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May 29th, 2016

Guests: Former U.S. Senator & Presidential Candidate Gary Hart and Fiscal Policy Institute Executive Director Ron Deutsch

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Former U.S. Senator & Presidential Candidate Gary Hart

Full interview

Hart on the parallels and differences between his campaign for President in 1984 and Bernie Sanders’ in 2016:

 MORGAN PEHME: Senator, reviewing your ’84 campaign for the Democratic nomination, it struck me that there are a number of parallels between your challenge from the left to the establishment candidate, Walter Mondale, and Bernie Sanders taking on the party insiders’ choice, Hillary Clinton.

 Though you won more states than the former Vice President—including 7 of the last 11—and overall you received 6.5 million votes versus Mondale’s 7 million, the race was decided at the Convention because all 800 of the superdelegates voted for Mondale—a similar situation to today when virtually all of the superdelegates were pledged to Hillary Clinton before a single state voted.

 Also, like Sanders you also refused to take PAC money to fund your campaign and a lot of the enthusiasm for your candidacy came from younger voters.

 Yet another similarity is that like Sanders, who is polling far better against Trump than Clinton in a general election match-up, you were polling 10 points better than Mondale versus Reagan—a consideration that made the case you would be a stronger nominee for the party to embrace.

 Do you see parallels between your candidacy and Senator Sanders’ and what are your thoughts on the party establishment pushing Sanders to drop out of the race so Clinton can focus exclusively on taking on Trump?

GARY HART: “There are indeed, as you indicated, some significant parallels, particularly where the superdelegates are concerned. We—my wife and I—called every one of the superdelegates after we swept California and closed out the primaries and every one of them had been pledged even before the primaries began in New Hampshire to Vice President Mondale. So we had an uphill fight going into the convention.

I think there are a couple of differences, however. I did not contest the Mondale nomination, I think, in the way that Senator Sanders is threatening to do if I understand it.

Our delegates—we had over 1,200 delegates—there were fewer overall than at this convention. And we did in fact nominate the platform committee and write a 1984 Democratic platform, (which) if you read it today, is very prophetic about globalization, the technology revolution, military reform and a number of other things. But I think you both know that, for better or worse, people don’t vote on platforms. So that was a difference.

And, finally, let me make a distinction in the sense of ‘liberal.’ Walter Mondale represented the traditional ‘Rooseveltian/Humphrey’ liberal wing of the party. What I think I was trying to do, without calculation, was to redefine liberalism for the ’80s and ’90s to include those forces that were beginning to overtake us like globalization, like information and so forth. And it confused the press because they are used to categorizations and putting people in boxes and my entire detailed domestic and foreign policy didn’t fit into any of those boxes.”

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Hart on how he would like to see the Democratic Party’s superdelegate process reformed:

GH: “First of all, I’m not against so-called superdelegates who are, as you know, elected officials and party officials. And, because of their day-in and day-out dedication to the party and the national interest, they deserve to be at conventions.

.. They (the superdelegates) by and large shut themselves out in ’72 by not conforming, as in Illinois and elsewhere, with the McGovern Commission reforms that required balanced delegations involving women, young people, minorities and so on. And so the predominantly white male party bosses, if you will, shut themselves out of that convention by not conforming. … That then led to the reforms in ’76 that began to create special positions for them.

They (the superdelegates) should go to the convention, but they should be bound by the outcome of the primary or caucuses in their respective states. That is to say, that if candidate A wins 60% of the vote or caucus attendance in state X, then that candidate should get 60%, if you will, of the superdelegates.”

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Hart punts when asked to weigh in on DNC Chair Debbie Wasserman Schultz’ performance:

MP: You have been a thoughtful critic of your own party for a long time. Right now, the party, torn between Hillary Clinton and Bernie Sanders, seems deeply divided, and Senator Sanders is supporting the ouster of DNC Chairwoman Debbie Wasserman Schultz. What is your opinion of how Wasserman Schultz has run the party and what are your thoughts on the current state of the party as a whole?

