GEORGE STEPHANOPOULOS, HOST: Crisis in Puerto Rico.
UNIDENTIFIED MALE: It's been absolute hell.
STEPHANOPOULOS: With the island devastated from Hurricane Maria, the Trump team touts its response.
STEPHANOPOULOS: Drawing this from the mayor of San Juan.
CARMEN YULIN CRUZ, MAYOR OF SAN JUAN, PUERTO RICO: Damn it, this is not a good news story, this is a people are dying story.
STEPHANOPOULOS: The president struck back on Twitter, accusing the mayor of poor leadership, adding adding Puerto Ricans want everything done for them. The mayor joins us live to respond.
And Trump's health secretary forced out over private plane travel paid for by you.
TOM PRICE, FORMER DEPARTMENT OF HEALTH AND HUMAN SERVICES SECRETARY: Clearly, we were not sensitive to the taxpayer.
STEPHANOPOULOS: More cabinet officials now under investigation.
Plus, after health care goes down, President Trump pushes tax cuts.
TRUMP: A giant, beautiful, massive, the biggest ever in our country tax cut.
TRUMP: And it's not good for me, believe me.
ANNOUNCER: From ABC News, it's This Week. Here now, chief anchor George Stephanopoulos.
STEPHANOPOULOS: Good morning.
Then came Maria's cataclysmic hit on Puerto Rico, a category 4 storm that destroyed so much of the island. For days, the president was silent. He played catch up much of this week. And Saturday morning, this storm on twitter.
"Such poor leadership ability by the mayor of San Juan and others in Puerto Rico who are not able to get their workers to help. They want everything to be done for them when it should be a community effort.
No president has ever unleashed a public attack like that during a natural disaster. The backlash has been swift and ferocious, including this defense of the mayor from the creator of Hamilton Lin-Manuel Miranda: "she's been working 24/7. You've been golfing. You're going straight to hell. Fastest golf cart you ever took."
CRUZ: Well, first of all, Mr. Stephanopoulos, there's only one goal and it's saving lives. So, any -- any dialogue that goes on just has to be able to produce results. And all I did last week, or eventhis week, was ask for help. It has to happen in a sustained manner, it has to happen quickly. And mayors all over Puerto Rico are getting to the supply areas and been told, look, call us a few days later.
Ppeople have been told to register via internet for FEMA relief when we don't have any internet or very little internet even in the San Juan metropolitan area.
I recognize the good heart that the FEMA people have, they want to help, but they don't have the resources. And it's not just me saying it, General Buchanan , a three-star general, appointed now to take care of the situation, said two days ago we just don't have the resources in order to handle the logistical support that is need in San Juan and Puerto Rico, but we have done all that we can.
People are out there, they're cleaning the streets. Community kitchens are coming up. And we are getting tons of donations.
On Thursday, I got three pallets of baby, four pallets of food, and four pallets of baby supplies from FEMA. All of this I gave to the mayor of Camarillo, a town whose mayor had come to the FEMA distribution center and had been told just wait until next Monday because we have nothing.
STEPHANOPOULOS: You know, the president...
CRUZ: And on and on and on goes as far as the mayors.
STEPHANOPOULOS: The president's FEMA director is suggesting you're not really plugged in. Yesterday, he said you need to make your way to the joint field office and get plugged in to what's going on.
Have you been to the joint field office? And if not, why not?
CRUZ: Well, number one, I got a call from the White House a couple of days ago. I think it was Thursday. Mr. Bossert took it upon himself to call and I was very glad that he called. He seemed to be a very action-prone -- a guy that does what he says and says what he does.
So we got appointed a FEMA coordinator. We have two people that are appointed to San Juan. We are the capital city, the largest city in Puerto Rico, with the most amount of population. And we got appointed just -- direct links. So, actually, I was in FEMA the couple of days afterwards. When they were at the San Juan Marriott, I was invited to visit and we have been communicating ever since.
Things have to be done in a sustained manner. If I only get for a population of 350,000 or perhaps half of them are in need of food and water, sustained supplies, then, you know, I get four pallets of food, three pallets of water, that's really not even going to provide for a dent.
The supply chain of aid has to be sustained. And we have the logistics in order to do that.
STEPHANOPOULOS: Will you meet with them?
CRUZ: People from my administration, people from my administration have been to the -- yes.
STEPHANOPOULOS: Will you meet with the president on Tuesday? And what do you want him to see?
CRUZ: Well, if he asks to meet with me, of course I would with him. I mean, you know, anything that can be done and anyone that can listen.
Again, I have been quite complimentary of the people from HHS and FEMA. Their heart is ni the right place, but we have to cut the red tape. That's the one message.
And number two, let us not a talk about the debt, let us not talk about the cost of reconstruction, let us talk about saving lives right now, putting back the power grid as soon as we can, because that has an immediate effect on our ability to recover financially.
STEPHANOPOULOS: Are you concerned that the debt is going to be an impediment to Puerto Rico getting the help it needs over the long term?
CRUZ: Well, I hope it isn't. But certainly, some of the comments that have come from the White House seem to point to that direction. You put the people above the debt, you put lives and avoiding deaths above the debt, that is just a -- how things are done.
