Glenn Hubbard, an economic adviser to Mitt Romney, clarified some of the details of Romney’s plan to improve the economy on Sunday, insisting that all options were on the table when it comes tax reform, but also asserting that such reform would have to focus on wealthier Americans.
Speaking on CNN’s Fareed Zakaria GPS, Hubbard said that Romney wants to get marginal tax rates to the same levels as proposed in the Bowles-Simpson deficit reduction plan, but to pay for such cuts, Romney has proposed broadening the tax base.
“The bulk of the adjustment [must] be borne by upper income households,” Hubbard said of Romney’s tax reform plan. “Everything has to be on the table, and again, the adjustment really has to focus on upper income households.”
On welfare reform, Hubbard said that Romney’s plan would also focus on the rich, as his proposed reforms would “limit Medicare support, particularly for more affluent seniors,” and Romney would “slow the rate of growth of [Social Security] benefits for upper-income people.”
This assertion may placate some critics concerned that Romney is inclined to favor the rich in his policy proposals. But Hubbard’s explanation of Romney’s long-term outlook on the deficit may irritate more fiscally conservative Republicans, particularly the tea party, which is notoriously averse to any national deficit whatsoever. Hubbard indicated that it’s “the very big deficits that the country should be afraid of,” whereas small deficits are alright.
“If we can get federal spending to 20 percent of GDP by 2016, the deficit will be very small. A healthy tax system and a healthy economy would produce 18 percent, 19 percent of GDP in revenue. So those won't be large deficits,” he said.
With a fierce debate over expiring tax cuts and pending budget sequesters looming, Hubbard said that the best option for Congress might be to kick the can down the road if Romney is elected. “If we get to a situation where Governor Romney becomes the president, then the lame-duck congress ought to simply shift things down the road a few months to the enactment of Governor Romney's tax plan,” he said.
“If the president wins re-election, that's a different negotiation," he said.