Gingrich Assails Perry on Oil Incentives
PELLA, Iowa – At a forum where they largely agreed on fixes to the sputtering U.S. economy, former House Speaker Newt Gingrich and Texas Gov. Rick Perry parted ways on the need for wind-energy credits, important in the blustery Hawkeye State.
Speaking to reporters after the event, Gingrich took a swipe at Perry and his assertion that the government should not pick economic winners and losers. Gingrich asserted that supporting incentives for the oil industry, as Perry does, is a form of economic favoritism. “Nobody who comes from oil country seems to think that any of that is picking winners and losers,” Gingrich said of oil-industry tax incentives. “And all of [the rival candidates] oppose Obama’s effort to get rid of it. Suddenly they find wind is [picking] winners and losers.”
Gingrich and Perry are locked in a battle for the support of conservatives who dominate the first-in-the-nation caucus, a demographic segment that currently favors businessman Herman Cain but could be up for grabs if the former pizza executive sustains serious political damage in an unfolding sexual-harassment scandal.
Gingrich, the speaker of the House in the mid-1990s, was the only candidate at the forum to say he supported continuing the wind credit. Each of the others supported a gradual phasing-out of energy tax incentives. Also attending the event, sponsored by the National Association of Manufacturers and moderated by Iowa Gov. Terry Branstad, were Perry, Rep. Ron Paul of Texas, Rep. Michele Bachmann of Minnesota, and former Sen. Rick Santorum of Pennsylvania.
Republican front-runners Cain and Mitt Romney, the former Massachusetts governor, skipped the conference, Romney to raise money in private meetings with New York City business leaders and Cain to court national movers and shakers in Washington. The remaining candidate, former Utah Gov. Jon Huntsman was campaigning in New Hampshire, which he has made a make-or-break state for his bid.
Branstad, along with Tom Hudson, co-anchor of PBS’s Nightly Business Report, quizzed the candidates about a variety of economic topics, including reducing job loss, restructuring the tax code, encouraging domestic energy production, and handling the health care system.
The contenders were in broad agreement on solutions to the current economic woes: lower taxes, fewer regulations, more domestic energy production, and repeal of President Obama’s health care initiative requiring individuals to have insurance.
“I do not think it is the federal government’s business to be picking winners and losers, and, frankly, in any of our energy sources,” Perry told the crowd. He said he would eliminate federal subsidies for energy exploration and production with the exception of research-and-development tax credits, leaving other incentives to the states.
Gingrich said he supports incentives for all U.S. energy systems as a means of achieving energy independence as quickly as possible. “I think it’s an enormous national-security asset to be able to break free from Venezuela, Saudi Arabia, Iran, and Iraq,” he said.
Another area of disagreement among the candidates was the level at which corporations should be taxed to return, or repatriate, profits that are currently kept overseas. Gingrich, Paul, and Bachmann fully supported allowing companies to bring the money back into the United States without being taxed. “That’s their money,” Bachmann told the crowd.
But Santorum took a more nuanced approach, arguing that tax rate should be zero only for companies that agree to invest the money in manufacturing and job creation, and slightly higher for all others. Santorum also argued that a renewed focus on domestic manufacturing would provide new opportunities to those at the bottom and the middle of the income spectrum.
“We don’t need a trade war with China,” Santorum said. “We need to beat them.”
Each of the candidates used the forum as an opportunity to talk up their various tax proposals, with Perry and Paul calling for a flat corporate-tax rate. Perry would set his at 20 percent, and Paul called for a flat rate of 15 percent. Santorum said he would favor a zero percent tax rate for people who created jobs in America. Bachmann didn’t offer specific numbers but instead called for a “flatter, fairer, and more simple” tax system.
Gingrich offered a list of taxes he favors eliminating, including the capital-gains tax, double taxation on dividends, and the estate tax.
The forum was the first of two major events in Iowa this week for the Republican candidates. The second is the Ronald Reagan Dinner on Friday in Des Moines. Skipping the event again will be Romney and Cain.
