WHEN: Today, Wednesday, October 25, 2017
WHERE: CNBC's "Closing Bell"
Following is the unofficial transcript of a CNBC EXCLUSIVE interview with United States Secretary Of Commerce Wilbur Ross on CNBC's "Closing Bell" (M-F, 3PM-5PM ET) today, Wednesday, October 25th.
All references must be sourced to CNBC.
BECKY QUICK: WE ARE JOINED BY THE 39thCOMMERCE SECRETARY WILBUR ROSS WHO IS WITH US TODAY. AND MR. SECRETARY, THANKS FOR BEING HERE.
WILBUR ROSS: GOOD TO BE ON.
QUICK: I WAS HOPING WE COULD START TALKING ABOUT TAX REFORM AND THE TAX PLAN BECAUSE THAT SEEMS TO BE WHAT THE MARKET HAS BEEN FOLLOWING ON A DAY BY DAY BASIS. OBVIOUSLY THIS IS RELATIVE VOLATILITY. YESTERDAY, BIG UP DAY. TODAY, A DOWN DAY OFF THE LOWS. BUT THE MARKET STARTED TO TURN DOWN AFTER COMMENTS FROM KEVIN BRADY, HOUSE WAYS AND MEANS COMMITTEE, SAYING THAT THE 401K IDEA IS ON THE TABLE. NOT WHAT THE PRESIDENT HAD TWEETED EARLIER THIS WEEK. AND I THINK THAT SHOWS YOU A LITTLE BIT ABOUT HOW DIFFICULT IT IS TO FIND THE PAY FORS WITH THIS. WHAT IS HAPPENING WITH TAX REFORM RIGHT NOW?
ROSS: WELL, THE PRESIDENT DOES NOT WANT TO INTERFERE WITH PEOPLES' RETIREMENT SAVINGS. PERIOD. HE ALSO WANTS TAX CUTS, ESPECIALLY MIDDLE CLASS TAX CUTS AND TAX CUT FOR BUSINESSES. THOSE ARE HIS BIG OBJECTIVES. AND THAT IS WHAT IS IMPORTANT TO ACHIEVE.
QUICK: IS IT POSSIBLE TO DO THAT? BECAUSE IT'S EASY TO TALK ABOUT LOWERING RATES, IT'S A LOT MORE COMPLICATED TO TRY AND FIND WAYS TO PAY FOR IT. AS WE'RE LEARNING WHEN YOU HEAR ABOUT THE STATE AND LOCAL TAX DEDUCTIONS, WHEN YOU HEAR ABOUT MORTGAGE INTERESTS AND WHEN YOU HEAR ABOUT THINGS LIKE THE 401K PACKAGE. WHAT DO WE TAKE BACK TO MAKE SURE WE CAN PAY FOR RATES BEING LOWERED?
ROSS: THE REAL WAY TO PAY FOR THE TAX CUTS IS BY STIMULATING THE ECONOMY AND GENERATING MORE TAX REVENUE. IF WE CAN GET THE ECONOMY UP 1% A YEAR MORE THAN WHERE IT OTHERWISE WOULD HAVE BEEN, THAT GENERATES TWO AND A HALF TRILLION DOLLARS OVER TEN YEARS. SO THE REAL DEBATE IS OVER THE TECHNICALITIES, HOW MUCH GROWTH WILL YOU REALLY GET FROM THE TAX CUT?
QUICK: YOU'RE TALKING ABOUT DYNAMIC SCORING. AND WHILE MOST PEOPLE WILL SAY YES, THERE IS SOME CERTAIN AMOUNT OF GROWTH TO THE ECONOMY THAT WILL COME FROM TAX CUTS, RIGHT? THE REAL QUESTION IS WHERE THE RUBBER HITS THE ROAD – HOW MUCH YOU CAN GIVE INTO THAT – YOU HAVE PEOPLE LIKE SENATOR BOB CORKER WHO HAVE SAID HE WILL NOT VOTE FOR A TAX BILL THAT ADDS A DIME TO THE DEFICIT. AND THAT'S WHERE YOU GET INTO SOME OF THESE REAL ISSUES FOR THE PAY FORS. DO YOU HAVE ENOUGH REPUBLICAN VOTES WITH DYNAMIC SCORING TO BE ABLE TO PULL THIS OFF?
