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Title: Stephen Moore: 3.8 Percent Growth Report Is a BIG Deal for America!

Title: Stephen Moore: 3.8 Percent Growth Report Is a BIG Deal for America! Read Transcript

Well, with us right now from Washington is Stephen Moore.

He's an economist with FreedomWorks,

and he's an adviser to the Trump campaign.

Stephen, welcome back.

Hey, it's good news, I think, that those folks

are working together.

They've actually got a framework of a plan right now.

You got it, Pat.

And by the way, let me step back a minute.

Because that report we just heard was so important.

3.8% growth, Pat, in the third quarter.

Now, we're about seven weeks-- we're a little over halfway

through the third quarter.

So this is a preliminary estimate.

But 3.8%-- I mean, my goodness, if Barack Obama were

at 3.8% growth, he would have done

cartwheels down Pennsylvania Avenue.

I mean, this is an incredible number, especially given

that the economy was only growing at about 1 and 1/2%

in Barack Obama's last year in office.

What I'm saying, Pat, is the economy has ramped up big time.

It has shifted into a faster gear because of Donald Trump's


When I talk to him, we always talked about two things

to really improve the economy.

And it's very Reagan-esque.

Get tax rates down, and get regulations off

of the back of business.

The second half of that, he is doing big time right now, Pat.

There was a new study that came out by my friends

at the Competitive Enterprise Institute that

finds that the number of new regulations

has come to a screeching halt. And those regulations

impede business.

They impede higher wages for workers.

And they impede hiring more workers.

So this is a big deal.

Did you know, Pat, for every new regulation

under Donald Trump, 16 regulations have been repealed?

So this is a pro-growth president.

But you asked the right question.

How are the Republicans going to get this tax cut done?

Because I think that's the missing piece

of the equation right now.

Well, Steve, let's look at some of the elements of that.

As I understand, they're really going to stick it

to these high tax states.

If they take away the deduction for state taxes,

that's going to be a body blow to California

and New York and these high tax states.

I mean, the Democrats' strongholds--

they're going to scream like wounded eagles on that one.

How are the Republicans going to get through that?

Yeah, well, Chuck Schumer is not a happy camper right now

from New York.

That's for sure.

But this is the most unfair tax deduction in the tax code.

Because, you know, there are nine states right now,

Pat, that have no income tax at all-- states like Tennessee

and Texas and Florida and New Hampshire and Nevada.

And I could name all of them.

Those states, they don't get the write-off for their taxes.

But those high tax states that you mentioned, like New York

and California, my home state of Illinois, Connecticut, New


they get these big write-offs.

And by the way, I just got back from vacation.

I was in California.

One of the most beautiful places on this planet is California.

And it's amazing how liberals have

destroyed that state, because it is such an amazing place.

But California, do you know what their highest income tax rate

is today in California?

Just take a wild guess, Pat.

I don't know, 15%?

13 and 1/2.

13 and 1/2%.

13 and 1/2%?


So you can live in California and pay 13 and 1/2%,

or you can move to Nashville, Tennessee, and pay zero.

So if you want to see the effect of lower taxes,

look at the migration that is happening in this country out

of those high tax states like Illinois and Connecticut

and New Jersey and New York to the states like Texas

and Florida.

I was in Florida, also, a couple of weeks ago,

and all I saw was people with California license plates

who said, I'm out of here.

I can't afford to live in California anymore.

So I do think we ought to get rid

of that deductibility of the state and local taxes.

There's another one they're talking

about putting on the table, which is a sort of darling

of the housing lobby, that they'd take away

the deduction for mortgage interest.

How's that going to work?

Well, let me explain that.

Because the way that we devised this plan--

and I think what they will come up

with will be very similar to what we came up

with during the campaign-- is that if you have less

than, say, a million dollars of income,

you'll still get your housing deduction.

But why should you be able to deduct the value of your home

if you buy an $8 billion castle or something like that?

The idea is to encourage home ownership.

We shouldn't be subsidizing these massive houses

for very wealthy people.

And so get rid of that.

So the idea here, just so your viewers understand,

Pat, is a very simple concept that Reagan

did very effectively '80s.

Get rid of all these loopholes.

Get rid of as many of the write-offs as you possibly can.

But then cut the tax rates for everybody.

So everybody is paying less.

By the way, by getting rid of those loopholes,

you make the tax system much fairer.

Because everybody's going to pay their fair share

if they don't have these special interest

carve-outs and deductions and loopholes.

In the tax code right now, you would

be so surprised at the absurdity of some of these deductions.

It's an 80,000 page tax code.

Can you believe that that, Pat--

80,000 pages of regulations and loopholes?

You can get write-offs for windmills, bull sperm,

all the racetracks, all of these things--

just get rid of it and make it simple.

I love the idea, Pat, of the postcard tax

return, where you can literally fill out

your taxes in 10 minutes.

All right.

It's got to go through Congress.

So what's the deal?

I mean, I've had on this program the chairman of the House Ways

and Means Committee.

Great guy.

He's a brilliant guy-- a terrific guy.

And his plan is so simple.

Will the Republicans in the Senate

go along with this, do you think?

They better.

