Duncan D. Hunter speaks at Tool and Machinsts Assn Event, Kearny High

San Diego Sustainable Future (2010-08-24) Michael Russell

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More Info: CA 50 Congressional District

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(After introductory remarks)

What's wrong with our trade practices is that right now, we don't have any business... basically your small business owner can do better when it comes to trade practices than A Phd out of Harvard who majored in economics -- President Bush, President Clinton, President Obama, -- it does not matter because our trade cycle is downward cycling -- downward trending and it has been going on for 20 years -- or probably longer. But what's happened is we don't have a single business person who can say "I'm a CEO of a nation... I'm president whoever, and I'm going to make a business deal with another country -- I'm going to make sure it is fair for American business" because any business owner here can't go to China and say "We're going to change our trade deal with you guys, you can't subsidize your products anymore."

Okay but an American president can't do that. We have to. We basically give any other country whatever they want, at any price and try to trade with them and it doesn't work.

To STIM -- we've talked about stim all day long -- I've been looking at these neat robots, science and technology -- I know Bob Taylor from Taylor Guitars pretty well, and Bob Taylor support all the shops in San Diego County, especially East County, trying to get Shops back into schools -- It's that simple, because with these budget cuts...

I'll tell you something too, it just came out today, Virginia's got a $400 million ... the state of Virginia has a $400 million surplus... $400 million. Okay... They haven't fired a single teacher. Fairfax country, where I was about 15 years old... lived for about 4 years outside of D.C. -- They have one of the best school systems in the entire nation, and they haven't laid off a single teacher, they've been hiring. They've been opening shop classes. They've been opening labs. And they have a $400 million surplus. California has got a $25 billion deficit that we're running, and that's why we're supposedly laying off teachers and closing down shops.

It's not a federal issue, it is a state issue, but the way the state has been managed is a good reference point for the rest of America about how not to handle your money, how not to run a state government, what not to do. Because California used to be the leading edge that people would want to follow. No More. California fell off the edge and the rest of the nation may fall off that cliff or they'll end up like us and they are, frankly. But they have a $400 million surplus -- and they have it for the reason that they are not ruled by big labor, frankly. They'll don't pay $300,000 per year pensions. Anybody in this room getting a $300,000 per year pension? No, I'm not either. What I will get right now is $8,000 or something like that.

You have city managers, city planners, people working for caltrans, firefighters, police, retiring and making $300,000 a year, because it is all based on their last year and labor groups do not want to change that, and there is no one in state government that will stand up to it.

Anyway, so there's a few ways -- California has shut down schools, excuse me, firing teachers, getting rid of shops, to when it comes to manufacturing in general, the question is whether there is going to be a job for a kid that can do this stuff when they get older -- will they become engineers, will they become physicists, when they want to go weld at NASSCO, -- the boilermakers union, they build navy ships, they came into my office today -- they actually support me -- whether or not they are used to supporting a Republican -- they are about to lay off about 300 people -- we're spending money on everything else but we're cutting defense spending. These are people who have been welding for 20 years, master welders, master craftsmen, master steelworkers and they're looking at getting laid off too.

So, the question is what are we doing here to California, and it is pretty sad what we are doing right now and hopefully California can fight it's way out of this by growing business instead of kicking it out, to making sure there is a job for these guys later on down the line and jobs for us now. Because there has not been a focus on that.

Congress currently and in the past was always let China manipulate its currency, they've let them subsidize, and we've been letting them get away with it and now they're the number one holder of U.S. debt, so we're going to keep letting them get away with it, frankly, that's probably what's going to happen -- I don't think anything has the guts to stand up to them and say "Stop -- we're going to change this trade agreement, we're going to -- you guys can't subsidize any more, and for you American companies, you're going to have to start buying American goods, especially state contracts, county contracts. We don't do that now. Your taxpayer money is going toward foreign goods -- you're buying Chinese goods with your money.

I know for a fact that the boilermakers came in today and said that the coastguard uses some chips in certain sensors that the Navy uses that are made in China. They're not integral things where the missile won't work without those, but your taxpayer money is still being used to buy foreign products.

