Ron Johnson参议员谈参议院围绕特朗普“大而美法案”的摊牌｜All-In访谈

Power corrupts. Government is power, and it’s been corrupted. Nobody knew in total how much we spend because we never even talk about it. The first goal of this Republican budget reconciliation should be: don’t add to the deficit.

I voted for President Trump because I wanted him to defeat the deep state. You don’t defeat the deep state by continuing to fund it at Biden’s levels. Our base is going to go, “What? Why did we elect you guys? You’re really no better than Democrats?” I don’t think President Trump is focused on reducing spending. This is our one opportunity, and right now we’re blowing it. I’m going to do everything I can to make sure we don’t blow it. I can’t be pressured by President Trump. He’s willing to sit down with me, look at the numbers, acknowledge them, and work forward in a reasonable plan. That’s the only way he’s going to get my support.

So, everyone has assumed that the House passage of the reconciliation bill is going to go to the Senate with some minor changes and then make its way to President Trump’s desk for signing. But that may not be the case. There are several hardliners in the U.S. Senate who have made it very clear that the budget and fiscal deficit problems arising from this bill are insurmountable, and they’re going to take a very hard stance on voting no on this bill.

Taking the lead on that point of view is Senator Johnson from Wisconsin, who’s going to join us today for an emergency pod to talk about what’s next with the Senate review of the reconciliation bill, his thoughts on it, the future of the republic, and what’s ahead. We’re really excited for this emergency pod. Thank you for joining us.

All right, besties. I think that was another epic discussion. People love the interviews. I could hear him talk for hours. Absolutely. We crush your questions in a minute. We are giving people ground truth data to underwrite your own opinion. What do you guys think? That was fun. That was great.

Senator, thanks for joining Chamath for this conversation this morning.

Good morning, guys, and thanks for having me on.

And just by way of background, Senator, you were elected to the U.S. Senate in 2010. You’ve had 2 reelections since then. More recently, we’ve taken notice, and I gave a shout-out to you for your comments on the scaling of the deficit and U.S. federal debt.

As a Republican, you’ve come out against the stated intention of getting this bill passed through the Senate as is, and we’d love to hear from you today about your points of view on the bill that was passed in the House this week—the reconciliation bill—and then take a step back and talk a little bit about the fiscal picture for the United States and where things are headed. So, thanks for that, and thanks for joining us.

Maybe we could just start with a very basic primer for our audience, something that we don’t talk about very much on the show. Can you tell us what a reconciliation bill is and how it’s used, so folks can understand a little bit about the process that the House just undertook and what’s ahead?

Sure. Let me start. You talked about when I first ran for election in 2010. I sprang out of the Tea Party. I’d never been involved in politics whatsoever and didn’t even decide to run until the end of April. I announced in May, started a campaign during the summer, and did all those parades. What I would shout during the parades was, “This is a fight for freedom. We’re mortgaging our children’s future. It’s wrong. It’s immoral. It has to stop.” That was my campaign theme.

In 2010, I still view myself as more Tea Party than Republican Party. We have a lot of big spenders in the Republican Party as well. I ran again because of Obamacare, which I knew would not work. It’s not working. By the way, that’s the problem with Medicaid right now: Obamacare is now called Medicaid expansion.

Budget reconciliation was set up in the Budget Act—I think it was 1974. It doesn’t work in terms of controlling spending. By the way, nothing ever has. We’ll get into that, because we’ve never had a process for actually controlling spending. But it allows us to pass a budget and then reconcile the budget. You’re able to pass a budget that’s not a law, but you pass this budget with just 50 votes—51 votes, a majority—and then you can reconcile to that budget, also avoiding the Senate filibuster. So, that’s the main component.

What’s weird about it is that you pass this budget, but you can only, through budget reconciliation, address mandatory spending. You can’t touch the discretionary spending accounts, which are about 25% of our budget. That’s one of the ways the budget has gotten completely out of control: we put so many things into the mandatory category. Initially, that was entitlements—Social Security, Medicare, and Medicaid—but we have, I would say, deviously slid all kinds of discretionary spending into “other mandatory.”

That really exploded during COVID, where I think “other mandatory” hit well over $2 trillion. Last fiscal year, it was about $1.3 trillion. This year, it will be over $1 trillion. So, it went from about $642 billion in 2019. “Other mandatory”—again, not Social Security, Medicare, or even Medicaid—went from $642 billion to $1.3 trillion last year. This year, it’s going to be over $1 trillion, and it’s going to keep pretty much at that level as far as the eye can see.

So again, that’s $1 trillion of other non-entitlement spending that we never look at. That’s the whole point about mandatory spending: it’s never looked at. Anyway, we can address mandatory spending, not Social Security, through this reconciliation process. We can change programs, do whatever we want to do, as long as it has a primarily budgetary impact, not changing policy. So you can change policy as long as it has a budgetary impact. I know that’s reasonably complex, but it’s an insane system, and it doesn’t work.

What’s the alternative?

Well, right now, we don’t really have one. Again, let’s just go through why we’ve never had a process to control spending. We don’t have a balanced-budget requirement like states do, and we have the capability of printing money, which we’re doing, incurring this enormous debt. So, we don’t have a balanced-budget requirement.

I didn’t realize this until just recently. The appropriation committees were literally set up because the authorizing committees were big spenders. So they set up appropriation committees to control spending. That didn’t work. The Budget Act didn’t work. Simpson-Bowles didn’t work. The Budget Control Act didn’t work. It did restrain discretionary spending for a couple of years until we weaseled our way around it. So again, we’ve never had a process to control spending.

One of the things I’ve been arguing in some Wall Street Journal columns is: let’s use the example of DOGE. I come from the private sector. We probably spent more time reviewing my line-by-line budget for my business, and I think other private-sector businesses spend more time analyzing what they’re going to spend than Congress spends over the entire federal budget.

So we’ve got to develop a process. DOGE has shown us how to do it: go contract by contract, expose the grotesque waste, fraud, and abuse. But we’ve got to do that through thousands of lines in the federal budget. Nobody’s willing to do it. Nobody’s willing to take the time to do the work.

