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Laffer Associates Founder Art Laffer on the state of the economy and the Presidential Candidates’ different tax and economic plans.
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Hello everybody I'm Gerri Willis two debates down one to go.
President Obama and Mitt Romney back on the campaign trail today following last night's second presidential debate.
Election Day believe it or not twenty days away.
Last night's debate was intense but didn't change the momentum for either candidate.
Let death economist and former Reagan economic advisor art Laffer he's the founder and chairman of Laffer associates are welcome back to the show what I really want to focus on -- share.
It's let's talk about the most important issue to Americans out there and that is the economy the president last night describing.
Mitt Romney's plan as a -- -- deal he says you can't cut taxes 20% across the board.
Get rid of some deductions -- ever have a hope a balancing the budget and you say.
-- -- -- -- I think it's wrong I think their presence completely incorrect in 1986 Gerri we cut the highest tax rate in America from 50% to 28%.
That a good enough cut Korea.
We -- we -- lowest we've broadened the base and we had a boom and have almost every Democrat voted for it I mean all Joseph Biden voted for it.
Chris Dodd voted for Teddy Kennedy vote report and that more brought in huge -- of revenues -- brought in huge prosperity.
You know -- the easiest thing in the world to do was to lower those tax rates.
Broaden the tax base make it revenue neutral just as Reagan required it to be and you will see a boom and -- From what I see that's exactly what Mitt Romney is proposing.
Well and -- Terry -- -- budget on the backs of the unemployed it just you can't.
Well I would get about half -- they -- American people who are not paying federal income taxes so that makes it hard to right now.
I want you -- some sound from last night this is a question that the president took from the audience what you hear the exchange.
Mr.
President voted for you in 2008.
What have you done or accomplished -- vote in 2012.
I'm not that optimistic as I was in 2012.
Most things I need to put everyday living very expensive.
Four years ago.
I told the American people I told you -- cut taxes for middle class families.
And I did.
-- -- cut taxes for small businesses and I have.
I think you know better.
I think you know that these last four years have meant so good.
So aren't you you look at the economy as we've experienced it I don't think that.
The recession was over -- in the spring of 2009.
What do you make of the economy's performance now.
Well is the single worst recovery in the history of the US Jerry.
I mean it's it's an awful recovery it's as far below the next worst as the next worst is below the best.
Well and -- certainly got a long way to go up -- you have seven point 8% unemployment.
We can't 44 million Americans not working day you've got a question what's going on.
Where the big issues taxes.
Now the president said that exchange appear heard it these lowered taxes for small business but when you really look at that -- what's going reasonably well.
Yeah bless you are everybody's got something right now you -- oh my gosh what -- Ed -- yet.
I've never done that before the and fortunately I have I think I'll get.
But rewarding we have learned though is that this small business Jackson the president talks about it's actually.
A tax deduction.
For health care.
And it's so complicated the most small businesses don't want to take -- the IRS ends up trying to talk people in that taking this deduction.
So when you look at the performance.
-- it's just not up to snuff isn't.
No it's not know that that president claiming that he's cut taxes is ridiculous he has not.
He has also proposed very sharp tax increases.
You've got obamacare coming on January 1 2013.
You've got the elimination of the bush share -- tax cuts you've got the payroll tax.
Cut cut that's going to be eliminated on January 1 2013 you've got the deductions for.
Capital expenditures a 100% expenses that's all gone if we get to January 13 that he allows all of that to happen.
You will see a very serious downturn in the US economy.
This economists' view of the world well and it's and very serious problem.
I quit I way to respond as well to Obama's comments directly aren't Romney's tax plan with -- that's.
-- What he says -- he's going to.
Make sure that this doesn't add to the deficit.
And he's gonna cut middle class taxes.
But when he's asked.
How are you gonna -- which deductions.
Which loopholes they're gonna close he can't talk we haven't heard from the governor.
Any specifics beyond big bird and eliminating funding for Planned Parenthood in terms of how -- pays for that.
An -- how do you respond to that.
You know -- responded just the way we did the 86 tax act you know congress gets to make the legislation.
They go through all the deductions exemptions and exclusives and choose which ones they want to do now what then what Romney has said as he would limit the deductions for every single person.
So that's that's that's a ceiling.
And if you do that ceiling and lower the rates the way he suggested.
It will not cause any increase in the deficit whatsoever and will bring back prosperity so.
Romney has laid out the broad outline without going to each little detail.
And it's better -- I don't even know what Obama's plans are over the next four years or what they Bedanova -- -- As well earlier and that raises -- hello your kettle of fish right I mean we're not really seeing what those other plants might be I wanna play one more piece of -- for me this is.
Finally Rodney -- online by the middle class being crushed.
Listen to this.
The middle class is getting crushed under the policies of -- president.
Who is not understood what it takes to get the economy working again.
He keeps saying look -- treated five million jobs that's after a -- losing five million jobs.
The entire record is such that the unemployment.
Has not been reduced in this country.
What do you make of that.
-- chart with its correct I mean we've had a huge drop in the participation rate.
A people have just dropped out of the labor force -- because they can't find jobs they know -- no longer we consider themselves in the labor force we have a part time.
Labor force that would like to be full time but they can't find a full time job.
And we have high unemployment.
As I said before this is the single worst recovery in the history of the US and why Obama continues to say he's created all these jobs that's nonsense.
The labor force -- of -- a lot more than.
The jobs he's created that would be a lot higher unemployment rate -- -- they had these are people left the labor force growth is the hills are the only answer.
And -- -- it's the answer to poverty to the best form of welfare is still a good high paying job I agree well our thanks for coming on I hope you feel better.
Maybe a little TM -- Biden just.
I've never -- that they can Gerri thank you out there that BI but.