So there are obviously things we have to fix. Right now there does not seem to be any way -- I find the way probably the -- I'm not a perfectionist -- it's not a fair trade. I believe in free trade and fair trade level playing field -- actually let us compete don't subsidize. What you do we're actually going to do back to you, it's called meter-trade -- you subsidize, we're going to subsidize --

A Ford Taurus, by the way, costs about $60K in Japan. $60,000 for like a Taurus. Why is that? It's because they tariff everything that we send over there. No one in Japan is going to buy a Taurus, they are going to buy all of their cars. That's why my Dad's good at -- he had a bumper sticker that said "Buy American and Create Jobs"

And let me leave you with this, and I'll take questions about specific things.

One of the ways I like to look at this, and what I was going to say was, I'm probably in a very small group of Republicans who are not total free traders. You have a lot of folks in Congress who would have traded with the Soviet Union in 1982 or 84. The way to bring the Soviet Union down is by injecting them with capitalism so let's buy their cheap goods and lay off American workers.

You have total free-traders out there. For instance, there's a free trade bill coming up with Columbia. I'm probably going to sign on to that, and try to pass it, because of the narco-terrorism there, the islamic infiltration that they have there, and the way they've allowed us in and allowed us to pump them and stem the drug flow at the source into America, that's a good thing.

South Korea, I'm not going to vote for that. India, I'm probably not going to vote for that either. Because those are manufacturing jobs. We will never make another shift commercially in this country virtually outside of the Jones act where internationally people can buy free trade with South Korea -- these guys will never have jobs if that's what they are interested in doing because they're not going to be here. South Korea makes 400 chips a year, we make 40 a year, total in the whole country. They are way more efficient, they have more people doing it, and they know how to do it better because they have been doing it.

The U.S. has not produced commercial chips right now, we don't sell them to anyone. We are not able to compete with them because our processes are -- the way that we do things are not suitable a way (?)

So anyway, uh, that's that, there is obviously a whole lot of things we've done -- it's unfortunate, it's something we're pushing on, in fact I brought a piece of paper that says the different bills I've signed onto -- the main two are Democrat bills -- I've signed onto this year -- trying to get more manufacturing here. That's one way I stand with the American worker and say hey, let's create jobs.

So let me leave you with this one last thing, I always like to say, people always say the reason we have free trade, what it does good for us is we have cheaper products. You have a hammer at Wal Mart, it used to cost $5 now it's $2.99, right. so that's a good thing. Who wants to pay more for a hammer? Anybody? No! Who wants to pay more for a ... you can kind of go down the line and say this thing and the answer to that is -- if you are unemployed, you can't afford anything. Period So it doesn't matter if the hammer is $5 or $2.99 in China or $5 made in San Diego. Trust me, choose the $5 hammer made in San Diego and you're choosing a quality of life for an entire region, and that's what it is all about...

---

creating a quality of life, realizing you're actually buying American for a... a ... an actual reason, purpose, and doing it for that whole chain of events that happens when you're buying an American product. The person working, all the middlemen, all the people who drive it and drop it off, taxes that will come in locally from making that item here in San Diego and buying it here in San Diego, it's a huge chain and it's very important that we've lost that in this nation.

I don't know if anyone has driven through South Carolina where they used to do all the textiles -- they use to make all the clothes -- all the clothes, everything we used to wear came from that region. You drive through there now, they're all brick buildings, they're all shuttered. Giant brick factories, shuttered. Whole towns are dead, done. They're all gone. We've outsourced all of our textiles. They don't make any clothing here at all. In fact there was a stupid situation that -- probably three or four years ago -- I was still in the Marine Corps -- we were buying Erickson -- It was when the Army when through berets -- remember that, when everyone went through beret's not just special forces and rangers. We were going to buy the berets from China. We had a contract with China to buy the American soldier's berets. That's how -- kind of -- you would think that's an obvious one, right? You would think, who would let that pass, uh, but that's the kind of stuff that actually gets through, it's not easy to stop, because bureaucrats making decisions that are not exporting you. And congress doesn't vote on where you buy a certain product from. So you have bureaucrats in Do D or in other areas -- City of San Diego -- you have people, nameless people, faceless people, who work in big buildings downtown who decide where the money is spent. Same in the County, same in D.C. You can't hold them out there it is just bureaucrats and sometimes it becomes uh the local governments that have to step up and override that and that's what we're talking about.

