September 25, 2024 • 15 mins
CONGRESS KICKS THE SPENDING CAN DOWN THE ROAD And once again pass a giant Continuing Resolution to keep spending until the end of December. Do you really think they are going to craft and pass 12 spending bills before Christmas? No, they won't. That means either another Continuing Resolution or a giant pork filled Omnibus bill that allows everyone in Congress to hide the pork they are bringing back to their districts so they can keep getting re elected. I've got Former White House OMB Chief Economist, Vance Ginn, Ph.D., today at 2:30. We're talking about how Congress is pretending that there is not a spending crisis. It’s time to address the root issue — overspending. Excessive government spending and deficits lead to inflation, higher prices, and a weaker dollar. When the government runs deficits, the Federal Reserve prints more money by mostly buying Treasury securities to cover the deficit. Find Dr. Ginn's website and sign up for his newsletter here.
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Episode Transcript
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Speaker 1 (00:00):
Doctor Van Skin.
Speaker 2 (00:01):
He's an economist and a smart guy, and he's as
annoyed as I am that once again Congress has completely
abdicated their responsibility to pass budget bills and have just
passed another continuing resolution.
Speaker 1 (00:14):
Vance, Welcome to the show. Hi many, it's a pleasure
with you.
Speaker 3 (00:19):
Thank you for having me on, and I am just
as upset about the deficit spending as you.
Speaker 2 (00:24):
Now, what is your background? Give my listeners a little
bit of window of who you are.
Speaker 1 (00:27):
Vance.
Speaker 3 (00:30):
Yeah, so I worked at the Trump White House. I
was the chief economist for the Office of Management and
Budget for about a year from June twenty nineteen and
May of twenty twenty. I've also worked with a lot
of state think tanks and national think tanks across the
country and.
Speaker 1 (00:44):
Do a lot of other work.
Speaker 3 (00:45):
I also have a podcast called Let Fuel Prosper where
I talk a lot about these key important issues about
fiscal budgeting and monetary policy and a whole bunch of
other issues.
Speaker 2 (00:54):
So, Vance, if you were part of the Trump administration,
then I'm gonna ask you a pointed question, because for me,
that was a big area of disappointment, and COVID threw
everything into chaos, So we don't know what would have
happened had his economic policies been allowed to unfold in
a natural way. So I'm going to concede that point.
But spending in the Trump administration, even before COVID was
(01:15):
well beyond what I thought it should have been. Is
there any hope that in another Trump administration we're going
to see And I'm not asking to speak for the
Trump campaign, by the way, I'm not doing that, but
what are your thoughts about the level of seriousness that
debt and deficit spending are seen in that administration?
Speaker 3 (01:35):
Well, I also share your concern about how much was
being spent during the Trump of years. Of course, it
was Congress that spent passes the budgets, but the president
could have vetoed them and done more to do that,
and we were trying to behind the scenes. We were
trying to push it to have lower spending at the
end of the day, and you're right, COVID blew that
out of the water even more with trillions of dollars,
and then Biden administration came in and put that spending
(01:57):
on steroids. So we've run up of another twelve trillion
dollars just so the last four plus years as massive,
and we're spending at trillion dollars just on that interest
payments on the debt alone.
Speaker 1 (02:07):
It's just ridiculous.
Speaker 3 (02:07):
And so one of the things that I'm still concerned about, though,
to your point, Mandy, is that the president hasn't taught
much about the budget. I mean, during that last presidential
debate or even the first one, I don't even think
spending was mentioned at all, or the deficits were mentioned
it at all. And this is a huge concern for
me that I talk a lot about and I know
you do too as well. So this is something we've
(02:28):
got to get control over. And it's both parties. I mean,
this is a bipartisan spending crisis, is the way I
like to put it. That's been happening for decades now,
and we've got to get under control. There are a few,
you know, that are out there that will talk a
good game, and I think are trying to do good things.
Senter Ran Paul had his six penny plan, which would
basically cut six percent over the next few years and
balance the budget, but that was rejected today. At the
(02:51):
same time, they're spending in the cr bill more and
more so, it's a massive spending problem.
Speaker 1 (02:57):
Ran Paul.
Speaker 2 (02:57):
I lived in Kentucky for three years and I'm a
huge and Paul fan, along with Congressman Thomas Massey, who
has been very vocally opposed to the continuing resolutions that
we're seeing.
