INTEGRITY OF THE ELECTION, THE
SUPREME COURT AND THE ECONOMY.
TO GET A JUMP ON THE ECONOMY
PART, WE FIRST WELCOME WHITE
HOUSE NATIONAL ECONOMIC COUNCIL
DIRECTOR LARRY KUDLOW AND AFTER,
WE WILL GIVE EQUAL TIME TO BIDEN
ECONOMIST BEN HARRIS.
LARRY, GREAT TO HAVE YOU ON THE
SHOW.
UP UNTIL THE COVID CRISIS, LET’S
START WITH THIS, THE PRESIDENT
CONSISTENTLY SAID THE U.S. IS
ENJOYING THE GREATEST ECONOMY ON
RECORD AND INDEED, UNEMPLOYMENT
WAS AT HISTORIC LOWS, S&P
ENJOYED 128 RECORD CLOSES BUT
ONCE COVID HIT, WE DID SEE
LIVING PROOF OF PERHAPS HOW
SHALLOW EMPLOYMENT WAS FOR MANY
AMERICANS.
IT EXPOSED HOW THEY WERE LIVING
HAND-TO-MOUTH AND YES, JOB
CREATION SPIKED IN TRUMP’S FIRST
THREE YEARS, WAGES MOVED UP, BUT
SURVEYS SHOW ONLY 40% OF U.S.
ADULTS HAVE 400 IN SAVINGS.
32 MILLION FILING FOR
UNEMPLOYMENT.
FOOD BANKS OVERWHELMED.
SO HERE’S MY QUESTION.
CAN YOU REALLY SAY THE ECONOMY
WAS AMAZING FOR EVERYONE, THE
BEST EVER, AND SHOULD PRESIDENT
TRUMP WIN A SECOND TERM, WHAT
WILL HE DO TO FIX THAT, GIVE IT
MORE DEPTH?
>> WELL, LOOK, LIZ, WITH
RESPECT, EVERY SINGLE MEASURE
SHOWS THAT PEOPLE WERE BETTER
OFF AND I’M TALKING ABOUT THE
CENSUS BUREAU MEASURES ON
FEDERAL INCOME, THE FEDERAL
RESERVE, CONSUMER FINANCE
MEASURES.
I CAN’T VOUCH FOR EVERYTHING YOU
MENTIONED, BUT THOSE ARE THE
MEASURES, 2017, ’18 AND ’19.
THIS IS THE FIRST RAISE IN
WAGES, YOU CAN CALL IT FAMILY
INCOME OR CALL IT PLAIN OLD
LIVING STANDARD, THE FIRST
INCREASE FOR MIDDLE AND LOWER
MIDDLE CLASS AMERICANS REALLY
SINCE THE YEAR 2000 BUT MOST
PARTICULARLY, MUCH GREATER THAN
ANYTHING DONE IN THE PRIOR EIGHT
YEARS.
THE PRESIDENT TAKES GREAT CREDIT
FOR THAT AND HE’S VERY PROUD OF
THAT.
YOU CAN GO THROUGH ANY OF THESE
NUMBERS.
THE INCREASE LAST YEAR, $4400.
THAT’S AFTER INFLATION.
FIVE TIMES THE RATE THAT WE HAD
IN THE PRIOR EIGHT YEARS, FOR
THE WHOLE EIGHT-YEAR PERIOD, AND
IF YOU LOOK AT THE WAGE NUMBERS
AND THE JOB NUMBERS, IT’S JUST
NOT TRUE.
PRE-PANDEMIC IT WAS THE MIDDLE
CLASS, THE BLUE COLLARS AND
LOWER, WHO HAD THE LARGEST WAGE
GAINS, MUCH BIGGER THAN THE TOP
10% OR EVEN THE TOP 1%.
THOSE ARE WAGES.
THESE ARE TERRIFIC NUMBERS AND I
WILL SAY THAT THE POLICIES OF
LIBERALIZING THE ECONOMY AND
PROVIDING INCENTIVES, LOWERING
TAXES ACROSS THE BOARD AND
DEREGULATION, PARTICULARLY AMONG
SMALL BUSINESS, UNLEASHED A WAVE
OF MIDDLE CLASS PROSPERITY THE
LIKES OF WHICH WE HAVEN’T SEEN
IN OVER 20 YEARS.
LIZ: WELL, I’M GLAD YOU BROUGHT
UP THE TAX CUTS BECAUSE THE GOP
AND PRESIDENT TRUMP’S TAX CUTS
AND JOB ACT SIMPLIFIED TAX
BRACKETS, CUT TAX RATES,
SPECIFICALLY, THOUGH, TO
CORPORATE TAX RATES, IT WENT
FROM 35% OF COURSE AMONG THE
HIGHEST IN THE DEVELOPED WORLD,
ALL THE WAY DOWN TO 21%,
ARGUABLY MAKING US MORE
COMPETITIVE, LURING BUSINESS
BACK TO THE U.S.
THE PRESIDENT SAID THE TAX CUTS
FOR CORPORATIONS WOULD PAY FOR
THEMSELVES.
BUT LARRY, THEY HAVE NOT.
2018, THE FIRST YEAR, SO I’M
TAKING OUT COVID BECAUSE THAT IS
JUST A FORCE MAJEUR SITUATION
BUT THE FIRST YEAR OF THE TAX
CUTS, REVENUE SHORTFALL WAS
ALMOST IMMEDIATE.
CORPORATE TAX REVENUES PLUMMETED
31%.
YOU CAN SEE ON THE SCREEN, FROM
$297 BILLION TO $204 BILLION.
WHY SUCH A MASSIVE SPIKE IN THE
DEFICIT?
WHAT HAPPENED TO THE PROMISED
REVENUE?
>> LIZZY, SURE, RIGHT AFTER THE
TAX CUT YOU WILL SEE DROP IN
REVENUES, OKAY?
YOU GO FROM 35% TO 21%, ALL
RIGHT.
COMPANIES GET TO HOLD MORE OF
THEIR OWN MONEY, LARGE AND SMALL
BUSINESSES, NEW INCENTIVES,
FABULOUS RETURNS WHETHER YOU ARE
A SMALL BUSINESS OR A PUBLICLY
HELD COMPANY.
OF COURSE.
HOWEVER, IF YOU LOOK AT THE CBO
NUMBERS, WE HAVE BEEN THROUGH
THIS WITH A FINE-TOOTH COMB.
EVERY TIME THE CBO DOES A STUDY,
BEFORE TAXES, BEFORE THE TAX CUT
AND AFTER THE TAX CUT, THEY
SHOWED THAT THE INCREASES IN
NOMINAL GDP FROM WHICH REVENUES
COME, AND THEREFORE THE INCREASE
IN REVENUES, ACTUALLY ROSE
SIGNIFICANTLY.
NOW, NOT IN THE FIRST QUARTER OF
2018, BECAUSE THE BILL WAS
SIGNED IN DECEMBER.
BUT ONCE YOU GET INTO LATE ’18
AND ALL OF ’90, THE CORPORATE
TAX CUTS HAVE MORE THAN PAID FOR
THEMSELVES.
IN FACT, THE LAST PRE-PANDEMIC
MEASURE FROM THE CBO SHOWED THAT
ALMOST THE ENTIRE PACKAGE, THEY
SHOWED, IF I’M NOT MISTAKEN,
EITHER 1.2 TRILLION OR 1.3
TRILLION IN INCREASED REVENUES
FROM THEIR EARLIER ESTIMATE.
THE BILL WAS ESTIMATED AT 1.5.
I JUST CAN’T AGREE WITH YOU, I’M
SORRY.
YOU AND I ARE OLD FRIENDS BUT I
GOT TO PUSH BACK ON THIS STUFF
BECAUSE THAT’S WHAT THE NUMBERS
SHOW.
LIZ: I’M TELLING YOU THE NUMBERS
ALSO SHOW PRESIDENT TRUMP HAD
$297 BILLION IN CORPORATE TAX
RECEIPTS IN 2017 AND THEN THEY
DROPPED.
THEY ARE CLIMBING BACK AND THE
EXPECTATION IS TO SEE IN 2020 --
>> THEY HAVE BEEN DROPPING.
OF COURSE, WHEN YOU --
LIZ: AS YOU SAY, BUT --
>> -- THE FIRST INSTANCES, YES,
BUT AS THE GROWTH TAKES HOLD AND
THE JOB CREATION TAKES HOLD, AND
PEOPLE COME INTO THE WORK FORCE
WITH HIGHER WAGES WHICH IS
EXACTLY WHAT HAPPENED, THEN YOU
SEE YOUR TAX REVENUES GO UP.
LOOK, THE THEORY HERE, I BELIEVE
IT WAS PROVEN OUT, LOWER
CORPORATE TAXES PROVIDED THE
BIGGEST BENEFIT TO THE MIDDLE,
THE BLUE COLLARS, THE MAIN
STREET AND THE LOWER WAGE
INCOME.
THEY HAD LARGER PERCENTAGE GAINS
THAN THE UPPER GROUP.
THAT’S WHAT WE HAD PROMISED.
WE HAD PROMISED THEM HIGHER
LIVING STANDARD AND MORE JOBS
AND HIGHER WAGES AND THAT’S WHAT
THEY GOT.
LIZ: OKAY.
I WANT TO GO TO INFRASTRUCTURE.
SPECIFICALLY THE PRESIDENT’S
PLAN VERSUS DONALD TRUMP’S PLAN.
WHEN YOU TALK ABOUT THAT, YOU
KNOW, IT’S INTERESTING TO SEE
THAT JOE BIDEN’S WEBSITE, HE
EXPECTS TO HAVE $2 TRILLION IN
INFRASTRUCTURE SPENDING.
A LOT OF IT IS SIMILAR TO WHAT
THE ACTUAL SPENDING FOR
PRESIDENT TRUMP IS PROMISED TO
BE, THAT’S TRANSIT, ALL KINDS OF
INVESTMENT IN HIGHWAYS, NOT TO
MENTION BUILD OUT A 5G AND
BROADBAND.
HOWEVER, WE ARE STILL WEIGHT ONA
AN EXACT FIGURE.
I HAVE HEARD 1.5 TRILLION, I
HAVE HEARD 1 TRILLION.
CAN YOU CLARIFY THE NUMBER FOR
OUR VIEWERS?
>> WELL, NO, I CAN’T, AT THIS
POINT I CAN’T, BECAUSE THESE ARE
GUESSTIMATES, OKAY?
MR. BIDEN’S ARE GUESSTIMATES.
LOOK, WE TRIED TO NEGOTIATE A
BIPARTISAN INFRASTRUCTURE BILL
ON SEVERAL OCCASIONS.
I PERSONALLY WAS IN THE ROOM, I
WAS DEEPLY INVOLVED IN THIS.
BUT WE COULDN’T.
WE JUST COULDN’T MAKE A DEAL
WITH THE DEMOCRATIC HOUSE AND
REPUBLICAN SENATE.
WHAT’S GOING TO HAPPEN, MY GUESS
IS, THE HIGHWAY BILL, SO-CALLED,
WILL BE EXTENDED THROUGH THE END
OF THE YEAR, MAYBE NEXT MARCH,
MAYBE THAT WILL BE 80 OR $100
BILLION BUT YES, PRESIDENT TRUMP
WANTS TO INCREASE INFRASTRUCTURE
AND BY THE WAY, HE SAID MANY
TIMES NOT ONLY ROADS, BRIDGES,
TUNNELS, VERY IMPORTANT, OKAY,
IT’S ALSO PIPELINES AND ENERGY
TERMINALS.
IN OTHER WORDS, WE HAD EXECUTIVE
ORDERS WHICH HAVE OPENED THE
DOOR TO THE BUILDING OF
PIPELINES, NORTH, SOUTH, EAST,
WEST, SO THAT THIS GIGANTIC
BULGE IN NATURAL GAS WHICH IS A
CLEAN FUEL CAN HELP THE EAST AND
NORTHEAST STATES SO THEY DON’T
HAVE TO BUY THEIR ENERGY FROM
RUSSIA.
AND WE ARE GOING TO DO IT ON THE
OTHER SIDE, TOO, UP THROUGH
ALASKA INTO THE PACIFIC.
SO THAT’S ONE OF THE THINGS THAT
HE WOULD LOVE TO DO.
UNFORTUNATELY, MR. BIDEN WANTS
TO SHUT DOWN FRACKING AND
ESSENTIALLY END FOSSIL FUELS AND
I THINK THAT WOULD BE DISASTER.
LIZ: I WANT TO GET QUICKLY TO
THE ELEPHANT IN THE ROOM,
ENTITLEMENTS, SOCIAL SECURITY,
MEDICARE, MEDICAID.
GUYS LIKE BILLIONAIRE HOME DEPOT
FOUNDER KEN LANGONE FROM SAID
MANY TIMES MEANS TEST FOR SOCIAL
SECURITY, MEANING REDUCE OR
ELIMINATE BENEFITS FOR HIGHER
INCOME RECIPIENTS LIKE HIM.
100 MILLIONAIRE, BILLIONAIRE
CLASS, WOULD YOU BE FOR, IS THE
PRESIDENT FOR MEANS TESTING?
>> NO, HE HASN’T SPOKEN ON THAT
AT ALL.
LOOK, KEN LANGONE IS A GREAT MAN
AND FRIEND.
I WOULD JUST SAY THIS.
RIGHT NOW, RIGHT NOW PRESIDENT
TRUMP WANTS TO DEFER THE PAYROLL
TAX WHICH WOULD GIVE A 6.25%
RAISE --
LIZ: DOESN’T THAT BORROW FROM
SOCIAL SECURITY LATER?
>> NO, IT DOES NOT, BECAUSE JUST
AS THE OBAMA ADMINISTRATION DID
IN 2010 OR ’11, YOU BORROW SOME
MONEY, YOU RUN IT THROUGH THE
GENERAL FUND, THEN YOU EXCHANGE
IT FOR NON-MARKETABLE TREASURY
CERTIFICATES WITH THE SOCIAL
SECURITY TRUST FUND.
IT’S A SHORT-TERM MEASURE.
WE WOULD LIKE TO CREATE NEW WORK
INCENTIVES NOT ONLY FOR THOSE
WHO ARE OPPORTUNE ENOUGH TO HAVE
JOBS THROUGH THIS PANDEMIC BUT
FOR THOSE COMING INTO THE WORK
FORCE.
WE ARE GOING TO OFFER THEM, IT’S
ABOUT $1,000 PER PERSON.
NOW, LONGER TERM, LONGER TERM,
WE WILL LOOK AT ALL THESE
MEASURES.
RIGHT NOW, THIS IS NOT THE TIME
TO DO THAT.
IT’S NOT THE TIME TO BE RAISING
TAXES ON ANYBODY.
YOU JUST HAD A PANDEMIC
CONTRACTION.
YOU YOURSELF WERE QUOTING ALL
THESE NUMBERS AND HOW BAD IT
WAS.
I THINK IT’S RECOVERING WITH A
TERRIFIC STRONG V-SHAPE.
IN ANY EVENT, IN ANY EVENT, THIS
IS NOT THE TIME TO RAISE TAXES
OR REGULATIONS.
I THINK MR. BIDEN IS OUTSIDE THE
MAINSTREAM.
HE WANTS TO ACROSS THE BOARD TAX
HIKES AND THAT WOULD HIT
EVERYBODY.
LIZ: NOT TRUE.
WE WILL GET TO THAT IN JUST A
MINUTE.
HE DOES SAY, LARRY, JUST TO
CLARIFY, BECAUSE WE ARE DEALING
WITH FACTS, BIDEN HAS SAID THAT
HE WILL NOT TAX ANYBODY WHO
MAKES $400,000 OR LESS.
BUT LARRY, WE HAVE GOT TO RUN
BECAUSE WE ARE GIVING EQUAL TIME
TO BOTH OF YOU.
>> THAT’S A GREAT POINT THAT HE
MAKES.
BUT THE REALITY IS HE’S GOING TO
REPEAL THE TRUMP TAX CUTS.
IT’S THE TRUMP TAX CUTS THAT
PROVIDED MASSIVE NEW BENEFITS
FOR THE MIDDLE CLASS.
YOU REPEAL THOSE TAX CUTS, YOU
ARE GOING TO TAKE THOSE BENEFITS
AWAY AND THIS IS THE WRONG TIME
TO PICK THE POCKETS OF MIDDLE
INCOME BLUE COLLAR WORKERS GOING
BACK TO WORK.
LIZ: LARRY, THANK YOU.
I KNOW IT’S A BUSY DAY FOR YOU.
WE SO APPRECIATE YOU COMING ON
"THE CLAMAN COUNTDOWN."