But it's tough -- the total free traders -- the people who believe in free trade with everybody pretty much run everything that's how Wall Street -- Wall Street will tell somebody, if you go to them and try to expand, Wall Street will say, you can expand if you go to China. We're not going to think about giving you any money at all even though you're fully profitable. Go to China, then we've give you the money. So uh, anyway, things we're working on in those problems.

Anyway, thanks for having me here. It isn't all bad. There has to come a point, I think, and I think it's happening now, when the American Citizen says hey, I've had enough, and I've actually looked at this and I don't believe that having a cheaper hammer is going to save American jobs. And we're going to vote for the people who are not going to want the $2 hammer anymore. That's going to create a whole lot of jobs and create a whole lot more money for us.

Anyway, that's it for me, and I'll be happy to take questions.

Man1: I have a question.

Yes sir.

Man1: Alright. So basically, for manufacturing, it seems like for it to fix itself, we're going to have to take them to the cheap. People in America have to somehow start to make some changes about taking the cheaper route. for the good of the country, right? Do you think it will be interesting to have some way to know say if someone did not take one for the team -- and I'll just leave that

Hunter: I'm not sure what you mean.

Man1: I'll just say that I'm a manufacturer -- these guys all have to make money. They have two choices, cheaper, or more expensive. One of the ways I look at that is that solution is if they have another way to look at it -- almost like a credit or an incentive -- maybe even a web site where there is what they did this week that are there to help America, in order to help reward them more in different ways.

Hunter: Incentivize

Man1: yes.

Hunter: The thing is that we would not have to take one for anybody if uh, if we had fair practices. So what's not going to happen is because the same guys who want total free trade with everybody, except for us, basically, everybody else, we could get deep into this, if you want to talk about the value-added tax -- a VAT -- every country has a VAT except for us. So we say we're going to trade with whoever -- we don't have a tariff -- we're not going to tariff anybody's goods, but they've got a VAT, well that's a tariff. We could, as Americans, go into when we go into this free trade agreement say we're exempt from your VAT. And they would say, okay, I mean this is a business deal there is nothing set in stone where we have to allow another country to run roughshod.

President Bush screwed this up big time. President Bush went in there and said, we're giving away the farm.. whatever you want, you can have, and you can trade freely here in the U.S., we don't care if you have a VAT or not. He didn't have to do that. He could have said, hey, you guys have a VAT, bring that to zero, we don't have a VAT, and we'll trade with you. If it really is zero-zero and they it's OK. But but, on top of that, I don't think anybody has to take a hit for anyone because if you simply made it more attractive to do business here, and penalize those people who moved offshore, that would take care of a whole lot of the thing. But the other side of this thing is we have one of the most, so pretend now that we're all business owners. Let's just say -- you probably are some business owners -- let's pretend I'm a business owner too, okay? Why would I want to stay here? Why would I want to stay in California, one. Why would I want to stay in California? It's fantastic, you've got the beach, you've got everything else. You can go surfing, bike riding, go somewhere in the winter time, do it all in the same day, if you want to in San Diego or L.A. right? so that's one. But simply on business matters, why? You wouldn't want to. Unless you had shipping, unless you worked with the Navy, Marine Corps, I'll bet it's still cheaper to do work in Arizona, and truck your stuff out here. Or Nevada, than it is to have a place here. So why California is a business owner so why America has a business owner? Because you are a patriot? If you're a manufacturer of goods -- it's cheaper to do it in China and sell it back here, cheaper to ship it back here, cheaper to go over there set up shop, and then ship it back. So why is everybody here?

Person: The market's here.

