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A Times-Mirror conversation with Sen. Mark Warner

Sen. Mark Warner (D) at his Washington D.C. office. Courtesy Photo/Office of Sen. Mark Warner
In mid-July, the Times-Mirror sat down with former governor and second-term Sen. Mark Warner (D) at his Washington office for an interview that hit on budgeting and sequestration, the “gig” economy and why Warner believes capitalism is no longer working for the middle class. Here's a transcript from the conversation, lightly paraphrased for clarity and grammar.

LTM: Let’s say Congress can get only one thing done this year. What do you think it should be? How do you get there?

Warner: A budget deal that avoids sequestration. We get there the same way we should’ve gotten there three years ago -- tax reform and entitlement reform. You can’t get there with more fiscal flim-flam. You can’t get there with phony deals. Dealing with sequestration means you also have to deal with highways because they're inter-related.

The cupboard is bare in terms of cutting defense or education or infrastructure or research money. Unless you want to substantively make America less competitive, until you get to revenues and entitlements, you know, follow the money -- the money is either in the revenue side or the entitlements side.

When will there be a significant, serious dialogue or action when it comes to tax reform or entitlement reform?

Well, I think we got pretty serious with Simpson-Bowles and the Gang of Six.

"But, you won’t have the political will unless you can also deal with the revenue side. America, right now, out of the 34 OECD (Organisation for Economic Co-operation and Development) countries – all our competitors -- we’re 32nd in the amount of revenue we collect."

Yes, our corporate tax rate is too high, but America is the least-taxed industrial nation in the world, yet we still expect first world services.

I’m not saying we have to go to a European model or a Canadian model, but I am saying you have to deal with the revenue side as well as entitlements.

Do you feel talks break down more on the revenue side or the entitlement side?

I’ve actually always felt revenue is the biggest challenge. Because you have this -- and I think his influence is waning -- but the stupidity of these “No New Tax” pledges gives you no room to maneuver.

Somebody may say they want to protect entitlements, but at least you can back-door get into those discussions by raising the cap, or people will talk about health care cost reforms. There are ways to get into it. As opposed to this [no new tax] bright line that is just ludicrous.

I mean, if America was second instead of 32nd out of the top 34 nations, having a bright line would make some sense. But when you’re 32nd out of 34 OECD nations, and then you say we want to still have world-class roads, education and military, you don’t have to have more than a grammar school math education … Particularly when you also are layering on our county which no other industrial nation in the world is layered with, which is basically a military cost that asks us to protect the rest of the world.

Who are some of your favorite Republican colleagues to work with on issues like this?

Bob Corker is one of my best friends. He’s a great guy. Mike Crapo from Idaho is a very good guy. Susan Collins, John Hoeven. They get it. They don’t get caught in the box.

I do worry, at times, the Democrats have seen the success of ideological litmus tests on the right, and I worry Democrats will say, “Well maybe we ought to do our own on the left? Oh, gosh, no tax pledge means well maybe the Democrats should have a never touch Social Security or Medicare pledge.” Both of them lead to the same place, the same cul de sac.

What’s an issue you feel like isn’t getting enough press? Maybe a “Warner project” you'd like to talk about?

"Well, Loudoun County is kind of in the epicenter of this. It's this whole notion of the 'gig' or 'sharing' or 'on-demand' economy."
There are more and more people by choice and by economic necessity going to these places where you can monetize your time whether it’s with Etsy or Task Rabbit or Handy or your car with Uber or Lyft or your apartment with AirBnB. There’s a lot of freedom and financial rewards coming from this kind of growth in the economy, but there’s no safety net. There’s no retirement, there’s no unemployment, no workmans' comp, there’s no disability. So how do you allow this innovative piece of the economy to grow and not impose a top-down government solution on it? But also say, hey, it makes no sense if somebody is making six figures and then when stuff hits the fan, they go from doing well to being back on government assistance programs because there's no safety net in-between?

At this point, you just seem to be starting the conversation on this, to get it in the minds of fellow lawmakers.

