WE WANT TO RATCHET THAT UP.
MARIA: .
WE WANT TO BRING IN GROVER
NORCHRIS.
THANK YOU FOR BEING HERE L.
YOU'RE HEARING THE CONVERSATION.
WEIGH IN HERE.
THE PRESIDENT IS WEIGHING
OPTIONS TO SPUR THE ECONOMY LIKE
POTENTIAL CAPITAL GAINS TAX,
LIKE A POTENTIAL PAYROLL TAX.
WHAT'S YOUR VIEW.
>> HE PUT TWO THINGS ON THE
TABLE.
THE DIFFERENCE BETWEEN THEM IS
THAT INDEXING CAPITAL GAINS SO
YOU DON'T TAX INFLATION IN
CAPITAL GAINS CAN BE DONE
UNILATERALLY BY THE PRESIDENT.
THE SUPREME COURT RULED THAT IN
120002.
SO -- 2002.
SO THAT'S NO LONGER A LEGAL
QUESTION.
THE PRESIDENT SAID YESTERDAY I
CAN DO THIS MYSELF.
THE TREASURY SECRETARY COULD DO
THAT.
THE ADVANTAGE THERE IS ONCE YOU
DO IT, HALF OF AMERICANS PLUS
OWN HOME, HALF OF AMERICANS PLUS
ARE IN THE STOCK MARKET.
YOU CAN'T ARGUE THIS IS A TAX
CUT FOR THE 1%.
IT'S A TAX CUT FOR EVERYBODY
OVER 55 WHO HAS HELD HOMES AND
HOUSES AND AN IMMEDIATE TAX CUT,
VERY QUICKLY, BENEFITS ANYONE
WHO IS 2 A 5 AND STARTING THEIR
LIFE BECAUSE THEIR ASSETS ARE
WORTH MORE.
IF YOU GO WITH A TAX CUT ON
SOCIAL SECURITY AS A SUGGESTION,
THE DEMOCRATS IMMEDIATELY GO
SURE, WE'LL PAY FOR IT BY
RAISING THE BUSINESS TAX, THROW
IT RIGHT BACK.
SO BECAUSE NANCY PELOSI HAS TO
AGREE TO ANY CHANGE IN THE
SOCIAL SECURITY TAX AND THE
DEMOCRATS HAVE NEVER DONE THAT
WHEN THEY HAD THE POWER TO DO
IT, THEY WOULD JUST PLAY
POLITICS WITH IT.
THE PRESIDENT WILL LIKELY GO
WITH THE THING WHERE THE
INFLATION INDEXATION -- HE CAN
DO THAT BY HIMSELF WITHOUT NANCY
PELOSI'S PERMISSION.
>> HEY, GROVER, STEVE MOORE
HERE.
GREAT TO SEE YOU.
>> HI, STEVE.
>> LOOK, YOU SOUND VERY
CONFIDENT THAT THE PRESIDENT HAS
THE UNILATERAL AUTHORITY TO DO
THIS AND HE HAS THE LEGAL --
THAT SEEMS TO BE AN OPEN
QUESTION.
I WANT TO DIG IN, GET YOUR
REACTION TO -- BECAUSE YOU SEEM
LIKE IT'S AN OPEN AND SHUT DEAL
THAT HE CAN DO THIS.
I KNOW THE DEMOCRATS WOULD
PROBABLY CHALLENGE THAT.
SO THAT NUMBER ONE.
NUMBER TWO, WHAT I LIKE ABOUT
THAT IDEA OF INDEXING CAPITAL
GAINS TAX AND TELL ME IF I'M
WRONG ABOUT THIS IS YOU GET AN
UNLOCKING EFFECT.
NOW PEOPLE COULD SELL THEIR
STOCKS AND MOVE INTO YOU NEW
COMPANIES AND NEW INVESTMENT
OPPORTUNITIES.
WHAT IS YOUR REACTION TO THAT.
MARIA: BY THE WAY, BEFORE YOU
GET THERE, YOU SAY COULD HE DO
IT, DON'T FORGET, OBAMA INDICT.
THE PAYROLL TAX WAS CUT UNDER
THE OBAMA ADMINISTRATION IN 2011
AND 2012 TO 4.2%, REDUCING TAXES
BY MORE THAN $100 BILLION EACH
YEAR.
IT WAS ENACTED TO ENCOURAGE MORE
CONSUMER SPENDING.
>> THE QUESTION IS CAN THE
PRESIDENT DO IT WITHOUT
CONGRESSIONAL APPROVAL.
THAT'S THE ISSUE ON THE TABLE.
>> LET'S TAKE THAT IN THE ORDER
IN WITH WHICH YOU ASKED.
ONE, CAN THE PRESIDENT DO IT.
THERE WAS A DEBATE ON THIS IN
1992 AND SOME SERIOUS LAWYERS
SAID ABSOLUTELY -- LIKE CHUCK
COOPER, OTHERS SAID WE'RE NOT SO
SURE.
SINCE THEN THERE WAS A SUPREME
COURT DECISION IN 2002 WHICH
ANSWERED THE ONLY QUESTION
BEFORE, IS COST AN UNAMBIGUOUS
TERM THAT AN AGENCY CANNOT
ADJUST.
THEY SAY IT COULD BE HISTORIC
COST, WHAT DID YOU PAY FOURTH,
REAL
FOAL
FORL
FOR IT,REAL OF COST, COST PLUS
INFLATION, AND REPLACEMENT COST.
THERE ARE MANY WAYS TO DECIDE
WHICH ONE TO USE.
THE SUPREME COURT SMACKED AWAY
HARD ANY DEBATE.
SOME PEOPLE THINK THE COURTS, A
MORE CONSERVATIVE COURT MIGHT
WANT TO REDUCE THE ABILITY OF
AGENCIES TO MAKE THOSE
DECISIONS.
A MONTH AGO WE HAD A DECISION
THAT SAID NOPE, WE'RE NOT DOING
THAT.
SO TWO SUPREME COURT DECISIONS
COME IN THAT SAY AGENCIES HAVE
THIS AUTHORITY.
THEY HAVE THIS AND COST
SPECIFICALLY IS NOT AN
UNAMBIGUOUS TERM.
THAT'S WHY WE CAN SAY WITH
CLARITY THAT THEY'LL POLITICALLY
WINE
PLNE
PLIGHTWHINE ABOUT IT BUT NOT HAV
PLIGHTWHINE ABOUT IT BUT NOT HAE
SUCCESS.
THE BIG BENEFIT RIGHT AWAY IS
ONE CEO, FORTUNE 500 CEO TOLD ME
THERE'S $7 TRILLION OF STICKY
CAPITAL WHICH IS LAND,
BUILDINGS, OTHER COMPANIES THAT
CORPORATIONS ALONE, NEVER MIND
INDIVIDUALS WHO OWN HOMES AND
STOCKS BUT CORPORATIONS OWN
$7 TRILLION OF STICKY CAPITAL
MUCH OF WHICH WOULD BE SOLD.
IN FACT, ALMOST ALL OF WHICH
WOULD BE SOLD WHEN YOU'RE
LOOKING AT THINGS THAT ARE FIVE,
10, 20, A 50 YEARS OLD.
THAT WOULD RAISE A LOT OF
REVENUE IN A SHORT PERIOD OF
TIME AND TAKE TRILLIONS OF
DOLLARS AND REDIRECT IT TO
HIGHER AND BETTER USE.
IT'S DEREGULATION FOR PAST
PURCHASES OF ASSETS AND IT
RAISES THE VALUE OF ALL ASSETS
IN THE UNITED STATES NOW GOING
FORWARD.
THE ONE COMPANY THAT CALLED ME
ABOUT THIS EARLIEST IS AMERICANS
FOR TAX REFORM, THE GROUP
STARTED TALKING TO EVERYBODY IN
THE WHITE HOUSE.
EVERYBODY IN THE WHITE HOUSE IS
FOR IT AND UNDERSTANDS IT.
THAT'S NOT A BAD PLACE TO START,
BEGINNING WITH THE PRESIDENT.
THEY KNOW PEOPLE EMPTY CLOSETS
AND ATTICS OF ALL OF THIS
BASEBALL CARDS AND ART WORK THAT
THEY'VE HELD ONTO BECAUSE OF THE
TAX ON INFLATION.
>> IS EVEN STEVEN MNUCHIN IN
FAVOR OF THIS.
I HEARD IN THE TREASURY THERE'S
DOUBTS ABOUT THIS.
>> THERE'S ALWAYS MNUCHINS IN
THE TREASURY THEY SAY IT MAY NOT
WORK FOR THEM.
HE SAID I'D LIKE CONGRESS TO DO
IT BUT I MAY HAVE TO DO IT
MYSELF.
AND HE HAS TOLD ME
AND HE HAS TOLD PEOPLE THAT HE
KNOWS HE DOES HAVE THE
AUTHORITY.
AGAIN, IT'S CLEAR IN LEGAL
TERMS.
MARIA: DID YOU SAY THERE'S
ALWAYS MUNCH KINS IN THE WHITE
HOUSE?
>> I'M SORRY, MUNCHKINS FROM THE
WIZARD OF OZ, NOT MNUCHIN.
MARIA: THAT'S WHAT I THOUGHT.
MUNCHKINS.
YOU'RE TALKING ABOUT MNUCHIN.
>> THE MUNCHKINS ARE BAD ON IT.
MARIA: WHAT'S YOUR STANCE ON
THE ECONOMY?
DO YOU SEE A RECESSION ON THE
HORIZON.
IT'S GOT ME BAFFLED.
I THOUGHT THINGS WERE GOING
REALLY WELL.
>> THINGS ARE GOING MUCH BETTER
THAN THEY WERE.
WE WERE GROWING AT 3%.
IT'S NOW MOVED TOWARDS 2%.
THAT'S NOT A RECESSION.
RECESSION IS LESS THAN ZERO.
IT IS SLOW GROWTH, SLOWER GROWTH
THAN THE ECONOMY DESERVES.
THERE'S OBVIOUSLY A LOT OF
CONCERN ABOUT THE TRADE WAR WITH
CHINA AND WITH TARIFFS.
TARIFFS ARE A TAX ON THE
AMERICAN CONSUMER AND THEY HURT
THE ECONOMY AND THEY TELL EVERY
PRODUCER, WELL, YOU DON'T KNOW
WHETHER TO INVEST TODAY OR NOT
BECAUSE YOU DON'T KNOW WHAT
PRICES WILL BE AND YOU DON'T
KNOW WHAT'S HAPPENING BECAUSE OF
ALL OF THE UNCERTAINTY.
THAT'S WHAT'S SPOOKING BUSINESS
INVESTMENT.
AS SOON AS THAT GETS SETTLED, WE
COME TO SOME AGREEMENT WITH
CHINA AND HOPEFULLY WITH THE
EUROPEANS, THAT I THINK YOU'LL
SEE THE ECONOMY TAKE OFF BECAUSE
THE FUNDAMENTALS ARE QUITE
STRONG BUT WHY NOT TAKE
ADVANTAGE OF THE LEFT CLAIMING
THAT THE ECONOMY'S SLOWING TO
PLAY THE CARD OF INDEXING
CAPITAL GAINS SO WE NO LONGER
TAX INFLATION.
I SAY LET'S TAKE THOSE MARBLES
OFF THE TABLE AND THANK THE
DEMOCRATS FOR THE HYSTERICS
ABOUT HOW WELL THE ECONOMY'S
DOING.
>> GROVER, IT'S VERONICA FROM
WALL STREET JOURNAL.
IF YOU DO THESE MOVES NOW,
THOUGH, DOES THIS LEAVE YOU WITH
A LACK OF FIRE POWER WHEN THINGS
ARE ACTUALLY REALLY BAD?
YOU NEED THEM.
>> WELL, YOU CAN ALWAYS DO MORE
TAX CUTS IN THE FUTURE.
YOU COULD ALWAYS WORK WITH THE
FED TO DO A BETTER JOB.
I WOULD START NOW BECAUSE IT
TAKES A WHILE FOR PEOPLE TO SELL
A $50 MILLION BUILDING IN
CHICAGO.
THAT P DOESN'T HAPPEN IN TWO
MONTHS.
BUT I THINK YOU'LL SEE PEOPLE
MOVE VERY QUICKLY TO SELL OLDER
ASSETS AND MOVE THEM TO HIGHER
AND BETTER USE.
SO I WOULD DO THIS NOW AND GOING
FORWARD THE NEXT TIME THERE'S A
TAX CUT, WE NEED TO MAKE SURE
THAT THIS CHANGE BECOMES
PERMANENT AND IN LAW, NOT JUST
REGULATORY.
WHAT WILL SPEED UP ALL OF THIS
ACTION IS THE DEMOCRATS WILL
ANNOUNCE WHEN I'M PRESIDENT I'LL
TAKE IT ALL AWAY.
SO EVERYONE PLANNING ON SELLING
IN THE NEXT 30 YEARS SELLS IN
THE NEXT YEAR.