The Daily Signal - #511: Just How Bad Is the Spending Deal?

Episode Date: July 24, 2019

Congress is staring at a massive spending deal reached by President Donald Trump and House Speaker Nancy Pelosi—one that's left fiscal conservatives deeply concerned. Today, we unpack the details and discuss how the bill matches up with spending levels under President Barack Obama. We're joined by Heritage budget expert Justin Bogie. Plus: Rep. Rashida Tlaib, D-Mich., defends boycotting Israel on the House floor.We also cover these stories:-The White House is bullish following Robert Mueller's lackluster performance before Congress.-A new poll finds Democrats increasingly think the Mueller probe wasn't conducted fairly.-A senior software engineer at Google blows the whistle on tech bias.The Daily Signal podcast is available on Ricochet, iTunes, SoundCloud, Google Play, and Stitcher. All of our podcasts can be found at DailySignal.com/podcasts. If you like what you hear, please leave a review. You can also leave us a message at 202-608-6205 or write us at [e-mail]. Enjoy the show! Hosted on Acast. See acast.com/privacy for more information. Learn more about your ad choices. Visit megaphone.fm/adchoices

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I'm Rachel Judith. And I'm Daniel Davis. Congress is staring at a massive spending bill reached by President Trump and House Speaker Nancy Pelosi and its left fiscal conservatives deeply concerned. Today we'll unpack the details and discuss how the bill matches up with spending levels under President Obama. We'll be joined by Heritage Budget expert, Justin Bogi. Plus, Congresswoman Rashida Tlaib defends boycotting Israel from the House floor. By the way, if you're enjoying this podcast, please consider leaving a review or a five-star rating on iTunes and encourage others to subscribe.

Now on to our top news. Well, optimism was running high at the White House Wednesday after Special Counsel Robert Mueller's highly anticipated appearance before Congress turned out to be, well, lackluster. Politico reports that White House aides were quietly celebrating as Mueller appeared dishevelled and at times confused, often asking lawmakers to repeat their questions. questions. Halfway through the hearing, White House Press Secretary Stephanie Grisham said in a statement, quote, the last three hours have been an epic embarrassment for the Democrats. Expect more of the same in the second half, end quote. There were poignant moments throughout the hearing, with Mueller pushing back on the president's claim that he had cleared him of obstruction of justice. Here's one exchange between Mueller and chairman, Jerry Nadler.

Director Mueller, the president has repeatedly claimed that your report found there was no obstruction and that it completely and totally exonerated him. But that is not what your report said, is it? Correct. That is not what the report said. Now reading from page two of volume two of your report that's on the screen, you wrote, quote, if we had confidence after a thorough investigation of the facts that the president clearly did not commit obstruction of justice, we would so state. Based on the facts and the applicable legal standards, however, We are unable to reach that judgment, close quote.

Now, does that say there was no obstruction? No. In fact, you were actually unable to conclude the president did not commit obstruction of justice. Is that correct? Well, we, at the outset, determined that we, when it came to the president's culpability, we needed to go forward only after,

taking to account the OLC opinion that indicated that a president, sitting president, cannot be indicted. So the report did not conclude that he did not commit obstruction of justice? Is that correct? That is correct. And what about total exoneration? Did you actually totally exonerate the president? No. Now, in fact, your reports expressly states that it does not exonerate the president. It does. Well, at times, Mueller, appeared unfamiliar with his own report and unfamiliar with Fusion GPS, the firm that produced the steel dossier, which became the basis for the FBI investigation into the Trump campaign. On page 103 of volume 2 of your report, when discussing the June 2016 Trump Tower meeting,

you referenced, quote, the firm that produced steel reporting, unquote. The name of that firm was Fusion GPS. Is that correct? And you're on page 103? 103, that's correct, volume 2. When you talk about the firm that produced the steel reporting, the name of the firm that produced that was Fusion GPS. Is that correct? I'm not familiar with that.

It was. It's not a trick question, right? It was Fusion GPS. Now, Fusion GPS produced the opposition research document, widely known as the steel dossier. And the owner of Fusion GPA was someone named Glenn Simpson. Are you familiar with? This is outside my purview.

