Tags: kevin hassett | warren | ocasio | tax | economically | illiterate

Kevin Hassett: Warren, Ocasio Wealth-Tax Plans 'Economically Illiterate'

(James Steidl/Dreamstime)

By    |   Monday, 04 February 2019 12:23 PM

Democratic proposals like those from Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez targeting the wealthy don’t make sense, Trump economic adviser Kevin Hassett says.

“I see the Democrats pursue really economically illiterate proposals just because they think they sound good politically,” Hassett told CNBC.

Hassett spoke as potential Democratic challengers to President Donald Trump eye progressive tax ideas intended to reduce income inequality.

Warren has proposed an annual 2 percent tax on households worth more than $50 million.

Ocasio-Cortez, a freshman Democrat from New York, floated a 70 percent top tax rate on incomes of $10 million or more, an idea that 59 percent of people supported in a Hill–HarrisX poll conducted Jan. 12-13, Bloomberg reported.

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Independent Senator Bernie Sanders is proposing to expand the estate tax on wealthy Americans, including a rate of as much as 77 percent on the value of estates above $1 billion. Sanders, who ran in the Democratic primary against Hillary Clinton in 2016, hasn’t yet said whether he’ll run in 2020.

Polls show that voters are becoming more receptive to the idea of increasing taxes on the wealthy.

“I wish some economist would go and talk to these guys on how buybacks work,” Kevin Hassett, chairman of the president’s Council of Economic Advisors, told CNBC.

“It’s very disappointing that over and over again I see the Democrats pursue really economically illiterate proposals just because they think they sound good politically.”

Democrats should be “ashamed,” added Hassett, a former economist at the American Enterprise Institute and ex-senior economist at the Federal Reserve.

However, the concept of higher taxes on the wealthy hasn't been universally rejected.

JPMorgan Chase Chief Executive Officer Jamie Dimon, who leads one of Wall Street’s biggest banks, recently said that the ultra-rich could afford to pay more taxes as a wider political debate rages over increasing taxes for the wealthy.

“I believe that individuals earning the most can afford to pay more, and I have no problem paying higher taxes to address some of the fundamental challenges and inequities in our society,” Dimon said in a statement emailed by JPMorgan, in response to questions posed by reporters, Reuters reported.

“However, we need to ensure that our tax dollars are going where they can be most effective - like expanding the earned income tax credit and other programs that support the people and communities who really need it,” Dimon added.

Dimon’s remarks come as senior Democrats prepare to write a fiscal blueprint this year that would cut annual budget deficits and possibly include tax hikes on corporations and the wealthy.

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Material from Bloomberg and Reuters has been used in this report.

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Democratic proposals like those from Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez targeting the wealthy don’t make sense, Trump economic adviser Kevin Hassett says.
kevin hassett, warren, ocasio, tax, economically, illiterate
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2019-23-04
Monday, 04 February 2019 12:23 PM
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