Speaker 1: It's all the people out of job the Democrats are
Speaker 1: using to push What are they pushing for changing the
Speaker 1: emission standards on airplanes? Mister President, What the hell do
Speaker 1: the emission standards on airplanes have to do with thousands
Speaker 1: of people dying and millions of people out of work
Speaker 1: in the Corona coronavirus epidemic. Welcome back to Verdict with
Speaker 1: Ted Cruz. I am Michael Knowles. We have a lot
Speaker 1: to get to. We have to answer that question, what
Speaker 1: the hell do emission standards have to do with coronavirus?
Speaker 1: The Senate has just voted on the coronavirus stimulus package,
Speaker 1: a two trillion dollar package, the largest stimulus in American history.
Speaker 1: It is after midnight on the East Coast and I
Speaker 1: am joined, as ever in the middle of the night
Speaker 1: by one of the Senators who voted on that, Senator Cruz.
Speaker 1: Senator Cruz, what did we just see? Well, Michael, good morning.
Speaker 1: It is twelve twenty seven in the morning, and once again,
Speaker 1: you know, it feels like deja vu all over again.
Speaker 1: It's you know, when we got got got started on
Speaker 1: the Verdict podcast, it was during impeachment, and it seemed
Speaker 1: every night we would be there till midnight one two
Speaker 1: in the morning and then head straight to the studio.
Speaker 1: So I just came from voting on the Senate floor.
Speaker 1: As you noted, the vote was unanimous. It was ninety
Speaker 1: six to nothing. Every single Republican voted yes, every single
Speaker 1: Democrat voted yes. And we just passed out a two
Speaker 1: trillion dollar emergency relief package, which which hopefully will have
Speaker 1: significant effects relieving the economic devastation being caused by this
Speaker 1: Corona crisis. Well, I want to get into exactly what
Speaker 1: is in this package, because obviously there's a lot and
Speaker 1: some of it is controversial. But before we get to
Speaker 1: what is in it, I want to get to why
Speaker 1: we were sitting here in the middle of the night.
Speaker 1: You know, this bill was supposed to be voted on,
Speaker 1: I think over the weekend. Then it was supposed to
Speaker 1: maybe be voted on yesterday, then earlier today, and here
Speaker 1: we are it's after midnight. So I want to know
Speaker 1: why this was so delayed, And I guess more specifically,
Speaker 1: I want to know who delayed the vote. Well, that's
Speaker 1: an easy answer. It's it's two people. It's Nancy Pelosi
Speaker 1: and it's Chuck Schumer. Everybody thought we were going to
Speaker 1: vote on this Sunday night. The bill had been negotiated
Speaker 1: with about a dozen Democrats were part of the negotiating teams.
Speaker 1: They had all been active and engaged, and we thought
Speaker 1: we were going to take it up Sunday night and
Speaker 1: get it past. Nancy Pelosi came in at the last minute,
Speaker 1: and she threw a hand grenade in. She began making
Speaker 1: all of these completely unrelated partisan demands, and we showed
Speaker 1: up Sunday night and every single Democrat voted to block,
Speaker 1: are getting on the bill, are even starting to consider it,
Speaker 1: And so they blocked it on Sunday night. They blocked
Speaker 1: it Monday, all day Tuesday, all day to day until
Speaker 1: just about eleven o'clock last night when we finally got
Speaker 1: it past. So, as you noted in that clip we
Speaker 1: played at the beginning, which by the way, I thought
Speaker 1: was terrific. I was a big fan of you really
Speaker 1: calling calling it like it is here and saying what
Speaker 1: do emission standards? What does the Green New Deal have
Speaker 1: to do with coronavirus? So it looks as though the
Speaker 1: Democrats totally back down. I mean, I don't know, though
Speaker 1: you were there all day. Did the Democrats achieve anything
Speaker 1: by stalling the vote. What's the good stuff in the bill?
Speaker 1: What's the bad stuff in the bill? Well, look, it's complicated.
Speaker 1: Most of the extraneous partisan issues that that that Pelosi
Speaker 1: was fighting for, almost all of them are dropped out
Speaker 1: of the bill. So that's good that what she held
Speaker 1: everything hostage for Sunday and Monday and Tuesday is mostly gone.
Speaker 1: So so so what's past looks two trillion dollars. It's
Speaker 1: a a lot of moneyn of money. I mean, I
Speaker 1: mean that's that's ten percent of our national debt, not
Speaker 1: our deficit, ten percent of our national debt in over
Speaker 1: two centuries. We just spent ten percent of it tonight.
Speaker 1: And it's worth pausing to think that was unanimous. That
Speaker 1: means Bernie Sanders voted for it. I voted for it,
Speaker 1: and everybody in between voted for it. And what I
Speaker 1: would say is the reason is these are not normal times.
