Club for Growth

Fred Thompson's Record on Economic Issues

Club for Growth Releases Sixth Presidential White Paper
Fred Thompson Senate Record is Generally Pro-Growth

Washington - Today, the Club for Growth released its presidential white paper on Republican presidential candidate former Tennessee Senator Fred Thompson (see PDF). The sixth in a series of white papers on the pro-growth records of presidential candidates, the attached report provides an extensive summary of Fred Thompson's economic policies during his eight years in the U.S. Senate.

"Fred Thompson's eight-year record is generally pro-growth with an excellent record on entitlement reform and school choice and a very good record on taxes, regulation, and trade," said Club for Growth President Pat Toomey. "His belief in a limited federal government is demonstrated by his numerous votes against government intrusion in the private sector and increased federal spending. His fondness for Tennessee pork aside, Thompson consistently voted against increased spending and new government projects, at times, one of only a handful of senators to do so."

The white paper provides an in-depth look at Thompson's strengths and weaknesses, giving the Senator credit for supporting the flat tax and for sponsoring legislation for Social Security personal accounts at a time when few would touch the issue. At the same time, the white paper explores Thompson's enigmatic record on tort reform and takes the southern Senator to task for his instrumental support of McCain-Feingold, questioning why his belief in limited government doesn't extend to government's regulation of political speech.

"Given his recent doubts about McCain-Feingold, Senator Thompson will have to clarify his current position on political speech," Mr. Toomey continued, "and explain how he would deal with our expensive tort system given his philosophical opposition to comprehensive tort reform. That said, Fred Thompson's overall record contains the hallmarks of a pro-growth economic conservative."

---

 

Taxes

The Club for Growth is committed to lower taxes-especially lower tax rates- across the board. Lower taxes on work, savings, and investments lead to greater levels of these activities, thus encouraging greater economic growth.

Over his eight years in the Senate, Fred Thompson generally supported broad-based tax cuts while opposing tax increases. These include:

• Voted for the 2001 Bush tax cuts
• Voted for repeal of the Death Tax
• Voted for capital gains tax cuts
• Voted to require a supermajority to pass tax hikes
• Voted to reduce the amount of Social Security benefits subject to taxation
• Voted against waiving the Budget Act to allow for a cigarette tax hike

Thompson was a forceful proponent of tax reform, lambasting the IRS as "mismanaged" and "wasteful," and a strong supporter of the flat tax. In fact, Thompson was the only senator to vote to table an amendment proposed by Senator Dorgan that took the flat tax off the table during a budget debate. "The problem with the Dorgan amendment is simple," Thompson declared in a press release the following day, "it puts you on record against a flat tax. I think a flat tax is one of the options that should be considered as part of the debate on comprehensive tax reform."

Unfortunately, Thompson's record on taxes is not perfect. In 1997, he voted against a Gramm amendment that would limit non-defense discretionary spending and apply the savings to lower taxes.

 

Spending

The Club for Growth is committed to reducing government spending. Less spending enhances economic growth by enabling lower taxes and diminishing the economically inefficient political allocation of resources.

Fred Thompson's record on spending is generally impressive. Aside from a fondness for Tennessee pork, Thompson was a strong proponent of streamlining government and eliminating waste. When he first entered the Senate, he joined a bipartisan group in sponsoring legislation hoping to put an end to corporate welfare. In 1996, he sponsored legislation to institute a biennial budget that would allow time for the Senate to exercise oversight on the spending process. He also often voted for measures to limit spending and against costly government programs. These include:

• Voted for the line-item veto
• Voted for the Freedom to Farm Act in 1996, which reduced, and aimed to phase out, farm subsidies while diminishing distortions to the agricultural economy
• Sponsored an amendment in 1995 and 1996 against a pay raise for congressional members (though he supported a pay raise in 2002)
• Voted for welfare reform
• Voted against a 2000 amendment that would provide a prescription drug benefit
• Voted against the Farm Security Bill in 2002 that sought to increase agricultural subsidies with market-distorting payments, undoing the progress of the 1996 act
• Voted against $2.35 billion in agriculture assistance

Senator Thompson often joined with a minority of his colleagues in voting to strip wasteful projects from the various spending bills. These include:

• 1 of 23 senators to vote for an amendment to eliminate funding for programs carried out by the National Endowment for the Arts
• 1 of 29 senators to support eliminating $2 million in construction funds for a Smithsonian Institution storage facility for specimens stored in alcohol
• 1 of 26 senators to vote against extending ethanol subsidies
• 1 of 31 senators voting to strike a $2.5 million earmark for coral reef mapping off the coast of Hawaii
• 1 of 24 senators voting to remove $50 million for the construction and renovation of facilities at the National Animal Research Laboratory in Ames, Iowa

As impressive as the above list is, Thompson was fiercely protective when it came to his own earmarks. His congressional website boasts of the federal dollars he was able to "snag" for his Tennessee constituents, including $25 billion in highway funds; $70 million for the Tennessee Valley Authority; $2 million for the Tennessee River; and $23 million for the Spallation Neutron Source project. Thompson felt so strongly about preserving funding for the Tennessee Valley Authority, he fought to exempt funds for the TVA from the balanced budget constitutional amendment in 1995, carving out a new category of "constitutional pork." And though Thompson supported and voted for the presidential line-item veto, he fought vehemently to undo President Clinton's veto of two Tennessee projects.

On balance though, Thompson's consistent votes against many popular spending projects are redemptive. After all, it is hard not to give credit to a senator who was 1 of only 3 to vote against increased spending for juvenile crime prevention programs and 1 of 5 to vote against $200 million for school safety programs. Such minority votes were not uncommon for the Senator. He was also 1 of only 2 senators to vote against an additional $16 billion in healthcare funding and 1 of 7 to vote against $7 million worth of grants for anti-violence programs. A few parochial indiscretions aside, Thompson displayed a general willingness to put the federal government on a sorely needed diet.

 

Free Trade

Free trade is a vital policy for maximizing economic growth. In recent decades, America's commitment to expanding trade has resulted in lower costs for consumers, job growth, and higher levels of productivity and innovation.

Over his eight years in the Senate, Fred Thompson voted for many free trade agreements and was a proponent of America's increased participation in the global economy. Although this strong record contains a trouble spot or two-such as his votes for nonbinding, symbolic measures in support of conditional tariffs on Japan in 1995 and to revoke normal trade relations with China in 1997 -the list of his pro-free trade votes is long and encouraging:

• Voted to extend trade benefits to sub-Saharan Africa
• Voted for the Africa Free Trade Act
• Voted for normal trade relations with China twice
• Voted for normal trade relations with Vietnam
• Voted for Trade Promotion Authority several times
• Voted to kill an amendment that would prohibit reducing tariffs in cases where an anti-dumping order exists
• Voted against an amendment requiring an environmental agreement with sub-Saharan and Caribbean countries before trade benefits could be received
• Voted against an amendment requiring a side agreement on labor standards with sub-Saharan and Caribbean countries before trade benefits could be received

 

Entitlement Reform

America's major middle-class entitlement programs are already insolvent. The Club for Growth supports entitlement reforms that enable personal ownership of retirement and healthcare programs, benefit from market returns, and diminish dependency on government.

Fred Thompson has been a reliable proponent of entitlement reform, supporting health savings accounts, voting for welfare reform, and voting against a measure that would expand Medicare.

Recognizing the need to reform Social Security, Thompson offered a bill in 1999 that would allow "all working Americans to divert a portion of their payroll taxes to a personal savings account that they will own and can pass on to their heirs." This is especially praiseworthy, as it came at a time when conventional wisdom suggested that Social Security personal accounts were political poison. When few others would touch the subject, Thompson showed a willingness to take on a political sacred cow on behalf of a cause that is critical to the future of America's economy and to the goal of limiting the size of the federal government.

He also voted for a number of other measures that would encourage or create personal Social Security accounts:

• Voted to increase the retirement investment options for railroad workers to include private equities, while simultaneously cutting their payroll taxes
• Voted for a Social Security lockbox
• Voted for an amendment to express the sense of the Senate that any federal budget surplus should be used to reduce the Social Security payroll tax and to establish personal retirement accounts

 

Regulation

Excessive government regulation stymies individual and business innovation necessary for strong economic expansion. The Club for Growth supports less and more sensible government regulation as a critical step toward increasing freedom and growth in the marketplace.

