1 00:00:04,200 --> 00:00:07,840 Speaker 1: Welcome to newt World podcast on the iHeart podcast network. 2 00:00:08,760 --> 00:00:14,600 Speaker 1: I think the most exciting development this week was Jared Isaacman, 3 00:00:15,160 --> 00:00:19,560 Speaker 1: who is the head of NASA, announcing a very bold, 4 00:00:20,400 --> 00:00:24,919 Speaker 1: very dramatic program that moves us way beyond where the 5 00:00:25,000 --> 00:00:29,000 Speaker 1: NASA bureaucracy was and thinking about going to the Moon, 6 00:00:29,560 --> 00:00:33,920 Speaker 1: to Mars and beyond. Isaac Winn is a remarkable entrepreneur. 7 00:00:34,520 --> 00:00:37,960 Speaker 1: He personally paid to go into space and is the 8 00:00:37,960 --> 00:00:40,600 Speaker 1: only civilian to have ever done a space walk. He 9 00:00:40,640 --> 00:00:44,080 Speaker 1: actually went into space twice to the Space station and 10 00:00:44,240 --> 00:00:49,000 Speaker 1: did a spacewalk while he was there. He's really knowledgeable 11 00:00:49,440 --> 00:00:53,159 Speaker 1: and he has the right bold instincts that could make 12 00:00:53,159 --> 00:00:58,960 Speaker 1: an enormous difference. Essentially, what NASA has now decided is 13 00:00:59,000 --> 00:01:01,400 Speaker 1: that they are going to go all out with a 14 00:01:01,560 --> 00:01:07,679 Speaker 1: very large, very dedicated program first to actually occupy the Moon. 15 00:01:08,200 --> 00:01:12,400 Speaker 1: There'd been some interim project which the bureaucrats had sold 16 00:01:12,400 --> 00:01:15,200 Speaker 1: themselves on where they were going to build a station 17 00:01:15,480 --> 00:01:18,480 Speaker 1: orbiting the Moon, and you had to say yourself, I mean, 18 00:01:18,520 --> 00:01:21,039 Speaker 1: what's the purpose of that. It was going to take 19 00:01:21,040 --> 00:01:23,319 Speaker 1: a lot of money. Equally important, it was going to 20 00:01:23,360 --> 00:01:27,520 Speaker 1: take time. We are moving into a world where you're 21 00:01:27,560 --> 00:01:32,479 Speaker 1: presently going to have both with the starship that Elon 22 00:01:32,600 --> 00:01:36,400 Speaker 1: Musk is developing, and with the work which Jeff Bezos 23 00:01:36,400 --> 00:01:39,720 Speaker 1: has indicated is now going to be in Blue Origins, 24 00:01:40,120 --> 00:01:44,360 Speaker 1: which is his competitor to SpaceX. He's now moving towards 25 00:01:44,680 --> 00:01:48,440 Speaker 1: bigger rockets, more rapid development, and the two of them 26 00:01:48,840 --> 00:01:51,520 Speaker 1: are in a real competition, and there are three or 27 00:01:51,560 --> 00:01:56,120 Speaker 1: four other private companies that are now developing real capabilities 28 00:01:56,200 --> 00:02:00,760 Speaker 1: in space. The result was Isaacman made the decisonion to 29 00:02:00,880 --> 00:02:04,680 Speaker 1: Gopher Broke, step past this interim step that would have 30 00:02:04,680 --> 00:02:07,240 Speaker 1: taken a lot of money and diverted a lot of time, 31 00:02:07,760 --> 00:02:12,120 Speaker 1: and instead goes straight towards developing a capacity on the 32 00:02:12,120 --> 00:02:14,959 Speaker 1: Moon that will include, by the way, in the very 33 00:02:14,960 --> 00:02:19,200 Speaker 1: first phase, putting a nuclear power source that will give 34 00:02:19,280 --> 00:02:23,200 Speaker 1: us permanent power, probably at the South Pole, which everybody 35 00:02:23,240 --> 00:02:26,679 Speaker 1: agrees is the most desirable single place on the Moon. 36 00:02:27,240 --> 00:02:32,160 Speaker 1: In addition, they're going to begin launches to preposition things 37 00:02:32,200 --> 00:02:34,640 Speaker 1: in Mars. That is, take things you know you're going 38 00:02:34,680 --> 00:02:37,480 Speaker 1: to need eventually and go ahead and start shipping them. 39 00:02:37,639 --> 00:02:40,480 Speaker 1: And that, of course was one of the original reasons 40 00:02:40,760 --> 00:02:44,520 Speaker 1: that Elon Musk wanted to build the Starship. The starship 41 00:02:44,840 --> 00:02:48,240 Speaker 1: hasn't quite completely worked yet, it's about to have its 42 00:02:48,280 --> 00:02:52,680 Speaker 1: six tests and has gotten almost perfect. As whenever the 43 00:02:52,919 --> 00:02:56,040 Speaker 1: Elon Musk models, they all have to return to Earth 44 00:02:56,360 --> 00:02:59,959 Speaker 1: and be reusable. They actually have one which I believe 45 00:03:00,040 --> 00:03:02,200 Speaker 1: of a Falcon nine, which I think has now been 46 00:03:02,280 --> 00:03:05,400 Speaker 1: used twenty three times, keeps coming back. They refuel it, 47 00:03:05,480 --> 00:03:08,040 Speaker 1: that fix it, put it back up into space, which 48 00:03:08,040 --> 00:03:12,840 Speaker 1: of course dramatically lowers the cost of launching things. So 49 00:03:13,240 --> 00:03:16,280 Speaker 1: from my standpoint, as somebody who has been looking at 50 00:03:16,320 --> 00:03:20,160 Speaker 1: space ever since Spotneck in nineteen fifty seven, and as 51 00:03:20,200 --> 00:03:23,440 Speaker 1: a young guy in seventh and eighth grade read Missiles 52 00:03:23,440 --> 00:03:27,639 Speaker 1: and Rockets magazine and was totally enthralled with the Apollo 53 00:03:27,720 --> 00:03:30,880 Speaker 1: program and get into the Moon, I see this new 54 00:03:30,919 --> 00:03:35,600 Speaker 1: development by NASA as a real moment of breaking out. 55 00:03:36,080 --> 00:03:38,200 Speaker 1: Now they've got to convince the Congress to fund it 56 00:03:38,240 --> 00:03:40,720 Speaker 1: and approve it. But the fact that the President has 57 00:03:40,720 --> 00:03:44,240 Speaker 1: approved it, and the fact that it really shows a 58 00:03:44,320 --> 00:03:49,320 Speaker 1: potential for the United States to get dramatically ahead of 59 00:03:49,360 --> 00:03:53,040 Speaker 1: the Chinese and anybody else, and to do it as 60 00:03:53,120 --> 00:03:57,040 Speaker 1: part of the Artemis program, which has a wide range 61 00:03:57,080 --> 00:04:01,120 Speaker 1: of countries. I was at a dinner Wuzzeland by the 62 00:04:01,120 --> 00:04:05,760 Speaker 1: European Space Agency, and we had a delightful conversation, including 63 00:04:05,840 --> 00:04:08,960 Speaker 1: with a woman who is an astronaut from Europe who'd 64 00:04:08,960 --> 00:04:11,720 Speaker 1: spent over a year in space, and you could sense 65 00:04:12,040 --> 00:04:15,000 Speaker 1: they all want to cooperate. They would like to see 66 00:04:15,280 --> 00:04:20,760 Speaker 1: space controlled by freedom, not by authoritarian dictatorships. They would 67 00:04:20,800 --> 00:04:22,880 Speaker 1: like to see us move as fast as we can 68 00:04:23,279 --> 00:04:26,800 Speaker 1: to make space normal, someplace that people are going to 69 00:04:26,839 --> 00:04:30,320 Speaker 1: be able to go and routinely develop. And I think 70 00:04:30,360 --> 00:04:35,200 Speaker 1: that this particular announcement will someday be saying as a 71 00:04:35,320 --> 00:04:40,159 Speaker 1: historic moment of America reaching into space. America is setting 72 00:04:40,240 --> 00:04:43,200 Speaker 1: up a bold program, and America is saying to the 73 00:04:43,200 --> 00:04:48,600 Speaker 1: world space should be free, not controlled by dictatorships. And 74 00:04:48,640 --> 00:04:51,039 Speaker 1: we're going to work with all of our allies to 75 00:04:51,120 --> 00:04:54,400 Speaker 1: make sure that we can have a space program that 76 00:04:54,520 --> 00:04:58,280 Speaker 1: actually in the next ten or fifteen years, is revolutionary 77 00:04:58,760 --> 00:05:01,800 Speaker 1: in its impact and in the opportunity that it's going 78 00:05:01,839 --> 00:05:06,839 Speaker 1: to create. Coming up, Michael Falcon, who is the co 79 00:05:07,040 --> 00:05:11,320 Speaker 1: chair of American Prosperity at the American First Policy Institute, 80 00:05:11,600 --> 00:05:14,320 Speaker 1: going to join me to discuss the same court's ruling 81 00:05:14,640 --> 00:05:24,400 Speaker 1: on President from tariffs. I am really pleased to welcome 82 00:05:24,440 --> 00:05:29,120 Speaker 1: my guest, Michael falk Under, co Chair of American Prosperity 83 00:05:29,560 --> 00:05:32,840 Speaker 1: at the America First Policy Institute and the William E. 84 00:05:33,080 --> 00:05:36,840 Speaker 1: Longbreak Share of Finance at the Smith's School of Business 85 00:05:37,120 --> 00:05:41,080 Speaker 1: at the University of Maryland. He served as the sixteenth 86 00:05:41,440 --> 00:05:45,800 Speaker 1: Deputy Secretary of the US Treasury from March to August 87 00:05:46,040 --> 00:05:50,360 Speaker 1: twenty twenty five. Michael, welcome, and thank you for joining 88 00:05:50,400 --> 00:05:51,440 Speaker 1: me on this world. 