WASHINGTON — Treasury Secretary Scott Bessent told Breitbart News that President Donald Trump intends to bring “certainty” to the U.S. economy with tax relief and deregulation efforts.
Trump’s first term 2017 tax cuts — the Tax Cuts and Jobs Act (TCJA) — are set to expire at the end of this year, but Bessent is confident Congress will permanently extend the current tax rates. In addition, Bessent is also confident that Congress will succeed in enacting Trump’s additional promises of no tax on tips, no tax on overtime wages, and no tax on Social Security income. Bessent opened this part of the nearly 40-minute-long on-camera long-form interview by ripping the Congressional Budget Office (CBO) for unsound analysis when it comes to tax rates and growth.
“For your viewers I want to make one thing clear too. We say that the tax cuts are extended, that for 35 years in my investment career I talked about CBO scoring and I never really understood the way it worked,” Bessent said. “Now that I’m on this side of the wall, it’s the craziest accounting you’ve ever seen. So, the tax cuts expire, but the spending that gets put through never expires? So we are seeing that we are extending the tax cuts when it reality it’s what we’ve had. On the spending, no one says, ‘oh you have to re-up the spending.’ That’s how we got into this mess. So, this is why we want to make — I’ll call it the current tax rates rather than the tax cuts — we want to make the current tax rates permanent and give Americans, small business, big business, American households certainty on what their tax rates are going to be. I think that that’s very powerful and will have a great stimulus effect.”
Beyond extending the current tax rates permanently, getting the other parts of Trump’s tax policy — no tax on tips, overtime, or Social Security wages — is how Bessent said Trump will further address the “affordability crisis” facing the nation.
“That’s part of the president’s solution to the affordability crisis because now that inflation has slowed, prices are still at a high absolute level,” Bessent said when Breitbart News asked. “There are three ways to cure that. One is through real wage growth, which we’re going to do through bringing back manufacturers and high-paying jobs, two is through getting prices down, and three through getting tax cuts for working class Americans. If you think about it, no tax on tips, no tax on Social Security, no tax on overtime, and perhaps deductibility for auto loans, that’s all for the bottom 50 percent of wage earners who have gotten killed in Joe Biden’s America. So President Trump believes he won on the affordability crisis and on immigration. He’s going to solve both of them, but this is all addressing the affordability crisis and giving economic relief and economic security to working Americans.”
No billionaires are collecting tips or overtime wages, yet Democrats in Congress keep whining about billionaires supposedly being helped by Trump’s policies over the very working class Americans Trump’s policies would help. Asked about this criticism, Bessent laughed it off then pointed to GOP unity since the inauguration.
“They got no game right now,” Bessent said of Democrats. “They’re flailing. I think one of the underreported stories since Jan. 20 is the Republican unity. President Trump has obviously been on a roll with policy and with executive orders, and the Democrats don’t know how to stop him, but the Republican Party writ large has been very unified.”
Asked about whether CBO will reform its ways moving forward, Bessent said that seems unlikely — hence why he and Trump are seeking other ways to communicate with the American public like in this interview and his speech to the New York Economic Club.
“I don’t know if the CBO is going to change their ways, but when I can do interviews like this and speeches like at the Economic Club of New York and editorials, then I can educate the American people about what’s really going on there with this CBO modeling,” Bessent said. “Again, I was an investment professional for 35 years. I believed it. But now, when you look under the hood, you see everything is on a ten-year projection. Economic growth is projected to be 1.7 or 1.8 percent steady state no matter what happens. So if there’s no tax bill and we have the biggest tax increase in history, CBO is going to say the economy still grows at 1.7 or 1.8 percent. If we make the tax rates permanent, and get the new tax cuts in, they’re not going to score additional growth. So I think they were about a billion and a half off in their last estimate of TCJA, and we’ll see how they do this time. I would say in my investment career, if we were running an investment program that continued to lose money, we would stop running it. But it’s the government, so who knows.”
Bessent also explained several banking regulations he wants to see reined in moving forward. He said the overarching vision policy-wise from the Trump Treasury Department is going to be on making loans available to more Americans and businesses beyond the elites. That said, he also thinks this needs to be done safely and carefully to ensure no blowback or repercussions on the economic system.
“In general, the banking system has three regulators: The Fed, the OCC, and the FDIC and then to some extent the CFPB got in on the act. I study financial history and I can tell you that when you see the regulated banking system not able to make loans, then that is how Main Street atrophies,” Bessent said. “The strength of the U.S. is the depth and breadth of our financial system. We are cutting off the depth so only the high-end borrowers [get loans]. There is a lot we can do with regulation in terms of bank supervision, the supervisors have a lot of discretion, there are rules being pressed on small and community banks in terms of asset diversification and geographical diversification. They don’t have geographical diversification. They might serve one small town with five branches. So there is a lot we can do with that. With the big banks, they are hung up and capital-constrained. They are forced to hold reserves against the safest assets, government bonds, I actually think if we get rid of this thing called the SLR, we could bring down interest rates and banks would be willing to hold more bonds because they don’t have to have this big capital charge. Again, I’ve studied the history of this, and I’m not saying let ‘er rip. What I’m saying is safe, sound, and secure banking and make it so the regulated banking system is helping American business and the people.”
More from Bessent’s latest Breitbart News interview is forthcoming.