I mean, and this is what -- I lived in the States for 12 years. I went to school at BU and got my masters at Carnegie Mellon. I worked for the federal goverment and I've worked in private institutions in the United States. I know the good heart of the American people, and I know that when a mayday sound goes off they come to the rescue. They did it in Haiti. They did it in Africa. They've done it all over the world. We just want to it be done here in a Caribbean nation that has 3.5 million U.S. citizens.
STEPHANOPOULOS: Mayor, thank you very much for your time this morning. I know it has been a difficult 10 days.
CRUZ: Thank you very much. Thank you.
STEPHANOPOULOS: Now let's bring in the FEMA administrator Brock Long. Mr. Long, thank you for joining us this morning.
You just heard the mayor talk about her situation right there. Do you think as the president wrote yesterday, she's demonstrated poor leadership? And down in Puerto Rico, have you encountered anyone who has asked for everything to be done for them?
BROCK LONG, FEMA ADMINISTRATOR: So, the success of a disaster response is predicated on unity of command. And the bottom line is, just a few minutes ago we had a press conference from the joint field office in San Juan, that operation has hundreds of people it in working around the clock to set the strategic objectives, not only FEMA, DOD, but also the governor's objectives, and we have been working with mayors all around Puerto Rico to make sure that we have a strategy and that we have been executing that strategy going forward.
The unfortunate aspect is, is that we have tried to embed my staff with the mayor, and I think she just answered the question. I think she -- if I just heard correctly, she's been there once. This is an operation that has to take place all the time. She does have access to commodities. We have established 11 regional distribution hubs, not distribution points, but hubs, where there are large quantities of commodities and food.
And many -- what we are doing is, is that we had to set up a foundational baseline capability to be able to get commodities to the jurisdictions. In many cases, the mayors are stepping up and driving in to get their commodities and going back.
Mayor Otero, right outside of San Juan in the city of Guaynabo, has been very pleased with what we have been doing and the strategy that we have been executing, and so are many of the mayors.
The problem is, if you're not connected into that joint field office, then you don't understand commanders' intent. You don't understand the successes of what been done versus what needs to be done where the gaps are.
And, you know, George, the bottom line is our guys have been working 42 days now across Texas, Florida, both islands, and we're going to continue to push forward. We're not satisfied until the situation is stabilized and sustained.
We pushed everything into that island that we can. And it's not just pushing everything in, it's getting it distributed. But we're also having to do a major of the work because of diminished capacity at the local level. They got a hard hit. Two had hurricanes in ten weeks, two major hurricanes in 10 weeks. So, it's not only just getting food out, we had over 3,200 different problems with the roadway network that were reported where bridges had been wiped out where flooding has taken out the roads. So just being able to push commodities down these arteries has been tough enough.
STEPHANOPOULOS: We have also seen the mayor out there in the water as well. She just said she thought FEMA's heart was in the right place. They're starting to cut through the red tape right now. Do you really think the Puerto Ricans haven't been pulling their weight?
LONG: Oh, I believe the Puerto Ricans are pulling their weight. I mean, I think they're doing what they can. You know, what the -- you know, the bottom line is -- the question is that a local mayor's job is to push commander's intent down to his or her troops. And in many cases, those -- that commander's intent from a mayor down to their troops has to be aligned with what the governor's priorities are as well as FEMA. That's called joint priorities.
And the bottom line is, is that we're not only fixing roadway networks, we're doing emergency power, we're getting fuel to hospitals. We have opened up 700 gas stations. The private sector grocery retail industry has come up to about 50 percent, as I understand it. Telecom has been turned on to a third of Puerto Rico, which is why we're asking people to try to call in to the FEMA system, but also register across the line. But I have disaster assistance employee teams that are inundated Puerto Rico, going door to door, neighborhood to neighborhood, to try to get people registered.
And over the last 42 days, FEMA has registered nearly 3 million people for assistance from all the of the disasters starting with Harvey and over.
The other complexity of what FEMA is facing is is that we -- you know, yesterday, we were involved in 20 states and two island territories helping people overcome disasters and manage through the recovery process. The complexity of this job and the Herculean effort of the people behind me and the federal government has been incredible.
STEPHANOPOULOS: You all have faced an incredible challenge over this last month, there's no question about that at all.
Is everything on track now in Puerto Rico?
LONG: We got a long way to go. And the bottom line is, is that we can only push as logistically far as the situation allows. And what I mean by that is, is you know yesterday, we had to implement additional evacuations from the Guajataca Dam again because of the rainfall and the flash flooding reports that were put out.
So, you know, where we're finding success in one area, in some areas, we see setbacks. But we are making progress, in my opinion. So, you know, it's a slow progress. And we have to remember that there was a weak infrastructure. I mean, call it as it is. The weak infrastructure, lack of building codes, the place was wiped out, not by one hurricane, but by two.
STEPHANOPOULOS: Mr. Long, thanks very much for your time this morning.
LONG: Thank you, George, I appreciate it.
STEPHANOPOULOS: Let's bring this to our panel right now. Let's start out with Republican strategist Alex Castellanos.
We just heard both sides from the ground right there. You have also heard a lot of commentaries saying that yesterday might have been President Trump's Katrina moment here with Hurricane Maria. Do you agree?
