Rep. Kevin Brady on finding common ground on tax reform

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Rep. Kevin Brady on finding common ground on tax reform

House Ways and Means Committee chairman provides insight on 'Sunday Morning Futures.'

This is a rush transcript from "Sunday Morning Futures," November 26, 2017. This copy may not be in its final form and may be updated.

MARIA BARTIROMO, HOST: Good morning. As lawmakers return from the holiday, senators will decide the fate of the tax bill. And what will the president's successful Asia trip mean for your new year?

Hi, everyone. I'm Maria Bartiromo. Welcome to "Sunday Morning Futures" on this Thanksgiving weekend. As the Senate moves to vote on a bill that will reshape the country's tax code, some key Republicans could derail the whole thing. I'll speak with Texas Republican behind the tax overhaul, the Chairman of House Ways and Means Congressman Kevin Brady on tab. Plus, we will hear from Congressman Peter King one of the current GOP no votes in the House. He says this plan will have damaging effects on the economy and individuals. Later on in the program, author and journalist Gordon Chang joins me. I'll ask him about President Trump's successful trip to Asia and the decision to designate North Korea a state sponsor of terrorism as we look ahead right now on "Sunday Morning Futures."

And the GOP tax bill which would lower the rates across the middle class is now in the hands of the U.S. Senate. After the break, they will comeback this upcoming week and decide the fate is far from certain though as a few key Republican senators have already come out against this bill. Others say they are leaning against it. So, can the GOP get everybody onboard and be a successful tax plan and change the code? Joining us right now, the man behind the tax overhaul, Texas Republican Congressman Kevin Brady. He's Chairman of the House Ways and Means Committee. Mr. Chairman, good to see you again. Happy Thanksgiving.

REP. KEVIN BRADY, R-TEXAS, CHAIRMAN, HOUSE WAYS AND MEANS COMMITTEE: Thank you, hope you had a great Thanksgiving.

BARTIROMO: Well, listen, we want to talk about this tax bill. We know in the upcoming week the Senate is going to get down and dirty. Do you think that this bill when you all go to conference and you compare the House bill and the Senate bill, is it going to look much different? Tell us where you are, Mr. Chairman. I know there are things you're talking about these state and local tax deductions. You're talking about what Ron Johnson has a problem with the difference between the corporate rate and pass through rate. Give us your status check.

BRADY: So I'm really encouraged by how pro-growth both of these tax form plans are and again both of us are driving towards the agreement that we reached with President Trump earlier this year. I think there are some differences that we want to reconcile on the individual rates. The Senate has seven brackets, we have four. How we address our small businesses in a major way. We'll want to do the best we can there as well and then of course how we design and redesign I would say our international tax code so our companies can compete and win anywhere in the world including here at home. Those are three areas I know we're going to want to spend some time to find some common ground.

BARTIROMO: Yes, but what are you going to do with the fact that 6 million from Californians use the state and local tax deduction? New York as well feeling like they pay into the federal government a lot more than they get back. When the -- when the final bill is all said and done, ready for a broad vote, you're not going to get those people on board who say their constituents are seeing higher taxes like Peter King who we're going to speak with momentarily as well as others in California, Illinois. Is there room for movement on that state and local tax deduction, sir?

BRADY: So at the end of the day, I think we're going to be able to prove that we can provide tax relief for all Americans regardless of where they live and so we have been working very carefully with our high tax state lawmakers. I know too those high tax states are already rethinking how hard they tax their citizens because Congress is actually for the first time saying look, why don't we rather than have high tax rates and everyone just subsidize and pay each other's taxes, why don't we lower the tax rates for everybody and just pay your own. It is a new way of thinking, but we are working with our high tax state lawmakers to make sure there's real relief and at the end of the day. I think the House bill did a very good job of addressing this issue. I think we can do better and we pledge to work with our state, high tax state lawmakers to do exactly that.

BARTIROMO: And so you're saying is there is potential that you will make changes to meet the President's deadline. Obviously, his priority is getting this done this year. Here's what he told me just a couple of weeks ago Mr. Chairman watch this.

(BEGIN VIDEO CLIP)

BARTIROMO: Tell us where we stand on the tax plan right now?

PRESIDENT DONALD TRUMP: You know, there's a great spirit for it. People want to see it and I call it tax cuts so it is tax reform also but I call it tax cuts. It will be the biggest cuts ever in the history of this country. And I think that there's tremendous appetite, there's tremendous spirit for it not only by the people we're dealing with in Congress but for the people out there that want to see something.

(END VIDEO CLIP)

BARTIROMO: And yet, he wants that on his desk by the end of the year. You think you can do that even though Senators like Ron Johnson have an issue. They want -- he wants change in terms of the corporate rates, the business rates.

