November 14, 2025 • 45 mins
On this episode of The Federalist Radio Hour, Grover Norquist, president of Americans for Tax Reform, joins Federalist Senior Elections Correspondent Matt Kittle to discuss the history of the partisan power struggle for the national purse and explain what Democrats got out of the latest and longest government shutdown.
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Episode Transcript
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Speaker 1 (00:18):
And we are back with another edition of the Federalist
Radio Hour. I'm Matt Kittle, Senior Elections correspondent at the
Federalist and your experienced Shirpa on today's quest for Knowledge.
As always, you can email the show at radio at
the Federalist dot com, follow us on x at FDR LST,
make sure to subscribe wherever you download your podcast, and
(00:40):
of course to our premium version of our website as well.
Our guest today needs no introduction, but because this is
a podcast and an audio only podcast at that, I
think in introduction is necessary. It is Grover Norquist joining
US President of Americans for Tax Reform. We have much
to talk about on the tax reform area, particularly after
(01:03):
a long and stupid government shut down that well, at
the end of the day, let's face it, when we
have a shutdown, it's the American taxpayer that ultimately gets screwed. Grover,
thank you so much for joining us on this edition
of the Federalist Radio Hour.
Speaker 2 (01:22):
So Matt, thank you delighted to be with you.
Speaker 1 (01:24):
Absolutely listen. By the way, first and foremost, let me
say happy fortieth anniversary.
Speaker 2 (01:31):
Yes, it is the fortieth anniversary of the taxpayer Protection Pledge,
and I came up with it nineteen eighty six in
order to help pass the Tax Reform Act of nineteen
eighty six, and a lot of Republicans said, you know what,
if we broaden the base, mean get rid of deductions
(01:52):
and credits, and reduce the right in a way that
doesn't raise our reduce taxes. Democrats want to reduce taxes,
Republicans weren't going to raise them, so they they took
the rates down. Top rate was twenty seven. The two
rates fifteen and twenty seven. How far we've gone from that.
Thank you George Doub Herbert Walker Bushes starting that process,
(02:18):
opening the door to the Democrats to do it. But
at the time we were passing this much lower rate.
And the pledge says I will oppose and vote against
any efforts to increase rates or to broaden the base
unless rates come down. So no net tax increase period ever,
not for any reason, ever whatever.
Speaker 1 (02:39):
Read my lips right that he signed the pledge.
Speaker 2 (02:43):
When he ran for president, and he said read my lips. Actually,
what Bush said was stronger than read my lips. The
whole section of that speech was the I know what's
going to happen that the Democrats will come to me
and they'll ask for a tax increase, and I will
say no. They'll come back and ask again for a
(03:04):
tax increase, and I will say no. And they'll come
again the third time, and I will say, read my lips,
no new taxes, which is a much stronger statement, because
he outlined exactly what the Democrats did, and then forgot
to mention that he folded on the third time they asked.
Speaker 1 (03:27):
We've seen a lot of that folding, of course, over
the last forty years, but we've also seen, thanks to
the pledge, a lot of conservatives at least. And every
once in a while you'll get a well, I guess
I should ask that have you ever gotten a Democrat?
I think you have over the years, have you not?
Speaker 2 (03:47):
Yes. The first year we put it out, nineteen eighty six,
I had two senators and five Democrats. And when push
then in nineteen ninety four, these two Democratic senators and
(04:11):
one from Alabama went from Colorado, and five Democratic congressmen.
After the nineteen ninety three election, which happened to be
the first election when ninety six percent of Republicans signed
the pledge never to raise taxes incumbents. The first time
we did it, we had twenty Senators and one hundred congressman.
(04:33):
So it was a good number, I mean, you know,
a strong support. Most issues couldn't get that many guys
to sign on. But when we went with ninety six
percent of Republicans in the House and Senate, that was
the year Republicans won the House and the Senate. And
since that date nineteen ninety four, the Republicans have won
(04:57):
the House and the Senate eighteen years, the Democrats for six,
and it was split fifty to fifty six years before
that year when the Republicans said we are not raising
taxes ever, ever, and again this was everybody, This is
(05:18):
John mcain, this is you know, conservatives, moderates. Everybody said,
you know, we're not raising taxes. Some moderates may not
have been for big tax cuts, but they were against
any tax increase. And for the sixty two years before
nineteen ninety four, nineteen thirty two till nineteen ninety four,
(05:40):
from FDR coming in to Gingrich coming in in that
sixty two years, Republicans won the Congress twice, yes twice.
That we had a one party state for sixty two years.
I'm sorry, but Eisenhower being president, anything that they wanted
that he vetoed, they just wait till we moved. And
(06:02):
the same thing with Nixon, and frankly, the same thing
with Reagan. They just said, we'll wait till you're gone,
because we own Congress always and forever, and Congress runs
the country. They passed the laws, they raised the taxes,
they approved Supreme Court justices. Presidents have scandals and start wars,
(06:22):
but that's all they get to do, and then they
can detail things. They can slow stuff down, which is
very important, but it's a limited tool. We didn't have
the ability to do anything by Republicans alone. We had
to have Democrat support. Whereas Democrats when they did the
New Deal had eighty percent House and Senate, so they
(06:46):
just bram rotted it. When they did the Great Society,
it was seventy percent House and Senates, and so that
really was a shift. And if you look at a
chart that Americans for Tax Reformed put out, you see
this sea of blue for sixty two years, and then
(07:07):
you know mostly red three times as often red Congress
as blue eighteen versus six years. That changed the country.
But it also meant the Democrats who used to say
keep the president weak because sometimes we have a scandal
that the Republicans get the presidency, but we know we
(07:27):
own Congress. So they stuffed all the power in Congress.
Now they're in a panic because they don't own Congress
all the time. Matter of fact, they own it less
often than the Republicans do. So they tried to stick
the power in Supreme Court. Well, oops, they want that
one too. Then they went in for the bureaucracy. And
although they've been doing that one for a long time.
(07:49):
Stick the power in the bureaucracy. The president can do
what he wants. But if independent bureaucracies fcc icc irs
can act on their own, they can new to the presidency.
Or if the president tries to disagree with a bureaucrat,
andy not elect the bureaucrat. This town acts as if
he'd been cheating, if he was becoming a king, because
(08:13):
he wanted to execut to run executive power. And now
the Democrats without they owned the presidents. You know, they
win the presidency fifty to fifty. We've been doing that
since Eisenhower. But the Congress is more Republican. The Supreme
Court does not have the thumb on the scale for
(08:35):
the Democrats, and the bureaucracy is being changed in that
the Supreme Court is ruled that, you know, bureaucrats can't
make decisions, only Congress and the President can, which would
please the Democrats find when they own the Congress all
the time, but they're not crazy about having decisions go
(08:57):
to Congress now. No.
Speaker 1 (08:59):
Exactly, in fact, Congress is you know, on both sides,
one could argue that, you know, and this is what
the shutdown really gets down to, is that both sides
have abdicated its first branch, main priority, and that is
first and foremost to put together a budget and hopefully
a budget that doesn't continue to sock it to the
(09:21):
American taxpayer. If I could use the turning of phrase
from Richard Milhouse Nixon on laugh In so many years
ago when he said sock it to me, that's exactly
what Democrats have done for a long time. So basically
what we've had, what we had in this country for
sixty plus years was the state of California in Congress.
(09:43):
Although I would hasten to say the Democrats of yr
would not recognize a tip O'Neill would not much recognize
a Democrat of twenty twenty five.
Speaker 2 (09:57):
Do you agree, yes on the cultural issues, but you
can know the economic issues and even to a large
extent on the foreign policy issues. That Democrats had some
great weaknesses during the Cold War, but they at least
know which side they were theoretically on. Maybe half of
them did anyway.
