Becker Private Equity & Business Podcast
The Government Shutdown, Tariffs, DOGE & More 3-13-25
Thu, 13 Mar 2025
In this episode, Scott Becker discusses the looming government shutdown, the complexities of trade wars and tariffs, and the debate around deficit spending.
Chapter 1: What is the looming government shutdown?
This is Scott Becker with the Becker Private Equity and Business Podcast. Today, we're going to discuss terrorists, Doge, the government shutdown, and a lot more. So here's what we're going to talk about. First, we'll talk about government shutdown. If we actually have a government shutdown, as the Republicans and Democrats play chicken with the budget, This will be a bad thing.
Chapter 2: What are the potential consequences of a government shutdown?
It will cause lots of challenges. It will cause our debt rating to go down. The Moody's Fitch rating will go in the wrong direction. So let's hope the Democrats and Republicans can agree to something. It is challenging.
Chapter 3: How are political parties approaching the government shutdown?
Now you've got the Democrats saying they're willing to shut down the government, where before this, when the Democrats were in charge, it was the Republicans saying that they were willing to shut down the government. And it all boils down to a giant game of chicken. So that's the government shutdown. That's one of the big headwinds we're facing. Let's hope that gets solved versus a disaster.
Chapter 4: What are the complexities of trade wars and tariffs?
Second is the trade wars and tariffs. And I've been so bombarded with so many different thoughts in this last several days that it's taken me some time to get to some conclusions. Thoughts on this. And here are a couple thoughts on this. I don't love how President Trump sort of goes about this in the bombastic way that he does, but it sort of is how he's wired.
Chapter 5: How have trade deficits changed over the last decade?
At the same time, our trade deficits have gone from bad to worse over the last decade or so to record numbers recently. And I do think we need to address it. If we want to have high wages here and everybody wants higher wages here, You can't have that in being importing goods that are made in labor countries that pay 10%, 20% of what we pay. Those just don't work. So if we want high wages here,
Chapter 6: What are the challenges of importing goods from low-wage countries?
We can't find from countries that are both dumping products here and that use wages that wouldn't pay our people, that don't work. So you've got this complicated issue. It's made more complicated. It's explained poorly.
Chapter 7: Why might tariffs be necessary for high wages in the U.S.?
But I do think there's some sense to some of these tariffs, some of these efforts to make our tariffs more reasonable compared to the rest of the world and also to put ourselves in a spot where essentially we can manufacture products here and do products here. If we want high union wages, and all of our unions do, then we better find a way to not be buying things at $3 an hour from overseas.
The math just doesn't work. So am I pro-trade war? No. But do I believe there's some basis for these tariffs, particularly if we want to meet some of the Democratic objectives of higher wages for our people and Republican objectives, then we've got to figure out some way to do that. So that's my thought on the tariffs. The third thing is Doge.
And Doge is really complicated because, again, just like we've got to get great deficits down, we've ultimately got to get our deficit spending down. President Trump, I disagree with so much of what he says, and I agree with so much of what he says. Yesterday he said, we're trying to move from a fake economy to a real economy. I couldn't agree with that sentiment more.
Whether Trump could actually do that or not is a different issue. But when you're using $2 trillion in deficit spending a year to inflate the economy, and that money is going to all kinds of special interest, it is just despicable behavior and does give us an artificially inflated growth. Like we've said many times over the years,
if you're using debt at eight percent but you've actually got a essentially growth at two or three percent well you've really screwed the pooch so this concept and whether doge will actually do this or not whether it's all smoke or mirrors or not i am totally on board with the need for doge or something like it and as i listen to all the noise around this and how many political footballs are are at play
I am coming to the conclusion that the only way to do this might be the wrecking ball approach that Elon Musk and team are taking. So I am becoming a little bit more positive towards what's going on with Doge and the trade wars than I was some time ago. Obviously, it's disconcerting all this stuff. You know, those are the three big things. You know, the government shutdown. Doge and tariffs.
We could also talk about inflation. We could talk about a lot of other things. But I think that's probably enough to leave people with right now. What a fascinating situation. I mean, certainly President Trump is bombastic as hell. But this Doge thing is so needed. You can't live with $2 trillion deficits. My family was doing that. $100 deficits, we'd be broke.
If the country's doing it, we're going to go broke. If a company was doing it, they'd go broke. It just doesn't work in the long run. So we've got to deal with it. You know, there's people that say, oh, the billionaires should just pay more taxes. They are a spit in the bucket compared to how much money we are spending in deficit spending. You could tax all you want to the billionaires.
That doesn't even make a dent, so we've got to figure out a way to cut spending and probably raise taxes some. I don't disagree with that, but you've got to do a little bit of both. In any event, thank you for listening.
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