GOP Primary Debate for
House of Representatives-District 2

One week from today, Utahns will go to the polls to choose candidates in the Republican Primary. Tonight, we begin a series of debates on the major issues in the races. This evening, we begin with the candidates in the race for Utah's Second Congressional District. Incumbent Merrill Cook is seeking a third term. While Cook brought home record-breaking amounts of Federal money for transportation, he's been dogged by allegations of irrational anger that have weakened him in the polls. Challenger Derek Smith is hoping to unseat Cook. A political newcomer with no prior experience, Smith has made his name as a dot.com entrepreneur and has bounded upward in the polls, even conducting a part-time campaign and having almost no name familiarity.

Tonight Merrill Cook and Derek Smith join KUER for a discussion on two top issues - Social Security and education. We begin with the candidates' solutions for how to cope with the coming bankruptcy of the Social Security System expected in 2037. Smith's plan, as most, aims not to effect current or near-term retirees.

MR. SMITH: I also would be opposed to any solution that would involve an increase in the payroll taxes that are already involved in funding the system, so I'm supportive of the notion of allowing we who are paying into the some system some latitude to be able to invest a small portion of these funds in a personal account, something that would go into a range of investment options, perhaps not unlike the way we choose a 401K plan that would allow us to gain better than the rate of return that our Social Security is currently earning and most estimates put that around one to two percent. Well, over a long period of time, from 1926 to '96, stocks have returned have returned an average of over seven percent and there could be a mixture of bonds, T-bills. I think that the important aspect is it needs to be up to the individual, it needs to be voluntary. If they don't want to do it, that's fine. But if they do, this could make a very meaningful impact. This whole discussion about Social Security reminds me a little bit about a number of years ago, I traveled to India, and as we got off the plane in this central Indian town, thousands of these little children came up begging for money and I started giving them some and the people said I was with said, "No, don't do that. They're lower cast members. They're paying their dues for something that happened in a past life." And I thought, "Wow. This is a pretty convenient operation you have here, kind of a convenient philosophy." And since then, I have often thought that the way the whole Social Security System is imposed is it says, "You have to do it this way and the government will make all the decisions and the government will decide what's best for you." It's really not effective. I want a system that empowers us as the citizens to be able to impact our retirement.

KAT: Okay. Congressman Cook, how would you answer that question, the changes that you would make to deal with the expected bankruptcy of Social Security.

CONGRESSMAN COOK: First, we need to lock-box, protect the trust funds that are already in the Social Security trust fund. There's 1.9 trillion that's been borrowed from that and I think we need to start restoring that over the next 15 years at least. We could get most of that returned and that would go 75 percent of the way towards the solution to this, but I think there is merit in allowing younger workers to have additional contributions put in, voluntarily, and use part of the surplus that the Congressional budget office, which is now over 3, actually they're saying almost 4 trillion dollars over the next 10 years instead of the 2.8 trillion dollars they were estimating just a few months ago, to match anyone that would voluntarily want to add another 2 percent to their payroll and it would not upset in any way the amount that are contributed to employers that match it. This would be additional, voluntarily, and the incentive would be that we could match this with additional money from the surplus, and then I think, we could allow some of that money to be invested in higher yielding, but again, I don't think we should allow, at this time now, investing in the stock market. I think privatizing Social Security as my opponent is suggesting would be the death knell to Social Security. But I do think that if we have a voluntary program, match with surplus funds, and allow higher yields in treasure bills, we might have an answer to the 25 percent of the problem that isn't being addressed by the lock-box legislature.

KAT: Let me ask you two questions. Why do you think privatization would be the death knell for Social Security first, and second, it sounds like you just said that maybe you believe some of the Social Security surpluses should go back into the fund and other surpluses should go into the fund to help. So talk a little bit about how you're going to restore that as well as the other question.

