RUSH: Donald Trump appeared with Maria Bartiromo on the Fox Business Network today. We have some sound bites of this. And what is interesting is that he goes into detail here about his agenda, how he’s going to get it through, how he’s going to get it passed, what he hopes to accomplish, how he’s working with Congress.
And it flies in the face of the standard day-to-day reporting that the administration’s flying blind. That it’s aimless and there’s nobody there that knows how to get anything done. They can’t work with Congress and Trump really doesn’t know what he’s doing because he’s an outsider and he’s huffing and puffing and using a lot of bluster, but it’s all fake and smoke and mirrors. And this contradicts that. Let’s just get started here with the first bite. There’s no question because we’re just picking this up in mid-answer.
THE PRESIDENT: We’re going to have tax reform at some point very soon. I think we’re doing very well on health care. It’s been very much misreported that we failed with health care. We haven’t failed. We’re negotiating and we continue to negotiate. And we will save perhaps $900 billion. You know, if you look at the kind of numbers that we’re talking about, that’s all going back into the taxes. And we have to do health care first to pick up additional money so that we get great tax reform. So we’re going to have a phenomenal tax reform, but I have to do health care first. I want to do it first to really do it right. Health care has been going along — you know, it’s in negotiation, it’s what I do, and it’s a negotiation, and after that we’re gonna start on tax reform and infrastructure.
RUSH: So everything’s still on schedule, everything’s still happening as I intended it to happen, this is what I do, I negotiate. Nothing’s been stopped yet, nothing’s failed, we’re still going after this. He’s optimistic and very purposeful here, very committed. The one thing about this that bothers me, and it bothers me when anybody in Washington says, “Yeah, we gotta do health care first to come up with the money for tax cuts.” No, you don’t!
You know, this is all predicated on the assumption that Washington can never spend less this year than it did last year. And it cannot spend less next year than it did this year. And so if we’re gonna have a tax cut — you know what the problem with this is, folks? The beloved Congressional Budget Office.
Here’s how the Congressional Budget Office works. If the Republicans submit a tax cut that is equal for the federal deficit, let’s say they have a tax cut of $500 billion. The CBO would score that as though the government is going to lose $500 billion this year and next year and the year after that and the year after that and thereby kill any possibility of doing that tax cut, because they don’t score anything dynamically. And it’s even worse than that. If you’re going to cut taxes by $500 billion, and I’m just choosing random numbers for the sake of discussion.
When you cut taxes, federal income taxes by $500 billion, what happens? Five hundred billion stays in the economy and does not go to Washington. What happens to it when it goes to Washington? Well, it doesn’t create any jobs. And it doesn’t produce anything. And it doesn’t innovative producing anything. There aren’t any new products. There aren’t any new services. All that happens is the welfare state gets bigger. If you take $500 billion and let people who’ve earned it keep it, what do they do with it? Even if they save it, it’s still in circulation in the economy.
If they spend it, then it’s helping whatever product or service they’re buying. If they’re a small business, they might hire a couple new employees. They might buy a new plant, machine, factory, whatever. It’s economic activity. The more money you keep in the private sector, the more economic activity there is, the more economic growth there is. And the more of that there is, the more hiring goes on, and the more people you hire, the more people you have paying taxes. So that $500 billion-dollar tax cut does not result in the government losing $500 billion. It could end up with them earning a heck of a lot more.
The CBO doesn’t score it. The CBO scores it as a net loss, and that panics legislation, “Oh, my God, $500 billion. So we gotta find a way to make that up.” That’s what Trump is falling for, that’s what he’s saying (imitating Trump), “Well, you know, we can’t do tax cuts ’til we come up with the money for it by saving money from health care.” See, in my naive world you could do both at the same time. And if Washington has to do with a little less, then so be it. Everybody else has to do that. What’s so sacrosanct about the government never having to do with less while forcing millions of Americans to do with less every year because of tax policy and any number of other fees and expenses they tack on to people.
So the savings from Obamacare will give us great tax reform. But, you know, you could do tax reform first, if you do it right, you could actually dynamically project, based on history, you could look at the Reagan tax cuts and find out what happened. And let me remind you, when Reagan took office in 1981, the top marginal tax rate was 70%.
Now, nobody paid it, but it was there. It was on the books. There were a lot of deductions too. And so you could avoid paying 70% on a certain portion of your income if you invested in the tax shelters of the day which the government wanted to promote. That’s what shelters and deductions are. The government deciding they’re gonna promote charitable donation or buying a home, so you get to deduct the interest on your mortgage or whatever.
