Former Reagan Economist- Bad Policies To Blame For Failing Economy

Former Reagan economist Art Laffer expressed on Fox Business Monday that the rising unemployment rate is a result of “bad policies,” emphasizing that former President Donald Trump’s economic plan could reignite growth.

Following the Federal Reserve’s announcement to lower its federal funds rate by 0.50%, Fed Chairman Jerome Powell cited factors like “influx across the borders” as contributors to the increasing unemployment rate. On “Kudlow,” Laffer challenged Powell’s assertion, arguing that if illegal immigration were responsible for rising unemployment, employment should also have increased due to the influx of workers.

"I would like to see them get [the tax rate] down as far as possible, that's really the kicker for economic growth." —Art Laffer pic.twitter.com/TgWhu84h4o

— FOX Business (@FoxBusiness) September 25, 2017

“Not really, he’s [Powell] logically inconsistent, Larry. I mean, if unemployment went up because of illegal immigrants coming in, wouldn’t employment have gone up as well?” Laffer stated. “But when you look at employment growth, it’s been declining dramatically, and that’s really the problem.”

Laffer continued, “The unemployment rate increases because of bad policies, not because of illegal immigrants. Their tax policies, their spending policies, have led to a decline in the rate of growth of the economy and lessened employment. And that’s really a serious problem.”

He pointed to Trump’s economic policies, such as eliminating taxes on tips and overtime, as beneficial for job creation. “Can you imagine how many more service employees you’d find if you didn’t get taxes on tips? Or how much more we’d get if we didn’t have taxes on overtime work?” he asked.

Laffer also praised the Tax Cuts and Jobs Act’s $10,000 cap on state and local tax deductions (SALT), which Trump pushed for. “If you got rid of that, it would increase the after-tax rate of return for upper-income workers and lead to an increase in jobs, output, employment, and income,” he noted.

According to Bureau of Labor Statistics data, the unemployment rate in August fell for the first time since March, hitting 4.2% with 142,000 nonfarm payroll jobs added. However, this fell short of economists’ expectations of 161,000 jobs.

A recent ABC News/Ipsos poll shows Trump leading Harris by 7 points on who Americans trust more to handle the economy and by 10 points on immigration, while Harris leads by 9 points on health care and 14 points on abortion. The two are evenly matched on crime and safety.