Hunter: The market's here, but your business does not have to be here. Your production facility if you are trying to save money to make money, would be in China. So the answer is that we are kicking our own guys out. I would argue almost on purpose, we all know it's not easy to do business in California, it's not easy to do business in the U.S. -- we know where everybody's going and we know why. So if we wanted to fix it, you could do it easily. Why is Microsoft in Ireland? Tax breaks. It's hugely business friendly. I mean, tons of companies went to Ireland. My wife is Polish and she immigrated here. So she has a bunch of Polish family and friends -- not by any means well-to-do people in Poland, they're the migrant workers in Ireland. They go to Ireland by the thousands. Polish do -- to go work. That's where the jobs are and Poland let's anybody who is not a felon to work on stuff. so, Ireland does. So anyway, the answer to this is pretty simple, it's not simply done, or it would have been done, obviously. Uh, I'm just a freshman congressman. It's interesting that there are people who have been then for ten, twenty years, who don't realize this... If you want to grow jobs, if you want to grow the economy, you simply have to make it more business friendly. That does not mean cap and trade. Cap and trade would destroy manufacturing. Done. I mean anything with a carbon emission would be taxed. Anything. Whether you make paint, you sell paint at home depot, or whatever. This shop class. I don't know if it would get taxed or not. It produces carbon emissions here, probably. By doing something... they would get taxed here. Cap and trade would tax anybody who makes anything. Like the last bastion of what we have of American manufacturing would get taxed more. That's cap and trade.

Yes -- interrupt me at any time...

Q: Aren't the asset values and labor costs, aren't those much more significant and you'd have to get those down to make it more business friendly, anywhere in the United States... a business friendly place? Somebody can't live here -- you can't buy your lease is expensive. -- real estate is expensive.

Hunter -- You're talking about housing and everything.

Q: Any of the assets... any of the ... to go into manufacturing to actually live here are overstated...

Hunter: San Diego is one of the most expensive -- San Diego, New York City.

Q: Take Ireland for example. They were able to induce people to come. Aren't our hands tied to induce people to come in?

Hunter: We have the highest corporate tax rate in the world.

Q: Yeah but our budget is overstated so we need -- you can't cut taxes and

Hunter: I disagree with you, and here is the reason why. It all comes down to this, and we'll step way back manufacturing and cost of living. Step way back from that. So what are the people willing to pay for what services. Citizens. How fast do you want the police to come to your house? How fast do you want the ambulance to go to your house? How many firefighters do you want at each fire station? How many teachers do you want, how many kids in each classroom? And it's not just firefighters, police, and education. How much do you want the DMV to charge? How long do you want the DMV lines? Go through all of these things look at the services you -- and find out from the American people -- I think it is time for a re-evaluation -- so you look at everything. Services, what type do you want and how much are you willing to pay. If you want a lower corporate tax rate, I'm not talking for Wells Fargo, Bof A, I'd be happy if it is not necessarily the banks, but Oracle, Microsoft. I don't care if they have a high tax rate, go hire more people. But if you are willing to accept less, less welfare going out, less of anything that comes from the government, then you will create more jobs. That's simply how it is.

If the government, whether it is state or federal, cuts, like it says it is going to, so, if they say we are going to cut taxes, but on the other hand, you have to do with an extra ten minutes in the DMV, or we are going to abolish the DMV and do it by Internet, then how much money would California save? If we abolish the DMV and did it by Internet. So there are ways to do it so you can lower business tax rates. Look what is coming up. The "evil Bush tax cuts" -- the tax cuts that only gave rich people tax breaks. Those will expire in January. That a 2.6 trillion dollar tax raise, the biggest tax increase in American history. If you let that happen, you;re affecting the business climate here in the U.S.

Businesses right now still don't know if they'll be a big sinner in that because I'm not in charge of -- my party's not in charge of Congress right now. Democrats don't want to extend them, they're getting major pressure, I mean how do you look at business, from their standpoint right now, saying ,we're going to drop those tax breaks right now.

And this isn't just Oracle. You talk to someone who owns four dry cleaners in El Cajon, who grosses $300K to $400K a year. Pays out $250K, makes $120K to $150K -- nets after taxes $80 to $90 grand. -- Those are the "rich people" who we're talking about, because those people pay taxes as a sole proprietor, they're not a big corporation, Okay? And alot, I think the numbers are like 60% or 53% of small businesses file as sole proprietors means you get taxed as if it is personal income base. So that person is looking at this and saying wait a minute, I'm going to get hit with this personal tax increase... that person is not Bill Gates, making 80, 90 grand a year -- that's nothing, we all know that. Cost of living is huge out here.