So Reagan takes office. These are hard, cold facts. Takes office 1981, top marginal rate, 70%. Back in ’81, the money generated by the tax code to the Treasury was about $500 billion. It sounds tiny today, 40 years ago, but it was huge at the time. So taking the top tax rate with 70%, the money generated, $500 billion. When Reagan left office eight years later, the top marginal rate was 28%, and the amount of money generated by the tax code had doubled to nearly a trillion dollars.
So Reagan, in shorthand, cut taxes from 70% to 28% and doubled the amount of revenue government collected. How did it happen? Well, the tax cuts led to massive employment, economic activity, more taxpayers earning more money, paying more taxes. And even with Reagan’s tax reform, the rich were paying the lion’s share of income taxes, even though Reagan’s tax cuts were maligned and improperly stated as tax cuts for the rich. But everybody benefited.
The point is that all of this money via tax cuts that remained in the economy, which is where true innovation happens, which is where hiring happens, which is where productivity happens, which is where manufacturing happens, which is where services are, the more money there, the greater the economic activity, the greater the benefit for everybody in it as opposed to that money going to Washington and then doing whatever they do with it. Same thing here.
So you could look, if you wanted to score what a $500 billion tax cut would do, go back and look at the Reagan years and take a look at what happened and then make some very loose projections about what a similar tax cut today would do in terms of growing revenue. Do you know what this illustrated, this massive tax rate reduction from 70% to 28% and doubling the amount of revenue collected? It demonstrated that the left is really not interested in money to run the government. That’s not what the tax code is to them.
Now, to you and I, the tax code is to provide revenue for the government to perform its basic constitutional services and requirements. To the left, the tax code is punishment. The tax code is how they get even with their enemies. The tax code is how they go out and maximize and implement what their political strategies are, like taxing the rich, benefiting the poor, and all this. And they will admit that it just is not right that a rich guy is paying 28% and a middle class guy is paying 15%, it’s not right, it’s not fair.
Then you say to them, “But look at the money generated to the government?” And they say, “It’s not that. It’s the percentages. They’re not fair.” So they’re not interested in revenue generated to the government. Why would they be? They deficit spend, as the Republicans do. Why even worry about how much money’s generated when you look at the national debt. Our spending is in relationship zero to how much we take in. Why don’t they just eliminate taxes? It doesn’t matter. They’re gonna spend the money whether they have it or not anyway, so why not let us keep everything we earn?
That’s how I look at it. I mean, if the tax code raises $2 trillion a year and they spend three, what the hell. It doesn’t matter how much they raise; they’re gonna blow through it anyway. So don’t tax us at all! Still spend the money, just add it to the national debt, nobody ever has to pay it back, and, voila, we live in utopia. So it’s a long way around saying I understand what the president’s saying here, but I disagree that you have to do health care first in order to find the money to do tax cuts.
That’s not what you have to do. You have to commit to the government doing with a little less. You have to commit to the idea that government’s got much more than it needs. That it’s spending much more than it has to because they’re redundant programs left and right, same programs spending three times on the same projects, same people. The solution here is the government getting smaller. But that’s never on the table. And somebody needs to put it there.
RUSH: Couple more Trump sound bites here. This, again, from Maria Bartiromo on the Fox Business Network. Mornings with Maria is the name of the program. She says, “Did you have to do health care before tax reform? When I speak with business managers, they say tax reform is much more impactful.”
THE PRESIDENT: They’re all right. But because I’m saving a tremendous amount… Hundreds and hundreds of millions of dollars we’re saving on health care. So we’re gonna have a much better plan than Obamacare, which is failing. Even now, as I came in here, they’re saying payments have to be made that weren’t scheduled to be made on Obamacare. If you don’t make ’em, it fails. You know, it’s just a mess. Obamacare is a total mess. So we’re saving tremendous amounts of money on health care when we get this done, number one. And most importantly, actually, we’re gonna have great health care. And all of that saving goes into the tax. If you don’t do that, you can’t put any of the savings into the tax cuts and the tax reform.
RUSH: Now, look, it’s basically a repeat of the first bite we played, and the premise is, “I can’t do tax reform unless I have the money to cut taxes that I’ll get from reforming Obamacare — repealing it and reforming it.” Now, I understand that this could be the way the president is trying to light a fire under Congress. And make no mistake: The president faces opposition from the professional political class in Washington. They don’t want him to succeed.
I interviewed Louie Gohmert, who is a member of the House in Texas, yesterday after the program, for the upgrade Limbaugh Letter (the most widely read political newsletter across the fruited plain) and I got Louie to admit that there are Republicans in the Washington establishment who are not crazy about Trump succeeding. He didn’t name names, and he didn’t say it’s a lot of them. It’s all of the Democrats. But the point is it’s not so much Republican versus Democrat in this circumstance; it’s establishment versus outsider.
