Tonight’s CNBC “Your Money, Your Vote” debate will grill the Republican field on economic topics. Here are some of the positions in the GOP field that might come up.
Most of the field has put out a tax plan at this point, and the theme is consistent: Major tax cuts for the rich and corporations with varying lesser cuts for middle and lower-income filers. Each plan that’s been scored by outside groups is estimated to add trillions of dollars to the deficit, ranging from $3.6 trillion over 10 years in Jeb Bush’s case to a whopping $12 trillion in Trump’s case.
The main divide is between candidates who want to cut the top tax rate for the wealthy and simplify the overall tax code into fewer brackets and candidates who want to do away with brackets entirely and institute a flat tax of one rate across the board. Donald Trump, Jeb Bush, Marco Rubio, John Kasich, Bobby Jindal all fall into the lower tax rates category. Ben Carson, Mike Huckabee, and Rand Paul fall into the flat tax category.
Here’s an area where there are some real divisions between candidates that might be on display Wednesday. Entitlement spending, especially on Medicare, is the biggest long-term driver of the deficit but it’s also politically difficult to talk about cuts without scaring seniors. Candidates have tried to overcome these fears by proposing changes that won’t take effect until future retirees are eligible for government programs.
Bush released a plan on Tuesday to means test Medicare and turn it into a voucher system similar to ones proposed by Congressman Paul Ryan, which would give seniors the option to choose between a private plan and the traditional government program. His plan would also address Social Security by increasing benefits at the bottom, decreasing benefits for wealthier recipients, raising the retirement age gradually, and penalizing recipients who take Social Security benefits earlier while removing disincentives to work for older Americans. Christie has a plan to raise the retirement age to 67 and means test Social Security as well.
The most talked about candidate on entitlements this week is Carson, who is being grilled over a proposal he made to eliminate Medicare and Medicaid entirely and replace them with individual savings account for taxpayers that the government pays $2,000 into each year. Carson’s current position is not entirely clear, however, as he suggested in a Fox News interview this week that he had changed his mind and now favors preserving traditional Medicare as an option.
Not everyone in the field is a fan of each other’s plans. Huckabee has criticized Christie’s Social Security plan as too tough on seniors and Kasich decried Carson’s call for a total replacement of Medicare on Tuesday.
Compared to the last race, cutting the budget is not as hot a topic. The deficit has fallen by well over half since its $1.1 trillion level in 2012 to $426 billion this year and lawmakers in Congress have given up on negotiating any more sweeping bipartisan cuts. All the candidates favor a balanced budget at least rhetorically – many endorse a Constitutional Amendment to require one, which is unlikely to happen – but it’s hard to reconcile with their massive tax cut proposals and with calls from many for higher spending on defense.
The candidates, for their part, argue that their tax plans won’t be as damaging to the deficit as they look. Rubio has said that his multi-trillion dollar tax cut would eventually pay for itself and Bush has also said his economic reforms, which include immigration reform, would lead to explosive growth that raised more tax revenue, ideas greeted with extreme skepticism outside the most conservative economic circles.
In addition to the candidates’ proposals on entitlements, Paul has put out plans in the past to balance the budget rapidly by scaling back or eliminating federal agencies like the Department of Education and the Department of Housing and Urban Development. Carson has pledged never to raise the debt ceiling again, which would require even more rapid and far reaching cuts to the budget to head off a financial crisis, but he has not put out a plan as to how he would achieve them.
One major area of difference, especially where one front-running candidate is concerned, is trade. Most of the field broadly supports lowering barriers to trade between countries as a means to spur economic growth. A big exception is Trump, who has proposed an array of tariffs on foreign goods and blames “cunning” leaders in China and Mexico for negotiating trade deals that favor them.
The biggest flashpoint over trade now is the Trans-Pacific Partnership, a deal on the table between the United States and 11 other nations – though not China – to encourage trade between countries. The details aren’t public yet, but Bush and Rubio are theoretically on board and a number of candidates say they favor free trade broadly but still want to learn more about the deal. Conservative voters are wary of anything billed as an achievement for President Obama and Ted Cruz, previously a proponent of fast tracking a deal, reversed his position earlier this year. Jindal is pro-trade says he doesn’t trust Obama to negotiate a good deal. Huckabee, who tends to be a trade skeptic, is an opponent of TPP.
Everyone wants to repeal Obamacare, but replacing it is the tough part. The most unpopular aspects of the law that Republicans hate the most (a mandate to buy health insurance, new taxes and spending) power the parts that are most popular (subsidies to buy insurance) and an end to discrimination based on pre-existing conditions.
In general, candidates have kept things pretty close to the vest on the issue. Bush put out a rough outline of a replacement plan this month that would provide tax credits to buy individual insurance for those who don’t get it through work and charge states with crafting individual health plans, but would end the law’s protections for people with pre-existing conditions. Rubio’s also floated a vague tax credit-based plan. Bush’s proposal drew criticism from Jindal, who claimed that it spent too much and has argued Republicans need to accept that any replacement plan will cover fewer people than Obamacare. On the other end of the spectrum, Trump has said he would aim for universal health care, but offered few details on how he would get there.
Kasich and Christie have both used funds from Obamacare to pay for an expansion of Medicaid in their states, a move that’s drawn ire from conservatives. Kasich has no specific plan, but has criticized Obamacare’s mandate while pledging to preserve protections for pre-existing conditions somehow. He has gone after rivals recently for not offering generous enough health care plans, something that could come up in the debate.