Focus on Revenues — Drive Sustainable Economic Growth + Change Tax Policies Focus on Revenues Invest in Technology / Infrastructure / Education Drive Sustainable Economic Increase / Improve Employment SOLA Improve Competitiveness Consider Review Tax Rates Changing Tax Reduce Subsidies / Tax Expenditures*/ Policies Broaden Tax Base Note: *Tax subsidies / expenditures are losses to the U.S. Treasury from granting certain deductions, exemptions, or credits (such KP as those on mortgage interest payments and employer-sponsored health insurance payments) to specific categories of taxpayers. i USA Inc. | What Might a Turnaround Expert Consider? 355 GDP Growth = Biggest Driver of Federal Revenue Growth...& 85% Correlation 1940 — 2009 Historical Correlation Between USA Real GDP Y/Y 2010E — 2019E & Real Federal Receipts Y/Y = 85% If Real Real Federal 60% | © Real GDP Y/Y vs. Real Federal Receipts Y/Y 7 GDP Revenue ; ; 7 Y/Y is Could Grow... — -Linear Trendline (y=2.77x-0.0438, R42=0.73) £4 ' ee r 7 5% 7% = 7 2 7 2 e @ 7 g °e 7 e ee ee ae ac Y 7 0 -4 7 ———EE—EE— Z 20% 7 -1 -7 te e 4 J z e P ¥ 2 9 < e 7 . -3 -11 ® e @ x @e 4, -13 0 we 9 e;7 + be -5 -16 © ° ® -5% is e%& ee 5% 10% 15% 20% 25% o, € Current Consensus e 7 GDP Forecasts 7 Real GDP Y/Y (%) 7 e -20% Data source: White House Office of Management & Budget (1940 — 2009). (@)E) www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 356 HOUSE_OVERSIGHT_021019