Trump will need more than a tax reform to increase GDP, former Biden adviser says

The idea of the Trump administration getting the economy back on track to 2 to 3 percent growth this year is "just fairy dust," a former Biden adviser told CNBC on Thursday

"It's really important to recognize [the Republicans] don't have a plan," Jared Bernstein said during an interview on CNBC's "Power Lunch." "History has very little correlation between changes in the tax code and [GDP]."

Earlier on Thursday, Treasury Secretary Steven Mnuchin said that he wants to see "very significant" tax reform passed before Congress' August recess. Tax reform has been a key pledge of President Donald Trump's to boost economic growth in the country. Congress is also working to introduce legislation next month to at least partially repeal the Affordable Care Act, or Obamacare.

Mnuchin thinks this reform should get the economy back on track. Not so fast, Bernstein said.

"It isn't happening," he said.

Bernstein said U.S. growth has been held back by lower productivity and slower labor force growth. A new tax policy or a repeal of Obamacare will not be the key to solving this country's problems, he added.

Sara Fagan, a former senior aide for George W. Bush, disagrees.

"In fairness, the president will have a plan very soon, as he's been working on this for a long time," Fagan said on CNBC's "Power Lunch."

Mnuchin has said the administration is "primarily focused on a middle-income tax cut and a simplification for business." The new Treasury secretary has indicated that should the wealthy get a tax cut, such a break would go hand in hand with the closing of loopholes that currently benefit the rich.

"The tax plan will be huge this year, and so is [repealing or replacing] Obamacare," she went on. "When you take this in totality, yes [Trump's administration] can achieve 3 percent growth, or perhaps higher."

Fagan said Trump is "actually getting things done," while many are used to "nothing being done in Washington."

Maybe, "somehow magically," the Trump administration can get its act together, Bernstein said.

—CNBC's Jacob Pramuk contributed to this report.