Speaker 1 (03:07):
Why what I mean, We're.
Speaker 2 (03:09):
Just going to have to get to a debt crisis
situation before anybody in Congress takes so seriously. That's what
I'm afraid of. And what does that look look like
for the American people?
Speaker 3 (03:20):
Well, unfortunately, I think we're seeing a lot of that now.
We saw higher interest rates, right, the interest rates sowar.
That's a big part of what you see during a
debt crisis. We saw inflation soar because the Federal Reserve
printed a lot of that money. I mean their boalance.
You went from four trillion to nine trillion. It's still
seven trillion. It's way too high.
Speaker 1 (03:37):
You know.
Speaker 3 (03:37):
The Federal Reserve cut interest rates by fifty basis points
last week.
Speaker 1 (03:40):
And I think that was a mistake.
Speaker 3 (03:42):
I think we're going to fall into the same traps
we did during the nineteen seventies whenever they cut interest
rates too fast and inflation shot up again. And now
we have even a worse situation because you know, Congress
is overspending more than they were back then, and so
this is going to lead more to increases and ammunition
for the Federal Reserve to print money, increase inflation in
the economy. And so I'm very concerned about a debt crisis.
(04:04):
And the spending crisis is happening now. A lot of
people will blame it on the Trump tax cuts and
other revenue issues, but it's not a revenue problem. This
is clearly a spending problem, and I think what we've
got to do is cut spending today and then restrain
the growth of spending over time. If we do that,
we could find a better path forward, not only for
the spending situation, but for the economy because all this
(04:26):
deficits and debt really matters also to main street and
on the economy because interest rates are soaring and people
can't afford homes and things of that nature. This is
a major problem that's driven by Washington DC.
Speaker 2 (04:38):
I have the video on the blog today by Milton
Friedman from like the late seventies, maybe nineteen eighty. I'm
not sure exactly what the ear is, but he does
this kind of like walk through on inflation, and it's
really at a fifth grade level. I mean, that's why
I put it on the blog. I'm like, if you
have somebody who doesn't understand this, But what it comes
down to, what we're seeing right now and we've seen since,
especially since COVID, is that the Federal Reserve is enabling
(05:01):
the federal government spending by continuing to print money and
buying treasury bonds. So they are if the FED doesn't
keep printing money, then no one's gonna buy those treasury bonds,
and the federal government cannot continue spending, even though.
Speaker 1 (05:15):
The Federal Reserve is supposed to be.
Speaker 2 (05:17):
A non you know, it's supposed to be a non
political entity. So people need to understand that we flooded
the money supply, we flooded the country with money. We
flooded all the markets with money from the FED, and
that's why we are now paying the invisible tax that
is inflation. And too many people do not make that connection.
And it's super frustrating when I hear people say it's
(05:38):
corporate greed, it's you know, it's whatever. And Milton Friedman
actually uses the example of it's not union wages, you know,
because people will blame it on union wages driving those
are a lagging indicator instead of leaking and leading indicator.
So in your in your podcast, what are the kind
of things that you explain when it comes to because
my big thing is this, somebody texts me. We have
(06:00):
a text line and they say things like, you know,
back in the nineteen fifties, we had the highest tax
rates on the one percent and we had prosperity. But
what really happened in the nineteen fifties is the government
contracted all that spending from World War Two and the
economy roared. Why is that lesson lost?
Speaker 1 (06:17):
Yeah? Yeah, it's a great point.
Speaker 3 (06:21):
And Milton Freeman is my favorite economist, so I watch
a lot of his youtubes and I talk a lot
about these things on my podcast like you will prosper
show and try to break it down as simply as possible,
because you're right. I mean, the inflation is an inflation tax.
We all feel it that the crisis that's out there
on spending, we're all feeling it through higher interest rates
today and everything else. And so when people I think
(06:42):
we've lost sight of how good we have it, in
some sense, today, and some people want to go back
to the nineteen fifties or something else. But there's a
lot of things that I think America gets right today.