Speaker 1 (10:20):
Yeah, it's amazing to think how much has really changed
on that front. So that brings us to the modern
day and why your battle forty years later continues to
be such an important battle, And that is to make
sure with a country with a thirty seven plus trillion
dollar debt annual trillions of dollars in deficits, that Congress
(10:49):
get this thing under control, because that's who has the
power to do it. So with all of that said,
what do you think of the longest shutdown in American
history that finally this week ended.
Speaker 2 (11:03):
It was very interesting because there were different reasons why
different players did what they did, whereas a few years
ago they played it differently. And the Schumer, Senator Schumer
of New York, the Senate leader for the Democrats, a
(11:24):
wild liberal but not part of the new socialist wing
of the Democratic Party.
Speaker 1 (11:33):
Mom Donnie wing.
Speaker 2 (11:36):
The Madonni Win, the AOC wing, the Bernie Sanders wing,
and and he's a realist. He realizes you don't run
Bolsheviks for the Senate in you know, British states. You
can do that in Vermont, but not other places. And
so he said seven months ago to the Democrats, do
(12:02):
the continuing resolution the Republicans are suggesting, which takes it
out seven at the time, I think it was seven months,
because if you don't, we will be response. If we don't,
we will be responsible for shutting the government down. Because
the Republicans had put together budgets and the Democrats were stalling,
(12:24):
you know, participating and doing a budget for the Defense
Department and the act Department, the education departments on the
way one normally did them before nineteen ninety four, back
when the Democrats had the majorities in the House and Senate.
They always did regular order, and sometimes the Republicans in
the committee might make a good argument or have a
(12:45):
bunch of Democrats on their side, and so some Republican
thing of interest would get into the budget that they
weren't completely shut out, but it was rare and if
they if the party really cared it wasn't going to happen.
So since ninety four, the Democrats have said, you know,
we really want just put the whole budget in one
(13:06):
big pile. We're not going to do regular order, and
we will have a list of things that we insist
being that pile, and that that basically pay us for
all of our political allies. And then the budget will
be written by a small committee of the head of
the Democratic Party the head of the Republican Party in
(13:27):
the House in the Senate, not by big committees and
so on. And this will may give the Democrats half
the power, even though they don't have either house. And
that's why we went away from regular order. The Democrats
didn't want it. It didn't fit their interests. And so
(13:49):
he was saying, you know, now, we can't do this.
We can't give the Republicans control over writing the budget.
And he convinced his team the Democrats crazy ones too, Okay,
we'll kick the can down seven months. By the time,
they'd had seven months of Trump being on three of
(14:11):
the seven headlines in the Washington Post every day day
after day, Trump does this, Trump does that, Trump does this,
and uh, making all sorts of decisions and executive orders
and the Republicans in Congress doing different things. They were
just frustrated. They felt beat up, they felt ignored, they
(14:33):
felt unloved. And my sense is it was a little
bit like that second of the last scene in Animal
House where they're about to be thrown The misbehaving black
boys have all been expelled from school and they're going
to close down their fraternity, and someone comes up and says,
(14:55):
you know, this is the time to do something truly
stupid and futile. Yes, and all the guys are yeah,
So that's us, And they run outside and they go
do something stupid that didn't keep them from getting expelled,
didn't keep the fraternity from being shut down, but it
made them feel good.
Speaker 1 (15:17):
The John who played the John Belushi role, the Blueto role,
who said was it over when the Germans bombed Pearl Harbor,
It's the same kind of logic, right, I.
Speaker 2 (15:28):
Think that was Bernie and AOC. Yeah, we've got to
do this. It's important. Will it work? It's important. We
have to do this. Will it work? It's important. We
have to do this. Our base wants to see us fighting.
Now sitting in a committee and getting out voted doesn't
qualify as being seen as fighting. No, that's the best
(15:49):
you can do with inside a constitutional order. So they said, no,
we're going to close the government down. And Schumer, who
he's the role of the guy who was standing in
front of the jail trying to get the lynch mob
from doing the guy who's in the jail says, don't
do this, don't do this, it's wrong. At some point goes, oh, hell,
(16:10):
I'm their leader, and he turns around and he joins
the lynch mob and he starts acting like he was
Bernie Sanders. We're going to do this. We're going to
do that. It's going to work. If they had a plan,
it is unclear what it was. I think they were
hoping that the press would say the Republicans closed the
government down, even though the Democrats clearly had and they
(16:32):
couldn't even get the Washington Post a life for them
on that sort of thing. So that didn't work. And
their demands were massive new spending when everybody had been
talking about the deficit. Even the Democrats were you can't
cut taxes, there's a deficit, but we can spend one
point five trillion dollars more So, they crashed and burned.
(17:00):
We ate Democrats. Eventually, there were always some Democrats voting
with the Republicans, so it was never just a partisan effort.
The Republicans kept saying every day that the Republicans would
make the Democrats in the Senate vote against opening government
and then against paying the troops, and then against paying
the FAA air traffic controls. I mean, they're Democrats running
(17:23):
for Senate with real pretty wacky votes out there in
front of them. So you voted against paying veterans benefits,
against paying you know. I mean, just on and on
and on, and they got to the end and they
gave up. They lost. They're not even pretending that they
(17:47):
won something. They didn't get any any of the big
things that they wanted, if they got little things here
or there. The America, the federal workers who came back
back got paid for their time, which always happens. But
we let the Democrats think it was a concession because
(18:08):
made them feel good, but it wasn't. So we're now
pivoting and the big question is what was this about?
And the answer is it was all about the Democrats
needing four or five hundred billion dollars to subsidize the
failure of Obamacare. Obamacare, we painfully remember we were told
(18:31):
you could keep your doctor. That was a lie. Even
the Washington Post called it the biggest lie of the year.
The Washington Post printed that after the bill passed. We
didn't talk about it before the bill passed.
Speaker 1 (18:44):
That's the courage of the Washington Post right there, Exhibit A.
Speaker 2 (18:50):
They will tell the truth once once right, a Republican
scandal becomes the guy's middle name. A Democratic scandal is
mentioned once on page be thirty seven. But so now
we have a discussion where the Republicans are saying, in
(19:11):
the next tax bill, we want to expand health savings
accounts so that every American can have a health savings account,
which allows you an off ramp from Obamacare. And seventy
million people have a health savings account w It's like
an IRA or four O n K, but for health care.
You put in some money or the company may put
(19:32):
in all the money. But then you decide how to
spend it, and it gives you control on what you
buy and don't buy. And if you don't use it,
you get to save it and it accumulates for future
needs or crisis or something. They're very great project lines.
And then the Republicans have been wanting to increase health
(19:54):
savings accounts, but the Democrats put in rules to make
it difficult to expand them. Those are the things that
will be dismantling in the spring and opening up for
people to view. And the deeds will say you should
have subsidized, you should have passed the subsidies, and the
answer to that is that included people who make as
(20:16):
much as five hundred thousand dollars a year. We're getting
some of these subsidies. Many of those subsidies went straight
to the insurance companies and no person ever you made
use of them, never put in a claim at all
at all. I mean millions of people didn't, which makes
you wonder whether the insurance companies just signed up people
(20:39):
and they didn't even know maybe that they had the healthcare.
That's one of the things they're looking at now. How
could you possibly have had this huge group of millions
of people who supposedly bought healthcare for free. Thank you
to Obamacare and taxpayers.
Speaker 3 (20:56):
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Speaker 1 (21:34):
Well, that's one of the Yeah, that's one of the
biggest problems with Obamacare has been you know for the
last what fifteen years now, and that is insurance companies,
many of them have gotten rich and the taxpayer has
again to turn the phrase I turned at the beginning
of our conversation, has gotten screwed over and over again.
(21:58):
That's what you have to be watching out for. Coming up.
Our guest today is Grover Norquist, President Americans for Tax Reform,
and so I guess if there was any lesson hopefully
learned by at least some people in this great Republic
of ours, is that Obamacare isn't workable, and quite frankly,
(22:23):
Grover isn't that what Democrats wanted it to be all
the time, you know, from the beginning, And didn't Obama
even say that they wanted it to implode so that
they could go full on socialized healthcare, government funded, government
paid for health care for everyone, which of course would
(22:44):
be even a greater disaster.