BRADY: Yes, so Maria I believe we can. I predict we will have a new tax code for the New Year and for a new era of American prosperity. We deserve it. Americans deserve a new tax code and I'll tell you whether you're a New Yorker or California, Illinois, we're continuing to see our jobs and our plants and our research march overseas it's time to end that and I think any Senator, any member of Congress who defends the status quo. Look I think Americans are hungry for a new code.

BARTIROMO: Let me ask you this Mr. Chairman. The President and you as well keep saying this really for the middle class. The tax cuts are going to impact the middle class and they are going to put more money in their pockets. We get that. But at the same time, we had an economist on my morning program this past week, Stephanie Pomboy from MacroMavens and she says look, the top 20 percent in terms of earners spend more than the bottom 60 percent. They're the ones spending the money and they're not really getting the relief because you've got the top end, in some cases seeing their taxes go higher because of this elimination of the deduction. Here is Stephanie Pomboy, I got to get your reaction, Mr. Chairman. Listen.

(BEGIN VIDEO CLIP)

STEPHANIE POMBOY, PRESIDENT AND ECONOMIST, MACROMAVENS: What's concerned me is that all of the focus has been on the corporate side which is great again. You know, we do need to reform the corporate tax code. It doesn't do enough for consumers, especially at the high end. I mean, I hate to say this and we've talked about it before but the top 20 percent to 60 percent -- they spend more than the bottom 60 percent of consumers

(END VIDEO CLIP)

BARTIROMO: What about that, Mr. Chairman? Are you cutting taxes on people who don't pay taxes and raising taxes on the people who pay taxes?

BRADY: The answer is no. We provide tax relief at every level under the House tax reform plan that we passed, 70 percent of the tax relief goes to those families making less than 200,000. Sort of that range of middle class from the low tax to the high tax states that we all worry about so we deliver in a good sense here. But we deliver tax relief at every level and you have to look underneath that rate itself because we're continuing the mortgage deduction, charitable deduction, the property tax deduction, we eliminate the AMT, we eliminate a number of those provisions. I actually did impact and raise taxes on our more successful Americans because we make those changes underneath the rate, you have to look more carefully than you did in the past. At the end of the day, I think everyone is going keep more of what they earned.

BARTIROMO: Yes, and I totally believe that moving the corporate tax rate the way you are hoping to will actually have broad impact and move the needle on economic growth. But let me ask you got to get to the spending side of this Mr. Chairman because you guys just passed a budget really narrow margin $47 trillion budget and yet, not a lot of spending cuts, sir. People are wondering when in fact the $20 trillion in debt that we talk about so much becomes a priority. When will that be, sir?

BRADY: Yes, you know, I think it is in this tax reform plan. Here is why. Look, every business that gets itself in trouble has to do two things and it has to cut its spending and has to increase its revenue. Tax reform is all about increasing that revenue and I also will tell you that just as taking a step back to a comment you made when you look at our high tax states. Many of them are also economic engines in the U.S. economy. So when you lower those rates so our businesses whether they're main street businesses or they're competing around the world can compete and win and reinvest those dollars back into the United States, all of which they can't do today. You're going to see growth in state and local revenues, you'll see it in individuals and families pocketbooks, you'll see it in higher paychecks along those main street businesses. So look, there is a lot from an economic growth standpoint that this tax code really drives.

BARTIROMO: Yes, look, you've got, you had $1.5 trillion to work with. That was what was agreed upon for your tax cuts. $900 billion of that are of the business cuts and I believe that because I do believe in the fact that when you create an environment for business that's more attractive they will in fact turnaround and invest and hire more workers. I get that but at the same time, when you're looking at this tax plan, people want change. But you do seem to have Lisa Murkowski now in the Senate on the plan, she is agreeing to eliminate that individual mandate. Do you think that makes it in the final -- in the final bill?

BRADY: Well look, we'll see. You know, we're anxious for the Senate to deliver on tax reform, how they do it, the design that they bring to the table. Look we're just -- we're just urging them and encouraging them on. The House, as you know, has passed the repeal of a mandate repeatedly so there's strong support over here in the House for it. And look there's a case to be made. This is all about eliminating taxes on low and middle- income families. And individual mandate does hurt many of those families who can't afford and don't want ObamaCare, so we're just encouraged the Senate is acting and we hope they deliver this week and really anxious to get to a conference and find the common ground.

BARTIROMO: Yes, it's going to be a big victory for you once you do pass this. Is the next priority infrastructure or welfare or what? What's the next priority when you look into 2018 once this goes through?

BRADY: Yes, I think both of those, Maria. You know infrastructure is a key part of our economy. We know more needs to be done but we need more workers, qualified workers. We think a lot of them are trapped in the government today so we're anxious to help them get to that good paying job.