The problem is in Washington, DC, they don't understand that's
definit spending really matters, and it grows the eyes of government,
which which removes our liberty. The government has no money,
(07:04):
nothing is free, and so they take it from us,
out of the productive private sector, to redistribute it to
someone else. That's all the government spending is. It's not
some candy and sort of logic to where the government
can stimulate the economy and grow in certain areas. No,
what they do is they take it from person A
and give it to person B, and there's no growth
in the economy. In fact, it reduces the economy because
(07:25):
it reduces the productive purposes that are happening before they
tried to redistribute that money. So I think, you know,
Milton Freema is exactly right. Too much money chasing too
few goods is what inflation is. And what we see
in the last especially four years, is a lot of
increasing the money supply driving demand, and then high regulations
at high tax and high spending that have stifled the
(07:46):
supply side of the economy and contributed to massive amount
of inflation. And this is why I think we have
an issue to where whether it's Harris or Trump, right now,
there could be more inflationary pressures because neither one of
them were talking about spending.
Speaker 2 (08:00):
And both of them, you know, I hesitate to call
them dumb ass ideas, but they've piged out some real
dumb ass ideas, both of them. I mean, the Trump
tariff situation is not good for consumers. Harris is trying
to give away more money, but only the people she chooses,
and she, I guess, announced another no interest small business
(08:21):
loan program that if you've never if you've ever dealt
with government loan programs like the SBA, you already.
Speaker 1 (08:27):
Know how cumbersome they are.
Speaker 2 (08:29):
Neither of these people are blazing a trail on economics.
So what does what does an average citizen do? What
do you do if you're worried about this, like I am.
Speaker 3 (08:36):
Yeah, oh man, I've been kind of pulling my hair
out because you know, one day with Trump will talk about, well,
we're gonna exempt taxes on Social Security, then we're going
to exempt taxes on tips and the more that you
narrow the tax base, the higher that the rates are
otherwise going to be, or we're going going to run
massive deficits. Instead, we should have the broadest base possible
with the lowest rates, and hopefully a flat income tax
(08:56):
rate is ultimately what we need, and cut government spending
in the process. But until then, I think, you know,
there's going to be a lot more economic uncertainty. I've
been writing a lot about this at American's for Tax
Reform and American Institute for Economic Research, saying that the
economic concertainty that's being brought forth by both of these campaigns.
Speaker 1 (09:13):
Even though I do think that the Trump campaign.
Speaker 3 (09:15):
Is having a little bit more pro growth policies of
course than the Harris administration, they're both leading to more
economic uncertainty.
Speaker 1 (09:21):
And I'm a free trade guy.
Speaker 3 (09:23):
I debated this a lot with Peter Navarro and others
within the White House. They didn't see it my way,
The presidents didn't see.
Speaker 1 (09:29):
It my way.
Speaker 3 (09:29):
But I really think that free trade is the way
that we will pressure China to change their habits by
putting tariffs on them and everything else. It doesn't change
their ways because they're a communist country.
Speaker 1 (09:40):
They don't care about their people.
Speaker 3 (09:42):
But if you start, if you start changing the dynamics
of other trading partners, now that influences them because that
reduces their power. And I'm hopeful that would be the
way we go. But unfortunately we're talking about tariffs all
the time.
Speaker 1 (09:53):
Well.
Speaker 2 (09:53):
I do think that in some ways Trump has a
very sort of nineteen fifties view of American manufacturing, right,
and I genuinely think he believes we can be the
leader in the world in manufacturing. But the reality is
is that our standard of living is very high now, right,
And that's good, that's great that we have a high
standard of living. So it makes it very difficult, difficult
(10:15):
to compete with places that don't, like China, like Mexico,
like developing economies where they can make things much cheaper
than they can make them here because they pay people
forty bucks a month.
Speaker 1 (10:27):
So I mean, how is there a way? Though?
Speaker 2 (10:30):
I mean, this is something that I think is something
that needs to be addressed, and that is, how do
you ensure that the United States in an emergency situation
can get things done?
Speaker 1 (10:41):
How do we build new aircraft carriers?
Speaker 2 (10:43):
How do we make steal how do we protect those
things that protect our ability to defend ourselves.
Speaker 1 (10:49):
This is totally off the beaten track.
Speaker 2 (10:51):
I don't know if I'm asking you stuff outside your
wheelhouse here.
Speaker 1 (10:53):
No, No, it's fine, it's fine.