ROSS: WELL, I THINK WE DO AND I THINK WE GOT A VERY GOOD ADVANCE HINT OF THAT WITH THE HOUSE GOING ALONG WITH THE BUDGET PROPOSAL. THE EXTREME RIGHT WING IN THE HOUSE HAD PLANNED 12 AMENDMENTS TO THE BUDGET. AT THE PRESIDENT'S URGING, THEY DECIDED NOT TO PURSUE THEM. JUST TAKE IT THE WAY IT WAS. THAT'S A VERY POWERFUL THING BECAUSE IT SAVES US ABOUT TEN DAYS OF DEBATE AND MORE IMPORTANTLY, THE REASON THEY WOULD DO THAT IS TO GET TO THE TAX BILL. SO I'M VERY OPTIMISTIC THAT THIS WILL BE MUCH BETTER RECEIVED THAN THE HEALTH CARE PROBE.
QUICK: YOU DO THINK THAT THE VOTES ARE THERE AND IT COULD POTENTIALLY HAPPEN BY THE END OF THE YEAR?
ROSS: I THINK THE VOTES WILL BE THERE. THERE WILL BE LITTLE COMPROMISES ALONG THE WAY. THERE'S SOME DISCUSSION BY SOME OF THE MEMBERS ABOUT HAVING SOME PORTION OF STATE AND LOCAL TAXES, DEDUCTIBLE, MAYBE FOR THE LOWER INCOME BRACKET. THERE IS SOME DISCUSSION ABOUT ADDING A FOURTH BRACKET. THERE WILL BE BELLS AND WHISTLES THAT WILL CHANGE, BUT I BELIEVE, DIRECTIONALLY, THE PRESIDENT WILL GET WHAT HE'S ASKING FOR.
QUICK: THE BILL – WE HAVE NOT SEEN THE SPECIFICS YET. WE EXPECT TO GET A BILL – DO YOU THINK THAT WILL HAPPEN NEXT WEEK?
ROSS: IT'S HARD TO PUT AN EXACT TIME DENOMINATION ON IT BECAUSE CONGRESS IS SO PROCESS-DRIVEN RATHER THAN RESULTS DRIVEN. BUT IT'S CERTAINLY GOING TO BE VERY SOON. AND IF IT'S NOT NEXT WEEK, IT'LL BE VERY QUICKLY THEREAFTER.
QUICK: SECRETARY ROSS, ONE OF THE HUGE ISSUES THAT WE'VE HEARD ABOUT FROM BUSINESSES ARE CONCERNS ABOUT WHAT WILL HAPPEN TO TRADE PACTS, SPECIFICALLY NAFTA. THERE'S BEEN A LOT OF TOUGH TALK FROM THE ADMINISTRATION. WHERE DO THE NAFTA TALKS STAND AT THIS POINT AND DO YOU EXPECT TO SEE IT RENEWED?
ROSS: WELL, WHERE THEY LITERALLY STAND IS THEY'RE RECESSED FOR ANOTHER COUPLE OF WEEKS, BUT SUBSTANTIVELY, WE'VE NOW GOTTEN THROUGH MOST OF THE FAIRLY EASY ISSUES. WE'RE NOW INTO THE HARDER ISSUES. AND I THINK WHAT'S UNFORTUNATE IS PEOPLE TRYING TO PREJUDGE WHAT MAY BE THE OUTCOMES. WHAT THEY OUGHT TO DO, LET'S GET A DEAL IF WE CAN GET ONE. IF THEY DONT LIKE THE DEAL, LET'S TALK ABOUT THAT. BUT I THINK IT'S A LITTLE SILLY TO HALLUCINATE ABOUT THIS MAY HAPPEN, THAT MAY HAPPEN. THEY DONT HAVE ANY IDEA WHETHER THEY'RE GOING TO HAVE A DEAL OR NOT.
QUICK: ARE YOU OPTIMISTIC ABOUT THE IDEA THAT WE WOULD HAVE A DEAL?
ROSS: I THINK THERE WILL BE A PROPOSAL THAT WE CAN TAKE TO THE PRESIDENT. WHETHER IT WILL BE A PROPOSAL THAT WE WILL RECOMMEND AND WHETHER IT'LL BE A PROPOSAL THAT HE WILL ACCEPT ARE DIFFERENT STORIES. BUT WE'RE TRYING TO DO A DIFFICULT THING. WE'RE ASKING TWO COUNTRIES TO GIVE UP SOME PRIVILEGES THAT THEY HAVE ENJOYED FOR 22 YEARS. AND WE ARE NOT IN A POSITION TO OFFER ANYTHING IN RETURN. SO THAT'S A TOUGH SELL AND I DONT KNOW THAT WELL GET EVERY SINGLE THING WE WANT. QUESTION IS WILL WE GET ENOUGH TO MAKE IT WORTHWHILE.
QUICK: MR. SECRETARY, I WANT TO THANK YOU VERY MUCH FOR YOUR TIME.
ROSS: THANK YOU, BECKY, GOOD TO BE ON WITH YOU.
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