Daniels Says Republicans Must Specify Deficit Cuts

Republican Governor Mitch Daniels of Indiana said his party’s presidential candidates must get specific on how they would reduce the federal budget deficit, suggesting that has to include tax increases.

“It is time for candidates to, I believe, propose specific remedies or steps to address this very, I think, survival-level issue,” Daniels said in an interview on Bloomberg Television’s “Political Capital with Al Hunt,” airing this weekend. “It threatens the essence of the American promise, upward mobility.”

He said “it’s a great opportunity for our party to speak more openly and inclusively.”

Daniels said President Barack Obama was “completely AWOL” on closing the $1.3 trillion deficit, and while the Republican presidential candidates “have spoken more forthrightly” than the president, they haven’t done so “nearly to the extent that the moment requires.”

Daniels, 62, also said that the differences between the top contenders for the Republican presidential nomination aren’t great, even as former Massachusetts Governor Mitt Romney emphasizes economic issues and former U.S. Senator Rick Santorum of Pennsylvania focuses more on social issues.

Entitlement Programs

Deficit-reduction talks deadlocked in Congress last year as Democrats pushed for raising taxes on higher-income Americans while Republicans insisted on cuts in spending on Medicare and other federal entitlement programs.

Daniels said any deficit-reduction package would include “modernizing the entitlements” and “greater revenues.” Overhauling entitlement programs should include changes that would result in more benefits flowing to the neediest Americans, he said.

“Everyone, starting with the most affluent, must participate in this,” Daniels said. “There are smart and dumb ways to do that. My strong encouragement is for closing tax loopholes and stop sending benefits that really should be concentrated and preserved for the most vulnerable among us.”

“The pain and sacrifice is going to come through inaction, not the -- I think -- reasonably moderate steps” lawmakers could start taking now, he said.

Nomination Contest

Daniels, who declined to run for president this year, dismissed suggestions from Senator Jim DeMint of South Carolina that the party’s nominating convention could turn to him if none of the candidates had a majority of the delegates.

He said someone would get enough delegates before the national convention in Tampa in August, and while he didn’t know when that would happen, he said he was “rooting for it” not to occur until after the May 8 Republican primary in Indiana.

Daniels said Romney at this point would be favored to win the state’s primary, though “each of the current candidates would arrive with some chance to be competitive.”

While Romney and Santorum continue to attack each other and compete for delegates by emphasizing their differences, Daniels said, “They’re more similar in views and outlook than they let on, or the dynamics of their running against each other allows them to show. I don’t think that the differences are nearly so wide as is sometimes perceived.”

Indiana Republicans also have a primary for U.S. Senate, where incumbent Richard Lugar faces a challenge from state Treasurer Richard Mourdock, who is backed by Tea Party groups. Lugar, who lives in northern Virginia, was ruled ineligible to vote in his home precinct in Indiana, a decision that doesn’t affect his eligibility to run.

Daniels called the election board’s March 15 decision “partisan mischief” by local Democrats and said he expects Lugar, who was first elected to the Senate in 1976, to prevail.

“I do believe he’ll win,” Daniels said. “He’s still a great asset to this state and to the country.”

Before it's here, it's on the Bloomberg Terminal. LEARN MORE