BARTIROMO: Mr. Chairman, it's good to see you. Thanks so much.

BRADY: Thank you, Maria.

BARTIROMO: We'll be watching the developments. Chairman Kevin Brady there. The GOP lawmakers opposing the tax plan meanwhile say it will have damaging effects because it eliminates deductions for state and local taxes. It's being done at the expense of high tax states like New Jersey, New York, New York Congressman Peter King will join me next. And follow me on Twitter @MariaBartiromo, @SundayFutures. Let us know what you'd like to hear on the program. Stay with us as we look ahead right now on "Sunday Morning Futures."

(COMMERCIAL BREAK)

BARTIROMO: Welcome back. The GOP tax victory in the House puts President Trump one step closer to achieving the largest overhaul of the U.S. tax system in three decades but 13 Republicans join Democrats in voting against this bill sighting the elimination of the state and local deductions as one reason for their opposition. One then is New York Congressman Peter King and he joins me right now. Congressman, it's good to see you. Thanks so much for joining us

REP. PETER KING, R-N.Y.: You're very welcome Maria. Thank you.

BARTIROMO: So walk us through what the problem is here. I recognize that a lot of people use that state and local tax deduction, in fact when you look at California which is the largest user of it 6 million Californians use that deduction. What's the story in New York, how much will an average New Yorker's tax go up without that deduction?

KING: You know, we're still trying to compute that but it's definitely going to go up. I would say the average homeowner could have an increase of over a thousand dollars, maybe more than that to 3000. Again it's difficult to fully compute it right now but there's no doubt there will be increases. And believe me, I more than -- as much as anyone, wanted to vote for across-the-board tax cuts. I believe in (INAUDIBLE) tax cuts, I believe in John Kennedy's tax cuts, I believe the Bush tax cuts of the early 2000s. They work, but not at the expense of a whole region of the country and that's what's happening here. I mean, in New York, in my district alone, 48 percent of the people itemize and many of the homes, even though they're modest homes and the salaries are not that high you could have people paying 15, 20, $25,000 in combined property and state income taxes and obviously there's homes that are higher than that. So individuals get hurt and also the entire state is going to be hurt as far as revenue.

BARTIROMO: Is there any reason to believe that Congressman as much as this hurts and you are going to see your constituency higher taxes since they can't use that deduction anymore. Is there any reason to believe that this is actually the right thing to do because these high tax states hide behind the fact that they could use that deduction? I mean look at New Jersey. The new state legislative comes, the first thing -- by the way, the first thing Mr. Murphy said when he won Governor of New Jersey is I'm going to get going on my higher taxes.

I'm going to raise taxes on the millionaires and we're going to get that millionaire tax going and yet, after the news of the tax plan hits, the state legislature, the New Jersey Senate President Steve Sweeney says we're going to have to re-evaluate everything if the federal bill repealing the state and local tax deduction becomes law. I'm just saying that what's happening in Washington is concerning the hell out of me he says. So in other words, what I'm saying is over time, maybe the elimination of this deduction will get these governors and these assembly people to say you know what? I've got to cut taxes on a state level because they're sky high and they hide behind the federal government.

KING: Yes, but it's not exactly like that. I agree that Murphy coming to New Jersey, that would have been guilty of excess there. We've also gone through eight years of Chris Christie where he did try to put some controls on spending. The fact is there's always going to be higher taxation in states like New York and New Jersey because of the fact that we get short changed on federal revenues. We've gone over this before, but New York gets $48 billion less from the federal government and pays in revenues. Other states get twice as much, almost twice as much back as they put in. So we have to make that up somehow. If we can get that $48 billion back in New York, that would make it a lot easier for us to reduce the revenues or to reduce the -- excuse me -- the tax rates.

BARTIROMO: Right.

KING: So I mean, that's all part in there. What I'm saying is treat us all equally. And I don't think that it benefits the entire country when you have one whole region of the country and in fact having a redistribution of wealth away from us.

BARTIROMO: Yes -- no, I think you make a lot of good points Congressman. I know what you're talking about living in New York by the way. Let me ask you this. Do you expect the Senate bill to look very different than the House bill? Will the -- because Susan Collins said look, I think we should leave that deduction in there. What do you think stays, what do you think goes when Senators come back this upcoming week?

KING: I would hope -- first of all, I have great regard to Senator Collins and I'm glad she's brought this up because in some ways she's a lonely voice on the Republican side on this issue in the Senate. But again, she's said that she believes that it can be found to do it, maybe a slight adjustment in the corporate tax rate. But again I think the problem here was right from the start. They saw this large amount they could take and I was going to finance the tax cut. I mean they are talking about they can go up to 1.5 trillion and you know, 1.3 trillion.

