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AT&T CEO says a corporate tax cut would mean thousands more jobs for 'hard hat' workers

  • "Lower taxes drives more investment, drives more hiring, drives greater wages," Randall Stephenson says.
  • AT&T would have to add 7,000 jobs to execute on every $1 billion of capital investment, the CEO estimates.
  • Reducing business regulations is another way to get companies to invest, he argues.

With President Donald Trump and House GOP leaders looking to reduce the tax burden on corporate America, AT&T Chairman and CEO Randall Stephenson said Thursday lower taxes means the telecom giant would be willing to invest even more in the United States.

"Lower taxes drives more investment, drives more hiring, drives greater wages," Stephenson said on CNBC's "Squawk Box." "All of this fits together."

The tax reform blueprint from the White House calls for reducing the federal corporate rate to 15 percent from 35 percent. The plan spearheaded by House Ways and Means Committee Chairman Kevin Brady and House Speaker Paul Ryan aims to reduce the corporate tax rate to 20 percent. But the Brady-Ryan proposal includes a controversial pay-for provision in the form of a border adjustment import tax.

"If you can have a tax reduction of 35 percent down to, you pick your number, 25 or 20 percent — to think that wouldn't cause additional investment is nonsensical. I know exactly what AT&T would do: We would invest more," said Stephenson.

An AT&T advance-line technician parks his service truck as he prepares to troubleshoot an aerial cable in Des Plaines, Illinois.
Tim Boyle | Newsmakers
An AT&T advance-line technician parks his service truck as he prepares to troubleshoot an aerial cable in Des Plaines, Illinois.

For example, he said AT&T would have to add 7,000 jobs to execute on every $1 billion of capital investment. "There are jobs wearing hard hats … to put that capital into the ground or on cell towers," he said. "There are high-paying, really good jobs with great benefits. The correlation is tight — very, very tight."

The AT&T CEO said that reducing business regulations is another way to get companies to invest. Regulation is "effectively a tax on investment," he argued. "Take regulation down, you get investment up."

President Trump has also made deregulation a centerpiece of his economic policies — which include tax cuts, replacing Obamacare, and infrastructure spending — that he hopes will boost growth to 3 percent or even more.

The government on Friday reported the weakest pace of economic growth in three years in the first quarter. Gross domestic product increased at a 0.7 percent annual rate. The economy grew at a 2.1 percent pace in the fourth quarter.

A CNBC review of decades of GDP data shows first-quarter growth has been routinely understated.

The economy grew 1.6 percent for all of 2016, its worst performance since 2011, after expanding 2.6 percent in 2015.

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