Speaker 1: This crisis is extraordinary. The health crisis is extraordinary. People
Speaker 1: are scared. We've got a global pandemic. But not only
Speaker 1: the health crisis, but the response to the health crisis
Speaker 1: has created an economic disaster that is unfolding. There are
Speaker 1: millions of people losing their jobs, and in response to
Speaker 1: that devastation, everyone feels an urgency to provide relief. Now,
Speaker 1: you mentioned at the outset, and this is something a
Speaker 1: lot of people are saying. They're referring it to it
Speaker 1: as stimulus. I don't call this a stimulus bill. This
Speaker 1: is a relief bill. It's quite different. It is designed
Speaker 1: to provide relief to people who are hurting badly and
Speaker 1: are hurting through no fault to their own. They didn't
Speaker 1: do anything to cause this. So what are the different
Speaker 1: pieces what's in this monstrous bill? Yeah, so one big
Speaker 1: piece of it is individual relief. And for every American
Speaker 1: in the country who makes under one hundred thousand dollars
Speaker 1: a year, you're getting a check. You're getting a check
Speaker 1: in the next couple of weeks. Individual adults are getting
Speaker 1: twelve hundred each, a couple's getting twenty four hundred each,
Speaker 1: and if you have kids, you get five hundred each
Speaker 1: for those kids. And those checks are expected to go
Speaker 1: out according to the Treasury Department. They're they're going to
Speaker 1: get them out in two to three weeks, So sometime
Speaker 1: probably early to mid April is when those checks are
Speaker 1: going to arrive. And allot of me if I'm wrong,
Speaker 1: this is unprecedented, right, I mean, we've never seen the
Speaker 1: federal government mailing checks to this large number of Americans
Speaker 1: for direct relief. The only thing comparable to that to
Speaker 1: this was during the two eight crisis. There was a
Speaker 1: smaller set of rebate checks that were sent out under
Speaker 1: the Bush administration, but it wasn't nearly a sign if
Speaker 1: again is this This is much more broad based and
Speaker 1: these are bigger checks. Look, if you're you look at
Speaker 1: restaurants that have been shut down all across the country.
Speaker 1: You look at bars, you look at at at hardware
Speaker 1: stores or nail salons. There are a lot of people
Speaker 1: who are hourly workers who suddenly finding themselves at home
Speaker 1: and are scared. How am I going to make the
Speaker 1: rent check next month? You know? How am I going
Speaker 1: to pay the basic expenses? How we're going to pay
Speaker 1: for food? And so these checks are providing relief on
Speaker 1: a broad based manner. It's not picking winners and losers,
Speaker 1: it's providing it across the board. Most economists degree that's
Speaker 1: not going to be a major stimulus effect, but it
Speaker 1: is going to help people who are worried and being
Speaker 1: hurt by this right now, right, I mean people you know,
Speaker 1: they can't afford to not work for a month or
Speaker 1: however long this is going to go on. So the
Speaker 1: idea is that's going to fill the gap and hopefully
Speaker 1: you can take twelve hundred bucks and put it toward
Speaker 1: your rent or whatever bill is do. What else is
Speaker 1: in the bill? You know, especially in terms of I
Speaker 1: know it was controversial that there's a loan program for
Speaker 1: businesses to stay afloat. The Democrats were vary against that.
Speaker 1: What does that program look like? Well, let me get
Speaker 1: to the Another major part of the bill that I
Speaker 1: think is really important is there's three hundred and seventy
Speaker 1: seven billion dollars for small businesses. And this is an
Speaker 1: emergency loan program that is going to go to small businesses,
Speaker 1: essentially businesses with five hundred employees or less. So the
Speaker 1: hardware stores and barber shops and restaurants that we talked about,
Speaker 1: all these folks that are are shuttered right now and
Speaker 1: are on the verge of bankruptcy, they can now you
Speaker 1: can now go if you're a small business owner, you
Speaker 1: can go and apply for a loan and you can
Speaker 1: get it. It's a small business Administration loan, but you
Speaker 1: can get it from your local bank. It's from all
Speaker 1: of the local banks in the community that you can
Speaker 1: go and apply for it, and it's up to ten
Speaker 1: million dollars. So it's small loans relatively speaking. But they're
Speaker 1: designed in particular to meet costs like payroll, to meet
Speaker 1: costs like rent, the basic costs that you have that
Speaker 1: you don't want to lose your business. And the way
Speaker 1: it's designed, if you spend the money on payroll, if
Speaker 1: you if you say to your employees, we're gonna keep
Speaker 1: paying you, we'na keep your paycheck coming, then those loans
Speaker 1: are forgivable. So for the small business owner, you can
Speaker 1: take the loan and if you actually pay it out
Speaker 1: to your employees, the loan obligation goes away. And so
Speaker 1: that's a direct lifeline not to these small businesses that
Speaker 1: are profoundly hurting, and a lot of them are making
Speaker 1: the decision right now do I stay open or do
Speaker 1: I shutter the door? Well, I'm sorry to interrupted. I
Speaker 1: mean this is a very important point here because you know,
Speaker 1: as we see the unemployment rate ticking up, you had
Speaker 1: claims last week for unemployment that we're comparable if not
Speaker 1: higher than you saw at the peak of the two
Speaker 1: thousand and nine crisis. I mean, you could have massive unemployment,
Speaker 1: you could have businesses falling apart. So this would allow
Speaker 1: the businesses to continue to employ their workers, right, and
Speaker 1: that means people keep a connection into their job. It
Speaker 1: needs they keep their health insurance, which is a big
Speaker 1: challenge for everyone. If you lose your job, you may
Speaker 1: be losing your health insurance. So we'd rather as many
Speaker 1: people as possible to stay employed, to stay in a
Speaker 1: position that when we get past this crisis, hope hopefully
Speaker 1: sooner rather than later, did everyone come back to work.