They claim is coming from SALT. I mean, to me, it was like too easy a target and it's also from states that let's face it don't have that many Republicans in them. So it was sort of -- the money was there and you know, there's not going to votes for it anyway. So I think that was part of the thinking but Senator Collins, her vote is going to be essential for them to get to 50. They would probably have to get Senator Collins and I just hope she can hold out. I'd be happy to work with her on it.

BARTIROMO: Do you -- let's talk about the impact. Let's say hypothetically speaking the elimination of that deduction stays in the final work that goes to the President's desk. Are you expecting mobility in New York and New Jersey and California? In other words, a lot of people are predicting we're going to see an exodus if people leave high tax states. Why would you pay for example, what is it 57 percent when you look at state and local at 17 percent and the highest earners at almost 40 percent? 57 percent income tax, why are you going to pay that when you know you could go to Florida and pay nothing? So are you going to see an exodus of people that is going to depress real estate prices, that's going to mean you know, taking money away from education, so what do you think, impact?

KING: Yes, there's already been some of that but no, I've spoken with a number -- a number of business people, I guess they call themselves the 183 Club and that they would make sure they're out of the state, to move out of the state, so they won't have to pay the income tax and this is -- again, it was already developing but it's going to I think, I could see a mass exodus coming. You know, the whole week I've been home since this vote was cast. I've been hearing from rank in file Trump voters, people who own their homes and people who are really -- you know, hardworking wage earners, but I'm also hearing it from the business community. Big people on the business community who feel this is going to terribly impact them. And yes, they are talking about moving their address to North Carolina, Florida wherever.

BARTIROMO: Wow.

KING: They feel that something has to be done to this. And that they will have a compounding effect because it will be less state revenues available, that means local governments have to raise property taxes. It's really a vicious cycle. And again, it's going to be a massive tax cut for the country but it's going to be a big hit on one whole region of the country. I think -- I think it's bad. (INAUDIBLE) across-the-board.

BARTIROMO: Well, it certainly not the effect that lawmakers would like to see. Congressman, it's good to see you. We'll be watch the developments. Thank you so much.

KING: Maria, thank you as always. Thank you.

BARTIROMO: Congressman Peter King. We'll be right back. Stay with us "Sunday Morning Futures" right here.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: Today the United States is designating North Korea as a state sponsor of terrorists. Should have happened a long time ago, should have happened years ago. In addition to threatening the world by nuclear devastation, North Korea has repeatedly supported acts of international terrorism including assassinations on foreign soil.

(END VIDEO CLIP)

BARTIROMO: That was the president following his historic 12 day trip to Asia. The president declared North Korea a state sponsor of terrorism, called on the rogue nation to end its unlawful nuclear missile developments. Author and Journalist Gordon Chang says North Korea could have nuclear capabilities to hit the United States within nine months. He joins me right now. Good to see you, Gordon. Thanks so much for joining us.

GORDON CHANG, AMERICAN COLUMNIST: Thanks.

BARTIROMO: Why didn't it happen sooner than when the President deemed them a terrorist organization -- I mean, a terrorist state sponsor?

CHANG: There's a lot that goes into this. There's a very complicated definition of terrorism for purposes of this list. State Department needed to work through that and they just picked a time when they could also talk to Japan, South Korea, and China, all the countries in the region sort of laying the groundwork on the President's 12 day trip, so that's why it happened after the trip, not during the trip.

BARTIROMO: So tell me what the implications of this are, declaring them a state sponsor of terrorism means what in a practical manner?

CHANG: Well, there are a handful of sanctions that come into play when a nation is put on to the list. And you know a lot of these measures are not important in and of themselves and some actually duplicate sanctions that are already in place. But the important thing here is that the President has a long and consistent campaign to cut off the flow of money to North Korea. This just adds to the pressure. Also, it adds to the pressure of the sanctions that were put in place by treasury this past week, so this is important. We're starting to see that they're having an effect on North Korea. So for instance, junior officials in Pyongyang, part of the regime's favored class are not getting their rations from the special distribution channels at least according to anecdotal reports. But all the anecdotal reports are in the same direction that the regime is, just running out of cash. We're not there yet of course. It's going to take several months but the Trump's campaign to cut off the flow that's actually working now.

BARTIROMO: I see. So the President seemed to have a good trip. He came home talking about $250 billion in new deals between Chinese and American companies when he was in Beijing. How would you characterize the President's trip?

