June 4, 2025 • 8 mins
Peter Welch, Democratic Senator of Vermont, talks about the Congressional Budget Office (CBO) projections on President Trump's 'Big Beautiful Bill' and tariffs revenue. He spoke to Bloomberg's Joe Mathieu and Kailey Leinz.
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Episode Transcript
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Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news. Democratic Senator Peter Welch
of Romani's a member of the Senate Finance Committee, and
it's great to have you back, Senator on Bloomberg TV
and Radio. I'd like to start with the CBO, since
we were just talking to Senator Haggerty about that. It
is quite the dual headline today. The tax bill would
(00:22):
add two point four trillion to US deficits. But at
the same time, the CBO is estimating that Donald Trump's
tariffs could cut the budget gap by even more two
point eight trillion dollars. So will tariffs pay for the
tax cuts?
Speaker 2 (00:36):
No, I mean I actually see it exactly the apposite way.
It's five point two trillion dollars is essentially going to
be added to the deficit. Here's how okay, Dave CBO
says it's a two point four trillion deficits buster right now.
The tariffs. The question on tariffs is who pays? Are
those paid by foreign governments? That's essentially what President Trump
(01:00):
is asserting. But when I talk to folks of farmers,
they're paying twenty five percent more for their fertilizer. When
I talk to steel manufacturers that you steal, they're paying
fifty percent more. So that revenue is a tax that's
paid by our businesses, in by our consumers, and you're
seeing the President trying to shield that by telling Walmart
(01:23):
to eat it. They're not going to do it any
more than any other supplier can, So that's really bogus.
Everybody knows we're going to pay those tariffs.
Speaker 3 (01:33):
Well, as we consider the way in which Tariff's senator
factor into this revenue picture, knowing there could be revenue
lost as a result of these tax cuts, it is
worth noting that taxes are not the only thing in
this one big, beautiful bill. It also is intended to
raise the debt ceiling by four trillion dollars, at least
the version that passed the House, and President Trump today
suggested the debt ceiling should be abolished entirely, actually saying
(01:55):
he agrees with your colleague, Democratic Senator Elizabeth Warren of Massachusetts,
who we spoke with about that earlier today. This was
her live reaction, Sir, let's listen together.
Speaker 4 (02:05):
I think that Donald Trump and I hey listen, I'm
ready to join up with him and make that happen.
We need to get rid of the debt ceiling altogether,
not extend it. Not say ooh, while this is going
on this budget negotiation, let's just roll out a few
trillion dollars more in the debt ceiling. Nope, that has
(02:27):
gotten us into trouble before, it continues to get us
into trouble. Donald Trump is right, let's get rid of
it all together.
Speaker 3 (02:35):
Is this an effort you too would sign on to?
Speaker 2 (02:37):
Senator You know, I think the debt's healing is a
bit of a sideshow here at this moment. The question really,
with or without the debt sealing, should we be raising
the debt by two point four trillion dollars when we're
going to pay for that by kicking sixteen million people
off of healthcare on the Medicare program, where we're going
to make folks who are on the Affordable Care Act
(03:00):
lose it because they won't be able to afford it,
when families that depend on nutrition benefits in the SNAP
program are going.
Speaker 4 (03:07):
To lose that.
Speaker 2 (03:08):
So, you know, what I see here with the economic
policy of Trump is one tax cuts that are not
going to be pro growth. I do disagree with Senator
Hagriy to a deficit that is going to result in
higher interest rates. It means higher car payments for folks,
higher cost of mortgages, and of course any businesses that
want to borrow money, you're going to pay more. So
(03:28):
when I'm concerned about it is not the policy of
the debt ceiling. I'm concerned about the policy of fiscal
policy of increasing the debt that's going to increase our
interest rates and doesn't go into any productive pro growth activities.
