From Washington: The GOP's Deficit Dilemma Continues
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2025. I'm Ryan Schmelz. Republicans are making moves to make the cuts from the Department of Government Efficiency permanent, as Elon Musk criticizes the one big beautiful bill. The rescissions package does have a 45-day clock. So now, once that's sent over on Tuesday, as we're expecting right now, Congress have 45 days to deal with that. If they don't enact those cuts, then that money just resumes. So,

It'd be a big loss for Doge, definitely, as Elon Musk is departing it right now. And we speak to a Republican senator who's been one of the most vocal critics of the one big, beautiful bill passed by the House. The House set the bar way too low. They weren't talking about numbers in context. They just talked about the $1.5 trillion, which is completely inadequate. This is the Fox News Rundown from Washington.

When Congress returns from Memorial Day recess, a number of Senate Republicans are expecting to make significant changes to the one big beautiful bill containing President Trump's priorities on taxes, spending, border, and energy. Like several Senate Republicans, Elon Musk is now criticizing the bill over estimates claiming it will add trillions to the deficit over the next decade. President Trump was asked about that criticism.

We will be negotiating that bill and I'm not happy about certain aspects of it, but I'm thrilled by other aspects of it. That's the way they go. It's very big. It's the big beautiful bill. But the beautiful is because of all of the things we have. Musk, who stepped down from the Department of Government Efficiency this week, alleges Congress is undermining his efforts to cut spending. But now the White House is planning to send a rescissions package to Congress next week.

It's a tool that allows the White House to request spending cuts from Congress. Office of Management and Budget Director Russ Vogt points out it can pass with a simple majority. Simple majority in both the House and the Senate. And the virtue of this is that it's a process that also evades the Senate filibuster. So, again, it needs to pass. So we are we are being very careful that we do not use our procedural opportunities in going down a path that

won't lead to passage, but we're pretty confident the House and the Senate are going to work with us to get this thing into law. What can we expect when congressional Republicans move to codify the Doge cuts? Fox Digital politics reporter Liz Elkind helps break it down. We're expected to see a small package, well, relatively small. It's about $9.5 billion. But as we know, to the federal government, that's basically peanuts right now.

But we're expected that to land on Tuesday. It's going to be covering USAID, NPR and PBS. Those seem to be issues that have, you know, gotten the most response.

Republicans support in needing those cuts so far. So as you said, test runs a good way to put it. But we are probably going to see, you know, moderates, defense hawks who do have issues with cuts to NPR, PBS,

and then USAID, respectively. So we're going to have to see how that goes. But we do know they've been waiting for it. I have a source in senior leadership who told me that House GOP leaders actually wanted the White House to wait until after the reconciliation bill was done to send it over. And that's because a rescissions package does have a 45-day clock. So now once that's sent over on Tuesday, as we're expecting right now, Congress have 45 days to deal with that. If they don't

enact those cuts, then that money just resumes. So it'd be a big loss for Doge, definitely, as Elon Musk is departing it right now. So we're going to

have to see. It's another deadline Republicans have to deal with in the next couple of months. Yeah. And what's fascinating, too, is I feel like there was a lot of misinformation surrounding the rescissions packages and how it works, because you kept hearing this argument, well, let's codify the doge cuts, codify the doge cuts. Well, if they had a 60 vote majority in the Senate, they could have codified them. But if you're going to do it the White House way, where the White House sends the package legally, it has to come from the White House, first of all. But number two,

It's just this fact that you can do a rescissions package with a simple majority is a huge weapon, but they can't act on it until the White House sends it. And you've heard some like Thomas Massey kind of bring this up and say, oh, well, these votes keep getting canceled. They keep getting canceled. Marjorie Taylor Greene's been pretty vocal about it. But the reality is, yes, their time was eaten up by reconciliation up until now. And we have to remember discretionary spending and mandatory spending are two different buckets.

Now, not everyone might know what that means right off the bat, but you know, as Stephen Miller actually explained the other day,

Mandatory spending is the social safety net. Congress has to actually change the law to change that kind of funding versus discretionary spending, which they kind of toggle every year within a set window. They kind of those buckets they have more control over. So basically, we're talking about changing the foundation of a house versus painting the walls. Wow. Two. Yeah, they're two very different mechanisms. Yeah.

One's a lot more difficult to pull off, especially with this razor-thin majority that we've got in the case of reconciliation. But a lot of the funding, the USAID, as we said, NPR, PBS, they really couldn't touch in reconciliation by the rules of what that is. So that falls in the discretionary bucket, which is why they have to deal with it separately. Do you have an idea or any sense of what kind of doge cuts could also be coming in the future if this one goes well?