CHANG: Well, the trip was really good because he reassured allies and he got two very difficult friends of ours, the President Moon Jae-in of South Korea and Rodrigo Duterte, the Philippine President, there are our allies but they were moving in directions we didn't like. In Beijing, he sort wilted in terms of the public comments he had but behind the scenes, American policy was very resolute. We told the Chinese where to get off on a number of issues including arm sale to Taiwan and actually Chinese agents operating on U.S. soil. We told them to stop it. That's a very good thing because they've been here a long time, been doing a lot of things which are just inconsistent and actually a violation of American sovereignty. So the President's trip was really good, laid the groundwork for some important things that have to go on. You know, what goes on now is really difficult. He laid the groundwork.

BARTIROMO: I'm wondering what the sanctions mean though, really, because somebody mentioned to me the other day, look who cares about sanctions against North Korea? North Korea's leader does not care about his people. So what does he care that he's getting sanctions? Are they effective and do they work?

CHANG: Well they will work if the President continues putting pressure on North Korea's backers like Russia and China. And it's not just Russia and China. It's countries in Africa and around the region that are actually supplying money to North Koreans and through various means and the President worked very hard to do that to stop that. And so this is going to be important. It's not very sexy but it's a very sort of ground and pound game. You go to all these countries, you get them to close consulates, embassies, you get them to not import North Korean labor and to make sure that they don't sell certain items to the North Koreans. Treasury and Justice Department have a lot of work for them to do.

BARTIROMO: The President uses tough talk to make a standpoint and make a move. Is that working? I mean, what I'm visualizing right now is the enormous armada that we have off of the Korean Peninsula sitting there. I'm sure China doesn't like it, obviously, North Korea doesn't like it but it's basically sending a message. We are ready should you make a mistake North Korea. Is that right?

CHANG: Yes. Well, we have three carrier groups near the Korean Peninsula. Three carrier groups is important because with two you cannot conduct around the clock operations. With three, you can. Now the only issue there is some of those carriers have been on deployment for quite some time and are going to have to be withdrawn, but what it does is sends a message that we are prepared to strike if necessary.

Now, I think the President's pressure campaign will work over time. It will take maybe nine months to a year to do that but you know, basically what he's saying is that all the tools in the American toolbox will be brought to bear against North Korea. And for the first time, we've got a president who is willing to use all these elements of national power against not only the North Koreans but their supporters and backers around the world.

BARTIROMO: You're right. So do you think North Korea has shown any evidence that it's actually backing down in anyway yet?

CHANG: Not really.

BARTIROMO: Hard to say?

CHANG: You know, people say for instance they haven't launched a missile since September --

BARTIROMO: That's what I'm referring to.

CHANG: Yes. The Chinese I think stop them from doing that because in the run-up of the Communist Party's 19th National Congress, Xi Jinping, the Chinese ruler demanded absolute calm because he wanted to consolidate his position, didn't want anything to interfere with that. So I think that they told the North Koreans thou shall not. And also right now, the North Korean military is preparing for its winter training cycle. They don't launch missiles this time of the year.

BARTIROMO: OK.

CHANG: So I think it's a combination of things why North Korea has been so quiet in the last several months. The real test will be February when they really start up sending off missiles into space again.

BARTIROMO: Oh, OK, so we will be watching that. Gordon good to see you.

CHANG: Thanks, Maria.

BARTIROMO: Thanks so much for joining us. Gordon Chang is the Author of Nuclear Showdown, North Korea Take Takes on the World. Coming up, a handful of GOP Senators enough to scrap their version of the tax bill still withholding their yes vote. What will it take to turn them around? We're headed back to Capitol Hill next as we look ahead on "Sunday Morning Futures" today. Back in a moment.

(COMMERCIAL BREAK)

BARTIROMO: Welcome back. OK, Washington is returning to work this upcoming week following their Thanksgiving break. A handful of conservative and moderate Republican Senators remain however who are still not committed to their version of the tax bill. So can this pass and reach the President's desk before Christmas? Joining us right now is Lee Zeldin. He's another New York Republican Congressman who has a no vote on the House bill and it's good to see you, Congressman. Thanks so much for joining us.

REP. LEE ZELDIN, R-N.Y.: Thank you, great to be with you.

BARTIROMO: What do you want to see out of the Senate bill or what do you want to see when -- in the next couple of weeks get down and dirty in conference to really come up with one piece of legislation to put in the president's desk for signage? How do you want it to look different?

ZELDIN: Well for one, there are a lot of really good changes on the corporate side that you'll see on both the House bill and the Senate bill. On the personal side, there are some aspects that are a little better than the House bill, others that are a little bit worse. I mean, the Senate brings back the medical expense deduction, that's good. They have the mortgage interest deduction cap at a million dollars and the House version is at 500,000. The Senate proposes to fully eliminate the state and local tax deduction where the House version made progress in having a $10,000 property tax deduction cap, not enough progress for me but I'd love to see us go even further than the House version. They are also talking about some of the changes that need to be made on the pass-through rules.

