all right. we'll start over here. >> hello. my name is lateresa jones, and i'm from florida. i'm running for u.s. senate in 2016. my concern -- i actually came here today because i am going to run as an independent. and i came because we need a support system behind us strong enough to help us because some of us do strategize. i like a lot of the people are fed up because a lot of us i believe in ordinary people because that's what this country was built on, ordinary people. and that is the reality of it. people are hungry out here. they want layman's terms. they want things -- they are open to ideas, but i think the way we present it to them as well it makes a difference. they have to feel a part of who we are. i've actually connected with the libertarian party also because in florida for charlie crist to

come out of a republican side to the independent side and get almost, what 28% of the votes in the indindependent, it's a swing state. i'm asking you all, i know i need your support. in lawwise across the board, but this is about a movement. and i'd like to know where else can we go as candidates, as independents, democrats or republicans, they don't allow us to come in for any type of training. they blackball nuss theus in the media completely. any suggestions to what we can do. anybody that wants to help me, please give me your card. >> i mean, just a brief word on that, it's great that you're running and great that you're raising the issues that you're raising. here's a 15-second training. we'll do it right now. when you run for office, you have to make clear that you're

running for office as an independent to change the way the system works. that you're not putting yourself forward as the alternative to the democrat and the republican but that you're running to represent the people and the people's desire to change this system. >> yes. but the greatest fight, like i say, because i was on the ballot in 2014. they come with a lot of money. they pay everybody off. and what happens is this is an emotional thing. 2016 is going to be nasty. it's going to be nasty across the board. >> sure enough. yeah. >> and so that's why i'm saying we need to definitely to prepare because my thing is we have to get the souls back to americans. and that's how they have to feel. i don't vote -- if i'm -- if it's a candidate over here that's going to do what i think they're going to do, i'm going to vote for them. i don't vote for parties. i vote for people. and that's what i say all the time, it's about the people. i don't hear anybody talking about the women. i don't hear anybody talking about abuse. i don't hear anybody talking

about the children. i hear poverty but all those are core issues. those are issues we need to deal with if we are going to motivate the people to see what having a choice is about. i'm a fourth-generation black american. my grandmother died at 122 years old in this country. she was a slave. i'm an african-american, so it's very important to me when i talk to people in florida, when i talk to people around the country, because i talk to everybody. when i hear -- people are hurting out here. and you guys can make a difference, but you have to strategize and feed us the information that we need to take to the people is what i'm saying. >> yes. yes. next. sir. >> hi my name's jim, and i'm proud to be from philly. i have a quick question for chad. if i heard you correctly you said, at least in the short run the top two won't necessarily change who gets elected, but it

will change the way they behave because they're going to be accountable to all the people. i know it's early, but do you notice a significant change or do they then go and vote along the party line anyway? >> i'd say it's not only significant, it's beyond anybody who worked on top two's wildest expectations. can you spend a day in the capitol and talk to any legislator up there and it's fundamentally change. they actually go out and have a drink together now. they're talking to each other. >> nonalcoholic. >> of course, nonalcoholic drink. but no it's fundamentally changed. i met with several members, and it's not a question in their minds. it's that the whole atmosphere in the capitol has changed. it's gone back to a real government structure. and i think the facts on the ground in california are pretty self-evident that they're actually dealing with problems instead of constantly focusing on division. so i think it has changed. >> thank you. >> yes.

>> this has been a great discussion. i admire each of you so much. you all are doing a great job. i could talk about this probably all night because this is my passion. this topic. but i've listened to so many great things being said. and i'm listening to you, and you're all saying the same thing, and yet you're somewhat trying to do something different. you're talking about how we need to bring people together. and how we need to be not about outcomes and how we need -- how this needs to be a movement that starts from the people. because, you know a lot of times reform comes about, but it's actually the establishment that's doing it. like the tea party, for example, was actually a hijack of the establishment just trying to have a new manipulation of people. and we watched this happen throughout everywhere. so i think that it's very important that as we try to create this nonpartisan primary type of reform, that we really

do spend that time amongst the people and we really help them understand what the issues are and really help them create what type of nonpartisan reform we're going to have. so i really am deeply concerned about just trying to push top two. i understand that it's a lot easier. i understand that it's simple. i understand it's easier to explain. and i understand that it accomplishes the basic purpose. but i don't think that it's going to bring the people along because nobody trusts each other in this country. everyone's divided. and the only way they're going to feel like we really are about them and we're not just once again trying to push our agenda we have to make them feel that we truly want to give them a voice. we truly want every single person in this country to have their voice heard and we don't care about the outcome. we are for the people. and so i think things that rob richie is trying to do even though it might be tricky, i think we really need to have a serious discussion about things such as rank choice voting and those types of things because i

think those things will really help people understand hey, my vote matters. i can go vote because if i go to the election and i can really indicate what my first choice is and what my second choice is and all these different candidates that are usually just fringe candidates can suddenly actually make a blurb in the election, these types of things could really help the people feel like this is their movement. so even if we ultimately end up doing top two, i think it's important that we understand fundamentally that top two doesn't really solve everybody's problems. it really isn't the very best system even if it's better than what we have. so that people understand that we want the best system, and we're doing everything we can to get it. >> chad is not going to agree with me on this but i think we're in a fight with two major tieryrannical parties. i think we welcome any reform that goes at the power of the

parties whether it's top two, whether it's top three whether it's rank choice voting, whether it's defunding party primaries. i think every piece of flesh we can take out of them moves the american people forward. >> and i just wanted to say thank you for those remarks and thank you for your remarks, harry. just because it hasn't been said and we just like listing reforms that should be said i just want to make sure that people in this room know that when, say, paul was talking about the fact that we have congressional elections where 400 of them are decided, it's because we have by statute we have one person representing each year. winner take all single-member elections, that's a statute foredecision. we can go to a whole range of methods that are proportional representation systems but there are some that are candidate based, but they open -- we by statute by congress, not going to be easy but could pass a statute to put everyone in a competitive

election for congress with a very good chance to actually elect a preferred candidate and sort of crack open the red and blue ballwall. but i think having those conversations about what we want to do is terrific, and we're doing it right now. so thank you. >> if i can add -- >> hi. my name is dan howell. and i'm the co-founder of the independent voter project in california. and along with chad's dad, steve, co-author of the top two open primary in california. first, i'd like to make a comment about what we've seen as a result of the open primary in california. i work in sacramento, and i'm around the legislature every day. and i've been associated with the legislative process in california for 40 years. i began as a district representative for an assemblyman in 1974. the thing that has changed the

most in california is the behavior of legislators. it doesn't make any difference what party they were elected to represent. the first time the top two open primary was held in california in 2012, the result was a super majority of democrats in both houses. and you would think, based on that that that would have been a more liberal anti-business type of legislature. in the first session, 27 of 28 job-killer bills were defeated in the legislature in california. willie brown, a well-known african-american, former speaker of the house calls the california legislature now the most moderate legislature he has ever seen. i was asked -- i was asked the question last night, a couple of gentlemen from florida asked me why did you win in california?

and i gave a rather complicated answer, but i could have said, we were lucky. and the fact of the matter is, we were lucky. when we started the process of developing an open primary initiative in california, we started in 2006. and we were not on the ballot until 2010. early on in the process, when we were trying to figure out what we were going to do, we did a series of focus groups. and the first fortunate thing happened for us. we did these extensive focus groups and we weren't quite sure when we took a look at the results what they meant. so what we did was we took the transcripts and the tapes from the focus groups. and we gave them one set to a republican pollster. and we said look at these and give us an analysis. we took another set, and we gave them to a democratic pollster, and we asked him for an analysis.

and what we got back was two completely politically correct analysis from each one of those pollsters. the democrat gave us all the standard democratic answers. the republican gave us all the republican answers. so what i say when i say we were fortunate and lucky what that did for us is it -- we looked at each other and said, we have to give up all of the political instincts that we have developed in the last 40 years as campaign political consultants. we no longer worked with political consultants on the campaign. and as we moved forward, we took a different perspective. we stopped fighting political parties. and we concentrated solely on the rights of voters. and when you lose, i think one of the reasons that you lose is you get caught up in this process of being against the

political parties. and when you do that, you start playing and fighting the battle on their terms, on their turf. and if you do that, you lose. so my advice having gone through this in california, my advice is, the focus has to be on the individual voter. elections are not about political parties. elections are not about candidates. elections are about the rights of individual voters to choose the people they want to represent them. and we have allowed in this country the political parties to completely take the process away from voters. not only do they control who gets on the ballot, but take a look at the presidential election next year. the political parties -- >> can i just ask you to wrap up? >> i'll be done in one second. the political parties across the country determine what days the political primaries are held in each state. that ought to tell you

everything you need to know about where we need to go. thanks. >> thank you. thank you. yes. >> briefly thank you to all the panel. thank you, jackie, for this wonderful conference. i just was thinking about the importance of the question you asked about choice. and i think it's a very profound question. and from my point of view, one of the issues is dr. newman used to say those who make the rules rule. and there was a paper about that. and so we're, i think, involving the american people in the process, ongoing, of changing the rules changing the process, being able, having the ability to determine how we vote how we elect people. certainly it's beyond the simple act of voting, but it's critical to be involved in that process. and it has you know obviously it's not -- it hasn't happened. our movement is trying to get that under way. and i think we're doing that. i think we're doing a good job. i just wanted to add that i

agree with not putting things in terms of the two parties. i think this issue of choice is also a cultural issue, a social issue, how we come together, how we have conversations and build together. and one of the things i think is important is that we not frame our discussions so much around issues. it's ha rd to do that. but around people's lives and how they live and what's happening to our people in our country. you talked about once the issue of gun control and needing to talk about what's happening to the people to the young people of our country and not going with how the party's frame issues because the way that they frame issues has to do with their being able to try and win elections. so there's a lot of innovative programs i have the great honor of working with the all-stars project and with innovative programs and approaches in education. and i think it's so important to get that kind of innovation and those approaches out into the discussion. the two parties will not allow

for that we the people have to participate in those discussions and bring forward innovative ideas as well as including everybody in those kovrgsconversations which i think is very important. thank you. >> thank you. yes. >> hi there. my name is pam lewis. i was thinking about a lot of things, the two panels. can the social crisis solve democracy? can we make political reform popular with people. and i was thinking about how when you ask somebody where they are and they tell that you they're lost, you think that -- or if they say they don't know where they are, you think, you know, they're lost or that they've lost their mind? and i think that americans are lost. i mean i really think -- i think about the communities that i grew up in as a young woman. i grew up in st. louis. and i grew up in kansas.

