NASHUA, N.H. (AP) – Republican presidential candidate John Kasich on Thursday pledged to balance the budget within eight years, cut taxes and pour more money into the military, while holding the line on all other government spending.
The Ohio governor wants to cut taxes on businesses and the wealthy, but make more generous a tax credit aimed at lower-income people. His plan also would dramatically scale back Washington’s role in doling out education and transportation dollars.
Kasich’s domestic agenda for his first 100 days as president is not as aggressive of some more conservative rivals. But he predicts it is one that will draw 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 at Nashua Community College. “It starts by setting your priorities and then having the courage to make choices that might be unpopular.”
Kasich, 63, is fighting to stand out in a packed GOP field and in an election season where political outsiders are celebrated. His resume includes 18 years in Congress and two terms as governor in an important swing state.
Yet his blunt style resonates with some voters, particularly in New Hampshire, the unofficial staging ground for his campaign.
Kasich advocated tax cuts that would increase the budget deficit over the early years of his presidency, according to projections his campaign shared with The Associated Press.
Here’s what his advisers predict: enough economic growth from those cuts, and backed by reductions to Medicare and Medicaid and an eight-year freeze on increases in nondefense discretionary spending, to eventually offset lost tax revenue. All that would help balance the 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.
-cap the long-term capital gains tax rate at 15 percent, helping those in the highest income tax bracket.
-eliminate the estate tax.
-lower the top business tax rates from 35 percent to 25 percent.
-double the research and development tax credit for small businesses.
-increase by 10 percent the earned income tax credit, which is intended to help lower-income taxpayers.
“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.”
In an interview before his speech, Kasich said, “If you are a person that thinks you ought to pound the rich into submission, I guess you won’t like the plan.”
On spending, Kasich would limit the federal role in education, transportation, job training and Medicaid. Dollars now dedicated to those programs would go into large grants for state leaders to manage.
“I’m sending all the programs in the federal government back,” he said.
For now, Kasich is ignoring two major programs, with specific ideas to come later on President Obama’s health care law and Social Security.
He does propose cuts to Medicare that would slow the growth rate of the health care program for more than 50 million elderly and disabled people.
One of the only spending increases he is pitching would go to the 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 Kasich’s commitment to fiscal conservatism after he expanded Medicaid eligibility in Ohio as part of the federal health 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 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.
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