Senator Johnson, he's been outspoken in the need to make sure we're delivering more relief for small businesses. I think that we should be treating people who would be in the personal service space more like the person who maybe say a widget maker and where you have a 39.6 percent bracket. And you're a New Yorker and your in the personal service occupation, then when you look at losing maybe your largest itemization of the state and local tax deduction, if you had a mortgage interest deduction cap of 500, you don't have any more medical expense deduction but -- and then on top of that the pass-through rules aren't applying to you because you are in personal service.

Then you're going to see a big tax increase and then there's also the big impact important for middle-income Americans as well. When you start talking about you know, a district like mine and you had Congressman King as well, of course, the half of my district itemizes and uses a state and local tax deduction.

BARTIROMO: Yes -- no, I think you make all good points. Let me -- let me talk a little about the business cuts, 20 percent corporate 25 percent pass through. Senator Ron Johnson said this doesn't make any sense and I'm wondering why they're both not the same rate. I mean, when you look at the pass-through companies, this is not just your hardware store on the corner. I mean, Cargill employs 150,000 people. That's considered a pass-through, so why do some companies get a 25 percent rate and others get a 20 percent rate? I don't understand that.

ZELDIN: Yes, and others would be paying a higher rate than that. So I think that it would be great to be able to level the playing field more, where we have an important shared goal across both chambers and the President trying to bring the corporate tax rate as low as possible and where I was supportive of the President going down to the 15 in the original proposal now to 20. I do know from conversations with people who are advocating for reducing the corporate tax rate, they'd be thrilled if at the end of the day it was at 22. So I think that we need to look at leveling the playing field as much as possible and that is one thing that I've heard as well as you know, the comparing the 20 to 25 percent rate and even the pass-through rules at the 25 percent rate depending on the occupations.

BARTIROMO: So what is the process at this point? They come back next week in the Senate, they will mark up their bill, then the House and Senate has to get together to come up with the best parts of both plans to make one plan, correct? Walk us through the next couple of weeks.

ZELDIN: Correct. So if the Senate were to say pass a tax bill as early as this week, right away you'd have conferees appointed. A conference committee between the House and Senate would start meeting to try as quickly as possible to come up with a version of the bill that not only is agreed to at the conference committee but can be passed by both House and Senate with the goal of having a bill on the President's desk by Christmas. It's an ambitious timeline but it is doable if the Senate passes a bill this upcoming week. A conference committee starts meeting right away and they make a ton of progress quickly. You can get there.

BARTIROMO: Yes. If you were the last holdout, and they needed your vote in order to pass any piece of legislation, are you going to vote no?

ZELDIN: Well I want to know what the bill --

BARTIROMO: You know -- you know, you're all going to get out of a job if you don't get this done.

ZELDIN: Yes, and I want to know what kind of changes are going to get made. The bill in its current form I oppose. If there are no changes that are made to it, I continue to oppose the bill. I would love to be able to improve the bill, I would love to be able to vote yes on a bill that gets us as close to perfect as possible. But for me, as I crunch the numbers for my constituents, I'm not voting to raise taxes on this many of my own constituents. I just won't do it.

BARTIROMO: I understand. Congressman, it's good to see you, sir. Thanks so much.

ZELDIN: Thank you.

BARTIROMO: We will see you soon. Thanks for joining us. So will the President's agenda take another step forward this week? We'll discuss it with our panel there on deck right after this short break. We're looking ahead right now on "Sunday Morning Futures." Stay with us.

(COMMERCIAL BREAK)

BARTIROMO: Welcome back. Well this holiday shopping season also comes as Donald Trump is marking his first year as President, how is the Trump economy shaping up right now and what should we expect? I want to bring in our panel, Democratic Strategist Jessica Tarlov is with us along with Wall Street Journal's Editorial Page Assistant Editor James Freeman, both are Fox News Contributors. Good to see you both.

JAMES FREEMAN, FOX NEWS CHANNEL CONTRIBUTOR: Good to be here.

JESSICA TARLOV, FOX NEWS CHANNEL CONTRIBUTOR: Thank you for having us.

BARTIROMO: Thank you so much for joining us. So I've got a report here from Goldman Sachs expecting four 2018 fed rate hikes because growth is getting better. They're looking at the U.S. jobless rate down to 3.5 percent in late 2019. Things have gotten better James.

FREEMAN: Yes for sure. We're now -- it looks like according to the Atlanta Fed forecast, we're into our third quarter in a row of three plus percent growth. That's new. We didn't really see that in the Obama years. So it's still I think too early to claim that Trump-onomics is working but it's -- all the signs are good.

BARTIROMO: And of course, one big sign is going to be the tax plan, Jessica.