CONGRESSMAN COOK: This is a major problem. What I'm saying is that with surpluses projected at 4 trillion dollars and with no one proposing any more than like 800 billion over 10 years in tax cuts, we have an opportunity to restore the 1.9 trillion to the trust fund from surpluses that are being generated right now, and if we can't solve the Social Security problem and the Medicare problem with this kind of a surplus being generated over the next 10 years projected, and it keeps getting larger with every month, whether it's the Office of Management and Budget or the Congressional Budget Office projecting this, then there's something really wrong with this. But we don't solve that by just privatizing. I want to point this out. The strength of the Social Security System is that everybody is included in it. I think there are a lot of wealthy people that don't need their Social Security check, but if you cut them off or if you allow them to go on to their own program, like many would like to, you endanger the program. The strength of Social Security is that in every Congressional District there are members of Congress promoting it, because it's popular with everyone. And of course, there are a lot of people that don't need it. A lot of people think there ought to be _____. But the strength of it is that we're all included and having to contribute to it and getting the benefit from it.

KAT: Okay. Mr. Smith, why do you think the privatization is the way to go, that that doesn't undermine the sense of what it is, and then also if you'd address how you would use Social Security surplus.

MR. SMITH: Sure. To be clear, I'm not talking about privatizing all Social Security. I'm saying let's give individuals the option, the voluntary option of being able to invest a relatively small amount of that money privately themselves.

KAT: You're saying two percent approximately.

MR. SMITH: That's the number that's been bandied about, right? And just to put that in perspective, an average person making $30,000 here in Utah, we're talking about something like $80 a year. For somebody making $100,000, we're talking about $250. We're not talking about… The cost of some Jazz tickets or a vacuum, so I think that we can trust people to make a decision on that amount of money, and what they need to understand is through the power of compound interest, if they will do that, it could make a meaningful difference for them. In terms of use of the surplus, now, that money belongs to the taxpayers and we should give it back to them.

KAT: All of it.

MR. SMITH: All of it.

KAT: The Social Security surplus you're talking about or other surplus?

MR. SMITH: My general philosophy is these surpluses belong to the taxpayers. They should go back to the taxpayers. There are certain obligations that I think that the Social Security System have we need to go address, like the notch gap problem where we made commitments to people along the way and we need to make good on those, but beyond that, I support tax cuts.

KAT: Okay. But let me clear this up now. The Social Security surpluses are helping keep the fund solvent or they're contributing to the amount of money that will be there later for people when more people come along and retire. But you're saying that that amount of surplus should go back to people who are currently paying Social Security, that they should be paying less Social Security.

MR. SMITH: We've increased the amount of payroll taxes over and over and over and over and over on people paying into the system. I'm saying, if we have surpluses, I can understand that there's a debate about wanting to go back and pay off some of these IOU's from the government, but that money belongs to the taxpayers and I think that we should consider looking at tax cut proposals, just to roll back some of those payroll taxes. I believe that tax cuts now would stimulate the economy and help bring in more total revenue to be able to deal with that and completely solve the problems associated with funding Social Security, right?

KAT: But if people are paying less Social Security now, won't that just make the problem happen sooner, the bankruptcy problem come along sooner and make it worse?

MR. SMITH: Will it? The problem is projected for when the people start retiring. Having the tax cut now won't make them retire sooner. I think we need to look at how can we get the economy going as strong as it possibly can so that we can be better positioned with the macro issue when the Baby Boomer's start retiring in mass. If we're sitting on $150 billion in surplus in the system right now, we could do a lot of things at a macro economic level to stimulate the economy, and hopefully, grow it to the point that we could completely resolve the underfunding problem.

KAT: Congressman Cook, are you in favor of any kind of tax breaks with any of the surpluses in the Social Security Fund or the general ledger?

