Larry Kudlow

Kudlow: I was talking about Jack Kemp my mentor, the late Jack Kemp, the great Jack Kemp, my friend and mentor, and his great message of economic growth and opportunity for all.  I want to emphasize those last two words- for all.  Nobody, in my lifetime, in either party, has reached out with a message of hope, growth and opportunity to minorities better than Jack Kemp. And I want to bring in my pal, Jimmy Kemp, who runs the Jack Kemp Foundation because, Jimmy is now the keeper of the scrolls and he is also a great friend.  Jim, how are you buddy?

Kemp: I’m great Larry, how are you?

Kudlow: I’m okay uh you know, there’s some scattered, you see some scattered columns and websites that talk about where’s the Jack Kemp, the new Jack Kemp in the Republican Party but, it was Jack’s message- I gave a talk, it was very funny, I gave a talk to the Wall people, the Manhattan, New York Republican Party and I’ve done this a little bit on the Kudlow Report, we had a whole Jack Kemp segment two nights ago-

Kemp: I saw it.

Kudlow: Alright, what I remember, let’s put the tax cuts aside for a minute, as important as they are, what I remember, particularly when Jack was the Secretary of HUD, because I was one of his volunteer kitchen cabinet there; Jack wanted Empowerment Zones-

Kemp: Enterprise Zones.

Kudlow: Enterprise Zones, tax free Enterprise Zones-

Kemp: Not tax credits, but tax free, you’re right.

Kudlow: and as much home ownership as possible for minority groups.  Jack went to the projects, he actually went to the projects in Detroit, Chicago, L.A., and New York.  He worked with Charlie Rangel, the great, black Congressman in New York City and we developed what became Empowerment Zones here in New York City.  My wife’s art studio is in one, I mean am I wrong here?  Is my memory betraying me?

Kemp: No, no of course not and part of what Dad understood is that- good policy, as great as Kemp-Roth was at cutting tax rates at that time, which was, reflecting on it, it was obvious tax rates were confiscatory. You couldn’t have them that high and have a growing economy. But he also knew at the same time, back in the 70’s, way before he was at H.U.D., but in order to have good policy it can only be policy that can be passed and in order to pass it he had to get Democrats. Larry, he was a Republican in a Democrat controlled House of Representatives and yet they had President Reagan in 1980, but he had to convince people, like Charlie Rangel, that he really did care. And that these policies that were “conservative,” he liked to call them liberal, because they were intended to free people to provide equal opportunity and knew that tax rates went along with providing that equality of opportunity in the housing sector, for people starting businesses in ghettos or barrios or poor urban areas, wherever they were. He knew that capitalism without capital is nothing but an ism, as Jesse Jackson had said and you had to get capital to people who would do something with it. He trusted people, and, as you pointed out, all people, not just rich folks who went to good schools.

Kudlow: See that’s the thing. Now the Republican Party is, some people in the Republican Party are trying to open up immigration reform. I’m all for it. Your dad believed that immigrants were a positive force.

Kemp: E pluribus unum.

Kudlow: Right. He would have been on the right side of that issue today. But, you know, Jimmy, It’s just like reaching out and saying okay we’re going to give you a green card, that’s not really the answer. I mean what I’m saying is Jack Kemp had a set of policies, besides low tax rates, he had ownership policies, he had empowerment policies, he had, let’s see, no capital gains tax if you moved a business into an Empowerment  Zone, which would attract capital and people. There was human capital and financial capital. Kemp visited the projects, I want to emphasize it, Kemp met with La Raza Hispanics. Kemp visited the projects. When we were negotiating back in , I don’t know when this was Jimmy, 1991, Jack sent me to a couple of meetings with La Raza with his Rep. to try to figure out how to get a zero capital gains tax and La Raza backed it. They actually backed it. Now, Republicans don’t do that anymore. They don’t show up in the projects, they don’t go to a La Raza meeting, they don’t get photographed with Hispanic leaders and black leaders anymore. That was stuff Kemp did, it was great stuff. Why doesn’t anybody do that now, follow his example

Kemp: Well, the greatest example and a guy we all love and respect, Paul Ryan, who worked for Dad. H made the calculated decision to focus on our incredible budget deficit and the spending that was out of control in the entitlement programs and led, Larry as you know, it took him away from the main thrust of Dad’s career. And there isn’t anybody who has jumped into that, really opportunity, the way that Dad took the reins, and there are a lot of great leaders today. I’m not discouraged. Part of our purpose at the Kemp Foundation is to help support or political leaders and we’re certainly not pessimistic because we certainly couldn’t have the name Kemp associated with us if we were. You’ve got governors who are doing the right thing, you’ve got plenty of congressmen and senators, but we do need a more robust discussion of the components of an economic policy because there should never be any discussion of a new normal, I know you hate that phrase. This country has too much capability and abilities, not only in the board rooms, but in classrooms around the country.

Kudlow: Growth should be unlimited. Just to reset the table, we’re talking to Jimmy
Kemp who is the president of the Jack Kemp Foundation. I am holding up, you see these stories about Jack Kemp, one story was written, “We need entrepreneurs like Jack Kemp.” Okay, I’m fine with that, but I don’t want to miss the essential point here, the essential point; Jack’s goal was growth, in other words, if you grew the economy rapidly through lower tax rates, less regulation and sound money, if you grew the economy that was a weapon to shrink the budget deficit and the debt. That was Jack’s way out. That didn’t mean he’d vote for spending bills that were unnecessary, but he understood that debt to GDP, that Republicans obsess about all the time, you solve that, in some sense, by growing the GDP.

Kemp: Sure, you want a bigger pie.

Kudlow: Bigger pie! And secondly, with the debate about so called Republican outreach to minorities look at what Kemp did. Kemp didn’t do it just to win votes, he had a program. Let’s go through it again, it was home ownership, it was enterprise zones, it was tax-free enterprise zones. He would go to the meetings and the rallies and meet with the leadership. He already showed the way. What we need is a Kemp biography here to let people read this stuff and that’s what he did, he was a one-man band. Some Republicans made fun of him, the country club crowd made fun of him, Jimmy, but we should follow his lead now.

Kemp: Well, yeah, the Kemp Foundation has a biography in the works and then we’re also releasing, in 2013, all of his speeches, which were previously released in a volume called the American Idea. And American Renaissance, we’re going to put out as well. The American Idea will have all of the speeches that were in it previously, but a bunch added to it.

Kudlow: Who’s doing the biography Jimmy? We only have 25 seconds. Who’s doing the Biography Jimmy?

Kemp: We’ve got Mort Kondracke and Fred Barnes working on it.

Kudlow: I did the oral history. I want to see that. I want to work on that biography.

Kemp: Alright.

Kudlow: Jimmy Kemp, president of the Jack Kemp Foundation. That was Jack Kemp’s message, hope and opportunity for everybody, including minorities. I’m Larry Kudlow and we’ll be back with some budget talk on the other side of the break.


Larry Kudlow

Lawrence Kudlow is host of CNBC’s “The Kudlow Report,” which airs nightly from 7 p.m. to 8 p.m.