TARLOV: Right.

BARTIROMO: They got to get this across the finish line.

TARLOV: They definitely do. And at this moment, you kind of -- when you look at someone like a John McCain who I think has revealed in his role as kind of decision maker right on the health care bill where it was the last minute and that sly smile as he dropped his vote. You don't really know what's going to happen here. And he hasn't been that vocal about where he's going to fall on this except to say I want regular order right and I want to go through the process.

There's some outstanding Senators that need to be wooed, as it were Ron Johnson, Susan Collins, even though Lisa Murkowski who was with her on the health care bill has said she's OK with the individual mandate repeal now which is very odd as it hits Alaskans very hard to do that. Susan Collins is going to need some work and there are the deficit hawks types. And I've heard as well that Jeff Flake, it's not just about the deficit, he wants to have it changed formally that the middle-class tax hikes will go away in 2027 to have that formalized. So a lot of concerns but no doubt it's looking good for Trump at least for him to say it's working.

BARTIROMO: Do you worry that these personal fights back and forth with John McCain, back and forth with Bob Corker are going to actually impact the agenda, James? Is that going to get in the way?

FREEMAN: It's a risk.

BARTIROMO: Talking about healthcare right?

FREEMAN: Yes, I think it's a totally different at least a different vibe and I think more than that where you looked at the healthcare vote and they had real differences. I think the Republican caucus in the Senate is very unified on the idea that they do want this tax cut. Yes, they are discussing details of it but I think they want to get this when they know they kind of have to for next year's elections. So I think that it gets done and I think Bob Corker has made a commitment with his colleagues regardless of what the President is tweeting to cut a trillion and a half dollars in taxes, so I think that happens. And John McCain, I don't see what the big objection is but he's always a wildcard so you never know.

BARTIROMO: We're looking at 2020. Donna Brazile making some comments this past week Jessica, about 2020. She thinks there are more than 50 people who will run against Donald Trump. What do you think it looks like?

TARLOV: 50 seems high but I hope that we have at least 10 good ones. Democrats really need to get it together. The generic ballot right now has us up 13-15 points going into 2018. If we can continue that, if Donald Trump doesn't get a big win as we said in tax reform, looks like it should be the one certainly for the businessman President, then Democrats are going to be looking really good in 2020. But we don't have a Barack Obama yet. We haven't had our 2004 DNC convention moment where we have our star.

And so 50 is high but I would like a solid 10 and it will be interesting to see the dynamics and we've talked about this a lot as you know, Republicans clearly have their issues, we have our own with the Progressive left coming after this interest left as it were. Dianne Feinstein is a great example about what's happening to her in California with challengers from the far left of the Bernie Sanders camp. So while a few months ago we would have said we'll see Corey Booker, we'll see Kamala Harris, we now have the far left eating them alive saying that--

BARTIROMO: Elizabeth Warren.

TARLOV: Elizabeth Warren, you know, really an attack dog mode and they've used Donna Brazile's book as a vehicle for that. You know, it was rigged, Bernie would have won, blah, blah, blah.

BARTIROMO: Right. Exactly.

TARLOV: So things are not easy on our side.

BARTIROMO: It was rigged. I think it was rigged on the Democratic --

TARLOV: Certainly I think that the scales were tipped. I don't think you can rig four million votes but I understand the argument and I understand why people felt disenfranchised by the process, so we have to do better.

BARTIROMO: James?

FREEMAN: Yes, I think the President -- he needs the tax cut to deliver the robust economy he's promising. That's one issue voters tend to give him very poor marks on everything except that. And fortunately for him, that tends to be what people vote on, the economy. But he's got to deliver there. I think where he's vulnerable is if the Democrats choose to nominate a moderate, you know, John Hickenlooper from Colorado, somebody who kind of you could sell to middle America.

TARLOV: Sherrod Brown is my favorite.

FREEMAN: I don't think there's much -- I don't think there's much risk that they're doing that because you're seeing this kind of slow-motion takeover of the party by Bernie Sanders. You see a lot of Senators who are thinking about 2020 backing his single-payer healthcare plan. I think the full-on kind of -- kind of marks as a rant that Sanders represents, if that becomes a Democratic Party message, I could see Trump winning again and maybe winning big.

TARLOV: Can I just add something to your point and while I said I think the tax reform bill is critical to the success for the Republicans. You know, we now have a non-partisan study out that says 50 percent of people are going to have their taxes raised. Democrats are exceptionally good --

BARTIROMO: I don't know if it's 50 percent, that's a high number. That's crazy.

TARLOV: I think it was the tax policy center that said that but maybe that's when the -- when the tax --when the -- maybe it's because it won the middle-class tax height last in 2027 but either way there are -- there's great messaging coming out of the left about how this is, tax cut for millionaires and billionaires.