So there are ways to affect it, but it's going to take everyone coming together saying, hey, we're willing to accept less to create more jobs and make us more of a free market.

yes maam.

Q: I have a real problem with this whole welfare thing. I don't get the generation that is taught this welfare. I don't understand why is it so hard to understand that if someone is going to be on welfare, why are they not out their doing public things that can be done, like cleaning the bathrooms and cleaning the beaches and the roadsides.

Hunter: You're talking about what? (Or maybe you should talk to my wife) [Laughter]

Q: I don't understand. ideally, if someone is out there doing something they don't want to do, the whole climate is off ... we need an environment where we can get the work done.

My mother in law was out in Arizona -- she was in a little tiny town and they opened up a PO box and there is three generations there one only 15 years old and getting her first welfare check. And my mother-in-law almost blossed them, she was so disgusted.

The other thing is I work in the medical industry, and these kids are 18, 19, 20 years old getting free medical care because they are on the second and third baby and that Medical, medicare and they don't pay even $5. They have three cell phones they can call them on, but they have to pay only $5.

... you know they might think twice about canceling appts and showing up but they don't have to come up with anything, they get it all for free. The whole mentality of this whole free... nothing should be free, I'm sorry.

Hunter: Here's what is going on, let's get philosophical for a minute. I agree wholeheartedly with you, okay? That's a state issue, for the most part, the welfare in California. California hands out welfare like candy and requires nothing. The unemployment extensions that congress was passing, at my level, I voted for the first set -- I'm not sure how many days, I think 90 days. There were three more sets or two more sets, and I voted against them because I found out, and this is me, I'm my own constituent too, I'm not a big fat-cat here, so I know people who have been staying on unemployment, that was on CNN. They just live on unemployment, welfare combined with a few more things, they don't have to work. So, that's a California issue. There's some number, California takes like a very large number of the welfare recipients number of people in America for a small proportion of people than any other state does. It's an interesting thing but I'm with ya, but here's what's happening. You've now created an entitlement country. Not everybody, but about half. I think the number is that about 49% of people don't pay income taxes. Okay? So what happens when that number hits 51% or 55% it means that uh why don't those people just vote in those folks that will never require them to pay an income tax? And that's what, it was some communist, I don't know who it was, that America will fall when the American citizens realize that they can vote themselves everything. And that's what is happening now, especially in this state. California, you can vote yourself welfare, you can vote for the right people, you can vote yourself a pension too. And that's what has happened here, and it's time to step back, you see, what's good about right now? Here's what I think is good about it, here's the shining light in all this. We've gotten to a point now when things are very bad. And everyone is looking at what is our national debt, about 13 trillion dollars -- our deficit this year is about 1.7 trillion dollars -- we're spending more than we can spend taxes are going to be going up. We've kind of hit a stop sign here, and we're going to look at things and go alright, time out, what are we willing to do to exchange for America being solvent again. And one of those things is going to be stopping those unemployment expenditures. It didn't get stopped. Every time we voted on it, it got larger... 20 billion dollars more -- 20 billion dollars more, we kept extended it and extending it. I mean, we aren't part of -- the Republicans aren't the party of no, no matter what you hear. we all voted yes for the first couple of sets, some voted for all four. But after one... hang on a minute, it's time for people to start doing stuff here. Welfare is the exact same thing, it's got to get cut. You have to have a carrot and a stick. And the stick is, you're not getting any more benefits if you don't go to work or you don't find a job.

Q: I've got a question. I want to take some pictures with your kids. If we're going to do that...

Q: what was the biggest surprise of being a freshman congressman?

Hunter: The inability to affect things when it didn't come to money being involved. Especially in this administration. The inability to get in and speak to different secretaries, like, you know, interior secretary, secretary of labor, that was kind of the interesting part. If it does not have money involved, then those guys, the administration, and this goes for any administration, not just this one. If there is not money involved, the executive branch does not care what the congress says, whether it is me, or someone who has been there 20 years.

Q: When you guys pass something like the Sarbanes-Oxley act, do you really think about the impact that it has on companies, I mean, seriously.

