Trump budget director Mick Mulvaney admitted to CNBC that he’s not really concerned about the impact of tax cuts on the budget deficit:
“Bad spending, to me, in terms of its economic benefit, would be wealth-transfer payments. It’s a misallocation of resources. Infrastructure is sort of that good spending in the middle, where even if you do misallocate resources a little bit, you still have something to show for it. It’s tangible, it may help economic growth, and so forth. At the other end of the spectrum, at the very other end, is letting people keep more of their money, which — while it can contribute to the deficit in a large fashion — is the most efficient way to actually allocate resources. It’s a little less important to me if infrastructure adds to the deficit. And I’m really not interested in how tax reform handles the deficit.”
Jonathan Chait: “What makes Mulvaney’s comments so unusual is not only their frankness, but also their comprehensiveness. Republican politicians tend to segregate their discussion of taxes and spending, so that they can frame their opposition to transfer payments as concern about deficits, while framing their desire of regressive tax cuts as being unrelated to deficits. Mulvaney, who is known in Washington as a budget hawk’s budget hawk, is essentially conceding that deficits have nothing to do with the Republican fiscal agenda.”
