All-In with Chamath, Jason, Sacks & Friedberg
Senator Ron Johnson on the Senate showdown over Trump's Big Beautiful Bill | All-In Interview
Sun, 25 May 2025
(0:00) Friedberg and Chamath welcome Senator Ron Johnson (2:30) The Reconciliation Bill process, how much the Big, Beautiful Bill will add to the national debt (14:33) Problems with growing our way out of debt, why elected officials are avoiding the fiscal reality (24:53) Energy rescissions, future of DOGE (32:09) How Senator Johnson will force a real review of the Big, Beautiful Bill; future of MAGA and the Conservative movement (54:15) Next steps if the Big, Beautiful Bill passes (58:35) Post-interview recap Follow Senator Johnson: https://x.com/RonJohnsonWI Follow the besties: https://x.com/chamath https://x.com/Jason https://x.com/DavidSacks https://x.com/friedberg Follow on X: https://x.com/theallinpod Follow on Instagram: https://www.instagram.com/theallinpod Follow on TikTok: https://www.tiktok.com/@theallinpod Follow on LinkedIn: https://www.linkedin.com/company/allinpod Intro Music Credit: https://rb.gy/tppkzl https://x.com/yung_spielburg Intro Video Credit: https://x.com/TheZachEffect
Chapter 1: What is the main topic of this episode?
Power corrupts. Government is power, and it's been corrupt. Nobody knew in total how much we spend because we never even talk about it. The first goal of this Republican budget reconciliation should be don't add to the deficit. I voted for President Trump. because I wanted him to defeat the deep state. You don't defeat the deep state by continuing to fund it at Biden's levels.
Our base is going to go, why did we elect you guys? You're really no better than Democrats. I don't think President Trump, he's not focused on reducing spending. This is our one opportunity. And right now we're blowing and I'm going to do everything I can to make sure we don't blow it. I can't be pressured by President Trump.
Chapter 2: What are the implications of the Reconciliation Bill on national debt?
He's willing to sit down with me, look at the numbers, acknowledge them, working forward in a reasonable plan forward. That's the only way he's going to get my support.
So everyone has assumed that the House passage of the reconciliation bill is going to go to the Senate with some minor changes and then make its way to President Trump's desk for signing.
but that may not be the case there are several hardliners in the u.s senate who have made it very clear that the budget and the fiscal deficit problems that arise from this bill are insurmountable and they're going to take a very hard stance on voting no on this bill taking the lead on that point of view senator johnson from wisconsin who's going to join us today for an emergency pod to talk about what's next with the senate review of the reconciliation bill what his thoughts are what's the future of the republic and what's ahead
We're really excited for this emergency pod. Thank you for joining us.
Senator, thanks for joining Chamath and I for this conversation this morning. Good morning, guys, and thanks for having me on.
And just by way of background, Senator, you were elected to the U.S. Senate in 2010. You've had two reelections since then. More recently, we've taken notice, and I gave a shout out to you for your comments on the scaling of the deficit and the U.S. federal debt. And as a Republican, against the stated intention of getting this bill passed and through the Senate, as is.
And we'd love to kind of hear from you today about your points of view on the bill that was passed in the House this week, the reconciliation bill, and then take a step back and talk a little bit about the fiscal picture for the United States and where things are headed. So thanks for that. And thanks for joining us.
Maybe we could just start a little bit with a very basic primer for our audience, something that we don't talk about very much on the show. Can you just tell us what a reconciliation bill is and how it's used so folks can understand a little bit about the process that the House just undertook and what's ahead?
Let me start. You talked about when I first ran for election in 2010, I ran out of the Tea Party, never had been involved in politics whatsoever, and didn't even decide to run until the end of April, announced in May, started a campaign during the summer, did all those parades. What I would shout during the parades was, this is a fight for freedom. We're mortgaging our children's future.
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Chapter 3: Why are elected officials avoiding fiscal reality?
That's one of the ways the budget has gotten completely out of control is we put so many things into the mandatory category. You know, initially it was entitled Social Security, Medicare, Medicaid, but we have, I would say, deeply slid all kinds of discretionary spending into other mandatory that really exploded during COVID, where I think other mandatory hit well over $2 trillion.
Last fiscal year is about $1.3 trillion. This year will be over a trillion. So it went from about $642 billion in 2019, other mandatory, again, not Social Security, Medicare, even Medicaid, Went from 642 to last year, 1.3. This year, it's going to be over a trillion dollars and it's going to keep pretty much at that level as far as the eye can see.