CONGRESSMAN COOK: First of all, it's very obvious that my opponent doesn't really believe in the Social Security System with the statements he just made, because of the 4 trillion dollar surplus that's being projected by the Congressional Budget Office of the OMD for that matter over the next 10 years, fully 2.4 trillion of that is Social Security surplus money. As he did get correct, about $150 billion this year alone in surplus money. I'm certainly not talking about giving any of that Social Security Trust Fund surplus back in tax cuts. His proposal is more radical than any tax cut proposal I've heard in Congress and I support tax cuts. A tax cut on the order of $700 to $800 billion over the next 10 years is a big tax cut, but that kind of a tax cut would not take any of the Social Security Trust Fund money. I think if we tried to take Social Security Trust Fund moneys and cut back and return those to the taxpayers rather than to the people that we've promised them to and that's the Social Security recipients, we will go bankrupt in Social Security before the decade is out. Those surplus funds are absolutely vital in maintaining the integrity of the Social Security Trust Funds at this time.

KAT: Going to education. Both of you are calling for reduced Federal role in education and I'd like to talk about some specifics about that. Mr. Smith, you said you want to cut the Federal strings on education. Describe exactly what strings you're talking about and what you want to cut in terms of Federal involvement and Federal influence.

MR. SMITH: Currently, the Federal government is providing only 6 to 8 percent of the money coming into the state, but they exercise a very disproportionate influence over how state and local level decision making occurs, and in fact, the Clinton administration is out there touting the idea of having a National Superintendent of Schools, which I vehemently oppose. My proposal specifically is that we need to [set up] block grants to get the money down to a state level and I believe that will remove a lot of the undue influence that the Federal government has over the state and that can in turn push more decision making down to a local teacher and parent level where I think it can be most effective.

KAT: So for example, say on the money that goes to help poor, low income families, low income children with reading and math, how would you change - I mean how would a block grant change… Would you still have it be targeted to reading and math, you'll have it be targeted to low income and criteria for who that money goes to or how would you restructure it?

MR. SMITH: I specifically do not think that the Federal government should be involved in mandating how the money should be used in terms of reading or math over any other important subject, so I think there should not be any mandates from them. Now I want to be very clear. If we're talking about things like Title One moneys to go to disadvantaged students, I'm not saying that I don't think that they need help. I'm saying get the money down to the state level and administer those programs at the state level.

KAT: Would you still want the money then to target specific kids, low income kids, or disabled kids and have criteria for who meets that or just have all the money come back and have the state decide who gets it.

MR. SMITH: It would be fine if it were targeted in that way, but that really should be something that gets administered at the state level. I mean the statistics are that four million kids nationally falls through the cracks on that as it is, because the Federal government is picking and choosing what's in their point of view the highest risk or the most at-risk schools or school districts around the country or areas of most critical need. If we're going to target that group, get the money to the state level and let the state take care of how exactly to spend it in touch with their local needs. I just don't think that it's efficient or effective for the Federal government to try and mandate all of that at a Federal level.

KAT: Congressman Cook, what kinds of things do you want to see reduced. You've talked about bringing 90 percent of funding back to the state. What sorts of things do you want to see eliminated or cut or changed?

CONGRESSMAN COOK: There's approximately $38 billion in the Federal Department of Education. I think 95 percent of that money would be better spent and the moneys directed better at the local level and that's why I've supported the legislation we did pass in the House. [Scholars] to classroom legislation that does return that money to the local government through state block grants and I think that my opponent agrees on that. Where we vastly disagree is the statement, at the convention here, that he wants the Federal government out of education entirely is going to be hurtful. It's going to be hurtful to higher education and to our K-12 public schools, because of three very critical programs. Title I, Title V, and Title IX assure the disadvantaged and also disabled kids get help and we could not have a school lunch program throughout Utah without Title I money. They're very, very important. Title V makes sure that our universities are able to accept very low income students and minority students who couldn't afford to get into universities, state or private, otherwise with the Pell grant programs, which are very successful, have to be administered from the Federal government. It's impossible to arrange any kind of a Pell grant system through a state government as my opponent thinks ought to be done. And I think Title IX, which I think has been important. Sometimes the Federal government has overstepped its bounds on Title IX, but I think gender equity I think is a very important thing in education. They have had cases around this country that have gone way to far, but again, throwing the baby out with the bath water is what I'm trying to avoid. In other words, we want to straighten up and tighten up the Federal programs, but we don't want to throw the baby out with the bath water and I think that Title IX programs that try to assure gender equity in our public schools and our university system and even private schools that get Federal grants is a good program.