ALEX CASTELLANOS, REPUBLICAN STRATEGIST: I don't think so.
First of all, we're all shocked to see that our connected world is such a fragile one. I think that affects all of us. But politically, people will forgive mistakes and imperfections in a massive effort here, they won't forgive is indifference. And they're not seeing that here. They're seeing a massive U.S. effort to go in here, you know, 11,000 people, water, food, 2 million, I think, units of food down there. So the effort, the size of it, and the heroic effort these people are making I think is -- will have that political impact.
The mayor is understandably reacting desperately, like a panicky swimmer, almost threatening the people trying to rescue her. And that is understandable in her situation. But I think a lot of folks can be very proud of the effort -- we have learned a lot from Katrina.
STEPHANOPOULOS: Well, there's no question.
CASTELLANOS: Brock Long is a professional.
STEPHANOPOULOS: And we just heard that -- there's no question about that. Democratic Strategist Stephanie Cutter, I think FEMA has been doing a good job. There has been a kind of massive effort, which is what made the president's tweets yesterday in some way inexplicable.
STEPHANIE CUTTER, DEMOCRATIC STRATEGIST: Well, I think -- let's take a step back. When a hurricane or crisis is about to hit, you want to know that your president is in control and in charge. That's his number one goal is to protect the American people, yet from all accounts, it's clear that the president took the weekend off last weekend after the storm hit to play golf. He attacked the NFL.
He -- regardless of what was happening, he showed the American people that this was not his priority. As a result, I think that some things were delayed.
Look, if you look at when this hurricane struck, and when operations actually got in place...
CASTELLANOS: They were in place before the storm. The military was there...
CUTTER: Then why did it take a week -- let me just finish, why did it take a week to waive the Jones Act to allow ships to get in there? We did that in 24 hours in Sandy?
STEPHANOPOULOS: ...senior fellow at the Manhattan Institute. There did seem to be a bit of a disconnect last weekend and the president ramping up over the course of this week.
JASON RILEY, MANHATTAN INSTITUTE: Well, I think that is a little unfair. Throughout this hurricane season, I think the president has been very engaged. I think he's been very attentive. You have seen cabinet officials visiting Texas and Florida and so forth.
This -- this has been different. This is a bigger storm. This is weaker infrastructure. And I agree that maybe the shipping regulations should have been lifted earlier. But again, the problem was not getting supplies there, it was distributing supplies once they arrived because debris made the roads impassable.
But what's interesting here is that the public was giving the president pretty high remarks for his response to the storms that hit Florida and Texas, I believe 64 percent based on a CNN poll approved of the president's relief efforts.
I don't think he should have picked this fight with the mayor over the weekend, but this is a president who doesn't seem to be able to help himself in that regard.
But I think that he, on balance, has done a pretty good job.
STEPHANOPOULOD: Can he fix it, E.J. Dionne? Of course you're from The Washington Post.
E.J. DIONNE, WASHINGTON POST: I think that the president showed so many of his basic weaknesses. He took the disaster to which he responded least well, as Stephanie said. He was really slow. He was playing golf. So, now all our attention is focused on Puerto Rico, which is not good for him.
He insulted another female politician, let's just put that on the table, and got that out there. And he's got all of us asking, why is he picking this fight at this moment? His FEMA director was on here, a FEMA director doesn't want to have to join an attack on the mayor. He wants to be able to say, we're trying to do all we can yet he's in a bad situation.
So, I think it's a classic Trump error.
STEPHANOPOULOS: And Megan Murphy of Bloomberg, we've also seen the president talk about Puerto Rico's debt several times over the course of the week. It appears that there's at least chance that the relief here, the rebuilding effort here, is going to be treated differently from what we saw in Florida and Texas.
MEGAN MURPHY, BLOOMBERG: It is.
And let's go back to what this is about. Babies need to get water. The infrastructure is crippled. People are desperate for their lives. And we're talking about its debt and we're talking about petty partisan politics that he has with the mayor.
People may not forget indifference, but they also don't forget the politization of humanitarian crisis that we see in Puerto Rico. That is what this is about. The president has not shown the leadership from the top. People don't believe this is what he's focused on. And this is why we've seen this scattered response in some respects to this in terms of both lifting of the Jones Act and getting military support in when they need it.
These people are desperate. They need help. That is what the president should be focused on.
CUTTER: Just look at how he spent most of last week talking about this before he started lobbing insults at the mayor. He was perplexed that Puerto Rico was an island in the middle of the Atlantic.
MURPHY: Surrounded by big water.
DIONNE: There's a lot of big water there.
CASTELLANOS: I don't think that was a geographic mystery. I think he was making the point that unlike Florida, where a lot of people are available from other states to help, this was a massive logistical...
MURPHY: And it is, absolutely.
CUTTER: ....and the president of the United States needs to have their arms around that. And he didn't have his arms around that.
CASTELLANOS: Are you kidding? Tens of thousands of people visit Puerto Rico. Your saying that makes the relief effort easy?
You know, when an infrastructure on an island is destroyed by a storm, you have to build bridges before you can deliver aid over them.
DIONNE: But then why did he attack the people of Puerto Rico early on saying they're not really pulling their weight?
