Politics & Policy

Five Questions for Senator Ron Johnson

Sen. Ron Johnson (R-Wis.) asks questions during the Senate Homeland Security and Governmental Affairs/Rules and Administration hearing to examine the January 6, 2021 attack on the U.S. Capitol in Washington, D.C., March 3, 2021. (Greg Nash/Pool via Reuters)
A U.S. senator on the confirmation process.

1) You were very helpful to me and many other Trump nominees. The Democrats delayed nominees as long as possible. Why are you being so nice to Biden’s nominees?

When I meet with nominees of both parties, I try give them some friendly words of advice. My best advice to nominees is that a confirmation hearing is something to get through, and not necessarily an occasion to make all kinds of wonderful points or win arguments with U.S. senators. From my standpoint, there are way too many confirmable positions and a president should be able to quickly staff his administration and build the team he wants. Being president of the United States is the toughest job in the world, and presidents of both parties have to sit around and wait to staff their administrations because of obstruction in the Senate. It’s ridiculous. From my viewpoint, there probably ought to be no more than a couple of hundred administration positions subject to confirmation. Obviously, cabinet secretaries and other top officials, but for staffing the remainder of any administration, the president elected by the people ought to be able to fill most positions without waiting for the U.S. Senate to act.

This time around, because of COVID-19, we don’t meet. It’s all phone interviews. I even enjoyed my conversation with Neera Tanden — we had a great phone interview. I never got to vote for or against her. They killed that nomination on their own.

But make no mistake, there’s a huge, huge difference between how we are treating President Biden’s nominees and what President Trump’s team went through. It was so bad that there was pressure put on us by President Trump, House members, other conservative supporters to end the filibuster. We didn’t cave to that pressure because we realized it was not a good thing for the country or for the institution of the Senate. If you get rid of the filibuster, why even have a senate?  Just expand the house by 100 members.

2) Do you think there are more Democratic senators that understand the importance of the filibuster but are afraid of saying anything that might enrage “the squad” and the rest? There are some pretty radical proposals out there. Do you think the far Left will have its way on economic policy?

You might find it hard to believe, but the Senate is still quite collegial. It’s a bit like that old cartoon with the sheep dog and the wolf, Sam and Ralph. They walk to work each morning as best friends, but once they’re punched in, they beat the crap out of each other. And then at the end of the day, the wolf’s in a cast and all bandaged up, but they clock out and probably head out for a drink. Let me say, as an example of collegiality, that Bernie Sanders is holding some pretty interesting budget hearings on income inequality. I generally disagree with his take on things, but he is running some great hearings. After that hearing, Tim Kaine and I had a great conversation about a tax idea we both like, which is to treat all income the same, rather than arbitrarily having different rates for every different types of income. So the Senate is a very collegial place, at least for most people most of the time.

But it’s also important to understand the current group of Democrats in the Senate is a much more radical bunch than there’s ever been. We are hearing rumors that there may be six or seven Democrat senators that are keeping their heads down but also don’t like the prospect of voting to end the filibuster, because they have the intelligence to realize that what goes around comes around. But only two have declared their support for maintaining the filibuster, and they’re taking all the heat. You have to respect that courage. But I do think there are other Democrat senators laying in the weeds hoping that they never have to vote on the filibuster. Remember, 33 Democrat senators (28 are still serving) joined a Susan Collins letter in 2017 urging Senate colleagues to retain the filibuster. You have to ask what changed most of their minds.

3) Well, it might still be like Sam and Ralph, but it does seem that many people are deciding not to run again. What do you think is driving that?