Speaker 1: That we want to get the economy moving again. And
Speaker 1: so these small business loans again are unprecedented. I mean
Speaker 1: to give you a sense. The Small Business Administration's budget,
Speaker 1: I think last year was twenty three billion dollars. This
Speaker 1: is three hundred and seventy seven billion dollars. So this
Speaker 1: is more than ten times the size of the Small
Speaker 1: Business Administration's entire budget. But all of that money is
Speaker 1: designed to flow out through the community banks to small
Speaker 1: businesses and to be used for payroll predominantly and other
Speaker 1: essential costs like rent and utilities, just to keep the
Speaker 1: businesses open. So I know that this brings up another
Speaker 1: question on employment that was really central to the debate today,
Speaker 1: and you played a central role in this, which is
Speaker 1: some Republican senators, I think Lindsay Graham mentioned it, and
Speaker 1: you spoke out very forcefully against it. Identified in the
Speaker 1: bill a provision that would actually incentivize people not to
Speaker 1: go back to work. What was that provision and where
Speaker 1: does that stand right now? So part of this bill,
Speaker 1: and one of the things in particular the Democrats demanded
Speaker 1: as a price of supporting this bill, was increasing unemployment
Speaker 1: insurance compensation. So when you're when you file for unemployment
Speaker 1: in your states, the federal government is plussing up those
Speaker 1: weekly compensation and plussing it up dramatically. Is basically adding
Speaker 1: six hundred dollars a week to what you can earn
Speaker 1: from unemployment. So so what does that mean? And listen,
Speaker 1: most Republicans, I think that is a good thing. We
Speaker 1: are going to see this week when the job numbers
Speaker 1: comes out. We're going to see millions of Americans who
Speaker 1: have lost their jobs in the last two weeks. I mean,
Speaker 1: it has been I've spoken to at least a dozen
Speaker 1: CEOs in the last week, who've laid off thousands or
Speaker 1: tens of thousands of employees. I mean, it's just one
Speaker 1: after the other after the other. And and and if
Speaker 1: you're suddenly laid off, having unemployment and enough to support
Speaker 1: your family is important. So I think plussing it up
Speaker 1: made sense. Here's the problem. The way it is designed,
Speaker 1: the six hundred dollars is irrespective of what you were
Speaker 1: making before, which means, like I'll give you an example
Speaker 1: in Texas. So right now, in Texas, the maximum someone
Speaker 1: can make on unemployment is five hundred and twenty one
Speaker 1: dollars a week. That's that, that's what the state unemployment
Speaker 1: will and and that's that's based on your income. We're
Speaker 1: now adding six hundred bucks a week to that. So
Speaker 1: instead of five hundred and twenty one dollars a week
Speaker 1: in Texas, it's now eleven hundred and twenty one dollars
Speaker 1: a week. It's a nice raise, that is a very
Speaker 1: nice race. But here's the problem. There's no constraint on
Speaker 1: whether it is more than you were making in your job,
Speaker 1: and and and so I and a number of other
Speaker 1: senators we introduced an amendment today, just a common sense
Speaker 1: amendment that said, look, you should not make more on
Speaker 1: unemployment than you were making working. It's common sense, right,
Speaker 1: and we had so we debated it on the Senate floor.