Hunter -- That happened a while ago.

Q: right. But it seems to get worse and worse and the money and time that is spent on those audits and those

Hunter: take a look at the healthcare thing I think we just passed. It would require every company over $600 you do business with, you have to start filling out forms.

Q 1099

Hunter: That was in the healthcare bill we overturned that, or we're going to after the break, we're waiting on the Senate to. so that will be a change, there's going to be ... so the answer is "no"... this legislation has extreme, over-reaching features to it, and unintended consequences to it that nobody sees. That's why, overall, you kind of think to yourself, unless it is good legislation, if it is long and complicated, you're almost looking for a reason to not vote for it, because you know it has got unintended consequences. And most of this stuff does, especially the highly technical ways and means, the tax code, the healthcare bill, cap and trade, these things all have loopholes, they've all been singled out by some special interest group to be able to get through, and it's all very complicated. So unless you are an attorney and have legal team to sit down and read this, you can't really... that's why Pelosi said, "We're not going to know what this does until we enact it into law." That was her answer. Because you really don't know until people who are specialists in whatever branch or whatever bureaucrat whatever longer sadems, they say if this happens, you've got to do this and this and this, and here is what is going to end up happening. So that's why that is. So a lot of this stuff has unintended consequences and the point of good legislation is to be focused, direct, and simple, and actually solve the problem and not create more.

Yes sir.

Q: Just a comment. Is there any Republican candidate that my wife and I see that if he is a moderate, we're not going to vote for him. We will not play the moderate game, it is the worst thing for the Republican party.

Hunter: I'm not a moderate. Even though the boilermakers are supporting me. But would you rather have somebody in who votes with Nancy Pelosi, from a place like take Jersey, take Jersey, take parts of Pennsylvania, take parts of Michigan, parts of Illinois, more liberal areas, do you want somebody who, in the end, votes for your overriding beliefs... and this goes both ways. This is a bipartisan group. If you're one of the people who are super liberal, who are not going to vote for anymore moderate Democrats, vote for the moderate Democrat, vote for the moderate Republican if you have to, because that end vote, whether it be for Nancy Pelosi or John Bohener -- that's what they are going to vote on, and that's who directs everything. You see prior us seeing anything on the House floor, it goes through what's called the rules committee. We've been trying to pass a bill to televise the rules committee. Whichever party is in power controls the rules committee by a lot of votes. The rules committee decides whether you get five minutes to speak and argue on cap and trade, or five days to speak and argue on something that is going to affect tens of millions of Americans. So, you would think that if you believe in something, you would not mind arguing about it. Okay? But that's not how it is. The Rules Committee says -- it's run by Nancy Pelosi -- you get ten minutes of debate. As opposed to you get three days. So, if you have the moderate, you disagree on 30% of the stuff or 10% or 15% of the stuff, you're not going to find any free trader or protectionist Republicans. I'm not even a pure free trader. You're not going to find hardly any, I don't think, I know all the guys that are like me, me and the guys from Michigan... (laughter) the Republicans who hang out on trade deals, and we vote one cause they try to tackle us and to change our votes. But you aren't going to find, even I'm not going to find anybody who's 100% with me on this. I mean you have Republicans who want blood on their hands down -- you never find anybody perfect. What matters is that they are with you on the majority, especially when it comes to that final vote on who speaks, because that's -- whoever the speaker is runs all the little parliamentary procedures that date back to the 1700s that make us run the government the way that we do.

Q: I just the the winner is going to be the one giving the clearest contrast to the current administration. That person that stands the farthest away and stay there, and not just be a RINO -- Republican in Name Only -- you know and come back and be a moderate. and stand totally in that direction will be the clear cut winner.

Hunter: I'm not very fast, so I sort of stand where I do.

Q: I admire your support of the cubscouts and boy scouts. and Second, I know you have to run, if we have a particular issue that we wanna discuss with you, what's the easiest way to get ahold of you?

Here, Joe's got cards here. This is Joe Browning, great American, he used to be a publisher and a newspaper man. And now he's helping me. He has cards

My office is by Gillespie Field. so Hey, Thank you very much (clapping)