House Speaker Mike Johnson Talks Big Beautiful Bill
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Bloomberg Audio Studios. Podcasts, radio, news. House Speaker Mike Johnson joins us now. Thank you so much for your time this morning. We'd love to begin there. Have you received a call back from Mr. Musk? Yes, Elon. Look, Elon's a good friend. We texted late last night. We're going to talk this morning. I just want to make sure that he understands what I think everybody on Capitol Hill understands. This is not a spending bill, my friends. This is a budget reconciliation bill.

and what we're doing here is delivering the america first agenda this is all the president's priorities and all the priorities of the republican party everything we promise the american people that is what we are delivering with this piece of legislation and the reason we're using the reconciliation process

is because that is the only way to get around the 60-vote threshold in the Senate. Everybody probably recognizes Chuck Schumer and the Democrats are in no mood and not going to be helpful in delivering President Trump's agenda for the people. We have to do it this way. We can do it with 51 votes in the Senate only, and that's the urgency of the hour. And we have to do it quickly for all the reasons we can discuss this morning. So did you get a sense from Elon Musk in those text exchanges that he was going to stop his insistence on this bill

that he thinks needs to be killed? He seems pretty dug in right now and I can't quite understand the motivation behind it but I will tell you that what we're delivering in this bill is not only historic tax cuts but historic savings as well. He seems to miss that. I mean, the projection is that this legislation is going to save us 1.6 trillion dollars with a T. Now there's never been a piece of legislation ever delivered in the history of government on the face of the earth

that saves that much money. So this is truly historic. Now, is it enough? No, because all three of us understand that we have a large federal debt, we've had deficits for some time, and it's a serious concern. In fact, it's the number one threat to our national security. But this is the biggest step in addressing that problem that Congress has ever delivered, and we must do it. And I will hasten to say this. I've told Elon and tell everyone.

This is the first of a series of steps that we will take to bring that debt under control. But you can't turn it on a dime. It took us decades to get into this situation, so we have to do it incrementally. And this is a huge step forward in that endeavor. What's the driving force behind Elon Musk's problems with this bill? Has he asked you directly to potentially keep the electric vehicle benefits we saw under the Inflation Reduction Act of the Biden era into the bill?

Look, I'll let everybody draw their own conclusions about Elon's motivations. I'll tell you that, I mean, obviously the EV mandate going away is, I'm sure, a concern for, you know, the leader of Tesla and other things as well. But...

I think there's a lot of confusion out there about what the legislation is. There's certainly a lot of misinformation. I mean, the Democrats have been engaged in this effort, this strategy for many, many weeks and many months. But remember, it took us over a year to develop this piece of legislation. We have 11 different committees in the House, all their areas of jurisdiction, that worked on the reconciliation effort to reconcile the budget. And what we're going to deliver here, again, is historic tax relief evidence.

and savings at the same time. If we do not get this bill done, the tax cuts of 2017, the Tax Cuts and Jobs Act, will expire at the end of December. Every American will receive the largest tax increase in U.S. history all at once. It will be devastating for the economy. So we've addressed that here. We've made the tax cuts permanent, and we've

we've infused it with a pro-growth series of policies that will get the economy going again. It will be jet fuel to the economy because we're going to reduce wasteful spending, we're going to reduce taxes, and we're going to reduce regulations as well. And that is what will allow job creators in the energy sector and everyone else to get going again. And your version of the bill, of course, increases the SALT deduction cap, which yesterday Senate Majority Leader John Thune said, quote, there isn't a single Republican senator who cares much about the SALT issue. You and I both know.

you cannot pass this bill without increasing the SALT deduction cap. How do you envision that deduction changing given the fact that no senator, Republican senator, wants to vote for this? Well, I appreciate that they don't. They all come from red states, right? As do I. And we have very different perspective on SALT than our colleagues in the blue states, for example, in California and in New York and New Jersey.

But that is the reality in the House, remembering, and they have to remember, my Senate friends and colleagues have to remember, I have to deliver 217 votes to get that thing across the line if they modify it. So I had lunch with my Senate friends Tuesday last, two weeks ago, before we passed the bill in the House on that Thursday.

And I encourage them to modify it as little as possible, right? Because I gave a metaphor. I said, my friends, I am crossing the Grand Canyon on a piece of dental floss, okay? The equilibrium that we reached here took quite a bit of time to get to where we are.

And you can't load me up on either side. And if you go and slash the salt cap that we negotiated carefully for over a year, it's going to make it very difficult for me to deliver the necessary number of votes. Remembering I can only lose three in the House. They can only lose three in the Senate to get this done. So we're all working together as one team, House and Senate together, united in this effort.

They understand that, and I think they understand certainly Leader Thune and the leaders over there understand the complexity of what we're having to deal with here. Speaker Johnson, just to sort of put a bow on it, so $40,000 is still likely to remain the cap? That's what we negotiated here, and I'm certainly trying to hold to that number. Look, we've paid for it. I think we've got it worked out in all the math and the legislation, and I think it's something that I know they're not in love with it, but I certainly hope they'll tolerate it so we can maintain our vote tally over here.

Speaker Johnson, as you walk that piece of dental floss over the Grand Canyon, there is this question of how the bill is currently being used, whether it's for budget negotiations and budget reconciliation over the next decade or whether it's to negotiate trade agreements. There is $2.8 trillion of

of revenue that is being penciled in by the Congressional Budget Office from tariffs that might be used as a negotiating tactic, might not be. How do you understand the way that tariffs are looked at as part of this budget balancing act?