Speaker 2 (22:47):
Yes, they believed when they passed Obamacare, because they had
sixty votes in the Senate briefly, that they were now
invincible and that their victory with Obama and the House,
and it meant that it was back to FDR days.
All they had to do was do healthcare, lock everyone
(23:08):
into government control of healthcare, and then they would in
the same way that they bought a great number of
votes with welfare, that they would do the same thing
with healthcare. So they were going to be in power.
And as this failed, and you're quite right, they talked
openly about the course it's going to fail, and when
it failed, they kept, oh my goodness, it's failed. Kind
(23:31):
of like the teachers union lobby the public. Our teachers
are not teaching kids how to read by fourth grade,
and they're not graduating, and their way behind the Japanese
and the Koreans and many other nations. You know what
we need to do. Give more money to the same
(23:52):
people with the same project and the same rules as before,
and that'll fix it. So the worst the public schools,
the more they need to make, the more they should
have more money because this will fix it. Of course
that's nonsense. But they would do the same thing with Obamaca.
They would announce as the British to I mean, you
listen to the politics of Britain. Would everything's go wrong
(24:14):
and they start continuing to ration care and so on,
Send more money, don't fix the problem, Just keep the
present government monopoly in place and raise everyone's.
Speaker 1 (24:26):
Pay right, Yeah, over and over again. And so if
the definition of insanity is failing over and over again
and continuing on that path, we certainly have had that
in Obamacare. You talk to your organization, talks to members
(24:49):
of Congress on a daily basis. You got through this
fight with republic Well, first of all, are you surprised
that you didn't have some case from Republicans in this
long battle? Because while Americans, I think knew who shut
down this government, there was a lot of noise and
(25:11):
a very dishonest corporate media press in many circles that
kept trying to make this a Republican thing when obviously
it was not. Were you surprised that there was backbone
and unity in all of this.
Speaker 2 (25:30):
Yeah, Every once in a while, some of my friends
on the right go, oh, the Republicans failed to do
this or refused to do this. Meaning three people in
the House and two people or two people in the
Senate didn't vote with the rest of the party. Okay,
that's not the Republicans failing to do something. When John
(25:51):
McCain stabbed us all in the back, having promised that
very day, he'd promised that he would be voting for
the reform of Obamacare back in the first Trump turn,
and he was mad about something and decided to vote
no on the most important reform of entitlements ever in history,
(26:15):
and something that he was born ideologically a liberal. He
was just a little self centered, and.
Speaker 1 (26:27):
So he votes no.
Speaker 2 (26:28):
Right, That wasn't the Republicans losing. That was John McCain
deciding to do something that was in his personal interest.
He thought, I'm not sure I want to go down
in history as having that on my tombstone. Refused to
reform government spending because he actually was more often than
(26:48):
not in favor of reducing government spending. He just literally
had peaque. But if you have a one or two
vote majority and you need fifty votes or two un
and eighteen in the House, somebody's all he's cranky about something.
And in the House side you get every once in
a while, somebody's not voting with you to go. I
(27:09):
just listened to that person explain it. I have no
idea what they're talking about. They weren't being liberals in
most cases. As a matter of fact, that the people
who killed the earliest tax reform that Trump had were
about thirty conservatives who didn't understand that with the reconciliation package,
you can't change laws. You can only change budget numbers.
(27:31):
And they said, we're not doing this until it includes
abolishing Obamacare, which would require changing laws, which you can't
do because the law is written to say you can
do a reconciliation package on budget numbers, not repeal the
right to work law, not pology, and on policy. And
we had thirty people who got elected to Congress who
(27:54):
didn't understand that, and they just shouted louder and louder.
I'm going to hold my breath until I turned blue.
And if you don't do this, I can call you names.
And I mean these are adults that did this, and
it's slowed the whole thing down months. It really cost
the Trump administration of the Republican Party a lot. There's thirty,
like thirty people. Now that number is now down to
(28:18):
three or four people who don't get it at all.
And it really you do have the people who are.
They wake up and they go I could vote with
the rest of the party, or I could vote no
and be on TV tonight. What we have seemed to
have mastered is the following. There are ten people who
(28:40):
can't live, can't breathe can't live without breathing or being
on Fox. You have to do breathing and being on
Fox to be technically alive in their mind. And they
will for the ten to fifteen days before the vote,
tell everyone I'm a hard no. So they get on
TV a lot and then they vote yes. Okay, I
(29:03):
can live with that.
Speaker 1 (29:05):
Yeah, I mean, all of this is all of this
is political theater. Anyway. The shutdown, certainly for the Democrats,
was all about political theater. They try first and foremost.
We know that their first impulse the Democrats in Congress,
the Democrat Party in general, is to do whatever they
(29:28):
can to diminish Trump and the administration. They've learned nothing
from the first Trump administration. They're doing the same, and
one could argue at a more intense pace, with greater
insanity than they did even in the first term. But
(29:49):
when we talk about Obamacare moving forward, that was the
hill that they, the Democrats chose to die on. They're
going to be screaming about bringing back and this is
what people don't fully understand. And I know you folks
have explained it very well over the last several weeks,
in particular, that what they were fighting for was a
(30:13):
half trillion dollars for an extension that should never have
been to begin with, but it was. It was delivered
because there was a so called COVID pandemic emergency. We
are well beyond COVID and that emergency, and yet the
(30:33):
hits kept up, kept on coming, and the Democrats wanted
it to go on indefinitely. And so if Americans really
fully understood that, I think there would be a much
different sense on all of this ultimately, but they're going
to want this eventually, the Democrats, and that means that
either they're going to make they're going to try to
(30:54):
make Republicans' lives a living hell by trying to along
with their bliss media friends telling everybody, Oh, the Republicans
they want to take health insurance away from the destitute
and the poor, and that is absolutely not the case.
So everything their messaging I see moving forward is all
(31:16):
on that. Are you concerned that eventually, you know, there's
going to be a vote and there will be those
few Republicans who joined the Democrats.
Speaker 2 (31:27):
No, because it won't work. One that you have the
president with the veto, and the Republicans have learned how
to make this case and they feel comfortable doing that.
All during the shutdown, there was an effort by the
press to find the one or two Republican senators or
(31:48):
one or two Congressmen that were having impure thoughts on
the idea of a compromise with the Democrats on given
the massive spending increases, and each time they sort of
turn into well, somebody had a microphone in front of
them and they said, well, if you did this, this
and this, then maybe we could do the other. And
(32:08):
their list of things that they thought would be necessary
to accomplish the Democrats would never agree to. So it
wasn't a fold, it was an and which is why
I urged all Republican conversations not to discuss any quid
pro quo, because the establishment press would mention your willingness
(32:29):
to increase spending by hundreds of millions of dollars and
never mentioned some terribly wonderful thing that you could imagine,
but the Democrats would never agree to, and so the
press would simply read Republican endorse's acts. That happened once
or twice, but interestingly very few times compared to the
(32:51):
earlier fight with Obama on are we going to raise
taxes to deal with the the Democrats were desperately trying
to raise taxes in the Big budget deal, and eventually
we had everybody to take the pledge, and so they
refused to, and we got all spending cuts they wanted.
(33:14):
Because I talked directly to Senator Kerry of Massachusetts, he
ran into me on the in the in the Capitol
building and said, go over Grover, your, your wife and mine.
I should have tea. Yes, that's fine. What do you want?
And he said, well, I've got this, you know. Could
you talk to the Republicans. All we need is for
them to agree to a one point four trillion dollar
(33:36):
tax increase, and said, I thought we were trying to
fill a one point two trillion dollar gap. Oh yes,
but the President needs four hundred billion dollars in higher
spending in our deficit reduction package. And I'm trying not
to laugh now, he said, and there is this two
hundred billion we can all agree on cutting. That's why
(33:58):
it's we get to point for trillion and higher taxes.
