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Pawlenty made his first policy speech... and it is a good old fashioned Republican message. Good for him. A realignment is in order.

Tim Pawlenty said Tuesday that he would overhaul the tax code, calling it a “9,000-page monstrosity” that is “chock full of special deals for special interests.”

WASHINGTON — Former Gov. Tim Pawlenty called on Tuesday for more than $2 trillion in tax cuts for individuals and businesses over the next decade and two to three times as much in federal spending reductions and loophole closings, saying that such policies would drive rapid economic growth.

In the first major policy speech of his campaign for the Republican presidential nomination, Mr. Pawlenty intensified his criticism of President Obama’s economic policies, accusing the Democratic president of being satisfied with a “second-rate American economy” and ignoring the country’s fiscal problems.

But Mr. Pawlenty, of Minnesota, also used the speech to lay down an economic marker for his Republican rivals, essentially daring them to go further in calling for large tax and spending cuts to appeal to conservative voters during next year’s primaries.

“The United States is still home to the most dynamic and entrepreneurial people in the world,” Mr. Pawlenty said during a speech at the University of Chicago. “They’ve been discouraged and weighed down by President Obama’s big government and heavy-handed regulations. They deserve a better deal. I’ll give them one.”

Mr. Pawlenty’s proposed tax and spending cuts go well beyond anything being sought at this point by the Republican leadership on Capitol Hill, and were dismissed by Democrats and their allies as fiscally unworkable and skewed to the wealthy and big corporations at the expense of working people.

Under his proposal, the corporate income tax rate would be reduced to 15 percent from 35 percent. Individual federal income tax rates, which currently go as high as 35 percent, would be flattened to just two rates: 10 percent for the first $50,000 of income and 25 percent for income above that.

He also called for elimination of all taxes on capital gains, interest income and dividends. And he proposed eliminating the federal estate tax.

Mr. Pawlenty suggested that the government would recapture much of the lost revenue through higher levels of economic growth.

A spokesman for Mr. Pawlenty said after the speech that the former governor opposed any changes to individual tax deductions or credits, suggesting that he would leave intact the mortgage interest deduction and other tax breaks.

Instead, the spokesman, Alex Conant, said Mr. Pawlenty would get rid of business tax breaks. As an example, he pointed to Mr. Pawlenty’s recent calls for the elimination of subsidies for energy companies, including ethanol producers.

Mr. Pawlenty said his goal would be an economic growth rate of 5 percent a year, a level well beyond what the United States had been able to sustain for more than brief periods in recent decades.

The American economy is currently growing at a rate of about 1.8 percent.

Isabel V. Sawhill, a senior fellow at the Brookings Institution who served in the Clinton administration, said it would take extremely deep cuts in federal spending and the elimination of individual tax deductions to offset tax cuts of the size that Mr. Pawlenty is proposing.

“We need that money to reduce the deficit,” Ms. Sawhill said. “If we use up all of these loopholes and all of these spending cuts to pay for very large, new tax cuts, we will have nothing left over to deal with what is a huge, gaping hole between revenue.”

Ms. Sawhill also said Mr. Pawlenty’s assumption of 5 percent growth over a decade was “highly unlikely.” She said that “long term growth has rarely been more than in the 3-percent range. That would be near the upper bound of anything that’s realistic.”

In addition to broad tax cuts, Mr. Pawlenty said that as president he would seek temporary authority to freeze government spending and to impound up to 5 percent of the federal budget until the nation’s budget is balanced. And he called for cuts in programs that are better done by private companies.

“We can start by applying what I call the Google test,” Mr. Pawlenty said. “If you can find a good or service on the Internet, then the federal government probably doesn’t need to be doing it.” As examples he cited the Postal Service, Amtrak and federal home-mortgage agencies.

He also said he would overhaul the tax code, calling it a “9,000-page monstrosity” that is “chock full of special deals for special interests.”

Chris Chocola, the president of the Club for Growth, a conservative antitax group, called Mr. Pawlenty’s proposals “outstanding,” and said he “is exactly right in calling for cleaning up the tax code by instituting flatter tax rates and eliminating tax loopholes and giveaways.”

But Michael Linden, the director of tax and budget policy for the Center for American Progress, a liberal research group, called the plan “sheer fantasy.”

Mr. Linden said the drastically lower tax rates would cause “huge, massive deficits” by reducing federal revenues to historically low levels. And he said that Mr. Pawlenty’s promise to reduce federal spending to only 18.5 percent of America’s gross domestic product would force huge cuts in programs and services.
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