They’re doing what they’ve always done. They exempt most spending, look at a couple of programs, try to tweak them, and try to get a big score out of the CBO so they can say, “Hey, look, we saved $1.5 trillion.” And yet that’s completely divorced from reality. $1.5 trillion sounds like a lot, but over 10 years, it’s $150 billion against a $7 trillion-a-year budget that only 6 years ago was $4.4 trillion.

And if I’ve got one complaint in terms of the process in the House, it’s basically devoid of reality. We’re not talking about the numbers we should be talking about, which is a 10-year deficit projected by the CBO of $22 trillion, averaging $2.2 trillion a year. We don’t talk about that. We focus all on $1.5 trillion, and then they’re patting themselves on the back that they didn’t even achieve $1.5 trillion.

I just want to make sure, Senator, that we’re on the same page with respect to the math. If this bill passes as is, can the general public take the $33 or $34 trillion that we have in debt, add $22 trillion, and say we’ll be at $58 trillion by 2035? Is that the right math or the wrong math?

That understates it. Now, they’ll talk about dynamic scoring, and I believe in dynamic scoring as well. But in this case, take a look at the tax cuts that President Trump is proposing. They’re not going to generate growth; they’re just going to reduce the deficit.

The CBO projection I’m looking at assumes we’re going to gain another $4 trillion from increasing taxes. So again, we may not get that $4 trillion, but no matter what, the CBO projection right now is adding another $22 trillion to our debt. It certainly would add at least that. I would argue you’d probably add another $3 or $4 trillion. So it’s not going to be $59 trillion; it’s going to be more like $62 or $63 trillion.

And the CBO scores assume the interest rate on the federal debt, I believe, is an average of 3.6%. Now we’re seeing the 30-year trading above 5%, meaning that if we trade up to 5% for the cost of debt for the federal government, we’re probably going to add another $5 trillion of incremental interest expense over the period—another half-trillion a year, on average, over the next 10 years.

Yeah, no, I would agree. The current CBO projection—that’s what I’m talking about here. Going from $37 to $59 trillion in debt is the rosy scenario; that’s as good as we’re going to do. So we’re simply—this does not meet the moment in terms of what we have to do.

Senator, let me just ask—I think there’s one point of clarification on your earlier comment that would be important for the audience.

What has been put under mandatory that should be discretionary?

It covers the entire gamut of federal spending: education, welfare, food stamps, veterans benefits. Again, they've just transferred that into mandatory spending, so it's completely out of sight, out of mind, and unaccountable.

When it sits in discretionary, does that mean the administration under the president has the authority to spend up to that amount to administer the law, to administer the statutes, but doesn't necessarily have to? And with mandatory spending, the cash has to go out. Just help us understand for the audience what the difference is.

Well, discretionary spending is actually supposed to be passed each year through an appropriation process, which is completely broken. We don't pass individual appropriation bills. We generally, at best, pass minibus or omnibus bills. These are multithousand-page bills that get dropped on our desks, and we have to vote on them literally within 24 to 48 hours. Nobody reads them. Nobody knows what's in them. That process is pretty broken down.

Right now, we are operating for this fiscal year under a continuing resolution, which tweaks a few things but is basically spending at last year's levels on all those appropriated accounts. Again, that's about 25% of our budget. Then 75% is in the mandatory accounts—the entitlements and just other mandatory spending.

So the arithmetic indicates we're entering into a debt death spiral in the United States. With interest rates climbing and the deficit climbing, we then need to spend more money to pay interest on the existing debt. That increases the deficit, so we need to borrow more. The debt spirals up, interest rates climb, and this becomes an insurmountable hill to climb.

As you have these conversations with members of the Republican Party, what's the point of view? What is the motivating factor for business as usual? Why is it so difficult to get folks to see the basic arithmetic in front of them?

Well, let me give you an example from about 3 years ago. This was after COVID, and on a bipartisan basis, we went on a massive spending spree in 2020, but then the Biden administration just continued that. We were in an omnibus spending debate, and for the first time—even though the Republican Senate Conference has a resolution against earmarks—McConnell was negotiating an omnibus spending bill, and all of a sudden members were sucking down earmarks.

So I asked my colleagues at that time, “Hey, does anybody know how much in total we spent last year in the federal government?” The room was dead silent. I went out to the Washington press corps and asked the same question: “Hey, does anybody know how much we spent last year?” One reporter said it was over $1 trillion. No, that's just discretionary spending. The answer was something like $6.3 trillion, because we had gone from $4.4 trillion in 2019 up to $6.5 trillion, and we've never looked back.

The analogy I used is that no family, if they had an illness and borrowed $50,000 to pay medical bills, would keep borrowing $50,000 to spend at that level if they got well the next year. But that's exactly what we've done.

The point of my story was that nobody knew in total how much we spend, because we never even talk about it. So that's out of sight, out of mind, and it's completely out of control. I'm the guy who, starting with my Wall Street Journal column of January 1 about a return to prepandemic spending levels, has been hammering the Senate Republican Conference on a weekly basis and, quite honestly, ad nauseam.

What's the pushback? What are they—have they just thrown in the towel? Do they say, “Well, it's too hard. I mean, that's unrealistic. You just can't do it”?

Even though I lay out the numbers, let me just tell you how I laid out my prepandemic levels of spending. This was between Christmas and New Year's. I was trying to figure out how I could communicate this, how I could justify it, and what kind of control we could put on things.

I literally went back in history. I went back to Clinton in 1998, Obama in 2014, and Trump in 2019. I exempted Social Security, Medicare, and interest. Spend what you needed to spend. But all other actual outlays in those 3 years, I increased by inflation and population. Reasonable control, right? It's what we should have. We don't have a balanced-budget amendment. At least we should have some reasonable control over outlays. Population growth and inflation would make sense.

Senator, if we take your math and say that we are headed to—let's take the midpoint—$65 trillion of debt by 2035, I think it's fair to say that the bond market will have a negative reaction to that. What Dave just talked about, which is a 5% borrowing rate for America, could be on the low side. That's the spiral that he's talking about.