Well, we're going to see a lot of agencies make those decisions. There is going to be room for Congress to make more doge cuts. We saw President Trump requested a skinny budget that did have billions of dollars in spending cuts in places like NASA and certain research aspects. But really, these specific doge cuts, we're going to have to end up seeing what the department heads, what the cabinet secretaries want to do in terms of

their personnel, their office space, the kind of tech and equipment they have, they're gonna be having to making a lot of unilateral decisions on how closely they wanna adhere to Doge. - If we could talk briefly on Elon Musk here, and this is kind of full circle, I think for some of the reporting you've done on the Hill because you were kind of one of the first ones to maybe show, and I wouldn't say a major trouble in paradise, but definitely some tension starting to build between lawmakers and Elon Musk.

You know, he had some comments that were critical of the one big, beautiful bill this week. You know, you could read that as there was there's tension between the administration or maybe he was just giving an honest answer to a question about his opinion on a bill. But this has this was a relationship that started off very strong. I would say it still is pretty strong, but there were moments of tension between House Republicans and Elon Musk at times.

Oh, definitely. And as there are whenever, you know, a voice outside, you know, the D.C. traditional political realm tries to weigh in on legislative affairs or things with a process that they might not be familiar with, which was the case with Elon Musk. Even with his most recent comments, I've spoken to members who've kind of privately said it's not his place to weigh in in Congress.

They've pointed out that it is, you know, discretionary funding and mandatory funding, as we said earlier, are different things. He wasn't really...

didn't really have its facts straight there. But then you also have a lot of conservatives and fiscal hawks like the Andy Harris's and Warren Davidson's who are critical of the big, beautiful bill when it passed the House. They're kind of using Musk's criticism as a bit of a rallying cry to kind of push the Senate to look for deeper cuts than the House version. And it's interesting you say that, too, because, you know,

When the one big beautiful bill passed, you had Republicans who were holding out all the way until the end. And it seemed as though some of them were saying, well, we're voting yes on this, but we're voting yes with the expectation that the Senate is going to change this significantly and add some of our concerns here, a.k.a. additional spending cuts, correct?

Yes, yeah. We do have some conservatives who said they have some assurances from the White House, from the Senate, that they are going to be looking for deeper cuts. As we know on paper, the Senate's reconciliation bill only binds them to $4 billion in cuts as a floor, whereas the House binds them to $1.5 trillion. A big gap that Leader Thune did publicly tell those deficit hawks that he wants to bridge. But saying something publicly and having your texts

written in legislation are kind of different guidelines. Yeah, they certainly are. And, you know, this was a process that was pretty wild. I mean, each committee had to go through their own markup hearings. How many do you attend in person and did you make it past 20 hours in any of them?

I would love to say that I curled up on the floor of one of the House office buildings at the 20-hour mark, but I did attend several, three of them briefly. I did not stay through the night, but when it came time for the big, beautiful bill to get through the House Rules Committee, I did have a fun 1 a.m. Wednesday until 8 a.m. Thursday stint at the Capitol. And this was...

after you had to sit through the 10 o'clock at night budget committee hearing. There's an iconic picture of you sitting in the middle of the hallway as we're trying to figure out if this thing's going to pass or not. And so this was a marathon. It really was. Yeah, for the members, for the reporters, you could see, as we famously saw, there were a couple of members who fell asleep during proceedings. But you know what? They had to be awake for longer than we did. I would have fallen asleep, too. And some of those guys don't drink coffee, which is crazy.

It really is. And, you know, as this gets moved on to the Senate, I think kind of one of the big questions here, too, is what do you think the big sticking points are going to be that were big points in the House that could make or break whether this thing comes back to the House in a passable form?

There's a lot, right? Because we're going to see a lot of the same fights that we saw play out in the House play out in the Senate. Medicaid, most notably, you've got people like Josh Hawley and Susan Collins who really don't want it touched at all and are even kind of uneasy with the House Republican cuts.

Whereas you see people like Ron Johnson and Mike Lee who do want to take those cuts as far as possible. You see the issue of state and local tax deductions, SALT, as everybody knows it, that was big for the blue state Republicans. You don't really have any blue state Republicans in the Senate who are going to be going to bat for SALT. And it would be a pretty good guess to say that if they're looking for more savings, it could be, you know,

That increased SALT deduction cap that we saw House Republicans put in could be one of the first items on the chopping block in that case, which then, if it comes back to the House that way, would be a huge problem for those New York Republicans. And it's really fascinating to see because right now the deadline that they have set for themselves, July 4th.

