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The fight between former President Obama and President Trump on claiming American economic prosperity has been heating up, but former Reagan economist Art Laffer declared the verdict is clear: President Trump caused the thriving Trump economy. “Trump has caused the Trump economy and deserves all the credit for it,” Laffer told FOX Business' Stuart Varney on Tuesday. “His policies are right on mark … and they really are his policies. President Trump understands the economy. Obama didn't.” Obama inherited an economy on the rocks after the market crashed in 2008, and, Laffer said, he was able to bring it back, albeit slowly. What Americans are seeing now in the Trump economy, he said, is a “continuation and a surge … that is second to none.” “President Obama is a fine man, but he’s not an economist,” Laffer said. Laffer said the seven-year-long recovery under Obama was the slowest in history and now Americans are flourishing in the boom Trump created thereafter. “This is the Goldilocks economy if I've ever seen one,” Laffer exclaimed. “And it's because President Trump understands economics … You get the growth of the U.S. staying at very high rates. You get tax revenues coming in nicely. You keep inflation under control. I mean, what's more to ask?”
What was possibly Larry Kudlow’s last Saturday radio program for a while, as he moves on to become President Trump’s top economic advisor. Beginning in the 39:00 mark, Larry talks with Art Laffer.
Investor’s Business Daily offers this staff editorial today in anticipation of President Trump’s tax plan specifics coming soon.
One other thing he suggested he would do: A one-time tax on repatriated overseas corporate retained earnings that are now kept in overseas accounts to avoid onerous U.S. taxation.
The estimated amount of these funds is staggering: $2.4 trillion. Even repatriating just two-thirds of that amount at 10% would add close to $160 billion to federal tax revenues.
Taken together, these form the core of an extremely supply-side oriented economic growth program that would create jobs and new incomes.
Nor is this a “tax cut for the rich,” as some have claimed.
As IBD noted last September, the “dirty little secret” of corporate taxes is that corporations don’t actually even pay them. Average Americans — that’s you — do. You pay it through lower wages, lower returns on investments and retirement accounts, and higher prices for the things you buy.
Dan Mitchell weighs in on what we know about President Trump’s tax plan(s):
On CNBC, Larry Kudlow is bullish on business tax cuts.
“Tax reform takes a long time,” he said. “I don’t know why they’re saying August. I think really a year or more is what it normally takes. I do think that the failure to deal with the healthcare bill puts more pressure on the Republicans and on the Trump administration to get a win on the board.”
Kudlow, was an economic adviser to the Trump campaign, said the key to a tax reform victory is to focus on business taxes first, even if that means running deficits over the next few years.
“Get the business stuff done,” said Kudlow, a radio talk-show host and CNBC senior contributor. “It will help the economy. We haven’t had business investment in 20 years. It’s a bipartisan critique I’m making. Go for the gold.”