And I was so taken aback at the idea that
he expected me to go convince the Republicans to vote
for a tax increase that I forgot to ask tell
me about this two hundred billion. I know nothing about
this bipartisan consensus on saying that two hundred billion does
Why don't we do that now? First? But eventually we
(34:21):
went we got this a quester and we got all
spending cuts, no tax increase at all, because the party
held together.
Speaker 1 (34:31):
Wait, sitting Democrat, I have to ask you this, did
Carrie fall down? Did he know who he was talking to?
You've been at this thing for a long time, You've
had the pledge out as we talked about for forty years.
This is not Why would he go up to Grover
nor Quist and say, hey, you got to talk to
(34:52):
Republicans about doing everything opposite of what you've asked them
to do over the last forty years.
Speaker 2 (35:01):
I don't know. We're both from Massachusetts, Sorr. I tried
to play on that, but I think that's a rather
than read myself because when I was in my twenties,
I immigrated to the United States from Massachusetts. That was
really back in my early days.
Speaker 1 (35:16):
A lot of people say that now when they're from
Illinois and they leave that part of the Midwest. Yes, hey,
we're coming to the end of our journey. And before
we say a do I did want to ask you
now that this shutdown nonsense is over. Now we're getting
ready to get into twenty twenty six. Obviously it's a
(35:42):
big year for politics. It's the midterms. We're going to
see what Americans think about it all. But one thing
is for sure, that's when the big beautiful bill and
all of its tax reductions come into play. I'm curious
what that will mean as we move closer and closer
(36:02):
to the mid terms. November twenty twenty six, What do
you think a.
Speaker 2 (36:06):
Couple of things. I think that we're already seeing significant
investments being announced in Americans for tax reform. We have
good news from the big beautiful bill. We did this
for the first Trump tax cut, and just comb the
headlines of local papers of people expanding the number of
(36:30):
folks that they hired in a restaurant, or putting new
investments in one just got new locally made furniture. Because
of the faster depreciation schedules that now are available to everybody,
we're seeing an increase an investment there. There's a level
of uncertainty that flows. So the President used tariffs as
(36:53):
a way to get other countries to negotiate with other
countries to do a better deal of how they treated
us and trade. Well, that was helpful, but during it
there would be this. The President was saying, to have
one hundred percent tacks on Canada or Mexico or something.
But you can imagine what that does to the stock
market and to somebody's ability to make an investment or
(37:14):
make a decision, because who knows what the price of
coffee is going to be next week. If tariffs are
in and out. Two things are happening. The presidents said look,
those things that come in that really don't compete with
ourgn company's coffee and a lot of fruit during certain
periods of the year, We're not going to tariffs on that, okay.
So that gives you some certitude, and the Supreme Court's
(37:38):
going to rule that some of what the President did
on tariffs, I would assume that where there was a
federal law that Reagan used to selectively tariff Japanese products
in the nineteen eighties because they were cheating and stealing
some of our intellectual property and things like that, and
(38:03):
it was temporary and you had to make the case
for it, I think those will stand, but some of
the others will be frozen or not allowed to exist.
So we should in two months know exactly what tariffs
are going to look like for the next set of years,
and that will allow everybody to feel much more comfortable
(38:25):
about their supply chains, but also about what they do
and don't invest in, because the uncertainty of tariffs could
go one way or the other while there's negotiation going on.
Will be reduced, not eliminated. I don't guess it never
complete limit, but it's reduced, and the good the reduction
(38:48):
in spending that was otherwise going to happen will take place.
But there's one others that some of your listeners may
not be aware of. It's a project the president tried
to do in his first term, but his Secretary of
Treasury got slow walked by his staff, and that is
(39:08):
to end capital gains taxes on inflation. So when you
sell your house, you go, oh, my goodness, I sold
my house for one hundred thousand dollars more than I
paid for it. Yeah, but half of that was Biden's inflation, okay,
and half of its real game. So you would take
out of what you paid capital gains on the inflation
(39:32):
that took place for as long as you held your
house from when you bought it, or stocks you bought
thirty years ago, or the small business you started twenty
five years ago, all of these things allow you. Basically,
it's a significant cut in the capital gains taxes, and
one by the way that Schumer has endorsed in the past.
(39:53):
Democratic Senate voted for this policy and the Democratic House
is voted for it in previous years. They would argue,
we don't want a different rate on capital gains, but
we do recognize that you shouldn't pay taxes on inflation
it has for purposes of growth, it has the same effect.
It's a significant rate reduction on the increase of your
(40:18):
assets inflation plus regular gain. If we do that, it
will tremendously increase the wealth that Americans own and their
land and their property and their farms, in their investments,
in their small businesses. And when they do sell, they
know whatever they decide to sell, they know that the
(40:39):
capital gains tax will be a fraction of what it
would have been without this. And this can be done
through rulemaking over at Treasury. Treasury Secretaries is supportive of
this idea. The President is supportive of it. I talked
to both of them recently, and yes, getting this done
(41:02):
all the people who will decide to sell their houses now,
not twenty years from now. Because in the past, you
hold a house long enough, you live in it, and
you think, well, I'd like to go move and be
closer to kids, or move for the weather, or sell
the house and use that money to do other things
with But the capital gains tax because of inflation, was
(41:25):
so high people would wait until they passed away and
there was you don't have to pick capital gains on
it when you die, but you do until you die.
So this would say, this would allow you to sell
things twenty thirty years earlier than you might otherwise pass
(41:49):
them on to children. This will pre up housing for
young families in a way that nothing else would. And
I talked to several Republican Congressmen who said this is
much bigger than any of the other issues we've dealt
with in housing. This would and the Realtors Association said
this would change everything. This would get many, many more
(42:09):
houses out on the market, so people would have the
size house they need, not the one they're stuck with
because of tax policy.
Speaker 1 (42:17):
That's right, And what is one of the most pressing
issues and what we've heard about certainly over the last
several weeks months, really moving into these blue state elections
earlier this month, and that's the affordability issue. And that's
principally at the house side of things. I mean, you
(42:38):
had to be forty years old before you can buy
a house. That really is a crack in the American dream,
to say the very least. So I would imagine too,
just as a finer point on that that frees up
the housing stock, that takes care of a big issue
in the economy, or it goes a long way to
(42:59):
help that issue. But that also releases some investment funds
that have been on the sidelines for businesses. That means
job growth and capital growth and all of those things
always good for the economy.
Speaker 2 (43:14):
In small businesses that you might decide you wanted to
sell when you are fifty or sixty and not hold
on until you pass away. You get to make the
decisions based on your needs as a family, as a couple,
as an individual, not Uncle Sam's stupid laws and Uncle
(43:35):
Sam's technical Sam's inflation. Reagan said it is wrong for
people to be pushed into higher tax brackets on the
personal income tax because of inflation, and he changed that
so that the tax brackets move up with inflation. So
if you get a pay increase, you may pay you
(43:56):
maybe even to hire a tax bracket, but not if
that pay increase is just as much as inflation. Has
to be a real pay increase.
Speaker 1 (44:04):
Right, absolutely well, And that's hopefully what we're seeing a
return after four long years in the desert, a return
to that kind of common sense that really has meaningful impact.
And I think they're you know, people have all kinds
of things that go into a bill, especially one big
beautiful bill. Some things you really like, some things you
(44:26):
really don't. But the tax reduction, the tax relief aspect
of all of this is so critical I think to
moving this country forward and quite frankly, the prospects of
conservatives who want to keep this republic on the right path.
Thanks to my guest today, Grover and Norquist, President of
Americans for Tax Reform, you've been listening to another edition
(44:50):
to the Federalist Radio Hour. I'm Matt Kittle, Senior Elections
correspondent at the Federalist. We'll be back soon with more.
Until then, stay lovers of freedom and anxious for the fray.
Speaker 2 (45:08):
I heard the fame voice, the Reason, and then it
faded away.