KAT: Isn't Title IX also Indian education?

CONGRESSMAN COOK: Yes. That's right.

KAT: And you support that element of it as well?

CONGRESSMAN COOK: Absolutely do. Yes.

KAT: Do you agree that these are the areas where you disagree Mr. Smith? I mean are these programs you would want to eliminate? What do you mean when you want to take the Federal role out and then talk about these specific kinds of programs?

MR. SMITH: Thank you. What I said at the convention and what I still stand by is that I don't believe that the Federal government should have a role in telling our teachers how to do their jobs. I want them out of the business of mandating curriculums, mandating how teachers and what teachers teach. I support, by and large, the objectives in these Titles, but I don't believe that the Federal government has managed them appropriately, but money ought to come to a state level and the state should, by and large, administer those programs and my opponent has been up on the air trying to extrapolate from these statements that somehow I don't support school lunch for children, which is absolutely ridiculous. My daughter participates in school lunch and that's just a complete distortion of what I've said, and further, it's my understanding that the school lunch program is administered by the Department of Agriculture, so it has no bearing on this discussion.

KAT: You mean that your daughter participates in the school lunch for low-income children? Or you mean that there's a lunch at school?

MR. SMITH: No. There's a school lunch program at her public school. Right. KAT: Let me go back. What about the Pell grant issue? Is that something that you think, as Congressman Cook raised, is something that has to happen at the Federal level or not?

MR. SMITH: Well he's saying things like there's You know, he's speaking in absolutes. That it can't possibly at a state level and I just fundamentally disagree with that. Any time I hear somebody claim something like that can only be done by the Feds, I just cringe, because that just speaks to me of mismanagement and bureaucrats in charge. I think that the states could absolutely administer a program, and sure, we'd have to sort out some issues when a student is from one area and applying to college in another. We'd have to sort those things out, but we handle similar territorial issues in many aspects of our state government.

KAT: Can you give me an example of curriculum that's controlled at the Federal level? I have heard that there's not any curriculum requirements. Can you give me an example of one that I know of?

MR. SMITH: Well I can give you an example of HCON RES 151, which my opponent put forward in Congress, expressing the opinion of Congress that Federal funds going to train teachers should focus first and foremost on math and science as opposed to history or reading and I just don't think that any part of the Federal government, including the Congress, should be involved in mandating at a local level how we train our teachers or what we teach our children and I think that there are numerous examples of the Congress and the Department of Education trying to make those kinds of mandates.

KAT: Congressman Cook, do you want to respond?

CONGRESSMAN COOK: Well I think there's an important Federal role in terms of equity and access, but I've never thought that the Federal government should be trying to set up the curriculum. I don't think they have so far. I think the Clinton administration probably would like to be able to do that and I have stood there and tried to oppose that at every juncture. But there are important moneys under the Federal program that do relate to teacher training. We know, from the work I've done on the Science Committee, that our math and science scores are very low in this country compared to other industrialized countries and even though I agree with my opponent that we should not be trying to design the curriculum at the national level, I think it's very, very important and I'm very proud of the legislation I helped get passed that will emphasize improved teacher training the math and sciences to help our, particularly high school kids and even kids in the lower grades, develop like their peers are developing in Europe, for example, in math and science skills, which are lacking right now in American education and here in the state of Utah.

KAT: We're running short on time, so let me, Did you want to make a rebuttal?

