FUTURE-01
Spokeswoman on the Future of the Democratic Party; Michael Mukasey on
Pres.-Elect Trump Severing His Ties to the Trump Organization; Steven
Mnuchin & Wilbur Ross on Trump Economic Plan for 2017 and Beyond; House
Majority Leader McCarthy on Legislative Priorities in New Trump Admin - Part 2>
McCarthy>
Michael Mukasey; Policies; Economy; Taxes; Trade; Kevin McCarthy; Congress;
Legislations>
WILBUR ROSS, COMMERCE TREASURY NOMINEE: Well, trade is the important thing to change, and tariffs are one potential ultimate tool. But really, they're for the most part a negotiating tool to get the countries to relieve the tariff and non-tariff barriers to our trade. The real objective is to build our exports, not so much to kill the imports. It's a total mischaracterization of what's being done. If need be, there will be tariffs and there will be especially tariffs for punitive purposes for people who dump.
BARTIROMO: Steven, if it's one thing that you hear from managers of businesses and CEOs, it's over and over again, it's the fact that our tax plan is the most unfavorable in the industrialized world, the highest taxes in the industrialized world.
Talk to us, you said in the first 90 days you're going to have tax reform. Walk us through it.
MNUCHIN: Sure, so this is going to be a major priority and there's two aspects of it. One as I mentioned is corporate taxes and the other is personal income taxes, and we're going to simplify the personal income tax, lower from seven brackets down to three, simplify it, deliver a very significant middle income tax cut that's going to be combined with the child care program.
And the other aspect of it is on the upper end, not -- we'll cut the tax rate, but it will be offset with a significant reduction of deductions. So, for the upper class, it won't be a tax cut but it will be a simplification, it will lower the marginal rate, which will spur investment.
BARTIROMO: You say it will spur investment, because you have to assume that, with a better situation on earnings, because companies are paying less in tax, they will reinvest that money in their business and higher?
MNUCHIN: Absolutely. We fundamentally believe in dynamic scoring of taxes, and this is something we're going to be working with Congress and passing legislation.
BARTIROMO: What regulations out there do you think are most onerous, that you really do need to take a second and third look at?
MNUCHIN: Well, the first thing we're going to do is look at Dodd-Frank. It is way, way, way too complicated, and there's many aspects of it that we got to kill. There's many aspects of it that prevent banks from lending, and we need to make sure that banks lend. We want to see huge growth in this economy. It's small and medium-sized business and we need to make sure the banks are lending to them.
BARTIROMO: So, the rules had become so stringent that the banks pulled back, and they were lending less. Is that right?
MNUCHIN: Absolutely. And the rules are so complicated, that many times banks don't even know how to interpret many of the rules. So, let me just say, you know, I believe we need to have proper regulation of banks that have FDIC deposits to make sure that we keep the safety of FDIC deposits. But having said that, there's many aspects of Dodd-Frank that cross over so many things that make no sense, that we're going to look at.
BARTIROMO: Well, you probably experienced this as well, Wilbur.
ROSS: I did, in the banks that we have.
BARTIROMO: Yes.
ROSS: The average small bank now has more compliance people than lending officers. That's a very flawed business model.
BARTIROMO: Even at the large banks, the regulators have offices there, right?
ROSS: Absolutely. That's not the way to run a bank. Government is not the right way to allocate capital. Private sector is the right way. Look at Fannie and Freddie, the two things the government had the most influence on. They're not exactly role models.
BARTIROMO: Would you move to change Fannie and Freddie at this point, move to have these privatized?
MNUCHIN: Absolutely. We got to get Fannie and Freddie out of government ownership. It makes no sense that these are owned by the government and have been controlled by the government for as long as they have. In many cases, this displaces private lending in the mortgage markets, and we need these entities that will be safe.
So, let me just be clear. We'll make sure when they're restructured they're absolutely safe and they don't get taken over again but we got to get them out of government control.
BARTIROMO: So, tell me about NAFTA. What do you want to change about NAFTA?
ROSS: Well, I think the right way to negotiate NAFTA is in conference rooms with Mexico and Canada, not, frankly, in the press room.
BARTIROMO: OK, that's a fair point, but you know, a lot of people worry, businesses in particular, that if we're going to see pulling out of TPP, looking at NAFTA, changing NAFTA, looking at anything else that may not make sense, is it too much at once? Will it create disruption as opposed to growth?
ROSS: First of all, it isn't a question of pulling out of TPP. TPP does not exist.
BARTIROMO: Right.
ROSS: It's a fiction of people's imagination at this point.
BARTIROMO: Obama wanted to push it until the last days in office. Come on.
