- Larry Summers slammed Treasury Secretary Steven Mnuchin over his claims that the GOP tax plan will lead to huge growth. Summers was the Treasury secretary during the Clinton administration. He has come out swinging against Mnuchin on multiple occassions.
Larry Summers slammed Treasury Secretary Steven Mnuchin over his claims that the GOP tax plan will lead to so much growth that it won’t cost anything and will help pay down the federal debt.
“There is a range of estimates that a reasonable and thoughtful person could have and then there are estimates that, if you have them, you can really only have them if you were ignorant of the subject or if you were being motivated by politics,” Summers said in an interview with Politico’s Ben White.
“And I’m afraid the claims of Secretary Mnuchin that this would generate so much economic growth that it would pay for itself falls into that category,” he continued. “I’m not aware of so irresponsible an estimate coming from a Treasury secretary in the last 50 years.”
House GOP leaders took a step forward in an attempt to overhaul the US tax code by releasing the "Tax Cuts and Jobs Act" last week. The bill includes a broad set of proposed changes to the corporate and individual tax system, building off a nine-page framework that the White House and congressional Republican leaders released in September.
Ahead of the release of the bill, Mnuchin said at a conference in Washington, "Not only will this tax plan pay for itself, but it will pay down debt." He argued the proposal would fuel stronger growth, causing tax payments to rise and offsetting the revenue lost from lower rates, according to the WSJ. He added lower rates would discourage corporate tax avoidance.
Summers was the Treasury secretary during the Clinton administration and the director of the National Economic Council during the Obama administration. He has come out swinging against Mnuchin on multiple occassions.
Back in September, he criticized Mnuchin for his comments about President Donald Trump's attacks on NFL player protests.
And in May, he wrote an op-ed for The Washington Post criticizing Mnuchin's speech to bankers at Michael Milken's annual conference for investment professionals in which he said "you should all thank me for your bank stocks doing better."
Summers wrote:
"I cannot conceive of any of the 11 other secretaries I have known making such a statement. Leave aside the question of whether whatever credit is to be claimed should be claimed on behalf of the president. Since when is the stock price of banks the objective or the standard of success for economic policy? And when, as will inevitably occur, bank stock prices decline, will the secretary accept the blame?"