and in st. louis, i grew up in an all-back community. in kansas, i grew up in an all-white community. what they had in common is we did believe in the myth that america was a great democracy. we did believe that myth for better or for worse. but when i go back to those communities now, no one believes that. and i think that that's -- we're lost. and you know, we've lost our kilter. we don't know where we are. and i was thinking about that. and i was thinking about american centricism and if we can use the social crisis to transform how people think about what democracy is. you know and opportunize off that and organize around people and america being great again and organizing its democracy. because middle-class affluent

white people are lost, too. they don't know where they are. the poor communities are lost. and i think we can make it sexy, and i think we are. and i'm excited about that possibility. i really am. i really am. and i just wanted to share those thoughts. and i just wanted to thank you. >> yeah. thank you, pam. thank you. sir. >> hello all. my name is matthew gonzales. my question is what do independents have in mind about education reform? many institutions are failing to teach our students that it has become an increasing epidemic. many students and myself feel oppressed development and apolitic, and that's something i had in mind. >> thank you. anybody want to speak to that on the panel? >> -- nonconventional answer, but i think the definition of independent is independent thought. so for somebody to speak on behalf of a movement that's supposed to represent us all

individually as independents we can't have ideas on education reform or racial reform or something that binds the movement. if we're going to have a movement that's about voting rights as they relate to the individual, it has to be about one thing, the right of the individual to vote and be treated equally in the process. and then the right -- and then that, in turn, will lead to having representatives who can come together and decide issues like education. >> i'd just add the issue of education, i mean, i know best from new york city has become -- it's really terrible given thele manies of children whose lives are impacted on what has become one of the most partisan political footballs. in close primaries in which the teachers union can play a dominant role and can devote any democratic candidate and the city council is the vast majority democrat who even speaks -- even utters the word charter schools or political reform who we defeated in the closed primary, we've got to do

something about that. >> in arizona, and again, i can't speak to what's going on throughout the rest of the country, but overwhelmingly the public in arizona thinks you should spend more money on education and that it should be reformed. we have one party in arizona that thinks that you shouldn't spend any extra money. in fact, they want to spend less money on education and another party that doesn't want any reforms. and so effectively, the public can't get what they want. they can't get the proposal that allows them to have both. >> i just want to echo a little bit of, i guess what chad said. i think part of what we're talking about is at the end of the day, education is again, one of those things that government basically ends up controlling. and government becomes defined by the people that are elected in those positions. and so how do we broaden that so that you get people in those

positions who really care about, you know the things that are happening in education and the achievement gaps are still widening. and the fight's over whether you're going to do charter or public. you've got have people that really end up caring about the students and really want to do the reforms that are necessary. but you have to get the institution out of your way. and you need the people there that can do that. >> yes. >> hi my name is betty eastland. there are about 43 million people in this country that are considered disabled. that are on disability. almost half that are on disability due to mental illnesses. but we don't have a voice. in any party. anywhere. we have no one that represents us. i'm not asking for representation.

i'm asking when are we going to be brought to the table to represent ourselves? where is our voice? i don't think that people are capable of representing us. i heard a phrase earlier today called behavioral health. my behavior is not the problem. i think we really need to start thinking about this as a global problem, a health problem, period. and we need to really talk about it, and we need to listen to people who are dealing with these illnesses, who are dealing with the realities of the stigma that leave us jobless that leave us out of the educational system, that leave us having our children taken away at much higher rates for much less than other people. and so i -- i -- i will have my voice heard wherever it will be heard. so thank you.

zbro thank you. thank you. just to maybe offer a comment on that. i think what you were just raising and what you were raising about a whole set of women's issues i know that you're concerned with in bringing out in your campaign. there just is -- these aren't issues. these are -- these are what human life is about. and we have a political system that has lost the capacity to respond to humanity in human ways. and what we're trying to do in bringing about reform is to create a system that can do that. and that's what this movement stands for. that's what its fundamental principles are. and so i very much appreciate your statement there. thank you. >> and that was so eloquent.

i want to add a mechanism on top of it, but i will, which is that when only one person represents you, you get this sort of winner-take-allism where dangerous perspectives or minority opinions or those who are in the minority have a hard time getting representation. and millions and millions and millions of people can lose out from that. and if you crack that open, more people are representing you and allow 20% to represent each group of five or something, then you crack that wall. and so we have to have that conversation. but thank you for those remarks. >> yes. >> hello, my name is tiersa grafly. i'm from atlanta, georgia, and i'm active in the independent voters there. many of us will go back home where just a few of us collaborate on the initiative for political reform. what is one action item that you suggest that we do at home in our grass-roots organizing? what is your call to action for

those of us who are in the audience? >> nipanyone want to speak to that? >> i'll say quickly every state has its own rules and structures. it almost needs to be a tool kit to examine. maybe that's something we should work on, john. but for instance georgia does have runoff elections in november so that an independent can run strong and no one will ever call them a spoiler because if they're put in that quote, unquote, spoiler role, there's a runoff, right? so think about running or something, right? you know so certain states have different rules. look at what your primary system, but we do need to come up with that tool kit to kind of make it easy for people to do. >> i also think you don't need to know. in the sense of go knock on ten

doors. and ask that question to ten people. and go to a local meeting and engage. i really think that in some ways, the environment in which that question is going to be answered is much bigger than rob and i. and all of us. it's got to be an engaged local dialogue. and you can lead that. >> you have to start by speaking up. you have to start by being engaged, by talking to friends by talking about the things that you care about. what you'll find as you begin to do that is you'll find other like-minded people. as you find them you'll start to find other like-minded groups. at the end of the day, in any type of initiative process, it's going to have to be a promcompromise on a local basis. but the journey of a thousand steps, it begins with one. the one great thing that i really do believe still exists in this country is our ability to create change.

now, it's much more likely in a state where you have the initiative and referendum process. i think 30 states do. with an initiative and referendum process you have the ability for the people's voice to rise above the legislate i have been and the political interest voice. but again, it starts with organizing, getting involved, talking to other people, whether that's knocking on doors or through social media. >> maybe one other suggestion since we're all giving suggestions is let's start a chapter of kathy stewart's politics for the people book club in georgia and have you be the chief organizer of it. >> thank you. >> sure. okay. yes. >> hi. thank you. good evening. i'm ashley. ashley bruno. and i agree that clean air water and clean food are basic

fundamental important things. so let's just say recently as a picture, my last two recent facebook posts says partnerships for independent power, and then it says sign a unity letter to stop the keystone pipeline. and i looked at both of them juxtaposing themselves. and then i saw a bridge. so on the issue of how can we make independent power a hot topic, it's what is our stance on independentce from oil gas, nuclear, and how can we merge these issues? because on the forefront of baunting to so desperately conserve our resources, we're out there, we are knocking on doors, we're getting signatures

from people. where let's get 1,000 people in front of the governor's mansion to just shout and say we're angly. let's get 300,000 people in new york city to just show them that we have a voice and we're angry. yelt we still have to lobby and argue with them with these people who don't care. and so we have to get to the root of the problem. if we can actually elect people who care then we don't have to spend so much time chasing them around sabotaging their political social arena until they say we care. and a lot of times they don't. so i think that top two is a step in the right direction. because if we can reform how we actually elect our leaders, then we can actually work with people who care about the issue. so i'm thinking independent power for independent power.

