Kevin Hassett, the chairman of the Council of Economic Advisers, says a tax cut like the one President Trump is proposing could potentially lift wages by about $4,000.
Hassett spoke at The Hill‘s event on tax reform at the Newseum in Washington, D.C., on Wednesday and said wages have been stagnant for too long and the president’s framework for tax reform would help Americans earn higher wages.
“Over the last eight years the average real income growth was only about 0.6 percent per year,” Hassett said. “That’s just not fast enough. If you have the sense that America’s workers aren’t keeping up, it’s because they haven’t been.”
“What President Trump wants the team to do is come up with a plan that fixes that, and we know that profit growth over that same time is almost 11 percent per year. And so it used to be that profit growth went up 11 percent, then we’d expect wages to go up 11 percent, but instead profit growth went up 11 percent and wages hardly budged.”