GH: “I’m going to take a pass for a very simple reason. I live in Kittredge, Colorado, which is 1,500 miles from Washington and there are a lot more important things going on in the world than who runs the Democratic National Committee, with all due respect.”

Link to audio

Hart on how the United States should handle North Korea and Trump’s offer to meet with Kim Jong Un:

BILL SAMUELS: Donald Trump said recently he is willing to meet with Kim Jong Un in an effort to stop North Korea’s nuclear program. As a foreign policy expert, what do you think of this idea?

GH: “It’s a profound question and, in the capacity of that (International Security) Advisory Board at the State Department, we are currently working on some papers for the next administration generally, and the State Department particularly, on things to think about both near-term and long-term and North Korea is certainly part of that.

There is every suspicion in the foreign policy community that very early in the new administration, regardless of who it is, that North Korea will provoke that administration to test how far we can be pushed. So, whomever the new president is and secretary of state, they better be prepared for something in the area of provocation by North Korea.

I don’t think you do diplomacy by kind of grandstanding in national campaigns. You do it quietly. You test the waters behind the scenes first. What Donald Trump or anybody else should have done is, first of all, wait to be elected and then send, quietly, a private emissary to Pyongyang and say, ‘Are you willing to talk to the next president?’

And if the answer is no, then it’s not kind of blown up out of proportion. You can release a press statement saying, ‘We’ve tried to meet with the head of state of North Korea and he’s turned us down.’ That’s fine. But to sound off in the middle of the campaign about, ‘If I’m elected … I’m going to meet with the dictator of North Korea,’ I don’t think achieves very much.”

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Hart on the latest in the peace process in Northern Ireland and what lessons from that success are applicable to other conflicts around the globe, like Israel-Palestine and Sunni-Shia:

MP: In November, in your capacity at U.S. special envoy, you were integral to the negotiation of a new agreement pertaining to Northern Ireland that further built consensus around the future direction of Ireland. Though I know at times you have been dismayed by continued violence in the region, the peace process in Northern Ireland has, on a whole, been a tremendous success story and you personally have played a significant part in strengthening it in recent years.

Are there any lessons that can be gleaned from the peace process in Northern Ireland that would be applicable to resolving some of the most problematic ongoing conflicts in the world, such as the Israel-Palestine or Sunni-Shia conflicts?

GH: “You know, that’s a very, very good and important question and one that not enough people ask themselves. I sent President Bill Clinton in 1994 a letter, three years after the Cold War, saying now is the time for … us, the United States, to try to intervene in sectarian and other conflicts around the world because this is a moment of reconciliation.

And, of course, then a year or two later … he did announce Senator George Mitchell as an envoy (for Northern Ireland) and that’s when the process of negotiations between Protestants and Catholics and Unionists and Nationalists began to take effect, leading to the Good Friday Agreement of ’98.

And then we have continued. There have been several envoys under several administrations in the 20 years since then to try to help the British and Irish governments, as well as the five principal parties in Northern Ireland, to continue what is generally called the peace process. …

I got involved in August of ’14. By Christmas … we had negotiated what was called the Stormont House Agreement, Stormont House being the seat of government in Belfast. That then fell apart around St. Patrick’s Day and we went back to work, all the parties, and put that agreement back together. And it … got almost no press coverage in America despite the size of the Irish-American community here. But it is probably as comprehensive an agreement between and among the principal factions and interests in Northern Ireland as the Good Friday Agreement itself.

It has to do with the budget and economics and welfare reform, but it also continues the process of trying to continue to heal the wounds of the past, the legacy issues of conflict that went on for 20 years and cost well over 3,000 lives in an area the size of Connecticut with a million and a quarter people. It was a serious conflict and there are remnants still around, so vigilance is still required and good faith on all sides and a sense of reconciliation, to try to round out the answer to your question. I give—a lot of people get credit and two individuals in the Good Friday process were recognized by the Nobel Prize committee for their reconciliation. Right now the deputy first minister in Northern Ireland is Martin McGuinness. He has done yeoman work in reaching out to the Unionist side, the Loyalist side on the British side, more Protestant than Catholic. And I think he more than others has caused the sides to come together.