Speaker 3 (10:56):
These are all national security type threats, right, and that
I think are legitimate concerns that should be addressed.
Speaker 1 (11:02):
And one of the things that I like to point out.
Speaker 3 (11:04):
Is that when we point our fingers at someone else
like China, we've got three more fingers pointing back at ourselves.
Speaker 1 (11:10):
There's more that we should be doing in America.
Speaker 3 (11:12):
To reduce the cost of business instead of just blaming
other countries, like reducing the corporate income tax rate, which
Trump has talked about reducing it to fifteen percent. I
would like for it to be zero percent, because businesses
don't play pay taxes. People do through the form of
higher prices, lower wages, and fewer jobs. We also should
be reducing regulations. There's a lot of hoops that we've
(11:32):
got to jump jump through in order to get stilled
to the market. There's a lot of jump hoops that
we're going to jump through to get food to the market,
and so much more that if we remove those obstacles,
we ma to be much more competitive and wouldn't have
to blame other countries. And one thing I like to
note too about manufacturing is that where we're reaching manufacturing
highs and output, it's just that the employment has declined
(11:54):
over time. And that's not just because of China and
other countries through trade.
Speaker 1 (11:59):
A lot of it was through.
Speaker 3 (12:00):
Automation, yeah, which has made our lives better along the way.
Not to say that there wasn't a cost to those
people losing their jobs, but there were other jobs that
were created in the process, and we had cheaper products
that we should you consumers really liked as well. So
there's a lot of factors that go into this.
Speaker 2 (12:16):
One of the things I think people forget is that trade,
free trade, it increases the buying power of people on
the lower ends of the socioeconomic spectrum a lot, not
a little, a lot.
Speaker 1 (12:27):
So when you're.
Speaker 2 (12:28):
Talking about the sad part, that is people are going
to lose jobs, right, but there are other people, a
larger group of people that are going to benefit quite
a bit by having that ability to buy something that
they want at a very low price.
Speaker 1 (12:39):
I mean, it.
Speaker 2 (12:42):
Sounds like we're not making progress, but it feel like
more people are talking about the debt and deficit, but honestly,
and I hate to say this, vance I don't trust
Republicans to care about it after the election anymore. I
feel like all the grown ups in the room have
left on this issue.
Speaker 1 (12:59):
Am I two pass mystic?
Speaker 3 (13:03):
I don't think so. I'm concerned about it as well.
You know, I'm hoping hopefully they will see the writing
on the wall and say, hey, you know what, we've
got to start doing something different. But we've seen we
I mean, this problem has been around for a long time.
We've had we've had Republicans in Congress where they had
the majority in the House and the Senate and Republican president,
(13:23):
and the deficit continue to go up or at least
running a deficit overall.
Speaker 1 (13:28):
And you know, part of.
Speaker 3 (13:29):
It is is that I you know, one of the
concerns I have with some Republicans is that they'll say, well,
the tax cuts will pay for themselves over.
Speaker 1 (13:36):
Time, and and there's.
Speaker 3 (13:38):
Some truth to that in the sense that I believe
in incentives and.
Speaker 1 (13:40):
That people work more and will get more output and
everything else.
Speaker 3 (13:43):
That's good, But in the short run, there will be
deficits if you continue to spend like drunken sailors, and
that's what they end up doing. And this populism is
really a problem from the new Right to where they
want to give a lot of handouts and spending and
tax cuts.
Speaker 1 (13:58):
Some of them even want to raise taxes.
Speaker 3 (14:00):
And the number one thing you don't want to do
to bring down a deficit is to raise taxes because
then you slow economic growth. Well, we really need is
more economic growth, about a full percentage point more than
what we're having now two and a half percent. Get
it up to three and a half percent, and let's
rain in government spending. If you did that and had
spending growth one percent, we could balance the budget in
eight years. That's too long in my view. I'd love
(14:22):
to see the budget cut.
Speaker 1 (14:23):
We didn't have to cut anything, just slow the growth
and you can have it balanced with eight ears. The
sad thing is Viance.
Speaker 2 (14:28):
You mentioned Rand Paul's sixpenny plan. It was the one
penny plan the first time he put it up. If
they had just passed it, then we would be having
balanced budgets and we'd be working our way through the
national debt, and now it's the sixpenny plan.