>> yes. >> hi, my name is freddie. i'm from oregon. i go to the university of oregon. and i worked with the independent voters of oregon on proposition 90 campaign. the doctor said something this morning that i've been thinking about. she made a statement about getting rid of the myth that people can make a difference just by voting. and i'd kind of like to build on top of that and say that if people think that they can make a difference simply by showing up twice a year and checking a box, it's never going to happen. all of the major changes, all of the major reforms that have been passed in the history of this country have passed because the people have gotten together and

fought for it. the gentleman, the second from the end, he spoke earlier about the difference between president obama and candidate obama. and i personally believe that president obama or candidate obama was the right guy at the right time. but the difference between the two people shows us that no matter who you put in place, they are to some degree corruptible by the system in place. and the problem with candidate obama and president obama and so many other diechotomyies like that is that the people that got him there, once they got them there, they said okay, we've done it. we got him there. he'll do the right thing and it will be okay. we didn't stick around. we didn't hold his feet to the

fire. and the squeaky wheel got the grease. and the squeaky wheel in this situation happened to be the tea party. and that whole side of the argument. they were louder than us. and that has significantly affected the direction of the obama administration. and my fear is that a lot of what we've been talking about here today is, you know setting things up so that people can show up two times a year check a box, and hope it works. if these types of reforms pass, it's going to be because of this. because of people showing up getting together and making it happen. but if we pass the reform and we put the right people in place, and we don't say on top of them they will get corrupted by the system.

there is no reform that we can pass that can create a hands-free democracy. so that's -- that's what i'd like to say. we need to stay involved. >> i mean, i would simply say that i think there's a difference between being constrained and being corrupted, for one. and i think what it shows is that like most things nothing happens in a vacuum. and so i think it was a step forward having elected obama and the nation or those that voted having made that choice. but then you elected him into a constrained process. and so whatever changes could occur had to occur within that structure. and i think what people were trying to do with this movement

is to ensure that that process doesn't remain a vacuum and that you can open that up and change it throughout. >> let me take a second and underscore what the last two speakers have said because i think it's so, so important is that -- i am 70 so i forgot her exact words but i'll paraphrase. it won't be as eloquent. but the activity of the american people, self-organizing to take their democracy back is transformative in and of itself. we can't go to sleep after that, but that might wake us up. >> i think i want to move on to the next speaker. i'm going to run this discussion until 4:30. so the folks who are at the mike are the speakers. and we're going to close off after you. and which side am i up to? you. okay. thank you.

>> hi. my name is sara, and i'm up here from kentucky. i just wanted to say first off i'd just caution alienating the tea party or the republican party or the democrat party because as a republican, i am just as disenfranchised as you all, living in a county where only democrats run. so, you know and they're decided within the primary. and i don't have a voice either. i was just going to say that. and you know, just don't alienate people to that extent. it's nobody else's fault except for the american people. we're the one that got us into this situation in the first place. okay. and then second, i had a question about the proposition 14. i did some research on it. i'm nervous. anyway. but wasn't it also one of the most expensive primaries in recent years? and how -- are y'all planning on putting any kind of you know, methods in place to stop it from being whoever buys the most

media wins? because that's what we've got right now. and i just -- i don't see -- even though, you know, california, and like the other lady said it's not going to work the same in every state. each state has a different political culture. but how -- what's the next step to ensure that the people are being heard and not just you know, 75% of us are low-information voters. so they're just going to click the button for the thing they heard the most. are y'all planning on making the next step or anything like that? >> i think that's a good question. and you can't dissociate what's happened in politics with what's happened in the media. so when they report on california's new partisan system being not increasing voter turnout, they fail to report that everywhere else in the country it's actually dropped off, and california's has actually stuck a little bit more. when they talk about more money being involved in elections, they don't talk about it in the context, if you have more competitive elections and more votes matter, of course you have

to spend more money because there's more voters at play, right? so they talk with it within the partisan context that they're used to. the one thing i find fascinating about california's primary that most people have no idea, we now have the largest black caucus in the history of california because three black people got elected who did not have the democratic party endorsement. so guess who hasn't educated us that we have the largest black caucus? the democratic party and the media who is feeding the talking points of the democratic party. >> can i just add to that? arizona doesn't have an open primary. we didn't pass one. and we had the single largest election in terms of spending ever last year as well. why? dark money rules, all right? the dark money rules have changed that game in terms of money that's going to be spent. we're going to try initiatives to try to curb it but i will tell you the supreme court's kind of left that one pretty clear. you're going to see a lot more money being spent. so the question that you ought to ask is would you rather that

lot of money be able to influence the system through a partisan primary system where they can have a much greater influence at moving your candidates towards an extreme, or one where every voter gets to vote in every election. i feel much safer with the latter. >> let me just say one last point on just rank choice voting and money in politics is that it's now been used -- it's used in about a dozen cities minneapolis and oakland and portland, maine, several other cities. and one consistent thread is that candidates who are spending the most for mayor are losing. and they're running like the more traditional campaign. and the scrappier candidate who often -- who ultimately wins is the one that does more of a grass-roots campaign where it turns out that earning the second and third choices, which you really need to win in a competitive race you don't win with a 30-second tv ad. you have to make some connect

where people say okay you're not my first choice, but you've done something that you -- you listened or there's something about you. so hey there's no magic answer to money in politics, frankly but there are ways to reduce its impact, and that seems to be one. >> sir. >> my name is william from brooklyn, new york. i have two quick questions. one is as we move forward with ballot initiatives and the legislateive initiatives, i'm wondering if there is a possibility of our combining top two instant runoff and proportional representation. and then the other question i have is senator chuck schumer of new york has come out in favor of open primaries of some sort. and i would appreciate comments on both of those questions. >> sure. yeah. >> i don't mind addressing that one. because earlier i had mentioned

the need to simplify. i don't mean that top two has to be the ultimate decision. i think that we should have other systems that are tried and that we see if they work. our lawsuit that we have oral argument on tuesday. in fact, we had a great amicus brief offered by fair vote explaining different systems. i think what we need at the core is a discussion of about the electoral process itself and go into that discussion knowing that none of us have the right answer to the best solution because frankly very few solutions have been even tried so how would we know? >> and as an example, rank choice voting like the louisiana system, which is where everyone goes to the november ballot, you could use a rank choice ballot in that november ballot. and then if it was multiseat if it was a legislature, you'd have more than one person winning. if it's like, say -- if you're electing people to the legislature rather than one seat being elected, you might have three. and then a proportional system would mean you'd take about a third of the vote to win one. so that's a statutory change,

sort of one example of how they all could be put together. >> on the question about the schumer campaign that the gentleman asked yes, senator schumer wrote an editorial that was published in "the new york times" during the summer which came out very, very vocally. and strongly in support of top two open primaries. and then he never said another word. so we decided in our new york operation, decided, well, let's remind him that this is the position that he took. so there's been a campaign that's been run in new york. now over the last several months. where thousands and thousands of new yorkers are signing on to a letter to senator schumer calling on him not only to lead the effort to bring top two open primaries to new york, but now in particular to have the democratic party make the decision to open its presidential primaries in new york to all independent voters,

something that senator schumer is actually in a position to do because the party could do that without having to go through the legislature or any such thing. and how many signatures have been -- >> just over 7,000. >> okay. over 7,000 signatures have been -- >> signed at the open primary. >> there you go. and people can sign at the open primaries table. so please do on your way out. and the open primary table people just raised their hands. >> the lobby of the new york delegation. >> yes. thank you very much. and there's also been a series of meetings with members of the congressional delegation from new york to push them. thank you. to push them to follow the lead of their senior democrat leader with regard to the top two issue. so we continue to push that issue from the bottom up. sir. >> greg dorsey, baltimore, maryland. so the question is inspired by the acronym, committee for a unified independent party. so my question is as we try to define the future of the

independent movement, and i would like an opinion on -- from everybody, possibly, including you, jackie, are we to think of it as a third party that's going to have policy and platform and eventually rank and file and maybe have more power and have an easy voice because of the money that would come with it or might we retain that free-thinking spirit that independents have and stay as let heterogenous parts around the country. so the question would just be simply where do you all see the future of the independent movement as far as infrastructure? and just one statement i feel like independent candidates are going to be the key for any policy shifts that we're going to have dealing with anything. >> bravo. >> yeah? >> i'm speaking just for myself not for the movement.

i think becoming a party is the single worst idea we could possibly do. i don't want any organization controlling my way of thinking none. nor do i want the other candidates to be controlled by it. i want the voters to have a right to listen to me and the 20 other people that might run beside me and make a decision as to who they'd like to have. but i'd like all the voters to be involved in that process. now, i think there are things the independent movement can do. clearly i think it can be helpful in changing the structure and the architecture so that more people can participate. i think that it can help in education. i think having more independent candidates running is a terrific thing. my guess is, early on in the system, what those candidates will do is they may not win, but they can begin to change the debate. somebody had mentioned teddy roosevelt earlier in the day. teddy roosevelt lost that

election, but he clearly changed the skrout comeoutcome, much like rush limbaugh against bill clinton. he made clinton talk more about the fiscal issues because of what he had done in that campaign. having an independent candidate running for president that was talking about the importance of allowing all people the right to vote and that the right to vote comes from the voters as steve has talked about maybe is the catalyst that begins to help move that change forward. so helping independent candidates, i think that's a good idea. endorsing independent candidates, i think that would be a terrible mistake. what we're trying to do is to give more people a choice, and that, to me, is the function of what we should be doing as an organization. >> one minor correction with ross perot. >> i'm sorry. >> 1992. >> yeah. >> who might feel a little miffed. so the -- >> i said rush limbaugh. there you go.