Speaker 1: It was interesting, actually, an astonishing thing broke out on
Speaker 1: the Senate floor, real debate. Dick Durbin, Democrat from Illinois,
Speaker 1: was arguing back and forth, and our amendment just was
Speaker 1: a simple proposition that you shouldn't be paid more in
Speaker 1: unemployment than you were making in your job. And the
Speaker 1: reason is you don't want to disincentivize work. I'll use
Speaker 1: the Texas example. Eleven hundred and twenty one dollars a week.
Speaker 1: That's a little bit over fifty eight thousand dollars a year. Now,
Speaker 1: that's four months worth, but annualize that's fifty eight grand
Speaker 1: a year. That works out to over twenty eight dollars
Speaker 1: an hour. The problem is, if we're paying people that
Speaker 1: much not to work, it incentivizes people not to work.
Speaker 1: And it was very much ever, go back to your job, well,
Speaker 1: and the back and forth. So Durban did what a
Speaker 1: lot of Democrats did, which is he demagogued. He said, oh,
Speaker 1: these Republicans are saying anyone unemployed is lazy and rotten.
Speaker 1: And I said, Hold on a second. We're saying exactly
Speaker 1: the opposite, which is this policy will hurt workers and
Speaker 1: it'll hurt small businesses. Why let's say you're a waitress
Speaker 1: and you've been been laid off from your job. You're
Speaker 1: getting unemployment, but suddenly you're making twenty five, twenty six,
Speaker 1: twenty eight dollars an hour at home not working, and
Speaker 1: you face the decision do I go back to work
Speaker 1: for ten, twelve, fifteen dollars an hour. We're creating incentives
Speaker 1: where it would be perfectly rational to say I'm not
Speaker 1: going to go back to work because I make a
Speaker 1: lot more money on unemployments. That hurts the workers. It
Speaker 1: also hurts small businesses. Let's say you're trying to reopen
Speaker 1: your restaurant. The shutdown has stopped in your city. You
Speaker 1: want people to come back. You call up your old
Speaker 1: employees and they say, look, I'd love to come back
Speaker 1: to work, but I can't afford the pay cut. Yeah,
Speaker 1: you know, you gotta match my unemployment salary. So that
Speaker 1: I think was an unfortunate mistake, and we ended up
Speaker 1: the amendment loss. It was basically a party line vote.
Speaker 1: I think every Democrat voted against accept Joe Manchin. He
Speaker 1: was the one yes. But I think that was unfortunate.
Speaker 1: But it nonetheless, there will be significant benefits from the
Speaker 1: additional unemployment insurance in this time of crisis. Right, Okay,
Speaker 1: that makes sense. It's too bad unfortunately that that seems
Speaker 1: to have been left in the bill. But I guess
Speaker 1: obviously there's a lot of debate here, and you did
Speaker 1: come to a unanimous vote. However, I have to pick
Speaker 1: up on what you said. You said the vote was
Speaker 1: ninety six to zero. There's more than ninety six senators.
Speaker 1: Some people were missing. Yeah, Now we've got got several
Speaker 1: senators who are out on quarantine. And where that started
Speaker 1: from was a few days ago Rand Paul tested positive
Speaker 1: for the coronavirus and and he had been in in
Speaker 1: DC the whole week. And actually the way we found
Speaker 1: out about it, so we were meeting every day for lunch,
Speaker 1: the Republican senators, and it was interesting. We shifted. We
Speaker 1: normally meet in a room in the capital called the
Speaker 1: Mansfield Room, and and it's um and actually, by the way,
Speaker 1: the Minority meets in the LBJ Room, which is a
Speaker 1: smaller room, but the Mansfield Room is bigger. So it's
Speaker 1: one of the things. It was nice. In twenty fourteen,
Speaker 1: we became the majority, we switched our lunch rooms and
Speaker 1: got to a bigger room. That's a nice perk. But
Speaker 1: when coronavirus hit um, we all wanted a social distance,
Speaker 1: and so the Mansfield room we decided was too small,
Speaker 1: so we were meeting instead in a conference room, and
Speaker 1: we moved actually to a couple of different conference rooms
Speaker 1: that were sort of almost like big auditoriums in one
Speaker 1: of the Senate office buildings, And so we were in
Speaker 1: one of those big, big auditoriums where the acoustics were terrible.
Speaker 1: It's hard for everyone to hear because they're not they're
Speaker 1: just it's not good acoustics. But but Mitch, every every
Speaker 1: day we were meeting for lunch, and we'd have often
Speaker 1: a two to three hour lunch because it would be
Speaker 1: a progress report on the negotiations of the bill. And
Speaker 1: there were different committees that we're working on different portions
Speaker 1: of the bill. So the people would stand up and say,
Speaker 1: all right, here's what's going on with this, and we'd
Speaker 1: ask questions. We debate back and forth, and so a
Speaker 1: few days ago, we're there and Mitch's talking and he
Speaker 1: just kind of matter of facts says, and so Rand,
Speaker 1: Paul just tested positive for coronavirus, and we're all sitting
Speaker 1: there going, what the what like like like, I mean,
Speaker 1: it's and Mitch just very matter of fact mentions it
Speaker 1: and keeps going on and a whole bunch of a second,
Speaker 1: Hold on a second, can can you rewind that tape
Speaker 1: and play it again? And so it was well, and
Speaker 1: Rand had been at the Senate. He had been that
Speaker 1: morning at the Senate. Jim, he'd been swimming in the pool. Wow,
Speaker 1: I gotta say, I don't think I've ever seen my
Speaker 1: colleagues as pissed off as they were, like he had
Speaker 1: just gotten the positive test results, and then they were
Speaker 1: pretty angry that he hadn't self quarantine. Now, Rand said
Speaker 1: he wasn't sick, he had no symptoms, he hadn't come
Speaker 1: in direct contact with the He was at a gathering
Speaker 1: with people who were sick, but he didn't come in
Speaker 1: direct contact with them. I understand his reason. I can
Speaker 1: tell you people were freaked out. And so I remember
Speaker 1: we're sitting there going, Okay, well, what do we do?
Speaker 1: I mean, they're fifty three Republicans. The immediate question all right,
Speaker 1: are we all quarantine? Like, as you know, I spent
Speaker 1: eleven days in self quarantine in Houston, and I'm like, well,
Speaker 1: all of us have been here with Rand. What does
Speaker 1: this mean now? And what ended up happening is within
Speaker 1: an hour or two, two people self quarantined as a result,
Speaker 1: Mike Lee and Met Romney. Yeah. And the reason is
Speaker 1: at lunch they had sat on either side of Rand.
Speaker 1: They had been at lunch with him, they sat next
Speaker 1: to him, They'd been there for a couple hours, and
Speaker 1: so they decided neither of them are feeling sick. Talk
Speaker 1: to both both Mike and Mit this week after they quarantine.
Speaker 1: They both said they were feeling great, but they self
Speaker 1: quarantine because they sat next to Rand and spent a
Speaker 1: couple of hours. You know, I thought about it, but
Speaker 1: as it so happened this past week, I just didn't
Speaker 1: run into Rand. In fact, I didn't even I didn't
Speaker 1: know he's around. I'll often sit next to him at lunch.
Speaker 1: I just didn't happen to this week. So it was
Speaker 1: a good, good week not to sit next to Rand, Paul.
Speaker 1: But it puts you in a tough position because as
Speaker 1: you're all sitting there and leader McConnell tells you all,
Speaker 1: by the way, one of your colleagues has coronavirus. You know,
Speaker 1: it's a pretty small club there in the US Senate.
Speaker 1: You're all voting on this very important legislation. If all
Speaker 1: of the Republicans self quarantined, what happens to the bill?
Speaker 1: That is was a real issue, And I think that's
Speaker 1: one of the reasons why all of us said, let's
Speaker 1: move forward and get this done quickly and get the
Speaker 1: hell out of here. Everyone's flying home tomorrow morning, and
Speaker 1: the Senate is not expected to be in session for
Speaker 1: several weeks. But you know, look, if you look at
Speaker 1: the Senate, there are a lot of people in their
Speaker 1: seventies and eighties. I mean, you want to talk about
Speaker 1: a potentially vulnerable population. We're trying to stay away from
Speaker 1: each other. We're trying to like social distance. People are
Speaker 1: pouring hand sanitizers like crazy. But you know, Rand and
Speaker 1: and and Rand and I traded text. He said he's
Speaker 1: feeling good and feeling healthy. But you remember Rand, what
Speaker 1: was it a year or two? Right? His neighbor tackled him,
Speaker 1: broke six ribs. The ribs punctured his lungs. He got pneumonia,
Speaker 1: and they did surgery and remove part of his lung.
Speaker 1: And and so what's scary about this is Rand, with
Speaker 1: with part of his lung removed, is in a vulnerable
Speaker 1: position where he's more vulnerable if he gets COVID nineteen,
Speaker 1: if he gets sick, he's potentially more vulnerable. And so
Speaker 1: that's he's obviously taking it seriously. But all of us
Speaker 1: are are are worried and praying for Rand. Of course, Yeah,
Speaker 1: that that really does bring it home because some people
Speaker 1: have even kind of and joking about how the median
Speaker 1: age of the US Senate is about one hundred and fifty,
Speaker 1: and so you know that's an at risk population. But
Speaker 1: of course Senator Paul in particular is especially at risk here.
Speaker 1: So I suppose everybody should pray for his speedy recovery.