Okay. The president later tweeted, Truth is a force of nature. And, quote, I would like to thank the Democrats for holding this morning's hearing. Now, after three hours, Robert Mueller has to subject himself to hashtag shifty shift, an embarrassment to our country. Special counsel, Robert Mueller, also gave special emphasis to the threat posed by Russian interference in the U.S. elections.

Here's what he had to say. Let me say one more thing. Over the course of my career, I have seen a number of challenges to our democracy. The Russian government's effort to interfere in our election is among the most serious. As I said on May 29th, this deserves the attention of the United States. of every American. Thank you, Mr. Chairman. Well, at just the time when some Democrats are pushing to impeach the president,

the new poll shows that Democrats nationwide are increasingly skeptical about the fairness of the Mueller investigation. The survey conducted by Politico and Morning Consult found that Democrats who believe the probe was conducted unfairly shot up by 15 percentage points since April. Now, in July, 42% of Democrats and 42% of Republicans, believe the Mueller probe was conducted unfairly. Overall, 42% of voters said it was conducted not too fairly or not fairly at all compared to 37% of voters who said it was conducted

very or somewhat fairly. And report published Wednesday by undercover media organization Project Feritas, Greg Coppola, a senior software engineer at Google who works on artificial intelligence and the Google assistant, said he thinks it's impossible for big tech companies like Google to be unbiased arbiters of information. Overall, I'm very concerned to see big tech and the big media merge basically with the political party, with the Democrat Party. I have a PhD. I have five years of experience at Google, and I just know how algorithms are.

They don't write themselves. We write them to do what we want them to do. I look at search and I look at Google News and I see what it's doing. and I see Google executives go to Congress and say that it's not manipulated, it's not political, and I'm just so sure that's not true. I think as the election started to ramp up, the angle that the Democrats and the media took was that anyone who liked Donald Trump was a racist, even a Nazi, and that got picked up everywhere. Well, I think...

He also said that today's technology is, quote, taking sides. I think for a while we had tech that was politically neutral. Now we have tech that really, first of all, is taking sides in a political contest, which I think, you know, anytime you have big corporate power merging with political parties can be dangerous. And I think more generally we have to just decide now that we kind of are seeing tech. use its power to manipulate people, it's a time to decide, you know, do we run the technology? Does the technology run us? Well, the Justice Department has opened up an antitrust review into the nation's biggest tech companies. The Washington Examiner reports, quote, the probe will examine how the

platforms have gained market power and whether they're engaging in practices that stifle competition or hurt consumers in violation of federal law. The antitrust review, the Justice Department said, We'll consider the widespread concerns that consumers, businesses, and entrepreneurs have expressed about search, social media, and some retail services online, end quote. The Justice Department said it would seek redress if it finds any market-leading online platforms have violated antitrust laws. Senators voted 97 to 2 on Tuesday to fund first responders of the 9-11 terrorist attacks. John Feele, who was a first responder and who advocated for the legislation, thanked those who voted and supported the bill during a news conference, saying, quote, I'm going to ask my team now to put down your swords and pick up your rakes and go home,

and hopefully we don't have to come back. End quote. The legislation funds the 9-11 compensation fund through 2092. Senator Rand Paul of Kentucky, who voted against the legislation with his colleague, Senator Mike Lee of Utah, said, quote, While I support our heroic first responders, I can't in good conscience vote for legislation, which to my dismay remains unfunded. Well, up next we'll take a look at the big budget deal with Heritage Budget Expert Justin Boki. Tired of high taxes, fewer health care choices, and bigger government, become a part of the Heritage Foundation.

We're fighting the rising tide of homegrown socialism while developing conservative solutions that make families more free and more problems. Find out more at heritage.org. Well, Congress is looking at a massive new budget deal, one that has left conservatives a bit dismayed. Joining us now to unpack the deal is Justin Bogie. He's a senior policy analyst in fiscal affairs here at the Heritage Foundation. Justin, thanks for being back on. It's good to be with you. It seems like the only time I'm ever here is under bad circumstances, but it's good to be with you nonetheless.