89 00:05:51,680 --> 00:05:53,320 Speaker 2: It's great to be with you, mister speaker. 90 00:05:54,000 --> 00:05:57,240 Speaker 1: So on February twentieth, the Supreme Court of the United 91 00:05:57,279 --> 00:06:01,320 Speaker 1: States ruled six to three the President and Trump could 92 00:06:01,320 --> 00:06:06,480 Speaker 1: not use the International Emergency Economics Powers Act to impose tariffs. 93 00:06:07,880 --> 00:06:09,800 Speaker 1: Why is this ruling so significant? 94 00:06:10,920 --> 00:06:14,120 Speaker 2: The ruling is significant because it reduces the ability of 95 00:06:14,160 --> 00:06:19,120 Speaker 2: the President to have more flexibility in his application of tariffs, 96 00:06:19,160 --> 00:06:23,760 Speaker 2: as both he and Secretary Bustin have discussed. Broadly speaking, 97 00:06:23,760 --> 00:06:27,200 Speaker 2: tariffs serve three purposes. In the long run, they are 98 00:06:27,240 --> 00:06:31,640 Speaker 2: meant to create a better incentive environment for manufacturing to 99 00:06:31,760 --> 00:06:34,839 Speaker 2: return to the United States, which has not just economic 100 00:06:34,839 --> 00:06:39,440 Speaker 2: security implications, but national security implications. Number two, they do 101 00:06:39,560 --> 00:06:43,080 Speaker 2: generate revenue in the short and intermediate run, and number three, 102 00:06:43,600 --> 00:06:47,599 Speaker 2: they generate leverage for the president to engage in negotiations 103 00:06:47,640 --> 00:06:51,880 Speaker 2: over a variety of geopolitical issues. And so, while there 104 00:06:51,880 --> 00:06:55,560 Speaker 2: are a number of other authorities at the president's disposal 105 00:06:55,720 --> 00:06:58,200 Speaker 2: under different laws that Congress has passed over the years, 106 00:06:59,040 --> 00:07:02,360 Speaker 2: the AIPA authority was viewed to be the most flexible 107 00:07:02,839 --> 00:07:07,159 Speaker 2: and from a timing consideration, it allows the president to 108 00:07:07,200 --> 00:07:10,560 Speaker 2: implement them immediately, where some of the other authorities require 109 00:07:10,920 --> 00:07:16,320 Speaker 2: investigations prior to their utilization. So the Supreme Court decision 110 00:07:16,640 --> 00:07:19,840 Speaker 2: does not take away the president's ability to use tariffs 111 00:07:19,840 --> 00:07:23,920 Speaker 2: for achieving those things. It just creates more steps, more 112 00:07:24,000 --> 00:07:28,720 Speaker 2: bureaucracy in order to utilize teriffs to achieve those important goals. 113 00:07:29,520 --> 00:07:34,320 Speaker 1: These cases were brought by small businesses. An educational toy 114 00:07:34,400 --> 00:07:38,240 Speaker 1: company and a family owned wine importer both said that 115 00:07:38,560 --> 00:07:43,040 Speaker 1: tariffs would negatively affect their business. In your judgment, how 116 00:07:43,120 --> 00:07:47,480 Speaker 1: important are these kind of real world impacts in shaping 117 00:07:47,520 --> 00:07:48,240 Speaker 1: a case like. 118 00:07:48,200 --> 00:07:52,520 Speaker 2: This, I think it's important to balance kind of the 119 00:07:52,560 --> 00:07:55,280 Speaker 2: implications that the tariffs are going to have. So, as 120 00:07:55,320 --> 00:07:59,640 Speaker 2: I said, for importers, it is potentially going to raise 121 00:07:59,760 --> 00:08:03,360 Speaker 2: their cost structure because to the extent that the foreign 122 00:08:03,400 --> 00:08:07,440 Speaker 2: producer doesn't entirely absorb them. They have to be paid 123 00:08:07,560 --> 00:08:10,960 Speaker 2: either by the domestic retailer or they have to be 124 00:08:11,000 --> 00:08:13,800 Speaker 2: passed on to the consumer. And we know that because 125 00:08:13,800 --> 00:08:16,120 Speaker 2: of a lot of the policies of the Biden administration, 126 00:08:16,600 --> 00:08:21,480 Speaker 2: there has been an affordability crisis for the middle class 127 00:08:21,480 --> 00:08:24,480 Speaker 2: in the United States, and so there's an enormous desire 128 00:08:24,560 --> 00:08:27,520 Speaker 2: not to pass those on and exacerbate it, and so 129 00:08:28,040 --> 00:08:31,400 Speaker 2: to the extent that domestic retailers bear it, that can 130 00:08:31,440 --> 00:08:35,079 Speaker 2: be problematic in the short run. Again, what the President's 131 00:08:35,120 --> 00:08:37,600 Speaker 2: trying to do, though, is say, look, we have these 132 00:08:37,679 --> 00:08:44,040 Speaker 2: vulnerabilities that foreign countries have abused their trading position. They 133 00:08:44,040 --> 00:08:47,760 Speaker 2: have enacted trade barriers in the form of practices, they 134 00:08:47,800 --> 00:08:51,079 Speaker 2: engage in subsidies that are not allowed under the WTO, 135 00:08:51,559 --> 00:08:54,920 Speaker 2: They have imposed their own terror regimes, and the United 136 00:08:54,960 --> 00:08:58,320 Speaker 2: States really does, in order to maintain competition, need to 137 00:08:58,320 --> 00:09:01,319 Speaker 2: push back and likewise used tersh Now, rather than us 138 00:09:01,880 --> 00:09:05,560 Speaker 2: enacting a bunch of non tariff barriers ourselves, what they're 139 00:09:05,559 --> 00:09:08,880 Speaker 2: looking to do is offset them with tariffs and ultimately 140 00:09:09,240 --> 00:09:12,480 Speaker 2: negotiate with these countries to bring down their own non 141 00:09:12,520 --> 00:09:14,520 Speaker 2: tariff barrier. So what do I mean by that for 142 00:09:14,559 --> 00:09:16,480 Speaker 2: those of you that are not in kind of this 143 00:09:16,760 --> 00:09:21,559 Speaker 2: international trade space. Oftentimes, for instance, if you do business 144 00:09:21,559 --> 00:09:24,520 Speaker 2: in China, you have to bring in a Chinese partner 145 00:09:24,559 --> 00:09:28,240 Speaker 2: so that they can profit from your knowledge, from your 146 00:09:28,320 --> 00:09:33,840 Speaker 2: intellectual property. They impose restrictions on activities that foreign companies 147 00:09:33,840 --> 00:09:36,120 Speaker 2: can do that we don't impose on foreign companies when 148 00:09:36,120 --> 00:09:39,480 Speaker 2: they come into our markets. They require the sharing of 149 00:09:39,960 --> 00:09:44,480 Speaker 2: intellectual property like patent information and trade secrets that we 150 00:09:44,559 --> 00:09:48,480 Speaker 2: don't require. And also they've been subsidizing those activities in 151 00:09:48,600 --> 00:09:53,960 Speaker 