We've got several legislative weeks in between then. The Senate's got to do all their hearings, all that whole process and get this thing together. Then they got to send it back to the House. And then, you know, the finagling kind of goes on after that. But, you know, as it stands right now, do you feel this is on track to make that 4th of July deadline?

Well, I mean, everybody I've spoken to has says they're still on track. But remember, a couple of months ago, we did have some folks in the Senate say it might be until the end of the summer. So I'm not sure everybody in the House and Senate is united on the fact that this will be done by the 4th of July. But, you know, then again, when are they ever all united on anything? Exactly. Anything else, Liz, we're going to be watching for next week in Congress that you think would be of note?

Yeah, we're going to be watching out for the restrictions package. And, you know, just want to remind everybody, the debt limit is still a ticking clock that we've got on the horizon. That's part of Trump's bill as well. So in addition to, you know, the self-imposed deadlines, we are projected to hit that debt limit, U.S. running out of cash to pay its debts.

could see another credit default by sometime this summer. So we're going to be watching how that plays out. And we're going to be watching how the appropriations bills for fiscal year 2026 play out next year as well. And we're just getting that process started, really. And keep in mind, I mean, isn't this technically supposed to start, you know, in October? And now we're sitting here. It's June now. It will be June when this podcast airs.

And they haven't really started any of these appropriations markups yet, have they? They have not. But I will say, grain of salt, to be fair, Trump had to send in his budget by October.

couple of months ago, about a month ago. He did. But, you know, I'm not super optimistic about them reaching the September 30th deadline intact on for a couple of reasons. One, as we know, that short, that razor thin majority that they've got, they can afford very little dissent on anything. And they've got a lot of deficit hawks. And then they've got quite a few moderates as well who might not want the same cuts. And then President Trump's budget request did fall short of

some folks' expectations, namely the defense hawks, the armed services committees, want to see more money in Trump's budget for defense. I know Congressman Mike Heredopoulos, he's subcommittee chair of the Space Committee on the House Science Committee. Oh, what a mouthful. But he, I mean, he said that he thinks the White House is going to put more NASA funding back in the bill, back in, you know, when the bill comes. So,

We've got quite a few people expecting changes to Trump's budget before we get to September 30th. So it's going to be interesting to see how all that plays out. And let's not forget, they need 60 votes in the Senate. This is not the reconciliation convenience of being able to pass something along party lines. They're going to need help from Democrats. And that might be challenging with just how much tension we're seeing right now, especially from the fallout with Doge and Elon Musk. So we'll see what happens. Yep.

We'll see. All right, Liz Alkine with Fox Digital. Thank you so much for joining us. We'll talk soon. Thank you so much for having me.

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Senate Republicans are pledging significant changes to the one big beautiful bill, with several senators raising concerns about what's in the extensive package containing President Trump's priorities on taxes, spending, energy, border, and national security. Some have concerns Medicaid provisions in the bill could lead to the most vulnerable seeing cuts to their benefits.

While others don't think it goes far enough to cut spending and reduce the deficit. The Congressional Budget Office, which estimates the cost of policies proposed by Congress and the White House, estimates the bill would increase the federal budget deficit by $2.5 trillion over the next 10 years. Well, first of all, we're talking about budget reconciliation. So we ought to talk about numbers.

Wisconsin Senator Ron Johnson is one of the Republicans concerned about the cost of the bill. He spoke with Dave Anthony on the Fox News Rundown Evening Edition this week about his issues. The only number we talked about was $1.5 trillion, which sounds like a lot of money.

But over 10 years, it really isn't squat. It's barely a rounding error. When you look at CBO's projection, we'll spend about $89 trillion over the next 10 years. By the way, this is probably a rosy scenario. We'll add about $22 trillion to our debt over that time period, averaging $2.2 trillion per year in deficit. And let me just put that in historical perspective.

The last four years of Obama administration, he averaged $550 billion per year deficit. Trump's first three years, over $800 billion in deficit.

Then, of course, COVID hit and we had a $3.1 trillion deficit as we went on a spending spree to make sure the markets wouldn't collapse and take care of all the shutdowns. It should have ended there. We should have gone back down to a reasonable pre-pandemic level spending and deficits. But no, that's not what happened. President Biden averaged $1.9 trillion in deficits over his entire four-year administration.

