Veteran financial guru and former Ronald Reagan adviser says the Congressional Budget Office’s analysis of the Republican proposal to replace Obamacare is misguided.
He took issue with the CBO’s forecast that shows cuts to the capital gains tax will not stimulate the economy. As commercial activity grows, tax collections will also increase, Kudlow said on cable channel CNBC.
The CBO is “scoring the capital gains tax cut as a $158 billion loss in revenue,” said Kudlow, who worked as Reagan’s budget deputy between 1981 and 1985.
“Down through the years if you lower the cap gains tax rate you get more investment and higher revenues and this one we're lowering it back to 20 percent from 23.8 percent. Maybe back to 15 percent,” said Kudlow, who served as the Trump campaign's senior economic adviser.
House Republicans last week published a proposal to unite the party behind a plan to replace the Affordable Care Act and deliver on a central campaign promise. The CBO this week forecast that the changes to healthcare policy would leave 24 million people without insurance and cut the federal deficit by $337 billion in the next decade.
The proposed plan would end a mandate requiring most Americans to have health coverage or pay a penalty, and a requirement that larger employers provide health insurance to workers. It also would repeal most of the health law’s taxes starting next year and freeze funding in 2020 for the 31 states that expanded Medicaid under the law.
Kudlow said the healthcare system should have a separate fund to help very ill people that require expensive treatments.
“Healthy people should be in different boxes than sick, ill people,” the Newsmax Finance Insider said. “The ill should be covered every one of them by government spending and subsidies.”
President Barack Obama in 2010 signed into law the ACA, the most sweeping overhaul of the U.S. healthcare system since the formation of Medicare and Medicaid in the 1960s. Obamacare sought to provide health coverage to an estimated 45 million uninsured Americans with a system of taxes, subsidies and mandates.
Obamare's popularity has been rising since the election and reached a record approval rating of 49 percent this month, according to Real Clear Politics. Its disapproval rating is a record low 44 percent in data going back to 2009.
“If you have the right reforms, it's pro-growth.,” said Kudlow, co-author of JFK and the Reagan Revolution: A Secret History of American Prosperity. “There are across-the-board tax hikes that will be knocked out.”
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