2: order to give their manufacturers advantages that other countries don't have. 152 00:09:54,640 --> 00:09:57,000 Speaker 2: And the major problem on that, and we really saw 153 00:09:57,040 --> 00:10:01,000 Speaker 2: it with things like magnets and critical minis roles last year. 154 00:10:01,320 --> 00:10:05,320 Speaker 2: We saw it with personal protective equipment during COVID, is 155 00:10:05,360 --> 00:10:10,200 Speaker 2: that countries like China are willing to use their provision 156 00:10:10,440 --> 00:10:15,200 Speaker 2: of these goods in order to extract geopolitical concession. So 157 00:10:15,200 --> 00:10:18,760 Speaker 2: they're willing to engage to some extent in economic warfare 158 00:10:19,000 --> 00:10:22,439 Speaker 2: through these subsidies and barriers, and so long term, the 159 00:10:22,520 --> 00:10:26,760 Speaker 2: United States absolutely has to change the power structure of 160 00:10:27,040 --> 00:10:30,040 Speaker 2: the West vis a vis China and Tarifshire. Way to 161 00:10:30,080 --> 00:10:32,320 Speaker 2: do it but you know, there is an acknowledgment that 162 00:10:32,480 --> 00:10:36,800 Speaker 2: in the process, some companies in some industries are going 163 00:10:36,880 --> 00:10:39,680 Speaker 2: to face, you know, a higher cost structure while that 164 00:10:39,720 --> 00:10:40,720 Speaker 2: transition goes on. 165 00:10:41,520 --> 00:10:49,320 Speaker 1: In that context, the President clearly was trying to profoundly 166 00:10:49,440 --> 00:10:52,960 Speaker 1: change the pattern which you'd grown up since World War Two, 167 00:10:53,720 --> 00:10:58,160 Speaker 1: and phil that it was very much to the disadvantage 168 00:10:58,160 --> 00:11:01,240 Speaker 1: of the United States, that other intries were taking advantage 169 00:11:01,280 --> 00:11:04,440 Speaker 1: of us, and that they had gradually crippled a number 170 00:11:04,440 --> 00:11:08,040 Speaker 1: of American industries by a variety of methods of cheating. 171 00:11:08,600 --> 00:11:12,520 Speaker 1: And yet the court came back and reason that Article one, 172 00:11:13,080 --> 00:11:17,040 Speaker 1: section eight of the Constitution vests the power to lay 173 00:11:17,040 --> 00:11:22,120 Speaker 1: and collect taxes, duties, imposts, and exercises in congress alone. 174 00:11:22,360 --> 00:11:25,480 Speaker 1: Is this the court saying that tariffs are essentially a 175 00:11:25,480 --> 00:11:30,200 Speaker 1: congressional power even in a situation where a president claims 176 00:11:30,520 --> 00:11:34,640 Speaker 1: an economic emergency. And how far does that limitation of 177 00:11:34,679 --> 00:11:35,440 Speaker 1: the presidency go? 178 00:11:36,720 --> 00:11:40,599 Speaker 2: It is the Court saying that at least under AEPA, 179 00:11:41,000 --> 00:11:46,000 Speaker 2: so under the International Emergency Economic Powers Act, that while 180 00:11:46,040 --> 00:11:51,000 Speaker 2: it provided for regulatory relief in the case of declared 181 00:11:51,040 --> 00:11:56,400 Speaker 2: economic emergencies by the president, the majority found that tariffs 182 00:11:56,559 --> 00:12:01,960 Speaker 2: were not part of said regulatory relief. Again, what the 183 00:12:01,960 --> 00:12:06,200 Speaker 2: Court also said is that in other situations, Congress has 184 00:12:06,400 --> 00:12:11,000 Speaker 2: delegated tariff authority to the president. So, for instance, there's 185 00:12:11,000 --> 00:12:14,400 Speaker 2: section three oh one, there's Section two thirty two. So 186 00:12:14,640 --> 00:12:19,840 Speaker 2: if there are trade abuses, if there are national security issues, 187 00:12:20,240 --> 00:12:25,000 Speaker 2: there are other mechanisms that the Court recognizes where Congress 188 00:12:25,040 --> 00:12:28,559 Speaker 2: has delegated that authority. But there are greater limitations. There 189 00:12:28,600 --> 00:12:33,480 Speaker 2: are greater bureaucratic processes that are required in those more 190 00:12:33,679 --> 00:12:37,840 Speaker 2: limited instances that make it more difficult for the president 191 00:12:37,880 --> 00:12:40,600 Speaker 2: to utilize this authority. So the Court did not say 192 00:12:40,640 --> 00:12:43,440 Speaker 2: that the president has no authority on tariff's What the 193 00:12:43,480 --> 00:12:46,280 Speaker 2: Court said is that the authority is not so broad 194 00:12:46,440 --> 00:12:49,720 Speaker 2: as he was asserting under AEPA. It's more limited to 195 00:12:49,800 --> 00:12:53,719 Speaker 2: the cases under other statutes like section two thirty two, 196 00:12:53,840 --> 00:12:57,959 Speaker 2: like section three oh one, that more prescribe the delegation. 197 00:13:00,000 --> 00:13:03,880 Speaker 1: Come back, we're going to talk about what happens to 198 00:13:04,000 --> 00:13:13,800 Speaker 1: the billions of dollars that was already collected. As you know, 199 00:13:14,080 --> 00:13:16,720 Speaker 1: because you're an expert in this area. In the United 200 00:13:16,720 --> 00:13:21,320 Speaker 1: States versus United States Shoe Corporation back in nineteen ninety eight, 201 00:13:21,679 --> 00:13:25,319 Speaker 1: the Supreme Court struck down the harbor maintenance tax as 202 00:13:25,360 --> 00:13:30,040 Speaker 1: applied to exports ruling and violated the Constitution's export Clause. 203 00:13:30,840 --> 00:13:34,920 Speaker 1: They then required the US Custom Service to refund over 204 00:13:34,960 --> 00:13:39,439 Speaker 1: seven hundred million dollars in what, in retrospect was illegally 205 00:13:39,440 --> 00:13:43,959 Speaker 1: collected taxes, and litigation over repayments from that nineteen ninety 206 00:13:43,960 --> 00:13:48,160 Speaker 1: eight decision continued well into the early two thousands. So 207 00:13:48,280 --> 00:13:53,320 Speaker 1: now you have justice. Kevanaugh raised the possibility that the 208 00:13:53,440 --> 00:13:58,200 Speaker 1: US could have to refund billions of dollars to importers. 209 00:13:58,679 --> 00:14:01,480 Speaker 1: What is your sense of how realistic that is. 210 00:14:02,720 --> 00:14:06,920 Speaker 2: In terms of the process. I was at Treasury during 211 00:14:07,480 --> 00:14:12,360 Speaker 2: COVID under Secretary Manuch, and I saw the lengths that 212 00:14:12,400 --> 00:14:15,720 Speaker 2: we were able to go to to get economic impact 213 00:14:15,760 --> 00:14:19,480 Speaker 2: payments out to about one hundred and forty million households. 214 00:14:19,840 --> 00:14:23,720 Speaker 2: And so when called upon under the leadership of somebody 215 00:14:23,800 --> 00:14:27,040 Speaker 2: likes Secretary bust And, I have full faith in the 216 00:14:27,080 --> 00:14:29,960 Speaker 2: ability of Treasury to work with Customs and Border Patrol 217 00:14:30,400 --> 00:14:33,280 Speaker 2: to implement a refund system. I'm not saying it's going 218 00:14:33,320 --> 00:14:36,640 Speaker 2: to be seamless, but if that ultimately is what is 219 00:14:36,760 --> 00:14:40,480 Speaker 2: ordered by the court, I have full confidence in the 220 00:14:40,520 --> 00:14:44,000 Speaker 2: professionals at Treasury and DHS to be able to put 221 00:14:44,040 --> 00:14:48,480 Speaker 2: in places system. It's not ideal. Having seen the ability 222 00:14:48,520 --> 00:14:52,720 Speaker 2: of Treasury to implement these kinds of one time payment systems, 223 00:14:52,720 --> 00:14:54,800 Speaker 2: I know that they're going to be able to do it, So. 224 00:14:54,880 --> 00:14:58,680 Speaker 1: You think they would avoid the kind of litigation nightmare. 