National Economic Director Gary Cohn speaks at a news conference in which he discussed the tax reform plan of US President Donald J. Trump, in...
MICHAEL REYNOLDS

White House’s Cohn touts ‘trickle-down’ benefits in GOP tax plan

Gary Cohn, director of the National Economic Council in Donald Trump’s White House, sat down for a very interesting chat with CNBC’s John Harwood this week, and it looks like the president’s top economic adviser ended up saying a few things he probably didn’t intend to say.

As recently as late September, for example, Cohn argued that in the Republican tax plan, which he’s helped write, “Wealthy Americans are not getting a tax cut.” With Harwood, Cohn said something very different.

“When you take a corporate tax rate at 35 percent and move it to 20 percent, and you see what’s happened over the last two decades to businesses migrating out of the United States, migrating profits out of the United States, migrating domicile out of the United States, and hiring workers out of the United States, it’s hard for me to not imagine that they’re not going to bring businesses back to the United States.

“We create wage inflation, which means the workers get paid more; the workers have more disposable income, the workers spend more. And we see the whole trickle-down through the economy, and that’s good for the economy.”

It’s worth appreciating, just as a matter of political rhetoric, that there are certain phrases that the right has learned to avoid. Advocates of privatizing public education, for example, steer clear of the word “vouchers,” for example, because they’re not popular – so they use pleasant sounding euphemisms such as “school choice” instead.

Similarly, advocates of massive tax breaks for the wealthy and corporations tend to avoid references to “trickle-down” tax policies because most of the public is repulsed by the idea of giving more money to those at the very top and waiting for prosperity to eventually work its way to everyone else.

And yet, Cohn, perhaps inadvertently, said what he actually believed, confirming what critics of the Republican plan have been saying all along.

In the same CNBC interview, Cohn added, “It’s not our intention to give the wealthy a tax cut.” Harwood, familiar with reality, responded, “But they’re getting one.”

The White House adviser added, “I don’t believe that we’ve set out to create a tax cut for the wealthy.”

This might be one of the greatest quotes of the tax debate thus far. According to Gary Cohn, the Republican plan delivers massive tax benefits to millionaires and billionaires, but that’s not what he and the plan’s co-authors “set out” to do.

Congratulations, wealthy Americans, Republicans are poised to give you enormous amounts of money – by accident.

If I didn’t know better, I might think the proponents of the GOP tax plan are trying to make it less popular.

Tax Policy and Tax Reform

White House's Cohn touts 'trickle-down' benefits in GOP tax plan