Renewing the Bush tax cuts for wealthy Americans would hurt, not help, them, because it impedes the U.S. economy, billionaire financier George Soros, head of the Soros Fund Management, told CNBC Monday.
“It’s so clear what’s needed,” said Soros. “But because of the political debate, which the administration has lost, we are going to follow the wrong policy by extending the Bush tax cuts, which will not get you employment.
“It will help the top 2 percent, to which I belong, but that is not even good for the top 2 percent, because we really need a prosperous economy.”
Added Soros: “It is tragic. It seems for the Republicans, it is more important to make their top contributors satisfied, so they get the tax cut, than to do what is in the interest of the public.”
Soros favors extending the tax cuts for the middle class. The top 2 percent of wealthy Americans are individuals who earn over $200,000 and families making more than $250,000.
Soros advocated a second stimulus in the United States in order to improve its competitiveness worldwide. He said the money should be invested in infrastructure and education.
Concerning the valuation of the yuan, Soros said that China’s currency stance has resulted in a dual monetary policy for the Asian behemoth in which it controls not just its own currency, but that of other nations.
“They [the Chinese] stopped buying the euro when it was at 1.60,” he said. “Then they stepped in when the euro was at 1.20 and it moved up to 1.40.
“They are now the dominant factor in deciding when the currencies of the other countries move. They put pressure on Japan and bought government bonds of Japan. Japan was very upset because they can’t buy the government bonds of China. It’s unequal.”