Wealth redistribution or growth—not both: Sam Zell

Zell: US economy is 'benign'

The United States needs to stop taking its "eye off the ball" on economic growth, in order to stamp out the uncertainty that's preventing investors and companies from taking risk to make money, billionaire real estate mogul Sam Zell told CNBC on Friday.

"Wealth redistribution" policies in Washington are hampering the economy, he said. "I find it difficult to believe that you can have wealth redistribution and growth at the same time."

Zell called out fellow "Squawk Box" guest James Bullard, president of the St. Louis Federal Reserve—arguing that the U.S. has accepted a level of growth that over the long term is a real problem. "I don't see any animal aspirations," Zell continued. "I think we need to refocus our efforts on growth."

Bullard responded by saying he too would like to see a stronger pickup in the economy, but monetary policy can't fix everything. "What kinds of policies would emphasize that? You need more innovation, more technology ... better education policies. I'm for all of those things, but monetary policy doesn't really directly affect those things."

Zell, the chairman of Equity Group Investments, disagreed—saying monetary policy does have an impact because it can affect the "levels of uncertainty," which influences risk tolerance. "That's really what growth is all about."

This debate played out Friday against the backdrop of a reduction in estimates for fourth-quarter gross domestic product, which was basically in-line with expectations. The government revised GDP expansion sharply lower to a 2.4 percent annual rate, compared with the 4.1 percent advance in the third quarter.

Bullard acknowledged that the economy has been weak since the 2008 financial crisis. And as a result, "It has not been as good a time for stable monetary policy in the last five years as I would like it to be. Hopefully we can get back to something ordinary and more predictable in the next five years."

Describing the U.S. economy as "benign," Zell said the Fed needs to stop making excuses for the weak growth. "'What happened in 2007 and 2008 and 2009 is still impacting us' is a little bit like blaming [George W. Bush] for everything that happened after he left office."

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