MR. SMITH: I did. I guess I fundamentally disagree, because I think that what we need to be doing in the schools, although I don't that the Congress should mandate this or the Federal government should, my personal opinion is we need to be teaching our kids how to learn and that fundamentally needs to start with reading skills and they can do self-directed learning at an astonishing pace, and this has been proven over and over and over in countries around the world and with the home-schoolers in other areas into the sciences. I've really got to disagree that those are the areas that we should try and emphasize first.

KAT: Okay. We're running low on time, so let me have you just spend, briefly, 30 seconds on vouchers for parents who allow their children to go into some other private school instead of the public schools.

CONGRESSMAN COOK: I support tax credits for private education to bring competition, but I don't really support the one size fits all voucher program ____ bring in a lot of extra bureaucracy. I don't think they would advantage us here in the state of Utah, but I do think the tax credit for private education makes sense and would allow a little more competition, which I support, to the public school system.

KAT: Mr. Smith.

MR. SMITH: I don't like the voucher concept, because it implies that the money first goes to Washington and then you get a voucher back and I think that any time you head down that path, you invite Washington to put the strings on that voucher and I would like to see something in the direction of a tax credit that would give parents that ability to experiment with home schooling, private school, parochial school, whatever they feel is appropriate for their kids.

KAT: One last question for each of you before the closing statements and I'll give you an opportunity to address some of the problems that have arisen in the past for each of you and I'll start with you Congressman Cook. You know the issue has been anger. Do you have a problem with anger? Do you need some anger management courses? Are you doing something…? What's going on with you?

CONGRESSMAN COOK: Every time they talk about my temper makes me mad. I was trying to get a laugh with that with John [McKeeney]. I'm passionate about issues. The idea that I…

KAT: But we're not talking about issues, we're talking about interrelationships.

CONGRESSMAN COOK: Yes. But I think those are made up stories. I'll have to say that. Again, there's been E-mails that have been perpetuated. No one's actually seen this behavior. The person that claimed had stories for it across the world about my performance, the Republican Party Headquarters absolutely denied that I said anything like what's being reported or acted the way it was reported. I admitted the use of two foul words, but certainly in a controlled manner, and only when this particular person became a consultant for one of my opponents in this race did he all of a sudden embellish that story, and again, accepted by the press with great credibility. The fact is that Congress is an area where there's intense feeling and you deal with a staff, I've dealt very appropriately with my staff. We've got great staff and great staff relationships and this image that's been painted of me because of two staffers that were fired has been outrageous and it has been wrong and I think it's only been perpetuated, because I have not been the favorite of party insiders that want to glom onto those stories and promote the candidacies of other people by continuing to run me down in the press. I think it has been outrageous. The situation with my firing two staffers, using a couple of swear words in the Republican Headquarters has turned into a national scandal when no such thing has really been in reality.

KAT: Mr. Smith, your issues have been - issues have been raised about your business, Cambric, that you started before the current one, I-engineer, and liens for back taxes and contract disputes. Do you want to address what the problem was and how did it get so far to become a lien instead of you just saying, "I can't pay my taxes. Let's make a deal."

MR. SMITH: That's a great question, because we actually tried that. We had some cash flow issues. We were owed hundreds of thousands of dollars by our customers and we had a period of time there where being a new start-up business, we didn't have access to credit lines and bank lines. We approached those agencies and tried to explain our dilemma and said, "Look. We're faced with being, with having to turn these employees out on the street. These are people who live paycheck to paycheck and going out of business or maybe you could give us some latitude here," and not only do they not comprehend what it's like for a small business person, they act kind of predatory and that is one of the reasons that I wanted to go to Congress. I vowed way back then that if I ever had the chance to try and go provide some voice for the small business in Congress I'd like to go do it for exactly those reasons, because these enforcement agencies at a Federal and a state level have no concept of what it's like for a small business and that is the level of enterprise that is the backbone in the economy, both nationally and here in the second district. That's who is creating most of the jobs.

