One-on-one with Treasury Secretary Scott Bessent

Joining us now to discuss

this and much more.

Treasury Secretary

Scott Bessent

Secretary Bessent,

thank you so much

for being here.

Always a pleasure.

So let's just start

with the Snap ruling,

because two federal judges

ruled Friday night,

the white House must tap

into the contingency funds

to partially cover

Snap benefits that expire

this weekend

due to the shutdown.

Yesterday,

the court clarified that

at least a partial payment

needs to be made by Wednesday.

When can we expect the Trump

administration

to make these payments?

Well, President Trump

just threw out

that he needs

to hear from the courts

how this is going to be done.

And Jake,

as you know, the best way

for Snap benefits to get paid

is for Democrats,

five Democrats

to cross the aisle

and reopen the government.

Right.

But there is

this contingency fund.

And as recently as

September 30th,

the Agricultural Department

had a memo saying that

these funds,

the contingency funds,

I think it's about 5

or $6 billion,

could be used to pay

these benefits.

Now it only be 2 or 3 weeks.

But that's a lot

for people who need the

who need the food.

Well, President Trump,

just as I said,

President Trump

just truthed out

that he's very anxious

to get this done.

And it's got to

go through the courts.

The courts

keep jamming up things.

Democrats are in the middle

of a civil war,

and they should just

open the government.

That is the easiest way to do

this.

Is the administration

going to appeal

the ruling by the judge?

Is that what you mean by

the courts need to weigh in

because the courts

have weighed in?

No but

there's a process

that has to be followed.

So we got to

figure out what the process is.

President Trump

wants to make sure

that people

get their food benefits.

So it could

it could be done by Wednesday.

Could be okay. Could be.

And you know, five Democratic

senators could cross the aisle

and open the government

by Wednesday.

Let's turn to trade,

because that's been obviously

your focus for several weeks.

You're just back from China.

President Trump

called the summit

with President

XI a great success.

China's biggest concession

was it suspended,

the export controls

on these rare earth minerals

that were used for our phones

and other things.

Trump said this

settled the issue.

The conservative wall Street

Journal editorial board,

however, says the deal

mostly restores

the status quo

that prevailed in May

and that if Mr.

Trump wants to deter

Chinese mercantilism,

he needs a new strategy

and more allies.

What's your response

to their view of this?

Well,

I couldn't disagree with that.

More is what

what are the sources of U.S.

strength

and how does China view us

that we have?

We're

the greatest military power

in the world.

Number two,

we have the greatest economy.

We have the reserve currency.

And number three,

it's our innovation

and technology

and everything

that came out of the conference

between President Trump

and President XI.

They gave the US more leverage.

Now China has invoked

the this rare earth,

export regime.

They did it once on April

4th for rare earth magnets,

and they tried it again

on October 8th. On October 8th.

The president

very forcefully pushed

push back.

He threatened

to add 100% tariffs

to Chinese products,

and we were able to negotiate

a one year,

pushback

or a one year

suspension for this,

licensing regime

and the licensing regime.

Let me tell you,

it's for every thing

that contains

rare earths produced in China

that has 0.01%,

it was completely unworkable.

And it wasn't

the US versus China.

It's China versus the world.

They put it on the whole world

and the whole world back.

President Trump,

the leader of the free world,

the push

back on behalf of

a whole world,

said,

do you disagree

with the assessment

that that

all this deal really does

is reset

things to where they were

May before a lot of this

trade war began?

Well,

I think it's naive

for the Wall Street

Journal editorial board,

who I call a bunch of grumpy

old men to.

They think that

the Chinese weren't

going to roll out

these rare earth restrictions.

They've been putting this plan

together for 25, 30 years.

And the US has been asleep

at the switch.

And now this administration,

we're going to go at warp

speed over the next one,

two years,

and we're going to get out

from under the, you know,

the sword

that the Chinese have over us

and they have

over the whole world.

And this time

we have rallied the allies.

And so it is going to be a

all the Western democracies,

the Asian democracies and India

are also going to join us

in this

in trying to

form our own supply chains.

We don't want to

decouple from China,

but we need to de-risk.

They've shown themselves

to be an unreliable partner

in many areas.

Let's talk about Canada

for one second,

because while this deal

is going through,

the president

imposed a 10% tariff,

additional tariff on Canada

because he didn't like this

ad that Ontario had put out

featuring President Reagan

talking about tariffs.

The prime

Minister of Canada

has apologized

to President Trump for that ad.

When can we expect

that 10% tariff to be taken?

He hasn't put on a 10% tariff.

He threatened to

put it on a ten.

So he didn't actually do it.

It hasn't been put on yet.

And this is unacceptable

that I read that

the premier of Ontario spent

$75 million sending propaganda

across the U.S.

border via

Ronald Reagan's own words

via our airwaves,

via our own airwaves.

