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Gop Hopefuls Try To Flatten Forbes’ Tax Plan Rival Candidates Band Together To Slam ‘Nutty Idea’ At Debate

Sun., Jan. 14, 1996

With the clock ticking toward the first voting in the 1996 presidential campaign, Republican candidates came out swinging in a bare-knuckle debate in Iowa on Saturday, with most aiming at millionaire publisher Steve Forbes and his flat-tax proposal.

Lamar Alexander, the former Tennessee governor, led the attack, calling Forbes’ flat tax proposal “a truly nutty idea in the Jerry Brown tradition,” linking his rival to the liberal former California governor who pushed the flat tax in his 1992 run for president.

Alexander said adoption of Forbes’ version of the flat tax would cause a “real estate crash” because it would eliminate the tax deduction for mortgage interest. He also said it would end hopes for a balanced budget by reducing revenue.

The Forbes tax plan would exempt families from paying federal taxes on the first $36,000 in income, and impose a simple 17 percent tax on income over that amount.

Sen. Phil Gramm of Texas accused Forbes of failing to support Republican attempts to balance the budget, commentator Patrick Buchanan said the Forbes tax plan “looks like it was worked up by the boys at the yacht basin,” and Sen. Bob Dole joined in the verbal mugging by joking that the government could “always borrow money from Steve Forbes.”

Even Morry Taylor, a long-shot businessman, went after Forbes. Under the Forbes approach, Taylor said, he would pay no taxes on $15 million in capital gains while workers in his wheel factories paid 17 percent of their wages. “That’s not fair,” Taylor said.

There were also clashes between Dole and Gramm, but their disagreements were eclipsed by the intensity of the criticism of Forbes.

The concerted assault on the wealthy magazine publisher, who is making his first political bid at the highest level, reflected a growing concern among members of the Republican field that Forbes’ heavy spending on television advertising is buying recognition.

Forbes has been running second, behind Dole, in statewide polls in Iowa and New Hampshire.

“In many ways, it’s a recognition that this is turning into a race for second place in Iowa,” said state GOP Chairman Brian Kennedy.

“It’s a concession by the other candidates that Steve Forbes is a serious player and is in the hunt for second place in Iowa.”

Forbes kept his composure during most of the 90-minute program, sponsored by the Des Moines Register, and called the attacks “diversions” by politicians “who can’t stand the idea of taking away their principal source of power” - taxation.

And Forbes showed no signs of backing away from the flat-tax idea, bringing it up repeatedly during the debate, even in response to unrelated questions.

Asked what he would do to preserve the student loan program, Forbes said his flat tax would allow Americans to increase their own savings for education.

This prompted Alexander to observe, “This flat tax is going right up there with the Great Pumpkin. It’s going to solve every problem we have.”

During a discussion of balancing the federal budget, Alexander boasted that he had balanced budgets in Tennessee and then told Forbes, “Steve, the only thing that you’ve ever run is a magazine you inherited, and you raised the price.”

Somewhat feebly, Forbes replied that subscriptions to Forbes magazine were voluntary, but “taxes are not.”

All of the attention focused on Forbes allowed Dole to glide through the debate with little apparent damage to his front-runner status.

Dole, in his third presidential bid, is so far in front of the nine-man field - a new Time magazine/CNN poll says he is the favorite of 42 percent of registered Republicans nationwide, with Forbes second at 9 percent - that the Iowa event on Feb. 12 is really a fight for the runner-up slots.

Gramm was his most persistent critic, accusing Dole of backing away from the GOP’s strong anti-abortion stance and asserting that the Senate leader had “lost his nerve” during the budget negotiations with Clinton.

“Bob, is there some kind of secret deal you’re cutting with Bill Clinton?” Gramm demanded to know.

Dole shot back: “Next time you’re in town, look me up.”

The political junkies in the audience roared with laughter, recognizing Dole’s point: He runs the show, while Gramm has spent so much time on the political hustings that he now has one of the worst Senate attendance records.

Dole was not done. He turned to his next questioner, a high school student, and said he wanted to hear from her, because “she’s passed every grade she’s ever been in” - sparking gasps from those who knew that Gramm failed third, seventh and ninth grades.

Gramm later pointed out that he earned a doctorate in economics with the help of “a loving mother.”

The exchanges enlivened a rare face-to-face encounter among nine GOP candidates that was televised by CNN Saturday, a month before the Iowa caucus, on Feb. 12.

During the first half-hour, the dialogue was tentative, as the candidates recited set pieces from their own campaign speeches, often answering questions with non sequiturs.

Sen. Richard Lugar of Indiana took the most diplomatic stance. He repeatedly advocated economic growth measures and refused to join in the scuffle that surrounded him.

He urged the abolition of the income tax and the Internal Revenue Service. He wants a 17 percent national sales tax on goods and services instead.

Former state department official Alan Keyes, the most stirring stump-speaker among the candidates, spotlighted the centerpiece of his campaign: strengthening the “marriage-based, two-parent family.”

On how to heal racial divisions, Keyes, who is black, said: “Well, gosh, I’m tempted to say that the most important thing I can do to improve the racial climate in America is get elected president of the United States.”

California Rep. Bob Dornan drew laughter when he rebutted Taylor’s claim that the politicians on the stage were “walking around” the issues.

“This is Braveheart here,” Dornan puffed about himself. “Candid forceful, and straightforward. Brave, courageous, steadfast and loyal. I know you didn’t mean me, Morry.”

Dornan labeled Clinton “a pathological liar.” He also said he believed the accusations of Paula Corbin Jones, the former Arkansas state employee who has charged then-Gov. Clinton with sexual harassment.

“I think we have a criminal in the White House,” Dornan said.

xxxx Flat tax catches flak Republican candidates’ comments on the flat tax during Saturday’s debate in Des Moines, Iowa: Steve Forbes. “Every time we reduce the tax burden on the American people, not only has America moved ahead … but also Uncle Sam, Washington, has collected more revenue.” Most politicians “can’t stand the idea that I’m going to take their principal source of power and give it back to the people” with a 17 percent flat tax. Lamar Alexander. “The Forbes tax plan is a truly nutty idea in the Jerry Brown tradition.” He said it could hurt farming with the loss of inheritance tax breaks, wipe out charity deductions and hurt middle-class Americans, while giving richer taxpayers greater savings. Pat Buchanan. Forbes’ flat tax plan “looks like one worked up by the boys at the yacht basin” because rich Americans would gain. Buchanan’s 15 percent flat tax plan would retain mortgage-interest and charitable deductions and increase personal and dependent deductions. Phil Gramm. “Steve is for a flat tax, so am I.” Gramm advocates a 16 percent flat tax while retaining current mortgage-interest and charitable deductions. Bob Dole. Didn’t directly address Forbes’ flat tax plan, but has called it a “risky” proposition. Dole said he supports “tax cuts for family with children” by revising the current tax system and advocated providing greater estate tax relief. Alan Keyes. Rejected the idea of a flat tax, saying he wants to “abolish the income tax system” in favor of a national retail sales tax that “gives people control over the money they earn.” Richard Lugar. Rather than support a flat tax, he advocated “the abolition of the income tax and the Internal Revenue Service.” He wants a 17 percent national sales tax on goods and services instead. This, he argued, would “make certain our economy grew,” give more tax relief to families and “shift from taxation to consumption” to finance government. Morry Taylor. Forbes’ flat tax “is nuts.” He said he would have paid zero taxes on his $15 million in capital gains last year under such a plan, while his middle-class employees would get no such tax break. Bob Dornan. Didn’t address the issue. - Associated Press

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