On Friday, Secretary Bessent tried to get in front of this, and his commentary was, “We will grow our way out.” Can you talk to us about what he means by that and what the boundary conditions need to be to grow our way out?

First of all, by my calculation, our average interest rate over the last 50 years on government debt is about 5.8%. That's 50 years, and we're down here about 3%, somewhere around 3%. Those are not exact calculations.

Listen, that is the hope of all of us. I will absolutely agree that the number one component of a solution to our enormous debt and deficit problem is economic growth. We have to grow the economy. But here's the problem: When the government is sucking money out of the private sector—we're the ones borrowing the money—there's not a whole lot of money left for businesses in the private sector. There's not enough capital there.

Now, you can print more money, but then that sparks inflation, and that, of course, erodes everybody's balance sheet. It also makes our debt less expensive as well. But because we're so in debt, that drives up the interest rates, and again, it ends up being a debt death spiral.

Nobody can predict this. But that's just the wishful thinking of people putting forward a policy—a One Big Beautiful Bill—that doesn't live up to its name but actually exacerbates the problem.

What are the tools, then, in your toolbox? You get back in the next week or 2, you talk to your colleagues, and now it's on your desk. How do you start getting your arms around this? What do you do starting on Monday, or next Monday?

I try to lay out the basic numbers. That's what I was talking about. My prepandemic goal of spending—Clinton, if you use that process, would go from $1.7 trillion to $5.5 trillion. That's how you plus it up there. That would be Obama at $6.2 trillion, to Trump's 2019 $6.5 trillion.

Now you've got a baseline budget. You've always heard these Republican members of Congress running for office saying, “We're going to go to zero-based budgeting.” They're not even willing to go to a $5.5 trillion to $6.5 trillion baseline budget.

So again, what is the process that just might work? DOGE has kind of shown it to us: line by line, you have to scrutinize all this. It takes a lot of work. It takes a lot of time. And that's why I've always argued for a multiple approach here, multiple steps.

Provide the border funding. I would just extend current tax law. Again, I would have voted for that. If we had been smart enough to use current policy back then, we wouldn't even be having this conversation. Extend current tax law. That takes an automatic, massive tax increase off the table. Increase the debt ceiling enough for a year to keep pressure on the process to do the work, to go line by line, and expose spending.

I've got to believe that when you've gone from $4.4 trillion to $7 trillion worth of spending, if you start scrutinizing that line by line, there would literally be hundreds of billions of dollars that the public wouldn't even know we're spending. The only people who would know would be the grifters who are sucking down the pork.

Mm-hmm. So, when you say the folks in the Republican Party aren't willing to do the hard work, it's just so obvious how big of a crisis we are in, and everyone's kind of being blind to it. I'm just trying to understand what it is that's keeping the blindfold on. Is it that there are donors? That there are constituents?

I'll give you an example. A couple of years ago, I went in for the Farm Bill review with the Senate Agriculture Committee in 2012, so a long time ago. We started talking about one of the agencies in the USDA, and it had 10,000 employees. I said, “Why does this make sense in a digital age?” The answer was, “It doesn't.”

It's like, “Well, why is the agency still running and employing all these people?” “Well, because the senators don't want to lose the jobs in their state, because that's 10,000 jobs split among roughly 7 states, and it's really important to those 7 states to keep those jobs.”

Is that the motivation—that there are economic dollars flowing into the states—that keeps the representatives and the senators from making the tough decisions? Is it that they're getting donor dollars? What's the real motivation here that's keeping everyone from tackling reality?

Well, again, as I pointed out, most don't even recognize the full reality. They don't know the numbers. I've heard it said—I didn't hear McConnell say it personally, but I've heard him say, “Show me a member of Congress who ever lost an election because they spent too much money.”

So there's no public pressure not to spend. People love tax cuts. People love free money. Collectively, as a society, we're whistling by the graveyard. Nobody wants to say that this is unsustainable, because to fix it is painful. You're going to have to reduce spending, and then you're very open to the political accusations, as you know, coming in: “We're trying to slash Medicaid for disabled children.”

No, we’re trying to preserve it for disabled children, trying to get the able-bodied, childless, working-age adults back to work and onto private-sector healthcare. But again, that’s a more difficult argument to make. It’s just the way the process plows on. We’ve never—as I said, there’s never been a process to actually control spending.

This is the way we’ve always done it. You come up to these deadlines, you put everything into one big bill, and you give people things that they have to vote for. You don’t want to default on the debt. You don’t want to increase taxes. So you bundle up those elements with a bunch of crap and twist people’s arms to pay for it while keeping them basically ignorant, because you never talk about the massive numbers, the massive problem that we’re really in.

I mean, people kind of know it, but as long as the press isn’t reporting on it, as long as the press isn’t connecting the dots—that massive deficit spending is why you can’t afford things, why the dollar you held in 2019 is only worth 80 cents versus the buck it should be. By the way, a dollar you held in 1998 is worth 51 cents.

So, again, we don’t teach people. There’s no public pressure in terms of reducing spending or reducing the deficit. There’s just virtually none. I mean, from conservatives right now, I’m getting it all the time: “Boy, make sure that you make no tax on tips permanent. Make sure you make no tax on overtime permanent.”

Well, first of all, we probably shouldn’t even be doing either of those. By the way, I’m all for no tax on cash tips. We can’t collect it anyway, so don’t even try. I’m all for that. But you’ve got to recognize that these other tax cuts aren’t going to grow the economy. They’re not going to focus on the one component that Bessent’s talking about: that we have to grow our economy.

I actually am very supportive of no tax on tips and no tax on overtime. The monetary cost of those things is relatively not that meaningful, and so they have a broad-based positive impact at a lower cost. That’s actually the reason why we should do it.

The thing that puzzled me was that when 50 or 60 people are constructing something, you get this bill that comes out of the House, which has the things that the president asked for, but with all of these other Christmas-tree ornaments hanging from it. It’s impossible to figure out what’s actually going on.