Speaker 1 (14:43):
Amen.
Speaker 2 (14:44):
Vance skin is my guest. You can find him advance
skin dot com. I put a link on the blog today.
He has a newsletter, he has a podcast. If you're
a free market type, you should check it out. Vince,
I really appreciate it. Hoping to talk again in the future.
Speaker 1 (14:57):
That was good, Mandy, thank you so much.
Speaker 2 (14:58):
All right, thank you, sir.
Speaker 1 (15:00):
Her
Doctor Van Skin.
Speaker 2 (00:01):
He's an economist and a smart guy, and he's as
annoyed as I am that once again Congress has completely
abdicated their responsibility to pass budget bills and have just
passed another continuing resolution.
Speaker 1 (00:14):
Vance, Welcome to the show. Hi many, it's a pleasure
with you.
Speaker 3 (00:19):
Thank you for having me on, and I am just
as upset about the deficit spending as you.
Speaker 2 (00:24):
Now, what is your background? Give my listeners a little
bit of window of who you are.
Speaker 1 (00:27):
Vance.
Speaker 3 (00:30):
Yeah, so I worked at the Trump White House. I
was the chief economist for the Office of Management and
Budget for about a year from June twenty nineteen and
May of twenty twenty. I've also worked with a lot
of state think tanks and national think tanks across the
country and.
Speaker 1 (00:44):
Do a lot of other work.
Speaker 3 (00:45):
I also have a podcast called Let Fuel Prosper where
I talk a lot about these key important issues about
fiscal budgeting and monetary policy and a whole bunch of
other issues.
Speaker 2 (00:54):
So, Vance, if you were part of the Trump administration,
then I'm gonna ask you a pointed question, because for me,
that was a big area of disappointment, and COVID threw
everything into chaos, So we don't know what would have
happened had his economic policies been allowed to unfold in
a natural way. So I'm going to concede that point.
But spending in the Trump administration, even before COVID was
(01:15):
well beyond what I thought it should have been. Is
there any hope that in another Trump administration we're going
to see And I'm not asking to speak for the
Trump campaign, by the way, I'm not doing that, but
what are your thoughts about the level of seriousness that
debt and deficit spending are seen in that administration?
Speaker 3 (01:35):
Well, I also share your concern about how much was
being spent during the Trump of years. Of course, it
was Congress that spent passes the budgets, but the president
could have vetoed them and done more to do that,
and we were trying to behind the scenes. We were
trying to push it to have lower spending at the
end of the day, and you're right, COVID blew that
out of the water even more with trillions of dollars,
and then Biden administration came in and put that spending
(01:57):
on steroids. So we've run up of another twelve trillion
dollars just so the last four plus years as massive,
and we're spending at trillion dollars just on that interest
payments on the debt alone.
Speaker 1 (02:07):
It's just ridiculous.
Speaker 3 (02:07):
And so one of the things that I'm still concerned about, though,
to your point, Mandy, is that the president hasn't taught
much about the budget. I mean, during that last presidential
debate or even the first one, I don't even think
spending was mentioned at all, or the deficits were mentioned
it at all. And this is a huge concern for
me that I talk a lot about and I know
you do too as well. So this is something we've
(02:28):
got to get control over. And it's both parties. I mean,
this is a bipartisan spending crisis, is the way I
like to put it. That's been happening for decades now,
and we've got to get under control. There are a few,
you know, that are out there that will talk a
good game, and I think are trying to do good things.
Senter Ran Paul had his six penny plan, which would
basically cut six percent over the next few years and
balance the budget, but that was rejected today. At the
(02:51):
same time, they're spending in the cr bill more and
more so, it's a massive spending problem.
Speaker 1 (02:57):
Ran Paul.
Speaker 2 (02:57):
I lived in Kentucky for three years and I'm a
huge and Paul fan, along with Congressman Thomas Massey, who
has been very vocally opposed to the continuing resolutions that
we're seeing.
Speaker 1 (03:07):
Why what I mean, We're.
Speaker 2 (03:09):
Just going to have to get to a debt crisis
situation before anybody in Congress takes so seriously. That's what
I'm afraid of. And what does that look look like
for the American people?
Speaker 3 (03:20):
Well, unfortunately, I think we're seeing a lot of that now.
We saw higher interest rates, right, the interest rates sowar.