And there’s one thing that was present during the campaign that hasn’t changed, and that is the idea that, “We’re the experts. We establishmentarians. We’re the experts. We know how this works. We know how to get things done. You can’t just walk in here and be an expert in how things happen here. You have to pay your dues. Just like you can’t walk into the New York Yankee locker room and expect to be a starting pitcher if you’ve never played the game before, well, it’s the same thing here in the establishment.”
And they can’t afford for Trump to succeed, unless it looks like he needed them to do it. And he knows this. He’s got to find a way around them. It’s much of what his interview today was about, actually, although not naming opposition in his own party based on establishment. But it’s all part of the mix. So he may well fully understand that he doesn’t need to cut Obamacare first in order to have money for a tax cut. But he may be using their language as a means of communicating with them in order to force something on health care, because that is an objective.
That’s as big a campaign promise as tax reform was. And saying to them… You know, establishment language is (stammering), “Well, we — we — we can’t cut taxes ’til we find somewhere to make up the difference!” So Trump, speaking their language, is saying, “Exactly right. So we need to reform-replace Obamacare to come up with the money for the tax cut.” That’s language they understand. I hope that’s what he’s doing. Because, folks, as far as you and I are concerned, we don’t need to come up with replacement money for a tax cut. The tax cut is gonna create more money. The tax cut is gonna generate all kinds of new revenue by creating new jobs, which creates new taxpayers.
The next bite, again, doesn’t come from a question because we’re taking it in progress…
THE PRESIDENT: Health care’s gonna happen at some point. Now, if it doesn’t happen fast enough, I’ll start the taxes. But the tax reform and the tax cuts are better if I can do health care first.
BARTIROMO: What about infrastructure?
THE PRESIDENT: A hundred percent.
BARTIROMO: How do you see it? When do you see it?
THE PRESIDENT: Very soon. I see it as part, perhaps, of the health care plan, because phase 2 of the health care plan, in order to get the votes, I need 60% for that. And if I put that in, the Democrats are actually going to love the infrastructure plan. So we’re gonna actually, I believe, despite their tremendous hostility for years! This isn’t just for Trump. This is for years, it’s been so hostile. The level of hatred is incredible, and I’m not just saying in the last 90 days. I’m saying this has been for the last few years.
RUSH: Bingo. Exactly right. And the hatred extends to not letting him succeed. The hatred extends to the point of having him fail. They can’t have some outsider come in here and run rings around them. They can’t have somebody like Trump come in here and demonstrate how you can get things done rather quickly after years and years of the experts telling us, “Well, you just don’t understand. You know, we need the House, and then we don’t have that. We need the Senate; we don’t have the Senate. We need the White House, so we…”
All that rigmarole. And he comes in and he starts moving at a… I mean, he’s at roadrunner pace here already, and they aren’t used to it. So he’s right about the hatred. This infrastructure? I have to tell, I’m fascinated by this whole concept of public-private partnership. I can see… I’m not saying this is gonna happen. I’ll give you an example. The wall. I heard… You know, we heard yesterday that the Trump budget, there’s not gonna be any money appropriated for the wall. They’re just gonna stiff Trump. There’s not gonna be any wall. Omnibus budget, regular budget, will get gonna be any.
Well, I’m here to tell you, the wall’s gonna get built. They’re already taking bids. Companies are already submitting designs, and if you look at maybe a public-private partnership on the wall? Okay, so you build a wall and you put observation decks up there or you put hot tubs or suites or maybe overnight accommodations. You make the wall a tourist attraction, where people can come stay overnight and watch the Border Patrol keep ’em out (laughing) or whatever happens there. Can you just see the Marriott Border Wall Suites Hotel?
Or, better yet: The Ritz-Carlton Border Protection Wall Five-Star Hotel with a series of suites all along the top of the wall, whatever. I don’t know. Just an example here. But public-private partnership on infrastructure repair? There’s no question we need it. And I can see infrastructure being coupled with tax cuts to generate economic growth and have some of the growth result from the modernization of airports and roads. I know this is how he’s thinking. Actually, he’s not said that to me, but I just know that’s how he’s thinking and getting “private” as in corporate participation.
Hell, folks, you know that there are rich guys that will build entire wings to a hospital if you let ’em put their name on it. You know, the Anastas Mikoyan Cancer Research Center at Sloan Kettering Satellite Cancer Service in LaGuardia. Whatever. People will pay as long as they can get their name on it for posterity like Alice Tully Hall at Lincoln Center. Who’s Alice Tully? I don’t know. But now everybody knows the name. They made a concert hall there; they put her name on it somehow.
There are any number of ways you can get money from the private sector to participate in some of these projects where there may not be enough federal money for it, and these are the kinds of things that establishmentarians would never dream of doing. Particularly people like Obama who’ve never worked in the private sector and therefore have, you know, very much resentment/distrust of it in the first place.