Well, I don’t even think it’s 50 or 60 people constructing this. I think it’s a much smaller group of people, and then you maybe have 50 or 60 chiming in on one issue or another. Let me push back on overtime with you, though. I ran a plastics operation on continuous shifts. If you’re going to have it operating 24/7, you need 4 shifts.

Part of the problem with no tax on overtime—first of all, no tax on some overtime—is that’s going to add to the regulatory burden. I wouldn’t want to be the accounting clerk having to keep track of that, but I know computers make it easier to do. But in public-sector employee unions, they refuse to go to 4 shifts because they like the overtime. They should be forced to go to 4 shifts because they burn out. Pay them more.

From my standpoint, having run a continuous-shift operation, I think there’s enough incentive paying time and a half, or double time on Sunday, for people to work. Income is income. I don’t want to segregate. I don’t want to socially or economically engineer through the tax code. That’s just part of that economic engineering through the tax code.

I love the fact that we’re focusing on working men and women. Great. But I would rather simplify the tax code for them and overall lower their tax burden. But again, lower the rates, broaden the base. We’re not doing that. We lowered the rates and made it more complex.

So, yeah, we did not simplify the tax code in 2017. One of the reasons I actually wanted a 2-step process was to take time to simplify and rationalize our tax code.

Can we talk about other things that didn’t make it in that we thought were going to get in there? Another way to generate revenue would have been to close the carried-interest loophole. I don’t know if you have any points of view on that.

I’ve talked to numerous people who benefit from carried interest. I always ask them, “Can you explain to me why that’s not ordinary income?” And they can’t. It is ordinary income.

Speaking to other people who are pretty big into it, they do make a pretty powerful case that all these deals, all these structures, all these business arrangements are already structured that way. You can eliminate that break, and it’s really not going to raise any revenue. They make a reasonably convincing case there, too. So that’s kind of where we’re at on that, which is sort of at an impasse.

Yeah. My guess is it’s just not going to happen, right? And, kind of going to the overtime, it’s just not that big a revenue generator either way. It might make you feel good, could screw up the way deals are made, but is it really worth messing with?

One of the things that Elon has been talking about recently is that we could be on the precipice of an energy deficit starting next year, where we need every form of power possible to be generating as many electrons as possible. So, solar, wind, coal, natural gas, nuclear—there were a bunch of provisions here that changed the tax incentives. What are your thoughts on all of those that may change the landscape of electron availability?

Well, I think it’s insane that we’ve been shutting down coal-fired electrical generation. We need a lot of it. I would really focus on nuclear myself. I think that if you’re concerned about climate change—and, yeah, I’m not. We’ll adapt—but nuclear would be the thing we ought to be pushing.

I really don’t want to subsidize energy production. I don’t want to subsidize anything. Again, I want a simple and rational tax code. So my approach would always be to simplify those things, and I don’t want to pull the rug out from under people. I mean, if we’ve subsidized things and people made investments based on certain things, I kind of respect that.

The comment that I made to my colleagues is that EIA came out with a report. It said 81% of the incremental energy that was generated in the United States was backed by some form of tax credits. This is not to judge; it’s just meant to say that financial actors go to where the incentives are.

And if we change them and take 81% of this incremental energy offline, and you can’t get a natural-gas turbine—for example, I’m going to announce on Monday that we’re building a 1-gigawatt data center that I’m funding in Arizona—I can’t get a natural-gas turbine until 2032. I can get nuclear from the state of Arizona, but that’s not broadly available everywhere.

And so there are these practical investment decisions that the financial community wants to make to keep America at the forefront. It’s a little murkier today unless the Senate understands these nuances and helps us, because if we can’t make these investments, then we’re just not going to do it.

I’d say Congress in general doesn’t understand what you’re talking about. Again, I said I don’t want to pull the rug out from under people. I understand investment because I was in business. But again, I want to move toward a simpler system.

And again, it’s insane what government—all the green new energy thing—it misallocates capital. Take a look at what’s happening in Europe, in Germany and stuff. They’re artificially driving up the cost of power. For what? I mean, it’s a fantasy. It’s a self-inflicted wound.

We’ve spent something like 5 or 6 trillion dollars globally on climate change. Again, whether you believe it or not, we haven’t moved the needle. That’s just 5 or 6 trillion dollars basically wasted. So again, I recognize the fact that we’ve wasted a lot of money. We’ve incentivized people for certain types of power. The solution would be to quit doing it long-term and let the marketplace provide as much energy as cheaply as possible.

Again, protecting the environment—I don’t want pollution—but the whole climate-change thing is—

I care about electron surplus and having an infinite supply of electrons, which is effectively the threshold issue between us and whatever form of abundance we’re going to find with robots, with going to Mars, with building AGI. The threshold issue is just: Do we have enough energy to do it all? And as long as we have that, we’re going to win. And if we don’t, China’s going to win.

Where it comes from, I really don’t care. But the reality with nuclear is that we can’t wait until 2035 for electrons to turn on. That’s just a nonstarter. So as much as we have to pay for the sins of the past—and the sin of the past is that we turned all that stuff off idiotically, to your point, because of some crying child—we now have to pay for the conditions on the ground.

I have a different question, which is I want to go back to Dave’s question on DOGE. Senator, there was a $9 billion rescission bill that went to the House, and unfortunately it didn’t make a lot of progress. What is the future of DOGE as you see it?

First of all, it was beneficial for no other reason than it exposed how oblivious and ignorant Congress was of all this waste, fraud, and abuse. I mean, that has value right there. It should have embarrassed every member of Congress, all these department heads, that this kind of spending, this kind of crap was going on and they weren’t doing oversight on it. They weren’t taking a look at it.

But I tried to get Elon’s attention, quite honestly, about this: Can you give me somebody in DOGE that I can work with? So that, as soon as you identify the spending, we can connect it to an appropriation account. We can connect it to a mandatory spending account, so we can actually codify it.

He didn't seem to have the time, and quite honestly, in a personal conversation, he said, “Well, we don't have to do that.” Well, we do have to do that. We've been hammering Russ Vought: send us a rescission package. Finally, he bundles up $9 billion. I think the last time I looked at DOGE's website, they were up to $165 billion. I think it's higher than that now.