And we are back with another edition of the Federalist
Radio Hour. I'm Matt Kittle, Senior Elections correspondent at the
Federalist and your experienced Shirpa on today's quest for Knowledge.
As always, you can email the show at radio at
the Federalist dot com, follow us on x at FDR LST,
make sure to subscribe wherever you download your podcast, and
(00:40):
of course to our premium version of our website as well.
Our guest today needs no introduction, but because this is
a podcast and an audio only podcast at that, I
think in introduction is necessary. It is Grover Norquist joining
US President of Americans for Tax Reform. We have much
to talk about on the tax reform area, particularly after
(01:03):
a long and stupid government shut down that well, at
the end of the day, let's face it, when we
have a shutdown, it's the American taxpayer that ultimately gets screwed. Grover,
thank you so much for joining us on this edition
of the Federalist Radio Hour.
Speaker 2 (01:22):
So Matt, thank you delighted to be with you.
Speaker 1 (01:24):
Absolutely listen. By the way, first and foremost, let me
say happy fortieth anniversary.
Speaker 2 (01:31):
Yes, it is the fortieth anniversary of the taxpayer Protection Pledge,
and I came up with it nineteen eighty six in
order to help pass the Tax Reform Act of nineteen
eighty six, and a lot of Republicans said, you know what,
if we broaden the base, mean get rid of deductions
(01:52):
and credits, and reduce the right in a way that
doesn't raise our reduce taxes. Democrats want to reduce taxes,
Republicans weren't going to raise them, so they they took
the rates down. Top rate was twenty seven. The two
rates fifteen and twenty seven. How far we've gone from that.
Thank you George Doub Herbert Walker Bushes starting that process,
(02:18):
opening the door to the Democrats to do it. But
at the time we were passing this much lower rate.
And the pledge says I will oppose and vote against
any efforts to increase rates or to broaden the base
unless rates come down. So no net tax increase period ever,
not for any reason, ever whatever.
Speaker 1 (02:39):
Read my lips right that he signed the pledge.
Speaker 2 (02:43):
When he ran for president, and he said read my lips. Actually,
what Bush said was stronger than read my lips. The
whole section of that speech was the I know what's
going to happen that the Democrats will come to me
and they'll ask for a tax increase, and I will
say no. They'll come back and ask again for a
(03:04):
tax increase, and I will say no. And they'll come
again the third time, and I will say, read my lips,
no new taxes, which is a much stronger statement, because
he outlined exactly what the Democrats did, and then forgot
to mention that he folded on the third time they asked.
Speaker 1 (03:27):
We've seen a lot of that folding, of course, over
the last forty years, but we've also seen, thanks to
the pledge, a lot of conservatives at least. And every
once in a while you'll get a well, I guess
I should ask that have you ever gotten a Democrat?
I think you have over the years, have you not?
Speaker 2 (03:47):
Yes. The first year we put it out, nineteen eighty six,
I had two senators and five Democrats. And when push
then in nineteen ninety four, these two Democratic senators and
(04:11):
one from Alabama went from Colorado, and five Democratic congressmen.
After the nineteen ninety three election, which happened to be
the first election when ninety six percent of Republicans signed
the pledge never to raise taxes incumbents. The first time
we did it, we had twenty Senators and one hundred congressman.
(04:33):
So it was a good number, I mean, you know,
a strong support. Most issues couldn't get that many guys
to sign on. But when we went with ninety six
percent of Republicans in the House and Senate, that was
the year Republicans won the House and the Senate. And
since that date nineteen ninety four, the Republicans have won
(04:57):
the House and the Senate eighteen years, the Democrats for six,
and it was split fifty to fifty six years before
that year when the Republicans said we are not raising
taxes ever, ever, and again this was everybody, This is
(05:18):
John mcain, this is you know, conservatives, moderates. Everybody said,
you know, we're not raising taxes. Some moderates may not
have been for big tax cuts, but they were against
any tax increase. And for the sixty two years before
nineteen ninety four, nineteen thirty two till nineteen ninety four,
(05:40):
from FDR coming in to Gingrich coming in in that
sixty two years, Republicans won the Congress twice, yes twice.
That we had a one party state for sixty two years.
I'm sorry, but Eisenhower being president, anything that they wanted
that he vetoed, they just wait till we moved. And
(06:02):
the same thing with Nixon, and frankly, the same thing
with Reagan. They just said, we'll wait till you're gone,
because we own Congress always and forever, and Congress runs
the country. They passed the laws, they raised the taxes,
they approved Supreme Court justices. Presidents have scandals and start wars,
(06:22):
but that's all they get to do, and then they
can detail things. They can slow stuff down, which is
very important, but it's a limited tool. We didn't have
the ability to do anything by Republicans alone. We had
to have Democrat support. Whereas Democrats when they did the
New Deal had eighty percent House and Senate, so they
(06:46):
just bram rotted it. When they did the Great Society,
it was seventy percent House and Senates, and so that
really was a shift. And if you look at a
chart that Americans for Tax Reformed put out, you see
this sea of blue for sixty two years, and then
(07:07):
you know mostly red three times as often red Congress
as blue eighteen versus six years. That changed the country.
But it also meant the Democrats who used to say
keep the president weak because sometimes we have a scandal
that the Republicans get the presidency, but we know we
(07:27):
own Congress. So they stuffed all the power in Congress.
Now they're in a panic because they don't own Congress
all the time. Matter of fact, they own it less
often than the Republicans do. So they tried to stick
the power in Supreme Court. Well, oops, they want that
one too. Then they went in for the bureaucracy. And
although they've been doing that one for a long time.
(07:49):
Stick the power in the bureaucracy. The president can do
what he wants. But if independent bureaucracies fcc icc irs
can act on their own, they can new to the presidency.
Or if the president tries to disagree with a bureaucrat,
andy not elect the bureaucrat. This town acts as if
he'd been cheating, if he was becoming a king, because
(08:13):
he wanted to execut to run executive power. And now
the Democrats without they owned the presidents. You know, they
win the presidency fifty to fifty. We've been doing that
since Eisenhower. But the Congress is more Republican. The Supreme
Court does not have the thumb on the scale for
(08:35):
the Democrats, and the bureaucracy is being changed in that
the Supreme Court is ruled that, you know, bureaucrats can't
make decisions, only Congress and the President can, which would
please the Democrats find when they own the Congress all
the time, but they're not crazy about having decisions go
(08:57):
to Congress now. No.
Speaker 1 (08:59):
Exactly, in fact, Congress is you know, on both sides,
one could argue that, you know, and this is what
the shutdown really gets down to, is that both sides
have abdicated its first branch, main priority, and that is
first and foremost to put together a budget and hopefully
a budget that doesn't continue to sock it to the
(09:21):
American taxpayer. If I could use the turning of phrase
from Richard Milhouse Nixon on laugh In so many years
ago when he said sock it to me, that's exactly
what Democrats have done for a long time. So basically
what we've had, what we had in this country for
sixty plus years was the state of California in Congress.
(09:43):
Although I would hasten to say the Democrats of yr
would not recognize a tip O'Neill would not much recognize
a Democrat of twenty twenty five.
Speaker 2 (09:57):
Do you agree, yes on the cultural issues, but you
can know the economic issues and even to a large
extent on the foreign policy issues. That Democrats had some
great weaknesses during the Cold War, but they at least
know which side they were theoretically on. Maybe half of
them did anyway.
Speaker 1 (10:20):
Yeah, it's amazing to think how much has really changed
on that front. So that brings us to the modern
day and why your battle forty years later continues to
be such an important battle, And that is to make
sure with a country with a thirty seven plus trillion
dollar debt annual trillions of dollars in deficits, that Congress
(10:49):
get this thing under control, because that's who has the
power to do it. So with all of that said,
what do you think of the longest shutdown in American
history that finally this week ended.
Speaker 2 (11:03):
It was very interesting because there were different reasons why
different players did what they did, whereas a few years
ago they played it differently. And the Schumer, Senator Schumer
of New York, the Senate leader for the Democrats, a
(11:24):
wild liberal but not part of the new socialist wing
of the Democratic Party.