Yeah, it's unfortunate. You know, this week the Trump administration came out in support of this. this budget deal with Speaker Nancy Pelosi, and it would suspend the budget caps for two whole years while raising spending considerably. What's your big picture take on this? Right. So you're exactly right. This is another Budget Control Act cap deal. We've had the Budget Control Act in place since 2011 set caps on discretionary spending. And this is now the fourth deal to raise those caps. This one raises them by $322 billion over two years. That's the base funding. There's some other things like war funding thrown into that, but that's the base.

And then it also suspends the debt limit for two years, basically meaning that the federal government can borrow as much as it wants to through July 31st, 2021, with nothing to restrict them. So just a lot of additional deficit spending and additional debt that's going to be added on for taxpayers. So, Justin, this deal is quite different from the president's budget proposal, which would have raised defense spending while considerably rolling back domestic spending. What are some of those major concessions you find most concerning? Well, yeah, there's really not much good coming out of this deal if you care about the national debt, if you care about the budget. The president's put forth three budgets now. The first one balanced. The other two

still significantly cut the size of the federal government. They didn't balance, but they did make some progress. Even on the defense side, this really isn't a move in the right direction. The 2020 figure is pretty good, but they're only getting a 0.3 percent increase. in 2021. So really, it's not even keeping up with inflation for national defense. And our team here certainly thinks that's unacceptable. And then, you know, another $150 billion or so in domestic spending, we feel like a lot of those programs shouldn't be in the federal government's purview in the first place. They would be better run by state and local governments, the private sector. So really, everyone's getting an increase under this bill, and it's touching a lot of things

that really we shouldn't be in the business of doing anyways. So conservatives were up in arms about big spending deals under President Obama, you know, big spending, especially those first couple years in office. How does this spending bill match up with what we saw under Obama? Yeah, so this is really worse, honestly. And President Trump's been very critical of President Obama, President Bush before him, and some of the decisions that they made. But in terms of these spending bills, this is much worse. Now, if the president signs this bill, his two budget cap deals will have been over $600 billion. Obama's two combined were. only about $145 billion or so. And obviously there was some other spending under President Obama.

You had the stimulus package after the recession that added on to his debt figures. But as good as some of the policies that President Trump has put forward have been, there has to be followed through. And this budget deal is just the complete opposite of that. It's basically caving to all these demands. And of course, the big contextual difference is that now we've got a roaring economy, which should at least be a good time to pull back on the spending, right? Exactly. Typically, when the economy is going well, you'd be paying down the national debt and deficits would be lower. And we're saying the exact opposite of that. So that's particularly concerning. And a lot of it can be chalked up to the lack of a budget process.

And I saw something really interesting this afternoon from Leon Panetta, who obviously was a Democrat, but chairman of the House Budget Committee back in the 80s, I believe. He had a really good point. This isn't everyone's praising this or people who are supportive of this or praising it as a great bipartisan breakthrough. And he said it's really not a bipartisan breakthrough. It's just a continuation of budget dysfunction. So we're all really going to be the losers in this. It's just more of the same.

So this budget deal, it doesn't raise the debt limit. It doesn't just do that. It also suspends it. Can you talk about the difference there and why that difference matters? Sure. So if you want to raise the debt limit in a fiscally responsible way, And I don't think anyone wants to flirt with defaulting. That would have a bad impact on the economy, the stock market.

But the right way to raise the debt limit is to raise it to an actual value, a number certain, and have corresponding spending cuts to accommodate that additional debt. That's what we saw in 2011. That's how the Budget Control Act came to be. It was in return for a $2.1 trillion increase in the debt limit. We saw corresponding spending cuts. But when you suspend the debt limit, that basically just means it doesn't exist. So there's nothing to stop Congress from borrowing as much as it wants to, the federal government spending as much as it wants to.

So you mentioned 2011. Right after the Tea Party wave, Congress passed the Budget Control Act to finally get a grip on spending. Is that Act now basically in tatters? It is. For all practical purposes, it's dead. The caps only run through 2021. There's a mandatory component that's now been extended through 202. that will be extended through 2029 if this bill passes.

But that only saves about $60 billion or so in the last couple of years. So basically the caps are gone. And what happens after 2021 is anyone's guess. It's not a very comforting future. Well, you'd have a piece, Justin, the Daily Signal, on this this morning. And you wrote that quote, We could soon all pay a heavy price for this irresponsibility. Can you expand on that a little bit?