Speaker 1: And it's one other actual coincidence I suppose with Rand
Speaker 1: Paul being out for this vote, is he's been so
Speaker 1: outspokenly say libertarian, you know, during his political career, and
Speaker 1: conservatives now are struggling with what to think about this
Speaker 1: bill because it's so much money. You know, it's the
Speaker 1: biggest package like this ever in American history. But this
Speaker 1: is a totally novel circumstance. How should conservatives be looking
Speaker 1: at this? Look, I've struggled with it. Every conservative is
Speaker 1: struggled with it. Two trillion dollars is a ton of money.
Speaker 1: I think the magnitude of the challenge we're facing justifies it.
Speaker 1: And I also think it's very different. I mean, some
Speaker 1: people are trying to draw the analogy to tarp to
Speaker 1: to what happened with the two thousand and eight financial crisis.
Speaker 1: I think they're dramatically different. And the biggest reason their
Speaker 1: difference is the financial meltdown was caused in very significant
Speaker 1: part by misconduct by the financial services firms who were
Speaker 1: taking undue risks, who got all the upside if they
Speaker 1: made money, they got rich and and got to enjoy
Speaker 1: the blessings. But then when it all cratered, the government
Speaker 1: had to step in and help them, and so it
Speaker 1: it felt very much like a rigged gain. This is
Speaker 1: a very different circumstance because the people that are getting
Speaker 1: relief here, they didn't do anything to cause the coronavirus.
Speaker 1: It wasn't their conduct. You know, the individual waiter who's
Speaker 1: been laid off, it's not his fault that this started
Speaker 1: in Wuhan and spread across the world. It's it's not
Speaker 1: the fault of the guy who owns the local movie theater,
Speaker 1: and and so I think that's different. I think it's
Speaker 1: also important that if you look at how this is structured,
Speaker 1: You've got the individual grants, which which are very important relief.
Speaker 1: You've got the small business piece, which is very important
Speaker 1: if you look at other elements of it. So there
Speaker 1: is one hundred billion dollars in this directed to hospitals
Speaker 1: and healthcare providers. Now look in the coronavirus circumstance. Hospitals
Speaker 1: are panicking. They need to spend their capacity. One hundred
Speaker 1: billion dollars for hospitals. You know, God forbid, you have
Speaker 1: circumstances where we need to ramp up quickly. That is
Speaker 1: almost the very definition of emergency relief for this crisis.
Speaker 1: You've got sixteen billion dollars for protective gear, for ventilators
Speaker 1: and medical supplies. That again is crisis appropriation. You've got
Speaker 1: one hundred and fifty billion dollars for state and local
Speaker 1: governments to meet the coronavirus and it's limited so that
Speaker 1: it goes to coronavirus spending on the state and local level.
Speaker 1: So you're saying that the states and the cities they
Speaker 1: can't just spend it on whatever pet project they want.
Speaker 1: There actually will be some checks on how they can
Speaker 1: use the federal money. I hope, so maybe not. But look,
Speaker 1: let me throw in the caveat this bill is massive.
Speaker 1: It was drafted really quickly. We're going to find all
Speaker 1: sorts of ugly things there as it rolls forward. So
Speaker 1: when it comes to the constraints on the states, at
Speaker 1: least as it was relayed to us, as we understood
Speaker 1: it, it it was intended to be just coronavirus spending. Can
Speaker 1: I promise that there won't be states frittering the money away? No,
Speaker 1: but they are facing a massive and unprecedented health crisis.
Speaker 1: So the intention was give them the funds. And that
Speaker 1: was one of the big Democratic holdouts and demands also
Speaker 1: as they wanted money for the state and local governments.
Speaker 1: And that's one of the big things that was added
Speaker 1: that was expanded in the last couple of weeks. The
Speaker 1: part that is deemed the most controversial is there's five
Speaker 1: hundred billion dollars for what's called the Stabilization Fund. Now
Speaker 1: that's what the Democrats have been characterizing as the big
Speaker 1: corporation bailout. Right, listen of all the parts of the bill,
Speaker 1: that's the part I have the most concerns about. But
Speaker 1: I do think they're differences even in that part from
Speaker 1: from a bailout. Almost all of that is structured as loans.
Speaker 1: So what are the components of it? The components of it?
Speaker 1: You've got four hundred and fifty billion dollars that basically
Speaker 1: goes to the FED to make loans across the economy,
Speaker 1: and it's designed for the FED to leverage it up
Speaker 1: so that four hundred and fifty billion is expected to
Speaker 1: result in about four trillion dollars in additional capital. So
Speaker 1: I'm sorry, pardon my economic ignorance. How does that work?