They have fallen short of the goal. Listen, I'm not criticizing them for that at all, but the fact of the matter is, it has to be codified. Just putting it on the website is valuable, but we've got to bank the savings. Anything that's mandatory has got to be done through reconciliation; otherwise, it's got to be done through rescission.

Can you just explain that to us? What we see on the website, is that not saved? They've stopped contracts; they're no longer spending money that way, but the question is whether the president on his own can impound those funds.

So they may not be spent, but they're just going to be sitting out there as unallocated spending to be spent sometime in the future unless you rescind them. Again, that's the beauty of rescission and reconciliation. We don't need Democrats to help us there. We can do that with simple majorities in both the House and the Senate.

Again, it'll be pretty depressing. President Trump, in his first administration, sent up a $15 billion rescission package, and it was voted down in the Senate. 2 Republican senators voted against it, and my guess is they paid no political price for doing that. Any Republican who voted—or would vote—against the rescission package ought to pay a pretty huge political price for voting that thing down.

But it's going to take presidential leadership. He's got to be focusing on that. I'm sorry, I don't think President Trump—he's doing all kinds of great things—is focused on reducing spending.

Why do you think that is? Have you talked with his staff or him directly about it? Was this not as apparent to him and his staff as it is to you?

I just think they are overwhelmed. You see all the activity, and this just hasn't hit his radar yet. It's going to hit his radar here in the next few weeks because, again, he liked the concept—the slogan—of “one big, beautiful bill.” I don't think he was overly concerned with or understood what the details were.

I'm going to force him to take a look at the details. I'm going to force a discussion on spending.

It feels like we're about to enter some form of a papal conclave, where you and your Senate colleagues are going to go into a room. There's either going to be white smoke or black smoke. Can you walk us through the mechanics now? What will it be like when Senator Thune brings you together and you all caucus? How does this work now for you?

We've been in the Finance Committee, and we've been working on these things. But again, it's all about scores, right? I've got to point this out. You hear these scores, right? But they're divorced from reality; they're not tied to anything. It's like, “Okay, I got a score of 65.” Well, good. It's good if you're golfing; it's awful if you're bowling.

So you get all these scores, and they're divorced from reality. Again, the process is, by and large, a complete charade. Somebody else is going to write this thing, and it's going to be shoved down people's throats. What I intend to do is open it up and bring this to the light of day.

I've been doing it since January 1st, writing about 3 pre-pandemic levels—3 options on pre-pandemic levels of spending. Next column: here's a process, a line-by-line, deep-dive forensic audit. I'd love to take the DOGE team right now and just bring them over. Let's focus on this. Let's spend months doing this, but we'll need time. We'll need a 2-step process.

Literally, my last column put it all together—the big numbers—and this is why we have to do it. But again, you were following the debate in the House. Did you ever hear a $2.2 trillion average deficit being projected? $22 trillion, you know, $59 trillion in debt. Nobody. It's just $1.5 trillion. “Oh, that's a lot.” It's almost meaningless. It's a rounding error.

I'm going to force this debate. That's why I'm on your show here today. That's why I'm going to be doing Jake Tapper tomorrow. I'm bringing the numbers to the fore.

Senator, is there a hard line that you'll have? If we don't get this deficit level to X—because that's the focus, that's the objective, that's the primary objective at this point in time in this republic—will you say, “I'm a no vote”? Have you been that declarative about your position on this?

I've been pretty upfront. The first goal of this Republican budget reconciliation should be: don't add to the deficit, because that ought to be the first goal. Beyond that, what I've always said is I want a commitment to return to a reasonable pre-pandemic level of spending and a process to achieve and maintain it.

I'm reasonably open. I recognize we have to get the votes. So I always say I don't have a hard number, but what I've done is laid out these options. Right now, the hard number accepted and expected by a lot of senators—enough to not pass this until we achieve it—is $6.5 trillion of spending in 2026.

I can walk you through how you get to that point, but that's kind of the number. Right now, we're expected to spend about $7.3 trillion next year. So that implies about $800 billion in deficit reduction, rather than the $1.5 trillion that the House has in its meager House reconciliation bill. It's a pretty big delta.

What scoring do you go off of? Is that the CBO scoring that you would use to make that estimate? Some of the conversation we've heard is that the revenue effects of some of the new programs are not taken into account fully. There may be revenue coming in from tariffs. There may be revenue coming in from the sale of the Trump immigration card at $5 million a pop, and there's a limited effect of the tax cuts on GDP growth, et cetera.

So there are a lot of arguments to be made to make the line seem a little more blurry than perhaps the scoring might indicate.

That's why, to try and simplify things, I'm focusing on spending. We went from $4.4 trillion to—it'll be $7.3 trillion next year. Let's bring it down to a reasonable pre-pandemic level: $6.5 trillion in spending. Spending, spending, spending.

I voted for President Trump because I wanted him to defeat the deep state. You don't defeat the deep state by continuing to fund it at Biden's levels. The minute you start bringing revenue in, nobody can project that. Nobody knows exactly what the impact is going to be, and so that starts muddying the waters.

I focus on spending. I don't really want to fund the deep state. I would like to bring certainty to the economy. I'd like the trade wars to end so we can bring that level of stability. I don't want to increase taxes.

Again, my approach would be a multiple-step process: border defense, bank the savings, and take whatever good work the House did—bank that. Extend current tax law, as awful and as complex as it is; just extend that. Increase the debt ceiling for 1 year to put pressure on us to come back and do the work on spending.

Then we can bring up President Trump's tax cuts as well. I would keep this as simple as possible, get it passed, and start doing the work.

Do you think there's any upside or legislative resolve to think about monetizing assets? For example, Secretary Lutnick has talked about the vast resources America has. Secretary Burgum has talked about them as well, whether we should consider monetizing some of those things—selling federal land, selling drilling rights, selling royalty rights. What do you think about that as an incremental way of softening the landing here?

I would say the only reason I'm not in a full-fledged panic is because people like Art Laffer do point out that we have vast wealth. Our debt-to-GDP ratio is probably not the most relevant. It is relevant for inflation and that type of thing, but debt-to-total-assets is probably more relevant.