KAT: Well the IRS isn't very pleasant to individuals who can't pay their taxes either, but they don't slap a lien on unless a lot of time goes by where the person is recalcitrant or doesn't respond. I mean…

MR. SMITH: That's actually not the case. They're often pretty quick on the trigger with the liens. But in this case, we were trying to go the extra mile to work things out with them and explain the temporary difficult situation that we had and we offered to them that they could put liens on some of our computer equipment so that they could see that yes, we have every intention of making these payments to you and this is a way of making you feel more comfortable that we'll take care of those things.

KAT: So you offered that as a solution.

MR. SMITH: Yes.

KAT: Now I'll just have you make closing statements, if you'd like to have two minutes apiece to make a closing statement, and by a coin toss, we determined that Congressman Cook would go second, so Derek Smith, you may make the closing statement first.

MR. SMITH: Let me just give the listeners a little background. I was born in Salt Lake. My father was in the military so we spent some time in Germany. I attended the University in Utah and I've been in business here in the Second District for about 15 years. We've created numerous jobs and it has been a tremendous experience learning what it's like to start businesses from scratch without any outside funding and learning the needs of the small business people. I'm also a father. I have three kids - one in the public schools and two headed there shortly, so I care passionately about trying to improve our education. I've also been active over a number of years with the Salt Lake County Sheriff's Office. I went through Peace Officer Standards and Training with them, went through Emergency Medical Technician training up to level two and was involved on a volunteer basis throughout our county helping people who were injured - fallen climbers, people caught in avalanches, out looking for lost children, so I've done quite a bit of community service and I fell that when I looked at this race I did not see our incumbent being able to hand on to the seat, so I feel very passionately about being able to keep the seat for the Republican Party, so I threw my hat in the ring and we've picked up a lot of momentum. I think people are very interested in my ideas about lowering taxes and improving education by getting the Federal government, so I believe that I can win and we have a primary coming up here Tuesday and would really appreciate everybody's support.

KAT: Merrill Cook, your closing statements.

CONGRESSMAN COOK: Thank you Kat. I want to thank KUER for having this little exchange. I believe that I deserve re-election to a third term, because of an outstanding record of performance. I have performed as the independent-minded person that I am with loyalty to the core principles of the Republican Party, and sometimes that hasn't always been okay with others in this game of politics, especially the high priced consultants and lobbyists that feel that I am just not a go-along guy and I have real problems with the campaign/finance network as it exists, but I've stood up and I've taken ideas from the party. My voting record shows that I vote 80 percent with the Republicans and about 20 percent with the Democrats, because I vote where I think the idea is in the best interest of the constituents of the Salt Lake Valley and no party has the monopoly. I just happen to think that the Republicans have the best plan overall, but that is my independent mind has created trouble for me politically. I won't deny that. And when minor things happen, and it is a minor thing in staffs to terminate two or three individuals and I've terminated two and it is a minor thing to let out with a cuss word, but these have become nationally significant scandals, because I don't have other Republicans in the state of Utah willing to stand up for me on those things. But you know, the Speaker of the House and the leaders of the Congress know that I'm a future leader of the Congress. This is why they're supporting me strongly in this embattled time that I have, because they know I'm a real mover and shaker on the tax limitation ideas. No one has been more successful in getting transportation funds back here to Utah to work for us and nobody has done any better than I have in terms of ensuring the integrity of Social Security and the Medicare system in the Congress.

KAT: Merrill Cook and Derek Smith, thank you very much for joining us tonight.

BOTH CANDIDATES: Thank you.

KAT: Radio West is a production of KUER News. Our debate was recorded by operations director, Barry Holt. Our executive producer is Doug Fabrizio. If you have a comment about the program, call our listener comment line at 581-6777 or E-mail us. We're back again tomorrow with another in our series of debates. This time the candidates for the Attorney General's race, Frank Mylar and Mark Shurtleff.