>> i think that we feed to have a flowering of association. this is a room of people that feels connected, i think. there seems to be a lot of connections among people as independents. it's not like everyone's in their own chair not at all wanting to be connected to the person next to them. it's okay to be connected to people. i think that to be rigidly boxed in, as a democrat and republican and that's it, you know, that's not good. but that if we can have a ballot that actually allows association to be shown, to connections to be shown and that that you can call it a party, but you can just call it an association, but it's not rigid and it might be a new one a couple years from now. that brings people in. it makes people feel connected. and i think there's a whole conversation to be had about how that could be put into our politics. wash stateington state's form of top two, you have a certain number of characters where you can say your -- you can say what you're

connected. can you say your association. and people aren't very creative about that but they could be and say prefers you know, whatever they feel connected to. and a series of people might feel connected that year in a certain way. i think that if we move that direction and allow more choices on the ballot where we have a rank choice system to accommodate that choice, i think that we can have a politics that brings more people in. >> i'm sorry. no, no. >> no, go ahead. >> the committee for a unified independent party which was the founding name of our organization was created by dr. filani and myself in 1994 in the context of the creation of the national reform party which grew off of the perot run in 1992 and the reform party came together basically as a left-center-right coalition of independents who were working to form a national party but to use it to leverage against the standard behavior of political parties.

we had a beautiful experimental period from about 1995 to 1999. and during that time, we brought americans together across the political spectrum and looked to bring other independent parties into a relationship with us, right? to build a broad unified independent party. but one of the things that happened after about five years of existence was that the major parties came in in different ways and essentially wrecked the reform party. and one of the things that we learned from that experience is that literally the form of organization that is a party gravitates in a particular direction that ends up deflating and depressing the very cause that brings people into independent politics in the first place. so i am extremely sympathetic to paul's position on this. after 2000, we made a shift away

from party building to organizing independent voters into associations that could leverage political power that could engage with the political establishment including the political parties but without turning ourselves into a political party because we found that culturally and politically it made us too vulnerable to do that. and so we're actually creating new forms of expressing political power in this movement. so i think there actually is if you will, a unity between form and substance here. at least that's what we're searching for. and so that's why we've been very, very cautious. we don't want to create anything that's premature or that's predecided or that's prepackaged because this is a movement with a new vision and new ideals, and it has to have forms that give expression to that. >> yeah. >> i would echo, i think -- i

think you scant start with party. because i think the whole idea is opening the process. and in order to change the process you have to be able to bring people into the process. and i think that's the voting catch. i think top two, things like that open that process. so that people who feel that they can't participate can participate, and then i think as paul said earlier, once you get one person taking one step and collectively taking that one step, then the structures that will support that will begin to naturally develop. >> thank you for your question. >> good answers. >> yes? >> hi. my name is alicia berea, bronx community college student, also a student of dr. rafael mendes. my question is, where does development fit in your reform? because without development, we

do not have a democracy. if you do not fit development into your democracy and also without it we cannot change the laws. without changing the laws we cannot change the culture that we live in that's passive and cynical. >> i think that something freddy said earlier speaks directly to that. that no reform leads to a hands-free democracy. that goes to the development issue. in my mind, development is the absolute key issue. and part of political reform is can you get the parties' grip off the process for a moment, for a second? can you create some space for development? and that's not a guarantee. there's lots of environments for development where things don't develop. but it's an opportunity to create new coalitions, new

conversations. and that to me -- chad said this earlier. once you enact top two, once you enact political reform that's when the challenge starts. not before. when the systems close down the opportunities for development are nil. you open it up that's when we have to get to work and create the new conversations that can -- that are not leading to development, that are development. i think it's a very crucial question. >> thank you. >> thank you. >> yes? >> hi, i'm rebecca feldman from new jersey. i want to thank you for doing this, for inviting me. i've learned so much today. i'm so inspired. i have a really practical question. because i think political reform is popular with the american pem. you've shown that with the surveys you've done, with the 2008 election. but to connect with people when they're listening when they're going to the polls for the 30-odd states that do have the power of initiative and referendum, better to pursue it

in a presidential year, in an off year? when -- i mean, do we know yet what that pivot point is where -- is it about turnout? and getting the right audience? can you tell us something about timing? >> i think the landscape might be different on different -- first we should all thank rebecca for being a plaintiff in the case against new jersey secretary of state. obviously playing a huge role. as it relates to when do you file, we actually filed in a primary which was counter intuitive and against the advice of the political consultants in california. had it not been for dan howe running to the governor's wife at the time saying, keep it on the primary ballot, trust us, i don't think we would have -- i know we wouldn't have passed it. and -- because the consultants were thinking this is a partisan primary. independent voters don't

generally turn out. but we had done the polling to know with the lower turnout all we had to do is communicate with a lesser number of nonaffiliated voters and we could do it while the parties were sleeping because the institutional money wasn't going to around until the general election. so we actually said keep it on the ballot. we drove a campaign to voters. the parties don't ever talk to because it doesn't matter to their campaigns. we increased voter turnout by almost 450,000 that election, which was just enough for the margin of victory. >> the answer to that question though, chad's right, it's going to vary state by state. we in arizona can't put it on primary election day. that's one topic. what we do know is that in an off election year, the years when where we elect our governor as opposed to the president, our turnout drops by about 20% to 25%. we do know is that that 20% to 25% is disproportionately young

people, independents minorities. we statistically can show that. those are also groups that we tend to do better with in an open primary in arizona. but i don't know that what exists in arizona is right for every state. i really do think that what chad provided and what his dad provided and others provided in california was the ability to be strategic. to look at it, to think about it, and to try to figure out a campaign strategy that would get them to a win number. end of the day, all that matters, what do you win what do you lose? at least to the people we care about. at least to the people we're talking about that are affected by these policies. if we lose we've done nothing. we maybe moved the ball a little bit. so you have to think about whether you're rank voting or top two. whether you're on a primary election or on a general election. what are you going to do to win? because if you lose it you maybe made a small ripple but it

won't be enough to relevant create the change that we want. -- >> and i would only add one thing to those very good remarks which is that steady your yes vote and factor that in. because it may be different in different places. and then take some time to build support for it. like rushing can be seductive but it's usually dangerous. >> thank you all. >> thank you. >> yes. >> katie burn, i am a freshman at university of north carolina greensboro. and in regards to jackie's earlier comment in progressive panic and the goal the independent party being re-establishing humanity within a very politicized rights specifically with myself and the queer and trans community. i wonder how that is going to happen without a specific set of partisan things in regards --

recently you could think of the laila alcorn act being put in place but only very -- after she killed herself. how is this going to help me as a queer person? how many more queer people have to die before, you know, real change is going to happen? because it's very -- like the democratic party is failing queer people beyond the very agreeable point of gay marriage and we're very much left out of a lot of political movements. >> i might just give a comment from arizona's standpoint on that. in arizona, one session ago we had a bill that got out of our legislature that actually said that you couldn't do anything to stop a business from being able to discriminate against someone from being gay. now, i can just about promise you that would have lost in front of the voters.

it just would not have been successful. why the disconnect? because the majority of the legislature is elected by 4% of the people who vote for them in their primary. and they're captive to them. they really can't speak to the general electorate because they can't get re-elected if they do. they have to speak to that base. then when you combine that with the caucus system where they become afraid the moderate republicans become more afraid of the more conservative ones, it becomes very harsh on minority groups. my answer is that the ideas that you have, they're good ideas. they're things that are important. they're thins that will motivate the public. just like martin luther king's movement did when it was able to reach a broader audience. we are at the most risk when you're dealing in an isolated room with a group of people who quite candidly don't put your interests as a priority. >> i would add one thing to that, which is that i think that

bringing the american people together around democracy and around taking control of our political process and asserting ownership of our government, our country, our political culture. the way we want to organize ourselves as a society, means that we can break out of a certain kind of atomization or sometimes referred to as identity-based politics where every group is looking at a situation based simply on an identity that they have been given. and allows people to come together and learn from each other. you see, my issue with respect to the questions that you're raising is that i want all of america to understand by virtue of knowing and being close to

and working alongside with i want all of america to understand the issues that the queer community is dealing with. right now we have a political situation that doesn't allow that to happen. as you say, unless there's a tragedy where headlines are made that's the only time that we can break through. we can't allow that to happen. we have to have a political system and a political process that allows people to be who they are and work together to make a better america for everyone. and i think to me one of the things that is most exciting, and i've been a political activist since i was 3. is that we can do that. that we can break out of issue orientation, identity politics and say, hey. we're going to come together as a country. we're going to come together as a people. we're going to make sure that justice is done for everyone. that everyone has the right to

live the way they want to live. that everyone is protected to live the kind of life that they want to live and we're going to build this country in such a way so that everyone can fulfill their individual and creative potential. that's what this movement is about. so that's why i think that democracy issue is your issue. i really do. yes -- just a point here. there are two more speakers who came to the podium. i mean to the line. even though i was planning to close it i'm going to let you guys speak. but you're going to have literally 30 seconds to make a closing comment. jason. >> so jason olson independent voice in california again. i love the discussion that we're having. and it's -- particularly given i think the folks up here. it's a little heavy on the kind of electoral tactical kind of discussion. are should we do this one, should we do that one? i would love if the panel could speak a little bit to how you

understand the necessity of building a movement for independent political reform. particularly in light of the title. how do we major it popular with american people? because i've been doing this a long time. we were involved in the first campaign in 2004 in california. it was a very wonky discussion and we got our asses kicked. so only i think through a lot of trial and error and a lot of hard work to build the right kinds of coalitions that spoke to enough groups that actually happened. and then once we passed it we weren't done. only 25% are of voters interests in this last election cycle character new they could participate in the election cycle. our group went out and ordinary citizens met with all the county registrars and voters we could get to in order to change the way the voter education materials worked. so i'd love it if you could speak a little bit too how you understand building a movement to make these tactics basically word while.