We literally can afford this level of debt, but you have to compare it to income as well—our ability to service the debt and the debt spiral. So again, this all ends up being a lot of different factors coming into what's going to make it possible for people to live.

Inflation is probably the one metric that we need to avoid. I think that's the thing that I'm most concerned about in terms of debt and spending. I'm not concerned about America going bankrupt because we have this vast wealth. I'm concerned about us being insolvent, sparking massive inflation, wiping out people's savings, and making it impossible for them to live and retire.

What do you think is the future through these next 16 months of bills and the impact? To your point, there are a lot of people who came together in a coalition to vote for accountability, to defund and to starve the deep state. If we continue to feed it, it seems like a traditionalist default. We're going back to the way things were. Can you talk to us about that and what your thoughts are about that?

I'm highly concerned about the conservative movement. I think Trump is a completely unique political figure. I think he definitely did drive turnout. He's expanded, certainly, our base, which, by the way, is one of the reasons I am sympathetic to what you're talking about in terms of the tax cuts he's proposed.

I mean, we need to focus on the working men and women of this country. That is really the Trump coalition. But I'm concerned about how effective Democrats are—the coalition they've made up of the media, primarily social media companies, that type of thing, and their relentlessness in letting all these undocumented people into this country who are voting. We're starting to see that type of fraud, that they are trying to cheat. I think they do cheat in voting. I think we don't have a real feeling for the order of magnitude of their cheating.

A quick example: We had that important Supreme Court race here. Elon Musk came in, did some pretty innovative things, and spent a lot of money here. The liberal candidate got 78% of Kamala Harris's vote. The conservative candidate got 62% of Donald Trump's vote, even though we were all out there saying how important this was. If you don't want to see President Trump impeached by a Democrat-controlled Congress in the next Congress, you've got to get out and support President Trump. That didn't resonate. Again, 78% of Democrats came out versus 62% of Republicans.

Do you think there's a risk that MAGA becomes a version of Tea Party 2.0, where it starts with energy, but then the gravitational pull of the establishment is just too strong for the rebels to fight off?

No, I think the greatest danger of MAGA is that it's really tied to one individual. The Tea Party movement was tied to the vision of America: freedom, debt and deficits, not mortgaging our kids' future. I think that survived. They did a pretty good job of marginalizing the Tea Party, but we're alive and well. We're the House Freedom Caucus. We're the people who are going to stop this until we get a much better bill in the Senate.

So we're still alive and well. But in terms of voters, the Tea Party pretty well merged with the Republican Party. I'm not sure all the MAGA voters aren't just disgusted by the whole process, as I am. They're much more likely to sit on the couch unless their guy is on the ballot.

Do you think that our model of representative democracy is broken and has the same sort of inevitable outcome that others have had in the past—that ultimately people realize they can vote themselves all the money, and they do, and the system breaks? If you were to go back and be a Founding Father, what would you have done differently here? Or am I off on this?

No, I'm not sure you're off at all. I think we may have already passed that hinge point. That's my concern. People ask me, “Are you optimistic?” No, I'm a pessimist. I'm looking around. That is the death knell of a democracy or republic: A majority of the voters realize, “Hey, I can vote myself benefits. Don't worry about the debt and deficits. We can print money.” That's what brings down everything.

This is what I've noticed: Democrats, Republicans, populists, or elitists—whatever side of the spectrum, on whatever dimensional category you want to assess an individual or representative on—at the end of the day, they're just trying to use the government to deploy capital to their constituents as best they can. That's the mechanism of the electorate at this point.

Hearing your words resonates with me because I've made a number of visits to D.C. in the last couple of months since the inauguration. There were a lot of proclamations about DOGE and how it was a new day in Washington, and I felt a degree of optimism and hope that things were changing in D.C. But every member of Congress I sat down with was a disappointing conversation that reflects the views you just shared: They don't really understand what's going on, and they don't really care. It's not a priority to solve the fiscal crisis that we're in, and they're not willing to admit it. It's like a stage 4 terminal patient not willing to admit that they're sick and need to take some therapy.

Well, the data that backs us up is—and I wrote this in my Wall Street Journal column—in 1930, the federal government spent about 3.5% of our GDP. 3.5%. State and local governments were about 9.1%. That was the foundational premise of America: government close to the governed, where it's more effective, more efficient, and more accountable.

Now we're spending close to 24% at the federal level. States are probably somewhere between 12% and 15%; I haven't looked at that recently. And as Lord Acton pointed out, power corrupts. Government is power. That really is the definition of government: power. So it gets corrupted, and it's been corrupted. I fear we're past the point of no return.

Why did I run again for a third term? As disgusted as I am with this process, I couldn't turn my back on this country. I can't give up on it. I'm not overly optimistic. Again, it's not just that, as government grows, your freedom recedes. As government grows, you get more and more people dependent on it.

Well, that's right. And they're not doing things productively. You don't have a vibrant economy.

That's right. All in all, it is destructive of society.

To the point about your numbers, Senator, I've talked about this on our show, where I've tried to estimate what percentage of Americans gain their employment through a government paycheck, by servicing the government, or through a government contractor. I think it's probably at 50% today.

So 50% of Americans are either working for a public agency—federal, state, or local—or working for the contractor of a government agency. That's where you pass the tipping point, where it's no longer possible to bring down the spending because, at that point, everyone in a representative democracy has every incentive to keep it up. Otherwise, they will individually lose, not just have something individually to gain. That's where I worry we're at.

I guess the hardliners like yourself may be the last line of defense here, but that's where I was really curious to hear how far you're willing to take this in this particular reconciliation bill process that's about to hit your desk in the next couple of weeks. Who else is shoulder-to-shoulder with you and has the same point of view in the Senate?

Well, I think Rand Paul is pretty much a hard no, regardless. Again, I don't think you could get a good enough bill where he'd vote yes. My other allies, for sure, in this thing are Mike Lee and Rick Scott. Each one of us has our own thoughts. One may accept something different than the others. I'm pretty well dug in, but I'm reasonable. You give me something that, as I say, commits to getting to pre-pandemic levels of spending and establishes a process to achieve and maintain it, and I'll work with you.

