STEVE INSKEEP, HOST:
It let's examine one part of Donald Trump's economic proposals. The Republican delivered an economic speech this week in Michigan. It'll be in the news all week because Hillary Clinton gives her own economic speech in Michigan today. Trump, among other things, targeted the cost of child care.
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DONALD TRUMP: My plan will also help reduce the cost of child care by allowing parents to fully deduct the average cost of child care spending from their taxes.
INSKEEP: Well, let's talk about who benefits with Stephen Moore. He's a well-known economist and an adviser now to Donald Trump. He's on the line. Welcome to the program sir.
STEPHEN MOORE: Good morning.
INSKEEP: So we just played Donald Trump saying that his plan would help reduce the cost of child care. What could people deduct here, day care, babysitting, nannies, what?
MOORE: Well, first of all, I mean, this is going to be one of the most sweeping tax reforms that we've had in this country probably since the mid-1980s, in 30 years. So we want - we do actually want to vastly simplify the tax system and collapse the tax rates. And on the business side, it'll be the business - biggest business tax cut probably ever. Now, in terms of deductions, we want to limit those as much as possible to simplify the code...
INSKEEP: But he's adding a deduction here, child care. What's he going to do with that?
MOORE: That's right. So there's going to be a deduction for child care because - in fact, this idea came from Ivanka Trump, who is a working mom. And she said, look, this is a major expense for working women, and it should be deductible as a cost of doing business. And we found that it was something that made a lot of sense and was actually quite popular with working women. So that is part of the plan.
INSKEEP: I'm sure it is popular, but it's a tax deduction, which is only valuable to people who make a considerable amount of money so they have a lot of taxes from which they can deduct something. What is Trump's plan going to do for working families who do not make so much money?
MOORE: Well, if you don't pay taxes, you can't get a tax cut. That's true. So people who make between - we estimate people who make between about $40,000 and about $150,000 a year will benefit from this. They will get to write off their child care expenses as a deduction from their adjusted gross income when they do their taxes. So we regard this as something for - you know, mostly middle-class moms will benefit from this, you know, people in that $60-$80-$90,000 a year range.
INSKEEP: What about people on the bottom?
TRUMP: Well, again, if you don't pay taxes, you can't get a tax cut. So, I mean, if you pay income taxes, you'll get a tax cut. But if you're someone who doesn't have a tax liability, then it's difficult to find a way to cut that person's income tax.
INSKEEP: Is this, as some of Trump's critics have said, a common feature of Trump's tax plan? He wants to cut taxes for the wealthy. He wants to abolish the estate tax, which is only paid by people who have more than $10 million in assets. And then he says it's for working people. Is there a bait-and-switch here?
MOORE: Well, first of all, it is not a tax cut for the rich. In fact, the way we devised this plan - because I was very intimately involved in doing it - is that, you know, the people at the top will get a reduction in their tax rate. They'll get a 33 percent rate, but that is dollar for dollar matched by the elimination of deductions. So we are going to phase out and cap deductions for high-income people. Now, if you're someone who makes less than $150,000, you'll still have access to all your deductions. But if you're Warren Buffett or Bill Gates, you're not going to get deductions. So it's not - it's not a tax cut for the rich. And when Hillary has said this, she just doesn't - she isn't familiar with what the plan is. It's almost like this kind of rote complaint about a tax cut even though the facts defy what she's saying.
INSKEEP: And you've specified what all the deductions are that are going away?
MOORE: They'll be capped, so it'll be a cap and, you know, somebody like Warren Buffett will be able to take somewhere around $50,000 to $75,000 of deductions, and then they're done, and they can choose which deductions they want to take. But they're not going to be able to, you know, write off, you know, millions and millions of dollars of tax deductions under this plan.
INSKEEP: Just got about 20 seconds here, but I have to ask - before becoming an adviser to Mr. Trump, you wrote to criticize his biggest economic priority - restricting free trade. Have you changed your mind?
MOORE: Oh, I'm a free trader, no question about it. And I just quickly say one of the things that I really admire about Donald Trump is he knows that I don't entirely agree with him on trade, but I'm one of his top economic advisers. And, you know, there's room for dissent in the Trump campaign. You wouldn't find that too much on Hillary's side.
INSKEEP: Stephen Moore, senior adviser to Donald Trump, thanks very much.
MOORE: Thank you Transcript provided by NPR, Copyright NPR.