CASTELLANOS: He is defending the 11,000 people, military people, FEMA staffers, who are there on the ground trying to help them, because you can't let that...
MURPHY: By attacking the people who are suffering from the tragedy?
CASTELLANOS: Sorry, you can't let the panicky swimmer determine....
STEPHANOPOULOS: Do you really want to be calling the mayor a panicky swimmer?
CASTELLANOS: I think it's understandable how desperate some of these people are in a horrible situation, but you can't let that sense of panic run the organization. You need a disciplined effort. And I think President Trump is right to defend the 11,000 American people who are on the ground there now trying to help these poor people.
STEPHANOPOULOS: All I would say is we would not be sitting here today talking about this if the president sent a tweet defending the 11,000 people on the ground.
RILEY: President Trump has shown himself time and again to enjoy these public disputes with people, whether it's Kim Jong-un, whether it's the attorney general, or the mayor of Puerto Rico. He seems to think that this is a presidential way to behave.
I disagree. His rhetoric, his tone, was off the mark.
CASTELLANOS: It was combative.
RILEY: But I don't think that we can equate that with a difference.
CASTELLANOS: But he fights this way about everything. You're right.
DIONNE: You've got to govern.
STEPHANOPOULOS: We have got to take break. I want you al to stand by. Back with more analysis later.
Up next, the president's tax plan. We're going to be right back with Treasury Secretary Steve Mnuchin and Senator Bernie Sanders.
(BEGIN VIDEO CLIP)
DONALD J. TRUMP, PRESIDENT OF THE UNITED STATES: Our framework includes our explicit commitment that tax reform will protect low income and middle income households, not the wealthy and well-connected. They can call me all they want, it's not going to help. I'm doing the right thing. And it's not good for me, believe me.
(END VIDEO CLIP)
STEPHANOPOULOS: President Trump on Wednesday, touting his tax plan.
Let's take it now to the president's Treasury secretary, Steve Mnuchin, joining us this morning. Mr. Secretary, thank you for joining us this morning.
We just heard the president right there.
Also, you and your colleagues have said the wealthy will not get a tax code under the plan.
But it's really hard to see how that can possibly be true, given the fact that your plan proposes cutting the top rate, eliminating the estate tax, eliminating the alternative minimum tax, cutting that rate on pass-through entities.
And the non-partisan Tax Policy Center calculates that 80 percent of the benefits will flow to the top 1 percent. We're going to show that chart right now.
Almost every group getting a tax cut, but the wealthiest getting the most.
That's just a fact, isn't it?
STEVEN MNUCHIN, TREASURY SECRETARY: George, first of all, it's great to be with you this morning. And, no, that's not a fact.
As we release the details of the plan, we'll show the -- all the different impacts to different people. And as the president has said all along, the changes to the income tax system are meant to create middle income tax cuts and also make corporate and business tax competitive so we can bring back tons and tons of jobs and capital to this country.
STEPHANOPOULOS: I know that's the objective, but based on the evidence you've put out so far, all those cuts I just talked about, that will benefit the wealthiest the most.
MNUCHIN: Well, George, I just don't think that's the case. As we've talked about, changes in the the top bracket are offset with elimination of almost every single type of deduction, other than charitable giving and the mortgage interest deduction.
And, you know, this has impact to different people in different states, but again, we'll go through all the details as we go through the Congressional process of the House and the Senate and we'll show all the distributions.
And as it relates to pass-throughs, this is about creating jobs. A huge component of the businesses in this country are pass-throughs and we want to make sure they have the necessary tax relief to go out and hire more workers and invest more capital.
STEPHANOPOULOS: You know, Secretary, I just don't understand how you can say, based on everything you've put out so far, that it's not a tax cut for the wealthy. Even the vice president has said these are across the board tax cuts. The wealthy pay most of the taxes. They are getting tax cuts there. They are going to get benefits.
MNUCHIN: Well, George, in the high tax states, the impact is about 5 or 6 percent. So if we cut the rate down to 35 percent, that's actually an increase for the wealthy in the high tax states. And as we've said, we're considering what we do, if there is a need for a fourth bracket, to create more relief.
So this will all continue to go through the Congressional process.
STEPHANOPOULOS: But eliminating the estate tax will only go to the wealthiest Americans, those that have estates greater than $11 million.
MNUCHIN: Well, you are correct in that sense. And, again, we've been talking about the income tax system. As it relates to estate tax, you know, the death tax, we believe that people get taxed once and not twice. And that will enable them to keep lots of family businesses passed along.
But the estate tax, you are correct. The majority of the estate tax is paid by the wealthy. So we're focused on changes to the income tax system.
STEPHANOPOULOS: But you've proposed to eliminate the estate tax.
On those changes to the income tax system, if I understand you correctly, you say the objective is that the wealthiest will not get a benefit.
So are you saying that the president is going to veto a final bill if it provides a tax cut to the wealthiest Americans?
MNUCHIN: The president very want -- much wants to get tax reform done, because it's critical to the growth in the economy, and that's something we've been talking about since the campaign.
We fundamentally believe we can get back to sustained 3 percent GDP or higher, which adds literally millions and millions of jobs and over $10 trillion to GDP. And that's our focus.