One of the things I did—and we had it pinned to the top of my X page; I think it's further down now—but I put together a video about 1 minute 30 seconds long, starting with President Trump at the State of the Union saying he was going to balance the federal budget, and then the vice president and everybody on down saying some version of, “We don't have a revenue problem; we have a spending problem.”

At the very end of the video, I ask, “So, are we willing to fix it?” Right now, it doesn't appear we are, but I intend to insist that we do. I'm going to dig my heels in. There's nothing that President Trump can do to pressure me other than start working with me. Acknowledge the numbers.

I'm texting Scott Bessent, Kevin Hassett, and Russ Vought all the time, saying, “Here's my viewpoint. What am I not getting right?” So they know exactly what I'm thinking. They know exactly my concerns. They know exactly the numbers. I had a good, nice lunch with Scott Bessent in the Treasury Department. I gave him my charts and graphs, all that kind of stuff. He asked for the electronic versions of those so he could distribute them to the Treasury Department. None of this should come as any surprise to anybody.

And the number, from your perspective, if you had to create a hierarchy just in your messaging, is the number we should take away that we're about to balloon the debt to $60 trillion to $70 trillion? Call it $65 trillion at the midpoint. Is that the number we should be focused on?

I first focus on spending. Okay, 89.3 trillion. Again, that represents government, right? That represents the power that's been corrupted. That represents the unprecedented, other than World War II, increase in spending from 2019 of 58% to 60%.

If you can't deal with that, as I pointed out in my column, our forefathers, the Greatest Generation, under responsible leadership, entered World War II spending about 11.7% of GDP. They ramped that up to 41% during the war. By 1948, they were down to 11.4%. So it's entirely possible, but you need leadership. I need the president of the United States.

By the way, I've been in the White House with him. I've shown him my charts and graphs. He goes, “I love this. I love this. The House ought to love this. Has this been presented?” I said, “No, Mr. President. Let's go to the House. Let's present this.” He didn't do that.

We need President Trump to embrace the reality that we are spending way too much money. He was elected to defeat the deep state. You don't defeat it by spending at these levels. He needs to see the detail. Again, to be charitable, I think he's been so busy doing so many other wonderful things that I support, he hasn't focused on this. I'm going to force him to focus on this.

Do you think this will be the moment? And so, when you speak with Scott Bessent, does he think he can get the president there as well? I always think back to Bill Clinton with his balanced-budget economic poster boards that he put up, right? Here are the simple charts; let me explain it to you, and every American could watch that on television and understand what he was talking about, nod their head, and Congress and the entire populace went along with it. Do we need that? Do we get that moment, do you think?

Yeah. Again, I don't think the numbers are that complicated. Point them out: $22 trillion of additional deficit spending. That's a rosy scenario. That's $2.2 trillion per year. Obama averaged about $900 billion a year in deficit spending. Trump, before the pandemic, was about $800 billion. Biden's up to almost $1.9 trillion in average deficit spending. Clearly unsustainable. We've got to get back to a reasonable level.

And by the way, if we do, I think the bond markets would rejoice. We wouldn't be looking at a ramping up of interest costs. We can talk about debt to wealth as opposed to debt to GDP because we've got that monkey off our back.

You said something interesting that I just want to come back to, which is that you said when the government absorbs all the dollars in the system, there are fewer and fewer dollars left for private industry. Just to build on this, one of the things that I brought up at the beginning of this year is that the most important thing you need is tail insurance. Tail risk needs to get managed at the beginning of this year.

There's a very important market that is a gauge of that for private industry, which is called credit default swaps. What is the risk of private industry not being able to pay back its obligations? Unfortunately, through the course of this year, we've seen the cost of that insurance ramp. But at the beginning of Liberation Day, there was some relief because people saw a path out of this. Unfortunately, we're back to almost near highs. And it is the market signaling that first we'll go private industry, and then the second will be the repricing of the risk for the US government.

And I think if people can really understand that that's the cascade, to your point, that first card has unfortunately been turned over. Now, we haven't seen the implications on Main Street of that, but that's what we need to avoid. We need to get these markets to understand the bigger picture, but we need to show them something.

And we also have to focus on economic growth through the private sector, right? Not fueled by government deficit spending. I don't know what percentage of our actual growth came from $2 trillion-a-year deficits. I think a pretty good chunk. So, have we really had real private-sector growth? I think we have, but not as much as I think the headline numbers suggest, because so much of it has been fueled by the government.

By the way, that's also true in terms of revenue coming from the government. It is true that we beat the CBO estimates, but that's because of trillions of dollars of deficit spending starting in the pandemic years, followed through with Biden. Prior to the pandemic, we weren't really matching even the CBO's downgrade of revenue coming in after the TCJA. We weren't hitting it.

But then you had COVID hit, and again, trillions of dollars in deficit spending that also boosted revenue. So again, all these people saying, "That tax increase is going to be dynamically scored and it's going to pay for itself." Listen, I'm all for dynamic scoring, but let's be realistic. And again, I'll point out the CBO projection I'm dealing with: $22 trillion. That assumes we go from 17.1 to 18% of GDP in terms of revenue. So, if we don't cancel the tax increase and there's a dynamic-scoring effect, it just means we don't hit 18.1%, and that number is still lower.

Talk to us about the setup for 2026, and maybe, if you want, your thoughts about where the country goes into 2028. One of the things that Dave talks about a lot is moments that galvanize some form of populist socialism—this idea, as he said very articulately, "I can just vote myself the money, so who's going to just give me the most money?" Can you just walk us through some political forecasting for us?

That's why I'm not an optimist. But I've heard people rationalize this, and I mean important people rationalize it: "Just go along with this. Get us the bill. I mean, this is what we have to do to win the majority, maintain the majority in the House in 2027," right? What good is a majority if you literally don't solve the problems that you're aware of?

"What good is it? When we have the majority in 2027, then we're going to actually turn the spending curve down. That's when we're going to return to pre-pandemic-level spending." I don't buy it. This is our one opportunity, and right now we're blowing it. I'm going to do everything I can to make sure we don't blow it.

