are used to support the X industry. And customers, because they are taxed to support the X industry, will have that much less income left with which to buy other things. The result must be that other industries on the average must be smaller than otherwise in order that the X industry may be larger” (p.101).
“[1:19:15] And when I was speaker, I think it’s fair to say, that on things, that on a whole range of biodiversity issues, I intervened again and again on the side of the environment.”
“Gingrich can be a fire-eater before a friendly audience, but he has a history of turning conciliatory when he has to deal with actual Democrats. One recalls his embarrassing tributes to President Clinton during the days when Clinton was eating Gingrich’s lunch in budget negotiations. Like most conservatives, I am fond of Newt and will always be grateful for his leadership in the years leading up to the 1994 GOP takeover of the House, and in the early aftermath of that takeover. But there is little in Newt’s record to suggest that he would be the most effective conservative standard-bearer in a presidential election.”
“Gingrich has an affinity – all too common even among conservative politicians – for gimmicky, special interest tax incentives that empower politicians to pick winners and losers in the marketplace. His favorite device is the tax credit.
In the wake of the 9/11 terrorist attacks, Gingrich proposed a six month, $1,000-per person tax credit for 50 percent of the cost of personal travel more than 100 miles from one’s home. The idea sounds nice, but just as Cash for Clunkers only expedited the purchase of cars people were going to buy anyway (at non-car buying taxpayers’ expense), Gingrich’s Cash for Getaways would only have subsidized trips people were going to make anyway, enabling a transfer payment to frequent travelers from families without the time or inclination to travel. This proposal would also require more government to administer and oversee compliance. It is not a fiscally conservative policy. While perhaps not a large issue in itself, this is indicative of an approach Gingrich has frequently advocated. At times he has sponsored bills or issued proposals to do the following:
- A tax credit for the purchase of home computers used for educational or professional purposes.
- A $1,000 tax credit for low-income first-time homebuyers.
- Refundable tax credits for auto companies for the cost of flex-fuels cars, hybrids, plug-in hybrids, and the development of hydrogen cars.
- Tax credits to encourage investment in biofuels and “renewable forms of energy.”
- A permanent 50 percent tax credit for research and development, or at least for “companies that are willing to take on government’s ‘grand challenges’ (for example, the first inhabitable moon base).”
- A special business tax credit for “corporations that fund basic research in science and technology at our nation’s universities.”
Along with these gimmicky tax proposals, Gingrich voted for at least one tax increase during his time in Congress. In 1984, he supported a $50 billion tax bill that closed $15 billion in loopholes, eliminated a tax break on interest income, increased cigarette taxes, and raised taxes on distilled liquor. “