ROSS: It's especially a figment of his imagination.
BARTIROMO: Right. So, that's the question, though, in terms of disruption. Too much at once. What do you say to that?
ROSS: My point is it's hard to say there's disruption when you don't do something you weren't doing anyway.
BARTIROMO: What about NAFTA?
ROSS: NAFTA needs to be fixed, but it's not going to be fixed with blowing up the whole world. Mexico is not going to go to zero. Canada is certainly not going to go to zero, but there are changes needed and I think the markets are recognizing it.
Look how the peso has acted. If that doesn't tell you that everybody knows there will be change, I don't know what does.
(END VIDEOTAPE)
BARTIROMO: My thanks to Wilbur Ross and Steven Mnuchin.
Up next, House Majority Leader Kevin McCarthy on immigration and repealing Obamacare. We're looking ahead to 2017, this morning on "Sunday Morning Futures".
(COMMERCIAL BREAK)
BARTIROMO: More now on some key economic issues ahead in the new Trump administration. I'm with House Majority Leader Kevin McCarthy.
Congressman, you said you'd be all about jobs. Tax reform is a priority, repealing and replacement Obamacare is a priority and border security is a priority. How do these things lead to jobs? Walk us through what your priorities are for '17 and when do you think you could actually get these things done?
REP. KEVIN MCCARTHY (R-CA), HOUSE MAJORITY LEADER: Well, I think all of these are going to have to start right away. That's why I set the calendar for Congress. We made sure within those first 100 days we're working in session more.
BARTIROMO: That's excellent.
MCCARTHY: We add weeks that we're working in there, we look at not just 100 days, but the first year, and we want to be working closely with this administration, the Senate as well. So, we've been meeting on a weekly basis. There's certain things we can do right away and certain things we have to start and make sure we get it right.
One, when it comes to border security. You've got to make sure your country is safe. So, President-elect Donald Trump has run on making sure this border is secure, you'll see an early bill with that. Regulations that we can deal with early on, looking at rolling them back in others.
We'll start moving those, article one, when I talked about the REINS As act and the midnight, and the midnight rules, Sue and Settle.
And then you look at Obamacare, it has failed and everybody knows it. So, what are we looking at in a different place? We have to repeal it first, and then we're going to do, replace it with new legislation where you get greater choice, more doctor/patient relationship, a health care system that actually works, that the premiums go down, greater choice. Not an easy thing to do.
BARTIROMO: All those insurance companies, united, universal, they said they were going to lose $1 billion, they pulled out. Do you think you're going to be able to work in terms of the insurance companies offering health care?
MCCARTHY: Oh, yes. You want to have individuals that have greater choice, more options out there to pick from, and I've already sent a letter to every governor and every insurance commissioner, give us your ideas as well. So, it's not just the House or Senate involved. We want everybody's input in this, because we want to get this right.
BARTIROMO: Explain sanctuary cities to me because I don't understand why or how it's possible that for all of these years, we've been blowing off the law. I mean, what are you going to do with mayors like Rahm Emanuel who say, "Look, if you're illegal, you're safe in Chicago"?
MCCARTHY: No, America's strong because of the rule of law, and if you break the rule of law, you break down society. Two years ago, we passed a bill, if you want to ignore and only pick and choose which law you want to enforce, then you should not be recipients of federal money.
I think the sanctuary city issue is going to go away. These mayors are going to realize, they can't pick and choose what federal law they want to enforce or not. So, we need to protect the citizens there. Why would they want these individuals to come there illegally, not knowing who they are and protect? Their first role is to protect Americans.
BARTIROMO: So, how far are you willing to go in terms of voting, in terms of holding back federal funding for these cities?
MCCARTHY: Well, we've shown two years ago if you want to pick and choose the law, and it's not just in sanctuary cities. We have to be a country that has rule of law, a fairness. You can't pick and choose which ones they are.
So, you've got to uphold the laws that are passed. You've got a balance within to go through it. If you don't want that, then you shouldn't want the federal money to come with it.
BARTIROMO: Wow.
MCCARTHY: It's that simple.
BARTIROMO: There will be a lot of debates in the New Year, I could see that.
Let's talk tax reform and go back to that for a moment. We had Steve Mnuchin on the show recently, incoming treasury secretary. Here's what he said about priorities in '17.
(BEGIN VIDEO CLIP)
MNUCHIN: Our number one priority is going to be tax reform. We think by lowering the corporate tax rate, we're going to make U.S. corporations incredibly competitive and create enormous amounts of money that comes back on shore and creates jobs.
(END VIDEO CLIP)
BARTIROMO: Trump's plan is a 15 percent corporate tax rate, the GOP House plan was 20 percent, where do you see this going?