So the president wants to get tax reform. We're working with the House and the Senate and we hope to get on his desk to sign in December.
STEPHANOPOULOS: Right. But he's also said, and you've just repeated, that he doesn't want the wealthiest Americans to get a benefit from this tax reform plan.
So if Congress sends him a bill that provides benefits to the wealthiest Americans, will the president veto it?
MNUCHIN: George, I think the president will look at the bill when it comes in its entirety. Again, as we've been consistent, the president's objective -- and I think Congress has heard that -- is to create middle income tax cuts and not tax cuts to the wealthy.
And as I just mentioned, the existing plan actually has tax rates going up in many, many states. So we're sensitive to the impact to the economy. We want to get the federal government out of the business of subsidizing the states. We think that's the right thing to do. And it will have impact on different states.
So we'll continue to look through this as we go through the process.
STEPHANOPOULOS: There could be that impact, but as -- based on the evidence you all have put out so far, independent analysts have said that the benefits are going to go to the wealthiest.
I want to go to the benefits for President Trump personally, because he himself has said that he's not going to benefit from this tax plan. Again, that's hard to see how that's true, given the estate tax, the elimination of the AMT, which has benefitted the president in the past, the cut in the top rate. But, also, we talked about these pass-through entities.
And based on the president's financial disclosure form, just from this year -- we want to put it up right now -- he had about -- more than $500 million in taxable income from those pass-through entities taxed at 39.6 percent.
You cut that to 25, that's a savings of $75.7 million, based on the president's financial disclosure form last year.
MNUCHIN: George, as we've said all along, as we change the pass-through rate, it's very, very important that we have guard rails around those rules so exactly as you've said, this isn't about creating a tax cut for the rich.
So we spent a lot of time with the staff at the House and Senate. We're continuing to work on those rules. But we're going to make sure that that's not a way that the rich can use to pay lower taxes than they should, whether it's the president or anyone else.
STEPHANOPOULOS: Well, but based on last year's form, he would have gotten that benefit.
So how are Americans going to know whether or not the president gets this benefit if he doesn't release his tax returns?
MNUCHIN: George, that's just not fair, because, again, we haven't published the rules as to what's going to apply to the pass-through rate. So you're making certain assumptions that I don't think are correct.
STEPHANOPOULOS: I wouldn't need to make the assumptions if we had the president's tax returns. And I guess that's the question. The president himself has said publicly he's not going to get a benefit from this tax plan.
My question to you is, how are the American people going to know that if he's not, releasing his tax returns?
MNUCHIN: Again, George, I think the American public will be comfortable with the information that they have. As you've pointed out, the pass-through rate is something we need to be careful about, as you've just described. And we're going to make sure that there's the proper rules. There's going to be full transparency as we go through the legislative process, what those rules are, so that rich people can't take advantage of it.
STEPHANOPOULOS: You talked about transparency, but in the interests of transparency, can you guarantee that the president won't get a tax cut under his plan?
And how will you demonstrate it?
MNUCHIN: Again, as I've said all along, the objective of the president is that rich people don't get tax cuts. And we're perfectly comfortable, as we go through this process, we'll explain to the American public how that works and we'll give plenty of examples.
STEPHANOPOULOS: Will you give the information about the president himself so he can back up the claims that he's made that he's not going to get a tax cut under this plan?
MNUCHIN: George, I can't comment on what the president will do or what he won't do on that. But again, I'm perfectly comfortable that the American public is going to understand this as we go through this process, because what this is about is creating middle income tax cuts and creating a corporate tax system that's competitive.
We have one of the highest tax rates in the world. We have a concept of deferral. Our companies leave trillions of dollars offshore.
Those are jobs -- that's money we want to bring back. We're going to create expensing that incentivizes companies to spend capital here and create jobs.
And the American public understands. This is about jobs. This is a jobs bill.
STEPHANOPOULOS: Well, I don't understand how you can provide that assurance to the American public about the president and the wealthy if you don't release his tax returns.
But you also talk about the goal being a cut in middle class taxes. And under the plan, from what we can tell so far, most middle class families will get a tax cut. But there also appears to be many middle class families who will get a tax increase. The Tax Policy Center said that by 2027, taxes would rise for regular one quarter of taxpayers, including nearly 30 percent of those with incomes between $50,000 and $150,000, and 60 percent of those making between $150,000 and $300,000.
The top tax official here in New York City has said that about three million people in New York will see their taxes go up because of the elimination of the state and local tax deduction, nearly half of the middle class residents in New York earning between $50,000 and $75,000 a year.
So some middle class Americans, including many here in New York, will get a tax increase.
MNUCHIN: Well, I don't know how the Tax Policy Center can publish those figures, since they don't have all the details, including the brackets. People like the Tax Foundation and others have waited, which I think is responsible, when we release all the information...
STEPHANOPOULOS: But that's on you.
MNUCHIN: -- and it's a...
STEPHANOPOULOS: -- isn't it...
STEPHANOPOULOS: -- if you haven't released the details?
MNUCHIN: Yes, well, we're working with the House and Senate. It's going through committees. And those details are going to be released. And we've said that continuously.
