[Transcript] KRISTEN WELKER: Welcome back. There are new economic warnings after the credit ratings agency, Moody’s, downgraded the United States’ credit rating one notch from its AAA rating. Moody’s citing concerns over the nation’s rising debt. It comes as President Trump’s tax bill suffered a setback in Congress this past week. Joining me now is Treasury Secretary Scott Bessent. Secretary Bessent, welcome back to Meet the Press.
SEC. SCOTT BESSENT: Kristen, good to see you. Thanks for having me on.
KRISTEN WELKER: It’s wonderful to have you on after a long foreign trip. Thank you for being here. Let’s start right there with Moody’s downgrading the nation’s credit rating. And they do cite the debt. I want to read you a little bit of what Moody’s says. It says, quote, “If the 2017 Tax Cuts and Jobs Act is extended, which is our base case, it will add around $4 trillion to the deficit over the next decade.” Several Republicans, Mr. Secretary, are citing similar concerns. Does the president’s tax bill need to do more to address the nation’s debt and deficit?
SEC. SCOTT BESSENT: Well, Kristen, first – first of all, I – I think that Moody’s is a lagging indicator. I think that’s what everyone thinks of credit agencies. Larry Summers and I don’t agree on everything, but he said that’s when they – they downgraded the U.S. in 2011. So it’s – it’s a lagging indicator. And just like Sean Duffy said with our air traffic control system, we didn’t get here in the – in the past 100 days. It’s the Biden administration and the spending that we have – have seen over the past four years. We inherited 6.7% deficit to GDP, the highest when we weren’t in a recession, not in a war. And we are determined to bring the spending down and grow the economy.
KRISTEN WELKER:
Fair enough. But under President Trump’s first administration he added $8 trillion to the nation’s debt in his first term. So there’s plenty of blame to go around. Let me –
SEC. SCOTT BESSENT:
No, no, no, no, no. But let’s review. We were in the rescue portion of Covid. The Biden – the Biden administration was in the recovery portion. And Kristen, it would’ve been if not for Senators Manchin and Sinema, who are no longer the – in the Democratic caucus, that it would’ve been $4 trillion or $5 trillion more.
KRISTEN WELKER:
It did include the – the tax cuts as well. But let me ask you about Walmart, this big news from Walmart. It says it will start raising prices on its consumers, Mr. Secretary, as early as this month due to the tariffs. Now, President Trump out with a very stern warning on social media saying Walmart, quote, “should eat the tariffs,” adding the company made far more than expected last year. Is the president asking American companies to be less profitable?
SEC. SCOTT BESSENT:
I – I was on the phone with Doug McMillon, the CEO of Walmart, yesterday. And Walmart is in fact, going to, as you describe it, eat some of the tariffs, that – just as they did in ’18, ’19, and ’20. The other thing, though, that we are seeing that Doug passed along to me, that with their consumers, the single most important thing is the gasoline price. Gasoline prices have collapsed under President Trump. So we – we are seeing that. The other thing that will happen, that is a direct tax cut for consumers. Then the transportation costs are also a big input. So let’s see what happens. What you’re describing was Walmart’s earnings call. The other thing the companies have to do, they have to give the worst case scenario so that they’re not sued. So you know, I – I think overall we are seeing a decline in services, inflation, and I – and we saw inflation come down for the first time in four years.
KRISTEN WELKER:
Well, you know, in my conversation with former Vice President Mike Pence, he says he sees tariffs as a tax. How far, Mr. Secretary, is the president, is the administration willing to go to prevent CEOs from increasing prices?
SEC. SCOTT BESSENT:
Well, I – I think what we are hearing here is tax – people are saying tax increases are inflationary that – when I was testifying before Congress last week, one of the congressmen said that. And I said, “Well, Congressman, if taxes are inflationary, let’s cut taxes.” So let’s get this tax bill done, bring down taxes, which according to this line of thinking, should be disinflationary.
KRISTEN WELKER:
But the Federal Reserve has said that tariffs are inflationary. Just to be very clear, you said you called Walmart. Is that what CEOs can expect, that you, that the president, that other members of the administration will apply pressure to try to prevent them from passing on these prices to CEOs?
SEC. SCOTT BESSENT:
I – I didn’t apply any pressure. The – the – Doug and I have a very good relationship, so I just wanted to hear it from him rather than – than second, third-hand from the press. And again, as I said, this is all from their earnings call. And on an earnings call, you have to give the – the worst case scenario. Kristen, to go back to what you said, the Federal Reserve is not saying that tariffs will cause inflation. They’re saying they’re not sure, and that they’re in wait and see mode.