Speaker 1 (11:33):
Mom Donnie wing.
Speaker 2 (11:36):
The Madonni Win, the AOC wing, the Bernie Sanders wing,
and and he's a realist. He realizes you don't run
Bolsheviks for the Senate in you know, British states. You
can do that in Vermont, but not other places. And
so he said seven months ago to the Democrats, do
(12:02):
the continuing resolution the Republicans are suggesting, which takes it
out seven at the time, I think it was seven months,
because if you don't, we will be response. If we don't,
we will be responsible for shutting the government down. Because
the Republicans had put together budgets and the Democrats were stalling,
(12:24):
you know, participating and doing a budget for the Defense
Department and the act Department, the education departments on the
way one normally did them before nineteen ninety four, back
when the Democrats had the majorities in the House and Senate.
They always did regular order, and sometimes the Republicans in
the committee might make a good argument or have a
(12:45):
bunch of Democrats on their side, and so some Republican
thing of interest would get into the budget that they
weren't completely shut out, but it was rare and if
they if the party really cared it wasn't going to happen.
So since ninety four, the Democrats have said, you know,
we really want just put the whole budget in one
(13:06):
big pile. We're not going to do regular order, and
we will have a list of things that we insist
being that pile, and that that basically pay us for
all of our political allies. And then the budget will
be written by a small committee of the head of
the Democratic Party the head of the Republican Party in
(13:27):
the House in the Senate, not by big committees and
so on. And this will may give the Democrats half
the power, even though they don't have either house. And
that's why we went away from regular order. The Democrats
didn't want it. It didn't fit their interests. And so
(13:49):
he was saying, you know, now, we can't do this.
We can't give the Republicans control over writing the budget.
And he convinced his team the Democrats crazy ones too, Okay,
we'll kick the can down seven months. By the time,
they'd had seven months of Trump being on three of
(14:11):
the seven headlines in the Washington Post every day day
after day, Trump does this, Trump does that, Trump does this,
and uh, making all sorts of decisions and executive orders
and the Republicans in Congress doing different things. They were
just frustrated. They felt beat up, they felt ignored, they
(14:33):
felt unloved. And my sense is it was a little
bit like that second of the last scene in Animal
House where they're about to be thrown The misbehaving black
boys have all been expelled from school and they're going
to close down their fraternity, and someone comes up and says,
(14:55):
you know, this is the time to do something truly
stupid and futile. Yes, and all the guys are yeah,
So that's us, And they run outside and they go
do something stupid that didn't keep them from getting expelled,
didn't keep the fraternity from being shut down, but it
made them feel good.
Speaker 1 (15:17):
The John who played the John Belushi role, the Blueto role,
who said was it over when the Germans bombed Pearl Harbor,
It's the same kind of logic, right, I.
Speaker 2 (15:28):
Think that was Bernie and AOC. Yeah, we've got to
do this. It's important. Will it work? It's important. We
have to do this. Will it work? It's important. We
have to do this. Our base wants to see us fighting.
Now sitting in a committee and getting out voted doesn't
qualify as being seen as fighting. No, that's the best
(15:49):
you can do with inside a constitutional order. So they said, no,
we're going to close the government down. And Schumer, who
he's the role of the guy who was standing in
front of the jail trying to get the lynch mob
from doing the guy who's in the jail says, don't
do this, don't do this, it's wrong. At some point goes, oh, hell,
(16:10):
I'm their leader, and he turns around and he joins
the lynch mob and he starts acting like he was
Bernie Sanders. We're going to do this. We're going to
do that. It's going to work. If they had a plan,
it is unclear what it was. I think they were
hoping that the press would say the Republicans closed the
government down, even though the Democrats clearly had and they
(16:32):
couldn't even get the Washington Post a life for them
on that sort of thing. So that didn't work. And
their demands were massive new spending when everybody had been
talking about the deficit. Even the Democrats were you can't
cut taxes, there's a deficit, but we can spend one
point five trillion dollars more So, they crashed and burned.
(17:00):
We ate Democrats. Eventually, there were always some Democrats voting
with the Republicans, so it was never just a partisan effort.
The Republicans kept saying every day that the Republicans would
make the Democrats in the Senate vote against opening government
and then against paying the troops, and then against paying
the FAA air traffic controls. I mean, they're Democrats running
(17:23):
for Senate with real pretty wacky votes out there in
front of them. So you voted against paying veterans benefits,
against paying you know. I mean, just on and on
and on, and they got to the end and they
gave up. They lost. They're not even pretending that they
(17:47):
won something. They didn't get any any of the big
things that they wanted, if they got little things here
or there. The America, the federal workers who came back
back got paid for their time, which always happens. But
we let the Democrats think it was a concession because
(18:08):
made them feel good, but it wasn't. So we're now
pivoting and the big question is what was this about?
And the answer is it was all about the Democrats
needing four or five hundred billion dollars to subsidize the
failure of Obamacare. Obamacare, we painfully remember we were told
(18:31):
you could keep your doctor. That was a lie. Even
the Washington Post called it the biggest lie of the year.
The Washington Post printed that after the bill passed. We
didn't talk about it before the bill passed.
Speaker 1 (18:44):
That's the courage of the Washington Post right there, Exhibit A.
Speaker 2 (18:50):
They will tell the truth once once right, a Republican
scandal becomes the guy's middle name. A Democratic scandal is
mentioned once on page be thirty seven. But so now
we have a discussion where the Republicans are saying, in
(19:11):
the next tax bill, we want to expand health savings
accounts so that every American can have a health savings account,
which allows you an off ramp from Obamacare. And seventy
million people have a health savings account w It's like
an IRA or four O n K, but for health care.
You put in some money or the company may put
(19:32):
in all the money. But then you decide how to
spend it, and it gives you control on what you
buy and don't buy. And if you don't use it,
you get to save it and it accumulates for future
needs or crisis or something. They're very great project lines.
And then the Republicans have been wanting to increase health
(19:54):
savings accounts, but the Democrats put in rules to make
it difficult to expand them. Those are the things that
will be dismantling in the spring and opening up for
people to view. And the deeds will say you should
have subsidized, you should have passed the subsidies, and the
answer to that is that included people who make as
(20:16):
much as five hundred thousand dollars a year. We're getting
some of these subsidies. Many of those subsidies went straight
to the insurance companies and no person ever you made
use of them, never put in a claim at all
at all. I mean millions of people didn't, which makes
you wonder whether the insurance companies just signed up people
(20:39):
and they didn't even know maybe that they had the healthcare.
That's one of the things they're looking at now. How
could you possibly have had this huge group of millions
of people who supposedly bought healthcare for free. Thank you
to Obamacare and taxpayers.
Speaker 3 (20:56):
Actually should social media influencers register like lobbyists. The watched
Out on Wall Street podcast with Chris Markowski. Every Day,
Chris helps unpack the connection between politics and the economy
and how it affects your wallet. Some in Congress are
proposing that paid social media influencers publicly disclose who they represent,
(21:18):
especially if they're being paid by foreign countries for their causes.
Whether it's happening in DC or down on Wall Street,
it's affecting you financially. Be informed. Check out the watch
Dot on Wall Street podcast with Chris Markowski on Apple,
Spotify or wherever you get your podcasts.
Speaker 1 (21:34):
Well, that's one of the Yeah, that's one of the
biggest problems with Obamacare has been you know for the
last what fifteen years now, and that is insurance companies,
many of them have gotten rich and the taxpayer has
again to turn the phrase I turned at the beginning
of our conversation, has gotten screwed over and over again.
(21:58):
That's what you have to be watching out for. Coming up.
Our guest today is Grover Norquist, President Americans for Tax Reform,
and so I guess if there was any lesson hopefully
learned by at least some people in this great Republic
of ours, is that Obamacare isn't workable, and quite frankly,
(22:23):
Grover isn't that what Democrats wanted it to be all
the time, you know, from the beginning, And didn't Obama
even say that they wanted it to implode so that
they could go full on socialized healthcare, government funded, government
paid for health care for everyone, which of course would
(22:44):
be even a greater disaster.