And as it relates to New York, I'm sympathetic to the issues in New York. As you know, I've paid taxes in New York and California, which are two of the highest taxed states. And, you know, if we eliminate the subsidies to New York and California, that creates certain issues.
But I don't think it's fair that a bunch of other states are subsidizing New York and California. And, you know, that's going to be an issue for me, as well, as I pay taxes there.
STEPHANOPOULOS: So if taxes go up on middle class New Yorkers, so be it, middle class Californians?
MNUCHIN: No, that's not what I've said. What I've said is we're trying to create certain adjustments so that the middle class and New York and California don't get hit hard by this.
But there are issues, as you've said, when we change a system where we eliminate the tax subsidy of certain states, that will impact different people in different states. And we're working through the details of that.
That's why, as we haven't released the full plan. We're working with the committees. We want the committees to understand this. And we're very focused on middle income tax relief.
STEPHANOPOULOS: But you can't guarantee that all middle class individuals will receive a tax cut, can you?
Some will get a tax increase.
MNUCHIN: No. It is our objective that the entire middle class does get a tax cut. And that's something we're working on the details.
As you said, you can't make guarantees, because every single person's taxes are different. People take advantage of different things, so we can't make that guarantee. But we can say that's our objective and that's what we're working to and we want to protect the middle class.
We went to Indiana last week. We had a specific family that's getting a $1,000 cut under our plan. We had businesses there that are getting tax cuts so that they can grow jobs. And that's what we're trying to do.
STEPHANOPOULOS: And, again, that's what you're trying to do. But again, let me go back to the question similar to the one I asked earlier, will the president veto a bill if it comes back to him, with middle class tax increases for some Americans?
MNUCHIN: George, the president isn't setting any criteria up front as to what he's going to veto and what he's not going to veto. What the president is doing is working with Congress. It's been over 30 years since we've had tax reform. We have a broken system. We have to fix it.
We have to create jobs. We have to simplify taxes. And we've got to make a system that works for all Americans and all American business. This is an American jobs act and the president has worked -- is going to work with Congress to get these objectives.
And as I said, hopefully we'll get something on his desk to sign so we can continue to have the economic growth in this country we need.
STEPHANOPOULOS: One of the other big questions is impact on the deficit. We've already seen Senator Bob Corker say he's not going to vote for any tax cut that increases the deficit.
(BEGIN VIDEO CLIP)
SEN. BOB CORKER (R), TENNESSEE: No way that Bob Corker is going to vote for a tax reform bill that I think in any way is going to add to the deficit. It's not going to happen, never. It's never going to happen. Never, never, ever.
(END VIDEO CLIP)
STEPHANOPOULOS: Again, based on the details you've provided so far, there's about $2 trillion more in tax cuts than closing of loopholes and ending deductions.
Can you commit that the bill will not increase the deficit?
And if it does, are you concerned you're going to lose the votes of Senator Corker and others?
MNUCHIN: Well, I've had the opportunity with Senator Corker and others and walk them through the math. And here's the math, George, so you understand it.
Our current plan, on a static basis, will increase the deficit by $1.5 trillion that will be offset by -- there's a $.5 trillion difference between what we call the baseline in policy, which is rolled over.
So that $1.5 trillion should be addressed down to $1 trillion. And we believe there will be $2 trillion of additional growth.
So under our plan, we believe this will cut the deficit by $1 trillion and that's what we're focused on.
And that's with a conservative, 2.9 percent GDP over the 10 year period of time.
STEPHANOPOULOS: You say that's conservative, but the median forecast from the Fed is 1.8 percent over time and 21 out of 26 economists surveyed by Bloomberg say that this will increase the deficit and your growth projections are too big.
MNUCHIN: Well, the current GDP estimates by all those people are because they're not taking into account what the administration is doing, whether it's regulatory relief, trade re-negotiations or tax reform. And we just had -- we've had 3 percent GDP numbers because you see the economy is anticipating and reacting to President Trump's plan.
But you're correct, if we don't pass through on this tax reform, we won't get this growth. And that's why we need it. That's why this is critical to get done.
STEPHANOPOULOS: And if you don't get the growth, will you scale back the spending, scale back the tax cuts?
MNUCHIN: Again, we're confident we'll get the growth. But if we don't get the growth, that's obviously something that can be changed over time.
STEPHANOPOULOS: Mr. Secretary, thanks for your time this morning.
MNUCHIN: Thank you very much.
STEPHANOPOULOS: We're back in just two minutes with reaction to the GOP plan from Senator Bernie Sanders.
STEPHANOPOULOS: And we are back with Senator Bernie Sanders.
Senator, thank you for joining us again this morning.
SEN. BERNIE SANDERS (D), VERMONT: Good to be with you.
STEPHANOPOULOS: Well, you just heard Secretary Mnuchin right there. He says the goal is no tax cuts for the wealthy, huge benefits for the middle class. They've projected a cut in the deficit of about $1 trillion over the next 10 years.
Are you ready to sign on?
SANDERS: Not quite, George.
I mean I think everything he said is dead wrong.
