Politics

Trump advisor Hassett: Warren and Ocasio-Cortez's tax proposals targeting the wealthy are 'economically illiterate'

Key Points
  • Democratic proposals like those from Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez targeting the wealthy don't make sense, Kevin Hassett says.
  • "I see the Democrats pursue really economically illiterate proposals just because they think they sound good politically," says the White House advisor.
The Democrats need an economic explainer, says Trump economic advisor Kevin Hassett
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The Democrats need an economic explainer, says Trump economic advisor Kevin Hassett

Democratic proposals like those from Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez targeting the wealthy are "economically illiterate," a top economic advisor to President Donald Trump told CNBC on Monday.

Warren, who is exploring a 2020 Democratic run for president, is proposing an additional 2 percent tax every year on households with assets over $50 million and 3 percent on households with assets over $1 billion. Ocasio-Cortez from New York wants a 70 percent marginal tax rate on income above $10 million.

Since those proposals, Senate Minority Leader Chuck Schumer and independent Sen. Bernie Sanders, have called on Congress to limit stock buybacks. They unveiled the proposal in a New York Times op-ed published Sunday.

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"I wish some economist would go and talk to these guys on how buybacks work," Kevin Hassett, chairman of the president's Council of Economic Advisors, said on "Squawk Box." "It's very disappointing that over and over again I see the Democrats pursue really economically illiterate proposals just because they think they sound good politically."

Democrats should be "ashamed," added Hassett, a former economist at the American Enterprise Institute and ex-senior economist at the Federal Reserve.

Democrats such as Ocasio-Cortez see their proposals as pushing the wealthy to pay their "fair share of taxes." The elite financiers that attended the World Economic Forum last month were worried about Ocasio-Cortez's 70 percent tax rate and Republicans were skeptical whether a proposal would actually work.

Hassett appeared on CNBC after the release of the better-than-expected jobs report for the month of January. Job growth for the month shattered expectations, with nonfarm payrolls surging by 304,000 despite a government shutdown.

He said he got a "fist bump" from the president on the jobs report and the direction of the economy.