KRISTEN WELKER:
Let’s talk about the other big news that you were a part of a week ago in Switzerland, negotiating with China’s officials. You and the administration lowered tariffs from the high rate of 145% to 30% for 90 days, to allow talks to continue. But President Trump had said previously, and I’m quoting from him, “China needs to make a deal with the U.S. We don’t have to make a deal with them.” So why did the United States back down?
SEC. SCOTT BESSENT:
Neither side backed down. Both sides realized that this, as I had said, the – was unsustainable. So we had the equivalent of an embargo, which is not what either side wanted. You know, it was this constant tit-for-tat escalation. So both sides brought the tariffs down by 115%. So for 2025, we have increased tariffs on China by 30%, they have increased them by 10% on us. We now have a mechanism in place to continue talks.
KRISTEN WELKER:
Okay. On Friday, as a piece of this, President Trump, while he was on the foreign trip, said that countries should expect letters from you, from Secretary Lutnick, saying this is what the tariff rate is going to be. Mr. Secretary, does that effectively mean that these negotiations with other countries are over? And how high should they expect tariffs to go? Above 10%?
SEC. SCOTT BESSENT:
This means that they’re not negotiating in good faith. They are going to get a letter the – saying, “Here – here is the rate.” So I would expect that everyone would come and negotiate in good faith.
KRISTEN WELKER:
You expect that rate, though, that you would slap on any country that you think is not negotiating in good faith to be above 10%?
SEC. SCOTT BESSENT:
Well, I think that it would be the April 2nd level. Some countries were at 10%, some were substantially higher. And the negotiating leverage that President Trump is talking about here is if you don’t want to negotiate then it will spring back to the April 2nd level.
KRISTEN WELKER:
I have to ask you about the war in Ukraine. President Trump saying he is going to speak with President Zelensky and Putin on Monday. Former Vice President Pence told me, “It is time to impose harsh sanctions now.” What say you, Mr. Secretary: is it time to impose sanctions against Russia?
SEC. SCOTT BESSENT:
Well, I think we will see the – what happens when both sides get to the table. President Trump has made it very clear that if President Putin does not negotiate in good faith that the United States will not hesitate to up the Russia sanctions along with our European partners. What I can tell you is the sanctions were very ineffective during the Biden administration because they kept them low because they were afraid of pushing up domestic oil prices.
KRISTEN WELKER:
Very quickly, how long for the timeline until you move to sanctions? Obviously there’s a call. But if the president doesn’t feel like there’s progress how much time is he going to give them?
SEC. SCOTT BESSENT:
I – I – look, I – I’m not going to tie the president’s hands in his negotiations.
KRISTEN WELKER:
Let me ask you, former Vice President Mike Pence echoed several of President Trump’s, quite frankly, own allies in expressing concerns about this plane that Qatar has offered to President Trump. They are saying it sends the wrong message. It sends the wrong message and raises concerns ethically, raises concerns constitutionally and about security. Why is it appropriate for the president to accept a $400 million jet from Qatar?
SEC. SCOTT BESSENT:
Well, it’s not the president accepting it, it would be the United States government. And Senator Mullin said this weekend that the talks had actually begun under the Biden administration. So – but Kristen, what I can tell you is I think this is an off-ramp for many in the media not to acknowledge what an incredible trip this was. You know, President Trump has brought back trillions of investments in the United States. Every stop we made, the – the enthusiasm in – in Saudi Arabia, in Qatar, in the United Arab – Arab Emirates to invest in the United States that they want to push more and more, they have funds here. And if we go back to your initial question on the Moody’s downgrade, who cares? Qatar doesn’t. Saudi doesn’t. UAE doesn’t. They’re all pushing money in. They’ve made ten-year investment plans. So this administration, we’re doing peace deals, trade deals and tax deals.
KRISTEN WELKER:
And just very, very quickly, President Trump has said he plans to keep that plane in his presidential library after. But what do you say to some Republicans who argue it sends a message that the United States can be bought, or that other countries can curry favor if they offer gifts?
SEC. SCOTT BESSENT: I say that the gifts are to the American people. These trillions of dollars of investments that are going to create jobs in the U.S., whether it’s the UAE building this gigantic aluminum plant in Oklahoma, whether it’s these data centers that Qatar is going to do, is $600 billion on its way to $1 trillion from Saudi, it all accrues to the American people.
KRISTEN WELKER:
All right, Secretary Bessent, I know you’ve had a long week traveling with the president. Thank you so much for being here. We really appreciate it.
SEC. SCOTT BESSENT:
Good to see you.
[End Transcript]
Secretary Bessent was also on CNN, VIDEO BELOW:
