Former U.S. Treasury Secretary Larry Summers gave his views on the state of the U.S. economy at the University of Delaware Tuesday night.
Inequality was a common theme of Summers’ UD talk.
Summers criticized the Republican tax plan Congress passed in 2017 as primarily benefiting the richest Americans. He said the economy didn’t really benefit from them - and they haven’t helped the U.S. prepare for a recession.
“So the two things that worry me are the inadequacy of the economy’s growths translation to the middle class and the brittleness of the economy,” he said.
He argues the tax cut package cut rates too much and created more tax shelters. And he calls China a profound threat.
Summers points out the federal government fails to collect $600 billion in taxes owed each year. He said that the Internal Revenue Service is auditing millionaires at one-third the rate it was 15 years ago. And people making $37,000 a year and claiming the Earned Income Tax Credit are more likely to get audited than someone making $1 million.
“On average, one extra average hour of auditing a millionaire yields $4,500 in revenue," he said. "And I’m here to tell you that hiring an IRS agent to do an audit does not cost 4,500 dollars an hour.”
Summers also discussed lack of wage growth. He said there should be more legal protections for workers who want to unionize and more regulations helping employees get overtime pay.
He expressed concern about people who don’t have the opportunity to attend college because they’re not getting enough skills training to go into the workforce.
