Norquist: Tax Reform Could Bring 4% Growth Rate

Submitted by emckee on Tuesday, May 30th, 2017, 3,10 PM

Grover Norquist, president of Americans for Tax Reform, appeared on CNBC’s Squawk Box this morning to discuss tax reform, which Norquist asserts will pass this year.

According to Norquist, there is considerable GOP consensus when it comes to tax reform:

“The only thing that isn’t going to happen is the status quo . . . The consensus in the House and the White House is fairly broad . . . There's a consensus to go to 15% or 20% on the corporate rate. There's a consensus that subchapter s corporations, pass-through companies, will also get 15% or 20% as well . . . There's an agreement to kill the death tax. There's no disagreement there. There's an agreement to get rid of the alternative minimum tax.

On the topic of full business expensing, Norquist commented, “I think partial [expensing] is a mistake. It's like cutting crab grass instead of pulling it out. We need to go to full and immediate business expensing to lower the cost of capital for new investment.”

Joe Kernen, referring to dynamic scoring as “voodoo economics,” questioned Norquist about whether tax cuts could increase economic growth. Norquist replied:

At the end of every failed Democratic presidency – Carter’s and Obama’s - they massively ramped up the deficit and spent a great deal of money and didn't care about the deficit when they were spending. Then they decided that they cared about the deficit in order to not lower taxes on working men and women in the United States. Carter took that position. Obama took that position. And then each of them, at the end of their term, said, “You know this lousy growth rate we have? That's not me. That's the world.”

The problem is, if you look at Obama's eight years and compare American growth rate versus the European growth rate, for the first six years, we were growing faster. . . It's in the last year and a half we're growing slower than Europe . . . So the idea that our lousy growth rate over the last eight years is some new normal, that's an effort to cover up failure. We do need to go back to the policies that Reagan did, which got you 4% growth.

Watch the full interview here.