GOP hopeful Kasich details ‘doable’ balanced-budget plan


NASHUA, N.H. (AP) – Republican presidential candidate John Kasich vowed Thursday to balance the federal budget within eight years as part of a domestic agenda led by broad tax cuts and a yearslong freeze on all spending except the military.

The Ohio governor’s budget framework would focus tax cuts on businesses and the wealthy – though at least one provision is aimed at lower-income people – and dramatically scale back the federal government’s role in administering education and transportation funding. It’s an agenda for the first 100 days that is not as aggressive of some of his more conservative rivals, but one he predicts will prompt criticism from opponents in both parties.

“I will immediately put us on a path to a balanced budget and I will get it done within eight years,” Kasich said Thursday at Nashua Community College. “It starts by setting your priorities and then having the courage to make choices that might be unpopular.”

The policy rollout comes as Kasich fights to stand out in a packed 2016 GOP field. In an election season celebrating political outsiders, the 63-year-old Republican has an insider resume that includes 18 years in Congress and two terms as governor in one of the nation’s key swing states. Yet his blunt style resonates with some voters, particularly in New Hampshire, the unofficial staging ground for his campaign.

Kasich called for broad tax cuts that would grow the budget deficit in the first few years, according to projections his campaign shared with The Associated Press. His advisers predict that economic growth sparked by the tax cuts, backed by cuts to Medicare and Medicaid and an eight-year freeze on all non-defense discretionary spending, would eventually offset lost tax revenue to balance the federal budget for the first time since Bill Clinton was president.

Kasich’s tax plan would lower the top individual tax rate from 39.6 percent to 28 percent, reduce long-term capital gains tax rates to 15 percent and eliminate the estate tax, lower the top business tax rates from 35 percent to 25 percent and double the research and development tax credit for small businesses.

“This looks like a pretty big tax cut for the top end and a little bit at the bottom,” said Robertson Williams, a senior fellow at the Urban-Brookings Tax Policy Center. “There’s not much going to the middle class.”

While most of the cuts benefit the wealthy, Kasich would increases by 10 percent the earned income tax credit, a measure designed to help lower-income taxpayers.

“If you are a person that thinks you ought to pound the rich into submission, I guess you won’t like the plan,” Kasich said in an AP interview before the speech.

At the same time, the Republican governor would dramatically reduce the federal government’s role in education, transportation, job training and Medicaid. He would package the federal dollars now dedicated to those programs into massive block grants for state leaders to manage locally.

“In the end, you really wonder if you need a full department of transportation,” Kasich said and added, “I’m sending all the programs in the federal government back.”

Kasich’s plan ignores two major federal programs: President Obama’s health care law and Social Security. He said he’ll outline separate proposals on those later.

He does, however, propose a series of cuts to Medicare that would slow the growth rate of the government-subsidized health care program for more than 50 million elderly and disabled Americans.

One of the only spending increases in the plan goes to the nation’s military. Kasich wants to boost military spending by $102 billion, or 17 percent, between 2017 and 2025.

The plan is cause for optimism among some who questioned his commitment to fiscal conservatism after he expanded Medicaid eligibility in Ohio as part of the federal health care overhaul, said Grover Norquist, the president of Americans for Tax Reform and a former Kasich critic.

Norquist called it “a grown up approach” on spending and “significantly pro-growth” on taxes. He also said Kasich’s policies were more practical than some plans that call for blowing up the existing tax system.

“Everything on his plate is doable, is achievable,” Norquist said.

By Steve Peoples

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