So again, that's a trillion dollars of other non-entitlement spending that we never looked at. And that's the whole point about mandatory spending. It's never looked at. So anyway, so we can address mandatory spending, not Social Security, through this reconciliation process, change programs, do whatever we want to do, as long as it has a primarily budgetary impact, not changing policy.
So you can change policy as long as it has a budgetary impact. I know that's reasonably complex, but it's an insane system and it doesn't work.
What is the alternative?
Well, right now we don't really have them. Again, let's just go through why we've never had a process to control spending. We don't have a balanced budget requirement like states do. And we have the capability of printing money, which we're doing, incurring this enormous debt. So we don't have a balanced budget requirement. I didn't realize this until just recently.
The appropriation committees were literally set up because the authorized committees were big spenders. So they set up appropriation committees to control spending. That didn't work. The Budget Act didn't work. Simpson-Bowles didn't work. The Budget Control Act didn't work. It did restrain discretionary spending for a couple of years until we wheezed our way around.
So again, we've never had a process to control spending. And one of the things I've been arguing in some Wall Street Journal columns is let's use the example of Doge. I come with the private sector. We probably spent more time reviewing my line by line budget for my business.
And I think other private sector businesses spend more time analyzing what they're going to spend than Congress spends over the entire federal budget. So we've got to develop a process. Doge has shown us how to do it. Go contract by contract. Expose the grotesque waste, fraud, and abuse. But we've got to do that through thousands of lines through the federal budget. But nobody's willing to do it.
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Chapter 4: What role does energy play in the future of our economy?
$1.5 trillion sounds like a lot, but over 10 years, it's $150 billion against a $7,000 billion a year budget that only six years ago was $4,400 billion. If I've got one complaint in terms of the process in the House, It's basically a void of reality.
We're not talking about the numbers we should be talking about, which is a 10-year deficit projected by CBO of $22 trillion, averaging $2.2 trillion a year. We don't talk about it. Instead, we focus all on $1.5 trillion, and then they're patting themselves on the back that they didn't even achieve $1.5 trillion.
I just want to make sure, Senator, then, that we're on the same page with respect to the math. If this bill passes as is, Can the general public take the 33 or 34 trillion that we have in debt? Should we add 22 and say we'll be at 58 trillion by 2035? Is that the right math or the wrong math?
That understates it. Now, they'll talk about dynamic scoring, and I believe in dynamic scoring as well. But in this case, if you take a look at the tax cuts that President Trump is proposing, they're not going to generate growth. They're just going to reduce the deficit. The CBO projection I'm looking at assumes we're going to gain another $4 trillion from increasing taxes.
So again, we may not get that $4 trillion, but no matter what, the CBO projection right now that is adding another $22 trillion to our debt, it certainly would add at least that. I would argue it'd probably add another $3 or $4 trillion. So it's not going to be $59 trillion. It's going to be more like $62, $63 trillion.
And the CBO scores assume the interest rate on the federal debt, I believe, is an average of 3.6%. And now we're seeing the 30-year trading above 5%, meaning that if we trade up to 5% for the cost of debt for the federal government, we're probably going to add another $5 trillion of incremental interest expense over the period, another half trillion a year on average over the next 10 years.
And I would agree the current CBO projection, that's what I'm talking about here, You know, going from 37 to 59 trillion dollars in debt is a rosy is, you know, the rosy scenario that that's as good as we're going to do. So we're simply we're simply this does not mean the moment in terms of what we have to do.
Senator, let me just ask. I think one point of clarification on your earlier comment, which I think would be important for the audience, what has been put under mandatory that should be discretionary?
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Chapter 5: How will Senator Johnson challenge the Big Beautiful Bill?
It covers the entire gamut of federal spending, education, welfare, food stamps, veterans benefits. Again, they've just transferred that into mandatory spending. So it's completely... out of sight, out of mind, and unaccountable.
When it sits in discretionary, maybe just help folks understand, what does it mean if it sits in discretionary? Does that mean that then the administration under the president has the authority to spend up to that amount to administer the law, to administer the statutes, but doesn't necessarily have to, and the mandatory demands that the capital goes out?
Just help us understand for the audience what the difference is.
Well, discretionary is actually supposedly passed each year through an appropriation process, which is completely broken. We don't pass individual appropriation bills. We generally at best, which is awful, minibuses or omnibuses. These are these multi-thousand page bills. bills that get dropped on our desk and we have to vote on them literally within 24 to 48 hours. Nobody reads them.