225 00:15:00,120 --> 00:15:01,640 Speaker 1: We have thousands of lawsuits. 226 00:15:02,280 --> 00:15:04,480 Speaker 2: I think that it's going to be tested in the 227 00:15:04,520 --> 00:15:07,880 Speaker 2: courts as to whether or not refunds are required in 228 00:15:07,960 --> 00:15:12,440 Speaker 2: all of these situations. But ultimately, if the court finds 229 00:15:12,520 --> 00:15:15,520 Speaker 2: that refunds are going to be required, I have full 230 00:15:15,560 --> 00:15:19,040 Speaker 2: confidence in Treasury and CBP's ability to put together such 231 00:15:19,040 --> 00:15:19,520 Speaker 2: a system. 232 00:15:20,360 --> 00:15:25,000 Speaker 1: The Tax Foundation estimas is over one hundred and sixty 233 00:15:25,120 --> 00:15:28,360 Speaker 1: billion dollars that was collective into these TIFFs, and the 234 00:15:28,440 --> 00:15:31,000 Speaker 1: pen Work and Budget model says it could be as 235 00:15:31,040 --> 00:15:33,680 Speaker 1: high as one hundred and seventy five billion. Do we 236 00:15:33,800 --> 00:15:36,360 Speaker 1: just write the checks? How do you handle sending out 237 00:15:36,360 --> 00:15:37,240 Speaker 1: that much cash? 238 00:15:37,440 --> 00:15:39,200 Speaker 2: Yeah? I mean that is exactly going to be. The 239 00:15:39,240 --> 00:15:43,480 Speaker 2: problem is it is going to raise the budget deficit 240 00:15:43,560 --> 00:15:45,880 Speaker 2: this year by the amount of the refunds because it 241 00:15:46,000 --> 00:15:49,400 Speaker 2: was unanticipated, So it's going to increase the amount of 242 00:15:49,440 --> 00:15:52,720 Speaker 2: debt that Treasury is going to have to raise We're 243 00:15:52,760 --> 00:15:55,560 Speaker 2: already running a one point seventy one point eight trillion 244 00:15:55,600 --> 00:15:58,360 Speaker 2: dollar budget deficit, and so the amount of the refunds 245 00:15:58,400 --> 00:16:00,360 Speaker 2: that would have to be processed is just going to 246 00:16:00,360 --> 00:16:04,560 Speaker 2: come out of additional deficit spending. So it'll increase the 247 00:16:04,600 --> 00:16:07,680 Speaker 2: work that has to be done on those debt auctions. 248 00:16:07,960 --> 00:16:13,640 Speaker 2: But again creating a payment system. Treasury processes nearly seven 249 00:16:13,720 --> 00:16:17,280 Speaker 2: trillion dollars a year in payments, so adding another one 250 00:16:17,360 --> 00:16:21,000 Speaker 2: hundred and seventy five billion, they'll know how to process it. 251 00:16:21,000 --> 00:16:22,880 Speaker 2: It's just that, you know, it's just going to increase 252 00:16:22,920 --> 00:16:25,440 Speaker 2: the deficit, and it's just going to bring us that 253 00:16:25,560 --> 00:16:28,680 Speaker 2: much closer to when are we going to face some 254 00:16:28,800 --> 00:16:32,400 Speaker 2: kind of fiscal consequence for the out of control budget 255 00:16:32,400 --> 00:16:35,320 Speaker 2: deficits that we didn't have when you were speaker. 256 00:16:35,960 --> 00:16:38,800 Speaker 1: When you think about the scale of the numbers you're describing, 257 00:16:39,640 --> 00:16:45,600 Speaker 1: the Treasury handles seven trillion dollars a year, that's staying. 258 00:16:46,240 --> 00:16:49,640 Speaker 1: I've sort of stunned just thinking about the scale of 259 00:16:49,920 --> 00:16:52,840 Speaker 1: how we have evolved and how we have grown. I 260 00:16:52,920 --> 00:16:57,520 Speaker 1: gather that the courts have been pretty tough. That Justice 261 00:16:57,520 --> 00:17:00,800 Speaker 1: to and edk Federal Circuit to hold off for ninety 262 00:17:00,880 --> 00:17:03,880 Speaker 1: days about how to do this, and the judges said no, 263 00:17:04,760 --> 00:17:09,040 Speaker 1: So apparently they're trying to put pressure to actually maximize 264 00:17:09,520 --> 00:17:10,800 Speaker 1: the speed of the refunds. 265 00:17:11,680 --> 00:17:13,800 Speaker 2: Yeah, there are a lot of things going on at 266 00:17:13,800 --> 00:17:16,760 Speaker 2: Treasury at the same time. We are heavy into filing 267 00:17:16,800 --> 00:17:20,280 Speaker 2: season right now, so the IRS is also very busy collecting. 268 00:17:20,640 --> 00:17:23,280 Speaker 2: The IRS collects more than five trillion dollars a year 269 00:17:23,480 --> 00:17:26,679 Speaker 2: in receipts, so again adding to the staggering amounts that 270 00:17:27,240 --> 00:17:31,320 Speaker 2: Treasury overseas on a regular basis, So it's going to 271 00:17:31,400 --> 00:17:34,880 Speaker 2: just add to the additional requirements that the US Treasury 272 00:17:34,920 --> 00:17:39,120 Speaker 2: engages in. Fortunately, there's been a lot of evolution in payments. 273 00:17:39,320 --> 00:17:42,680 Speaker 2: It's fascinating to see we have largely gone away from 274 00:17:42,760 --> 00:17:45,720 Speaker 2: processing by checks. Not to get too far off track, 275 00:17:45,800 --> 00:17:48,000 Speaker 2: but one of the biggest problems that we have in 276 00:17:48,040 --> 00:17:50,920 Speaker 2: the banking sector right now is the amount of counterfeit 277 00:17:50,960 --> 00:17:53,720 Speaker 2: government checks that are being issued, and so Treasury is 278 00:17:53,760 --> 00:17:56,399 Speaker 2: making great strides to move to other forms of payment 279 00:17:56,440 --> 00:17:59,680 Speaker 2: system so things like direct deposits and other forms of 280 00:17:59,680 --> 00:18:03,480 Speaker 2: payment in order to increase the capacity of Treasury to 281 00:18:03,680 --> 00:18:06,439 Speaker 2: conduct all of these payments. When we were doing checks, 282 00:18:06,480 --> 00:18:09,639 Speaker 2: there's a limit on the physical ability of Treasury to 283 00:18:09,680 --> 00:18:13,800 Speaker 2: process checks on a weekly basis. That's why whenever Treasury 284 00:18:13,840 --> 00:18:16,840 Speaker 2: conducts refunds, they have to be rolled out over a 285 00:18:16,920 --> 00:18:20,600 Speaker 2: number of weeks because you'd hit a capacity constraint, Whereas 286 00:18:20,760 --> 00:18:23,600 Speaker 2: if we can move it to things like ach and 287 00:18:23,640 --> 00:18:26,080 Speaker 2: if we can move it to EBT cards, we can 288 00:18:26,119 --> 00:18:29,399 Speaker 2: actually process them a lot more quickly. So the capacity 289 00:18:29,440 --> 00:18:32,960 Speaker 2: exists because the private sector has created all these new 290 00:18:33,040 --> 00:18:35,919 Speaker 2: payment mechanisms. But it's just as you said, it's just 291 00:18:35,960 --> 00:18:38,480 Speaker 2: a staggering amount of money that has to be processed. 