So, appealing to people’s best instincts, not their worst instincts, trying to override those who counsel sectarian violence—all of those things are pretty obvious. But it just requires an enormous amount of diligence and hard work.”

Link to audio

Hart on the Iran nuclear deal and Donald Trump’s opposition to it:

BS: You have been a vocal advocate for the Iran deal struck last year by the Obama administration. Two questions: Do you think the Iran deal is the President’s greatest foreign policy achievement of his two terms in office and what do you think of Donald Trump’s characterization of the deal as, quote, “disastrous”?

GH: “In reverse order, (Trump’s) pandering. … (He’s) got kind of a corner on that market. He’s just reaching for the most extreme opposition support in various communities and using fear and all kinds of other motivations to try to get votes in that regard.

My judgment is that history will show—I don’t know whether you (can) say the largest, most important legacy of the Obama administration—but I certainly think Secretary (of State John) Kerry, particularly, deserves huge recognition, today and years from now, for his persistence and patience in getting that deal done.

Now, the key to its success doesn’t rest with us, although we still have serious embargoes on Iran that are making implementation of the agreement further difficult. But the key rests in Tehran and there is still sharp division over there between what I think you could call the state, which is the government, and the regime, which are the hardline religious factions and there is great tension between those two forces in Iran. And we simply must hope and pray and support the progressive elements in that government in carrying this agreement out. It’s very, very important.

And finally, just to underscore the issue, this isn’t just a question of another country joining the nuclear club, it’s a question of the dispersal of nuclear technology. If this deal fails, Iran could go back into the market of selling nuclear equipment and technology and to interests that may or may not be responsible and probably would not be. And that would be catastrophic. It is the nuclear capability escaping a more responsible club, that is the danger in the 21st Century.”

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Hart on the greatest national security threats America faces today:

MP: You famously met with then National Security Advisor Condoleeza Rice five days before 9/11 to warn her of the threat of imminent terror attacks in the United States and you also gave a speech the day before your sit-down with Rice to the Air Transportation Association sounding the same alarm. …

You have chaired a number of important commissions focused on assessing the threats our country faces. What would you identify as the greatest threats to our national security today?

GH: “That’s a tough question, but … I’d say there are two different types. One is the terrorist threat and that could be 9/11 or any variation thereof involving not just hijacked airplanes, but biological weapons, chemical weapons or even dirty nuclear weapons.

But there’s another category of threat that does not lend itself to a military … solution. That is climate change. That is pandemics such as (a) virus getting out of control and killing a lot of people—failed states, whole governments that collapse and civil wars break out in Africa or Central America or somewhere else.

So there are an awful lot of … I would shorthand as non-military threats that we have to worry about and anybody who thinks that just spending more money on the military is by itself going to protect this country is just pipe dreaming.”

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Hart on how America is “massively corrupt” by the standard of the founding fathers:

BS: Senator, you wrote a terrific blog entry in which you dismantle the premise of Donald Trump’s slogan “Make America Great Again”.

 You argue that America has not ceased to be great, but that the definition of greatness in a globalized landscape—with so many other powers on the rise—has changed from the domination we wielded after the collapse of the Soviet Union to what you contend should be our role now: which is leading the world on a path to a common good, by tackling issues like climate change, trade, immigration, defeating terrorism, and human rights.

Your very insightful piece ends, however, on a troubling note. You write, quote, “When accountability and responsibility are lost due to corruption, that is the time to be concerned about America’s greatness.”

 What did you mean by this observation and are you concerned that America is succumbing to corruption?

GH: “(The founding fathers) said the greatest danger to the republic they were creating, the new American republic, was corruption, but they didn’t define it as bribery. They defined it as putting special or narrow interests ahead of the common good. And if you use that standard against today’s government, we are massively corrupt.

Let me give you a couple of statistics. I am told that the number of registered lobbyists in Washington in the ’70s was about 160, give or take. Today there are over 13,000 registered lobbyists in Washington.

