U.S. Representative Kevin Brady (R-Tex.) predicts President Biden could make a big mistake that hurts American workers.

"I think it's a major economic blunder to raise taxes on job creators, as we're urging them to hire more Americans, and do it in a way that both hurts working families and drives U.S. jobs overseas," he told Yahoo Finance Live.

Brady is the ranking member of the House Committee on Ways and Means but he was chairman when the Trump administration passed the historic 2017 Tax Cuts and Jobs Act, which cut the corporate tax rate to 21%. Biden wants to raise the corporate tax rate and reverse some of the other tax cuts to help pay for his multi-trillion dollar American Jobs Plan.

"We are confident that the investments and tax proposals in the Jobs Plan, taken as a package, will enhance the net profitability of our corporations and improve their global competitiveness," U.S. Treasury Secretary Janet Yellen told the U.S. Chamber of Commerce.

Brady disagrees. "I think we need to be smart [about] how we get people back to work. I worry that some of these policies actually undermine or sabotage our jobs recovery."

He dismisses critics, including the Congressional Budget Office, who say the Trump tax cuts created huge deficits. "What we do know is if you reverse those tax cuts, you see the opposite. You see flatter paychecks, more jobs moving overseas, slower jobs growth going forward," he said.

'Paid more to stay home'

Brady and other Republicans blame federal unemployment benefits for creating a labor shortage and a barrier to get people back to work. "They are so generous in America today, four out of 10 Americans are being paid more to stay home than to go back to work," he said.

Those benefits expire in September. But Brady applauds the more than 20 states that have already canceled federal unemployment insurance for their out-of-work citizens because he says, "Many of them can get better health care by not working, than returning to work. All of that is creating, I think the wrong incentives."