Art Laffer: The Foundation Is Now Laid For An Economic "Golden Age"

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**Arthur Laffer** (1:00)
I do imagine we could have growth rates of four or five percent for a period of time there. I do think that Scott Besson is correct. I think he's trying to be cautious. I think he's holding back on what he may actually believe, but he's not an economist like Adam, so I can talk to you. I would not be surprised if we had growth rates of four percent, five percent in the next three years, some periods of that time happening. And that would change the whole story. That will change the whole story of what happens to revenues, that will change the whole story of what happens to welfare. You know, with that type of growth, we'll get lower unemployment, we'll get more people employed. All of that stuff will happen there. I am very optimistic that the economy is in for a new era of prosperity.

**Adam Taggart** (1:46)
Welcome to Thoughtful Money. I'm its founder and your host, Adam Taggart. Well, now that President Trump has set into motion the main pillars of his economic policy, trade reform, tax cuts, and deregulation, what should we expect from here? And I can think of few better people to hear from on this topic than today's guest, who's one of the key economic advisors to President Trump and his cabinet members. Today, we're fortunate to welcome back to the program Dr. Arthur Laffer. He was the first to hold the title of Chief Economist at the Office of Management and Budget in the early 70s. He then later served as a member of President Reagan's Economic Policy Advisory Board. He's perhaps best known for developing the Laffer Curve, a model for determining the optimal balance between tax revenues and economic growth. Dr. Laffer, thanks so much for joining us today.

**Arthur Laffer** (2:33)
Key economic advisor, I love that phrase. Can I just credit? I mean, I have some inputs, but I don't think I'm like, well, never mind. But it's really fun.

**Adam Taggart** (2:44)
I don't know. I think you should maybe get a tattoo of that. Look, you're being modest because I was just listening to just a few weeks ago, Treasury Secretary Scott Besson. He was testifying before Congress. I believe they were grilling him on the one big beautiful bill, and they asked, which economists are behind this bill, and you were the first name out of Secretary Besson's mouth. So you clearly have made a big impression on him.

**Arthur Laffer** (3:11)
Thank you very much. All right.

**Adam Taggart** (3:14)
Well, look, so much has happened since the last time you and I talked, Dr. Laffer. President Trump had been elected, but he actually hadn't stepped into office yet. You were very excited where he might take things. Now that we are, what, 150 days or so into this administration, which has moved with lightning speed, what kind of grade do you give their economic deployment so far?

**Arthur Laffer** (3:37)
Well, I don't know if I want to give a grade, but he got the agendas and it's in place. I mean, when you look at this BBB, and forgive me for calling it that, but everyone else does.

**Adam Taggart** (3:47)
That's fine.

**Arthur Laffer** (3:48)
That big, beautiful bill, that was essential to really going to the next stage. In that bill, the Tax Cuts and Jobs Act was made permanent almost, and that is really important. Not so much because it lowers taxes, it doesn't. It keeps tax rates from rising. You know, the 37% personal income tax now will be there. That's permanent. It doesn't pop back up to 39.6. The depreciation schedules now are expensing levels, which they were going to pop up to 20 years. Depreciation schedules some of the years back, all of that. Likewise, you're going to get the death tax is not going to go up dramatically, which is, these are all very big pluses. The corporate tax was already permanent, the 21%. So that didn't change that. In the BBB, he also got all of his big legislative agendas. He had all the departments and agencies bills that often are done by defense budget, and each one separately. He plopped them all into one thing. So he has his border security, has his defense budget. He has all this other stuff in there that he wants in there. He has school choice, etc.