>> i might just give a quick comment on that. the nice thing about building this movement is the other side's doing an awful lot to try and help us do it. almost daily, you know, they do things inside their parties that are disenfranchising voters that are pushing them to the outside, that are making them give up on the system. there's our danger. our danger is that the public tends to be giving up. they're starting to believe that, in fact, maybe we can't make this thing any better. we have to give them hope. what we have to do is to make them believe. to believe that, in fact, we can make things better. that's why i'm here. i think that's why most people in the room are here. >> this is not a direct answer, jason. but one of the things that keeps going around in my head is and in my life is that one of the

lessons of being active and building together is that you don't need permission to do something. people can just do something. and then you can see what happens. and then you can do something else. the cops and kids program is a wonderful example. after a police murder in new york, literally cops and kids, which now is in partnership with the nypd, came about because she and fred newman said, what's something we can do that's really different that might take us down a road that's not simply protesting? and i think if we can teach americans that they can do something new together, i think that goes a long way towards getting us out of all the boxes and dead ends that we're in. >> i guess -- let me take this opportunity right now to say that i think what i was saying

earlier, that i really see this issue as a social justice issue that we have a system that excludes people from meaningfully participating in an election where they can make their own choice. i say if there's not going to be any justice, there can be no peace. >> we've seen voting pass in 13 14, 15 cities. a lot of them is a small number of people that just said let's just do this. they found residents and were able to do it. sarasota, florida. there's basically three people pushed it, they got it on the ballot, got 78% of the vote. and so there's different places that have passed it that way. there's one state, minnesota, an

independent group that works there, they passed it in minneapolis and st. paul. but they also really created an organization on the ground as they did it and kept it and this whole issue that comes up about you have to defend your system after you win it make it work, support candidates not directly support them but help them understand the system. and that kind of movement-building is harder but it is sustained in a way i think it's very likely to expand in that state. so i guess the two ways of saying that is that this is winnable stuff. i think you have to be smart. but you pick your moments. a relatively small number of people can be the catalyst to do that. but to really sustain this and turn it into something lasting that's got to get bigger. fortunately there's a lot of people here who might help do that. >> thank you. thanks, jason. sir. >> neil grimaldi, a lawyer in new york. i'm also a candidate for president as an independent. i've been fighting for ten years

the democratic party and the control of the judiciary and running -- fighting to get insurgent candidates on the ballot. it's very, very difficult. in some courts it's corruption. for example, in queen's county, the lawyer that you're fighting against, he put the judges on the bench. i had the real unfortunate situation going into a united states federal court and fighting to get a candidate on the ballot. mr. wills who is now a councilman. and finding out after the case that the judge had actually been appointed by the other side. now i have a case in the united states court of appeals to try to outlaw the new york state board of elections. new york state board of elections is really the most corrupt institution i've ever seen. you're only allowed to have -- the board directors are the most prejudiced people. you only can be on the board if

you represent the republican or democratic party. and then they decide who's going to be on the ballot and who's not going to be on the ballot on technical cases. how could you have -- the biggest group is independents and they have no representation on the situation. it's a total violation of one man, one vote. i'd just say i really applaud your movement and your efforts. but i do think that you can't get legislation passed unless you have candidates. unless you have a structure. now, i agree that your organization the great miss kathy stewart and all of you, you could have you don't have to be part of that structure. you've had the experience, you can't argue with the experience. but there also is a need for an independent party where a person can get legislation passed and hopefully change the whole situation. and that's what i'm running on. i want to thank you very much for the opportunity to be here. one last comment. i ran for mayor last year.

i had -- >> sir, i'm going to ask you -- >> one last comment. i ran for mayor. here i am, i'm a reverend i wrote two books, bibles. i'm a former assistant d.a. public schoolteacher. i got excluded from being in the debate. how can you have such terrible corruption in the system and allow it to go on? that's what my point is. thank you very much. >> thank you. >> my name is kevin l. johnson. i've decided to -- that i was an independent in 1992 when ross perot was running. i liked a lot of the things he was saying because so many people didn't. but anyway. a large huge march like i was talking about if we can organize a real big march, a whole lot of people, taking advantage of the warm weather that's coming up, whenever we can do it, at least 100,000. that would get it out. we say we've got to get it out to the streets. the other thin is, how many people are familiar with the coast to coast a.m. radio show?

i'm a fan of that show. that's a good one for jackie saylor to go on. you can lay it on the line. jesse ventura's been on there. it's got at least 10 million loyal listeners and they're smart people. we talk about it. they talk about a lot of behind the scenes things like this. it's a perfect show for the coast to coast a.m. can we help jackie get on the coast to coast a.m.? george norry is the host of it during the week. and there are other guest hosts on the weekend. so maybe we can all work on that. >> thank you. all right. let's give our panelists another round of applause. thank you so much. i'm going to close us out now. and thank you so much for being here and for participating in these conversations. i think some of what we pursued

and opened and up talked about today are really some of the most important discussions that are going on in the country today. we want to continue them outside of the theater in the ante room there. and i'm going to come out there and want to say hello to everyone. let's keep our conversation going. let's keep our movement-building going. let's keep your leadership going and growing. thank you so very much for being here. good night. the new hampshire republican party kicks off its so-called first in the nation leadership summit this weekend with speeches from republican presidential candidates and some potential candidates. friday morning at 10:50 a.m. eastern, new jersey governor chris christie, former texas governor rick perry, senator marco rubio and former florida governor jeb bush live on our companion network c-span. the conference continues saturday morning with remarks from senators rand paul, ted

cruz and lindsey graham. also speeches from wisconsin governor scott walker, ohio governor john kasich, former arkansas governor mike huckabee, and donald trump. that starts saturday morning at 10:30 a.m. eastern live on c-span. this weekend the c-span cities tour has partnered with comcast to learn about the history and literary life of st. augustine, florida. >> ponce de leon may or may not have been searching for the fountain of eternal youth. a lot of people have said that he was out for additional property for the king of spain and and colonization attempts and gold which is decidedly true. we know ponce de leon came ashore after searching for good harbor, took on water and wood. this area presents one of the few freshwater springs in the area around 30 degrees eight minutes.

and is also the location of the 1565 first settlement of st. augustine. 42 years before the settlement of jamestown was founded and 55 years before the pilgrims landed on plymouth rock. >> the hotel ponce de leon was built by henry morrison flag letter. flag letter is a man who is very little known outside of the state of florida. but he was one of the wealthiest men in america. he was a man who always wanted to undertake some great enterprise. as it toured out florida was it. hes. ed that he needed to own the railroad. between jacksonville and st. augustine. to ensure that guests could get to his hotel conveniently.

so clearly the dream was beginning to grow on flagler. he was a man who had big dreams. he was a visionary. >> watch all of our events from st. augustine saturday at noon eastern on c-span2's book tv and sunday afternoon at 2:00 on american history tv on c-span3. the cato institute recently hosted a discussion on lowering tax rates and taxing more people. scholars from several conservative think tanks talked about the current tax code with higher tax rates for higher earners and replacing it with a flat tax. this is a hour. >> well good afternoon, everybody. thank you for coming. to cato institute's briefing entitled "defining the tax base: the real challenge for tax reform." i am peter russo i'm pleased to host this event. in january, chairman hatch of the senate finance committee

initiated another effort to get a tax reform deal done. this is no easy task. the last five years especially have seen a bewildering variety of tax reform proposals. the lower the rates, broaden the base school simpson bowls none of which crossed the finish line. many economists like those at cato favor something more radical, standalone consumption taxes or plans that replace the progressive income tax the flat tax, the fair tax, the national sales tax, and the x tax are examples. for decades there's been a constant hunt to find new things or activities to assign a tax rate to. we've seen gas, cigarette for a short time soda taxes. idea for a carbon tax and worse value added tax, which pile on new streams of revenue to our existing income tax lurk under the surface. fair>> narrator:ryfair of course, high taxes and increased xhectionty are only a symptom of a larger problem the

inability of elected officials of both parties to control spending. demands for more spending are a constant refrain in washington. successful resister tabs has been largely unsuccessful. for the most part this year's budget appears to be an achievement. that's only half of the coin. without much-needed reform to entitlements, this achievement will be short lived. in addition to controlling spending it is essential to get the economy growing at a rate comparable to that of previous recoveries. so many of our current woes on the economic and social front would be alleviated by robust economic growth. i shouldn't have to sell the benefits of this. it would be easy to imagine millions returning to the workforce rolls and taking themselves off food stamps and other anti-poverty programs. however, it does not appear the particular mix of elected republicans and democrats are about to come to any agreement. so that provides opportunity for us to discuss considerations of our own. today the assembled panel will dial in on an important aspect of tax reform defining the tax

base. what is income? what is tax? what are the effects? what reforms are necessary to reduce complexity and have the tax system being an impediment to economic growth here and abroad? daniel mitchell senior fellow at cato who specializes in fiscal policy particularly tax reform. international tax competition and the economic burden of government spending. prior to joining cato mitchell was a senior fellow with heritage foundation economist for senator bob pack wood and the senate finance committee. he's been published in "the wall street journal" and "new york times." he's appeared on all the networks and is an internationally known expert on these issues. r. burton is a senior fellow and economic policy at heritage foundation focusing on tax matters, securities law, entitlements, and regulatory and administrative law. burton was general counsel at national small business association for two years before joining economic policy studies in 2013. he previously was chief

financial officer and general counsel of the startup alliance for retirement prosperity, a conservative alternative to aarp. burton received a juris doctor degree from the university of maryland school of law. he also holds a bachelor of arts degree in economics from the university of chicago. finally, jason fichter senior fellow at george mason university. his research focuses on social security, federal tax policy, federal budget policy retirement, security to increase savings and investment. his work has been featured in "the washington post," "the wall street journal," the new york times and others as well as on broadcasts by pbs, nbc, npr. he earned his b.a. from university of michigan, ph.d. in public administration and policy from virginia tech. each will speak in turn for 10 to 12 minutes after which we'll open it up to q&a. please welcome dan mitchell.

