Treasury Secretary Steven Mnuchin joins Chris Wallace on ‘FOX News Sunday’ and defended President Donald Trump’s executive orders to defer payroll taxes and replace an expired unemployment benefit.
CHRIS WALLACE, ‘FOX NEWS SUNDAY’ HOST: White House negotiators and Democratic congressional leaders met 11 times to discuss the coronavirus relief package before President Trump took his executive action yesterday. Joining us now from the White House, Treasury Secretary Steven Mnuchin. Mr. Secretary, welcome back to FOX NEWS SUNDAY. STEVEN MNUCHIN, TREASURY SECRETARY: Thank you, Chris, it’s good to be with you. WALLACE: You just heard Speaker Pelosi’s reaction to the steps that President Trump took yesterday. Your response? MNUCHIN: Well, first of all, let me just say, it was the president’s first choice for us to go up and negotiate a fair deal. So Mark Meadows and I negotiated nonstop. We went through every single line item with them for two weeks. Let me just give you a sense of this. On education, they wanted $100 billion. We agreed to $105 billion. They then raised their number to 400 billion. As the speaker just said, they wanted money for food, we compromised on food. We actually reached an agreement on that. We had the postmaster general up. We compromised — WALLACE: Well, wait, wait, let me ask you about — Mr. Secretary, let me just ask you about that because she kept referring to $250,000 for food relief. Is that true? MNUCHIN: No, we came up to a very fair compromise. We actually reached an agreement on what they wanted without long-term changes on policy and we knocked that off the list. But let me just tell you what they’ve refused to negotiate on. We said, tell us you are on a compromise or state and local. They said, we’re at a trillion dollars. We said, tell us where you are on enhanced unemployment. We told the American people we’ll keep it at 600 while we negotiate for a week or two. They refused to do that. Those two issues, they’ve refused any compromise on mostly every single other issue we’ve reached in agreement. And what happened on Friday was, they say, well, call us back. We said to the president, look, now you’ve got to move forward with an executive action so that you can help American workers and American people. WALLACE: But, Mr. Secretary, let’s talk about what the president’s actions that he took yesterday, and we’ve talked about they did, let’s talk about what they don’t do. They don’t provide another $1,200 direct payment to people. They don’t restore the Payroll Protection Program, which helps small businesses. That ran out yesterday. Here’s what Democrats said during the negotiations. (BEGIN VIDEO CLIP) SEN. CHUCK SCHUMER (D-NY): There are real needs. American knows they have needs. The public is on our side. But they seem not to be willing to go in a direction that would meet those needs. REP. NANCY PELOSI (D-CA): It’s hard when your values are so different in terms of bubble up from the working class families instead of trickle down from above. (END VIDEO CLIP) WALLACE: Mr. Secretary, you heard Speaker Pelosi say she would like to resume talks. Are you ready to do so? And, frankly, given these differences in what you heard from her today, why should we think that negotiations this week would go any better than the failed negotiations of the last two weeks? MNUCHIN: Well, Chris, I’ve told the speaker and Senator Schumer, any time they have a new proposal, I’m willing to listen. But let me just say, you’re right, we agreed with the Democrats. We both want to send more checks to the American workers. We want to send more PPP to those hardest hit businesses. We’ve said, let’s pass legislation on the things that we agree on and knock these off one at a time. And they’ve refused to do that until they get their trillion dollars for the states. I’ve also spoke to many governors over the last few days. We offered more money for the states. They still have 150 billion from last time. Oust of them haven’t even used half the money. The governors are saying, we need more money for education. We need help. And the president said, we’ll give it to you, but not a trillion dollars. WALLACE: Mr. Secretary, I want to refer to something that — that Speaker Pelosi reference, and that was the comment from Republican Senator Ben Sasse that this governing by executive action is, his words, unconstitutional slop. What makes you think that spending over $100 billion that Congress has not appropriated for these specific purposes is legal, and what happens if there’s a court suit and all of the actions that the president took yesterday are blocked by a federal court? MNUCHIN: Well, Chris, let me just say, we’ve cleared with the Office of Legal Counsel all these actions before they went to the president. The president knew unemployment insurance was ending. He said, let’s continue at $400. By the way, the 25 percent from the states, they can either take that out of the money we’ve already given them or the president can waive that. We’ve been told by the states they can get this up and running immediately. And I would say, if the Democrats want to challenge us in court and hold up unemployment benefits to those hardworking Americans that are out of a job because of Covid, they’re going to have a lot of explaining to do. WALLACE: As we say, you have cut the federal unemployment benefit from $600 to $400, $300 from the feds. $100 — this is a week, $100 from states, but you say a lot of that would come from federal money they’ve already received. Do you really think that the — that the hundreds of millions of — that the millions of families that lost jobs because of the virus don’t need that money, that they don’t need the extra $200 a week? MNUCHIN: Chris, let me be clear, first of all, on the 25 percent, that’s coming from money we already gave the states. So this is effectively 100 percent paid for by the federal government. Let me also remind you that Obama, during the financial crisis, paid a $25 top up. So this