Speaker 1 (03:45):
Senator, I know you're joining forces with the aforementioned Elizabeth
Warren on an inquiry into Republicans' effort to use something
called the current policy baseline. Our audience here on Bloomberg
is pretty familiar with it at this point. It essentially
sets the baseline for this entire construct. When it comes
to how to pay for these tax cuts, you're arguing
(04:07):
it amounts to magic math and a sleight of hand.
This was back in February when the inquiry was launched.
What have you come up with?
Speaker 2 (04:16):
This is a political debate where we're the proponents of
the tax cut are trying to make it appear as
though it's not going to result in a deficit by
doing essentially magic accounting. I mean, the bottom line here
is we should have an on the level debate. The
CBO says this will add two point four trillion dollars
to the deficit. So the question is it worth it?
(04:37):
What are we going to get out of it?
Speaker 4 (04:39):
Who's who's going to lose?
Speaker 2 (04:41):
That's really the heart of this question.
Speaker 3 (04:45):
Well, as we consider the CBO score not just of
this bill, but what you were speaking about a moment ago, Senator,
they're scoring on tariffs as well, who ultimately will bear
the cost of them? I would like to ask you,
given you were just part of a congressional delegation to
Canada over the mo Memorial Day recess, about Canada in particular,
as earlier today we spoke with Danielle Smith, the Premiere
of Alberta, and this is what she had to say
(05:07):
about the prospects of trade negotiations going well between our
two countries.
Speaker 5 (05:14):
In Canada, there's optimism. I just this week met with
my counterparts, the thirteen premiers as well as the federal
Prime Minister. And because we've got G seven taking place
in the coming weeks in my home province of Alberta
in Kanadascus, I think that everybody's hopeful that it would
be really nice, either just before or during or just
after to announce that there has been some kind of
(05:34):
Dayton or interim step towards getting to a comprehensive renegotiation
of trade.
Speaker 3 (05:41):
Senator, did you leave your trip to Canada feeling like
they are ready to make a deal and do you
think the same of the Trump administration?
Speaker 2 (05:48):
Well, the tone that I just heard is the tone
I heard there. They regard themselves as our closest allies,
and I regard us as their closest ally, especially those
of us like Kevin Kramer North Dakota on the border,
me Vermont Senator Sheehan on the border. But the reality
is there was really significant heartburn on the part of
(06:09):
Canadians with the fifty first state discussion, the Governor of
Canada discussion. And what is happening right now is our farmers,
like in Vermont three pans twenty five percent more for
their fertilizer and their tight margins. They can't make it.
Our tourism is collapsing with the Canadians. Senator. She mentioned
that the manufactured products that used to be going to
(06:32):
Canada from New Hampshire are really way down. So the
real world impacted these tariffs is affecting business. The other
thing that's really problematic is the President has changed his
tarror policy twenty two times already. And what I hear
from business is we were down at Corvis in southern Vermont.
There's no way they can plan with this constant situation
(06:56):
up and down. The business folks wake up, they look
at the news, or they try to find from whatever
source they can't what are our teriffs today? And folks
who have products coming in on a boat they don't
know whether they're accept delivery because of the ever changing
nature of these tariffs. So the chaos is really tough.
Speaker 1 (07:14):
Well, if in fact we are on track to some progress,
your Senator, just to get back to the question, is
there any chance you could see the framework of a
deal or something more robust around the G seven of
the weeks ahead?
Speaker 2 (07:28):
You know, the reality is none of us know. You know,
I know as much as you know. So we ask
somebody and we get some the latest information. We read
what's on the news and what's on the blurs. But
the fact is there's been no coherent policy that has
been sustainable. That's the constant changing so in truth, none
of us know, and as important that I know, it's
(07:50):
really important that a farmer knows what are they going
to pay for fertilizer, really is important. What a manufacturer
knows what they're going to have to pay for steel
or aluminum, and stability is so essential. And it doesn't
matter whether you're a Republican business that might have voted
for President Trump or of a business where you voted
for Harris. The bipartisan nature of this policy is to
(08:12):
inflict pain on everyone.