No tax breaks for the rich. They are repealing the estate tax. The estate tax only applies to the top.2 of 1 percent -- millionaires and billionaires like the Walton family of Walmart, like the Koch brothers family, like the Trump family: $269 billion in tax breaks for the top two-tenths of 1 percent over the next 10 years. This is not a tax break for the rich? Well, I don't know what a tax break for the rich is.
The Tax Policy Institute, in fact, has estimated, based on the information that they now have, that at the end of ten years, 80 percent, 8-0 percent of all of the tax benefits go to the top 1 percent.
Further, in the midst of all of this stuff, there is a $450 billion cut in Medicare. Now, you may remember that when Trump ran for president, he promised working families, oh, he's not going to cut Medicaid. He's not going to cut Medicaid. A $1 trillion cut in Medicaid, $450 billion cut in Medicare.
What this is is a massive transfer of wealth. It's the Robin Hood principle in reverse. He's taking from working families and low-income people and giving to it the super rich and creating a $1.5 trillion deficit.
STEPHANOPOULOS: As you know, the president is actively quoting Democrats. He appeared in Indiana with Senator Joe Donnelly. This week Heidi Heitkamp of North Dakota, Joe Manchin of West Virginia, all of them are up in 2018. If a Democrat votes, Democratic Senator votes for this bill, will you support a primary challenge?
SANDERS: Look, the issue is, I would hope that Democrats from one end of this country to the other would be fighting this proposal. This is not politics, George, this is just really, bad policy. And I'm not clear why anybody would support a proposal, which gives massive amounts of tax breaks to the people who don't need it at a time of incredible income and wealth inequality in America.
If anything, right now, what we must be demanding is that the wealthiest people in this countrystart finally paying their fair share of the taxes.
STEPHANOPOULOS: What would that be?
SANDERS: I'm sorry?
STEPHANOPOULOS: What would that be? What should the top rate be?
SANDERS: Well, that's something we have to work on. But when you have the top one-tenth of 1 percent now owning almost as much wealth as the bottom 90 percent, it is very clear to me that the wealthiest people in this country have got to start paying their fair share of taxes.
You've got major corporations making billions of dollars a year in profit, stashing their profits in the Cayman Islands and Bermuda and at the end of the year not paying one nickel in federal taxes.
STEPHANOPOULOS: Any tax cuts you will support right now?
SANDERS: I'm sorry?
STEPHANOPOULOS: Any tax cuts you would support right now?
SANDERS: Well, I think we have got to focus on the needs of the middle class and working families of this country, those are the people who need help, not the top 1 percent.
STEPHANOPOULOS: What would that mean?
SANDERS: Well, I think you can raise the standard deduction. I think what Trump was talking about is right, but he gives with one hand and takes away with the other by repealing the personal exemption. We also need to expand and improve the Earned Income Tax Credit to help working families. So, there's a lot that can be done.
But bottom line is when you have massive income and wealth inequality, when the rich are getting richer and most Americans are getting poorer, you don't give tax breaks to billionaires, you give tax breaks to the people in need.
STEPHANOPOULOS: You have got more than a dozen Democrats now supporting your Medicare for all plan in the Senate. You're campaigning hard all across the country.
Two quick questions, how do you respond to those who say you're pulling the party too far to the left? And is it fair to say given your activities, you're not ruling out another run for president in2020?
SANDERS: Well, let me just say that the idea of a Medicare for all, the idea that the United States of America should join every other major country on Earth in guaranteeing health care to every man, woman, and child, this is not a radical idea. In fact, poll after poll shows that a majority of the American people support that idea. People want to know why, as a nation, George, we are spending twice as much per capita on health care as the people of Canada or many of the European countries while our health care outcomes are not necessarily as good. And people also want to know why we pay by far the highest prices in the world for prescription drugs.
So, I don't see this as a radical idea. I see it as an idea that more and more people want. Medicare today is a very popular program. It's the most popular health insurance program in the country. Let's expand to it to everybody over a four year period.
STEPHANOPOULOS: Senator Sanders, thanks for your time this morning.
SANDERS: Thank you.
STEPHANOPOULOS: We'll be right back with more roundtable.
STEPHANOPOULOS: Roundtable standing by. We'll be right back.
(BEGIN VIDEO CLIP)
ROY MORE (R-AL), CANDIDATE FOR SENATE: We can support the president. Don't let anybody in the press think that because he supported my opposition that I do not support him and support his agenda. As long as it's constitutional, as long as it advances our society, our culture, our country, I will be supportive.
(END VIDEO CLIP)
STEPHANOPOULOS: Republican Senate candidate Roy Moore right there.
He defeated the president's candidate in the primaries this week, the same day that ObamaCare repeal and replace went down again in the Senate.
We also saw that scandal this week over private planes and the resignation of Health and Human Services Secretary Tom Price.
Back with the roundtable right now.
And Megan Murphy, let me begin with you from Bloomberg.
Those are the -- that was all the tough news for the president this week.
Clearly, the hope is tax cuts are going to make up for it.
MURPHY: Well, clearly, that's the hope. But it's been amazing to watch this roll out in terms of how they're going to be able to defend this policy given what is the distributional effect that way disproportionately benefits the top 1 percent and the top 0.1 percent.
An independent, non-partisan group has come out and said that 80 percent of the benefits by 2027 will accrue to the top 1 percent.