But again, that is the reality. Listen, I don't discount the fact that we may lose the House, we may lose the Senate, but I would say we do that because we're not solving these problems. We're going to be looked at as unserious. Our base is going to go, "What? Why did we elect you guys? You didn't take the bull by the horns. You didn't solve this problem. You're really no better than Democrats." I think we have to be concerned about that.

If this reconciliation bill gets done, Senator, in the next couple of weeks, what bill would you hope to see next to get to that north star of fiscal responsibility? Is there a rescission bill that you'd be looking for? Do we need to actually have a sit-down and talk about building a budget? What's the right next step here in creating a north star that creates stability for the republic?

Again, it's developing a process that will achieve and maintain pre-pandemic-level spending—a lower spending level. I come from a manufacturing base, right? You can't have a good product without a good process, and we've just never had that process. The only one I can think of is what DOGE has demonstrated does work in terms of the public supporting us in eliminating just awful spending. So, you have to expose it. You have to go line by line.

Again, there are thousands of lines, just top lines in the federal budget. Hundreds of thousands of lines are under each one of those as well. So, you have to do the work. And again, I would love to take that DOGE team, those geniuses with all their AI and their computer skills, and get 100 or 200 forensic auditors and just go through this line by line.

And again, my proposal was having this budget review panel: senators, House members, members of the administration, OMB. Then you basically set up the process just like you do in a business. Here's your budget review sheet. Then you bring the department heads and their financial gurus in front of this budget review panel. Justify your spending.

But again, I would be comparing it to outlays under Clinton plus-ups, outlays under Obama plus-ups, and outlays under Trump plus-ups. Go through every line and ask, first of all, why are you spending more than even Trump? Why are you spending more than Obama or Clinton? Plus, why are you spending any money at all on this? But you have to go through the work. So, you need the time.

I've been proposing this now for months. Nobody's put in the effort. OMB said, "We don't have enough time." And I realize they're busy. The House said, "No, we've been working on this for a year. We're satisfied with our numbers. We didn't have the time." The Senate—really, Senate leadership—is the only one that's been fully behind what I'm trying to do here.

But we can't do it alone. I mean, I can't do it. I don't have the budget expertise. So, it really is about getting the commitment of the president that he is determined to not keep funding the deep state at these levels, return to a reasonable pre-pandemic level of spending, and then get his OMB fully behind this effort. This has got to be the biggest effort on the budget ever. Then set the thing up, show it works, and hopefully maintain it over the years. I can't think of anything. We've tried all this other stuff, and it never worked.

Well, look, I hope you find a path toward that goal, Senator. I think it's a critical time. And speaking as an American, I appreciate your resiliency in the face of what I'm sure is a lot of political pressure and tension right now in trying to make sure that the right thing is done here for the long-term prosperity of America. So, thank you for your service. Thank you for the work you do. We appreciate it.

I appreciate you having me on. I will say one thing that is different about me from others: I'd rather go home. That's a significant difference. I'd rather return to my private-sector life than keep serving here in this total dysfunction. That, again, is why I can't be pressured by President Trump.

I can't—I mean, he's not going to flip me just by the force of his argument or any kind of political pressure. There's no pressure he can apply to me. He's willing to sit down with me, look at the numbers, acknowledge them, and work toward a reasonable plan. That's the only way he's going to get my support.

Well, I hope that there are others who get into the same mindset as you. I've always found it off-putting that folks choose to be politicians as a career rather than rotating in and out, doing this as a service, and then going back into the private sector, where I think a lot of the misalignments and conditioning can be avoided.

So, yeah, I appreciate that mindset, and thank you. Thank you, Senator, for your candor.

Thanks for having me on.

Transparency. Thank you.

I mean, my conclusion today is similar to how I finished the pod yesterday, which is concern that the bond market is not going to take this well. I do think that puts a lot of pressure on America, and I think it’s going to put pressure on private industry. What will happen as a result is not necessarily that we go bankrupt or whatever, but there is no clear dividing line between public and private industry, and I don’t think that’s a great outcome.

Not to mention the value of everyone’s assets. They go to zero. They go to zero. Well, look, as the senator made the point, a dollar in 2019 is worth 80 cents today because of the inflation we’ve experienced from the rampant spending since COVID. If that continues, which is the steady state that we’ve now assumed—we’re now assuming emergency spending will continue as if it’s standard—then that same level of decline in the value of a dollar, or decline in the value of any American asset, will continue, and it will only accelerate.

I think the worry is that in 10 years, a dollar is worth 30 cents. And that makes it harder for everyone to prosper in America. The ability to buy a home, the ability to have greater wealth, the ability to improve your conditions and your livelihoods are significantly diminished. That’s the biggest consequence that we’ve seen many times over the last couple of centuries as countries have gone through the same cycle that the American republic now finds itself in.

This is kind of one of those last stands of the Alamo, if you will, because the arithmetic gets to the point that it becomes unstoppable. This train is gone. So, anyway, I thought it was great to have some time with the senator to talk about it today.

Again, when we have these conversations, Chamath, obviously, we’re not fully endorsing all the views and points of view. It’s good to hear from people. It’s good to understand their point of view, let them speak, and have the conversation. There are things that we’ll agree with and things that we don’t agree with.

But I think on the fiscal condition of the United States, I’ve been pretty clear and pretty vocal on my point of view on this. On this particular point, I think the senator is a very important voice. I think it’s really important for America to let private citizens have agency and do the things that they think they should be doing. If you move to a place where we become fiscally crippled and reliant on the government, that’s a horrible outcome.

Yeah, absolutely.

Okay. Well, I’m glad we did this. I know it was a push to get it done on a Saturday, but I thought it was really worthwhile.

I already made love to Nat twice this morning, so I’m fine. All the boxes have been checked.

But what did you do after those 6 minutes? Did you play with the kids?

Played with the kids for an hour.

Yeah. So I’ve done everything I need to—walk the dogs.

Good.

Yeah. All right, bro. We’ll talk. Love you.

I'm going all in.