Right, and recognizing that the problem isn’t going to be solved by calling people either employed or unemployed or an independent contractor -- the old 20th Century description. That doesn't work. What I’m arguing is, does this model around the health care exchanges, could you have an unemployment exchange or a workmans' comp exchange? Maybe. Could you have what the building-trade unions use to have, with a third-party independent fund with an hour bank? For every hour you work you deposit a little bit in that fund.

Tell me about a few bullet points or good ideas you’re hearing on this.

I'm hearing from a lot of companies. Brian Chesky, the CEO of AirBnB, he wants to do the right thing. They’ve added a million dollar policy for people who rent out their homes, they’ve created a co-op for people that clean the houses afterwards. The millennials -- 83 million strong, the largest age cohort -- they want to be socially responsible. They want to buy from socially-conscious farms, so that’s really cool. They’re the most diverse, most open to technology, most disruptive generation. So, I don’t want to squash the innovation coming out of these platforms. But, how do you start offering some benefits here? Somebody who’s making $100,000-plus in the gig economy ought to be putting some aside and the platform ought to be putting something aside, so there's some safety net.
"What the cool thing about this is, I have no idea whether this a Democrat or a Republican issue. This is future-past, not left-right."

I'm working on: How do you make capitalism work low- and moderate-income Americans again? Something is wrong in our country if you’re working full-time and you’re still on government assistance. So – and this one I have a lot more work to do – is there a way to not simply have a government program that's going to redistribute? How do you actually incent a corporation to pay fair enough that keeps an employer off government benefits? I think there's a way to do that.

The traditional capital-labor imbalance, where, growing up as a kid, there was an abundance of labor and shortage of capital, so you had to reinforce capital – you had capital gains tax, depreciation, interest deduction. Well, in America now, we have plenty of capital, we have shortage of qualified labor. So how do you re-balance that? These are ideas that fall into the “Warner projects” that may not be a bill tomorrow, but if you can come up with the safety net for the “gig economy,” and making capitalism work for low- and moderate-income workers, that would be pretty cool.
Times-Mirror Photo/Trevor Baratko

Do you worry about critics saying these are “Washington” solutions?

Well, on the sharing or gig economy, what you don’t want to have is 500 different lawsuits with a whole quilt work of rules. So that’s why I’m not trying to say here’s the Washington-based answer. I’m listening, I’m trying to talk to folks. But I think you’re going to find a lot of these platforms are going to want some level of “best practice.” And they’ll do their share, but it has to be done in a 21st-Century fashion.

On the capitalism issue, it’s harder, but I have a couple foundations I’m working with that are willing to think in a different way. If you work full time, you shouldn't have to be on government assistance.
"Capitalism is working for some people really well -- and I say this as a proud capitalist -- but I really worry the constant focus on short-termism in capitalism, quarterly profits over everything else , could kill capitalism."

Elaborate on that.

With the velocity of money, people being investors who are only focused on short-termism, too often you can squeeze a quarterly profit out at the expense of a long-term value proposition.

It’s kind of what our government is doing. By going simply in debt, and not investing in our roads, at some point you pay the price for it. It’s the same thing that says, if I’m a company and I’m not investing in a new plant and equipment for my workforce because I can squeeze a better quarterly profit. If all you’re getting judged on is short-term results, that doesn’t lead to a long-term value proposition.

There is a growing recognition from a number of CEOs that, if we’re not careful, this could destroy capitalism. Capitalism is about long-term value creation, and that’s being undermined.

Then our political system ends up being a cartoon almost. One party is for government redistribution, the other is for unfettered capitalism with no rules. Neither one of those work in the 21st Century.

There’s almost the political dynamic of short-term payoff with primaries and candidates playing to their base.

Right, “I’m going to make crazy promises to win the primary, to heck with the fact of how I win the general election or how I have to actually govern.” This short-termism has definitely crept into the political system.

Let's talk about Hillary Clinton quickly. Comment on her campaign.