Speaker 3 (08:15):
All right, Senator, we appreciate you joining us. Democratic Senator
Peter Welch of Vermont, thank you for your time
Bloomberg Audio Studios, podcasts, radio news. Democratic Senator Peter Welch
of Romani's a member of the Senate Finance Committee, and
it's great to have you back, Senator on Bloomberg TV
and Radio. I'd like to start with the CBO, since
we were just talking to Senator Haggerty about that. It
is quite the dual headline today. The tax bill would
(00:22):
add two point four trillion to US deficits. But at
the same time, the CBO is estimating that Donald Trump's
tariffs could cut the budget gap by even more two
point eight trillion dollars. So will tariffs pay for the
tax cuts?
Speaker 2 (00:36):
No, I mean I actually see it exactly the apposite way.
It's five point two trillion dollars is essentially going to
be added to the deficit. Here's how okay, Dave CBO
says it's a two point four trillion deficits buster right now.
The tariffs. The question on tariffs is who pays? Are
those paid by foreign governments? That's essentially what President Trump
(01:00):
is asserting. But when I talk to folks of farmers,
they're paying twenty five percent more for their fertilizer. When
I talk to steel manufacturers that you steal, they're paying
fifty percent more. So that revenue is a tax that's
paid by our businesses, in by our consumers, and you're
seeing the President trying to shield that by telling Walmart
(01:23):
to eat it. They're not going to do it any
more than any other supplier can, So that's really bogus.
Everybody knows we're going to pay those tariffs.
Speaker 3 (01:33):
Well, as we consider the way in which Tariff's senator
factor into this revenue picture, knowing there could be revenue
lost as a result of these tax cuts, it is
worth noting that taxes are not the only thing in
this one big, beautiful bill. It also is intended to
raise the debt ceiling by four trillion dollars, at least
the version that passed the House, and President Trump today
suggested the debt ceiling should be abolished entirely, actually saying
(01:55):
he agrees with your colleague, Democratic Senator Elizabeth Warren of Massachusetts,
who we spoke with about that earlier today. This was
her live reaction, Sir, let's listen together.
Speaker 4 (02:05):
I think that Donald Trump and I hey listen, I'm
ready to join up with him and make that happen.
We need to get rid of the debt ceiling altogether,
not extend it. Not say ooh, while this is going
on this budget negotiation, let's just roll out a few
trillion dollars more in the debt ceiling. Nope, that has
(02:27):
gotten us into trouble before, it continues to get us
into trouble. Donald Trump is right, let's get rid of
it all together.
Speaker 3 (02:35):
Is this an effort you too would sign on to?
Speaker 2 (02:37):
Senator You know, I think the debt's healing is a
bit of a sideshow here at this moment. The question really,
with or without the debt sealing, should we be raising
the debt by two point four trillion dollars when we're
going to pay for that by kicking sixteen million people
off of healthcare on the Medicare program, where we're going
to make folks who are on the Affordable Care Act
(03:00):
lose it because they won't be able to afford it,
when families that depend on nutrition benefits in the SNAP
program are going.
Speaker 4 (03:07):
To lose that.
Speaker 2 (03:08):
So, you know, what I see here with the economic
policy of Trump is one tax cuts that are not
going to be pro growth. I do disagree with Senator
Hagriy to a deficit that is going to result in
higher interest rates. It means higher car payments for folks,
higher cost of mortgages, and of course any businesses that
want to borrow money, you're going to pay more. So
(03:28):
when I'm concerned about it is not the policy of
the debt ceiling. I'm concerned about the policy of fiscal
policy of increasing the debt that's going to increase our
interest rates and doesn't go into any productive pro growth activities.
Speaker 1 (03:45):
Senator, I know you're joining forces with the aforementioned Elizabeth
Warren on an inquiry into Republicans' effort to use something
called the current policy baseline. Our audience here on Bloomberg
is pretty familiar with it at this point. It essentially
sets the baseline for this entire construct. When it comes
to how to pay for these tax cuts, you're arguing
(04:07):
it amounts to magic math and a sleight of hand.
