Sen. Ron Johnson on reconciliation bill: We don't have time to get this right by July 4

Key Concepts:

• Deficit spending: The amount by which government spending exceeds revenue.
• Pre-pandemic spending levels: Government spending levels before the COVID-19 pandemic.
• CBO score: The Congressional Budget Office's estimate of the budgetary impact of legislation.
• Mandatory spending: Government spending that is required by law, such as Social Security, Medicare, and Medicaid.
• Discretionary spending: Government spending that is not required by law and is subject to annual appropriations.
• Debt ceiling: A limit on the total amount of money the United States federal government is authorized to borrow to meet its existing legal obligations.
• SALT cap: A limit on the amount of state and local taxes that can be deducted from federal income taxes.
• Clean energy credits: Tax credits for investments in renewable energy sources.
• Fiscal conservatives: Individuals who advocate for lower government spending and balanced budgets.
• Devaluation of the dollar: A decrease in the value of the dollar relative to other currencies.

1. The Core Issue: Unsustainable Deficit Spending

• Senator Ron Johnson expresses deep concern about the current trajectory of U.S. deficit spending. He emphasizes that the proposed legislation does not adequately address the problem and could exacerbate it.
• He highlights the dramatic increase in spending during and after the pandemic, noting that deficits under Biden and the Democrats averaged $1.9 trillion per year, significantly higher than the pre-pandemic average of $661 billion.
• The CBO projects average deficits of $2.4 trillion over the next ten years, even the White House's "rosy scenario" still projects deficits of nearly $1.9 trillion.
• Johnson argues that the focus should be on returning to pre-pandemic spending levels, which he believes is a reasonable goal.

2. Critique of the Current Budget Process

• Johnson criticizes the current budget process, stating that it lacks a clear definition of the problem and relies too heavily on political considerations (i.e., securing 51 votes in the Senate and 218 in the House).
• He argues that simply aiming for a $1.5 trillion spending reduction over ten years is insufficient, given that spending increased by over $2 trillion in a single year (2019-2020).
• He plans to release a 30-page report detailing the reality of the situation.

3. The July 4th Deadline and the Need for Deliberation

• Johnson believes that the July 4th deadline for passing the legislation is artificial and does not allow for sufficient time to properly analyze the complex details of the bill.
• He points out that the House bill is 1100 pages long, and even the Senate Finance Committee's summary of the tax revisions is 37 pages.
• He intends to use his position to force a more thorough discussion of the numbers and the massive deficits that are projected.

4. A Businessperson's Approach to Fiscal Responsibility

• Johnson advocates for a businessperson's approach to fiscal responsibility, emphasizing the importance of first admitting that there is a problem and then properly defining it.
• He believes that the current approach focuses too much on revenue problems and not enough on spending problems.
• He suggests that if spending cannot be reduced, then perhaps taxes should be increased, although he considers this a "stupid thing to do" and would prefer to simply extend current tax law.

5. Specific Areas for Spending Cuts

• Johnson identifies several areas where spending cuts could be made, including other mandatory spending and non-defense discretionary spending.
• He provides specific figures for the amount of spending above and beyond 2019 levels, fully adjusted for inflation and population growth:
  • $384 billion in other mandatory and other non-defense discretionary.
  • $517 billion including Medicaid.
  • $578 billion compared to Obama in 2014 (excluding Medicaid: $803 billion).
  • $1.3 trillion compared to Bill Clinton.
• He argues that these cuts are achievable because spending is "all over" every category.

6. The Immorality of Indebting Future Generations

• Johnson expresses strong moral concerns about the impact of current fiscal policies on future generations.
• He argues that indebting children and stealing from their future prospects is "immoral" and "unconscionable."
• He points to the devaluation of the dollar as evidence of the chronic debt crisis, noting that the 1998 dollar was worth $0.51, the 2014 dollar was worth $0.74, and the 2019 dollar was worth $0.80.

7. Senate Opposition and Potential Delays

• Johnson is confident that he has enough support in the Senate to delay the legislation until at least the August recess.
• He mentions Senators Rick Scott, Mike Lee, and Rand Paul as potential allies in this effort.
• He believes that a larger group of fiscal conservatives is working behind the scenes to achieve a better result.

8. Rick Scott's Expertise on Healthcare

• Johnson highlights Senator Rick Scott's expertise on healthcare, particularly his knowledge of hospitals, rural healthcare, and nursing homes.
• He suggests that Scott's ideas are not being incorporated into the current legislation because of the rushed timeline.

9. Notable Quotes:

• "Three quarters of the word can't is can."
• "The first step in solving any problem is admitting you have one and then properly defining it."
• "Indebting our children stealing from their their future, their prospects, the way we've diminished them is immoral. It's unconscionable."

10. Synthesis/Conclusion:

Senator Ron Johnson is deeply concerned about the unsustainable trajectory of U.S. deficit spending and believes that the proposed legislation does not adequately address the problem. He advocates for a return to pre-pandemic spending levels, a more thorough analysis of the budget numbers, and a businessperson's approach to fiscal responsibility. He intends to use his position to force a more comprehensive discussion of the issue and is confident that he has enough support in the Senate to delay the legislation until at least the August recess. His primary concern is the moral implications of indebting future generations and diminishing their prospects.