Back when I went into the Senate, I don’t think one United States Senator became a lobbyist. Today there are over 400 former members of Congress who are paid lobbyists and that doesn’t include their staffs and former administration officials and so forth. There is a revolving door in Washington. It does involve paying for campaigns and gaining access. It is not as simple as bribery, illegal bribery that puts you in jail. It is influence peddling and it’s paying for access, which is the coin of the realm and worth millions, if not billions, of dollars because members of Congress only have a limited number of hours in the day. So if you get in the door first or foremost, you have a better chance of getting what you want.

That to me is a root of public anger today. Now, I never ran against Washington. I never believed you could run a campaign against Washington in order to go there and stay there forever. So I’m not going to say that Washington, whatever that means, that the government of the United States is massively corrupt. I’m just saying that there are corrupting influences all over our capital and they need to be rooted out.”

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Fiscal Policy Institute Executive Director Ron Deutsch

Full interview

 Deutsch on FPI’s proposed renewal and increase of the “millionaires tax” in New York State:

RD: “We used to have a tax system, prior to 2009, where the top rate of 6.85% was paid by anybody making over 40 grand a year. So, if you made 40 grand a year or if you made 40 million dollars a year, you were paying the same top rate of tax in New York and we thought that was absolutely ridiculous. … It’s not a progressive tax structure.

So we made some proposals to change that and the Legislature in 2009 adopted some higher rates. They’ve been reconfigured over the years, reauthorized over the years, but now we’re in a situation where the top rate is now 8.82% for people making over 2 million dollars a year. And we think that is not only reasonable, but actually should be a little bit higher.

We put forward our own plan that basically expands those brackets at the top end. And we basically start our top rate, or start increasing rates basically for people making over $665,000 dollars a year. That’s considered the top 1% in New York State. So if you’re making over that, we would basically say, ‘Hey, can you basically pay a little less than 1% more than you’re paying now?’ And then we have additional rates at a million to 2 million, 2 million to 10 million, 10 million to 100 million and above a 100 million. So the top rate we would seek would be about 9.9%. …

These new rates would not impact the quality of life of people who are in that income range. Paying a little bit more in taxes will really benefit society and will really not hurt those at the top as we know from what we’ve seen. … We had over 50 millionaires in New York State sign on to a letter saying … ‘Not only do I want to see the millionaires tax extended and not expire in 2017, but I’m willing to pay more than that and I can easily afford it if we’re going to put this much money into things like improving the quality of education, fixing our ailing infrastructure, fighting childhood poverty.’ The wealthy see those as quality of life issues that impact them and they’re more than willing to pay a little bit more in taxes to pay for that.”

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Deutsch on the chances of the millionaires tax passing in Albany:

RD: “I haven’t gotten any tremendously encouraging signs to the contrary. In fact, what they did this year was they did a middle class tax cut and kind of delinked it from the millionaires tax. So that could pose a problem and make it a little bit more difficult to get the millionaires tax extended or expand it, if you will. So we’re a little alarmed about that fact, but the reality is that this is going to expire at the end of 2017 and it’s going to result—if it expires and we go back to that 6.85% rate, that’s going to mean that the wealthiest New Yorkers are going to get a $3.7 billion dollar tax cut. …

You know all the arguments against us, right? ‘This is punishing success. … Folks are going to leave the state because they’re highly mobile.’ As a matter of fact, you saw that there was an article today that we were quoted in in the USA Today that quoted a Stanford study that basically showed that millionaires are not moving to lower tax states, right? They’re staying where they’re at, largely because they’re running successful businesses, because they’re linked to cultural institutions, philanthropic institutions. Their families are located here and they’re already rich. They’re not seeking economic opportunity.”

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Deutsch on how New York misspends the $8 billion it allocates every year to subsidizing economic development projects and how that money would be better spent covering the local share of Medicaid, which would, in turn, enable the counties to dramatically lower property taxes:

RD: “New York State currently spends about 8 billion dollars a year. That’s 8 billion with a ‘b’ dollars a year in the name of job creation by providing tax breaks, tax incentives, grants, what have you to private businesses.