What kind of price could we end up paying if we continue? down this path? Sure. And first I would say that in order to avoid a bad outcome, we should be making reforms now. And what this bill does is it spends now and it doesn't even pay for it later. So it's just a continuation of delaying reforms and pushing it further down the road. But there's a lot of data out there that shows when a country's debt gets over 90% of GDP, which we already are over in terms of gross debt at least, and we're getting close to it and debt held by the public, that economic productivity slows down. on it, growth slows down, and that translates into less take-home pay for every one of us.

It could also mean that we see inflation creep up, that we see interest rates rise. So basically, everything that we buy becomes more expensive, and in general, we won't have as good of a quality of life. And that's especially true, the longer we delay reforms for future generations. They're going to be paying a heavier price than someone who's 50, 60, 70 years old right now. It's those who aren't born yet or very young that will pay the big price. What would you say is the number one driver of the debt long term? Sure. Well, you know, we're focused on the discretionary part of the budget here, and it is important,

certainly from a good government point of view. But really the drivers of debt are these so-called mandatory or autopilot programs, and that's mainly health care, so Medicare, Medicaid, and then Social Security. They're driving about 75% of the growth in spending over the next decade. And then you also have interest on the national debt. The more debt that we assume, the higher those interest payments become. And soon we're going to be paying more on interest on the debt the national defense. So it becomes a safety issue as well.

So if we don't actually reform those programs, what's going to happen to them? Well, they're already on pace to become insolvent. Social Security and Medicaid are both headed that direction. So at some point the government is either going to have to bail them out, which means more debt. Or we're going to get to this, whenever this breaking point is, it's coming. We don't know when. But the only options available to lawmakers at that point are really drastically increasing taxes or cutting benefits for everyone. But this is unsustainable, and that's the result we're going to see at some point.

So one of the big questions on the conservative side is how do we restrain spending while overall adequately funding defense? And so to turn that question over to you, is there a feasible way for Congress to fund the military adequately while staying within existing cap levels? I think there's absolutely a way to do that. You know, we have our blueprint for balance that we put out in May. We were at $742 billion in defense funding, which is just under the president's request, while maintaining we were actually $40 billion below the overall BCA cap in 2020. And that's through getting rid of a lot of these programs that we shouldn't be involved in,

as I mentioned earlier. So there's absolutely a path to do that. I think the tension here is it's become this problem of in order to get more defense spending, we've sort of been held hostage for the domestic spending. And that's why we've seen these terrible deals that keep coming around. And at some point, somebody has to hold the line firm and really focus on constitutional priorities like defense and let some of these other things go by. So we're starting to see conservatives in Congress line up against this.

a lot of allies of the president saying, we just can't go with this. It's just unresponsible. What do you think the final shakeout is going to be in terms of who votes for this bill and how it passes, if it passes? It's always hard to predict that. From what I've been reading today, it sounds like Democrats think that they have enough support, even some of the progressives they thought they might lose are probably going to vote for this. McConnell, I would assume, will be able to couple up enough.

the votes together to get this through. But you are seeing some pushback on it. And even some Democrats, the Blue Dog Caucus has pushed back against this. You know, they think it should be paid for, as do we. I'm sure they would have a different method of paying for it than we would support. But I think it's good that there are some members on the left that are at least cognizant of the fact that this is really irresponsible. And I would just also mention, you know, this $322 billion price tag that we hear, that's kind of just the... the start of it. The committee for a responsible federal budget did a 10-year estimate of what this would actually cost, and they have it at about $1.7 trillion. By the time you include interest costs

and future spending that will be higher as a result of this. Well, it's a sober moment for conservatives and we'll continue to follow the story as it develops. Justin Bogie, thanks for being back on. Yep, great to be with you. Do conversations about the Supreme Court leave you scratching your head? If you want to understand what's happening at the court, subscribe to SCOTUS 101, a Heritage Foundation podcast, breaking down the cases, personalities, and gossip at the Supreme Court. Well, it seems a month doesn't go by without another anti-Israel comment sparking controversy in the House of Representatives. And on Tuesday, Congresswoman Rashida Tlaeib, who is Palestinian-American, made some explosive comments on the House floor in which she criticized a resolution

formally condemning the anti-Israel boycott divestment and sanctions movement, also known as BDS. Here's what she said. The right to boycott is deeply rooted in the fabric of our country. What was the Boston Tea Party but a boycott? Where would we be now without the boycott led by civil rights activist in the 1950s and 60s like the Montgomery Bus Boycott and the United Farm Workers' grape boycott?