Speaker 2 (22:47):
Yes, they believed when they passed Obamacare, because they had
sixty votes in the Senate briefly, that they were now
invincible and that their victory with Obama and the House,
and it meant that it was back to FDR days.
All they had to do was do healthcare, lock everyone
(23:08):
into government control of healthcare, and then they would in
the same way that they bought a great number of
votes with welfare, that they would do the same thing
with healthcare. So they were going to be in power.
And as this failed, and you're quite right, they talked
openly about the course it's going to fail, and when
it failed, they kept, oh my goodness, it's failed. Kind
(23:31):
of like the teachers union lobby the public. Our teachers
are not teaching kids how to read by fourth grade,
and they're not graduating, and their way behind the Japanese
and the Koreans and many other nations. You know what
we need to do. Give more money to the same
(23:52):
people with the same project and the same rules as before,
and that'll fix it. So the worst the public schools,
the more they need to make, the more they should
have more money because this will fix it. Of course
that's nonsense. But they would do the same thing with Obamaca.
They would announce as the British to I mean, you
listen to the politics of Britain. Would everything's go wrong
(24:14):
and they start continuing to ration care and so on,
Send more money, don't fix the problem, Just keep the
present government monopoly in place and raise everyone's.
Speaker 1 (24:26):
Pay right, Yeah, over and over again. And so if
the definition of insanity is failing over and over again
and continuing on that path, we certainly have had that
in Obamacare. You talk to your organization, talks to members
(24:49):
of Congress on a daily basis. You got through this
fight with republic Well, first of all, are you surprised
that you didn't have some case from Republicans in this
long battle? Because while Americans, I think knew who shut
down this government, there was a lot of noise and
(25:11):
a very dishonest corporate media press in many circles that
kept trying to make this a Republican thing when obviously
it was not. Were you surprised that there was backbone
and unity in all of this.
Speaker 2 (25:30):
Yeah, Every once in a while, some of my friends
on the right go, oh, the Republicans failed to do
this or refused to do this. Meaning three people in
the House and two people or two people in the
Senate didn't vote with the rest of the party. Okay,
that's not the Republicans failing to do something. When John
(25:51):
McCain stabbed us all in the back, having promised that
very day, he'd promised that he would be voting for
the reform of Obamacare back in the first Trump turn,
and he was mad about something and decided to vote
no on the most important reform of entitlements ever in history,
(26:15):
and something that he was born ideologically a liberal. He
was just a little self centered, and.
Speaker 1 (26:27):
So he votes no.
Speaker 2 (26:28):
Right, That wasn't the Republicans losing. That was John McCain
deciding to do something that was in his personal interest.
He thought, I'm not sure I want to go down
in history as having that on my tombstone. Refused to
reform government spending because he actually was more often than
(26:48):
not in favor of reducing government spending. He just literally
had peaque. But if you have a one or two
vote majority and you need fifty votes or two un
and eighteen in the House, somebody's all he's cranky about something.
And in the House side you get every once in
a while, somebody's not voting with you to go. I
(27:09):
just listened to that person explain it. I have no
idea what they're talking about. They weren't being liberals in
most cases. As a matter of fact, that the people
who killed the earliest tax reform that Trump had were
about thirty conservatives who didn't understand that with the reconciliation package,
you can't change laws. You can only change budget numbers.
(27:31):
And they said, we're not doing this until it includes
abolishing Obamacare, which would require changing laws, which you can't
do because the law is written to say you can
do a reconciliation package on budget numbers, not repeal the
right to work law, not pology, and on policy. And
we had thirty people who got elected to Congress who
(27:54):
didn't understand that, and they just shouted louder and louder.
I'm going to hold my breath until I turned blue.
And if you don't do this, I can call you names.
And I mean these are adults that did this, and
it's slowed the whole thing down months. It really cost
the Trump administration of the Republican Party a lot. There's thirty,
like thirty people. Now that number is now down to
(28:18):
three or four people who don't get it at all.
And it really you do have the people who are.
They wake up and they go I could vote with
the rest of the party, or I could vote no
and be on TV tonight. What we have seemed to
have mastered is the following. There are ten people who
(28:40):
can't live, can't breathe can't live without breathing or being
on Fox. You have to do breathing and being on
Fox to be technically alive in their mind. And they
will for the ten to fifteen days before the vote,
tell everyone I'm a hard no. So they get on
TV a lot and then they vote yes. Okay, I
(29:03):
can live with that.
Speaker 1 (29:05):
Yeah, I mean, all of this is all of this
is political theater. Anyway. The shutdown, certainly for the Democrats,
was all about political theater. They try first and foremost.
We know that their first impulse the Democrats in Congress,
the Democrat Party in general, is to do whatever they
(29:28):
can to diminish Trump and the administration. They've learned nothing
from the first Trump administration. They're doing the same, and
one could argue at a more intense pace, with greater
insanity than they did even in the first term. But
(29:49):
when we talk about Obamacare moving forward, that was the
hill that they, the Democrats chose to die on. They're
going to be screaming about bringing back and this is
what people don't fully understand. And I know you folks
have explained it very well over the last several weeks,
in particular, that what they were fighting for was a
(30:13):
half trillion dollars for an extension that should never have
been to begin with, but it was. It was delivered
because there was a so called COVID pandemic emergency. We
are well beyond COVID and that emergency, and yet the
(30:33):
hits kept up, kept on coming, and the Democrats wanted
it to go on indefinitely. And so if Americans really
fully understood that, I think there would be a much
different sense on all of this ultimately, but they're going
to want this eventually, the Democrats, and that means that
either they're going to make they're going to try to
(30:54):
make Republicans' lives a living hell by trying to along
with their bliss media friends telling everybody, Oh, the Republicans
they want to take health insurance away from the destitute
and the poor, and that is absolutely not the case.
So everything their messaging I see moving forward is all
(31:16):
on that. Are you concerned that eventually, you know, there's
going to be a vote and there will be those
few Republicans who joined the Democrats.
Speaker 2 (31:27):
No, because it won't work. One that you have the
president with the veto, and the Republicans have learned how
to make this case and they feel comfortable doing that.
All during the shutdown, there was an effort by the
press to find the one or two Republican senators or
(31:48):
one or two Congressmen that were having impure thoughts on
the idea of a compromise with the Democrats on given
the massive spending increases, and each time they sort of
turn into well, somebody had a microphone in front of
them and they said, well, if you did this, this
and this, then maybe we could do the other. And
(32:08):
their list of things that they thought would be necessary
to accomplish the Democrats would never agree to. So it
wasn't a fold, it was an and which is why
I urged all Republican conversations not to discuss any quid
pro quo, because the establishment press would mention your willingness
(32:29):
to increase spending by hundreds of millions of dollars and
never mentioned some terribly wonderful thing that you could imagine,
but the Democrats would never agree to, and so the
press would simply read Republican endorse's acts. That happened once
or twice, but interestingly very few times compared to the
(32:51):
earlier fight with Obama on are we going to raise
taxes to deal with the the Democrats were desperately trying
to raise taxes in the Big budget deal, and eventually
we had everybody to take the pledge, and so they
refused to, and we got all spending cuts they wanted.
(33:14):
Because I talked directly to Senator Kerry of Massachusetts, he
ran into me on the in the in the Capitol
building and said, go over Grover, your, your wife and mine.
I should have tea. Yes, that's fine. What do you want?
And he said, well, I've got this, you know. Could
you talk to the Republicans. All we need is for
them to agree to a one point four trillion dollar
(33:36):
tax increase, and said, I thought we were trying to
fill a one point two trillion dollar gap. Oh yes,
but the President needs four hundred billion dollars in higher
spending in our deficit reduction package. And I'm trying not
to laugh now, he said, and there is this two
hundred billion we can all agree on cutting. That's why
(33:58):
it's we get to point for trillion and higher taxes.