My guess is that it has gotten to be a more frustrating place. But it’s hard for me to answer the question, Kevin, because I’ve never served in a functioning Senate. It was pretty well broken by the time I got here in 2011. There may be some people who miss the good old days, but it has been a mess ever since I got here. Harry Reid really started us down a path that has spiraled out of control. He made the decision to completely violate precedent and change the rules in the middle of a session with a mere 51 votes in order to pack the court. And McConnell warned Democrats that they would regret that decision at some point in the future. Harry Reid went a long way toward destroying the Senate as it had traditionally operated. It’s an enormously frustrating place, because it’s very hard to accomplish things you want to accomplish. You would think we could at least slog through twelve appropriation bills every year, get them on the floor for a week, offer amendments, and get things passed, and move on. But we can’t even do that. We end up with these massive omnibus spending bills, which end up being big Christmas trees, and nobody knows everything that is in the things. There’s no way you have time to read these bills that are often 1,000 to 2,000 pages long. You and your staff never even see these bills until they’ve been introduced on the floor of the Senate.

4) You have always been a budget hawk. We just spent about $5.3 trillion protecting the economy from the COVID-19 crisis. How do you think it ends?

In a crisis. That crisis is going to hit because nobody here will do anything about it until a crisis hits. Collectively, there simply is not the willpower to do anything about this. I first ran in 2010 and still consider myself more part of the Tea Party than the Republican Party. Two issues I ran on were Obamacare and the deficit. I agreed with John McCain that the deficit issue is not just an economic issue, it is also a moral one. I think when I entered office, the debt was $14 trillion. Now it’s double that. That’s a bill we are just handing to our kids. My guess is that we will eventually inflate our way down to a more reasonable debt-to-GDP ratio, but that process will be very painful, and grossly unfair to low- and fixed-income Americans, and anyone holding current U.S. debt.

I know we had to do something incredibly fast because of COVID-19 — we had to do something massive. We couldn’t allow a lack of confidence to lead to panic about our financial institutions. So that’s the main reason I supported the CARES Act. And what we did worked. But we could have gotten away with spending so much less had we more effectively targeted the spending.  I mean, again, it just breaks my deficit-hawk heart that so much money was wasted.

5) Looking back at Trump’s policies before the pandemic, what do you think the bottom line should be about their effectiveness?

My feeling is that progress was made, but we missed some big opportunities. We obviously made our tax system more competitive, but we didn’t simplify or rationalize it. I think we overshot in how much we lowered the corporate-tax rate. We didn’t really do much in terms of taking away tax preferences and simplifying the tax code. During the tax debate, I kept telling the members of my conference — and anyone who would listen — that we were too focused on rates and not focused enough on tax simplification and tax rationalization. One of my favorite sayings is “All change is not progress, all movement is not forward.” So we didn’t take the once-in-a-generation opportunity to dramatically simplify and rationalize our tax code. What I said in the budget hearing I reference earlier, and then discussed later with Tim Kaine, is just one example. I mean, it’s crazy that we have an arbitrary and different tax rate for capital gains. Now, I don’t think you should tax inflationary gains. Simply index inflation out of the gain, and then tax the remaining gain as ordinary income using the same individual taxpayer rates.

If we really simplify, we could even do away with the corporate tax and tax everything at the individual rate. I would prefer a flat tax, but I accept the fact that progressive tax rates are what Americans want, and a progressive system is here to stay.  But we tax business income at the ownership level for Sub-S, LLCs and partnerships, and those business types are something like 95 percent of all American businesses. I proposed this way of taxing business income during the 2017 Tax Reform debate. I called it “The True Warren Buffet Tax.”  There are many advantages to this system, including a more efficient allocation of capital and making stock ownership more advantageous and attractive to lower-income Americans.  I am continuing to push this idea and hope to have more information in the near future.

But to be sure, the policy victories passed by Republicans and the Trump administration did have a big and positive impact on the economy and the lives of ordinary Americans. But you can always do better.

Kevin A. Hassett served in the Trump administration as a senior adviser to the president and is a former chairman of the Council of Economic Advisers. He is the senior adviser to National Review's Capital Matters, a new initiative focused on financial and economic coverage, and is the Vice President of the Lindsey Group.

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