292 00:18:38,960 --> 00:18:43,520 Speaker 1: Trump is a very persistent and resilient guy, so he 293 00:18:43,560 --> 00:18:46,840 Speaker 1: immediately pivoted, and I'm sure that he and Besson had 294 00:18:46,880 --> 00:18:49,640 Speaker 1: already caught this through before it happened, And he immediately 295 00:18:49,640 --> 00:18:54,120 Speaker 1: pivoted and invoked the nineteen seventy four Trade Act, which 296 00:18:54,160 --> 00:18:57,159 Speaker 1: allowed him to impose a ten percent tariff, something no 297 00:18:57,200 --> 00:19:00,440 Speaker 1: president ever done before. And he's apparently looking for other 298 00:19:00,920 --> 00:19:04,160 Speaker 1: mechanisms that he could argue or legal to do this. 299 00:19:04,560 --> 00:19:08,640 Speaker 1: What was your reaction to invoking the seventy four Act 300 00:19:08,680 --> 00:19:12,080 Speaker 1: in imposing the ten percent here of I. 301 00:19:12,040 --> 00:19:15,600 Speaker 2: Was not surprised, because ultimately the president's view is that 302 00:19:15,720 --> 00:19:18,879 Speaker 2: in order to counter some of these unfair trade practices that, 303 00:19:18,960 --> 00:19:22,200 Speaker 2: as you said, have been going on for decades. We 304 00:19:22,280 --> 00:19:25,240 Speaker 2: need to make up for it by putting a minimum 305 00:19:25,359 --> 00:19:29,280 Speaker 2: teriff right around the country and then industry by industry 306 00:19:29,320 --> 00:19:33,080 Speaker 2: and country by country addressing some of the unfair practices 307 00:19:33,080 --> 00:19:36,399 Speaker 2: that have persisted for decades. As I indicated, there was 308 00:19:36,440 --> 00:19:39,120 Speaker 2: always as soon as the first District Court came out 309 00:19:39,160 --> 00:19:43,880 Speaker 2: and said that utilizing AIPA may run into constitutional issues, 310 00:19:44,240 --> 00:19:47,320 Speaker 2: there was already work underway to see what other authorities 311 00:19:47,480 --> 00:19:50,120 Speaker 2: could be called upon in the time frame and process 312 00:19:50,200 --> 00:19:54,280 Speaker 2: for implementing them, and so they used section one twenty 313 00:19:54,320 --> 00:19:56,639 Speaker 2: two of the Trade Act from nineteen seventy four that 314 00:19:56,680 --> 00:19:59,399 Speaker 2: you reference. He originally took it to ten, then bumped 315 00:19:59,400 --> 00:20:01,760 Speaker 2: it up to fifteen, because that's what's allowed under that 316 00:20:01,840 --> 00:20:04,360 Speaker 2: provision up to one hundred and fifty days. And what 317 00:20:04,400 --> 00:20:07,480 Speaker 2: that does is advise both the Commerce Department and the 318 00:20:07,560 --> 00:20:10,919 Speaker 2: US Trade Representative's Office that one hundred and fifty days 319 00:20:10,960 --> 00:20:15,720 Speaker 2: to do the industry by industry or product by product evaluations, 320 00:20:16,080 --> 00:20:19,280 Speaker 2: to invoke two thirty two and three oh one again 321 00:20:19,520 --> 00:20:21,639 Speaker 2: other provisions of other trade authorities. 322 00:20:22,240 --> 00:20:26,440 Speaker 1: If countries come in and voluntarily agree to a trade deal. 323 00:20:27,119 --> 00:20:29,119 Speaker 1: That's pretty much automatically okay, isn't it. 324 00:20:30,160 --> 00:20:32,440 Speaker 2: Well, what they have agreed to so far, I would 325 00:20:32,480 --> 00:20:35,520 Speaker 2: describe them as term sheets. They are not full blown 326 00:20:35,600 --> 00:20:39,639 Speaker 2: trade treaties that have gone into effect. Right, so the 327 00:20:39,720 --> 00:20:42,720 Speaker 2: leaders have agreed to the overall parameters. Once you have 328 00:20:42,800 --> 00:20:46,080 Speaker 2: those executive agreements in place, then yes, they would move 329 00:20:46,119 --> 00:20:50,680 Speaker 2: away from these broader teriff authorities instead to an implementation 330 00:20:50,920 --> 00:20:52,360 Speaker 2: under one of those agreements. 331 00:20:52,760 --> 00:20:55,600 Speaker 1: Does that require centered approval or is that sort of 332 00:20:55,680 --> 00:20:56,400 Speaker 1: pre approved? 333 00:20:57,119 --> 00:20:59,600 Speaker 2: You know? This is one of those murky areas because, 334 00:21:00,119 --> 00:21:02,600 Speaker 2: as we have seen with things as simple as just 335 00:21:02,760 --> 00:21:07,240 Speaker 2: funding TSA agents, the Senate is entirely dysfunctional, and so 336 00:21:07,600 --> 00:21:10,840 Speaker 2: presidents of both parties have moved towards things like executive 337 00:21:10,880 --> 00:21:16,880 Speaker 2: agreements rather than taking them through tax treaties or trade treaties. Unfortunately, 338 00:21:16,920 --> 00:21:19,080 Speaker 2: what that does is it means that they only endure 339 00:21:19,119 --> 00:21:21,439 Speaker 2: as long as that chief executive is in office and 340 00:21:21,520 --> 00:21:24,600 Speaker 2: can be undone by the next one. So ultimately it 341 00:21:24,640 --> 00:21:27,600 Speaker 2: would be great if these things could run through a 342 00:21:27,760 --> 00:21:30,840 Speaker 2: Congress that was actually receptive to doing its job. 343 00:21:31,320 --> 00:21:34,919 Speaker 1: And your judgment was this ruling by the Supreme Court 344 00:21:35,520 --> 00:21:38,879 Speaker 1: a major turning point for US trade policy or just 345 00:21:38,920 --> 00:21:39,800 Speaker 1: a bump in the road. 346 00:21:40,520 --> 00:21:42,400 Speaker 2: To me, it's entirely a bump in the road. When 347 00:21:42,440 --> 00:21:45,360 Speaker 2: I have talked to foreign governments, when I've talked to companies, 348 00:21:45,640 --> 00:21:48,800 Speaker 2: what I have told them is, don't focus on the process. 349 00:21:49,280 --> 00:21:52,359 Speaker 2: Focus on the president's trade agenda. He is going to 350 00:21:52,480 --> 00:21:56,600 Speaker 2: find authorities in order to implement his view of what 351 00:21:56,640 --> 00:21:59,760 Speaker 2: the trade structure should be, which is kind of a 352 00:22:00,000 --> 00:22:03,640 Speaker 2: ten percent tariff on all goods and services that come in, 353 00:22:04,200 --> 00:22:08,520 Speaker 2: and then incremental tariffs for countries and industries of national 354 00:22:08,520 --> 00:22:11,240 Speaker 2: security or to the extent that they have abused their 355 00:22:11,280 --> 00:22:15,520 Speaker 2: trade practices. He's going to then implement higher TIFFs product 356 00:22:15,560 --> 00:22:18,320 Speaker 2: by product or country by country for those reasons. That 357 00:22:18,440 --> 00:22:23,040 Speaker 2: will be the outcome, what trade authority he calls on, 358 00:22:23,119 --> 00:22:26,879 Speaker 2: and what bureaucratic process he needs to engage in. That's 359 00:22:26,960 --> 00:22:30,520 Speaker 2: just in the weeds. Details coming up. 360 00:22:30,720 --> 00:22:35,320 Speaker 1: I'm going to discuss with you housing affordability and why 361 00:22:35,400 --> 00:22:43,520 Speaker 1: the median age of first time home buyers is now forty. 362 00:22:45,560 --> 00:22:49,280 Speaker 1: You're so broadly knowledgeable, and the work you're doing with 363 00:22:49,359 --> 00:22:53,480 Speaker 1: the America First Policy Institutions really been very important in 364 00:22:53,800 --> 00:22:57,320 Speaker 1: trying to figure out how we get back to affordable prosperity. 365 00:22:57,920 --> 00:23:01,960 Speaker 1: So can you sort of help us understand what's been 366 00:23:02,040 --> 00:23:06,680 Speaker 1: happening with the housing market and with first time home buyers. 