You know, it's

the equivalent

of election interference.

Nobody likes foreign

election interference.

Nobody likes

foreign governments

trying to sway public opinion

for their own good.

So the

10% tariff has not been enacted

and it might not be enacted.

You know, we'll see.

I do think it was a big setback

for the Canadian government.

And the premier of Ontario

should be ashamed.

He's probably

still smarting from the Blue

Jays loss last night.

Well, that's harsh.

And congratulations

to our Dodger friends

out there.

Let's talk about this week,

because on Wednesday,

the Supreme Court

is going to hear

arguments in two cases

related to President

Trump's tariffs.

First of all, is

President Trump

planning on going

attending the oral arguments?

And second of all,

given the fact that tariffs

are the province of Congress,

according to the Constitution,

even though there

is this exception

for emergency, tariffs.

What makes you think that that

you guys will win this case?

Because the president is

implementing the tariffs

under an emergency authority.

And I actually think

that the Chinese actions

on October 8th by threatening

the entire world

with rare earth export controls

that could have slowed down

or shut down

the Western

manufacturing system

by the threatening 100%

tariffs

under the EPA authority,

the president was able

to get the Chinese

to delay this.

So if that's not an emergency,

I don't know what is.

But but, Jake,

if we look at

if we look back to the spring,

the president

put 20% tariffs on China

and now

brought China to the table.

They are going to make

an earnest effort

to stop sending precursor drugs

to North America,

killing hundreds of thousands

of Americans every year.

And if the fentanyl deaths

are not an emergency,

I don't know why it is.

So he is using these powers

under an emergency act,

and those are all emergencies.

Is President Trump

going to be at the court

on Wednesday?

I haven't seen his schedule.

You haven't seen this.

Are you going to be there?

Sorry. Are you going to go?

I'm not planning on going

You’re not planning on going.

President Obama

is out on the campaign trail.

And not surprisingly,

he's been pretty critical,

of President Trump.

Take a listen.

He has been focused

on some critical issues,

like paving over

the Rose garden

so folks

don't get mud on their shoes

and building a $300

million ballroom.

And if you don't

get an invitation

to the next white House

shindig,

you can always watch,

the festivities

on on Trump's

live feed on Truth Social.

Now, these comments came

within a day of the president

hosting a Gatsby,

pardon me, a Gatsby

themed Halloween party

at Mar-A-Lago.

While Snap

benefits are set to run out

and you can understand

the general theme.

I've heard Republicans

even expressed concern

about the general optics

here of parties

and lavish ballrooms and such.

While

a lot of Americans are hurting.

What's your response?

My my response

is that the Democrats

should reopen the government.

And, you know,

I believe President

Obama played

a record amount

of golf of any president.

So, you know, I'm

not sure why he's out there

throwing stones.

And you know that

it's unfortunate.

We've got

52 Republican senators

who have voted

to reopen the government,

three brave Democrats.

And I'm calling here

on five moderate

Democrats to be heroes.

Let's reopen the government.

This week,

the fed voted

to lower interest rates,

another quarter of a point

to its lowest level

in three years.

However, the central bank's

newest official,

Stephen Miran, is warning

that if the fed doesn't

continue to lower

interest rates rapidly,

the U.S.

could face a recession.

Do you agree that the U.S.

is at risk of facing

a recession?

I, I believe

that we are in a

transition period here,

as we are seeing,

the Trump

administration has cut

back on government spending.

Jake,

what has gone

unnoticed during

the shutdown

is that for the fiscal year

that in September 30th,

the government spent

less than it

did the year before.

And because the GDP grew,

the GDP, which had been 6.4,

the deficit to GDP,

which had been 6.4

or 6.5%

deficit, the highest

when we weren't at war,

weren't in a recession ever.

We were able to bring it

down to 5.9%.

So we are bringing down

government spending.

And I would think

that the fed

would want to assist with that,

because if we go back

and look at MIT

just published a study

that said

42% of the great inflation

of 2022

came from excess

government spending.

So if we are

contracting spending,

then I would think inflation

would be dropping.

The inflation is dropping,

then the fed should

be cutting rates.

But do you think that the US

is at risk of a recession

if the fed does not continue to

drop rates?

I think that we are in

good shape, but I think that

there are sectors

of the economy

that are in recession,

and the fed has caused

a lot of

distributional problems

with their policies.

I know I wrote a 7000

word essay on that.

You know, we've seen

the biggest hindrance

for housing here that

are mortgage rates.

So, you know,

if the fed brings down

mortgage rates,

then they can end this

housing recession.

Low end

consumers

who have gotten killed

under President Biden,

they these high

rates are hurting them

because they have debt,

not assets.

So I think that

there are sections

of the economy

that could go into recession.

All right.

Secretary Bessent,

thank you so much.

We really appreciate

you being here.