But now we're looking at 2.2, and I'm sorry, the House big, beautiful bill is going to add to that. Our first goal ought to be we ought to reduce that deficit spending, not increase it. So, again, we just have a fundamental problem. The House set the bar way too low. They weren't talking about numbers in context. They just talked about the $1.5 trillion, which is completely inadequate.

OK. A lot of what the House did was make reform in Medicaid, especially a work requirement for Medicaid recipients. And that's one way they wanted to reduce spending and get rid of waste, fraud and abuse. Is that the right approach or is that just one approach?

Well, listen, we definitely need to reform Obamacare, which is Medicaid expansion, which is putting at risk the Medicaid for disabled children. Okay, so that ought to be fixed. But I've laid out, we increase spending across the board. If you take 2019 outlays, you know, leave Social Security, Medicare, and Medicaid,

interest alone. You can even exclude Medicaid, quite honestly. There's literally hundreds of billions of dollars that we're spending in excess of 2019 spending plused up by inflation and population growth. Then that would be a reasonable control. Take a look at those outlays, increase them to account for Biden's inflation, which was massive, population growth, and we're still hundreds of billions of dollars spending more than that

in things other than Social Security, Medicare, and Medicaid. That's why I've said we need to take the time, go line by line like Doge has taught us. I think you would find hundreds of billions of dollars that if you don't spend it, nobody would even know other than the grifters who are sucking down that waste, fraud, and abuse. Now, President Trump wants more money for border security, more money for the military. Are you okay with that increased spending?

Yes, but we need to put a sharpener pencil on that I asked DHS Secretary Noem requesting $46 billion for the fence. Well, in the first administration they built somebody 450 miles of fence cost them $6.6 billion, about $14.4 million per mile, you apply that 14.4 million she says it's going to cost 12 so I'm being generous.

that'd be building 3,000 miles of fence. Is that what they're gonna do? I don't think so. So again, they just threw some numbers up on the wall. It hasn't been analyzed properly. We need to look at all the spending, including the defense spending.

This is out of control. We need to get serious about this. Of course, there's a lot of tax cuts that are part of this as well, extending what happened in 2017, the tax cuts then. And you also have the new provision to mollify the concerns of blue state Republicans to increase the SALT cap, state and local taxes from $10,000, which was what happened in 2017, up to $40,000.

That hasn't had a successful offset, correct, in your opinion? First of all, I would extend current tax law. If we were smart enough to use current, if we would have been smart enough to use current policy in 2017, this wouldn't even be an issue. So I don't want to have an automatic tax increase. I would just extend that. But again, when you're running, you know, on average $2.2 trillion of deficits over the next year, this is not the time for tax cuts, particularly tax cuts that don't

incentivize growth. And a lot of these proposals on the table, they're not going to incentivize growth. They're just going to reduce revenue. So again, we need to have this discussion. What we've had so far is just rhetoric. We've got a slogan, one big, beautiful bill, very similar. This is almost identical to what happened with Obamacare. We had a slogan, repeal and replace.

And nobody really had a good way of doing that. I said we should, you know, fix what's broken in Obamacare, repair the damage done and transition to a health care system that works. We didn't do that. So now we're dealing with Obamacare named Medicaid expansion would put you at risk. Medicaid for disabled children. All right. Of course, Democrats are saying that these cuts are drastic.

The ones you talk about are that Senator Paul had said were weak and anemic. They say they're drastic. Millions of people will lose their health coverage. Millions of people will lose their food assistance. And they're they're sounding a very loud alarm. What's your reaction to their criticism?

They'll always say that. They have no problem indebting and mortgaging our children's future. So again, we've just approached it the wrong way. You don't start at a completely unjustified level spending $7 trillion when you spend $4.4 trillion just six years earlier. You go back to that $4 trillion.

plus it up that would establish a reasonable pre-pandemic baseline that ought to be our starting point which would be somewhere between 5.5 and 6.5 trillion dollars you always hear people say zero-based budgeting well i'm proposing a 5.5 to 6.5 trillion dollar base budget build off of that as opposed to start above 7 trillion and suffer death by a thousand cuts that's what happened in the house but if you come up with a much different version than the house

You do risk having the House Republicans, who didn't really want to go along with it but finally did, to say no, and then the whole thing collapses that way. Well, it'll take presidential leadership. So we need President Trump to be serious about his pledge in the State of the Union where he said he was going to balance the federal budget. Well, you don't balance the federal budget, you don't defeat the deep state by continuing to spend at President Biden's level. So this will require presidential leadership,

I'm digging my heels in so that he provides that leadership. Okay. Do you think it's possible that the better approach would be to have a couple of different bills rather than one? Or do you have to have one because of the reconciliation process? I was always recommending a three-step process, provide the border funding defense, bank $850 billion of real spending reduction. That's just a start.

