Thursday, June 14, 2007

Hubbard Says No New Taxes

Senior White House economic advisor Al Hubbard threw cold water over any and all tax hikes in our interview on Kudlow & Company last night.

Hubbard made it crystal clear that President Bush would pull out his veto pen on any tax hike proposals coming across his desk.

He said, “The one thing you know about this president, Larry, is he’s a tax cutter, not a tax raiser. This president's never going to support an increase in taxes.”

This includes former Clinton Treasury secretary Robert Rubin’s tax on private equity and hedge fund managers that would more than double the capital gains tax for them. Rubin by the way, is itching for a hike in the cap gains rate for everybody, telling a conference in Washington earlier this week that Bush’s capital gains tax cut hasn’t contributed “one iota” to the economy.

Hubbard also made it clear that the president would veto the Democratic House’s proposal to levy a 4.3 percent surtax on high-income earners, allegedly designed to solve the AMT problem. (The definition of “high-income” remains ambiguous—some in Congress say it could be $500,000, while others say it could hit earners making $75,000.)

Hubbard said he “absolutely” disagrees with Rubin’s tax hike proposals and added that the president was “totally opposed” to raising taxes.

He made it clear that the top priority should be to extend and maintain the Bush tax cuts which have stimulated the economy, created over 8 million jobs, raised stock market asset values, and launched a revenue avalanche of tax collections as the budget deficit continues to evaporate.