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WALLACE: Carl Cameron reporting from Des Moines. Carl, thanks.
Now, let's bring in Ohio Governor John Kasich who wasn't in Ohio on Iowa this weekend, but has been on a cross-country tour, increasing chatter he may run for president in 2016. Governor Kasich, welcome back to "Fox News Sunday."
JOHN KASICH: Always good to be with you, Chris.
WALLACE: In his -- in his -- excuse me, in his State of the Union address, President Obama talked about middle class economics, raising taxes on the wealthy to help secure working families. What's wrong with that?
KASICH: Well, raising capital gains taxes, Chris, is just a prescription for economic slow-down. You know, I was budget chairman in '97, the last time we balanced a budget and the first time since man walked on the Moon, we cut capital gains taxes and we ended up with a surplus of $5 trillion surplus that was quickly spent unfortunately by Republicans. But the fact is that you cannot build a little guy up by tearing a big guy down. Abraham Lincoln said it then and he is right.
In our state, what we tried to do is we've tried to reduce -- we haven't tried, we have, we have had the largest tax cut in America over the last four years. We lower the top rate, but we also provide tax relief for those at the bottom to encourage more work. But the idea that raising capital gains tax is going to somehow help your economy it is just -- isn't going to work.
WALLACE: But let me point out and some conservatives have hit you on this what you said in your second inaugural address this -- couple of weeks ago. Here it is.
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KASICH: Economic growth isn't an end into itself. Economic growth provides the means whereby we can reach out and help those who live in the shadows.
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WALLACE: Governor, you accepted federal money -- under Obamacare. You accepted federal money under Obamacare to expand Medicaid. You are calling for new taxes on cigarettes and natural gas drilling. You quote Matthew 25 about fitting the hungry. Some people say you're too close to Barack Obama.
KASICH: Well, Chris, listen, we're running a billion and a half surplus in the state. We're structurally balanced when 20 other states are not able to do that. We are up almost 300,000 jobs and, you know, we are structurally balanced. I mean I've always been fiscally responsible. But let me just speak to that issue of helping other people when economic growth provides you an opportunity. I will not turn my back on the mentally ill, who live under bridges too often of the time in this country. I will not turn my back on the drug addicted and I won't turn my back on the working poor. I'm a believer that as a conservative that everybody has a God-given purpose and it is our job on a temporary basis to try to give them a chance to fulfill their God-given purpose by helping them.
Now, it can't be a way of life. It can only be a situation where you help them for a short period of time. And we demand and are going to demand in our new budget, personal responsibility that they begin to get training. That we include the business community and we get people from welfare to work and to more progress. But at the same time, tax reform isn't order of the day. What we need to do is to make sure we are able to provide strength for those that want to invest and risk take and that's exactly what our tax plan is going to be. It's going to help small businesses. We have made significant progress in helping small business. But the proof is in the pudding. We're balanced. We're running surpluses. We have the lowest unemployment in 14 years.
Chris, it's all working. And in Ohio, everybody feels included and finally in our state of Ohio, which is a microcosm of the country, I won 86 out of 88 counties and 64 percent of the vote and I won a county that Barack Obama won by 40 points. The fact is what Americans want is they want everybody to share an opportunity, everybody to be helpful, and that's what we do in our state. And it's something that the country can learn from.
WALLACE: All right. I want to talk about something else you think the country could learn from because you are touring the country right now, pushing for a constitutional convention to pass an amendment to the Constitution for a balanced federal budget. Why?
KASICH: Chris, we're 18 trillion in the hole. And I went to the Republican Convention and that's all they talked about. Now, I hope they'll do something about it now that they have a majority. The fact is, when I left Washington after being one of the architects for a balanced budget, they blew a $5 trillion surplus. This is about protecting our kids, the next generation and providing economic growth today. And just think about a convention, if we would go to a convention instead of kids focusing on Justin Bieber and Tom Brady and deflated footballs, maybe they would start thinking about Ben Franklin and Jefferson and Madison and Monroe and we can renew our country. It can be exciting to force the Congress to be responsible. That's why I'm out there doing this.
WALLACE: Forgive me for interrupting. But we've got limited time. Here is the knock ...
KASICH: Yes.
WALLACE: Here is the knock on a balanced budget amendment that there are times when the economy is weak when you need some deficit spending to prop up people, for instance, when a lot of people were out of work and you need to pay more unemployment benefits. And also, for instance, Social Security would only be able to spend the amount of money that it takes in that year and so a lot of critics say you would end up cutting benefits. Your response?