BARTIROMO: Well we knew that was coming but that's another talking point.

TARLOV: But the American public doesn't favor this plan. So I wonder even if it does happen if they will still just want a time for a change, right? And that's what happens to the natural flow of things anyway that we could have a wave election.

FREEMAN: Well, I think what you're going to get is these dueling studies are maybe important in the discussion right now. The bottom line is going to be does the economy grow and create jobs or not. And I think if he gets that big corporate rate cut even if a lot of folks in the media, a lot of Washington analysts don't like it, he's going to get that growth and he's going to be very tough to beat unless Democrats go kind of against where they've been going and nominate a moderate.

BARTIROMO: Change their message -- change their messaging. We'll take a break. More with this great panel when we come right back. We're looking ahead this morning on SUNDAY MORNING FUTURES. Back in a moment

(COMMERCIAL BREAK)

BARTIROMO: And we are back with our panel Jessica Tarlov and James Freeman. You know, you mentioned the three percent quarters that we've seen. I think it's partly because of regulations. This President has been the least regulatory President. And in Congress, they laugh about the number of pages that President Obama increased in terms of regulation, they say it's equivalent to 15 King James Bibles, James?

FREEMAN: Yes, so we've gone from the most regulatory President ever in terms of number of pages of rules and proposed regulations and final regulations spewed out in the federal register to essentially the least. I mean, you know, it's probably -- you don't want to quite say this is Ronald Reagan because that's the gold standard but in terms of year one slowing down the federal machinery of putting out red tape, this is a remarkable performance so far and it has a lot to do. I think growth picking up investment, corporate investment picking up.

BARTIROMO: They're loosening the purse strings but they need every vote. I mean, this is through executive order by the way. All these regulations, they need every vote in order to get a win on the board. And now we're facing this Senate race in Alabama and Roy Moore, Jessica, so we don't know where that vote is.

TARLOV: No, we don't. I mean, the polling right now looks good for Doug Jones and he was up about eight in the latest -- the latest Fox poll and another poll as well, but you don't know what happens and Hillary Clinton was up in a lot of polls in certain states and that didn't work out. The big shift has been apparently with Republican women. I think it's up to 20 percent and Alabama are now saying that they're not going to support Roy Moore anyway -- anymore. Kellyanne Conway was on T.V. saying, you know, we need this vote because of the tax reform proposal. President Trump seemed to say the same thing when he talked about it last week as well. That puts him I believe in a very precarious position. I thought this would have been an easy one. Accusations of child molestation go so far beyond sexual harassment.

BARTIROMO: But the word is accusations?

TARLOV: No, I agree but I mean, they are accusations across-the-board here with all of these men who have been accused and some of them admitted obviously to certain things and not to others starting with Charlie Rose said yes to some, no to others. But the point is the President taking a stand on this and he has to say something. I think it's so disheartening I guess to hear -- you know, we just need this vote and I do understand that, but you are talking about lives and the lives of a child where this happened and you know, he deserves his day in court. We know the Alabama voters will decide.

BARTIROMO: Right. And I was surprised to see Ivanka Trump weigh in.

TARLOV: Right. and then the President not follow her.

BARTIROMO: That's right.

FREEMAN: Yes, I mean, they're unproven. He's denied them but they do seem credible and they're quite disturbing.

TARLOV: Mick Mulvaney said that it was credible. That's what's really odd here.

FREEMAN: Yes, I think he probably loses. It is another argument to try and get that tax cut bill done before December 12 when this happens. They seem to think they're going to need his vote which I guess maybe make us a little more concerned about the tax plan but I think they get it done. I think he probably loses, but I can understand if there are voters who are saying you're dumping another big story like this on us right before we have to decide and we have an allegation and it's being denied and puts them in a tough spot.

TARLOV: But it could have gone now, and what I thought he would have done since he did back Luther Strange when that seemed strange, he could have said, you know, I told you from the first place which he love for ego, right? I said Luther Strange was the right guy and you know, write him in and then GOP could have a write-in candidate campaign.

FREEMAN: Yes, on the other hand, maybe he's decided Moore is going to win.

BARTIROMO: That's true too. James Freeman, Jessica Tarlov great to see you.

TARLOV: Yes. Thank you. You too.

BARTIROMO: Thank you so much on this long holiday weekend. That will do it for us on "Sunday Morning Futures." Thanks so much for joining us. Have a great rest of the weekend. I'm Maria Bartiromo and I'll see you bright and early tomorrow morning on Fox Business Network. "Mornings With Maria" is 6:00 to 9:00 a.m. Eastern. Stay with Fox News right now, here's "MediaBuzz" with Howie Kurtz after this break.

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