>> thank you peter. tax reform oftentimes, especially when people are talking about radical plans such as the flat tax, people think it's all about the tax rate. should you have a system with high tax rates based on redistribution and class warfare? should you have a tax system based on one low rate? today's panel is really looking at another big part of tax reform. and that's understanding the definition of taxable income and in particular looking at two competing theories of how to tax capital income. and i have a couple of power point slides i think will help make this issue more understandable about defining the tax base. as i said the issue of tax rates is important. for those of us who want certain types of tax reform, we think it's very important to have a low marginal tax rate on productive behavior. why? because presumably work, saving

investment, entrepreneurship, risk-taking, those are good things in our society. when you have a high tax rate on those things you're going to discourage people from being productive. i have an image i found on the internet, great things on the internet. i think this really boils down to what the essence of supply side economics is. i agree with politicians when they say we need higher taxes on tobacco because that will get people to smoke less. i don't agree that we should actually try to control people's private lives but i agree with them on the underlying economic analysis. when you tax something more, you get less of it. and as our little philosoraptor is ponderering, if higher taxes on cigarettes lead to lower smoking, won't higher taxes on work lead to less work? or higher taxes on saving and investment, won't that lead to less saving and investment in the issue of tax rates is very very important. but our topic today is not a challenge for tax reform it's what i think is the real

challenge for tax reform. if you look at some of the proposals that are out there, and you can go all the way back to the 1980s to things like the usa tax, things like that. so much of what really happens when we're talking and debating about tax reform in washington is this fundamental discussion over whether or not we're taxing all income whether we're taxing it zero times, one times or more than one time. and as the bottom bullet point suggests i think one of the major issues that we need to wrestle with is how to you deal with the tax burden on income that is saved and invested? there are of course -- and david and jason will both be talking about some of the specifics of this, in this discussion. i'm trying to focus on sort of the underlying theory so we can get our minds around what the real debate is about. so let's look at what i think it's really a fight over. there's two competing tax bases

out there. there's probably actually lots of them. but in the big picture fight there's two. there's the made tax base that undergirds our current system, it's certainly the tax base the joint committee on taxation when they analyze the tax system. assumes there should be double taxation, that government should not only tax income but also changes in net worth. you can contrast that to the consumption base and the consumption base at its essence, at its core, is simply whether or not you should treat income equally whether it's consumed today or consumed in the future. and what is consumption in the future? it's just another way of saying saving and investment. now, why is that an important issue? well, it's an important issue because right now we don't have that neutrality between current and future consumption. why don't we have it? because we impose all this

double taxation, triple taxation, on income that is saved and invested. now i should point out a consumption-based tax, because this oftentimes for neophytes isn't understood it doesn't mean a tax collected at the cash register. yes, a national sales tax is a consumption-based tax. yes, value-added tax is a consumption-based tax. so is the flat tax so is the x tax peter referred to. basically, if you're big all saving and investment in the economy i.r.e. treatment you're moving to consumption-based tax you're getting rid of double taxation. you're either taxing people when they first earn the income or when they consume the income. if you get rid of double taxation you have by definition a consumption base tax. when you look at say the flat tax versus the national sales tax, they're basically different sides of the same coin. they both have the consumption base. the only difference is the collection point.

the flat tax taxes your income one time at one low rate when you first than it. something like a national sales tax taxes your income one time at one low rate when you spend it. but the bottom bullet point is the important thing. neither have double taxation. which of course is pervasive in the current system. you won't be able to read this chart. but it shows the difference between a consunlts-based tax and the hague simons tax. the right side is being the hague simons tax base, what our current system is. the top green box is earned income. the first blue box is you pay tax on that income. the second green pox is you have after tax income. what are the two things you can do with your after tax income? you can either consume it today or consume it in the future. if you consume it today that's the left side. the government pretty much leaves you alone. what if you consume that income in the future? if you save and invest it? that's the right side. and between the capital gains tax, the corporate income tax,

the double tax on dividends and the death tax, it's possible for that single dollar of income to be taxed over and over and over again. which means, of course there's not that neutrality between current consumption and future consumption, which of course means that there is a tax penalty or a tax bias in the system against saving and investing. why is that a bad idea? it's a bad idea because every economic theory, even socialism even marxism every economic theory agrees capital formation is a key for long-run loathe and high living standards. why do work esget paid? because they produce. what determines how much workers produce? a lot depends on quality and quantity of the machinery, the equipment, the technology, the capital that they work with. so when you impose extra layers of tax on saving and investing that aren't imposed on immediate consumption, you are creating a tax bias against capital and you are therefore reducing the capital stock in the country,

you are hurting the economy and you're of course ultimately hurting workers because they won't earn as much because they won't be as productive. it makes no sense to impose a tax bias on productive behavior especially productive behavior in the form of saving and investing, since every economic theory -- the socialists and m marxists, don't get me wrong, they have crazy ideas. they think the government should be doing the saving and investing. at least they agree capital formation is key to long-run growth and higher living standards. in some sense i think this image sums up the difference between a consumption base and a hague simons base. if you want to harvest apples what's the smart way to do it? do you pick the apples off the tree? or do you chop down the tree? if you're taxing capital, you're chopping down the tree. or at least sawing off the branches depending on the degree to which you're taxing capital. in a smart, intelligent system

where you're trying to macs myself income and prosperity for an economy in the long run, you want to public the apples but leave the branches and leave the tree so that you're going to get another crop of apples next year and the year after that and the year after that. whereas the mindset of the hague simons tax base is, not only do we want to tax the apples let's at least saw off some of the branchs. why? i'm not sure, other than here's the political challenge. this is why we have a hague simons tax base. we have it for two reasons. first, class warfare. who has a lot of saving and investing? who does a lot of saving and investing? rich people. by definition who has a lot of capital? that define yts you're rich. so if we decide that we don't like rich people for political reasons or we decide they're the easiest target and politicians try to extract revenue from the productive sector of the economy, you impose taxes on

capital. you can impose high marginal tax rates but a lot of times rich people have capital that might not be easily accessible if you're simply imposing a high personal income tax rate. that's one reason why we have these destructive policies that penalize saving and investing. the other reason i think is just ignorance. how many of us have seen warren buffett make his silly claim that he -- his secretary pays a higher tax rate than he does? the only reason he can make that claim is he wants us to forget any capital income he's receiving has already been taxed at the corporate level. not to mention the fact that the income was taxed before he first then invested it in some income-producing asset. not to mention the fact that it will then be subject to a death tax. so if you simply focus on one tax in isolation and you ignore all the other taxes in the stream that are affecting that same dollar of income, and a lot of people i genuinely don't think it's mall has or class warfare, they just don't understand the difference. they think, a rich person got a capital gain, therefore, we

should tax it because isn't that fair? well, except if the only reason you got a capital gain, which by the way only came about because you took your after tax income and invested it. why do assets go up in value? because of expectation in the marketplace that it's going to generate more income in the future. but when that more income in the future actually happens, it will be taxed. so whether you're doing it forward looking or backwards looking, the capital gains tax is a form of double taxation. so part of the purpose of this panel, and i'll go ahead and stop at this point we want people to understand that double taxation exists. there's no actual ambiguity about it. if we had someone from a left-wing think tank, they'd agree that's double taxation. there's a consumption-based system. they'd argue the hague simons system is justified for ropes of revenue collection redistribution, something like that. they'll agree with the notion that there is double taxation they'll agree that warren buffett is being double, triple, quadruple taxed, even if he

wants us to believe it's not actually happening. with that, i'll go ahead and stop and turn the floor over to david. >> thank you, dan. i've been asked to talk about two things. investment or capital cost recovery, and the international tax system. so let me start with investment. let me ask you a question or pose something for you to think about it. if you buy a million-dollar machine or a $100,000 machine to make widgets and then the $100,000 machine in the first year earns $200,000, have you made any money? most people would answer that question, no. you haven't really made the money until you've got at least the cost of your machine back and one additional dollar. so this is a basic core idea underlying the fact that the capital expenses should be deductible like other business expenses.