KASICH: Chris, we are 18 trillion and we keep fiddling, we're going to be 30 trillion. We are fiddling around while Rome burns. Now, of course, any kind of an amendment can have appropriate exceptions, economic calamity, war, but the fact is most of the time when you keep doing things that we don't do in the states and families don't do, which is spending without regard, we are mortgaging our children's future. This is not a new thing for me. I have been pushing this since I was 27 years old and I'm going to keep pushing it.
Presidents come and presidents go, but changing the culture in Washington and locking in a balanced budget amendment will provide for economic growth today and a hope for our children tomorrow, Chris.
KASICH: Governor, let's talk about a couple of issues involving you that are red meat for conservatives. You say opposition to common core educational standards is, quote, your word, "hysteria." We had Bobby Jindal, the governor of Louisiana on here, a couple of weeks ago, and he said, common core is a stalking horse for federal takeover of education.
KASICH: Well, I mean these were governors that helped create common core. Chris, the common core was written by state education superintendents and local principals. In my state of Ohio, we want higher standards for our children and those standards are set and the curriculum is set by local school board. Barak Obama doesn't set it. The state of Ohio doesn't set it. It is local school boards driving better education, higher standards, created by local school boards. I've asked the Republican governors that have complained about this to tell me where I'm wrong. And guess what, silence.
But you know, part of the problem is today politicians are running to try to get votes. You know what we try to do out here, we run out here trying to solve problems. And we have a problem with the education standards and our children's ability to compete in the world. We're not going to turn this over to Washington or even to Columbus, our state capital. It's local schools with local school boards and high standards. I don't know how anybody can disagree with that unless you're running for something.
WALLACE: Well, let's talk about running for something, Governor, because I'm sure, lot of people are hearing you and thinking why the heck doesn't that guy run for president? You have said and you've been very cautious about this, you're open to it, you're not closing any options off. How are you going to decide what are the factors that you're going to take into consideration and when are you going to make up your mind?
KASICH: Well, initially I'm introducing a budget in another week that will be another significant reform budget. That's what we do out here. And remember what it was like when I came in, 8 billion in the hole, the loss of 350,000 jobs, now we're structurally balanced, we have surpluses, we cut taxes to $3 billion and we are including everybody, including our minorities that need to be paid attention to. So, what I'm going to do is focus now. I got to get this budget going, Chris. I have not taken any options on the table. There's plenty of time for me to decide. And you know what? Ohio is a microcosm of America. And when you're doing things in a state like this where things are getting better, people are more hopeful, that's an important message to take around the country, whether I run or not. And the balanced budget amendment gives me a chance to tell people about what this country needs to do to grow and to stop fighting every single day. All I hear is fighting. You know what, people don't want fighting all the time. They want people to agree and move our country forward.
WALLACE: Well, you could do that if you ran for president.
KASICH: Well, you know, I said, options are still on the table. We'll see. But you know, let me tell you, Chris, I love my buckeye state. I love what we're doing out here. And in some respects what we're doing here -- if you listen to some of the rhetoric of the people running for president now, it's interesting how many of them are using these comments about caring for people. You know how many Republican governors are trying to figure out how to expand Medicaid? I took all the hit, which -- it doesn't bother me in the least. But now we have a bunch of Republican governor say, let me see if I can get into that program. I just want to be a good leader. I want people to feel like they have got a chance no matter who they are and I tell you one interesting thing, Chris, I was in Utah and I was walking through the Capitol and I saw a bunch of inmates. I don't know what they were doing there. Maybe cleaning things up. And I walked up, Id shook every one of their hands. And you know what I told them, God has a purpose for you. You're in a tough spot right now. You may be in a tough spot later, but remember, the Lord has a purpose for you. Be hopeful. I want people to feel like they've got a chance and their kids have a chance.
WALLACE: Governor, thank you. Thanks for talking with us. I hate to say this as a big wolverine fan, but congratulations on your national football championship.
KASICH: You know, that's a shame Michigan ...
WALLACE: Yes, sir.
KASICH: It's a shame Michigan gave up playing football.
(LAUGHTER)
KASICH: Maybe they'll take it up again someday.
WALLACE: Well, I guess you're not planning (ph) on getting any electoral votes there. Thank you very much, governor.
(LAUGHTER)
WALLACE: Always good to talk to you.
KASICH: Come on out and see us, Chris. God bless you.
WALLACE: You bet.
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