Well, it hasn't been included in the calculations and that's because groups like the CBO, the Congressional Budget Office, as you noted, won't give us any credit for that. But it is very real. I mean, the revenue is real and it is realized. And it's not included in the calculation that we've made or they've made, but

Obviously, it's a big factor. We believe that we're going to bring about a roaring economy again. And it's not based on conjecture or groundless optimism. I mean, this is based on the history. We did this in 2017. After the first two years of the Trump administration, when we passed the Tax Cuts and Jobs Act,

We reduced taxes. We reduced regulations. And the economy was roaring. I mean, you all remember before COVID, we had the greatest economy in the history of the world. I mean, everybody was doing better. Every demographic. Wages were up. The job participation numbers were at record highs. Inflation was down and manageable. Things were going great. And then COVID hit. So we're going to do that same series of policies, implement that same philosophy, but this time, as I say, on steroids.

And it's going to make a major difference in everybody's lives. Speaker Johnson, a lot of people in markets are concerned about a number of provisions here and actually don't think they will spur growth. One of them being Section 899, which talks about taxing foreign investment in the United States from specific countries.

that have non-tariff barriers like the VAT tax and other things that have been contentious during negotiations of trade deals. How much do you see that dampening? I mean, is that a concern for you? Because right now, around the world, there are people wondering whether they can still invest in the United States without getting penalized for it. Yes, look.

There's a complexity to the tariff negotiations. I mean, we tip our hat to the White House, and the President's strategy is working. As you know, there's more than 75 countries renegotiating their trade agreements right now, finalizing that even as we speak. That's going to be better for America because it will be more fair. You know, I'm always liking myself to be a Reagan Republican, and free trade is one of our core principles that we've all, you know,

And every time I would say that over the last several years to President Trump, he would say, yes, free and fair trade. And he's right. I mean, this is a disparity that must have needed to be addressed, and it has been. So we think in total this is going to be good when all the dust settles on the tariff negotiations and the new trade agreements. It's going to be good for America and good for the world.

And so we're factoring that in. We're working in tandem with the White House, and it's part of the thought and calculation. Speaker Johnson, just to be clear, that provision will stay in. That is important to you. Look, I think it is. I mean, obviously the bill is still a live instrument that's being worked on in the Senate, so we'll see if they modify those provisions. But I think for now, I think that's good policy for us. And I want to say to foreign investors, you're in good stead to invest in America. This is the time to do it.

because the American economy is about to take off again and it's going to be good for you and good for the world. We're the largest trading partner for most other nations. They need America. And a strong America is good for the whole world. And that is what we are going to bring about with these sound policies and pro-growth initiatives.

Speaker Johnson, you and your colleagues have a self-imposed July 4th deadline. Partially that is because you have to raise the debt ceiling. Are you considering raising the debt limit if this deal isn't finished by July 4th with a different measure?

Well, it would be very difficult to do it. I mean, it would require a bipartisan measure in that regard, and I would like to believe that Chuck Schumer and the Democrats in the Senate would do the right thing, but I wouldn't count on that. That debt cliff, as we're regarding it, is coming soon, and that's why Secretary Besson has said we've got to get this done by Independence Day. And I think it would be a great celebration for all of us. But it's not just because of the debt ceiling.

uh... it's also because we need to get tax relief and uh... in in this new roaring economy to the american people as quickly as possible their old and this is going to be a great thing for everyone in you know i have to also think about the politics of it right we have a midterm election coming up in twenty twenty six if we get this done soon quickly this summer

uh... then then everyone will feel those effects before they have to go vote again and uh... in that midterm election we want to keep the house majority and keep this going for four years for president trump and not to and if we lost the majority there's no doubt that the house democrats would try to impeach the president and and everything would be

truly chaotic for investors and job creators and consumers. So we have to keep this going, keep the momentum going. The timeline is very important and that's why I put this on a very aggressive schedule. I said back in the early part of this year that we would pass the big beautiful bill out of the House

before Memorial Day. People laughed. They mocked me when I said that, but we beat it by four days. We're going to stay on track and we're going to deliver for the American people. Well, you have exactly 29 days to hit that deadline. Are you saying there's no plan B for raising the debt ceiling if this bill is not done between House Republicans and House Senators?

Look, Republicans in the House and Senate will deliver and will take care of our business one way or the other. But I'm just telling you that the smartest and most efficacious way to do this is to stay on the schedule and deliver for the people. And that's what we're doggedly determined to do. We're laser focused on it.

If we take our focus off of that, then the strategy doesn't work. So I'm telling you that we are working on that regard. Leader Thune and I are in constant communication. He understands that deadline as well. The Secretary of the Treasury and the NEC and all the leaders in the White House and the administration understand that. So we're going to get it done. Speaker Johnson, how closely are you watching the bond markets right now, given the fact that we've seen a real sense of concern, particularly in longer-duration U.S. treasuries?

We watch it closely. Look, I really do believe that delivering this historic legislation is going to be critically important for a lot of reasons, not the least of which is that Congress can send a very important signal to the bond markets, to the stock market, to investors everywhere, that we're very serious about this, not only in getting the U.S. economy roaring again, but

but also in addressing the long-term debt. And I think that's an important thing for everyone to understand. We have a strategy that's a multiple steps, as I said, multiple steps strategy to address this over the next year, two years, three years. And we're going to get the U.S. economy back on sound footing. We're the party of fiscal responsibility. And you'll see that demonstrated day after day here. House Speaker Mike Johnson, thank you so much for being with us.

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