And I was so taken aback at the idea that
he expected me to go convince the Republicans to vote
for a tax increase that I forgot to ask tell
me about this two hundred billion. I know nothing about
this bipartisan consensus on saying that two hundred billion does
Why don't we do that now? First? But eventually we
(34:21):
went we got this a quester and we got all
spending cuts, no tax increase at all, because the party
held together.
Speaker 1 (34:31):
Wait, sitting Democrat, I have to ask you this, did
Carrie fall down? Did he know who he was talking to?
You've been at this thing for a long time, You've
had the pledge out as we talked about for forty years.
This is not Why would he go up to Grover
nor Quist and say, hey, you got to talk to
(34:52):
Republicans about doing everything opposite of what you've asked them
to do over the last forty years.
Speaker 2 (35:01):
I don't know. We're both from Massachusetts, Sorr. I tried
to play on that, but I think that's a rather
than read myself because when I was in my twenties,
I immigrated to the United States from Massachusetts. That was
really back in my early days.
Speaker 1 (35:16):
A lot of people say that now when they're from
Illinois and they leave that part of the Midwest. Yes, hey,
we're coming to the end of our journey. And before
we say a do I did want to ask you
now that this shutdown nonsense is over. Now we're getting
ready to get into twenty twenty six. Obviously it's a
(35:42):
big year for politics. It's the midterms. We're going to
see what Americans think about it all. But one thing
is for sure, that's when the big beautiful bill and
all of its tax reductions come into play. I'm curious
what that will mean as we move closer and closer
(36:02):
to the mid terms. November twenty twenty six, What do
you think a.
Speaker 2 (36:06):
Couple of things. I think that we're already seeing significant
investments being announced in Americans for tax reform. We have
good news from the big beautiful bill. We did this
for the first Trump tax cut, and just comb the
headlines of local papers of people expanding the number of
(36:30):
folks that they hired in a restaurant, or putting new
investments in one just got new locally made furniture. Because
of the faster depreciation schedules that now are available to everybody,
we're seeing an increase an investment there. There's a level
of uncertainty that flows. So the President used tariffs as
(36:53):
a way to get other countries to negotiate with other
countries to do a better deal of how they treated
us and trade. Well, that was helpful, but during it
there would be this. The President was saying, to have
one hundred percent tacks on Canada or Mexico or something.
But you can imagine what that does to the stock
market and to somebody's ability to make an investment or
(37:14):
make a decision, because who knows what the price of
coffee is going to be next week. If tariffs are
in and out. Two things are happening. The presidents said look,
those things that come in that really don't compete with
ourgn company's coffee and a lot of fruit during certain
periods of the year, We're not going to tariffs on that, okay.
So that gives you some certitude, and the Supreme Court's
(37:38):
going to rule that some of what the President did
on tariffs, I would assume that where there was a
federal law that Reagan used to selectively tariff Japanese products
in the nineteen eighties because they were cheating and stealing
some of our intellectual property and things like that, and
(38:03):
it was temporary and you had to make the case
for it, I think those will stand, but some of
the others will be frozen or not allowed to exist.
So we should in two months know exactly what tariffs
are going to look like for the next set of years,
and that will allow everybody to feel much more comfortable
(38:25):
about their supply chains, but also about what they do
and don't invest in, because the uncertainty of tariffs could
go one way or the other while there's negotiation going on.
Will be reduced, not eliminated. I don't guess it never
complete limit, but it's reduced, and the good the reduction
(38:48):
in spending that was otherwise going to happen will take place.
But there's one others that some of your listeners may
not be aware of. It's a project the president tried
to do in his first term, but his Secretary of
Treasury got slow walked by his staff, and that is
(39:08):
to end capital gains taxes on inflation. So when you
sell your house, you go, oh, my goodness, I sold
my house for one hundred thousand dollars more than I
paid for it. Yeah, but half of that was Biden's inflation, okay,
and half of its real game. So you would take
out of what you paid capital gains on the inflation
(39:32):
that took place for as long as you held your
house from when you bought it, or stocks you bought
thirty years ago, or the small business you started twenty
five years ago, all of these things allow you. Basically,
it's a significant cut in the capital gains taxes, and
one by the way that Schumer has endorsed in the past.
(39:53):
Democratic Senate voted for this policy and the Democratic House
is voted for it in previous years. They would argue,
we don't want a different rate on capital gains, but
we do recognize that you shouldn't pay taxes on inflation
it has for purposes of growth, it has the same effect.
It's a significant rate reduction on the increase of your
(40:18):
assets inflation plus regular gain. If we do that, it
will tremendously increase the wealth that Americans own and their
land and their property and their farms, in their investments,
in their small businesses. And when they do sell, they
know whatever they decide to sell, they know that the
(40:39):
capital gains tax will be a fraction of what it
would have been without this. And this can be done
through rulemaking over at Treasury. Treasury Secretaries is supportive of
this idea. The President is supportive of it. I talked
to both of them recently, and yes, getting this done
(41:02):
all the people who will decide to sell their houses now,
not twenty years from now. Because in the past, you
hold a house long enough, you live in it, and
you think, well, I'd like to go move and be
closer to kids, or move for the weather, or sell
the house and use that money to do other things
with But the capital gains tax because of inflation, was
(41:25):
so high people would wait until they passed away and
there was you don't have to pick capital gains on
it when you die, but you do until you die.
So this would say, this would allow you to sell
things twenty thirty years earlier than you might otherwise pass
(41:49):
them on to children. This will pre up housing for
young families in a way that nothing else would. And
I talked to several Republican Congressmen who said this is
much bigger than any of the other issues we've dealt
with in housing. This would and the Realtors Association said
this would change everything. This would get many, many more
(42:09):
houses out on the market, so people would have the
size house they need, not the one they're stuck with
because of tax policy.
Speaker 1 (42:17):
That's right, And what is one of the most pressing
issues and what we've heard about certainly over the last
several weeks months, really moving into these blue state elections
earlier this month, and that's the affordability issue. And that's
principally at the house side of things. I mean, you
(42:38):
had to be forty years old before you can buy
a house. That really is a crack in the American dream,
to say the very least. So I would imagine too,
just as a finer point on that that frees up
the housing stock, that takes care of a big issue
in the economy, or it goes a long way to
(42:59):
help that issue. But that also releases some investment funds
that have been on the sidelines for businesses. That means
job growth and capital growth and all of those things
always good for the economy.
Speaker 2 (43:14):
In small businesses that you might decide you wanted to
sell when you are fifty or sixty and not hold
on until you pass away. You get to make the
decisions based on your needs as a family, as a couple,
as an individual, not Uncle Sam's stupid laws and Uncle
(43:35):
Sam's technical Sam's inflation. Reagan said it is wrong for
people to be pushed into higher tax brackets on the
personal income tax because of inflation, and he changed that
so that the tax brackets move up with inflation. So
if you get a pay increase, you may pay you
(43:56):
maybe even to hire a tax bracket, but not if
that pay increase is just as much as inflation. Has
to be a real pay increase.
Speaker 1 (44:04):
Right, absolutely well, And that's hopefully what we're seeing a
return after four long years in the desert, a return
to that kind of common sense that really has meaningful impact.
And I think they're you know, people have all kinds
of things that go into a bill, especially one big
beautiful bill. Some things you really like, some things you
(44:26):
really don't. But the tax reduction, the tax relief aspect
of all of this is so critical I think to
moving this country forward and quite frankly, the prospects of
conservatives who want to keep this republic on the right path.
Thanks to my guest today, Grover and Norquist, President of
Americans for Tax Reform, you've been listening to another edition
(44:50):
to the Federalist Radio Hour. I'm Matt Kittle, Senior Elections
correspondent at the Federalist. We'll be back soon with more.
Until then, stay lovers of freedom and anxious for the fray.
Speaker 2 (45:08):
I heard the fame voice, the Reason, and then it
faded away.
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