HH: I’m joined now by Pete Roskam, who’s a great congressman from Illinois’ 6th district, which includes the wonderful city of Wheaton. I have to say that, because so many Wheaton grads listen to this program, Congressman, that they’ll be happy.
PR: I know that, and I hear from them all the time.
HH: It’s great to have you on. Thank you for joining me.
PR: Thanks, Hugh.
HH: We’re talking about Ways And Means, and when you guys are going to get around to, you know, the Senate said 79-20 they want the medical device tax gone. When do you think the committee can give them the opportunity to put up or shut up in the Senate?
PR: Yeah, look, I mean, it’s a calendar question that will be left up to the chairman and the majority leader. But what you’re sensing and what we’re all feeling is this incredible opportunity, and that is this consensus around the repeal of the medical device tax. Remember, there was a reluctance at the very beginning when Obamacare first came in, and there was a feeling of well, you don’t want to improve Obamacare, right? You don’t want to deal with that. But I think the page has now turned with the reelection of President Obama, and so the name of the game is let’s focus in on these incredibly weak areas, and look at it like a Jenga game, and to go at some of these foundational things. The medical device tax is inextricably linked to the long term plan of Obamacare. And if you can do a body blow at one of those major funding sources, you can have an impact over the long run.
HH: So Congressman Roskam, in terms of timing, some of your colleagues are worried about pay for, that oh, if we repeal the medical device tax at 2.3%, we won’t be able to pay for it right away, so we have to wait for comprehensive tax reform. What do you make of that argument, because to me, it’s missing an open door that the Senate said walk through.
PR: Yeah, I don’t think they’re mutually exclusive. Look, if you’ve got an opportunity where you’ve got consensus in the United States Senate, which has been the place where nothing has been happening for the past four years, and now all of a sudden you’ve got some Senate Democrats that are seeing the wisdom of moving forward, I think a lot of House Republicans have an interest in repealing it and putting it on President Obama’s desk, or linking it up to some must-pass piece of legislation. I think that there’s a lot of opportunities here, and they’re not mutually exclusive goals. The Senate, or the House Ways And Means committee is going to continue to push forward, and will produce a tax reform product that will be then, you know, under consideration. But I don’t think they’re mutually exclusive, and you can do both and.
HH: So if that is the case, how quickly do you think, and you know, Ways And Means passed a repeal of the medical device tax last year, Congressman Roskam. How quickly do you think you could bring it forward this year, because I actually think if the Republicans in the House got giddy up here, when you came back from Easter break, you could deeply embarrass, and maybe even move Senate Democrats to a repeal if it’s a stand alone bill. What do you think?
PR: Well, to your point, it’s gone through back normally through regular order, right? I mean, that is the call of the day, through the normal process. So it’s, you know, Erik Paulsen, member of Congress from the St. Paul-Minneapolis area, is the sponsor of the bill. He’s got a tremendous amount of co-sponsors. So in direct answer to your question, Hugh, if there’s a decision that gets made, it can happen in a matter of weeks or months. It’s just a matter of calendar, timing, a decision from a strategic point of view to move forward, and the likelihood of getting it actually through the Senate, as opposed to some sort of game that the Senate has. So are you a Senate Democrat and then all of a sudden you’ve got your one roll call now, where you can go back to your constituency and claim that you’re in favor of the repeal of the medical device tax, and can you play some sort of hijinks game on what the House would send over? The other thing is, remember, you’ve got to make sure that there is a commitment on the part of the Senate to move the medical device tax repeal alone, and not load it up with some other tax hike or some other agenda item that the Obama administration wants.
HH: Let me ask one of my guests in studio with me, Congressman Roskam. Tom Loarie is executive chairman of Mercator MedSystems about how important it is to move quickly on repeal, because you know, we’re talking to a lot of congressman today, Tom, and a lot of them want to say you know, we’ve got to be deliberate here. How important is it to be done quickly?
TL: It’s extremely important. We’re sending $100 million dollars right now, every two weeks, to Washington, D.C. I’m in the start-up world. The funding for start-ups has critically been damaged over the last decade. It’s gotten worse, and it’s due to things coming out of Washington, not just this. I spent last Thursday with the prime minister of Ireland, who has been touring the West Coast trying to encourage companies to come over to Ireland to set up shop. And they have been very successful. A number of VC’s are moving over there. So you see what’s going on, is there’s momentum building to try and make sure, first of all, we’ve got to have capital to do what we’re doing. This is taking capital out of our pockets to invest in our young companies.
HH: Pete Roskam, I’m sure that resonates with you. Do you think your colleagues, though, on the Democratic side or in the Senate will hear or feel that?
PR: Well, look, I mean, as I mentioned a minute ago, the Senate Democrats in the past have demonstrated a real high capacity to talk one way and to act another way. And I mean, this would take this point and push it a little further. The competition of other countries around the world isn’t lost on House Republicans. That’s why we’ve moved forward, and we’ve got a draft language now to move forward, change from an international tax system to a territorial tax system for exactly this type of concern. And you know, Hugh, at the intro, you mentioned that I come from Illinois, which is a fiscal basket case right now in comparison to the neighbors around us that have made better financial decisions in moving forward. So the fungibility of capital is the point that your guest was making, and this idea that somehow the United States can continue to live on a past reputation, and somehow think it’s going to attract capital around the world, is a false premise. And to the extent that Senate Democrats finally decide to get that and focus in on it? We welcome them to this side of the equation.
HH: Tom Loarie, go ahead.
TL: So one thing that I think gets lost on people back in D.C. is that we are going to see, according to Gallup, an increase in the world domestic product from $60 trillion to $200 trillion over the next 30 years. That’s a lot of jobs. We also, the, Kishore Mahbubani from Singapore was on TV this last Sunday, and he talked about the Asian middle class growing from 500 million to 1.7 billion. These things are drivers for health care. And to me, everything from my industry standpoint is it’s, there’s obstacles for us to participate, and the growth, forget about the fungibility of the capital. The other issue is are we as a country going to participate in this growth?
HH: Congressman, last 45 seconds to you.
PR: Look, 95% of the world’s consumers are outside of the U.S. And part of the big challenge is an economic literacy effort, and now stick with me for one second, so that employees of the very companies that you’re talking about are able to articulate how important it is that their worldwide American companies are positioned to compete in world markets. And many times, people who are employed by the very companies that we’re talking about are unable to articulate that in a public debate. That’s got to change, and if it does change, and continues to change, we can make some good changes for the future.
HH: Congressman Pete Roskam, have a great Easter. We’ll continue to, that’s what we’re doing today. That’s why we’re doing a whole show on this. That’s for joining us from Illinois. Have a great Easter.
End of interview.