That's a big part of what you see during a
debt crisis. We saw inflation soar because the Federal Reserve
printed a lot of that money. I mean their boalance.
You went from four trillion to nine trillion. It's still
seven trillion. It's way too high.
Speaker 1 (03:37):
You know.
Speaker 3 (03:37):
The Federal Reserve cut interest rates by fifty basis points
last week.
Speaker 1 (03:40):
And I think that was a mistake.
Speaker 3 (03:42):
I think we're going to fall into the same traps
we did during the nineteen seventies whenever they cut interest
rates too fast and inflation shot up again. And now
we have even a worse situation because you know, Congress
is overspending more than they were back then, and so
this is going to lead more to increases and ammunition
for the Federal Reserve to print money, increase inflation in
the economy. And so I'm very concerned about a debt crisis.
(04:04):
And the spending crisis is happening now. A lot of
people will blame it on the Trump tax cuts and
other revenue issues, but it's not a revenue problem. This
is clearly a spending problem, and I think what we've
got to do is cut spending today and then restrain
the growth of spending over time. If we do that,
we could find a better path forward, not only for
the spending situation, but for the economy because all this
(04:26):
deficits and debt really matters also to main street and
on the economy because interest rates are soaring and people
can't afford homes and things of that nature. This is
a major problem that's driven by Washington DC.
Speaker 2 (04:38):
I have the video on the blog today by Milton
Friedman from like the late seventies, maybe nineteen eighty. I'm
not sure exactly what the ear is, but he does
this kind of like walk through on inflation, and it's
really at a fifth grade level. I mean, that's why
I put it on the blog. I'm like, if you
have somebody who doesn't understand this, But what it comes
down to, what we're seeing right now and we've seen since,
especially since COVID, is that the Federal Reserve is enabling
(05:01):
the federal government spending by continuing to print money and
buying treasury bonds. So they are if the FED doesn't
keep printing money, then no one's gonna buy those treasury bonds,
and the federal government cannot continue spending, even though.
Speaker 1 (05:15):
The Federal Reserve is supposed to be.
Speaker 2 (05:17):
A non you know, it's supposed to be a non
political entity. So people need to understand that we flooded
the money supply, we flooded the country with money. We
flooded all the markets with money from the FED, and
that's why we are now paying the invisible tax that
is inflation. And too many people do not make that connection.
And it's super frustrating when I hear people say it's
(05:38):
corporate greed, it's you know, it's whatever. And Milton Friedman
actually uses the example of it's not union wages, you know,
because people will blame it on union wages driving those
are a lagging indicator instead of leaking and leading indicator.
So in your in your podcast, what are the kind
of things that you explain when it comes to because
my big thing is this, somebody texts me. We have
(06:00):
a text line and they say things like, you know,
back in the nineteen fifties, we had the highest tax
rates on the one percent and we had prosperity. But
what really happened in the nineteen fifties is the government
contracted all that spending from World War Two and the
economy roared. Why is that lesson lost?
Speaker 1 (06:17):
Yeah? Yeah, it's a great point.
Speaker 3 (06:21):
And Milton Freeman is my favorite economist, so I watch
a lot of his youtubes and I talk a lot
about these things on my podcast like you will prosper
show and try to break it down as simply as possible,
because you're right. I mean, the inflation is an inflation tax.
We all feel it that the crisis that's out there
on spending, we're all feeling it through higher interest rates
today and everything else. And so when people I think
(06:42):
we've lost sight of how good we have it, in
some sense, today, and some people want to go back
to the nineteen fifties or something else. But there's a
lot of things that I think America gets right today.
The problem is in Washington, DC, they don't understand that's
definit spending really matters, and it grows the eyes of government,
which which removes our liberty. The government has no money,
(07:04):
nothing is free, and so they take it from us,
out of the productive private sector, to redistribute it to
someone else. That's all the government spending is. It's not
some candy and sort of logic to where the government
can stimulate the economy and grow in certain areas. No,
what they do is they take it from person A
and give it to person B, and there's no growth
in the economy. In fact, it reduces the economy because
(07:25):
it reduces the productive purposes that are happening before they
tried to redistribute that money. So I think, you know,
Milton Freema is exactly right. Too much money chasing too
few goods is what inflation is. And what we see
in the last especially four years, is a lot of
increasing the money supply driving demand, and then high regulations
at high tax and high spending that have stifled the
(07:46):
supply side of the economy and contributed to massive amount
of inflation. And this is why I think we have
an issue to where whether it's Harris or Trump, right now,
there could be more inflationary pressures because neither one of
them were talking about spending.
