No new taxes, cut entitlements: Norquist

Norquist: Taxes slow down economic growth

Republicans should not give President Barack Obama any new taxes as part of a long-term solution to solve the nation's budget problems, antitax crusader Grover Norquist told CNBC on Thursday.

"Taxes are too high. Taxes slow down economic growth. Economic growth right now sucks. You don't hit it again with new taxes," the GOP operative said in a "Squawk Box" interview. "We need long-term reductions in the unfunded liabilities on entitlements."

Early Thursday, the president signed a compromise bill to avoid the immediate crisis of a U.S. debt default and to reopen the government following the first shutdown in 17 years. The agreement allowed for the debt ceiling authority to be extended until Feb. 7, while approving federal spending until Jan. 15.

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Now comes the hard work of trying to craft a "grand bargain" or even a small deal to address government spending levels, the spiraling debt, and the underfunded entitlement programs.

"Taxes are not on the table," Norquist said, although he added that Republicans do support looking at closing tax deductions and credits, but it has to be revenue neutral. Tax reform can't be a "Trojan horse for tax increases," the founder of the Americans for Tax Reform said.

The Republicans want the president's sequester spending cuts maintained, he continued. "They are not going to allow more spending. The president wants a tax increase in order to spend more money."

Appearing on "Squawk" with Norquist, Mark Patterson, who was chief of staff at Treasury under Tim Geithner, explained the position of Democrats. "The president has shown a lot of flexibility on the spending side; been willing to do some things that are unpopular in his party."

"But revenues do have to be part of the picture," he continued. "We still are collecting a relatively small share of revenues as a share of GDP. We have a lot of needs."

Norquist said Republicans should not budge on the tax issue but should lead the charge to craft "long-term reductions in the unfunded liabilities on entitlements."

"The president and the Democrats want more spending. They think the sequester is stifling their spending they want. We can give them some spending today for significant reform in the future," he conceded.

By CNBC's Matthew J. Belvedere. Follow him on Twitter @Matt_SquawkCNBC.