you see that in section 179 for small business expensing. but it should be applicable to all investment. let me try to explain some reasons why. dan mentioned that investment is key to productivity and increasing real wages of ordinary people. we see that all over the world. many, many different cases. but in the united states, tax policy, the last time we did anything significant in terms of moving towards expensing was in 1981. the economic recovery tax act of 1981. under president reagan. that gave us something called the accelerated cost recovery system which was a substantial move towards expensing because businesses could deduct their capital expenses more rapidly. as a result of that you saw an investment boom that was almost unequaled in our history. and that laid the foundation for a very extended period of strong economic growth and one of the most robust, dynamic recoveries that i couldn't tell lasted the

reagan administration. so this is a real-world effect. it can have a tremendous positive impact on the american people. in more formal terms, when you delay the deduction of capital expenses, potentially as long as 39 years under the current system, you raise the cost of capital. you mean that a business has to earn more money pretax in order to justify the investment. and as a result you get less investment, you get less productivity growth, less incorporation of new technologies, and lower real wages than you would otherwise get. if you have a flat tax type environment or the current tax system, you move to expensing. a sales tax does it similarly by simply not taxing as consumption the purchase of a machine. but either system gets you to that result.

a couple other things. there's a secondary consideration. the curt system plays favorites. it picks winners and losers. so by giving some types of investment relatively accelerated deductions or expensing and others as long as 39 years, it distorts the capital stock. so you have two questions. one is do you want to broaden the capital stock make it deeper, have more investment? the question is where does that flow? our current tax system distorts it tremendously and leads to a less efficient capital stock which also has an adverse effect. in any of the fundamental tax reform plans the flat tax, lee rubio, anything that moves toward expensing solves that problem as well. let me just briefly touch on one other question. we hear a lot about lowering the rates and broadening the i was. and that is good. a consumption tax is broader than the current tax system.

but in the business sector, we got rid of most of the true junk in 1986 '86 tax reform act. if you get rid of things that are not treating capital investment correctly there's only enough base broadeners in the corporate side to drop the rate about 2 points maybe 3. so the problem we face today is that we're an outlier. we have inappropriate levels of business taxation compared to virtually every other industrialized country. we have the highest statutory corporate rate. we have among the very worst treatment of investment. then we also are the only major industrialize the country that taxes its businesses on income earned everywhere in the world, instead of just income earned in the ups. united states. when you combine those things and a number of other things you realize we basically have a serious problem. we're making the united states

among the least attractive places from a tax perspective to do business in the industrialized world. and we see that. our businesses are no longer as competitive as they once were. we need to repair that damage. so with that, let me move to the international. the u.s. taxes u.s. corporations on income earned throughout the world. now, we also provide a credit for foreign taxes paid. but that credit is limited to the u.s. tax rate times the foreign source income. it's really not that simple. because the foreign source income is divided up into a whole series of baskets, potentially hundreds for any given country, based on the type of income and what country it was earned in. and then you have a complex series of rules allocating income and expenses between united states and abroad for purposes of determining whether the income was earned within the u.s. or abroad. which is necessary for purposes of the foreign tax credit and other reasons.

but the long and the short of it is, we tax u.s.-based businesses on their income throughout the world. so one way to avoid that is to merge with a foreign corporation. if you merge with a foreign corporation, then the new combined entity is only going to be subject to u.s. tax limits u.s. sourcing income. as long as we do that we're basically driving corporate headquarters functions outside of the united states. so when you see anheuser-busch merging it's simple to decide the new corporate headquarters is going to be in europe. and ask the people of st. louis how that's working out for them. when chrysler and mercedes merged, even in the old days, the new corporate headquarters was in germany. not in the united states so on down the line. the only way we're really going to prevent this tremendous push to move corporate headquarters

from the united states to abroad, in effect control the businesses to abroad, is to move to a territorial system. that taxes u.s. businesses on u.s. source income. but it has -- having a corporate headquarters has a number of positive effects. obviously you have the higher-paid corporate functions in the united states instead of abroad. but it's also proven as an imperial matter that u.s. businesses tell to sell more goods made in the u.s. to foreign subs than if the business is run offshore. so somewhat counter intuitively it's better for u.s. exports to have a territorial system. and i guess the last point i'd like to make on the international stuff is that u.s. multi nationals have become fairly good at gaming the current system. it doesn't raise that much money. it almost gets them to the category of a fiction. and that's because they're able too manipulate intercompany

pricing, the pricing of intangibles such as trademarks royalties, and other copyrights patents, so on and so forth. and lastly interest. whether they borrow abroad, borrow in the united states. so that they can basically increase their foreign tax credits beyond what is theoretically the right answer. and drive down the effective tax rate on foreign sourced income. moving to a correct system, a territorial system, that no longer encourages these inversions, would probably not cost any money. so we have a system that is basically having all these adverse economic effects on the competitiveness of u.s.-based businesses. but isn't raising any or very little money. and if you address the intangible questions and the

interest allocation questions you can do that and not lose any money. and in terms of how to do that, former chairman of the ways and means committee, chairman camp, had a number of good proposals that would solve the issues. so these are somewhat difficult problems, but they're solvable problems. it would put the united states back into the mainstream. and that's what we need to do. we need to move our business tax systems to a more competitive tax system. we need to reduce our corporate and pass-through rates. we need to move towards expensing of capital expenses rather than biassing a system to it. we need to move to a territorial and border adjusted tax system. with that i'll turn it over to jason. >> thanks, david. good afternoon, guys. there's an old joke if you lined up all the economists end to end

the one thing you would not get is a conclusion. but we're actually up here in a lot of agreement on tax policy. on what's wrong with taxes the tax system individual and corporate income tax, what needs to be done about it. and it kind of puts me in an odd spot. my colleagues have said most everything. so sort of in honor of the first week of baseball i'm going to bat cleanup and bring the runners home and hit points they touched upon and re-emphasize the importance of it and why it's important we consider tax policy, the tax base, and talking about tax reform. we are also now getting into the start of the presidential election season, if you will. and with that, candidates come out with various tax plans. there's misinformation on what taxes do and don't do, who pays taxes and who doesn't. it might be a good time to review important issues. as we start getting into the silly season of the presidential election cycle. with that i want to highlight

what both david and dan said about how xhipss generally prefer a broader tax base with lower marginal rates. this is very important. because it really is the tax rates that drive the decision at the margin. it's at the margin we decide whether or not to work that extra hour whether or not it's too expensive to invest that extra dollar, whether or not because taxes soar high leisure is less expensive, it would decide not to work at all. you'll hear discussions about corporate tax, whether or not we have the highest tax rate. we do. some will say, our effective tax rate is lower. the effective tax rate is because we have so many exemptions and gimmicks that we're allowed to gimmick the system that the disincentivizes some behavior and incentivizes others. it's not the effective rate that dlifs the decision it's the margin. we have to focus on the margin and lowering the corporate tax rate at the same time, broadening the base. we have a question about individual and corporate. what do we mean by tax expenditure?

you might have heard a few years ago if we got rid of all the corporate and individual tax expenditures we could raise $1.3 trillion that would have taken care of you're deficit time we're all set. tax expenditures aren't all loopholes and it's important to point this out. certain preferences in the tax code are like government spending. others aren't and are designed to take away a certain efficiency in the tax code. to give you an example the expollution of employer-provided contributions for medical insurance premiums. our employer pays for health care premiums, they're not taxed on it we're not taxed on the benefit. that might be considered a tax expenditure that increases spending on health care. the preferential treatment of capital gains is designed to offset some of the inequitiable double taxation that exists since capital gains are assessed at the corporate level and then the individual level. it's not a design in the tax code, hence it's not a tax expenditure. certain administrations, presidential administrations

some like this administration have called it a tax expenditure, others like president bush hasn't. ombs documents for the budget, it changes from administration so traition. so it's not consistent. it's based on one's political perceptions what they think a tax expenditure actually is. david mentioned the tax reform act of '86, how a lot of the junk was taken out. it's important to note that's true. the tax reform act of 1986 is considered the most successful tax reform act in american history, and also the worst tax reform act in american history. today we have more exemptions in the tax code that we did before tr-86. the lesson is once we start broadening the base and lowering rates people still come to capitol hill and say, that's great but give me an exclusion for this benefit this activity. the base broadening starts getting narrow again. corporate tax, we might have a chance to do corporate tax reform.

this president in the past has called for lowering the corporate tax rate to 28%. other candidates have gone 25%. that might be an area of compromise. keep in mind the united states corporate tax code severely distorts market decisions and allocation of resources. the tax code hampers job creation and impedes both potential economic growth and potential tax revenue. and again, my colleagues mentioned this as well. many developed countries are both reducing their corporate tax rates and restructuring their corporate income tax code to make them simpler. the united states federal government appears to be taking the april sit approach. i'll note that some states in the united states have been lowering their corporate tax rates and offering competitive tax packages to attract businesses and investments. northern competitors are doing that well. a high corporate tax rate and numerous temporary provisions increase up certainty and costs for the american business. this drives competitive profit-seeking corporations to minimize their tax exposure and

defer income overseas to lower taxed countries. even for some to reincorporate outside the u.s. even worse, some u.s. companies take out debt in order to pay dividends to shareholders in order to maintain income overseas to avoid bringing it back at the high u.s. corporate tax rate. unless united states reforms its tax system and lowers its rit our country will fall further behind. our tax rates much higher than other countries u.s. corporations must turn accounting departments into profit max amazing centers. david mentioned transfer pricing. companies need complex financial engineering tactics to minimize revenue losses using tax code preferences. this is why we're so interested in broadening the base and lowering the tax rate. your various capital to different countries and thus improve their competitiveness. exhaustive economic research clearly proves this most basic effect. the more you tax capital or labor, the less you get.