Speaker 2 (08:00):
And both of them, you know, I hesitate to call
them dumb ass ideas, but they've piged out some real
dumb ass ideas, both of them. I mean, the Trump
tariff situation is not good for consumers. Harris is trying
to give away more money, but only the people she chooses,
and she, I guess, announced another no interest small business
(08:21):
loan program that if you've never if you've ever dealt
with government loan programs like the SBA, you already.
Speaker 1 (08:27):
Know how cumbersome they are.
Speaker 2 (08:29):
Neither of these people are blazing a trail on economics.
So what does what does an average citizen do? What
do you do if you're worried about this, like I am.
Speaker 3 (08:36):
Yeah, oh man, I've been kind of pulling my hair
out because you know, one day with Trump will talk about, well,
we're gonna exempt taxes on Social Security, then we're going
to exempt taxes on tips and the more that you
narrow the tax base, the higher that the rates are
otherwise going to be, or we're going going to run
massive deficits. Instead, we should have the broadest base possible
with the lowest rates, and hopefully a flat income tax
(08:56):
rate is ultimately what we need, and cut government spending
in the process. But until then, I think, you know,
there's going to be a lot more economic uncertainty. I've
been writing a lot about this at American's for Tax
Reform and American Institute for Economic Research, saying that the
economic concertainty that's being brought forth by both of these campaigns.
Speaker 1 (09:13):
Even though I do think that the Trump campaign.
Speaker 3 (09:15):
Is having a little bit more pro growth policies of
course than the Harris administration, they're both leading to more
economic uncertainty.
Speaker 1 (09:21):
And I'm a free trade guy.
Speaker 3 (09:23):
I debated this a lot with Peter Navarro and others
within the White House. They didn't see it my way,
The presidents didn't see.
Speaker 1 (09:29):
It my way.
Speaker 3 (09:29):
But I really think that free trade is the way
that we will pressure China to change their habits by
putting tariffs on them and everything else. It doesn't change
their ways because they're a communist country.
Speaker 1 (09:40):
They don't care about their people.
Speaker 3 (09:42):
But if you start, if you start changing the dynamics
of other trading partners, now that influences them because that
reduces their power. And I'm hopeful that would be the
way we go. But unfortunately we're talking about tariffs all
the time.
Speaker 1 (09:53):
Well.
Speaker 2 (09:53):
I do think that in some ways Trump has a
very sort of nineteen fifties view of American manufacturing, right,
and I genuinely think he believes we can be the
leader in the world in manufacturing. But the reality is
is that our standard of living is very high now, right,
And that's good, that's great that we have a high
standard of living. So it makes it very difficult, difficult
(10:15):
to compete with places that don't, like China, like Mexico,
like developing economies where they can make things much cheaper
than they can make them here because they pay people
forty bucks a month.
Speaker 1 (10:27):
So I mean, how is there a way? Though?
Speaker 2 (10:30):
I mean, this is something that I think is something
that needs to be addressed, and that is, how do
you ensure that the United States in an emergency situation
can get things done?
Speaker 1 (10:41):
How do we build new aircraft carriers?
Speaker 2 (10:43):
How do we make steal how do we protect those
things that protect our ability to defend ourselves.
Speaker 1 (10:49):
This is totally off the beaten track.
Speaker 2 (10:51):
I don't know if I'm asking you stuff outside your
wheelhouse here.
Speaker 1 (10:53):
No, No, it's fine, it's fine.
Speaker 3 (10:56):
These are all national security type threats, right, and that
I think are legitimate concerns that should be addressed.
Speaker 1 (11:02):
And one of the things that I like to point out.
Speaker 3 (11:04):
Is that when we point our fingers at someone else
like China, we've got three more fingers pointing back at ourselves.
Speaker 1 (11:10):
There's more that we should be doing in America.