has never been done in the history of time. We thought $400 was a fair compromise. But let me just also say, we offered to continue to pay $600 while we negotiate and the Democrats turned that down. So the president had to act. WALLACE: But, wait, sir, that was — that was only for one week. That was only for one week. MNUCHIN: Actually, Chris, we extended it to two weeks. But they made perfectly clear they’re not going to agree on a piecemeal deal. They want to hold up the American public from getting the money they need until they get everything they want, which is just a bad outcome, as I said. WALLACE: All right, let — let — let’s talk about another issue, and that is the suspension of payroll taxes, which even a number of Republican senators opposed. There — two issues there seem to be here. First of all, suspending payroll taxes doesn’t help the — the millions of people who are out of jobs and don’t have to pay payroll taxes, so they don’t get a benefit there. And it’s also not a payroll tax cut, it’s a payroll tax suspension. Isn’t there a danger that a lot of businesses won’t pass this — these savings through to workers because they’re going to hold onto the money inasmuch as, at some point, according to this executive action by the end of the year, those payroll taxes are going to have to be paid anyway? MNUCHIN: Well, Chris, we — the president wanted to do a payroll tax cut. We could do the payroll tax deferral. He’s going to go to the American people and tell them that when he’s reelected he — he will push through legislation to forgive that. So, in essence, it will turn into a payroll tax cut. But let me just also say, for the hardworking people that don’t have jobs, that’s what we’ve extended the $400. What we should be doing is let’s pass legislation on 70 or 80 percent of the things that we agree on so we can get money immediately to the American public. Schools need to reopen safely. I’ve spoken to many of the governors, both Democrats and Republicans. They need this money. We have more than enough money to give it to them. And they’re — the — the speaker is holding that up. WALLACE: I want to pick up on what you just said, that if the president’s reelected he would like to cut the payroll tax. The payroll tax is what finances Social Security. The payroll tax is what finances Medicare. Democrats are now saying, if President Trump is re-elected, he’s going to gut those programs because he’s going to gut the tax that pays for them. MNUCHIN: Chris, that’s not the case. There would be an automatic contribution from the general fund to those trust funds. The president, in no way, wants to harm those trust funds. So they’d be reimbursed just as they’ve always been in the past when we’ve done these types of things. WALLACE: So — so you’re saying that there would be no payroll tax cut. There would be an income tax — what, increase, because we’re all running – – already running huge deficits. So how are you going to pay for it from the general fund? MNUCHIN: No, no — Chris — Chris, there’s a payroll tax cut, which is like any other tax cut to hardworking Americans. And you just have a transfer from the general fund. So during fiscal times, we’re — we’re focused on tax cuts, regulatory relief, direct payments to Americans. We’ll deal with the — the — the budget deficit when we get the economy back to where it was before. Right now we’re focused on delivering very needed relief to American families that been — have been impacted by this terrible Covid economic issue. WALLACE: I — just to be clear here, though, the Democrats are saying the result of a payroll tax cut is it would mean a cut in benefits for Social Security and Medicare, to which you say — MNUCHIN: That’s just factually inaccurate. There would be no reduction to those benefits. And the president’s made that very clear. But the issue here is, let’s pass legislation on things that we agree on. Let’s not hold up money to education for kids getting back to — to school safely. Let’s not hold up money to state and local governments where they need it. The Democrats have to come off of a ridiculous trillion dollar number to state and local governments to bail out some of the states that were poorly managed. WALLACE: Well, let me just ask briefly on — on that, they’re talking 900 billion, not quite a trillion, but $900 billion. You’re talking $150 billion. Is there a place in between there for aid to states and cities? MNUCHIN: Chris, they’re actually asking for 915 plus the reversal of SALT, which get you over to a trillion. But, on us, we gave 150 in the last bill. We’ll give another 150 billion more. We can deal with in January, if there’s ongoing issues, we can pass more legislation. This will be the fifth bill. We don’t have to get everything done at once. What we should do is get things done for the American public now, come back for another bill afterwards. WALLACE: All right, I’ve got about a minute left and I got a big question and I’m going to count on you to give me a quick answer. Let’s turn to the economy and the latest jobs numbers. Let’s put them up on the screen. In May, we added 2.8 million jobs. We added 4.8 million in June. But in July, only 1.8 million. That’s still — so, clearly, the job creation is slowing down and that’s still less than half of the jobs that were lost in March and April. Now we see a resurgence of the virus, a spike in the virus and parts of the country. Reopenings are slowing down or even stopping. Isn’t the vitality of this recovery being threatened? Isn’t the v-shaped turning into some other letter of the alphabet? MNUCHIN: Chris, as you know, we literally shut down the U.S. economy. We’re bringing back jobs. We brought back a lot. The president’s work’s not done until we get all the jobs back and that’s what he wants to continue to send money to the American public so this economy comes back and everybody gets their jobs back. WALLACE: Mr. Secretary, thank you. Thanks for joining us. You’re always welcome here, sir.