U.S. Senate hopefuls Tim Kaine (D) and George Allen (R) discussed taxes, growing and keeping talent, government contracting and cybersecurity at a technology town hall sponsored by the Northern Virginia Technology Council at Microsoft's Reston offices on Thursday.

The forum was the first joint appearance by the candidates since Allen won the Republican primary earlier this month.

Kaine outlined his impact as governor of Virginia (2006-10), attracting new businesses to the state during the deepest recession in 70 years. He is running on a platform of keeping and attracting talent (by investing in education, offering more opportunities for veterans), investing in infrastructure (Rail to Dulles shows "we can build things again") and being good financial stewards (narrowing the federal deficit by cutting defense spending and eliminating Bush tax cuts).

Allen, a former governor (1994-1998) and U.S. Senator (2001-06), highlighted the role technology plays in Virginia's — particularly Northern Virginia's — economy. Allen talked about the principles of his platform in 2012 - to rein in regulators, make tax laws simpler, release alternative energy and setting education priorities.

The candidates did not share the stage, but were asked the same questions from a panel of NVTC leaders and then took a few questions from the audience.

Among the highlights:

*Sequestration — Defense contractors could face a significant drop-off in their government businesses if the federal government's automatic spending cuts resulting from last year's debt-ceiling agreement take effect in January.

Kaine: "I believe the Gang of Six should work very hard to put out a plan. I don't think there will be a committee vote before Election Day, but the plan should have a mix of of tax reform and expense cuts."

Allen: "The latest deal from last year — I did not support it. I saw it as Washington punting, abdicating responsibility. It has failed. What needs to be done is to set priorities. The only reform that is going to work is a balanced budget requirement. It is not so hard to understand - don't spend more than you are taking in to get the economy moving. Lets have some certainty in our tax policy  so businesses can invest and create jobs."

*Taxes — Where do you stand on federal legislation requiring Internet businesses having to collect and remit sales tax in every state in which they do business?

Kaine: "I do think longterm we have got to find some strategies that would produce more equity between bricks-and-mortar and online."

Allen: "If a business does not have a presence in state cannot be commanded to remit sales tax.  It would be burdensome to small businesses to comply. They will be subject to audits from other states."

*What is your approach to closing the $1.3 trillion deficit?

Kaine: "Let Bush tax cuts over $500,000 expire; I would propose cuts for lower- and middle-income people. That's what I would try to do by year end. I think we subsidize large oil companies; they don't need our help to be productive. We need to get into longterm tax reform. It has not been done since 1986. We have to go back and simplify agan — lower rates, broader base, fill in exclusion and exemptions.

On the expense side, the only way to make the kinds of cuts we need is to go after every line item — the biggest two are defense and entitlements. We still have a Cold War base structure. We need to leverage technology to bring down manpower needs. For Medicare, we should eliminate the no-negotiation rule with pharmaceutical companies. That would save $25 million a year."

Allen: "I have been a long supporter of repatriation of taxes. I would like to see tax system overall be much simpler, flatter and lower. The proposed tax on job-creating businesses is 20 percent. Right now it is at 35 percent. [Lowering it] would help create $500,000 new jobs a year. It would really send a message that America is open for business. For individuals, there should be freedom to choose a flat tax. "

*Insourcing — Should the government use private contractors to get things done or stick with federal employees?

Kaine: "I am an agnostic about whether work is done public or private sector. I want it done in best possible way to serve citizens in the most cost-effective way. I think if you are a senator from Virginia or Maryland, part of your job description is you have to care a lot about contracting and a whole lot about federal employees. I would try to make sure there is a fair comparison and decision making process."

Allen: "There should be required analysis — if insourcing is done, they need to look at what it is going to do to a company. I actually think there should be a moratorium on insourcing. The analysis on cost to taxpayers is not an accurate one. I think it is much better to be using agile, up-to-date systems and software in a private business, and after that business is conducted then the government does not have to pay for retirement and federal benefits."

*STEM careers and the talent gap. Some 3 million tech jobs are unfilled nationally because workers don't have the right skills. What can you do to ensure those jobs are not going overseas where people have the right training?

Kaine: "One of the things I would like to work on is to accelerate the renaissance in career and technical education in this country. I want to serve on the Senate Education Committee. I want to reform No Child Left Behind and change the focus to excellence measures and not just results."

Allen: "We in America ought to be encouraging more people to be studying STEM, and also trade areas — there is a tremendous need for welders, tool operators. I think we ought to encourage young people to take those courses. If we do have to bring folks in from other countries, what about students who come here to study? Why not attach a green cards to diploma if have a job waiting for them? need to have people with skills developing for the future."

*Cybersecurity — Cyber threats are a growing risk. What solution do you advocate for keeping security without hampering innovation?

Kaine: "Regulations have a purpose — they level playing fields and provide balance. We will have to test them and see if they are choking off innovation."

Allen: "I deplore these leaks. Obviously, there needs to be sharing of info on cyber attacks. I do not want to get it over regulated; our critical infrastructure is vital to our country."