Larry Summers, former Treasury secretary and Harvard University president emeritus, blasted the Trump administration for "real sacrifices of seriousness and credibility" about its tax reform proposal.
"We've seen an unprecedented level of factual errors and statements that aren't supported by any economic analysis from the administration on a range of questions," Summers told CNBC.
"In particular, the claims that it will produce enough growth to pay for itself in terms of the tax reform bill and the claims that it will be distributionally neutral and won't favor those with high incomes I think are indefensible and not supported by economists," said Summers, who also was an economic adviser to President Barack Obama and served as Treasury secretary under Bill Clinton.
Summers, now a Harvard professor, said meaningful reform would substantially simplify the tax code, increase incentives for purchasing equipment and encourage companies to bring back cash from overseas.
Summers has been a vocal critic of the president on everything from trade with China to his budget proposal to science.
"I never spoke this way about the proposals of the Bush administration, but I do think there are some real sacrifices of seriousness and credibility in the policy process in the way that tax change is being advocated," said Summers, the 71st United States Secretary of the Treasury from July 1999 until January 2001.
For his part, Trump on Wednesday told workers that they would win under his tax plan, saying it would help the middle class and boost the economy, though critics say it would mainly benefit corporations and the rich.
Speaking in an airplane hangar at a Pennsylvania Air National Guard base in Harrisburg with a trailer truck behind him, Trump reiterated the basic points of the nine-page tax cut “framework” he unveiled two weeks ago, Reuters reported.
“It’s a middle-class bill. That’s what we’re thinking of. That’s what I want,” Trump said.
“I’ve had rich friends of mine come up to me, and say, ‘Donald, you’re doing this tax plan -- we don’t want anything. ... Don’t give it to us. Give it to the middle class.’ And that’s what we’re trying so hard to do,” he said.
Financial markets have rallied strongly since Trump’s November 2016 election victory, driven partly by expectations that he would cut taxes for businesses, although policy analysts have been skeptical that he would do so.
Trump on Wednesday boasted about the rally in markets.
“The stock market is soaring to record levels, boosting pensions and retirement accounts for hard-working Americans. Their values are going up every single day,” he said.
Earlier on Wednesday, San Francisco Federal Reserve Bank President John Williams said he was a “little bit discouraged” about the prospects for federal tax reform.
Given the difficulties Congress has had in passing laws this year, Williams, in comments following a speech in Salt Lake City, said he is “losing confidence” that any tax reform will be passed in the next six months or so.
(Newsmax wires services contributed to this report).
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