Nobody knows what's in them. That process is pretty broken down right now. We are operating for this fiscal year under a continuing resolution, which tweaks a few things, but it's basically spending at last year's levels on all those appropriated accounts. So again, that's about 25% of our budget. Then 75% is in the mandatory accounts, the entitlements and just other mandatory spending.
So the arithmetic indicates we're entering into a debt-death spiral in the United States with the interest rates climbing, the deficit climbing, and we then need to spend more money to pay our interest on the existing debt. That increases the deficit. We need to borrow more. The debt spirals up. Interest rates climb, and this becomes an insurmountable hill to climb.
As you have the conversation with members of the Republican Party, what's the point of view? What is the motivating factor for business as usual? Why is it so difficult to get folks to see the basic arithmetic in front of them?
Well, let me give you an example from about three years ago. This was after COVID, and bipartisan bases were on a massive spending spree in 2020, but then the Biden administration just continued that. So, you know, we were in omnibus spending debate. And for the first time, even though the Republican Senate conference, we have a resolution against earmarks.
McConnell is negotiating an omnibus spending bill. And all of a sudden, members are sucking down earmarks. So I asked my colleagues at that time, I said, hey, anybody know how much in total we spent last year in the federal government? Room was dead silent. I went out to Washington Press Corps, asked the same question. Hey, anybody know how much we spent last year?
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Chapter 6: What happens if the Big Beautiful Bill gets passed?
So I tried to lay out the basic numbers. That's what I was talking about. You know, my pre-pandemic levels of spending, Clinton, if you use that process, go from 1.7 to 5.5 trillion. That's how you plus up that spending. Obama would be 6.2, Trump's 2019, 6.5. So now you've got a baseline budget.
You've always heard these Republican members of Congress running for office saying we're going to go to zero-based budgeting. They're not even willing to go to 5.5 to 6.5 level baseline of budget. Again, what is the process that just might work? Doge has kind of shown it to us. Line by line, you have to scrutinize all this. It takes a lot of work. It takes a lot of time.
And that's why I've always argued for a multiple approach here, multiple step. Provide the border funding. I would just extend current tax law. I mean, I would have voted for that if we had been smart enough to use current policy back then. We wouldn't be even having this conversation. Extend current tax law takes an automatic massive tax increase off the table.
Increase the debt ceiling enough for a year to keep pressure on the process to do the work. To go line by line, expose spending. I've got to believe, when you've gone from $4,400 billion to $7,000 billion worth of spending, if you start scrutinizing that line by line, there would literally be hundreds of billions of dollars that the public wouldn't even know were not spending.
Chapter 7: What should we expect after the interview?
The only people who would know would be the grifters who are sucking down the pork.
Mm-hmm.
So when you say the folks in the Republican Party that aren't willing to do the hard work, it's just so obvious how big of a crisis we are in and everyone's kind of being blind to it. So I'm just trying to understand what is it that's keeping the blindfold on? Is it that there are donors, that there are constituents? I'll give you an example. A couple of years ago, I went in for the farm bill.
review with the Senate Ag Committee 2012, so a long time ago. And we started talking about one of the agencies in the USDA, and they have 10,000 employees, and said, why does this make sense in a digital age? And the answer was it doesn't. It's like, well, why is the agency still running and employing all these people?
Well, because the senators don't want to lose the jobs in their state, because that's 10,000 jobs split amongst roughly seven states, and it's really important to those seven states to keep those jobs. Is that the motivation that there's economic dollars flowing into the states that keeps the representatives and the senators from making the tough decisions?
Is it that they're getting donor dollars? What's the real motivation here that's keeping everyone from tackling reality?
Well, again, as I pointed out, Most don't even recognize the full reality. They don't know the numbers. I've heard it said, I didn't hear McConnell say it personally, but I've heard him say, show me a member of Congress who ever lost the election because they spent too much money. So there's no public pressure not to spend. People love tax cuts. People love the free money.
We collectively as a society are whistling by the graveyard. Nobody wants to say that this is unsustainable because to fix it is painful. I mean, you are going to have to reduce spending. And then you're very open to the political accusations as, you know, coming in. We're trying to slash Medicaid for disabled children.
Now we're trying to preserve it for disabled children, try and get the able bodied, childless children. working age adults back to work and on private sector healthcare. But again, that's a more difficult argument to make. So it's just the way that the process just plows on. We've never, as I said, there's never been a process to actually control spending. So this is what we've always done.
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