Fred Thompson came to the Senate with a deep-seated federalist philosophy that guided many of his positions. He played a key role in introducing several measures that sought to reduce government's regulatory nightmare, which Thompson tallied at 130,000 pages filling more than 21 feet of shelf space. In 1996, Thompson sponsored the 10th Amendment Enforcement Act to keep the federal government out of "issues that are best resolved at the local level." This fervent belief in a limited federal government also led Thompson to cast votes to decrease government's role in the private sector. These include:

• Voted for prohibiting an increase in CAFE standards
• Voted against expressing the sense of the Senate to increase the minimum wage
• Voted against the Patients' Bill of Rights that would allow the government to impose a set of onerous mandates on insurance coverage instead of allowing individuals to make their own decisions about healthcare plans in the marketplace
• Voted against requiring utilities to generate 20% of their electricity from renewable energy facilities by 2020
• Voted to kill an amendment that would establish a $2,500 cap on credit cards issued to an individual younger than 21 years of age
• Voted to exempt small businesses from liability under the Patients' Bill of Rights
• Voted for an amendment that would allow governors to waive federal standards for renewable energy production if the additional costs proved too burdensome to consumers
• Voted against legislation mandating a national standard for drunk driving
• Voted against legislation banning guns within a school zone

There were, however, several aberrations in Thompson's approach to regulatory votes. These are his vote for Sarbanes-Oxley, along with all of his colleagues; a 1998 vote to ban internet gambling, along with 89 other senators; and a 1997 vote to table an amendment requiring congressional approval before President Clinton could implement the American Heritage Rivers Initiative which would jeopardize private property rights.

These few indiscretions notwithstanding, Fred Thompson approached regulatory votes with a healthy distrust of the federal government and an admirable respect for states' rights and private enterprise. As he declared on the Senate floor, "States are not mere appendages of the federal government to be called upon to do the federal government's bidding every time we think we've got a good idea."

 

School Choice

The Club for Growth supports broad school choice, including charter schools, voucher programs, and tax credits that create a competitive education market including public, private, religious, and non-religious schools. More competition in education can only lead to higher quality and lower costs.

Throughout his eight years in the Senate, Fred Thompson was a faithful supporter of school choice, arguing in 1995 "that our elementary and secondary educational systems need to be restructured. Such restructuring can be achieved by privatizing a major segment of the educational system-by enabling a private, for-profit industry to develop that will provide a wide variety of learning opportunities and offer free competitive choice." Thompson voiced his support for vouchers that are "universal, available to all parents, and large enough to cover the costs of a high-quality education."

In 1997, he voted for a school voucher program in Washington D.C. In 1999, he was 1 of only 13 senators to vote for a proposal that would give $1.8 billion a year for three years to establish a pilot voucher program, paid for by eliminating certain subsidies for ethanol, oil, gas, and sugar. Thompson also supported a 2001 amendment by Judd Gregg to create a pilot voucher program.

 

Political Free Speech

Maximizing prosperity requires sound government policies. When the government strays from these policies, citizens must be free to exercise their constitutional rights to petition and criticize those policies and the politicians responsible for them.

Regrettably, Thompson's admirable record in so many areas is marred by his failure in the area of protecting free speech. Though Senators McCain and Feingold are more often associated with the Bipartisan Campaign Reform Act of 2002, Thompson was the next senator to sign on to the bill and was instrumental in achieving its passage. Though he acknowledged "the First Amendment right of people to give money to candidates," Thompson had no problem running roughshod over the right of groups to air their political views in his pursuit of the impossible goal of removing money from politics.

To make matters worse, early in his career, Thompson voted for a bill that provided federal candidates with taxpayer subsidies for campaign spending, in exchange for voluntary campaign spending limits.

Since announcing his presidential aspirations, Senator Thompson has admitted that McCain-Feingold has become riddled with loopholes and has distanced himself from his previous support, saying, "I'm not prepared to go there yet, but I wonder if we shouldn't just take off the limits and have full disclosure with harsh penalties for not reporting everything on the Internet immediately."

More recently, when Sean Hannity asked Thompson if backing McCain-Feingold was the "right decision in retrospect," Thompson replied: "Part of it was, and part of it wasn't." He elaborated, supporting repealing a ban on issue advocacy ads because "that's not working," but continued to support limitations on individual contributions.

While Thompson's recent pangs of doubt are somewhat encouraging, his doubts are not motivated by a strong First Amendment philosophy, but the realization that McCain Feingold isn't working. One has to wonder if this erstwhile supporter of McCain-Feingold has truly learned his lesson, or would he impose even harsher restrictions on political free speech to rein in the aforementioned "loopholes?"

