Conveniently, since he remains a front runner (admittedly well behind Powell) to become the next Fed Chairman, John Taylor was able to inject a few soundbites into the media-sphere yesterday.
As Bloomberg reports, John Taylor, the Stanford professor who is among the finalists that President Donald Trump is considering to lead the Federal Reserve, argued Thursday that faster U. S. economic growth is possible if policy makers focus on reforms that encourage investment and hiring.
‘I would go back to the basic principles, that incentives matter, that tax rates matter, and apply those principles,’ Taylor told an audience at the University of Wisconsin in Madison.
‘You want to have the supply of the economy increasing more rapidly and you can do that with new policies.’
Talk about hitting the right notes… Taylor thinks he can solve the productivity conundrum, in part by cutting… regulation.
As Bloomberg continues, Taylor compared growth and productivity growth in the U. S. over the past decade to rates before the financial crisis, when they were substantially higher. He said tax reforms and efforts to roll back regulation could help bring back those higher levels of growth. He also made a specific reference to the post-crisis reforms of the 2010 Dodd-Frank Act, designed to make banks safer and limit risk-taking on Wall Street, which the Trump administration aims to roll back. ‘As you look back at that, maybe there’s too much micro-managing of financial institutions,’ he said.
The report suggests Trump would have lapped it up.
This post was published at Zero Hedge on Oct 27, 2017.
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