How will we ever get the national debt under control? Just asking questions.

The U.S. national debt stands at a staggering $36 trillion. And while President Donald Trump assures us he's a "fiscal hawk," the GOP's latest fiscal plan, dubbed the One Big Beautiful Bill Act, is a fiscal time bomb, says today's guest. David Stockman, the director of the Office of Management and Budget under President Ronald Reagan, joins the show to dissect the Trump administration's budget priorities and explain why tax cuts without spending reductions are a recipe for disaster. With a career spanning decades in Washington, including his role as a key architect of Reagan's economic policies, Stockman brings unmatched insight into the mechanics of federal budgeting and the political roadblocks to fiscal sanity.

Mentioned in the podcast

The One Big, Beautiful Bill Act

Federal spending data, by the U.S. Treasury

"Preliminary Analysis of the Distributional Effects of the One Big Beautiful Bill Act," by the Congressional Budget Office

"CBO's First Score of House Reconciliation Bill," by the Committee for a Responsible Federal Budget

The Triumph of Politics: Why the Reagan Revolution Failed, by David Stockman

Deficit by gross domestic product for the past 50 years, by the Congressional Budget Office

CSPAN on X: President Trump on @RepThomasMassie: "I don't think Thomas Massie understands government. I think he's a grand-stander, frankly…I think he should be voted out of office."

Chapters

• 00:29 Introduction and national debt overview


• 06:01 Analyzing the One Big Beautiful Bill Act


• 10:23 Tax cuts and deficit spending challenges


• 18:28 Supply-side economics and Reagan's legacy


• 27:33 The Federal Reserve's role in debt monetization


• 40:03 Consequences of a potential debt crisis


• 49:41 Political dynamics and opposition to Trump


• 56:45 Strategies for fiscal reform and recommendations by the Department of Government Efficiency


• 01:02:30 Lessons from past budget surpluses


• 01:07:43 Closing thoughts and the free lunch myth

Transcript:

This is an AI-generated transcript. Check against the original before quoting.

Zach Weissmueller: How will we ever get the national debt under control? Just Asking Questions. David Stockman has more insight into this question than just about anyone we can think of. He was the budget chief for Ronald Reagan, so he understands both the mechanics of the federal budget and the real-world politics that make cutting spending extremely difficult. 

We're delighted to have him here with us today to dissect the Trump budget—known as the One Big Beautiful Bill Act—to lay out the potentially dire consequences of uncontrolled deficit spending and to offer lessons from the Reagan Revolution, which in his telling failed to deliver the smaller and more responsible government that it had promised. David Stockman, thanks for coming back on the show.

David Stockman: It's great to be with you, and there's certainly a lot to talk about here. Here we are 40-years later, and I think we're in a far deeper pickle—let's say, dilemma—even catastrophe, than we thought we were battling in 1980. So there are a lot of things to talk about.  There are a lot of lessons to be learned. Hopefully there are ways out of this, but it's looking increasingly bleak to me when we have a Republican Party with a mandate—really, for the first time—all three branches: the White House, the Senate, and the House. Albeit by slim majorities, but still, they have a majority for the first time in a long time.

Are faced with $36 trillion of existing public debt, which is out of control. and a budget that has built in $22 trillion of additional debt over the coming 10-year horizon, which is kind of the budgeting time frame that we work with. So you would think that the conservative party—the Republican Party, which at least historically had some pretty firm commitment to fiscal rectitude—would look at that $22 trillion and say, "Our job is to shrink it, to cut it, to reduce it and minimize any further growth in the $36 trillion we already have."

But instead, they've done the opposite. They've basically said, like they're at the gambling table, "We'll see your $22 trillion that's built in, and we're going to add $3 - 5 trillion more," depending on how you count the numbers. The Republican Party was supposed to be the party that defended the taxpayers and the free market and the private economy and society, and yet they can't even muster a single dime of net spending cuts over the next decade.

They've set aside so many large parts of the budget that it is kind of ridiculous when you say—as Trump and the Republican leadership have said—Social Security is off limits, Medicare is off limits, veterans benefits, which are like $350 billion a year and growing rapidly, are off limits, the defense budget—which is now pegged at $1 trillion—is off limits. And of course, we have to pay the interest on the debt, which is now also $1 trillion a year.

So if you put all that stuff together, you're talking about 75 percent of the budget or more that they put off limits.

Zach Weissmueller: Just so people can see the visuals here of government spending by category, laid out here by the Treasury Department—you can see there Social Security, this is for fiscal year 2025—Social Security is at the top. Then interest—half a trillion dollars just in interest—and then health, Medicare, national defense, and income security. And so—

David Stockman: And while we're all looking at this here, go down one more and you've got veterans benefits and services. So by the time you get through all of those bars, you're down to the little tiny microscopic bars at the bottom to find any spending cuts. But then you get to transportation, for instance, and if you can strain your eyeballs, here at $77 billion—well, a good share of that is the highway trust, the interstate highway system, which at least gas taxes allegedly pay for, in spending. So they're not going to shut down highway construction and the interstate highway program.

What I'm trying to get at here is, if you just look at this chart, you realize they're painting themselves into a corner that's so tiny that it's not serious. They're basically faking it. The Republican Party has become a pretty sad sack of fakers when it comes to what their job is. Remember, the Democrat Party is the government party. The Republican Party is for the taxpayer and for private life and private enterprise. And if the taxpayer—pro-taxpayer—party, at least in theory, is throwing in the towel, we're in big trouble.

Zach Weissmueller: I want to look a little more into the details of the One Big Beautiful Bill and what it is that's driving this increasing deficit spending. I believe you said you think that it might add up to $30 trillion over the next decade. 

David Stockman: H