367 00:23:07,720 --> 00:23:10,600 Speaker 2: Sure, the fundamental issue is that, or the fact that 368 00:23:10,680 --> 00:23:13,480 Speaker 2: I start with in this topic is over the term 369 00:23:13,520 --> 00:23:18,080 Speaker 2: of the Biden administration, the monthly payment of the median 370 00:23:18,200 --> 00:23:23,240 Speaker 2: priced house in the United States doubled. So if you 371 00:23:23,280 --> 00:23:26,399 Speaker 2: think about just take the median price house across the 372 00:23:26,560 --> 00:23:30,320 Speaker 2: entire country and then calculate what would be the required 373 00:23:30,640 --> 00:23:34,600 Speaker 2: mortgage payment on a thirty year fixed rate mortgage that 374 00:23:35,040 --> 00:23:39,240 Speaker 2: doubled in cost over the four years of Biden. Some 375 00:23:39,320 --> 00:23:41,679 Speaker 2: of that is that house prices continue to go up 376 00:23:41,760 --> 00:23:44,080 Speaker 2: during the Biden administration for a few reasons. I'm going 377 00:23:44,119 --> 00:23:46,359 Speaker 2: to explain in a minute. The bulk of it came 378 00:23:46,440 --> 00:23:50,440 Speaker 2: from the higher interest rate environment. So the interest rate 379 00:23:50,440 --> 00:23:53,120 Speaker 2: on thirty year mortgages went from three and a half 380 00:23:53,160 --> 00:23:55,280 Speaker 2: percent roughly to six and a half percent, and that 381 00:23:55,320 --> 00:23:59,840 Speaker 2: constitutes the largest portion of it. So what do we 382 00:23:59,880 --> 00:24:02,480 Speaker 2: do about each of those pieces? Well, Secretary best And 383 00:24:02,640 --> 00:24:07,199 Speaker 2: from day one has said his primary objective is to 384 00:24:07,240 --> 00:24:09,280 Speaker 2: get the ten year interest rate down, the ten year 385 00:24:09,359 --> 00:24:15,040 Speaker 2: treasury rate down. Why, because that's the benchmark yield that 386 00:24:15,119 --> 00:24:18,480 Speaker 2: mortgages are priced off of. So bringing down the ten 387 00:24:18,560 --> 00:24:21,640 Speaker 2: year interest rate on treasuries is not just about lowering 388 00:24:21,680 --> 00:24:26,160 Speaker 2: borrowing costs for the treasury, but it lowers borrowing costs 389 00:24:26,160 --> 00:24:29,440 Speaker 2: for home buyers. So you've got to absolutely bring that down. 390 00:24:29,600 --> 00:24:31,840 Speaker 2: How do you do it. You put in place better 391 00:24:31,840 --> 00:24:35,119 Speaker 2: fiscal policies, You get our budget situation under control, and 392 00:24:35,119 --> 00:24:39,120 Speaker 2: that's why Secretary Busin has called for getting deficits down 393 00:24:39,119 --> 00:24:44,080 Speaker 2: to three percent of GDP, because once budget deficits become sustainable, 394 00:24:44,480 --> 00:24:47,320 Speaker 2: that puts confidence into the bond market that the US 395 00:24:47,400 --> 00:24:49,439 Speaker 2: is going to get its fiscal house in order and 396 00:24:49,560 --> 00:24:52,000 Speaker 2: keep it there, and that's going to bring down interest 397 00:24:52,040 --> 00:24:55,639 Speaker 2: rates on things like mortgages. At the same time, the 398 00:24:55,720 --> 00:24:57,919 Speaker 2: cost of construction has gone up and we are not 399 00:24:57,920 --> 00:25:01,960 Speaker 2: building anywhere near enough houses in this country. That has 400 00:25:02,160 --> 00:25:05,159 Speaker 2: been true ever since the financial crisis, but it just 401 00:25:05,200 --> 00:25:10,159 Speaker 2: continues to get worse. It very much is divided state 402 00:25:10,200 --> 00:25:12,720 Speaker 2: by state, So there's been some great work that's been 403 00:25:12,760 --> 00:25:16,879 Speaker 2: done looking state by state at what are the costs 404 00:25:16,920 --> 00:25:22,520 Speaker 2: of permitting and zoning and regulation at the state and 405 00:25:22,560 --> 00:25:25,679 Speaker 2: local level. And it will not surprise you that the 406 00:25:25,720 --> 00:25:30,240 Speaker 2: Blue states that have imposed all sorts of requirements on 407 00:25:30,359 --> 00:25:34,760 Speaker 2: home builders, green energy requirements I talk about here in Maryland, 408 00:25:35,160 --> 00:25:37,760 Speaker 2: even if you live right next door to the fire department, 409 00:25:38,359 --> 00:25:40,359 Speaker 2: you've got to have a sprinkler system in your house. 410 00:25:40,440 --> 00:25:43,920 Speaker 2: I mean, all of that adds enormous costs to construction 411 00:25:44,200 --> 00:25:47,200 Speaker 2: that have to be borne by the home buyer, you know. 412 00:25:47,280 --> 00:25:49,400 Speaker 2: And then you look at the massive inflation that took 413 00:25:49,440 --> 00:25:53,800 Speaker 2: place during the Biden administration and just the costs of 414 00:25:54,200 --> 00:25:56,440 Speaker 2: everything have gone up. And then I would say, finally, 415 00:25:56,480 --> 00:25:59,879 Speaker 2: I think a thing that's completely underappreciated. I am among 416 00:25:59,880 --> 00:26:02,720 Speaker 2: them generation of kids that saw classes like wood shop 417 00:26:02,800 --> 00:26:05,480 Speaker 2: and metal shop removed from our high schools, and we 418 00:26:05,600 --> 00:26:09,080 Speaker 2: now don't have anywhere near enough plumbers and electricians. So 419 00:26:09,760 --> 00:26:12,880 Speaker 2: the Trump administration is working on that on all dimensions. 420 00:26:13,480 --> 00:26:16,840 Speaker 2: So looking at how do we encourage states and municipalities 421 00:26:17,160 --> 00:26:20,840 Speaker 2: to reduce their zoning and permitting costs. How do we 422 00:26:21,320 --> 00:26:24,800 Speaker 2: change the education system so that there are more apprenticeship 423 00:26:24,840 --> 00:26:28,359 Speaker 2: programs that we can train plumbers and electricians. How do 424 00:26:28,359 --> 00:26:32,040 Speaker 2: we decrease the cost of every part of home construction 425 00:26:32,600 --> 00:26:35,840 Speaker 2: and increase the supply of homes that are available. So 426 00:26:36,320 --> 00:26:38,800 Speaker 2: I think that there were some steps in both the 427 00:26:38,840 --> 00:26:43,320 Speaker 2: House and the Senate bill to encourage more construction. We 428 00:26:43,359 --> 00:26:45,720 Speaker 2: at AFPI think that there are improvements that could be 429 00:26:45,800 --> 00:26:48,280 Speaker 2: done to the Senate bill, but it would be good 430 00:26:48,320 --> 00:26:52,080 Speaker 2: for us to see a move towards creating greater supply 431 00:26:52,160 --> 00:26:54,359 Speaker 2: of housing in order to bring down the cost of housing. 432 00:26:54,640 --> 00:26:56,000 Speaker 2: And then, like I said, you've got to bring down 433 00:26:56,000 --> 00:26:58,960 Speaker 2: interest rates as well. And that's why if you look 434 00:26:59,000 --> 00:27:00,760 Speaker 2: at the amount of income that you need now to 435 00:27:00,840 --> 00:27:04,520 Speaker 2: pay double the mortgage payment, twenty six year old households 436 00:27:04,520 --> 00:27:05,000 Speaker 2: don't have it. 437 00:27:06,040 --> 00:27:09,480 Speaker 1: I had worked with Jimney Carter on Habitat for Humanity, 438 00:27:10,160 --> 00:27:13,639 Speaker 1: and when we went to San Diego for the Republican 439 00:27:13,760 --> 00:27:17,840 Speaker 1: National Convention in nineteen ninety six, we had this great 440 00:27:17,840 --> 00:27:21,320 Speaker 1: idea that we're going to build a Habitat for Humanity 441 00:27:21,320 --> 00:27:26,119 Speaker 1: house as part of our commitment to helping house the poor. Well, 442 00:27:26,400 --> 00:27:31,359 Speaker 1: by the time we got done the regulatory burden of 443 00:27:31,560 --> 00:27:35,040 Speaker 1: San Diego County in the state of California, we had 444 00:27:35,080 --> 00:27:39,600 Speaker 1: to pay more money for the regulations than we paid 445 00:27:39,640 --> 00:27:43,239 Speaker 1: for the entire house in Georgia. And I think it's 446 00:27:43,320 --> 00:27:45,199 Speaker 1: gotten steadily worse since then. 447 00:27:45,560 --> 00:27:48,000 Speaker 2: The report that we wrote at AFPI says that for 448 00:27:48,080 --> 00:27:51,880 Speaker 2: a four hundred thousand dollars house, about ninety four thousand 449 00:27:51,880 --> 00:27:56,040 Speaker 2: of it is regulatory and permitting costs. 450 00:27:55,280 --> 00:27:59,479 Speaker 1: Which is just crazy. It's part of the ongoing MAGA 451 00:27:59,480 --> 00:28:03,040 Speaker 1: revolution that has to occur because we've accumulated over the 452 00:28:03,119 --> 00:28:07,760 Speaker 1: years so many policies that just aren't working, and it's 453 00:28:07,760 --> 00:28:10,080 Speaker 1: an enormous problem. Do you want to just for a 454 00:28:10,119 --> 00:28:13,880 Speaker 1: minute to share with us how you see the America 455 00:28:13,920 --> 00:28:19,400 Speaker 1: First Policy Institute contributing to the success of reforming America. 