Speaker 1: So the FED will make loans, will make loans that
Speaker 1: will go out to businesses, to companies all through the country,
Speaker 1: and you know, look in thinking about how to respond
Speaker 1: to this crisis, I try to talk to a lot
Speaker 1: of experts, to conservatives who I know in respect and trust.
Speaker 1: So one person I called his Art Laugher. Art Laugher
Speaker 1: is a good friend, was Reagan's chief economist, helped design
Speaker 1: the Reagan tax cut, the Laugher curve. You you may
Speaker 1: recall he drew on a napkin that laid out the
Speaker 1: principle that if you raise taxes too high, tax revenue
Speaker 1: will go down. And in that circumstance, if you lower
Speaker 1: the tax rate, you can actually the federal grammer collects
Speaker 1: more taxes because of incentives. Art is a strong conservative,
Speaker 1: A great friend. I called Art said, all right, what
Speaker 1: should we be doing this? This is an economic catastrophe.
Speaker 1: What what should a conservative be doing it? Art focused
Speaker 1: on two things. He said, Number one, we should do
Speaker 1: a payroll tax holiday from now to the end of
Speaker 1: the year. Payroll tax is about seven and a half
Speaker 1: percent paid by the employee, about seven and a half
Speaker 1: percent paid by the employer. We should just say nobody
Speaker 1: has to pay it from now to the end of
Speaker 1: the year. That would create enormous incentives for work. Look
Speaker 1: at Harkins, back to the fight we had over the
Speaker 1: unemployment compensation, the disincentive for work. I'm very focused on
Speaker 1: incentives for work. Right. That makes sense. By the way,
Speaker 1: half of that proposal is in this bill. One of
Speaker 1: the things that is included in this bill is from
Speaker 1: now to the end of the year, employers don't have
Speaker 1: to pay their half of the payroll taxes. They have
Speaker 1: to repay it in twenty twenty one and twenty twenty two.
Speaker 1: But it defers those tax payments, which means for an
Speaker 1: employer lowers the cost of employment. It makes jobs less expensive.
Speaker 1: That is a good supply side step in terms of
Speaker 1: tax really. But the other thing Art said, and this
Speaker 1: was important, He said, Listen, the most dangerous thing in
Speaker 1: an liquidity crisis is you don't want it to become
Speaker 1: a solvency crisis. Now what does that mean. That means
Speaker 1: your customers have dried up because the government is making
Speaker 1: people stay home, and suddenly your revenue is plummeting and
Speaker 1: you can't meet your basic bills. You can't meet your payroll,
Speaker 1: you can't meet your mortgage, you can't meet your rent.
Speaker 1: And so when you face a solvency crisis, you've got
Speaker 1: a suddenly sell stuff on the cheap. We don't want
Speaker 1: to see the airlines suddenly have to auction off all
Speaker 1: their planes for ten cents on the dollar. That would
Speaker 1: take a temporary crisis and turn it into catastrophe and
Speaker 1: the and so what Art said is you want to
Speaker 1: have liquidity in the system. You want to have people
Speaker 1: being able to get a line of credit. Companies able
Speaker 1: to get a line of credit, so they survived the catastrophe.
Speaker 1: And so that was his principal recommendation, which has been
Speaker 1: echoed by a lot of conservative economists I've talked to
Speaker 1: that four hundred and fifty billion is designed to do
Speaker 1: exactly that, to make want to take this acute problem
Speaker 1: and have it lead to very long term economic catastrophe
Speaker 1: because we were too cheap to do what we had
Speaker 1: to do in the moment. That's exactly right. Now. All
Speaker 1: of that is our loans. Those are not grants. So
Speaker 1: nobody's getting a special payment that they get to keep.
Speaker 1: No one's getting bailed out in that sense. All it
Speaker 1: means is they're able to go and get a loan
Speaker 1: and they're able to get alan. Think about it, if you,
Speaker 1: let's say you run a hotel. Yeah, I talked to
Speaker 1: several hotel owners who described, like one said their occupancy
Speaker 1: rate was now six percent. Look six percent, you couldn't
Speaker 1: go get a loan. I mean, a hotel is not
Speaker 1: a going concern it with six percent occupancy rate. Now
Speaker 1: it won't always be. It didn't used to be. And
Speaker 1: when the crisis is over, presumably it won't. But who
Speaker 1: would want to see every hotel auctioned off at a
Speaker 1: foreclosure sale? And all that would mean is whoever happened
Speaker 1: to have capital would suddenly have a windfall be able
Speaker 1: to acquire you know, let's go buy the Waldorf Astoria
Speaker 1: for ten cents on the dollar. That actually doesn't help
Speaker 1: the economy or anything to force every business owner to
Speaker 1: sell their assets. And so the liquidity is basically giving
Speaker 1: someone the capacity to get out of it. Now, look,
Speaker 1: there may be some failures, there's some taxpayer exposures. Quidity
Speaker 1: is not cost free, yeah, but but it is not.
