Wild About Tax Cuts, Wall Street Forgets Its Deficit Worries

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Aug 24 2017

Max Abelson at Bloomberg Businessweek details how the titans of Wall Street and others in finance — think Goldman Sachs CEO Lloyd Blankfein, JPMorgan Chase’s Jamie Dimon, Bank of America’s Brian Moynihan and others — have turned their backs on debt and deficit concerns they once supported in their rush to champion tax reform.

Former Sen. Judd Gregg, a New Hampshire Republican who had been chair of the Senate Budget Committee and went on to lead the Securities Industry and Financial Markets Association, a Wall Street lobbying group, “says it wouldn’t be so terrible if slashing taxes added $1 trillion or $2 trillion to the $20 trillion the U.S. already owes,” Abelson reports. “The way he sees it, there should still be attention paid to the fiscal health of the U.S., ‘but concern in my opinion should be focused on entitlement reform.’”

Gregg is co-chair of the Fix the Debt campaign, but that group says it opposes tax cuts if they increase the deficit, Businessweek notes. (The Peter G. Peterson Foundation provides funding to the Committee for a Responsible Federal Budget. Fix the Debt is a project of the CRFB. The Fiscal Times is separately funded by Pete Peterson and is editorially independent.)

One notable exception to the Wall Street swing: “BlackRock Inc. CEO Larry Fink warned in April that the U.S. would have a ‘severe issue’ if Trump’s tax plan makes deficits worse.”

Still, Wall Streeters’ eagerness for tax cuts has some on the left crying hypocrisy while leaving other wonks simply frustrated. “They’re incapable of holding two thoughts,” Douglas Holtz-Eakin, the former CBO director who now heads the conservative American Action Forum complains to Abelson.

Read the full piece for more quotes like this, from one martini-toting investor: “Nobody put me on this Earth to pay for everybody’s health plan. I know that sounds like Scrooge or somebody. But this is the real world.”

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