This was back in February when the inquiry was launched.
What have you come up with?
Speaker 2 (04:16):
This is a political debate where we're the proponents of
the tax cut are trying to make it appear as
though it's not going to result in a deficit by
doing essentially magic accounting. I mean, the bottom line here
is we should have an on the level debate. The
CBO says this will add two point four trillion dollars
to the deficit. So the question is it worth it?
(04:37):
What are we going to get out of it?
Speaker 4 (04:39):
Who's who's going to lose?
Speaker 2 (04:41):
That's really the heart of this question.
Speaker 3 (04:45):
Well, as we consider the CBO score not just of
this bill, but what you were speaking about a moment ago, Senator,
they're scoring on tariffs as well, who ultimately will bear
the cost of them? I would like to ask you,
given you were just part of a congressional delegation to
Canada over the mo Memorial Day recess, about Canada in particular,
as earlier today we spoke with Danielle Smith, the Premiere
of Alberta, and this is what she had to say
(05:07):
about the prospects of trade negotiations going well between our
two countries.
Speaker 5 (05:14):
In Canada, there's optimism. I just this week met with
my counterparts, the thirteen premiers as well as the federal
Prime Minister. And because we've got G seven taking place
in the coming weeks in my home province of Alberta
in Kanadascus, I think that everybody's hopeful that it would
be really nice, either just before or during or just
after to announce that there has been some kind of
(05:34):
Dayton or interim step towards getting to a comprehensive renegotiation
of trade.
Speaker 3 (05:41):
Senator, did you leave your trip to Canada feeling like
they are ready to make a deal and do you
think the same of the Trump administration?
Speaker 2 (05:48):
Well, the tone that I just heard is the tone
I heard there. They regard themselves as our closest allies,
and I regard us as their closest ally, especially those
of us like Kevin Kramer North Dakota on the border,
me Vermont Senator Sheehan on the border. But the reality
is there was really significant heartburn on the part of
(06:09):
Canadians with the fifty first state discussion, the Governor of
Canada discussion. And what is happening right now is our farmers,
like in Vermont three pans twenty five percent more for
their fertilizer and their tight margins. They can't make it.
Our tourism is collapsing with the Canadians. Senator. She mentioned
that the manufactured products that used to be going to
(06:32):
Canada from New Hampshire are really way down. So the
real world impacted these tariffs is affecting business. The other
thing that's really problematic is the President has changed his
tarror policy twenty two times already. And what I hear
from business is we were down at Corvis in southern Vermont.
There's no way they can plan with this constant situation
(06:56):
up and down. The business folks wake up, they look
at the news, or they try to find from whatever
source they can't what are our teriffs today? And folks
who have products coming in on a boat they don't
know whether they're accept delivery because of the ever changing
nature of these tariffs. So the chaos is really tough.
Speaker 1 (07:14):
Well, if in fact we are on track to some progress,
your Senator, just to get back to the question, is
there any chance you could see the framework of a
deal or something more robust around the G seven of
the weeks ahead?
Speaker 2 (07:28):
You know, the reality is none of us know. You know,
I know as much as you know. So we ask
somebody and we get some the latest information. We read
what's on the news and what's on the blurs. But
the fact is there's been no coherent policy that has
been sustainable. That's the constant changing so in truth, none
of us know, and as important that I know, it's
(07:50):
really important that a farmer knows what are they going
to pay for fertilizer, really is important. What a manufacturer
knows what they're going to have to pay for steel
or aluminum, and stability is so essential. And it doesn't
matter whether you're a Republican business that might have voted
for President Trump or of a business where you voted
for Harris. The bipartisan nature of this policy is to
(08:12):
inflict pain on everyone.
Speaker 3 (08:15):
All right, Senator, we appreciate you joining us. Democratic Senator
Peter Welch of Vermont, thank you for your time
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