I support her. I think she’s a strong candidate. The challenge that she will have is to position herself as kind of forward-leaning, future-leaning. She obviously has as much experience as anybody who has ever run for the job. That has enormous value. But I think she also has to be kind of a voice for positive, future-leaning change.

She has to not get caught, as some in the Democratic Party, who want to go more toward traditional 1960s models with redistribution only. The 1990s models was more about growth versus redistribution. “We're going to grow the pie.” It was more about growth. I’m a growth advocate. It’s why I’m for trade. It’s why I think growing the pie is better than just dividing it. Now I think the pie has to be fair.

Bernie Sanders is getting a lot of traction. You have now five candidates on the Democratic side. I imagine it's going to get rough and tumble. It may not be the food fight you have on the Republican side. Many of my Republican Senate colleagues who are friends, they just shake their head when they think about it.
"I guess I'm still old fashioned in a sense, I think the country does better when you have two centrist candidates fighting over the middle."


Contact the reporter at .(JavaScript must be enabled to view this email address) or on Twitter at @TrevorBaratko.


Lawman, you’re going to scream? Liberals come out of the womb angry and screaming. You and your your Occupy Wall St. slackers will continue to vote for Dems. Doesn’t matter what happens between now and elections.  Why? It ain’t rocket science.

1) you want free stuff
2) Dems promise you free stuff
3) you blindly and robotically vote for Dems

@workhardgetahead, like many Chickenhawk Republicans, you probably weren’t in Iraq, I was there and it was a fiasco.  Now I am I guess technically in the 1% and my tax bill is less, but, folks I know that are not in the 1%, their tax bill never seems to go down.  Check your dictionary for the definition of a “FACT.”

1% and Iraq Fiasco = Liberal Democrat talking points

First @workhardgetahead, you do know that marijuana use is still illegal in Virginia and not a good thing to use when writing comments.  Besides that Knucklehead in Kansas and you see how that is turning, what Republican ever lowered taxes for anyone but the 1% and strong defense, like that Iraq fiasco.  Second @jplegend, minorities did not come out in 2011 in Loudoun and 2014 in the National elections.  Problem is that Democrats are too dense to see the trend.  2008 and 2012, minorities come out president wins largest number of votes in the history of this Country.  Off years, ignore minorities, lose everything.  This time we will make it a little more vocal so that even you and the Democrats can connect it with crayons.

I had to chuckle at Lawman’s comment about a day of reckoning for Dems….as though minorities might not vote for them. That’s great comedy. I’m sure the Dems are quaking in their boots. Minorities wake up and go to sleep voting for Dems. Sure the Dems take them for granted. Why shouldn’t they? No matter what they do or don’t do, they’ll get the minority vote. Definition of insanity…

Lawman, your comment regarding the GOP and minorities is totally false. How does the GOP screw over minorities? By lowering taxes? Maintaining a strong military? Please explain what you mean.

Defund planned parenthood, Mark!
The total to 348,869 services performed that are specific to pregnancy and 327,166 were abortions.

So, what percentage of these pregnancy services were abortion services?

A whopping 93.78%.

If 1000 pregnant women walked into Planned Parenthood, 62 women will give birth to a child and 938 will have an abortion.

Not question or answer on one issue dealing with diversity, race or inequality.  No Democrats wins a State side election in Virginia without the minority vote, but, as soon as they get that vote, its off to take care of the people who do not even vote for them With Republicans, you understand them screwing over minorities, its in their DNA and we don’t vote for them, but, Warner, Kaine, McAuliffe and Herring all owe their elections to minorities coming to the polls.  Look at their staffs, their advisors and their campaign teams, few if not any minorities.  A day of reckoning is going to come for Virginia Democrats and their Dick Saslaw Plantation keep the minorities in their place mentality.

Orbital, 20 million in pork spending, Ex Im boondoggle, we could of had Gillespie, egads!

Wow! Hard hitting questions, Trevor.
Ask him about his support for Planned Parenthood?

Mark Warner thinks Hillary Clinton is a strong candidate? I can’t believe we elected this tool.

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