The problem is with that 8 billion dollar a year system there’s very little accountability. There’s very little transparency. We’re really not being very good stewards of the public’s tax dollars the way we spend this money. And you see this time and time again where these programs get caught up in controversy that there’s fraud, there’s abuse, there’s pay-to-play scenarios going on. Even if that’s not happening, there’s the appearance that it’s certainly happening as we’re seeing right now being played out at the state level. …

I think the reality is that there’s better ways to spend this 8 billion dollars a year if we’re using it in the name of job creation. There’s much better ways to spend it. And I would suggest spending it on things like building the skill level of the workforce to prepare it for 21st century jobs and also putting that money into infrastructure repair is critical.

When you look at why businesses locate in certain areas, usually the two top things that they’re looking for are a skilled workforce and solid infrastructure to get their goods and services to market. So they’re not necessarily looking for a bucket full of money that the state provides in order for them to grow their business or move here or what have you. …

We all like to bang around the START-UP NY program which basically asks companies to come here and pay no taxes whatsoever for 10 years. We’re still waiting on a late report on the second year of the program. The first year of the program was, literally, an abysmal failure where it created about 76 jobs and we spent hundreds of millions of dollars advertising this program around the country but people aren’t utilizing it. So the reality is that we could be spending this money much, much, much more effectively. And if we’re looking to reduce taxes for everybody, we’d be better off using that money to pay for things that the state is requiring local governments to pay for now. So things like Medicaid, for instance. If the state were to use that 8 billion to pick up the local share of Medicaid, that would go a long way to freeing up dollars at the local level.”

Link to audio

Deutsch on whether it is accurate that New York is inhospitable to business:

RD: “I think any state could do more to help business potentially, but I don’t think that New York State is not friendly to business. And I think if you look at that report in particular (from the Tax Foundation, which ranks New York as 49th in the nation in business friendliness), it doesn’t look at things like the skill level of the workforce or the infrastructure. It just looks at taxes. …

Who did (the Tax Foundation) rank as number one? I think it’s North Dakota or Wyoming. I don’t see New York businesses pulling up stakes and flocking to Wyoming or North Dakota to relaunch their already successful businesses. We have a huge consumer population in the tri-state area. So businesses know that and they bank on that and that’s why they’re successful here. They’re not going to pull up stakes and move to Mississippi because Mississippi seems to have a lower tax rate. Even Mike Bloomberg, he pointed out that if a business is making a relocation choice based on taxes, it’s probably not a very good business model.”

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Deutsch responds to Bill Sameuls’ idea to create a tax break or tax incentives specifically for locally owned businesses in New York:

BS: “Now I have what I call another “Samuels idea.” What’s a “Samuels idea?” It’s something different, intriguing, probably not possible, but I’m still serious about the thought process. So let me try it out on you. …

 I’m very concerned as the mega-banks have taken over the local banks or major newspaper chains have shoved out the local newspaper and it has hurt the sense of community. It’s hurt people being tied to their towns and wanting to stay there. So my idea is to create a special tax break for certain businesses … that are wholly owned by people who live within proximity to that community, whether that’s Assembly district or State Senate district. And they get a special tax break that a multinational that’s coming in to eliminate a lot of local jobs and when profits are made they take them out of the community. All of this is based on a philosophy that says our tax structure in New York should encourage a sense of community and cohesiveness and neighborhoods. Besides saying it’s a wild idea (that) makes no sense, do you have any reaction to this “Samuels idea?”

RD: “I love all “Samuels ideas.” I can’t help myself. But I have to say, I think in terms of trying to do what you’re talking about, I think we could do something similar to that, but really look at helping small, local businesses thrive in our communities, right? I mean, so many of us depend on our small, local corner store… So let’s try and make it easier for them. And we can do things like providing greater and easier access to credit. We can provide training … we can provide tax breaks. And remember, when you’re talking about small businesses, as you well know, Bill, it’s the property tax that hurts…”

BS: “Yeah. It kills it. It just kills it.”

RD: “That tends to be the largest tax that they pay. So again, if we used our economic development pool of money, that 8 billion dollars, to offset some of the property taxes, that would benefit all businesses.”

BS: “And create businesses and create new businesses.”

Link to audio

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