Some of this country's most important advances and racial equality and equity and workers' rights has been achieved through collective action protected by our Constitution. Americans of conscience have long and proud history of participating in boycotts specifically to advocate for human rights abroad. Americans boycotted Nazi Germany

in response to dehumanization, imprisonment, and genocide of Jewish people. In the 1980s, many of us in this very body boycotted South African goods in the fight against apartheid. Our right to free speech is being threatened with this resolution. It sets a dangerous precedent because it attempts to de-legitimize a certain people's political speech and to send a message that our government can and will take action against speech it doesn't like. Well, that resolution passed overwhelmingly 398 to 17.

among those who voted no were Congresswoman Ilhan Omar, Rashida Talib, and Alexandria Ocasio-Cortez. So, Rachel, what are your thoughts on this? My first thought is I was just shocked to see the coverage coming after this vote. CNN politics, their Twitter handle, it's at CNN Politics. They have a tweet. It's still up. And they say breaking House Approves Resolution opposing Israel Boycott Movement and divisive vote. It's like, hey, folks, this is not a divisive vote. 17 people voted against it and 398 people voted for it.

So I just thought that was overblown. Yeah, and that was my first thought. Yeah, yeah, when you got 17 people voting against it. It's not exactly controversial and divisive. I think the budget deal right now is a bit more divisive. Just a tad, just a tad. Yeah, but you know, the interesting thing here, she's situating it in a long line of boycotts that we would all support, like, you know, boycotting Nazi Germany, you know, boycotting South African apartheid, that kind of thing, but especially the reference to Nazi Germany, and she's comparing

that to the BDS movement, basically comparing almost by implication Israel to Nazi Germany, that this is something that we should all be okay with boycotting. And she talked about the right to boycott, but this resolution didn't, you know, resolutions are not binding. When a resolution comes out of the house, it's just the house saying, here's what we think, or here's what we condemn, and it's not restricting anybody's rights to boycott. It's just saying we disagree with those who are boycotting. Right. And I mean, let's think about it this way too. Israel is our greatest ally. And for the House of Representatives, if people, you know, more than 17 people had voted to, you know, have this resolution condemning Israel, that doesn't really stand to reason as Israel is our greatest ally.

In the Middle East. Yeah, in the Middle East. The greatest force for peace and, you know, freedom there. And for her to be, you know, placing this movement against all the others, as you mentioned, Daniel, it's completely unfair. And I think it denigrates those other actual meritous boycotts that we've all supported and talked about. Well, it's good to see BDS still doesn't have mainstream traction in America. It's gotten a lot of traction on college campuses. Our colleague here at Heritage, Joel Griffith, has written a lot about the BDS movement. You can check out his writing at the Daily Signal. But, you know, it has become more mainstream in Europe.

The BDS movement has gained a lot more steam. So at least for the time being, Congress is fairly unified on this, at least a lot more unified than it is on other issues. Yeah, and even Democrats. It was encouraging to see that Representative Elliott Engel said that he doesn't think that this is a wise movement. He said that, quote, I think the BDS movement is harmful, and anyone that promotes it is making a big mistake. So it's helpful to see that even people on the other side of the aisle are very wary of this.

Well, we will leave it there for today. Thanks for listening to The Daily Signal podcast, brought to you from the Robert H. Bruce Radio Studio at the Heritage Foundation. Please be sure to subscribe on iTunes, Google Play, or SoundCloud, and please leave us a review or rating on iTunes to give us any feedback. We'll see you again tomorrow. The Daily Signal podcast is executive produced by Kate Trinko and Daniel Davis. Sound design by Lauren Evans and Thalia Ramprasad. For more information, visitdailysignal.com.