Speaker 3 (11:12):
To reduce the cost of business instead of just blaming
other countries, like reducing the corporate income tax rate, which
Trump has talked about reducing it to fifteen percent. I
would like for it to be zero percent, because businesses
don't play pay taxes. People do through the form of
higher prices, lower wages, and fewer jobs. We also should
be reducing regulations. There's a lot of hoops that we've
(11:32):
got to jump jump through in order to get stilled
to the market. There's a lot of jump hoops that
we're going to jump through to get food to the market,
and so much more that if we remove those obstacles,
we ma to be much more competitive and wouldn't have
to blame other countries. And one thing I like to
note too about manufacturing is that where we're reaching manufacturing
highs and output, it's just that the employment has declined
(11:54):
over time. And that's not just because of China and
other countries through trade.
Speaker 1 (11:59):
A lot of it was through.
Speaker 3 (12:00):
Automation, yeah, which has made our lives better along the way.
Not to say that there wasn't a cost to those
people losing their jobs, but there were other jobs that
were created in the process, and we had cheaper products
that we should you consumers really liked as well. So
there's a lot of factors that go into this.
Speaker 2 (12:16):
One of the things I think people forget is that trade,
free trade, it increases the buying power of people on
the lower ends of the socioeconomic spectrum a lot, not
a little, a lot.
Speaker 1 (12:27):
So when you're.
Speaker 2 (12:28):
Talking about the sad part, that is people are going
to lose jobs, right, but there are other people, a
larger group of people that are going to benefit quite
a bit by having that ability to buy something that
they want at a very low price.
Speaker 1 (12:39):
I mean, it.
Speaker 2 (12:42):
Sounds like we're not making progress, but it feel like
more people are talking about the debt and deficit, but honestly,
and I hate to say this, vance I don't trust
Republicans to care about it after the election anymore. I
feel like all the grown ups in the room have
left on this issue.
Speaker 1 (12:59):
Am I two pass mystic?
Speaker 3 (13:03):
I don't think so. I'm concerned about it as well.
You know, I'm hoping hopefully they will see the writing
on the wall and say, hey, you know what, we've
got to start doing something different. But we've seen we
I mean, this problem has been around for a long time.
We've had we've had Republicans in Congress where they had
the majority in the House and the Senate and Republican president,
(13:23):
and the deficit continue to go up or at least
running a deficit overall.
Speaker 1 (13:28):
And you know, part of.
Speaker 3 (13:29):
It is is that I you know, one of the
concerns I have with some Republicans is that they'll say, well,
the tax cuts will pay for themselves over.
Speaker 1 (13:36):
Time, and and there's.
Speaker 3 (13:38):
Some truth to that in the sense that I believe
in incentives and.
Speaker 1 (13:40):
That people work more and will get more output and
everything else.
Speaker 3 (13:43):
That's good, But in the short run, there will be
deficits if you continue to spend like drunken sailors, and
that's what they end up doing. And this populism is
really a problem from the new Right to where they
want to give a lot of handouts and spending and
tax cuts.
Speaker 1 (13:58):
Some of them even want to raise taxes.
Speaker 3 (14:00):
And the number one thing you don't want to do
to bring down a deficit is to raise taxes because
then you slow economic growth. Well, we really need is
more economic growth, about a full percentage point more than
what we're having now two and a half percent. Get
it up to three and a half percent, and let's
rain in government spending. If you did that and had
spending growth one percent, we could balance the budget in
eight years. That's too long in my view. I'd love
(14:22):
to see the budget cut.
Speaker 1 (14:23):
We didn't have to cut anything, just slow the growth
and you can have it balanced with eight ears. The
sad thing is Viance.
Speaker 2 (14:28):
You mentioned Rand Paul's sixpenny plan. It was the one
penny plan the first time he put it up. If
they had just passed it, then we would be having
balanced budgets and we'd be working our way through the
national debt, and now it's the sixpenny plan.
Speaker 1 (14:43):
Amen.
Speaker 2 (14:44):
Vance skin is my guest. You can find him advance
skin dot com. I put a link on the blog today.
He has a newsletter, he has a podcast. If you're
a free market type, you should check it out. Vince,
I really appreciate it. Hoping to talk again in the future.
Speaker 1 (14:57):
That was good, Mandy, thank you so much.
Speaker 2 (14:58):
All right, thank you, sir.
Speaker 1 (15:00):
Her
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