Treasury Secretary Henry Paulson was on Larry Kudlow’s CNBC program last night, and Kudlow has provided a summary/semi-transcript of the secretary’s responses on his blog. You can get to Paulson video clips here.
Interesting response from Paulson to Kudlow’s question about Robert Rubin’s comments denigrating the value of capital gains cuts (that’s how Kudlow characterized it, anyway):
Well, let me say to begin with, like just about everyone else, I have a very high regard for Bob Rubin. So I’ll start there. But again, the way we are looking at it is—and I would be very surprised if Bob Rubin doesn’t agree with this—that we are in a world that’s continually changing. And it’s increasingly easy for someone to start up a business and operate from many parts of the world.
So we need to continue to say, `What tax system is going to let us be competitive with the rest of the world? Which tax system is going to let us—for any given amount of revenue raised—add more jobs, and pay higher wages?’
Now, my own view is investment is key to jobs, and is key to innovation, and is key to R & D. And productivity is key to higher wages. And the way you get greater productivity is with more investment, and I think the way you get more investment is tax it less.
Very glad to see Treasury focusing on global competitiveness. Indeed, on Monday the Treasury released a background paper, Business Taxation and Global Competitiveness (links), in anticipation of Thursday’s conference on the same topic. More on that as it develops.
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