456 00:28:19,680 --> 00:28:22,000 Speaker 1: I get to work with you there. I know how 457 00:28:22,040 --> 00:28:24,879 Speaker 1: broad your reach is and how much you know, but 458 00:28:24,960 --> 00:28:28,240 Speaker 1: I think most Americans don't realize that America First Policy 459 00:28:28,280 --> 00:28:33,359 Speaker 1: Institute has really become a significant developer of reforms that 460 00:28:33,400 --> 00:28:34,359 Speaker 1: we desperately need. 461 00:28:35,160 --> 00:28:38,200 Speaker 2: Absolutely so. When we were first created back in twenty 462 00:28:38,280 --> 00:28:40,320 Speaker 2: twenty one, as you know, mister speaker, we created the 463 00:28:40,360 --> 00:28:44,320 Speaker 2: America First Agenda that really was putting down on paper 464 00:28:44,440 --> 00:28:48,040 Speaker 2: the policies, many of which were begun to be implemented 465 00:28:48,120 --> 00:28:51,240 Speaker 2: during the first Trump term, and that helped us in 466 00:28:51,280 --> 00:28:55,600 Speaker 2: the economic side realize what we called the Goldilocks economy, 467 00:28:55,760 --> 00:28:58,200 Speaker 2: the coming of the Golden age that the President talked 468 00:28:58,200 --> 00:29:01,600 Speaker 2: about in the twenty seventeen to twenty nineteen time period. 469 00:29:01,640 --> 00:29:04,160 Speaker 2: You know, as our friend Larry Cablow has talked about 470 00:29:04,240 --> 00:29:08,240 Speaker 2: on numerous occasions, growth was really stagnant for quite a 471 00:29:08,280 --> 00:29:11,960 Speaker 2: lot of the last twenty five years, other than what 472 00:29:12,000 --> 00:29:14,640 Speaker 2: we saw during the first three years of the Trump administration, 473 00:29:15,160 --> 00:29:17,480 Speaker 2: and what we saw with the onset of the pandemic 474 00:29:17,800 --> 00:29:21,560 Speaker 2: was a suspension of those activities because obviously we had 475 00:29:21,600 --> 00:29:24,800 Speaker 2: to address the pandemic, and that when the President left 476 00:29:24,800 --> 00:29:27,200 Speaker 2: office the first time, it was not because the voters 477 00:29:27,560 --> 00:29:30,560 Speaker 2: rejected those policies at all. It was because they were 478 00:29:31,320 --> 00:29:34,680 Speaker 2: tired of the pandemic and Biden promised something that of 479 00:29:34,680 --> 00:29:37,360 Speaker 2: course you could not fulfill, and so he unleashed forty 480 00:29:37,440 --> 00:29:41,560 Speaker 2: year inflation, and the voters ultimately returned the President to 481 00:29:41,680 --> 00:29:44,360 Speaker 2: the White House in order to return us to those 482 00:29:44,560 --> 00:29:48,760 Speaker 2: economic Goldilocks policies that we had, and so AFPI was 483 00:29:48,840 --> 00:29:52,240 Speaker 2: created to put on paper and present to the American 484 00:29:52,280 --> 00:29:56,040 Speaker 2: people and build a coalition around these ideas that first 485 00:29:56,080 --> 00:30:00,480 Speaker 2: inform us the American economy should work for the American Peopleultimately, 486 00:30:00,760 --> 00:30:04,000 Speaker 2: power and authority is vested with the American people, and 487 00:30:04,080 --> 00:30:07,160 Speaker 2: that the government had become way too large, way too costly, 488 00:30:07,240 --> 00:30:10,640 Speaker 2: and was interfering entirely too much in the lives of 489 00:30:10,640 --> 00:30:15,040 Speaker 2: everyday Americans. But that when government does act, it should 490 00:30:15,040 --> 00:30:17,560 Speaker 2: be for the benefit of the American people and stop 491 00:30:17,680 --> 00:30:22,600 Speaker 2: empowering these unelected global institutions that were taking entirely too 492 00:30:22,640 --> 00:30:25,640 Speaker 2: much authority away from the United States and from its 493 00:30:25,640 --> 00:30:29,720 Speaker 2: elected leaders. And so in the economy space, we built 494 00:30:29,760 --> 00:30:33,680 Speaker 2: a program out that I termed Affordable Abundance that really 495 00:30:33,720 --> 00:30:37,560 Speaker 2: focused our work on seven different areas in the economic space. 496 00:30:38,080 --> 00:30:41,720 Speaker 2: So first and foremost it was unleash American energy dominance. 497 00:30:42,080 --> 00:30:45,320 Speaker 2: As you have seen with the war in Iran, if 498 00:30:45,320 --> 00:30:48,760 Speaker 2: we were not a dominant energy supplier, we would be 499 00:30:48,760 --> 00:30:52,000 Speaker 2: confronting much more difficulty as we address some of the 500 00:30:52,000 --> 00:30:55,280 Speaker 2: geopolitical issues. But more than that, energy costs permeate the 501 00:30:55,440 --> 00:30:59,640 Speaker 2: entire economy. Access to low cost energy and free market 502 00:30:59,640 --> 00:31:03,280 Speaker 2: capital have done more to raise people out of poverty 503 00:31:03,360 --> 00:31:08,280 Speaker 2: globally over mankind's history than anything else. And so unleashing 504 00:31:08,360 --> 00:31:12,880 Speaker 2: American energy is an important pillar of the America First strategy. Second, 505 00:31:12,920 --> 00:31:14,400 Speaker 2: as I said, we've got to return power to the 506 00:31:14,400 --> 00:31:17,600 Speaker 2: people in the States through deregulation. Third, we have got 507 00:31:17,640 --> 00:31:20,800 Speaker 2: to bring down just the scale of government has grown 508 00:31:20,840 --> 00:31:25,920 Speaker 2: too large and encompassing, so slashing the inflationary federal spending. Fourth, 509 00:31:25,920 --> 00:31:29,040 Speaker 2: we've got to have a tax environment that encourages growth, 510 00:31:29,040 --> 00:31:33,360 Speaker 2: that encourages entrepreneurship in this country. Fifth, we have got 511 00:31:33,360 --> 00:31:36,560 Speaker 2: to have sound money and sound financial institutions. So we've 512 00:31:36,560 --> 00:31:40,280 Speaker 2: got to get financial institutions back to allocating capital instead 513 00:31:40,320 --> 00:31:43,360 Speaker 2: of all of this DEI compliance that the Biden administration 514 00:31:43,440 --> 00:31:47,000 Speaker 2: and all this climate nonsense that the Biden administration had 515 00:31:47,240 --> 00:31:50,280 Speaker 2: gotten the financial markets and financial institutions to focus on. 516 00:31:50,680 --> 00:31:52,640 Speaker 2: Sixth is just what we were talking about. We have 517 00:31:52,720 --> 00:31:56,440 Speaker 2: got to have a trading environment that is reciprocal and 518 00:31:56,560 --> 00:31:59,880 Speaker 2: fair and that holds countries accountable for their cheating. And 519 00:32:00,120 --> 00:32:03,080 Speaker 2: then seventh, ultimately, we need a healthy America. We need 520 00:32:03,080 --> 00:32:06,120 Speaker 2: a healthy workforce. It's not just that it improves just 521 00:32:06,360 --> 00:32:09,479 Speaker 2: obviously the prosperity and welfare of the American people. It 522 00:32:09,520 --> 00:32:11,760 Speaker 2: also saves us a lot of money if we have 523 00:32:11,800 --> 00:32:15,880 Speaker 2: a health system that's about transparency, that it's about patient 524 00:32:15,880 --> 00:32:19,600 Speaker 2: effectiveness rather than bureaucracy, which is what the Affordable Care 525 00:32:19,640 --> 00:32:22,160 Speaker 2: Act was around. So that's really the way that I 526 00:32:22,200 --> 00:32:25,840 Speaker 2: have thought about structuring the economic plan that we have 527 00:32:25,880 --> 00:32:28,360 Speaker 2: built at AFPI and that we keep making progress on. 528 00:32:28,880 --> 00:32:31,800 Speaker 1: As somebody who believes in the Constitution to what extent 529 00:32:31,920 --> 00:32:36,920 Speaker 1: is all of this severely crippled by the almost absolute 530 00:32:36,960 --> 00:32:39,560 Speaker 1: breakdown of the Senate as an institution. 