MCCARTHY: Well, we'll sit together and work -- the only way I see it going, it's going to get lowered. If we want to create more jobs in America we have to create a structure that makes us competitive.
Right now, we're not. Right now our corporate tax rate is so high, it gives you incentive to be in another country. We also, if we're in a world economy, you create money in another country, we punish you if you want to bring that back to invest in America, we're going to change all that. Keep America competitive where we can compete around the country, create a tax system that's fair, create a tax system that's simple. We have a tax plan that fits on a postcard so every family can fill it out themselves
BARTIROMO: But should we be pushing and warning companies if you go overseas and try to get your products back in, you'll get a 35 percent tariff?
MCCARTHY: No, I think the way we solve competitiveness we create a struck too you are that makes you want to be in America. And I think lowering the tax rate, dealing with repatriation so the money can come back to America, invest in America for American jobs, solves the problem that we're trying to go out after.
BARTIROMO: So, you're not expecting to be warning the way President-elect Trump has done?
MCCARTHY: I think what President-elect Trump is doing, he's warning others that America is not competitive today, and that we're going to change all that. We're going to work closely together to make sure we get a tax code that's fair and that works.
BARTIROMO: And real quick on infrastructure, Congressman, are you going to spend $1 trillion on infrastructure? As a conservative?
MCCARTHY: A trillion dollar is very expensive. You know, I came into Congress, watched the President Obama do this stimulus and at the end of the day, more people believed Elvis was still alive than the stimulus created jobs.
But what you can do, currently today, the regulations to build a road, you wait a decade for that. You could see the reforms there, and what I like about President-elect Trump doing, he brings that business idea in, what about a private partnership? What about taking investments from the outside, changing the structure, so you can build it faster and looking at infrastructure in a different manner to make sure we build America stronger where we can be competitive.
BARTIROMO: That's what I was trying to say. As a conservative, you can't like $1 trillion in spending. You're saying you could probably get there without spending that much money?
MCCARTHY: Oh no, you can make reforms and build something easier, faster and cheaper, and you can take a reform where you allow private sector money in to make it happen as well.
BARTIROMO: Congressman, you've got your work set out for you. We're wishing you the best.
MCCARTHY: Well, I'm telling you, we will not miss this window of opportunity. America puts trust in us, they want to see change and we want to make sure it happens.
BARTIROMO: Congressman Kevin McCarthy, joining us, thank you so much.
MCCARTHY: Thanks for having me.
BARTIROMO: Great to talk with you.
We'll be right back.
(COMMERCIAL BREAK)
BARTIROMO: Well, one week until year end and it was a year that saw major stories gather the nation and the world's attention. The biggest has changed the political landscape in Washington. President-elect Donald Trump surprise victory on November 8th over Hillary Clinton was voted the top story of the year, in an associated press pool of editors and news directors.
We bring in our panel right now. Ed Rollins is a former campaign manager for the Reagan/Bush ticket in 1984. Joe Trippi is a former campaign manager for Howard Dean and a FOX News contributor.
Gentlemen, good to see you.
And, wow, what a year. It really has been an honor to sort of navigate things with you all year, Ed.
ED ROLLINS, CNN POLITICAL ANALYST: Well, the truth of the matter is we sat here a year ago and said that Donald Trump is going to be president and Hillary Clinton and Democratic Party are going to be in kind of disarray. Just the opposite story could have been told. I think most people thought Mrs. Clinton was going to be the president and, obviously, the Democrats would do well in the House and Senate.
It just goes to show that campaigns matter and politics matter and candidates matter. And I think to a certain extent, Trump became this extraordinary candidate by the end who captured these last couple of weeks, this great unrest that's out there today and now he's to produce.
BARTIROMO: You know, we were just talking with Karen Finney and she felt like it was the coverage from the media. Why do you think all of that is?
ROLLINS: Well, you live with the media. I mean, the truth of the matter is they're very much a part of the campaign. But you have to capture that concern of the voters out there. And Trump talked to that voter that was very unhappy.
BARTIROMO: He sure did, Joe, because he made his campaign all about jobs.
JOE TRIPPI, FOX NEWS CONTRIBUTOR: Yes. And he also made it about Twitter. I mean, look, what we saw was not just -- first of all, Ed, and I talked a year ago. We all would have agreed that if Trump had won, it would have been the biggest -- should be the biggest news of 2016. And it is.
The second of all, it's clear that the change in media environment, and his understanding of social media, and how to keep his, you know, what he wanted in front and center and have mainstream media pick it up, was a bold stroke that worked for him. And I think we're going to see it looking forward, in his presidency for sure.