 

Tort Reform

The American economy suffers from excessive litigation which increases the cost of doing business and slows economic growth. The Club for Growth supports major reforms to our tort system to restore a more just and less costly balance in tort litigation.

Thompson's position on tort reform is a bit of an enigma. At first glance, his record contains a mix of both good and bad votes, though many of these bad votes are better understood in light of Thompson's federalist philosophy. To his credit, this former trial lawyer voted against the McCain-Kennedy Patients' Bill of Rights; to exempt pro bono healthcare professionals from malpractice liability; and for the Securities Litigation Uniform Standards Act, requiring all class action securities lawsuits involving more than 50 parties to be filed in federal court.

The majority of his votes though, were against measures seeking to discourage runaway lawsuits. He voted multiple times against amendments to provide liability protection and limit damages, including:

• Voted to kill an amendment that would limit punitive damages to twice the sum of compensatory damages; place limits on attorney's fees; and require lawsuits to be filed within two years of the discovery of an injury
• Voted against a bill that would cap the liability of businesses from damage caused by Y2K-related computer problems, though Thompson voted for a conference version of the bill that extended liability protection to businesses with 50 employees or less
• Was 1 of 7 Republicans to vote against a Dole amendment to limit punitive damages in civil cases
• Voted to table an amendment to limit non-economic damages for pain and suffering in medical malpractice suits
• Voted to table an amendment to raise the standards to require "clear and convincing" evidence in medical malpractice cases involving labor or delivery of a baby if the doctor had not provided prenatal care

Thompson's belief in a hands-off federal government is sincere to the point where he was the only senator to vote against liability protection for teachers and volunteers. As Thompson explained numerous times during his eight years, these votes and others stemmed from a firm belief that the federal government should not meddle in matters best left to the states.

In a recent blog post in defense of his 1998 vote against a cap on attorney's fees, he argued that "I did not come to the Senate to review billing records from lawyers in private lawsuits. For the record, I oppose the federal regulation of any fees negotiated by two competent parties at the state and local level. This goes for lawyers, doctors, butchers, bakers, or the occasional candlestick maker. Even if excessive fees offend congressional sensibilities, there are other remedies that make far more sense than the federal one."

At the same time, Thompson's votes demonstrate an inconsistency that calls into question his federalism defense. While he voted for the Securities Litigation Uniform Standards Act, he also supported a Sarbanes amendment that would have weakened the Act by narrowing the definition of class action suits. Thompson opposed several bills capping punitive damage awards, but voted for the Common Sense Product Liability and Legal Reform Act of 1995 that did just that. He voted against liability protection for volunteers and teachers but for protection for pro bono healthcare professionals.

While Thompson's federalism argument is laudable as a means of reducing the impact of the federal government in private transactions, the fact that he has also not supported or suggested any meaningful lawsuit limitations at the state level raises the question of whether he appreciates the damage that excessive litigation does to our economy. It would be reassuring if, as a presidential candidate, he proposed solutions to our litigation crisis, even if they fell short of comprehensive federal tort reform.

 

Summation

Senator Thompson's eight-year record in the U.S. Senate demonstrates an admirable commitment to limited government and free-market principles. His record on entitlement reform and school choice is excellent, while his support for lower taxes and free trade is very good. On Social Security reform in particular, Thompson courageously supported personal accounts at a time when few politicians were willing to risk their necks taking on the third rail of American politics.

His record on spending (save the occasional pork project) is generally impressive, as demonstrated by his votes to restrict the growth and reach of the federal government. On regulation, too, Thompson voted generally against government intrusion in the private sector. Many Republican politicians talk about limited government and the principle of federalism but Thompson exemplified those ideas, often voting against bills that would have made it easy for a political opponent to paint him in a negative light.

While this strong federalist philosophy casts a redemptive light on his opposition to tort reform, it does not fully excuse or explain a number of his votes. His persistent federalism also makes his role in the passage of McCain-Feingold all the more disappointing. It is difficult to reconcile Thompson's fervent belief in a limited government with his enthusiasm for increasing government regulation on political speech. Thompson has never adequately addressed this contradiction and will have to do so. His recent doubts over the legislation's efficacy are encouraging, least of all because all politicians make mistakes, and rare are those willing to admit their own.

Posted at Andrew Roth at 9:34 AM | TrackBack