Aug. 17 (Bloomberg) -- Anti-tax advocate Grover Norquist said in an interview on Bloomberg Television’s “Political Capital With Al Hunt,” airing this weekend, that Republican vice presidential candidate Paul Ryan would influence economic and tax policy if Mitt Romney wins the White House much the way former Vice President Dick Cheney helped guide national security matters during George W. Bush’s administration.
(This is not a legal transcript. Bloomberg LP cannot guarantee its accuracy.)
AL HUNT: We begin the show with the president of the Americans for Tax Reform and author of “The Taxpayer Protection Pledge,” Grover Norquist. Thank you for being with us, Grover. You were -
GROVER NORQUIST: Sure.
HUNT: - pleased about the selection of Mitt Romney’s running mate. Let me ask you this. What do you find more appealing - because there are at least a few differences - the Romney or the Ryan economic budget blueprint?
NORQUIST: The advantage of the Ryan plan is that it’s been scored by CBO, it’s been written down. The entire Republican caucus in the House and Senate has vetted it, can speak to it, has voted for it once, so it’s sort of been through the process.
NORQUIST: The presidential candidate, Romney’s, proposal is a fine one, 20 percent across the board. I think what we’ll get is something like what Jack Kemp and Ronald Reagan had in 1978 to ’81, which was Reagan endorsed Kemp-Roth, and then the final package was the Reagan tax cut, but it was built around the idea -
HUNT: So you would expect Romney to basically embrace Ryan, and it’ll be the Romney tax cut?
NORQUIST: With rough edges taken off and changes here and there.
HUNT: Do you worry that Mitt Romney is distancing himself a little bit over the last four or five days from Paul Ryan’s budget?
NORQUIST: Well, I think quite correctly, if you’re running for president, you want to say this is what we’re looking to do, but to get nailed down to - I mean, the bill’s quite long, it’s quite detailed, is there something in there that -
HUNT: So that’s proper?
NORQUIST: - that he would not want to buy into? Possibly.
NORQUIST: But the thrust, he’s made it clear. He’s - he’s for moving in that direction.
HUNT: Let me ask you this. There’s a debate among some people who know Romney well, how would he govern if elected president, the rather pragmatic, solutions-oriented governor of Massachusetts, or the conservative candidate for president? Do you feel that Paul Ryan, as the vice president, would be more likely to deter any impulses to get wobbly if he’s -
NORQUIST: Well, I would argue the difference in Massachusetts, he was governor for four years. During the entire four years, the Democrats in the House and the Senate in the Massachusetts legislature had more than 80 percent of the seats. So when he was -
HUNT: So it’s not analogous to -
NORQUIST: No, because he was playing defense. He was a goalie. The other team took shots on goal all day.
HUNT: You don’t think he needs someone like Paul Ryan there to stop him from -
HUNT: - or argue strongly against going for compromise?
NORQUIST: No. When - when you’re playing defense and you’re - you’re the goalie, the best you can do is stop shots on goal and come to some accommodation, because you have to have a budget. He’s going to get elected with a Republican House and Senate and be able to move forward an agenda as opposed to play defense.
HUNT: Do you have any sense that Paul Ryan, given his experience and expertise in the economic area, would be a domestic economic equivalent in the Romney - Romney administration, say, to Dick Cheney on national security in the Bush administration?
NORQUIST: Absent Gitmo, yes. I think that he would certainly have a large footprint. I was actually publicly an advocate of not having Ryan be the vice presidential nominee, not because I don’t think Ryan’s key or important, but because I think he’s so key and important.
HUNT: But you were still pleased with the pick? I mean (inaudible)
NORQUIST: Oh, yes. No, no, I wanted him to stay in the House and run the Romney-Ryan plan through the House and the Senate, because I thought that was so important. So -
HUNT: But you see - let me make sure I’m right on this. You see him as playing - again, we’re talking on economics and taxes, not national security -
HUNT: - as playing the sort of role in that area that Cheney did in the Bush 43?
NORQUIST: Similar, although, remember, Cheney designed the ’83 tax cut, too, and that was -
HUNT: But that wasn’t -
NORQUIST: - Cheney put together -
NORQUIST: I’m sorry. I’m sorry. I misspoke, 2003. The 2003 tax cut was Cheney’s (inaudible)
HUNT: Yeah. Let me - you have always had an interest in the Middle East. What did you think of Governor Romney’s comment when he was in Israel that the Israelis are economically superior to the Palestinians because of cultural differences?