531 00:32:40,440 --> 00:32:44,800 Speaker 2: It's enormously problematic because so many of these policies that 532 00:32:44,920 --> 00:32:48,280 Speaker 2: the President has sought to implement, he has had to 533 00:32:48,320 --> 00:32:52,680 Speaker 2: resort to executive action rather than getting them into law 534 00:32:52,760 --> 00:32:56,840 Speaker 2: and then causing them to endure beyond his term. And 535 00:32:56,920 --> 00:32:59,920 Speaker 2: so if the Senate were more functional, if we can 536 00:33:00,120 --> 00:33:03,960 Speaker 2: actually get permanent legislation through, and what it means is 537 00:33:03,960 --> 00:33:07,880 Speaker 2: that individuals and businesses can better do long term planning. 538 00:33:07,920 --> 00:33:10,040 Speaker 2: I mean, take again the discussion that we were having 539 00:33:10,080 --> 00:33:14,320 Speaker 2: on trade. We fundamentally need to change the trading system 540 00:33:14,320 --> 00:33:16,400 Speaker 2: and the tariff system that we have around the world 541 00:33:16,720 --> 00:33:19,560 Speaker 2: in light of just the decades of cheating that China 542 00:33:19,560 --> 00:33:23,360 Speaker 2: has engaged in. And I think that there is bipartisan 543 00:33:23,480 --> 00:33:27,120 Speaker 2: consensus around this. I have said many occasion that I 544 00:33:27,200 --> 00:33:31,479 Speaker 2: thought that the House Select Committee on China that was 545 00:33:31,640 --> 00:33:35,040 Speaker 2: overseen by Speaker Johnson in the last Congress was highly 546 00:33:35,080 --> 00:33:37,560 Speaker 2: effective and as a result of the President raising the 547 00:33:37,640 --> 00:33:42,240 Speaker 2: alarm on China has really built a new consensus around 548 00:33:42,320 --> 00:33:44,640 Speaker 2: what we need to do on economic policy and tariff 549 00:33:44,640 --> 00:33:47,600 Speaker 2: policy towards China, and the Senate has been entirely absent. 550 00:33:48,280 --> 00:33:51,959 Speaker 2: Where is the Senate actually implementing policies that are going 551 00:33:52,040 --> 00:33:55,080 Speaker 2: to say we have made a long term, permanent shift 552 00:33:55,120 --> 00:33:56,840 Speaker 2: in the way that we are going to approach economic 553 00:33:56,840 --> 00:34:01,320 Speaker 2: policy towards China, so that businesses have some consistency that 554 00:34:01,400 --> 00:34:04,480 Speaker 2: even when President Trump's term ends, they know that this 555 00:34:04,560 --> 00:34:07,320 Speaker 2: new policy direction is going to stay in place and 556 00:34:07,400 --> 00:34:09,759 Speaker 2: not be undone by the next president that comes in. 557 00:34:10,239 --> 00:34:14,480 Speaker 2: Permanence can only arise if the Senate is actually functional 558 00:34:14,480 --> 00:34:15,719 Speaker 2: and passes legislation. 559 00:34:16,560 --> 00:34:21,160 Speaker 1: I think it's a growing crisis in the American system. Michael, 560 00:34:21,160 --> 00:34:23,960 Speaker 1: I want to thank you for joining me today. You 561 00:34:24,040 --> 00:34:27,680 Speaker 1: are so knowledgeable and your experiences are so deep. I 562 00:34:27,719 --> 00:34:30,359 Speaker 1: always feel like I learned so much from you. Our 563 00:34:30,400 --> 00:34:33,320 Speaker 1: listeners can follow the work you're doing at the America 564 00:34:33,360 --> 00:34:37,920 Speaker 1: First Policy Institute by visiting your website at America First 565 00:34:38,000 --> 00:34:51,600 Speaker 1: policy dot com. And now I'm pleased to introduce a 566 00:34:51,640 --> 00:34:55,080 Speaker 1: new segment to newts World where I answer listener's questions 567 00:34:55,520 --> 00:34:59,120 Speaker 1: to ask a question please email me at newt at 568 00:34:59,160 --> 00:35:05,560 Speaker 1: Yinglis Robert from Telford, Pennsylvania asked why is no one 569 00:35:05,600 --> 00:35:09,439 Speaker 1: talking about creating balanced budgets with surpluses to pay down 570 00:35:09,480 --> 00:35:13,320 Speaker 1: the national debt? Is there a complete lack of political 571 00:35:13,360 --> 00:35:17,640 Speaker 1: will to deal with this critical issue? Sadly, Robert, I 572 00:35:17,840 --> 00:35:20,799 Speaker 1: have to say you put your finger on it. As 573 00:35:20,840 --> 00:35:24,600 Speaker 1: the only Speaker of the House to have authored four 574 00:35:25,400 --> 00:35:29,520 Speaker 1: consecutive balanced budgets in over one hundred years, I know 575 00:35:29,600 --> 00:35:32,880 Speaker 1: it can be done, but I know it's very hard, 576 00:35:33,239 --> 00:35:36,560 Speaker 1: and at the present time people don't seem to have 577 00:35:37,280 --> 00:35:39,440 Speaker 1: a will to create this. I think we're going to 578 00:35:39,840 --> 00:35:43,160 Speaker 1: drift towards a pretty big crisis and you're going to 579 00:35:43,160 --> 00:35:46,279 Speaker 1: see a real change in what the national conversation is. 580 00:35:46,880 --> 00:35:49,520 Speaker 1: But it has not been something President Trump has been 581 00:35:49,560 --> 00:35:51,879 Speaker 1: willing to spend a lot of energy on, and it's 582 00:35:51,920 --> 00:35:55,000 Speaker 1: not something which a majority of members of the House 583 00:35:55,040 --> 00:36:00,200 Speaker 1: and Senate have any optimism about. There are key members who, oh, 584 00:36:00,239 --> 00:36:06,319 Speaker 1: in fact, for example, Senator Ron Johnson of Wisconsin, very 585 00:36:06,440 --> 00:36:09,960 Speaker 1: dedicated to getting back to a balanced budget. Senator Rick 586 00:36:10,040 --> 00:36:15,000 Speaker 1: Scott of Florida very dedicated. But the number of members 587 00:36:15,040 --> 00:36:18,160 Speaker 1: willing to do the really hard work. Having done it, 588 00:36:18,239 --> 00:36:21,760 Speaker 1: I'll tell you it's really hard work has been sadly 589 00:36:22,360 --> 00:36:24,920 Speaker 1: not enough yet to build momentum. But you asked the 590 00:36:24,960 --> 00:36:28,360 Speaker 1: right question. I wish more Americans would ask it. I 591 00:36:28,440 --> 00:36:33,200 Speaker 1: do believe the continued deficit year after year is going 592 00:36:33,200 --> 00:36:36,399 Speaker 1: to presently create a crisis, and at some point we're 593 00:36:36,400 --> 00:36:38,880 Speaker 1: going to have to some people step in with really 594 00:36:38,920 --> 00:36:41,960 Speaker 1: big ideas that get us back to a bounced budget, 595 00:36:42,239 --> 00:36:45,960 Speaker 1: which is what happened in the nineteen nineties. Thank you 596 00:36:46,000 --> 00:36:49,399 Speaker 1: to my guest, Michael Falkender. News World is produced by 597 00:36:49,400 --> 00:36:54,120 Speaker 1: Gengish three sixty and iHeartMedia. Our executive producer is Guernsey Sloan. 598 00:36:54,680 --> 00:36:58,520 Speaker 1: Our researcher is Rachel Peterson. Special thanks to the team 599 00:36:58,560 --> 00:37:01,480 Speaker 1: at Gengish three sixty. If you've been enjoying newts World, 600 00:37:01,760 --> 00:37:04,440 Speaker 1: I hope you'll get Apple Podcast and both rate us 601 00:37:04,440 --> 00:37:07,800 Speaker 1: with five stars and give us a review so others 602 00:37:07,800 --> 00:37:11,160 Speaker 1: can learn what it's all about. Join me on substack 603 00:37:11,560 --> 00:37:16,160 Speaker 1: at gingrishree sixty dot net. I'm Newt Gingrich. This is Newtsworld.