That means if you're a family making over $900,000, under the plan details that we know so far, you're going to get a $200,000 tax cut. We know that this is something that is politically -- one of the least popular move is to cut taxes for the wealthy.
STEPHANOPOULOS: Which is why they're denying that that's going to be the ultimate impact.
But Jason Riley, I mean it's hard to see Congress coming back with anything that's not going to disproportionately impact the wealthy and benefit the wealthy, because the wealthy pay most of the taxes.
RILEY: Right. Exactly. And I think the administration would do better to come out and say this is about economic growth and tax relief for the most productive, well-off people in society is not inconsistent with economic growth. Those two things are not at cross purposes here.
The real value-added of this plan, I think, is the corporate tax rate. We've got something like $2.5 trillion of corporate money stashed away overseas. We want that money brought back here, invested into businesses here, invested into lifting wages.
People are concerned about stagnant wages. That's what this is about.
But giving tax cuts or tax relief to wealthier individuals is not at cross purposes with economic growth. And that's what this is about, juicing the economy.
STEPHANOPOULOS: E.J. Dionne here with "The Washington Post." You also have a new book, "One Nation Under Trump." (INAUDIBLE) talk about that before.
But E.J. You know, it's clearly, the White House concerned about this argument that these are tax cuts for the wealthy.
Is that enough to stop the Senate and the House from passing it?
DIONNE: I think there is a chance that you're going to lose three Republican votes on this in the House. You already have 33 Republicans from states that really benefit from the deduction for state and local tax...
STEPHANOPOULOS: New York, California and New Jersey.
DIONNE: -- (INAUDIBLE). But look, they can't say what Jason said they should say, because then Trump would admit he's lying. And I think what brings together this fight with the health care fight is they have to tell a lot of lies to justify it.
It didn't work on health care. Here, they not only have to pretend that this doesn't help the rich, but they're playing a shell game here. They're saying right now with magic numbers this won't affect the deficit.
So they pass it, and then three years down the road, Republicans will say oh, my God, look at those high deficits, we have to cut programs for the low income people, for -- we've got to cut Medicare and Social Security.
If we fall for this, I can't imagine we're going to fall for this (INAUDIBLE)...
STEPHANOPOULOS: And Alex, how snake pit are Republicans after the health care fight and the president's kind of wavering positions on first he liked the House bill, then he called it mean.
CASTELLANOS: Republicans are petrified. And Chuck Schumer and Nancy Pelosi are in control of the majority in the House and Senate because they've scared Republicans, as E.J. Just said, oh, you're the party of the rich again?
You were on health care. You're going to take away health care from poor people?
Can't do that. It killed health care.
They're doing the same now on taxes. And the Republican Party has become this kind of wussy establishment party that has no voice, stands for nothing and I don't think they're going to be able to get a consensus together to get tax reform done.
CASTELLANOS: They'll agree on tax cuts as long as they don't cut taxes, especially for the people who pay them, and they'll agree to some kind of tax cuts unless they help -- if they help the rich, oh, can't have that.
STEPHANOPOULOS: Stephanie, if Alex is right, you're going to have another revolt inside the Republican Party. Democrats will start to say, do we actually have a chance of getting back the House or Senate in the midterms?
CUTTER: Absolutely. You know, I don't think it's Nancy Pelosi and Chuck Schumer who have created this unrest in the Republican Party, I think it's actually the president and his policies and throwing one house or the other under the bus when things aren't going his way.
I do think there is -- and I'm not in the Republican caucus, but I do think there is intense pressure to get something done.
STEPHANOPOULOS: They need a victory.
CUTTER: They need a victory.
And there is a chance -- I don't think massive reform, certainly not what has been laid out, has a chance of passing, I agree with that, not just because of where Democrats are, but becuase they're not going to be able to get a majority of Republicans to support this.
STEPHANOPOULOS: Megan Murphy, of course, Bloomberg covers the markets as well. I have been kind of mystified this year, Alex's analysis aside, by how convinced the stock market, the financial markets, have been all year long that all of this is going to go through kind of with ease.
MURPHY: No question the markets have priced in some type of comprehensive tax reform. We started to see it wobble a little bit when we've seen the president out and making these very controversial comments about the NFL. People are still pricing it in.
But they have brought a package forward now that is politically unsustainable. They can tweak the dials. They can talk about the child tax credit and moving that. They can talk about maybe actually keeping in place state and local deductions, which would take away so much of the the benefit of the wealthy.
But here's the key thing about this reform plan as they've rolled it out, if you make between $50,000 and $150,000, you're -- a third of your taxes are going to go up. If you make between $150,000 and $300,000, two-thirds of families' taxes are going to go up. So, actually, for many of these middle class and upper middle class workers, your taxes are going up.
STEPHANOPOULOS: If that turns out the be true, Alex is going to be right, that could be a killer.
That's all the time we have right now. We'll be right back.
STEPHANOPOULOS: For the latest politics any time, download the ABC News app and sign up for breaking news alerts. We're going to be right back after this from our ABC stations.
STEPHANOPOULOS: This roundtable is still going on, but that is all for us today. Thanks for sharing part of your Sunday with us. Check out World News Tonight. And I'll see you tomorrow on GMA.