it also makes clear incentives matter. so success will lower the current individual and corporate tax rates on both. the u.s. tax code is rid deed with loopholes. tax rates that treat similar activities equally distorts. the current tax conditions treatment is emproblem mattic of these problems. something david mentioned as well. shifting to full expensing allowing businesses to write off all expenditures on the purchase would offer an even ground for capital investments. it would greatly simplify the tax code, advice investment reduce the ability of politically favored industries to gain targeted tax benefits. one thing we should not do. we shouldn't race taxes. that's going to make matters worse. u.s. corporate taxes are the highest in the industrialized world. this increases business flight to lower-taxed country taking their jobs, money, and tax dollars with them.

there's much research to support the negative consequences of raising taxes on economic froetd. increase phone roamer, former chair of president obama's council of economic advisers. david roamer suggests increase of 1% reduces output by nearly three%. according to research macro economic and micro perspectives suggest higher taxes slow economic growth thereby leaving a scope for revenue gains. looking at the idea, if we gave lower rates we actually could raise revenue. david mentioned that as well that it might cost us actually nothing in the long run. so it's important to keep in mind something, we talk about taxes, the corporate tax is actually in part a tax on labor. while the joint committee on taxation commission budget office recently changed their insert assumptions on the corporate tax which now assumes 75% of the tax is paid by openers of capital and workers bear 25%, it's important to point out this is actually a change, a congressional budget

office working paper pointed out at one point that slightly more than 70% of the burden actually falls on labor. so we're trying to increase taxes on corporations, all we're doing is passing that along to workers in the long run, or to consumers. regardless of corporate income tax, one of the keys to success for reform is move away from a spending system that depends upon easily manipulated income tax system. tax reform should lower rates, broaden the base, eliminate loopholes, and this will increase stability and lead to greater economic growth. i know my time's running short and i want to leave time for questions. i want to point out something that dan mentioned. it's very important. he said it was about warren buffett, how he pays a higher tax rate -- or a lower tax rate than his secretary. that became also a political issue. again this also belies the importance of the income tax and the corporate income tax and who bears it. to put mat together, the corporate tax rate is 35%. if a business has $1 of profit

that wants to distribute to its shareholders, it is first taxed 35% on that one dollar. that leaves 65 cents of retained profit that can go so you, sharyler. we now have a capital gains tax rate of 23 ] 8%. that means your effective tax rate is over 50% if you're in the highest tax bracket. so we're already taxing capital at 50%. that's one reason why we have a lower capital gains rate. to first take into account we're taxing at the corporate level. one thing we might want to discuss is whether or not we should get rid of the corporate income tax altogether. and just start taxing income all the same. so capital gains and dividends we tax at ordinary rates. we'd have no corporate income tax at all. that would definitely increase savings and investment and make the tax code more efficient and make businesses more profitable, more willing to invest in the united states. with that i'll turnivity over for questions. thanks, guys. united states. with that i'll turn it over for

questions. thanks, guys. >> all right. so i wanted to entertain as many questions as possible. so let's state your question in the form of a question and not some other way. yeah, you, sir. >> all this just assumes that taxing consumption is completely good thing and that -- it obviously is better -- consumption tax than taxing income. i don't dispute that. but there's a bias in all these, i think, in all these consumption taxes that you are biassing against people consuming. so you have switched the bias in favor, you know, now we're not biased against investment but essentially being biased against consumption.

my suggestion which i've made, dan, a couple of times is tax the undeveloped value of the land. the georgian tax in which i don't think there's a bias one or way another. my question is why do i never hear about this tax? it's so superior, and it's -- it would be politically much easier to get because there are going to be lots of people who don't want consumption -- bias against consumption. they'll go crazy if you ever try to get a consumption tax. >> i read a few small communities in pennsylvania take that stance. i confess i've never really looked into it. but i want to disagree a bit with your premise. a consumption tax is simply an income tax with income properly defined, i.e., no double

taxation. a flat tax has the same tax base as a national tax base. they only differ in the sense you don't have these extra layers of tax that's saved and invested. you are getting rid of a bias and then you have neutrality. i think adam smith reminded us the purpose of all production is ultimately consumption. that's why we live and work. we want to consume things and enjoy life. that brings us back in the point jason was making about, we should have a smaller tax burden, not a higher. whether you are looking at it from your incentive to consume your income, if you are driving a bigger wedge between your pretax income and post tax consumption, that's what's doing the damage. you want to make your the marginal tax rate on consumption, income, productive

behavior, you want that tax burden to be as low as possible. >> let me just mention one quick thing. the income tax tax is consumption, like a consumption tax tax is consumption. if you think about it, if you want to spend $100 at walmart tomorrow, how much do you have to earn? if you have a 50% tax rate you have to earn $200. the income tax is in effect a consumption tax. it just also taxes savings and investment again. it's not as if consumption is somehow off the hook in an income tax. well, it's very important that people generally understand it. and maybe if dan put up -- talked about hague simons and literal definition of income. their definition is consumption

plus changes in their worth. the core thing is how much do you have to earn pretax to spend money today and it's -- and if we have a 50% tax, you have to earn $200 to spend $100. then if you want to consume in the future, they also tax that consumption plus whatever you earn by deferring it. so that's really the difference between an income tax and consumption tax. it's not the tax treatment of current consumption. it's the tax treatment of future consumption. >> can i add something for you to think about as you think about the concepts of better tax systems. there are two principles economists try to apply when thinking about what's a fair tax code. fairness is in the eye of the beholder. one is ability to pay? who has the ability to pay a tax. the reason consumption tax is

important is the fact you are going out and putting dollars down, assuming you do it at the cash register. the idea is you are making a choice to consume something suggests you now have the ability to pay where other measures like the hague simons which looks at capital gains and would tax unappreciated gains you may have the ability to pay it but you don't have the cash flow. one thing about property taxes it's not just the ability to pay but also is there a cash flow on a transaction basis. keep that in mind. >> i'm happy to hear about the tax reform concept and also simplification. when you look at tax reform you have to look at expenditures. when you look at subsidizing companies and corporations, and it looks like and i was told by a government official that more men are getting these subsidies

and spending a lot of taxpayer money to get women and minor minorities to get these subsidies. what if we got rid of these subsidies, would it be fair? he said it would be fairer than it is now. you look at making taxes equal, don't you think a simplification process would be easier because more women that start businesses use their own credit card than get these small business loans that are complicated because there's a process and they don't have the time. do you think simplifying tax reform and cutting back expenditures and spending less is a safer way to go. >> simplification is hugely important. anything we can do to make it simpler reduces compliance costs. compliance costs hidden and unhidden are about a trillion dollars a year. the time is takes to figure out how to get a loan, how to pay for it.

we should definitely try to find ways that broaden the base by getting rid of some of these loopholes. not all tax expenditures are loop holes. again, the lower the rate is the less valuable these exclusions are in the first place so it is very important. >> i, obviously agree the tax reform and expenditure reform have the -- hold out the promise of making life a lot simpler, although simplicity isn't everything. obama has a two-line tax reform plan. what did you make last year? second line, send it in. but all joking aside one of the advantages of the comprehensive tax reform plans if you get rid of the depreciation schedules of today's tax code and replace them with expensing, that should

be simpler. get rid of the capital gains tax, it's vastly simpler. a lot of the good things that should be done to eliminate double taxation and move toward a cash flow-based tax system also get rid of some of the most complicated provisions. you have a simple territorial tax system. it gets rid of all the mess and complication in terms of worldwide taxation. one thing about worldwide taxation? a lot of you have probably seen stories about companies kicking $2 trillion offshore. why are they doing that? because we have a policy called deferral that enables companies to at least delay this second layer of tax imposed by our worldwide tax system. you get rid of worldwide taxation and move to territorial taxation companies no longer have any incentive to hold money overseas. they'll have the ability to automatically and quickly deploy that money to wherever it's going to generate the most money

for the economy. the complications are a function of the bad policy and the bad policy we have gets us the weaker economic performance and reduced competitiveness. there's a win, win, win situation when you do good policy. >> i'm sure dan is not advocating for a repeal of deferral but changing it to a territorial tax code. president obama would like to change deferral rules so corporations get higher tax base coming in. that's not what we're trying to do. >> one last follow-up on the complexity side. the complexity of the system, dan was rattling off some. the list is endless. it adversely affects small firms and start-up firms. and large firms can grapple with the complexity but also calculating the provisions the cost of making calculations does not increase lynnkreescrease linearly.

firms trying to launch their businesses or grow their businesses. >> i'm jim. the rate coalition. this is a terrific conference. and the title is the tax base. and that's obviously a critical issue, but i have also heard at least three of you up on this panel talk about the impact of the corporate tax rate which people know is the highest in the world. and i've even heard a discussion about simplification and complexity. so those are three issues, therefore. the base, the rate and complexity/simplification. on the off chance that there's an impressiona