Bob Schaffer in 2008 CO Senate Debates

On Education: More competition needed in higher-ed loan-making

He warned the collapse of mortgage lenders Fannie Mae and Freddie Mac could also happen to the federal loan system. “This is really a question of whether you support a higher-ed lending system that is doomed to collapse like Fannie and Freddie have or is it sustainable,” he said.

On Immigration: Opposes sanctuary cities; help local police enforce law

Udall said the federal government “has been missing in action.” He suggested a number of reforms including tamper proof IDs, new technology for monitoring the border and a program that would allow for immigrants already in the country to “come out of the shadows,” register themselves, pay a fine, go through a background check to prove they can speak English and are employed, then “go to the back of the line” to gain citizenship.

On Budget & Economy: $700B bailout is dead hand of government making things worse

SCHAFFER: There’s nothing to like about the notion that there is a $700 billion fix needed with respect to a collapse on Wall Street. That’s about $10,000 to $11,000 per American household. It’s essentially a tax. So you’re correct. For the Congress to suggest that there’s something to celebrate is exactly wrong.

Q: Chris Cox, the chairman of the SEC, said it’s not the dead hand of government, but the blind eye of government. He now apologizes for deregulating. So isn’t it time to reinstitute closer regulation of Wall Street?

SCHAFFER: In some areas, perhaps, with respect to transparency, & with respect to certain areas of accountability. But not in a way that slows or constrains the ability of the economy to grow.

On Budget & Economy: Congress’ 2007 laws made private sector pay for bailout

UDALL: What we can’t do, is return to the policies that Schaffer supported & supports today, which are tax breaks for CEOs & companies that offshore jobs.

SCHAFFER: That’s not true.

UDALL: That’s not going to get us to health in our financial system. Schaffer supported a lessening of regulation.

SCHAFFER: That’s not true either. You voted against several amendments. You voted against establishing minimum capital levels for Fannie Mae and Freddie Mac. You voted in 2007 to further loosen Fannie Mae and Freddie Mac’s credit limits. That leads directly to the crisis we’re seeing on Wall Street today.

UDALL: This is [the result of deregulation during] 10 years of the Bush administration, of the Reagan revolution coming to its logical conclusion.

SCHAFFER: Those of us who’ve been back home in the private sector working hard for the last 6 years are sick & tired of these kinds of votes that make all of the rest of us pay.

On Budget & Economy: $700 billion bailout is necessary but essentially a tax

Udall accused Schaffer of supporting the policies that have led to the economic crisis, while Schaffer responded that Udall has voted against having more oversight for companies like Fannie Mae and Freddie Mac.

Schaffer said the proposed $700 billion bailout is necessary but “essentially a tax.” Udall says the plan is not supported by his constituents.

On Energy & Oil: Federal government rakes in funds from high energy prices

SCHAFFER: I cast votes in favor of an energy policy. The dramatic increase in revenue for the federal government right now is partially a function of the dramatic increase in energy prices. The energy industry’s marginal profit rate is about 8% right now, so as the price climbs, that 8% then creates an extraordinary amount of profit. That profit is taxed, and the windfall to the federal government as result of high energy prices is what the government is raking in right now and not spending it particularly well.

Q: When you use the phrase “on the backs of the energy companies,” you sound like they’re poor, beleaguered companies that the government is taking advantage of.

SCHAFFER: Oh, absolutely not. But the federal government is raking in funds as a result of this energy crisis. That’s one of the possible motivations why people in Washington, like Mark, have fought to drive energy prices up

On Tax Reform: Cutting taxes increased revenue & unleashed economic growth

SCHAFFER: You’re correct that under Republican leadership, deficits grew, and I think it has mainly been a function of war. However, I was in Congress for six years. I got elected 1996; I left in 2002. During those years, we did balance the budget. We did it by trimming the rate of growth in spending, but more than anything else, the tax cuts that we helped pushed forward, which applied to middle class households. Mark Udall likes to talk about it as tax cuts for the rich--but we actually grew the economy faster than had been projected--we actually increased the amount of revenue coming to the federal government while we were slowing down the rate of growth in spending and reforming on the regulatory side. Welfare reform, for example, & other reforms, helped unleash the productivity of the economy. We need to do that again.

On War & Peace: Surge is working; but it might take years

SCHAFFER: Hard to say. If they are, I hope that it’s not involved in tactical involvement on a day-to-day basis, but strategic. But I’d hoped that we’d have American troops out even sooner. That definition you read, was before there was a clear indication that the surge has worked. I am optimistic, however, that we are achieving those objectives right now.

Q: [to Udall]: A year ago you said that the surge was a tragic mistake. Were you wrong?

UDALL: It’s time to leave Iraq. It’s time to leave Iraq responsibly.

Q: Were you wrong on the surge?

UDALL: The surge has helped. There are other factors in Iraq that have been helpful.

On Free Trade: Reducing repatriation tax pumps capital into economy

“When you give these companies a [tax] holiday, that rewards these companies for creating these jobs overseas & not here,” Udall said.

Schaffer, however, said a temporary reduction in the repatriation tax would, in fact, strengthen the US economy. “What would be a more powerful boost to the economy is exploring multiple strategies to pump private capital, real dollars, into the economy,“ Schaffer said. He said Congress did this as recently as 2004, dropping the repatriation tax from 35% to 5.25%, bringing $362 billion into US banks.

Schaffer said Udall’s criticism of the plan to lower the repatriation tax is curious: ”He voted for it at its last step before it went to the president,“ Schaffer said. According to congressional records, Udall voted for the 2004 American Jobs Creation Act on Oct. 4, 2004, after he voted against it in June.