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Former White House Economic Advisor Art Laffer on the impact on the economy of tax increases for the wealthy.
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Case study out today by the Pew Research Center finds that 44% of people believe raising taxes on those making more than 250000.
Dollars a year would indeed help the economy but we have a top economists -- -- these tax hikes a growth -- up.
Art Laffer is a former White House.
Economic advisor he joins us now.
In -- first on Fox Business interview are right -- -- -- a lot of people say raising taxes on the job creators as the precise thing that will kill growth.
Except that they had very accommodative tax rates since the bush years.
And we haven't really seen a lot of -- a lot of job growth why do you feel.
It in opposite of what forty more than 40% of Americans feel that it's time to perhaps -- readjust tax rates on the wealthy.
-- it I don't mind readjusting tax rates at all is in fact what I'd like to see is see of them lower and broaden the base dramatically.
And come towards a flat tax that's -- -- like to -- is go but.
It makes no sense honestly to raise taxes.
On the top and comers the people who provide everyone else would jobs output employment.
You know in this type of economy I've never heard of an economy.
Being taxed in the prosperity now maybe I missed that'd be -- but it it doesn't make much test -- were higher under Bill Clinton.
And we have as we -- certainly had a surplus.
Short and he had cut government spending was cut as a share of GDP by more than the next four best presidents combined.
We got rid of the retirement test on Social Security we push NAFTA through congress.
We had the biggest capital gains tax cut in our nation's history I mean Clinton was a great president -- voted form twice just so you know.
But this is no Bill Clinton today with Barack Obama -- W wasn't much better either to be honest -- -- the two are very similar.
This spending is way out of control what you want to do is have a low rate flat tax and spending restraint and somebody.
And after listening to Wayne -- I don't think he thinks the Bernanke's doing a great job unsound money either and.
But is -- some sort of limit odds of a number of tax breaks you give them to you know there are many who of course you say look.
Where -- the jobs than those who -- the most money.
-- of course there are limits to what I mean you've got to have taxes I mean you have to have all sorts of things that government doesn't government doesn't really well.
But what you want to do is make sure you have a tax code.
That is low rate and a broad base -- provide people with -- -- incentives to evade avoid or otherwise not report taxable income.
And they give them the least places to which they can escape.
We need the 1986.
Tax act brought back.
In 198697.
Of the senators.
Voted in favor of the night.
86 tax act which dropped the highest rate from 50% to 28% but I'm looking in the -- this fire that they offer today the capital gains rate was higher.
It was yes that that that was a mistake I think -- that tax -- but on balance that was a great tax act.
And the capital gains tax rate was higher but the personal income rate was much lower one of the things -- to -- -- about the Clinton there which I think is absolutely right on the money of that is that there was.
Cutting of spending.
And there was slightly higher tax -- certainly but you also had -- to both sides working together art you don't have that at all and especially as we -- but we don't.
An election are we gonna see anything between the two sides -- you well.
After the election about the.
-- he had very definitive -- election.
After that you'll see both sides come together working just the way it happened and after Reagan was elect -- -- we passed our tax bill in August of 81.
With 35 of the 45 Democrats voting with us on a 25% tax cut.
We got almost every Democrat in these six tax act they worked together because you had a clear answer politically.
This president doesn't know how to run an economy he hasn't brought it back and is not very different from W as far as I'm concern -- -- W was a bad present.
Obama is matched and that's for sure.
But we need a new different direction of a pro growth agenda will get it and that everyone will come back content side together.
And you'll see bipartisanship really work well -- Boy I wish.
So which sadly true and how does a fluffy clouds hey -- you're probably -- before.
Hey you -- sixteen trillion that debt level here is surely that cannot be cut down -- would just spending cuts is that we -- suggesting.
Well I think -- -- that spending cuts and revenue growth.
-- I'm all in favor of tax revenue growth but not by raising rates.
By broadening the base and creating economic growth if we got our economy back up to full employment.
You would have an enormous surge in tax revenues which is what we all want.
But we do need to spending cuts as well to bring us back in the balance and you know that doesn't take a rocket surgeon to do that.
You can't love jobs and hate job creators you just can't -- that's what this administration's been doing.
Art I really found this an interesting conversation we learned some things about you about that -- -- -- the fair and -- the idea thank you it's great to talk to you on the subject.
Well it's my pleasure to regulars at a -- -- flattener former White House economic advisor to listen up.
