Mnuchin: ‘The President Has Been Very Focused on the National Debt,’ ‘We Need Tax Cuts’

WALLACE: Are you insisting — because the president didn’t say this in his speech in Missouri this past week, are you still insisting that this will be revenue neutral, that it won’t add to the deficit? That if you lower rates, you’ll also take away some deductions or tax breaks to pay for it. Or could this just turn into tax cuts? And if so, given what you just heard from Governor Abbott about $100 billion, $150 billion, $180 billion in federal money need for Harvey, won’t this blow a hole in the deficit?

MNUCHIN: Well, Chris, the president has been very focused on the national debt and concern that it’s gone from $10 trillion to $20 trillion. That’s a big concern of ours. So, we want to make sure we can pay for things.

But the way we’re going to pay for things is with economic growth. The difference between 2 percent and 3 percent is trillions of dollars of revenue to the government. So, I think we may be in a situation where the administration believes we’ll get more economic growth than perhaps the models that come out of Congress. But we’ll be working with them on that. And I think now more than ever, it’s too early to tell what the economic impact of Harvey is.

But now more than ever, we need to make sure we pass tax reform, regulatory relief, and trade negotiation so we create a 3 percent or higher GDP in this country and rebuild what we need to rebuild.

WALLACE: Just to bottom that up though, sir, I — you’re certainly not indicating that this bill will be revenue neutral in terms of what money the Treasury loses in — through lower tax rates and what it gains from fewer deductions?

MNUCHIN: Well, again, what we’ve said is we believe in dynamic scoring and under our growth models at the Treasury, this will pay for itself. And again, we may not get full credit for that. There may be short-term impacts on the deficit, but we’re very — we want to be very careful in paying for this with growth.

But we also need to boost the economy. We need tax cuts and tax reform now.