BARTIROMO: Well, how much of it was, though, that she was a flawed candidate? I mean do you think things would have been different had President Obama pushed somebody else forward? Or had the Democratic Party not been afraid to challenge Hillary?
TRIPPI: Look, I -- look I think when you lose by 78,000 votes the three states that she lost, every single reason that everybody is putting out there, from hacking, to Comey, to their inability, Democratic inability to turn their vote out, every single one of them is going to be right. Every single reason is why she lost. But the fact of the matter is she did win the popular vote. I'm not -- he's president. Not taking that away from him.
BARTIROMO: Right.
TRIPPI: But I'm saying that in the end I think the party needs to take a seat, look at what really did go wrong. Not -- I mean, the Comey and the other things are, and whether her server, those are all things that weren't in control. But did we get out the vote the right places? Did we have a message that appealed to blue collar workers in the Midwest? You know.
BARTIROMO: Right.
TRIPPI: And clearly, we need to improve. So, I mean, I think it's distraction to talk about the other stuff, even though I think as a country we should look into what happened, with the Russians, to make sure we understand it. I don't think that as a party it does us any good to focus on that when we should focus on what did go wrong.
BARTIROMO: Especially when you look at Wisconsin, Michigan, Ed.
ROLLINS: She didn't create any excitement.
TRIPPI: Yes.
ROLLINS: She's obviously a woman who served her country very ably and well and served both as first lady and senator of her state. She was the inevitable nominee and she probably shouldn't have been. She wasn't a very good general campaign, and for a variety of reasons she got knocked off.
But the integrity issue was her issue. She built up over a 30-year period, people didn't believe she was honest and I think to a certain extent that's what did her in in the end.
BARTIROMO: What about the Republican Party, Ed? Let's face it, Donald Trump was not an establishment candidate by any means. A lot of the GOP was against him.
ROLLINS: He's still not an establishment candidate.
BARTIROMO: Right.
ROLLINS: It's now his party. He has the Congress, both the House and the Senate. They're not going to roll over and play dead for him, particularly the Senate, but he has to lead them and he has to basically put some wins on the board, he has to do some things that make Americans feel better about themselves and he really has to drive this economy.
If he drives this economy, in two years the economy's better in those states we talked about there, then, obviously, Republicans will do well in the future. If not, we'll have failed and failed miserably.
BARTIROMO: It's also an experiment in terms of creating an environment for business that they will hire, because the Dems will say that's actually not the way to grow an economy.
ROLLINS: Well, I think we're going to have to rethink how we grow an economy. And I think the combination of growth, robotics, and where we go there -- we're not going to need the big manufacturing jobs back in this country. They're not going to come back from China, Mexico, anywhere else. So, you have to duplicate some other kind of job. That's going to be the test.
BARTIROMO: Yes, it's about skill sets.
All right. We'll take a short break. And then, when we come back, we're looking ahead. The one thing to watch in 2017 from our panel, on "Sunday Morning Futures", next.
(COMMERCIAL BREAK)
BARTIROMO: And we're back looking at the big thing to watch for the New Year.
Ed Rollins, what do you think?
ROLLINS: Well, first of all, I'm going to watch President Trump. I mean, he's a big personality. Can he deal on the world stage? Can he get his agenda through? He has a brand-new team, most of whom have never been near Washington and certainly the positions they're in. And we'll see if he can move the Congress. If the Congress basically and he has a collaboration and can push some stuff through, then, obviously, we'll have a good year.
BARTIROMO: And also, Joe Trippi, the experiment of putting all these business people in government roles.
TRIPPI: No, that's absolutely correct. And I think, look, we -- you celebrate, you know, getting 20,000 on the Dow, that's going to inevitably happen, a lot of working people were left behind. They weren't part of that rally from 10,000 to 20,000. And Obama's Democrats paid a price for that anxiety, and watching the -- you know, Wall Street move but nothing else did, in those states we talk about, Wisconsin, Michigan, Pennsylvania.
BARTIROMO: Yes.
TRIPPI: The question is, is that what you're looking for? Does this administration, with its business leaders, does it change that? Or does it work like everything keeps moving in Wall Street like they're still getting left behind? That's going to be what to look for in 2007.
BARTIROMO: Can they do it? Real quickly.
ROLLINS: I think they can. I think they got a year to do it. They're going to move a lot of stuff fast.
BARTIROMO: All right. Ed Rollins, Joe Trippi, good to see you both.
That will do it for "Sunday Morning Futures". I'm Maria Bartiromo. From all of us, have a very merry Christmas and wonderful New Year.
"Media Buzz" begins now.
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