Appearing with CNN host Fareed Zakaria, the chair of the White House Council of Economic Advisers condescendingly ripped critics of the GOP’s tax plan — but refused to stake his personal reputation on its success.
Kevin Hassett, who is one of President Donald Trump’s top economic advisers, fired back at former Treasury Secretary Lawrence Summers who has criticized the plan and called the defense of it: “dishonest.”
According to to Hassett, Summers and other critics are “extremely incorrect.”
“Accusing us of being dishonest is not becoming of a former treasury secretary,” Hassett said while smirking. “But let’s get past the attacks and go to the substance. What Larry Summers did, he’s on his fifth attack now and each one has been exposed as a horrendous blunder.”
“This idea that you can compare the change in revenue to the change in wages has been exposed as a really critical blunder, an economics 101 blunder, by John Cochrane at Hoover, by Larry Kotlikoff. People at these universities have exposed the fallacy of Summers’ very simple mistake and already a week later you’re still talking about it here,” the Trump aide lectured. “It’s been exposed as a mistake and you’re still asking about it. I don’t understand why.”
“Let’s talk about the effect on the deficit,” the CNN host parried. “After the Reagan tax cuts, the national debt tripled. If you look at what happened after the Bush tax cuts, massive ballooning of the deficit. Why isn’t it the case that this the same path and explode the deficit?”
“Let’s think about the things that we agree about, Fareed, for a minute,” Hassett said ducking the question. “You agree, right, that the U.S. has the highest statutory corporate tax rate in the developed world, correct? Because they [corporations] moved the profits overseas. There was a National Bureau of Economic Research study that estimated that more than half the U.S. trade deficit comes from overseas.”
“We have this high tax rate that they don’t pay, so why doesn’t lowering the rate to encourage them to return the activity back to the U.S.? Why does that cause a hole in the deficit?” he asked. “It doesn’t, it’s illogical.”
“Would you stake your reputation on the notion that this tax cut will not increase the deficit substantially?” Zakaria persisted.
“I have to wait and see before I give a deficit estimate,” Hassett responded after having spent the entire interview unabashedly extolling the tax plan.
Watching the video below via CNN: