February 22, 2025 • 37 mins
Newt discusses federal budget spending priorities and the budget reconciliation process with Richard Stern, Director of the Grover M. Hermann Center for the Federal Budget at The Heritage Foundation. They explore the complexities of the reconciliation bill versus regular spending bills, the historical context and evolution of the reconciliation process, and the challenges of passing significant legislative changes in a divided Congress. Stern emphasizes the importance of bold leadership and public education on fiscal issues, drawing parallels between current political dynamics and historical figures like Andrew Jackson. Their conversation also touches on the impact of pork barrel spending and the need for a cultural shift towards fiscal responsibility and transparency.
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Speaker 1 (00:04):
On this episode of the News World. President Trump was
elected with a mandate to secure the border and enforce
immigration law, revitalize our national defense, on leish America's energy resources,
and cut wasteful and fraudulent government spending that has driven inflation.
To deliver on this agenda, Congress will need to fund
(00:26):
these priorities. Here to talk about the federal budget, spending priorities,
and the budget reconciliation process, I'm really pleased to welcome
my guests, Richard Stern, Director of the Grover M. Hermann
Center for the Federal Budget at the Heritage Foundation. Prior
to joining Heritage, Stern was a Congressional staffer for over
(00:48):
seven years. During that time, he served as a policy
staffer for the Republican Study Committee, where he was the
staff lead for their Budget and Spending Task Force and
spearheaded their work to create their Fiscal Year twenty twenty
and Fiscal Year twenty twenty two federal budgets. Richard, welcome,
(01:16):
and thank you for joining me the News World.
Speaker 2 (01:18):
Thank you for having me on today.
Speaker 1 (01:20):
I think it will be really helpful because, as you know,
this is very complicated, and so we want everybody to
have a sort of baseline knowledge. So let's just start
with it very simple. Can you explain the difference between
a reconciliation bill and a regular spending bill?
Speaker 2 (01:38):
Absolutely? And thank you for having me on for the
conversation today. I think, as a lot of people are
starting to learn more about you would think that having
control over the House and the Senate means that you
would well have control over the House and the Senate.
But the truth is you need sixty votes in the
Senate to be able to clear a normal spending bill,
(01:58):
and in fact, sixty votes in the Senate to clear
any normal piece of legislation. And so the thing that
a reconciliation bill does is it unlocks a magic fifty
vote threshold with the Vice President as the tiebreaker to
clear through the Senate. Now, mostly parties never have sixty
(02:18):
votes in the Senate. Even with Trump's mandate, Republicans still
don't have anywhere near sixty votes in the Senate, but
they can get fifty votes, and Advance of course can
break the tie. And so that's why reconciliation perhaps is
the only way to get major legislative wins through the
US Senate this Congress.
Speaker 1 (02:39):
I never thought about it till we have this conversation
with why did the reconciliation processes, as why did the
Senate carve out that one place where fifty votes plus
the vice president is able to move something.
Speaker 2 (02:52):
Well, this is, i like to say, is one of
those cases of unintended consequences in government. And this actually
gets back to why it's even called reconciliation at all.
That sounds like an odd term for it. It's that
fifty years ago, fifty one years ago, in nineteen seventy four,
Congress created the budget process. In fact, both budget committees
(03:13):
the entire concept of having a federal budget, and they
did it, at least in some part because they were
already worried about entitlement spending and runaway autopilot government spending
leading us to an unmanageable debt. Of course, as we know,
we solve that problem weight just kidding, and so we're
still in the throes of dealing with the problems from that.
(03:36):
But one of the things they did in the budget
process was create a way to reconcile differences between the
existing budget trajectory and the planned budget trajectory. So this
reconciliation bill was supposed to be a minor way of
making a handful of changes to reconcile between the real
(03:57):
budget path and the planned budget path. That's why it
has these so called expedited lower vote threshold consideration processes
in the Senate. But it was, as you can imagine,
not at all meant to be a vehicle of major
legislative making. But again on attended consequences.
Speaker 1 (04:16):
It's sort of mutated into the most important single bill
of the year. Absolutely talk about a great example of
evolution occurring in a way you could not have predicted
at the time. But it's more complicated to understand it
because you have kind of three things. You have appropriation bills,
you have a reconciliation bill, but then you also have
(04:38):
a continuing resolution which keeps the government running until they
pass the appropriations bills. And as I understand it, the
current Continuing resolution, what we would have called a CR
back when I was in Congress, is set to expire
on March fourteenth. I mean, your judgment, is Congress going
to be able to avoid a government shutdown?
Speaker 2 (04:58):
Well, so I think Congress probably will, or it might
shut down over the weekend, which is I think Congress's
favorite thing to do. Because keep in mind, Congress really
is a soap opera most of the time, masquerading as
a legislative body. Owing to everything we've talked about so far,
I think the important part here for all the listeners
is that a continued resolution is when you can't get
(05:22):
to an agreement about all of the funding for what
you normally think of as the government. So this is
all of the regulatory agencies, the military, transportation, things of
that nature. And again that's a bill that needs sixty votes,
so it always needs to be a bipartisan bill. This
is now going to be the expiration of the second
(05:43):
cr extending an appropriations bill from late last year, and
that's because twice Congress wasn't able to agree on a
future path for spending. My guess is with reconciliation going
on and everything else, they're likely to do yet another
sea having now the third iteration of it dragging on
further into the seal.
Speaker 1 (06:05):
We've had three pretty big government shutdowns twenty one days
in ninety five, ninety six when I was speaker, sixteen
days under Obama, and then the thirty five days shutdown
during Trump's first administration. And I have to say I'm
probably a minority in Washington. I thought the twenty one
days we shut down against Clinton in ninety five early
(06:26):
ninety six was actually vital in convincing the president that
we were really serious about cutting spending and really serious
about getting to a balanced budget. And I always felt
if we had not done that that, in fact, we
probably would have lost the House in ninety six, which
we became the first re elected Republican majority since nineteen
(06:47):
twenty eight. And I think it's because people decided we
were real that we were prepared to do what it took.
But the Washington press corps and the Congress often gets
panic ridden about this notion. As you look added, do
you think they probably will be able to patch something
together to keep things moving while they're negotiating.
Speaker 2 (07:06):
I'm a big fan of everything that you did in
the nineties on that. I agree with your read entirely that,
as you said, it showed that the Republican Congress was
serious at the time. I think one of the things
that we've come to realize is Doge is serious. Doge
is the kind of mirror image, if you will. It's
a serious effort from the administration to cut spending the
(07:28):
way that the shutdown you're talking about was a serious
signal from Congress thirty years ago that Congress is willing
to cut spending. I think part of the problem we
see here is that Congress doesn't seem to have that resolve. Again,
that there is that resolve in the admin at the
level of DOGE, but it doesn't seem to exist within
the Congress. So the truth then is, if Congress wanted
(07:52):
to try to shut down the government to force a
conversation about spending cuts, I think most people would say
that it's a bluff that could be called, which is
why I think they're probably likely the patch together either
some other short term funding bill like a CR or
rather milk toast fully year appropriations bill that at this
(08:12):
point only has about half the fiscal year left to go.
But it's precisely because there doesn't seem to be that
kind of resolve or focus on actually cutting spending.
Speaker 1 (08:22):
One of the things which makes it very complicated in
which we had to overcome when we balance the budget
in the nineteen nineties, is it a lot of members
I think plays too great a value on kind of
pork barrel spending for back home and you can end
up with bills that have all sorts of interesting but
not necessarily vital projects. Chalk just briefly from your perspective
(08:43):
about the role of pork barrel spending and the degree
to which it's a challenge in terms of trying to
get the budget under control.
Speaker 2 (08:50):
It is a tremendous problem. And actually it's something that
Totakeville called out when he came to America. So he
of course famously came two hundred years ago, wrote about
the US entrepreneurial, dynamic, and innovative spirit of America. But
he warned in his book that this will continue in America,
this dynamism and entrepreneurialism, right up until the moment that
(09:12):
the American public realizes that they can raid the public
treasury for their own benefit. And that is so tragically
precisely what happens in DC. We have trillions and trillions
of dollars of spending that represent exactly that kind of
pork barrel spending, that kind of raiding the public treasury
your tax dollars or having the Fed print inflationary dollars
(09:35):
just the send home benefits to a concentrated few, and
so breaking Congress of that habit. Frankly, convincing voters that
government spending always comes at your expense, whether it's your
tax dollars or it's what trigger's inflation. That's what's essential here.
But I know for me, it's also a faith issue.
It's convincing people that you have to have faith that
(09:57):
the private sector is where prosperity comes from, that it
does not come from government redistributing wealth or conferring benefits
on anybody. But if we can get back to that spirit,
then we can break the pork barrel issue and break
its hold over Congress.
Speaker 1 (10:30):
As you watch the current state of play, as you know,
the Send and the House are in very different places
and how they want to approach this. Can you sort
of outline for us what the two positions are and
why you think they're different.
Speaker 2 (10:42):
Absolutely, I think important to what we're talking about here
is this really two types of spending. There is what's
called discretionary spending, which is covered by the appropriations bills,
including the continued Resolutions, and again, as I said, that's
all the funding for regulatory agencies, the military, highway funding,
things of that nature. Then there's mandatory spending. Mandatory spending
(11:05):
you can touch in a reconciliation bill, where the appropriations
we were talking about are off the table for a
reconciliation bill. So you can think of appropriations as dealing
with that first bucket of spending, and reconciliations dealing with
a second bucket. Mandatory of course, deals with and titlements
and healthcare, welfare, but also myriad of other programs. I
(11:28):
think what's been interesting about this is, well, there seems
to be no consensus in either the House or Senate
on the first bucket of spending cuts, appropriations, discretioning money.
There is this real conversation about cutting mandatory spending. So,
as you alluded to, the Senate has put together a
framework that would require a paltry three billion dollars of
(11:49):
mandatory spending cuts at a minimum. Now they could cut more,
but that's the floor. The House, on the other hand,
is put together a bill that would require at a
minimum one and a half half trillion dollars of spending
cuts over the next ten years. And if they get
more spending cuts on top of the one and a
half trillion, they can then apply it to further cutting taxes.
(12:11):
So again, as you said, a tale of two congressional
chambers to very different approaches to trying to get mandatory
spending cuts this year.
Speaker 1 (12:21):
Why do you think the two bodies, both Republican, are
so dramatically different in how they're approaching this.
Speaker 2 (12:29):
So the question here comes down to, in essence, whether
you think Congress will actually approve those kind of cuts.
And again this gets back to can we restore the
resolve of ninety five and ninety six versus how quickly
do you want to get more money into the border
to deportations, interior immigration enforcement, and defense spending. So perfect
(12:52):
example is both the Senate and House frameworks would allow
for several hundred billion dollars of border and immigration and
force of money and money for the defense department. But
the Senates produced a framework where you could just do that,
You could just spend several hundred billion dollars on these
priorities and not have to cut spending as well. The House,
(13:16):
on the other hand, allows for that kind of border
and defense money. However, you would need to get the
requisite spending cuts we're talking about now. The other thing,
of course, is the House is following what President Trump
has asked for, which is this framework would also allow
for four and a half trillion dollars of tax cuts.
But again, to unlock the tax cuts and to unlock
(13:37):
the border and defense money in the House framework, you
would need to actually get the one and a half
trillion of spending cuts across the line. The Senate is
looking at a much more limited quick package just to
do a few hundred billion for border and defense money.
Dealing with spending cuts and tax cuts later in the year.
Speaker 1 (13:54):
I have to confess my real fear is that if
we don't pass the tax cut by May or June,
they're going to go into effect so late that we
will have a week twenty twenty six economically, and that
will doom the House Republicans to being in the minority,
which I think will be a total disaster for Trump.
(14:15):
I don't bright back to the Nancy Pelosi kind of warfare,
and yet we don't seem able to get that across
to senators.
Speaker 2 (14:23):
And some of the House members. Of course, in fact,
the reason why the House requires that minimum one and
a half trillion of spending cuts is to appease some
House members who are concerned with passing the full tax
cuts without offsetting with some spending cuts. But I think
to your point on that it gets to the heart
of the trade off conversation, which is that absolutely, if
the tax cuts don't get done early in the year,
(14:46):
or frankly, if they don't get done at all, we
would see thousands of dollars of tax increases on American
middle class families, on American small businesses that would of
course tank economic growth or delay it exactly the way
you're talking about. But there is one other part of
this that's important, of course, which is that we've run
unprecedented deficits. We have a debt that is now two
(15:09):
hundred and seventy three thousand dollars per household. Mortgage rates
are still at seven percent, Inflation is still stubbornly at
three percent, and so those extra senators and House members
are concerned that if we do the tax cuts without
spending cuts, it'll blow up the deficit, and they're concerned
they'll should get more inflation, even higher interest rates, and
(15:32):
then that will counteract both kind of on the ground
mechanically about the economy, but certainly in terms of political sentiments.
What good comes from the tax cuts. Really, the way
I see it, it's this trade off conversation that's going
on in Congress that's stymying the process.
Speaker 1 (15:48):
I'm puzzled because when I look at what Elon Musk
is doing and what Doose's doing, it seems to me
that they just buy to make America great again and
making America healthy again. If they adopted a principle of
making America honest again, they probably could get a trillion
(16:09):
dollars just by not paying crooks. I mean, it's astounding
how much money goes out there that isn't real. It's
not helping people, and it's literally in some cases just
sloppiness and ineptness of the cases. You know, it's genuine theft.
It's almost as though the President is breaking loose and
is doing things that are very bold, that the Congress
(16:31):
is still stuck inside the framework of the old order.
Speaker 2 (16:35):
Absolutely, I think you could put it better than that.
You know, on average, in a year, the government is
willing to admit that some four hundred billion dollars is
lost in waste the way you're talking about. To put
that in perspective, that's about twelve hundred dollars a year
per American family. So you think of your own household budget,
(16:57):
you are spending about one hundred dollars a month from
your household on this kind of the exact government waste
in corruption, but I should say on the waste in
corruption that the government is willing to report is happening.
I think you're absolutely right that a more honest capture
of that is easily a trillion or more dollars a year.
(17:18):
But I think you're right. Part of this is that
Congress has seen decades at this point of a lot
of talk on further cutting spending and dealing with waste,
fraud and abuse that in the last twenty five or
so years hasn't come to fruition, hasn't actually been codified.
So I think their gun shy to believe that these
will hold up in court, that these will continue to happen,
(17:39):
or frankly, that their fellow members of Congress will allow
the fiscal hawks to actually codify these cuts, to codify
these transparent, honest fixes you're talking about, to make sure
that we can stop this waste will spending going forward.
And I think that's why their mindset is still stuck
in that viewpoint.
Speaker 1 (17:57):
It's fascinatingly because when we passed welfare reform and we
invented Medicare advantage. These things were real. This wasn't just
some pious resolution, and they stuck. I mean, eventually the
Liberals tried to gradually walk back requiring people to work,
but on balance they had a huge impact, the largest
(18:19):
increase of children leaving poverty as their parents got jobs.
If we had had this information when I was Speaker,
and we could go to the country and say not
one penny for crooks, that's a pretty good battle cry
for explaining what you're trying to do. I look back
at it. We were the only four consecutive balanced budgets
in the last hundred years. But we did it by
(18:42):
a combination of real reforms. Which is why I'm very
intrigued with what Elon is doing. Because Elon is in
doge as creating the information base by which we could
win a huge argument with the American people basically on
a choice. I mean, if you want to continue are
you paying crooks, vote Democrat. If you would like to
(19:03):
save the money and only give it to people who
are honest, then vote Republican. Just strikes me that that
would be such a relatively easy structure for a campaign. Boy,
it's really hard to get house and center Republicans to understand.
Speaker 2 (19:17):
It, Oh absolutely. I think the best description I've heard
is it's like hurting mercurial cats. But to your point
on that, I think that in the nineties you had
something of a workable partner on the other side. It's
not that the left weren't still crooks. It's not that
they weren't funneling your tax dollars to left wing organizations.
That was still going on. The way that I view
(19:39):
it as, the Democrat Party at the time was still
a chiefly American party in terms of their values and
their views. They just liked to big government and they
didn't care as much about debt. I think the problem
we've got now is that so much of the other
side is just wrapped in this cultural transformation of the
country into this into this attempt, frankly, to create an
(20:03):
autocratic society that's devoid of any traditional American values. And
so it means that to actually get real reform to
deal with the corruption, you don't just need a majority
of Congress. You need to have a near unanimous vote
from the group of Congress that still believes in American values,
that still believes in honesty and transparency and respecting taxpayer dollars.
(20:28):
And so it's that unanimally you need from the people
who still care. That is the problem, because the entire
other side no longer is ashamed that there's corruption. They
live for that corruption. We've seen it in their protests
barricading doors to USAID, where they have actually actively defended
(20:49):
the money laundering and the corruption. And I think that
might be the most tragic thing that has changed in
American politics in these last few decades.
Speaker 1 (20:58):
Correct me if you don't agree with this. It seems
to me you've got two different patterns emerging among Democrats.
One is kind of a we want the money pattern
and they don't actually care whether twenty or thirty or
forty percent of it's totally inappropriate, as long as they
get theirs. And the other is the most radical elements.
(21:19):
It's almost a religion. They believe it so deeply and
it's so ingrained. They can't learn from defeat because they
have to reject the whole proposition of having been defeated
and say, yes, but we are of the true faith,
and the true faith will endure. I mean, does that
two part model make sense to you?
Speaker 2 (21:37):
I think you hit the nail right on the head there.
And you know, part of that problem, of course, is
that because as you said, they're now zealots. For them,
a defeat or an embarrassment is merely a minor setback
on what they view as a grand path to this
religious conversion of the country. And I think you're absolutely
correct about that, and that's part of what is so
(21:58):
sad to see. I think even when Bill Clinton was president,
he wasn't a pure socialist. He certainly supported things that
were socialistic. But to your point, now, I think they're
willing to take their money even if ninety percent of
it is inappropriate, because they truly believe in moving the
ownership of everything in the country into the hands of
(22:19):
their profered bureaucrats. They believe in effectively conveying titles of
nobility to the business people, to the Soroses of the world,
who they would like to have running everything. And that
is that fundamental shift to a party that, as I said, frankly,
doesn't share any real American values anymore.
Speaker 1 (22:39):
Which means that you know, there are thirteen congressional districts
with Democrats that Trump carried. They're twenty one more with
Democrats that Trump got within five percent. With the kind
of information we're getting from Elon Musk in the Doze Project,
it seems somebody that the pressure on those vulnerable Democrats
(23:02):
could become almost unbearable in terms of they're either going
to vote with us or whether they get voted out.
What do you think.
Speaker 2 (23:11):
I think that certainly opens up pressure that we haven't
seen before and haven't had before. I think even mind,
of course, on the other side of that, their leadership
knows that and is holding out these massive carrots to them, frankly,
holding out carrots to their donors, to their business owners,
saying we will give you more and more taxpayer funding.
And so I think that they're looking at this balance
(23:33):
of what you're talking about, that Trump has stirred up
a cultural movement that can flip their districts, and they're
looking at that against their own leadership, who is promising, frankly,
to use the deep state to send more benefits their
way into that of their donors. I think how that
shakes out, certainly twenty twenty six and twenty twenty eight
is going to perhaps direct the entire future of the country,
(23:55):
whether we can get those votes or not. I'd add
in as well, of course as a link or an issue.
The failure to get the census back in twenty twenty
to account for illegal immigrants is the other reason why
Republicans are down perhaps a dozen and a half seats
in the House of Representatives. And while we still have
five years before the next census, that is going to
(24:17):
continue to be a major issue that the Left is
going to hope to capitalize on again.
Speaker 1 (24:22):
I mean, don't we need to pass all that says
you only count legal citizens and green card holders. If
somebody's there illegally, why are you counting them? Then that's
supposed to be there exactly.
Speaker 2 (24:34):
And the Trump had been tried through rule making to
do it, and quite frankly, and I know the people
that were there trying to do this, the Deep States
stopped them. I mean, just as a horror story of this,
the career civil servants and I use the term servant
loosely who worked on that rule intentionally put in things
that the courts would strike down about it, just so
(24:56):
that when it failed in court and they didn't have
time to change it again, they then went back to
the politicos and said, we intentionally did this, We intentionally
failed at our job to tank this rule to keep
the legal aliens being counted in the census, and they
could not be disciplined or fired because of the bulwark
(25:18):
of laws that protect the federal civil service. This is
one of those stories that I think everybody needs to
hear about exactly how entrenched and how protected the deep
state is, and exactly how nefarious their activities are. USA Idea,
of course, has yet another one of those, but a
more recent one.
Speaker 1 (25:35):
I've been telling people that one of the things that
distinguishes Reagan from Trump is that Reagan was the most
conservative president within the framework of the establishment. Trump has now,
I think, partly been radicalized by twenty twenty and the
treatment he got after twenty twenty. Partly his entire team,
(25:57):
some four hundred people who were the America First part Institute,
and then the folks who are at Heritage and elsewhere.
Somehow under Biden there was a collective radicalization that said,
the system really is sick. They are really dedicated to
values which will destroy America. They are so incompetent of
what they're doing, whether it's Afghanistan or spending money, that
(26:21):
all of this has to be changed profoundly. And so
you now have a president who I think in his
first month is already the most consequential president since FDR,
and if he keeps going at this rate, he'll presently
be the most consequential president after Washington and Lincoln, because
he may well literally break up an establishment which has
(26:43):
been here now since nineteen thirty three.
Speaker 2 (26:46):
I think you're right about that. I think the other
president I compare him to is Andrew Jackson. And again,
this is one of these where I think in some
ways Andrew Jackson's underrated because he did precisely the same thing.
He broke up the establishment time he got rid of
an enormous amount of federal central planning of the economy,
getting rid of the Federal Bank, things of that nature,
(27:08):
in making sure that the vote went out to everyone,
not just people who own property. And so it's one
of those where I think if Andrew Jackson had not
broken up the DC establishment that way, it probably would
have derailed all of the things that have been great
that the US has achieved since the eighteen thirty So
I think he's a little underrated because I think people
(27:29):
have taken for granted what he did to get America
on its path to manifest destiny, to being that beacon
for the world. And I think we're looking at again
yet another entrenched establishment that can derail for perhaps centuries.
The future of the US is on the path for
and I think to your point, Trump is exactly the
person who comes fully outside of the establishment, who can
(27:52):
break them up and then re return that power to
the people, to the States, and get us back on
course for an even greater future.
Speaker 1 (28:16):
I couldn't read you more. When we were thinking through
the election of nineteen ninety four and creating a contract
with America, we used remedies the election of eighteen twenty eight,
which is a great study of Jackson, who remember, feels
that he came in first, he had about forty percent,
but the other two candidates ganged up on him, and
(28:36):
so in his mind, much like Trump's attitude towards the
twenty twenty election. You know, he had been denied which
should have been the presidency, which radicalized him, and then
they waged war for four years. Mean that campaign is
one of the most amazing campaigns in American history. And
of course, in exactly the establishment tradition, the largest single
(28:57):
institution in the country was the Bank of the States,
and it had to be rechartered. This charter was running
out and Jackson blocked it. And I mean that was
a real all out fight over the nature of America
and whether we should be dominated by a single big
bank or we should in fact have a series of
(29:18):
state banks. And you can argue later theoretically that there
are a lot of downsides to the state bank model,
but in terms of a profound shift of power and
a willingness to take on the sort of country club
Yale Harvard crowd, to use our modern version, Jackson is
absolutely an archetype for what Trump has been doing, except
(29:40):
that I think Trump's more methodical, actually bolder, and more
determined to break up the system on a much broader
basis than Jackson would ever dreamed of.
Speaker 2 (29:51):
Well, I agree, but I think the bulwark that Jackson
was looking at was still in its crip. And so Jackson,
I think, did that great gift by breaking up this establishment,
by breaking up the banks of what you're talking about,
prior to becoming fatal to the US, we have now
tragically seen fifty almost sixty years of the expansion of
the regulatory state, the welfare state. Things that you were
(30:13):
able obviously to have an enormous impact in blunting the
growth of in the nineties, but they still are there.
They've still grown. And of course, from now, at the
point where the federal government consumes a quarter of every
dollar earned in America, where the Code of Regulations is
quite literally hundreds of thousands of pages long, the cost
(30:34):
of regulations might be as high as fifty thousand dollars
per American household, if not higher in fact. So I
think to your point on that, Yes, Trump and his
team I think are bolder, They're more methodical, but the
threat is also larger. Jackson unfortunately was dealing with it
in its infancy. It's now a very strong adult right now.
(30:55):
But it is that two centuries later, a return of
this he real city, deep state that seeks to control
everything again, completely opposite the founding values of the family
fathers of the American Revolution. Again, I think if we
fail here, hundreds of years from now, people will remember
this as the moment we lost to that fight. If
(31:16):
we win here tragically, they'll probably take it for granted,
but will know that we have saved the Republic and
put it back on course.
Speaker 1 (31:24):
The greatness in order to win here. They have to
so thoroughly educate the American people about how sick the
system is that I suspect for two generations there'll be
the sense of awe that one that had got that bad,
and two that a handful of people had the guts
to fix it. I think in that sense, you and
(31:45):
I are privileged to be living in a period that's
really truly remarkable.
Speaker 2 (31:51):
Oh absolutely agree.
Speaker 1 (31:53):
You know.
Speaker 2 (31:53):
The other thing I think is going to be interesting
in that, of course, is that the last time this
happened in other periods in US history, we went to
an education system there was more government run that was
more about public schools. Obviously, some of these reforms, even
Teddy Roosevelt made, were right before the beginning of universal
public schooling. Now I think we're looking at the start
(32:13):
of a revolution back towards homeschooling, towards micro schooling i'd
like to call cul de sac schooling. And I think
that's going to help as well, because to your point
of the importance of making sure that everybody sees the darkness,
the manipulation, that they understand what the fight is that
homeschooling revolution is going to ensure. I think that generations
(32:34):
of Americans that come will really understand all of these things,
the level of depravity, frankly, of the deep state, and
that will continue that legacy and those values I think
for generations that come and make it easier, frankly, to
not relapse and let the deep state come back again.
Speaker 1 (32:52):
Let me put it on the spot and ask you
what advice would you give to Speaker Mike Johnson.
Speaker 2 (33:01):
The advice I'd give the him is to continue to
be bold on this. I think he and his team
have obviously tried the chart out. Of course here they
can do as Trump said, his one big, beautiful package.
But the advice I'd given, frankly, is be bolder about it,
and be bolder the way you're talking about, really go
to the American public and explain what's going on. We've
talked here a little bit about some of the numbers
(33:22):
and the brass tacks about mechanically what reconciliation is. But
most of the conversation you and I have had a
bit about these high minded philosophical things where we are
in time, what that will mean, how that will echo
into eternity. I think Johnson needs to do the same thing.
Take the case to the American public. Make it in
terms that are not about the numbers and sense, but
(33:44):
are about the values that underlie the numbers in a budget.
Speaker 1 (33:49):
I think that's tremendous advice. I really drew whatever little
I know about politics from three major sources. One was Lincoln,
who said that with public sentiment, nothing can be defeated,
or nothing can fail. Without public sentiment, nothing can succeed. Reagan,
who said, at the end of his farewell address, people
(34:09):
said I won great legislative victories, but it was you,
the American people, who won them. And you may remember
that in passing the Reagan tax cut in the House,
he gave an oval office address explaining what was involved.
Tip O'Neil thought he was ahead by twenty six votes,
and within four days he was behind by forty six.
So Reagan had had a seventy two vote swing in
(34:30):
the House based on one speech. And the third example
is Margaret Thatcher, who said, first you win the argument,
then you win the vote. And I think the importance
of what we're going through, the importance of reconciliation. I've
been telling people, if you're going to have a revolutionary president,
you have to have a revolutionary Congress, and in both
the House and Senate. Right now, Republicans are too timid
(34:52):
and they need to realize that they're at a historic
inflection point, at a crossroads of enormous opportunity, and just
go for absolutely.
Speaker 2 (35:02):
My version of that story is that what you need
are visionary leaders, and I think that you always certainly
need a body as large as Congress. You'll always get
people who might vote the right way, will be timid
doing it. Those seventy six votes that shifted over, I'm
sure did it with some doubts, but they had a
revolutionary and visionary leader in the form of Reagan. And
I think again here Trump is that as well Johnson
(35:24):
can be. And I think that's the important thing that
matters to your point. The Thatcher did, that Lincoln did,
that Reagan did, was they cast a vision for the
American public and for Congress of what the future could
look like. They weren't just there to warm the seat.
They weren't just there to shepherd things through Congress. They
were there to paint a bold image of what the
(35:46):
country meant, of what it can mean, and what it
can achieve in the future. If we have the faith
today to take those hard votes and to make those
hard decisions.
Speaker 1 (35:57):
I couldn't agree with you more, you know, Richard, I
really want to think thank you for joining me. You
know so much about this and our listeners can follow
your work at the Heritage Foundation by visiting Heritage dot org.
And this has really been I think, a very very
helpful conversation.
Speaker 2 (36:13):
Well, thank you so much for having me on. It's
been a pleasure and I always love to have these
opportunities to really get into what's going on and how
to think about it.
Speaker 1 (36:24):
Thank you to my guest, Richard Stern. You can learn
more about the Heritage Foundation on our show page at
newtsworld dot com. News World is produced by Gingrish three
sixty and iHeartMedia. Our executive producer is Guarnsey Sloan. Our
researcher is Rachel Peterson. The artwork for the show was
created by Steve Penley. Special thanks to the team at
(36:45):
gingrigh three sixty. If you've been enjoying Newtsworld, I hope
you'll go to Apple Podcast and both rate us with
five stars and give us a review so others can
learn what it's all about. Right now, listeners, the news
World Concenter for my three free weekly column at gingrichwie
sixty dot com slash newsletter. I'm new Gingrich. This is newtsworld.
On this episode of the News World. President Trump was
elected with a mandate to secure the border and enforce
immigration law, revitalize our national defense, on leish America's energy resources,
and cut wasteful and fraudulent government spending that has driven inflation.
To deliver on this agenda, Congress will need to fund
(00:26):
these priorities. Here to talk about the federal budget, spending priorities,
and the budget reconciliation process, I'm really pleased to welcome
my guests, Richard Stern, Director of the Grover M. Hermann
Center for the Federal Budget at the Heritage Foundation. Prior
to joining Heritage, Stern was a Congressional staffer for over
(00:48):
seven years. During that time, he served as a policy
staffer for the Republican Study Committee, where he was the
staff lead for their Budget and Spending Task Force and
spearheaded their work to create their Fiscal Year twenty twenty
and Fiscal Year twenty twenty two federal budgets. Richard, welcome,
(01:16):
and thank you for joining me the News World.
Speaker 2 (01:18):
Thank you for having me on today.
Speaker 1 (01:20):
I think it will be really helpful because, as you know,
this is very complicated, and so we want everybody to
have a sort of baseline knowledge. So let's just start
with it very simple. Can you explain the difference between
a reconciliation bill and a regular spending bill?
Speaker 2 (01:38):
Absolutely? And thank you for having me on for the
conversation today. I think, as a lot of people are
starting to learn more about you would think that having
control over the House and the Senate means that you
would well have control over the House and the Senate.
But the truth is you need sixty votes in the
Senate to be able to clear a normal spending bill,
(01:58):
and in fact, sixty votes in the Senate to clear
any normal piece of legislation. And so the thing that
a reconciliation bill does is it unlocks a magic fifty
vote threshold with the Vice President as the tiebreaker to
clear through the Senate. Now, mostly parties never have sixty
(02:18):
votes in the Senate. Even with Trump's mandate, Republicans still
don't have anywhere near sixty votes in the Senate, but
they can get fifty votes, and Advance of course can
break the tie. And so that's why reconciliation perhaps is
the only way to get major legislative wins through the
US Senate this Congress.
Speaker 1 (02:39):
I never thought about it till we have this conversation
with why did the reconciliation processes, as why did the
Senate carve out that one place where fifty votes plus
the vice president is able to move something.
Speaker 2 (02:52):
Well, this is, i like to say, is one of
those cases of unintended consequences in government. And this actually
gets back to why it's even called reconciliation at all.
That sounds like an odd term for it. It's that
fifty years ago, fifty one years ago, in nineteen seventy four,
Congress created the budget process. In fact, both budget committees
(03:13):
the entire concept of having a federal budget, and they
did it, at least in some part because they were
already worried about entitlement spending and runaway autopilot government spending
leading us to an unmanageable debt. Of course, as we know,
we solve that problem weight just kidding, and so we're
still in the throes of dealing with the problems from that.
(03:36):
But one of the things they did in the budget
process was create a way to reconcile differences between the
existing budget trajectory and the planned budget trajectory. So this
reconciliation bill was supposed to be a minor way of
making a handful of changes to reconcile between the real
(03:57):
budget path and the planned budget path. That's why it
has these so called expedited lower vote threshold consideration processes
in the Senate. But it was, as you can imagine,
not at all meant to be a vehicle of major
legislative making. But again on attended consequences.
Speaker 1 (04:16):
It's sort of mutated into the most important single bill
of the year. Absolutely talk about a great example of
evolution occurring in a way you could not have predicted
at the time. But it's more complicated to understand it
because you have kind of three things. You have appropriation bills,
you have a reconciliation bill, but then you also have
(04:38):
a continuing resolution which keeps the government running until they
pass the appropriations bills. And as I understand it, the
current Continuing resolution, what we would have called a CR
back when I was in Congress, is set to expire
on March fourteenth. I mean, your judgment, is Congress going
to be able to avoid a government shutdown?
Speaker 2 (04:58):
Well, so I think Congress probably will, or it might
shut down over the weekend, which is I think Congress's
favorite thing to do. Because keep in mind, Congress really
is a soap opera most of the time, masquerading as
a legislative body. Owing to everything we've talked about so far,
I think the important part here for all the listeners
is that a continued resolution is when you can't get
(05:22):
to an agreement about all of the funding for what
you normally think of as the government. So this is
all of the regulatory agencies, the military, transportation, things of
that nature. And again that's a bill that needs sixty votes,
so it always needs to be a bipartisan bill. This
is now going to be the expiration of the second
(05:43):
cr extending an appropriations bill from late last year, and
that's because twice Congress wasn't able to agree on a
future path for spending. My guess is with reconciliation going
on and everything else, they're likely to do yet another
sea having now the third iteration of it dragging on
further into the seal.
Speaker 1 (06:05):
We've had three pretty big government shutdowns twenty one days
in ninety five, ninety six when I was speaker, sixteen
days under Obama, and then the thirty five days shutdown
during Trump's first administration. And I have to say I'm
probably a minority in Washington. I thought the twenty one
days we shut down against Clinton in ninety five early
(06:26):
ninety six was actually vital in convincing the president that
we were really serious about cutting spending and really serious
about getting to a balanced budget. And I always felt
if we had not done that that, in fact, we
probably would have lost the House in ninety six, which
we became the first re elected Republican majority since nineteen
(06:47):
twenty eight. And I think it's because people decided we
were real that we were prepared to do what it took.
But the Washington press corps and the Congress often gets
panic ridden about this notion. As you look added, do
you think they probably will be able to patch something
together to keep things moving while they're negotiating.
Speaker 2 (07:06):
I'm a big fan of everything that you did in
the nineties on that. I agree with your read entirely that,
as you said, it showed that the Republican Congress was
serious at the time. I think one of the things
that we've come to realize is Doge is serious. Doge
is the kind of mirror image, if you will. It's
a serious effort from the administration to cut spending the
(07:28):
way that the shutdown you're talking about was a serious
signal from Congress thirty years ago that Congress is willing
to cut spending. I think part of the problem we
see here is that Congress doesn't seem to have that resolve. Again,
that there is that resolve in the admin at the
level of DOGE, but it doesn't seem to exist within
the Congress. So the truth then is, if Congress wanted
(07:52):
to try to shut down the government to force a
conversation about spending cuts, I think most people would say
that it's a bluff that could be called, which is
why I think they're probably likely the patch together either
some other short term funding bill like a CR or
rather milk toast fully year appropriations bill that at this
(08:12):
point only has about half the fiscal year left to go.
But it's precisely because there doesn't seem to be that
kind of resolve or focus on actually cutting spending.
Speaker 1 (08:22):
One of the things which makes it very complicated in
which we had to overcome when we balance the budget
in the nineteen nineties, is it a lot of members
I think plays too great a value on kind of
pork barrel spending for back home and you can end
up with bills that have all sorts of interesting but
not necessarily vital projects. Chalk just briefly from your perspective
(08:43):
about the role of pork barrel spending and the degree
to which it's a challenge in terms of trying to
get the budget under control.
Speaker 2 (08:50):
It is a tremendous problem. And actually it's something that
Totakeville called out when he came to America. So he
of course famously came two hundred years ago, wrote about
the US entrepreneurial, dynamic, and innovative spirit of America. But
he warned in his book that this will continue in America,
this dynamism and entrepreneurialism, right up until the moment that
(09:12):
the American public realizes that they can raid the public
treasury for their own benefit. And that is so tragically
precisely what happens in DC. We have trillions and trillions
of dollars of spending that represent exactly that kind of
pork barrel spending, that kind of raiding the public treasury
your tax dollars or having the Fed print inflationary dollars
(09:35):
just the send home benefits to a concentrated few, and
so breaking Congress of that habit. Frankly, convincing voters that
government spending always comes at your expense, whether it's your
tax dollars or it's what trigger's inflation. That's what's essential here.
But I know for me, it's also a faith issue.
It's convincing people that you have to have faith that
(09:57):
the private sector is where prosperity comes from, that it
does not come from government redistributing wealth or conferring benefits
on anybody. But if we can get back to that spirit,
then we can break the pork barrel issue and break
its hold over Congress.
Speaker 1 (10:30):
As you watch the current state of play, as you know,
the Send and the House are in very different places
and how they want to approach this. Can you sort
of outline for us what the two positions are and
why you think they're different.
Speaker 2 (10:42):
Absolutely, I think important to what we're talking about here
is this really two types of spending. There is what's
called discretionary spending, which is covered by the appropriations bills,
including the continued Resolutions, and again, as I said, that's
all the funding for regulatory agencies, the military, highway funding,
things of that nature. Then there's mandatory spending. Mandatory spending
(11:05):
you can touch in a reconciliation bill, where the appropriations
we were talking about are off the table for a
reconciliation bill. So you can think of appropriations as dealing
with that first bucket of spending, and reconciliations dealing with
a second bucket. Mandatory of course, deals with and titlements
and healthcare, welfare, but also myriad of other programs. I
(11:28):
think what's been interesting about this is, well, there seems
to be no consensus in either the House or Senate
on the first bucket of spending cuts, appropriations, discretioning money.
There is this real conversation about cutting mandatory spending. So,
as you alluded to, the Senate has put together a
framework that would require a paltry three billion dollars of
(11:49):
mandatory spending cuts at a minimum. Now they could cut more,
but that's the floor. The House, on the other hand,
is put together a bill that would require at a
minimum one and a half half trillion dollars of spending
cuts over the next ten years. And if they get
more spending cuts on top of the one and a
half trillion, they can then apply it to further cutting taxes.
(12:11):
So again, as you said, a tale of two congressional
chambers to very different approaches to trying to get mandatory
spending cuts this year.
Speaker 1 (12:21):
Why do you think the two bodies, both Republican, are
so dramatically different in how they're approaching this.
Speaker 2 (12:29):
So the question here comes down to, in essence, whether
you think Congress will actually approve those kind of cuts.
And again this gets back to can we restore the
resolve of ninety five and ninety six versus how quickly
do you want to get more money into the border
to deportations, interior immigration enforcement, and defense spending. So perfect
(12:52):
example is both the Senate and House frameworks would allow
for several hundred billion dollars of border and immigration and
force of money and money for the defense department. But
the Senates produced a framework where you could just do that,
You could just spend several hundred billion dollars on these
priorities and not have to cut spending as well. The House,
(13:16):
on the other hand, allows for that kind of border
and defense money. However, you would need to get the
requisite spending cuts we're talking about now. The other thing,
of course, is the House is following what President Trump
has asked for, which is this framework would also allow
for four and a half trillion dollars of tax cuts.
But again, to unlock the tax cuts and to unlock
(13:37):
the border and defense money in the House framework, you
would need to actually get the one and a half
trillion of spending cuts across the line. The Senate is
looking at a much more limited quick package just to
do a few hundred billion for border and defense money.
Dealing with spending cuts and tax cuts later in the year.
Speaker 1 (13:54):
I have to confess my real fear is that if
we don't pass the tax cut by May or June,
they're going to go into effect so late that we
will have a week twenty twenty six economically, and that
will doom the House Republicans to being in the minority,
which I think will be a total disaster for Trump.
(14:15):
I don't bright back to the Nancy Pelosi kind of warfare,
and yet we don't seem able to get that across
to senators.
Speaker 2 (14:23):
And some of the House members. Of course, in fact,
the reason why the House requires that minimum one and
a half trillion of spending cuts is to appease some
House members who are concerned with passing the full tax
cuts without offsetting with some spending cuts. But I think
to your point on that it gets to the heart
of the trade off conversation, which is that absolutely, if
the tax cuts don't get done early in the year,
(14:46):
or frankly, if they don't get done at all, we
would see thousands of dollars of tax increases on American
middle class families, on American small businesses that would of
course tank economic growth or delay it exactly the way
you're talking about. But there is one other part of
this that's important, of course, which is that we've run
unprecedented deficits. We have a debt that is now two
(15:09):
hundred and seventy three thousand dollars per household. Mortgage rates
are still at seven percent, Inflation is still stubbornly at
three percent, and so those extra senators and House members
are concerned that if we do the tax cuts without
spending cuts, it'll blow up the deficit, and they're concerned
they'll should get more inflation, even higher interest rates, and
(15:32):
then that will counteract both kind of on the ground
mechanically about the economy, but certainly in terms of political sentiments.
What good comes from the tax cuts. Really, the way
I see it, it's this trade off conversation that's going
on in Congress that's stymying the process.
Speaker 1 (15:48):
I'm puzzled because when I look at what Elon Musk
is doing and what Doose's doing, it seems to me
that they just buy to make America great again and
making America healthy again. If they adopted a principle of
making America honest again, they probably could get a trillion
(16:09):
dollars just by not paying crooks. I mean, it's astounding
how much money goes out there that isn't real. It's
not helping people, and it's literally in some cases just
sloppiness and ineptness of the cases. You know, it's genuine theft.
It's almost as though the President is breaking loose and
is doing things that are very bold, that the Congress
(16:31):
is still stuck inside the framework of the old order.
Speaker 2 (16:35):
Absolutely, I think you could put it better than that.
You know, on average, in a year, the government is
willing to admit that some four hundred billion dollars is
lost in waste the way you're talking about. To put
that in perspective, that's about twelve hundred dollars a year
per American family. So you think of your own household budget,
(16:57):
you are spending about one hundred dollars a month from
your household on this kind of the exact government waste
in corruption, but I should say on the waste in
corruption that the government is willing to report is happening.
I think you're absolutely right that a more honest capture
of that is easily a trillion or more dollars a year.
(17:18):
But I think you're right. Part of this is that
Congress has seen decades at this point of a lot
of talk on further cutting spending and dealing with waste,
fraud and abuse that in the last twenty five or
so years hasn't come to fruition, hasn't actually been codified.
So I think their gun shy to believe that these
will hold up in court, that these will continue to happen,
(17:39):
or frankly, that their fellow members of Congress will allow
the fiscal hawks to actually codify these cuts, to codify
these transparent, honest fixes you're talking about, to make sure
that we can stop this waste will spending going forward.
And I think that's why their mindset is still stuck
in that viewpoint.
Speaker 1 (17:57):
It's fascinatingly because when we passed welfare reform and we
invented Medicare advantage. These things were real. This wasn't just
some pious resolution, and they stuck. I mean, eventually the
Liberals tried to gradually walk back requiring people to work,
but on balance they had a huge impact, the largest
(18:19):
increase of children leaving poverty as their parents got jobs.
If we had had this information when I was Speaker,
and we could go to the country and say not
one penny for crooks, that's a pretty good battle cry
for explaining what you're trying to do. I look back
at it. We were the only four consecutive balanced budgets
in the last hundred years. But we did it by
(18:42):
a combination of real reforms. Which is why I'm very
intrigued with what Elon is doing. Because Elon is in
doge as creating the information base by which we could
win a huge argument with the American people basically on
a choice. I mean, if you want to continue are
you paying crooks, vote Democrat. If you would like to
(19:03):
save the money and only give it to people who
are honest, then vote Republican. Just strikes me that that
would be such a relatively easy structure for a campaign. Boy,
it's really hard to get house and center Republicans to understand.
Speaker 2 (19:17):
It, Oh absolutely. I think the best description I've heard
is it's like hurting mercurial cats. But to your point
on that, I think that in the nineties you had
something of a workable partner on the other side. It's
not that the left weren't still crooks. It's not that
they weren't funneling your tax dollars to left wing organizations.
That was still going on. The way that I view
(19:39):
it as, the Democrat Party at the time was still
a chiefly American party in terms of their values and
their views. They just liked to big government and they
didn't care as much about debt. I think the problem
we've got now is that so much of the other
side is just wrapped in this cultural transformation of the
country into this into this attempt, frankly, to create an
(20:03):
autocratic society that's devoid of any traditional American values. And
so it means that to actually get real reform to
deal with the corruption, you don't just need a majority
of Congress. You need to have a near unanimous vote
from the group of Congress that still believes in American values,
that still believes in honesty and transparency and respecting taxpayer dollars.
(20:28):
And so it's that unanimally you need from the people
who still care. That is the problem, because the entire
other side no longer is ashamed that there's corruption. They
live for that corruption. We've seen it in their protests
barricading doors to USAID, where they have actually actively defended
(20:49):
the money laundering and the corruption. And I think that
might be the most tragic thing that has changed in
American politics in these last few decades.
Speaker 1 (20:58):
Correct me if you don't agree with this. It seems
to me you've got two different patterns emerging among Democrats.
One is kind of a we want the money pattern
and they don't actually care whether twenty or thirty or
forty percent of it's totally inappropriate, as long as they
get theirs. And the other is the most radical elements.
(21:19):
It's almost a religion. They believe it so deeply and
it's so ingrained. They can't learn from defeat because they
have to reject the whole proposition of having been defeated
and say, yes, but we are of the true faith,
and the true faith will endure. I mean, does that
two part model make sense to you?
Speaker 2 (21:37):
I think you hit the nail right on the head there.
And you know, part of that problem, of course, is
that because as you said, they're now zealots. For them,
a defeat or an embarrassment is merely a minor setback
on what they view as a grand path to this
religious conversion of the country. And I think you're absolutely
correct about that, and that's part of what is so
(21:58):
sad to see. I think even when Bill Clinton was president,
he wasn't a pure socialist. He certainly supported things that
were socialistic. But to your point, now, I think they're
willing to take their money even if ninety percent of
it is inappropriate, because they truly believe in moving the
ownership of everything in the country into the hands of
(22:19):
their profered bureaucrats. They believe in effectively conveying titles of
nobility to the business people, to the Soroses of the world,
who they would like to have running everything. And that
is that fundamental shift to a party that, as I said, frankly,
doesn't share any real American values anymore.
Speaker 1 (22:39):
Which means that you know, there are thirteen congressional districts
with Democrats that Trump carried. They're twenty one more with
Democrats that Trump got within five percent. With the kind
of information we're getting from Elon Musk in the Doze Project,
it seems somebody that the pressure on those vulnerable Democrats
(23:02):
could become almost unbearable in terms of they're either going
to vote with us or whether they get voted out.
What do you think.
Speaker 2 (23:11):
I think that certainly opens up pressure that we haven't
seen before and haven't had before. I think even mind,
of course, on the other side of that, their leadership
knows that and is holding out these massive carrots to them, frankly,
holding out carrots to their donors, to their business owners,
saying we will give you more and more taxpayer funding.
And so I think that they're looking at this balance
(23:33):
of what you're talking about, that Trump has stirred up
a cultural movement that can flip their districts, and they're
looking at that against their own leadership, who is promising, frankly,
to use the deep state to send more benefits their
way into that of their donors. I think how that
shakes out, certainly twenty twenty six and twenty twenty eight
is going to perhaps direct the entire future of the country,
(23:55):
whether we can get those votes or not. I'd add
in as well, of course as a link or an issue.
The failure to get the census back in twenty twenty
to account for illegal immigrants is the other reason why
Republicans are down perhaps a dozen and a half seats
in the House of Representatives. And while we still have
five years before the next census, that is going to
(24:17):
continue to be a major issue that the Left is
going to hope to capitalize on again.
Speaker 1 (24:22):
I mean, don't we need to pass all that says
you only count legal citizens and green card holders. If
somebody's there illegally, why are you counting them? Then that's
supposed to be there exactly.
Speaker 2 (24:34):
And the Trump had been tried through rule making to
do it, and quite frankly, and I know the people
that were there trying to do this, the Deep States
stopped them. I mean, just as a horror story of this,
the career civil servants and I use the term servant
loosely who worked on that rule intentionally put in things
that the courts would strike down about it, just so
(24:56):
that when it failed in court and they didn't have
time to change it again, they then went back to
the politicos and said, we intentionally did this, We intentionally
failed at our job to tank this rule to keep
the legal aliens being counted in the census, and they
could not be disciplined or fired because of the bulwark
(25:18):
of laws that protect the federal civil service. This is
one of those stories that I think everybody needs to
hear about exactly how entrenched and how protected the deep
state is, and exactly how nefarious their activities are. USA Idea,
of course, has yet another one of those, but a
more recent one.
Speaker 1 (25:35):
I've been telling people that one of the things that
distinguishes Reagan from Trump is that Reagan was the most
conservative president within the framework of the establishment. Trump has now,
I think, partly been radicalized by twenty twenty and the
treatment he got after twenty twenty. Partly his entire team,
(25:57):
some four hundred people who were the America First part Institute,
and then the folks who are at Heritage and elsewhere.
Somehow under Biden there was a collective radicalization that said,
the system really is sick. They are really dedicated to
values which will destroy America. They are so incompetent of
what they're doing, whether it's Afghanistan or spending money, that
(26:21):
all of this has to be changed profoundly. And so
you now have a president who I think in his
first month is already the most consequential president since FDR,
and if he keeps going at this rate, he'll presently
be the most consequential president after Washington and Lincoln, because
he may well literally break up an establishment which has
(26:43):
been here now since nineteen thirty three.
Speaker 2 (26:46):
I think you're right about that. I think the other
president I compare him to is Andrew Jackson. And again,
this is one of these where I think in some
ways Andrew Jackson's underrated because he did precisely the same thing.
He broke up the establishment time he got rid of
an enormous amount of federal central planning of the economy,
getting rid of the Federal Bank, things of that nature,
(27:08):
in making sure that the vote went out to everyone,
not just people who own property. And so it's one
of those where I think if Andrew Jackson had not
broken up the DC establishment that way, it probably would
have derailed all of the things that have been great
that the US has achieved since the eighteen thirty So
I think he's a little underrated because I think people
(27:29):
have taken for granted what he did to get America
on its path to manifest destiny, to being that beacon
for the world. And I think we're looking at again
yet another entrenched establishment that can derail for perhaps centuries.
The future of the US is on the path for
and I think to your point, Trump is exactly the
person who comes fully outside of the establishment, who can
(27:52):
break them up and then re return that power to
the people, to the States, and get us back on
course for an even greater future.
Speaker 1 (28:16):
I couldn't read you more. When we were thinking through
the election of nineteen ninety four and creating a contract
with America, we used remedies the election of eighteen twenty eight,
which is a great study of Jackson, who remember, feels
that he came in first, he had about forty percent,
but the other two candidates ganged up on him, and
(28:36):
so in his mind, much like Trump's attitude towards the
twenty twenty election. You know, he had been denied which
should have been the presidency, which radicalized him, and then
they waged war for four years. Mean that campaign is
one of the most amazing campaigns in American history. And
of course, in exactly the establishment tradition, the largest single
(28:57):
institution in the country was the Bank of the States,
and it had to be rechartered. This charter was running
out and Jackson blocked it. And I mean that was
a real all out fight over the nature of America
and whether we should be dominated by a single big
bank or we should in fact have a series of
(29:18):
state banks. And you can argue later theoretically that there
are a lot of downsides to the state bank model,
but in terms of a profound shift of power and
a willingness to take on the sort of country club
Yale Harvard crowd, to use our modern version, Jackson is
absolutely an archetype for what Trump has been doing, except
(29:40):
that I think Trump's more methodical, actually bolder, and more
determined to break up the system on a much broader
basis than Jackson would ever dreamed of.
Speaker 2 (29:51):
Well, I agree, but I think the bulwark that Jackson
was looking at was still in its crip. And so Jackson,
I think, did that great gift by breaking up this establishment,
by breaking up the banks of what you're talking about,
prior to becoming fatal to the US, we have now
tragically seen fifty almost sixty years of the expansion of
the regulatory state, the welfare state. Things that you were
(30:13):
able obviously to have an enormous impact in blunting the
growth of in the nineties, but they still are there.
They've still grown. And of course, from now, at the
point where the federal government consumes a quarter of every
dollar earned in America, where the Code of Regulations is
quite literally hundreds of thousands of pages long, the cost
(30:34):
of regulations might be as high as fifty thousand dollars
per American household, if not higher in fact. So I
think to your point on that, Yes, Trump and his
team I think are bolder, They're more methodical, but the
threat is also larger. Jackson unfortunately was dealing with it
in its infancy. It's now a very strong adult right now.
(30:55):
But it is that two centuries later, a return of
this he real city, deep state that seeks to control
everything again, completely opposite the founding values of the family
fathers of the American Revolution. Again, I think if we
fail here, hundreds of years from now, people will remember
this as the moment we lost to that fight. If
(31:16):
we win here tragically, they'll probably take it for granted,
but will know that we have saved the Republic and
put it back on course.
Speaker 1 (31:24):
The greatness in order to win here. They have to
so thoroughly educate the American people about how sick the
system is that I suspect for two generations there'll be
the sense of awe that one that had got that bad,
and two that a handful of people had the guts
to fix it. I think in that sense, you and
(31:45):
I are privileged to be living in a period that's
really truly remarkable.
Speaker 2 (31:51):
Oh absolutely agree.
Speaker 1 (31:53):
You know.
Speaker 2 (31:53):
The other thing I think is going to be interesting
in that, of course, is that the last time this
happened in other periods in US history, we went to
an education system there was more government run that was
more about public schools. Obviously, some of these reforms, even
Teddy Roosevelt made, were right before the beginning of universal
public schooling. Now I think we're looking at the start
(32:13):
of a revolution back towards homeschooling, towards micro schooling i'd
like to call cul de sac schooling. And I think
that's going to help as well, because to your point
of the importance of making sure that everybody sees the darkness,
the manipulation, that they understand what the fight is that
homeschooling revolution is going to ensure. I think that generations
(32:34):
of Americans that come will really understand all of these things,
the level of depravity, frankly, of the deep state, and
that will continue that legacy and those values I think
for generations that come and make it easier, frankly, to
not relapse and let the deep state come back again.
Speaker 1 (32:52):
Let me put it on the spot and ask you
what advice would you give to Speaker Mike Johnson.
Speaker 2 (33:01):
The advice I'd give the him is to continue to
be bold on this. I think he and his team
have obviously tried the chart out. Of course here they
can do as Trump said, his one big, beautiful package.
But the advice I'd given, frankly, is be bolder about it,
and be bolder the way you're talking about, really go
to the American public and explain what's going on. We've
talked here a little bit about some of the numbers
(33:22):
and the brass tacks about mechanically what reconciliation is. But
most of the conversation you and I have had a
bit about these high minded philosophical things where we are
in time, what that will mean, how that will echo
into eternity. I think Johnson needs to do the same thing.
Take the case to the American public. Make it in
terms that are not about the numbers and sense, but
(33:44):
are about the values that underlie the numbers in a budget.
Speaker 1 (33:49):
I think that's tremendous advice. I really drew whatever little
I know about politics from three major sources. One was Lincoln,
who said that with public sentiment, nothing can be defeated,
or nothing can fail. Without public sentiment, nothing can succeed. Reagan,
who said, at the end of his farewell address, people
(34:09):
said I won great legislative victories, but it was you,
the American people, who won them. And you may remember
that in passing the Reagan tax cut in the House,
he gave an oval office address explaining what was involved.
Tip O'Neil thought he was ahead by twenty six votes,
and within four days he was behind by forty six.
So Reagan had had a seventy two vote swing in
(34:30):
the House based on one speech. And the third example
is Margaret Thatcher, who said, first you win the argument,
then you win the vote. And I think the importance
of what we're going through, the importance of reconciliation. I've
been telling people, if you're going to have a revolutionary president,
you have to have a revolutionary Congress, and in both
the House and Senate. Right now, Republicans are too timid
(34:52):
and they need to realize that they're at a historic
inflection point, at a crossroads of enormous opportunity, and just
go for absolutely.
Speaker 2 (35:02):
My version of that story is that what you need
are visionary leaders, and I think that you always certainly
need a body as large as Congress. You'll always get
people who might vote the right way, will be timid
doing it. Those seventy six votes that shifted over, I'm
sure did it with some doubts, but they had a
revolutionary and visionary leader in the form of Reagan. And
I think again here Trump is that as well Johnson
(35:24):
can be. And I think that's the important thing that
matters to your point. The Thatcher did, that Lincoln did,
that Reagan did, was they cast a vision for the
American public and for Congress of what the future could
look like. They weren't just there to warm the seat.
They weren't just there to shepherd things through Congress. They
were there to paint a bold image of what the
(35:46):
country meant, of what it can mean, and what it
can achieve in the future. If we have the faith
today to take those hard votes and to make those
hard decisions.
Speaker 1 (35:57):
I couldn't agree with you more, you know, Richard, I
really want to think thank you for joining me. You
know so much about this and our listeners can follow
your work at the Heritage Foundation by visiting Heritage dot org.
And this has really been I think, a very very
helpful conversation.
Speaker 2 (36:13):
Well, thank you so much for having me on. It's
been a pleasure and I always love to have these
opportunities to really get into what's going on and how
to think about it.
Speaker 1 (36:24):
Thank you to my guest, Richard Stern. You can learn
more about the Heritage Foundation on our show page at
newtsworld dot com. News World is produced by Gingrish three
sixty and iHeartMedia. Our executive producer is Guarnsey Sloan. Our
researcher is Rachel Peterson. The artwork for the show was
created by Steve Penley. Special thanks to the team at
(36:45):
gingrigh three sixty. If you've been enjoying Newtsworld, I hope
you'll go to Apple Podcast and both rate us with
five stars and give us a review so others can
learn what it's all about. Right now, listeners, the news
World Concenter for my three free weekly column at gingrichwie
sixty dot com slash newsletter. I'm new Gingrich. This is newtsworld.
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