MULVANEY: Prove it. Prove it to them. Give them three or four years
of 3 percent economic growth and let them see what it’s like. If you
were 18 years old in 1978, you thought mortgage rates would always
be 16, 18 percent. It’s all you knew. We can show these young people
what it’s like to be in a healthy American economy, and show them
what it’s like to have that American exceptionalism and let them
decide for themselves the best way to achieve and maintain it.
RUSH: There are segments of the American economy that are
exceeding 3 percent.
RUSH: Silicon Valley.
RUSH: People are getting rich beyond all expectations in Silicon
Valley. [Laughs] Even journalists in Silicon Valley are doing well —
RUSH: — and yet they remain unconvinced that across-the-board
economic growth nationwide, as is happening there, is worthwhile.
That’s just the pervasiveness of politics. Look, I want to get to the
debt limit here because this is a bugaboo. I think we’re expected to
reach the debt ceiling again by, when, August?
MULVANEY: Yes, sometime late August, maybe early September.
RUSH: Okay, now we know how this goes. As we get close to the
debt ceiling, immediately we start talking shutdown, which
paralyzes Republicans on Capitol Hill who don’t want to be blamed
for it. And so, while we’ve got to raise the debt ceiling, we have to
keep the government operating, we can’t afford a shutdown and so
the mechanism whereby we can actually freeze the government’s
economic expansion, the size of government, always vanishes.
When does this cycle end? How does it end?
MULVANEY: Actually, I welcome the cycle, and here’s why. When
we bump up against the debt ceiling, it’s a sort of fiscal smoke
alarm, right? So the smoke alarm goes off and you step back and
say, “How did we get ourselves in this problem?” Then we pass
reforms. The classic example is Gramm-Rudman-Hollings, which
was passed as part of a debt ceiling increase a couple decades ago. If
you’re going to automatically raise the debt ceiling without asking
yourself why you have a debt problem, or taking the time to come
up with reforms to fix your debt problem, then there’s no reason to
have a debt ceiling law in the first place. So to the extent we use this
cycle as a mechanism to force ourselves to have tough conversations
about our fiscal plan, then I welcome that.
But I hear what you’re saying about the fact that we just tend to
give in and tend to move on to the next topic. Don’t conflate the
debt ceiling with the government shutdown; a debt ceiling can lead
to a government shutdown, but a government shutdown is not a
RUSH: Well, we don’t have to shut it down. All it takes is the allegation that there’s going to be one, and Republicans
RUSH: The government has shut down frequently over
the years and nobody even knows it half the time.
MULVANEY: There were five of them during Jimmy
Carter’s four years in office, a time when the Democrats controlled the House, the Senate, and the White
House. But you’re right to draw attention to the fact
that the budget process is broken. Rush, one of the
things we focused on in our budget is the unauthorized programs, okay? These are programs for which
there is no Congressional authorization. That’s where
you lose that oversight. We’re spending money on
programs we haven’t looked at in 10, 15, 20 years.
RUSH: It sounds like runaway regulations. Those
things happen without Congressional oversight or
MULVANEY: Government has an inertia, and a
mind and a life of its own. You have to actively try
to corral it.
RUSH: My take is that President Trump is not ideo-
logical in the way I am, for example. In other words,
when he sees, say, a Chuck Schumer, he doesn’t say, “There’s a
screaming leftist.” He just says, “There’s a New York guy I’m up
against here.” He’s not ideological, so it would be a mistake to try to
attach ideology to the President’s decisions. But does he instinc-
tively agree with you, and understand the need to get this budget
under control and manageable so that it’s not just expanding?
MULVANEY: You’re right, Rush. At a certain level the President is not
ideological like you and I would be. That’s not how he’s put together.
But he does get it, and he knows from his experience in the real world
that the one thing that can take a healthy company and drive it out of
business overnight is an adverse debt position when times turn bad.
All my friends in the homebuilding business saw that in 2007,
2008. The President has seen it in his lifetime several times over
during the various recessions. We know from that industry that debt
can be a great thing and debt can also be the most dangerous thing in
the world, and he gets that. He knows the risks, and grasps the risks
that this huge debt position gives us. If interest rates go back to the
historical norm — I think the 40-year trailing average is like 6
percent — if it goes back to that tomorrow, we’re broke. PH O T