Then I would -- the next thing I would have done is I would have just extended current tax law as a second step, then come back and argue the big, beautiful bill. Too late for three steps, so right now I would combine border, defense, take what -- the good work the House did in terms of spending reduction, extend current tax law, take an automatic tax increase off the table, and then increase the debt ceiling for about a year to keep pressure on the process to come back and use fiscal year 2026 budget

to really get down to pre-pandemic level spending and then do all the arguing and all the other taxes. I'd like to take the opportunity to try and simplify and rationalize our tax code as opposed to just hand out more tax cuts, increase the deficit, make our tax code more complex and more difficult to comply with, which quite honestly, that's a lot of what President Trump has proposed. It's going to make the tax code more complex. I wouldn't want to be a payroll manager having to try and segregate out the tips that are going to be taxed, those that won't.

what overtime is going to be taxed, what won't, based on income levels. I mean, that adds to the regulatory burden. I thought we were supposed to reduce the regulatory burden. Those are big ones, though, for the president and the campaign. I assume he's going to want those in there. Well, I campaigned on the fact that we shouldn't mortgage our children's future. I made that promise three campaigns in a row. That's what I campaigned on. That's what I pledged to my constituents. Fourth of July, too optimistic to get this done? I think so. Unless we split it up into two bills, I think it's pretty easy to do.

All right, Senator, I want to turn to another big issue for you, the controversy about former President Biden's mental fitness to keep doing the job. Of course, there was that presidential debate last June, and then he dropped out of the race, stopped running for reelection. Your colleague in the House, Congressman James Comer, he told Fox's Hannity the other night the oversight committee that he leads plans to call four ex-Biden White House staffers to come testify. This is what he said. These are the unelected bureaucrats that we believe had an overwhelming influence on

over Joe Biden and could have possibly been serving as de facto presidents of the United States. Now, Senator Johnson, you chair the Permanent Subcommittee on Investigations. You plan your own probe into this, correct? Right. What we've done is we've written letters to, I think, 28 White House officials that will probably expand. First, to request an interview. Well, I think I have some pretty basic set of questions to ask these folks. And then based on what answers we receive,

We'll take it from there. I would not recommend bringing people in for a hearing right off the bat. You actually need to do an investigation here. You need to talk to a bunch of people, compare their testimonies. I'm hoping we don't have to speak to people, but we've written those letters. We'll probably write some more. We're developing that list of questions and hopefully have those interviews when we get back in June. And you're not just talking about a couple of staffers here. You want to talk to...

some high level people from Vice President Harris, the former vice president, all the way down through the cabinet, right? Yeah, this is serious business here. We had obviously an infirmed president of the United States. It was obvious. I knew he was unfit for office for a host of reasons, including his declining mental and physical state. But there's a reason we have the 25th Amendment, because the president of the United States is the most powerful elected official in the world. He has access to the nuclear codes.

We have that 25th Amendment because we expect the vice president of the United States, the members of his cabinet, when they see that a president is no longer capable of fulfilling his duties of office, the oath he took, they have to step in and they've got to be honest with the American public. They weren't. We need to vet that because we can't allow that to happen in the future. You know, Democrats say, look, look back on everything. We're looking forward. We don't need to go through this process. It's all in the past. Why? Why?

Do you think it's so important for us to go forward? And what do you think could happen? And what's the goal of your investigation? Again, we need to find out who is actually running the country, who is signing pardons, who is making these decisions, and how could that have affected what happened, what kind of disaster might have occurred before.

if the president of the United States wasn't actually in charge. These are serious questions. I think the American people deserve the answer. Do you think that someone might have acted criminally in all this? I don't know that you can say. This is a political process. So I'm not sure about criminally, but this is a political responsibility that we need to hold people politically accountable. Senator Ron Johnson, Republican from Wisconsin, chair of the Permanent Subcommittee on Investigations. Thank you so much for joining us today. Have a great day.

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That'll do it for this edition of the Fox News Rundown from Washington. Next week, we continue following House Republicans' efforts to investigate the Biden administration over allegations there was a cover-up of President Biden's alleged cognitive decline. For now, I'm Ryan Schmelz. Thank you for listening to the Fox News Rundown from Washington.

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