Speaker 1: It's designed to be broad based enough that hopefully it
Speaker 1: won't be the government picking winners and losers. Now, well,
Speaker 1: it does sound very different in that way from the
Speaker 1: two thousand and nine federal spending that we saw. Yes,
Speaker 1: now there are two exceptions to that, one of which
Speaker 1: is more problematic than the others. So there's seventeen billion
Speaker 1: that is carved out they say for nationally security important
Speaker 1: companies that basically everyone knows means Boeing and maybe ge
Speaker 1: and and they were pretty candid about we're just writing
Speaker 1: it to help and listen, Boeing has all sorts of
Speaker 1: problems that had nothing to do with the coronavirus, and
Speaker 1: and and and I fought hard against that, the Boeing
Speaker 1: and G money. I argued against it. I stood up
Speaker 1: in conference and I mean blasted my colleagues, and you
Speaker 1: know what, we couldn't get get it out of the bill.
Speaker 1: And the sad thing is the Republicans wanted it in,
Speaker 1: and so did the Democrats. The second industry specific component
Speaker 1: is airlines and airlines. It's interesting, you know, the Democrats
Speaker 1: talking point, which all of them are saying, is this
Speaker 1: is all corporate welfare for Republicans. They want the big corporations.
Speaker 1: Here's the irony, Mike. The corporate welfare increased because of
Speaker 1: the Democrats demands. So the Democrats are entirely posturing. So
Speaker 1: let's take, for example, the airline portion of it. So
Speaker 1: there was fifty eight billion, and the Republican bill that
Speaker 1: we had, actually the bipartisan bill that we had that
Speaker 1: we're going to vote on on Sunday, there was fifty
Speaker 1: eight billion for airlines, but it was all in loans.
Speaker 1: It was one hundred percent loans that they would have
Speaker 1: to pay back. The Democrats in the last three days
Speaker 1: of their negotiations, they insisted that fifty percent of it
Speaker 1: be grants, that it be direct grants rather than loans.
Speaker 1: So the next time you see if you listen to
Speaker 1: any of the Democrats rattling on about they're the ones
Speaker 1: that fought for the grants instead of the loans. You know,
Speaker 1: you don't see that reported and much of the mainstream press,
Speaker 1: actually you don't see much of any of this that
Speaker 1: we're talking about right now reported in the mainstream press. Senator,
Speaker 1: we're already over time, but just before we go, do
Speaker 1: you have a sort of thirty second takeaway beyond everything
Speaker 1: we've talked about for the American people while they're looking
Speaker 1: at this crisis and while they're looking at this relief package. Listen,
Speaker 1: this crisis is extraordinary. But we're going to make it
Speaker 1: through this. We're gonna make it through the public health side.
Speaker 1: And people are scared. I get it. People are frustrated
Speaker 1: about being at home. We will make it through this,
Speaker 1: but we'll also make it through the economic challenges. I mean,
Speaker 1: people are worried. Now. You and I have never lived
Speaker 1: through a great depression. We've never seen twenty percent, thirty
Speaker 1: percent unemployment. I don't know if we will see that
Speaker 1: or not. I certainly don't want to. I hope that
Speaker 1: this emergency relief package helps. But the way we stop
Speaker 1: the economic devastation as we solve the pandemic is that
Speaker 1: we contain it. Is that we develop effective vaccines and treatments.
Speaker 1: We need to do that, and my focus and priority
Speaker 1: is stopping this pandemic but also ensuring that we have
Speaker 1: an economy that can keep going going forward. We don't
Speaker 1: want to see every small business in America destroyed in
Speaker 1: the process of keeping us safe. So we got to
Speaker 1: do both and that they're going to be challenging days ahead.
Speaker 1: But but it's worth remembering. Listen, America is a great country,
Speaker 1: and we're great because of the character the people. We
Speaker 1: have overcome challenges before. We've overcome world wars, We've overcome
Speaker 1: nine to eleven, and we will overcome this and that
Speaker 1: I'm inspired every day by the heroism of the American people,
Speaker 1: and that's what's going to take us beyond this challenge
Speaker 1: as well. I agree, And part of the way that
Speaker 1: we will recover is by staying healthy. And Senator, part
Speaker 1: of the way you stay healthy is by getting enough sleep.
Speaker 1: So we've got to let you get out of here
Speaker 1: and go back home and get at least a few
Speaker 1: hours of sleep. There's so much more cover. I guess
Speaker 1: we'll just have to get to it next time. I'm
Speaker 1: Michael Knowles. This is verdict with Ted Cruz.