NORQUIST: Well, I think he was doing several things, and he mixed up a couple of different books. He talked about “Guns, Germs and Steel,” which has actually the opposite case, so I’m not quite sure how he put those together. What happens is policy matters, property rights matters. If you want to know countries that succeed, they have property rights and rule of law. That’s one thing that you don’t have in the countries surrounding Israel and that is denied to the Palestinians.
So it was an odd place to make that case. If you wanted to argue that property rights matter and rule of law matters, yes. I don’t know if that’s culture. I mean, go back 20 years, the Israeli economy pre-Netanyahu’s economic reforms was not doing very well. The culture didn’t change. The tax code changed, and the regulatory base changed, and the rule of law changed -
NORQUIST: - and got better in Israel.
HUNT: You have a lot of members, the vast majority of Republican members of Congress who have signed your tax pledge. But the other day, the American Enterprise Institute, a cathedral of conservativism in this town for some at least, wrote that many Republicans, particularly those pro-defense Republicans, are, quote, “tuning Grover Norquist out.”
NORQUIST: AEI said this?
HUNT: AEI, yeah, on their website.
NORQUIST: Oh, somebody at AEI said this.
HUNT: Yeah. Yeah.
NORQUIST: OK. One, they’re wrong. And, two, there was an effort by a couple of people to say, let’s raise taxes to avoid the sequester. Here’s the challenge with that. Were you to raise taxes to try and buy more spending for national defense, the Democrats would insist that you have to buy them $2 worth of social welfare programs for every dollar you got on defense.
HUNT: So that’s just a tradeoff that you say is absolutely unacceptable?
NORQUIST: Well, it’s not necessarily for me to say it’s unacceptable. The House and the Senate find it unacceptable. But more importantly, the leadership in the House and the Senate that wants tax reform realizes that if you go in and take deductions and credits and give them to the appropriators, they’re not available to the tax writers at Ways and Means and Finance to reduce marginal tax rates.
HUNT: Grover, you - one of the people who signed your pledge is Lindsey Graham, who said the other day that we have to raise revenues by closing loopholes or raising fees. And then on his old pledge, he said I’ve crossed that Rubicon.
NORQUIST: I had a conversation with him about that, because I was saying, what were you thinking? And he has this imaginary unicorn that he hopes to reach, and that is the Democrats giving him trillions of dollars of - in a lockbox - trillions of dollars of entitlement reforms, less spending, in which case he’d trade a teeny tax increase for that. I suggested that that’s not - does not exist in the real world. It is like unicorn in that. And he said you may be right.
So if he wants to go out and look for unicorns, he can have that conversation. But he’s - he’s going to be lonely out there, because there are no Democrats and no Republicans in that zone.
HUNT: Do you think that any - any budget deficit deal early next year, with a Republican administration, will include no net revenue increases?
NORQUIST: Correct. And, remember, that’s what happened two years ago, after the Republicans won the House, not the Senate and not the presidency. They just had the House. Democrats came in and continued all the Bush tax cuts, plus AMT reform and the other - the patch and so on.
HUNT: So let me just go - you think there will be a deal next year, some kind of budget?
NORQUIST: There will be a budget.
HUNT: There will be a - there will be a budget deficit and a long-term deficit reduction deal -
NORQUIST: It’ll look like the Ryan plan. It will not have a tax increase in it.
HUNT: If Obama should win a narrow re-election, what would the budget fight look like next year?
NORQUIST: Look an awful lot like what it did for the last two years, which is a Republican House and, I believe, a Senate saying we’re not going to raise your taxes and we’re not letting you spend the money you want to spend.
HUNT: OK, Grover Norquist, thank you so much for being with us. You have been called the most powerful man in Washington, even more powerful than Bryce Harper, but he is in a hitting slump, I’d have to point out, Grover.
NORQUIST: And we’ve stopped every tax increase.
HUNT: Hey, thank you very, very much. And when we return, Paul Ryan enters the fray. Bloomberg reporters are next.
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