I've kind of hesitated to make any more predictions, Pat.

Because I think on this show a few months ago,

I almost guaranteed you the Republicans were going

to get Obamacare repealed.

And they didn't get that done.

So I'm almost embarrassed by that prediction.

Look, Republicans-- if they get through this year with

a Republican House, a Republican Senate,

a Republican president--

I heard you last night talking about 2/3 of the governors

are now Republicans, 2/3 of the state legislatures.

If the Republicans can't get this done, shame on them.

Shame on them.

But you run into the same problem we

ran into on health care, Pat.

There there's only 52 Republicans in the Senate--

only 52.

And the Democrats are in a resistance mode.

They are against anything that Trump is for.

I've never seen anything quite like

it-- the fierce partisanship of Democrats.

Even things that are good for the country, Pat, Democrats

will not vote for if Trump is for it.

So that means you got to get 50 out of 52.

And that's a heavy lift, I've got to say.

And Donald Trump called out John McCain in his speech

last night in Arizona and said, get your Arizona senator

to vote for this program so we can get it through.

What's the effect this is going to do, though?

Let's assume we lower the rate for everybody.

If the GDP is already 3.8%, what's

the number this can go to?

Are we talking about 6% or 7% growth?

Well, you know, it's funny you should ask that.

I was looking back at some of the growth rates

we had under Ronald Reagan, when he did his famous tax cut.

And by the way, I've just got to tell your viewers--

I had such a thrill last week.

I spoke at the Reagan ranch out in Santa Barbara last week.

I don't know if you've been out there, Pat,

but it's an amazing place to be.

And that's where Ronald Reagan signed his historic 1981 tax

cut in August of 1981.

Well in any case, what we saw in the aftermath of that tax cut,

we actually had quarters of growth-- you can look it up,

folks, if you don't believe me--

of 7% and 8%.

Now, could we do it again today?

That might be a little shooting for the moon.

But I do think we can get 3% to 4% to 5% growth.

And that's going to feel a lot better for Americans

compared to the 1 and 1/2% to 2% growth

we had under Barack Obama.

So you do that regulatory relief, you do the tax cut,

and you do the pro-America energy policies that

we've talked a lot about on this show--

yeah, I'm one of those people who

think we can get 3% to 4% growth for a sustained period of time.

And if you do that, the debt is going to come down,

the deficit is going to come down.

We're going to have more jobs, higher wages.

It's better for everyone.

I am so disgusted-- and I have to say, Pat--

I'm truly disgusted with the national media

today that isn't covering this story

about the potential-- number one, what's

happening with the economy, and how

it's gotten better, and second of all,

how this tax cut could really improve the lives of Americans.

We have an incredibly uncompetitive tax system

right now.

We have the highest tax rates in the world on our businesses.

We see week after week American businesses

moving to Ireland or Canada or China or Mexico.

Let's bring them back, Pat.

Let's bring those companies back to America

s they are creating jobs in Michigan and Ohio

and Pennsylvania, not in Beijing and Mexico City.

The Democrats are going to demagogue this.

It's unbelievable how they're doing it.

But they'll say, these are, quote, tax cuts for the rich.

For the rich.

It's an absolute lie.

It's no such thing.

It's the tax cut for everybody.

And everybody is going to benefit.

The whole economy is going to benefit.

It's a question of intestinal fortitude.

Do the Republicans have it?

Mitch McConnell is a pretty sharp guy.

Can't he drive that thing through?

He's got to.

I mean, really.

There's no room for failure here.

I would just urge everyone watching the show,

put some pressure on your United States

senator and your congressman.

Get this thing done.

It's going to be good for America.

It worked for Reagan.

And by the way, it didn't just work for Reagan.

It worked for a Democrat, Pat--

John F. Kennedy, who also promoted a tax

cut and created a great prosperity in this country.

Look, the people who are hurting the most in this country today

are people at the bottom of the ladder, who don't have

the economic opportunities, don't have the availability

of the good paying jobs.

We will get those jobs back in America.

I was on the campaign trail this last year.

And I went to areas in the Midwest--

the Rust Belt states--

and in places like West Virginia.

And I saw places that just have had no recovery, Pat.

It was really a depressing thing to see.

The liberals act as if everything

was so wonderful under Obama.

No, there were whole areas of the country that did not

feel any kind of recovery.

Trump is so dedicated to bringing jobs back

to those areas-- to those kind of middle class

blue collar workers, where factories

were lost, where steel plants were closed,

where coal mines were closed.

We've got to get those people back

in the jobs where the belong.

The best way to increase the revenues, Pat, is

to get people a job so they're are actually paying taxes.

If he gets this tax cut through, and the economy goes,

he's got a lock on his second term.

And when he does it, he's going to lock

on about five new Supreme Court appointees.

He will change the court.

He will change the direction of this country.

And that's why the liberals hate what's being done.

They see down the road that if they

let him have any success here, that he will come back,

and the Republicans will have a lock on it.

But the Republicans should have sense enough

to realize that they can win this thing big time if they

just go for it.

Steve, I'm with you.

And thank you, buddy, for being here.

God bless you.

Thanks, Pat.

Have a great week.


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