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Jan. 15, 2025 19:31-20:01 - CSPAN

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Washington Journal Rep. Adrian Smith

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pedro echevarria

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pedro echevarria ▲ ● ▼		We are joined by Representative Adrian Smith, Republican of Nebraska.
		He's the Ways and Means Trade Subcommittee Chair, and he serves the third district of the state of Nebraska.
		Representative Smith, thanks for joining us.
unidentified		Great to be here.
unidentified		Good morning.
pedro echevarria ▲ ● ▼		As chair of the subcommittee, can we get your personal thoughts on how tariffs should be applied in the United States?
unidentified		Well, tariffs are something that has been around a long time.
		We've found out that they can have varied impact at various times, impact the economy as well.
		Overall, I can't say I'm a huge fan of tariffs, but I do believe they need to be a tool in the toolbox as negotiations take place.
		It's very important that we are tough negotiators to level the playing field that over time has been pretty slanted against us.
pedro echevarria ▲ ● ▼		When you say you're not a huge fan, is that because of their ultimate impact on an economy, or are there other reasons?
unidentified		That potential, certainly.
		And representing a lot of agriculture, we don't really like it when other countries place tariffs on our products.
		And we're good exporters of ag products, let's face it.
		Other countries tend to like our quality and price and value.
		And so we don't like it when they place the tariffs on us.
		That said, we need to keep our options on the table as negotiations would move forward.
pedro echevarria ▲ ● ▼		President-Alec Trump has talked about a variety of ways to approach tariffs and wants to achieve certain amounts of things with them.
pedro echevarria ▲ ● ▼		Generally, what do you think of the approach he's taking?
unidentified		Well, I think it's important that we drive a tough negotiation.
		And, you know, I've shared this with a lot of folks that we need to level the playing field, make no mistake.
		And I think what we've seen over the last four years and lack of action, in fact, some of my Democrat colleagues just yesterday in committee criticized tariffs.
		Now that Trump's coming back in, even though nothing was done about tariffs over the last four years, and let me say even more importantly, there was such a lack of action on trade across the board for the last four years.
		That inaction, I think, is especially damaging because our competitors, our trade partners, expect more from the United States of America than what they've seen in the last four years.
pedro echevarria ▲ ● ▼		Specifically, then, what would you like to see the administration do to a specific country when it comes to tariff policy?
unidentified		Take Kenya, for example.
		The previous Trump administration teed up a trade agreement with Kenya.
		Now, Kenya already enjoys the benefits of what we call a GOA, the Africa Growth and Opportunity Act, an important policy.
		Kenya enjoys those benefits, basically tariff relief.
		And so there are other aspects of trade with Kenya that we could benefit from in terms of market access, agriculture being one of those.
		So the Trump administration teed up a trade agreement, like I said, with Kenya.
		The Biden administration comes in and says, well, we'll talk about trade, but not about tariffs.
		I can't understand why that's been the case when, like I said, Kenya already benefits from AGOA.
		Let's talk about market access and how we, our exporters from the United States, can get their products into a country such as Kenya on a continent that's growing in population.
		That's what separates Africa from so many other continents is its growing population.
pedro echevarria ▲ ● ▼		And I suppose though, as countries go, then China would come to the top of that list as far as how we apply those tariffs.
		What's the concern?
		What's the benefit of applying tariffs going forward or applying other tariffs?
unidentified		Well, the details can be very fine on all of trade.
		Trade is a lot of work.
		And with growing technology, diversifying economies, that makes trade even more difficult.
		So digital, for example, that is an important one because the U.S. leads the world in digital trade.
		Other countries say, wow, that's a great source of revenue, especially if it only comes from another country such as ours.
		That can be damaging in various ways, among them access to information and the flow of information.
		That is important as well.
		China, as a competitor, let's face it, and they are engaging in places around the world where we are not.
		That's a problem.
		And I think we will stand to see a vigorous, vigorous engagement in this incoming administration, especially in contrast to the outgoing administration.
pedro echevarria ▲ ● ▼		We've heard the president talk about tariffs as a tool to do things like reduce the amount of fentanyl that comes in the country and other things.
pedro echevarria ▲ ● ▼		Is that the proper use of a tariff?
unidentified		Well, fentanyl being a dangerous product, especially if we would become dependent on that revenue, that's an unstable source of revenue.
unidentified		I can't see a tariff being a good application there on fentanyl.
pedro echevarria ▲ ● ▼		But he uses it as a means to say if we put these against the country, the country responds or at least can reduce the amount of fentanyl, then the tariff achieves its purpose.
pedro echevarria ▲ ● ▼		Do you think that's a reasonable measure?
unidentified		That can be the case.
unidentified		Again, I think we need to be careful and not become over-reliant on tariff revenue that is probably not very stable.
pedro echevarria ▲ ● ▼		This is Adrian Smith joining us, Representative Republican from Nebraska.
		He's the chair of the trade subcommittee for the Ways and Means Committee.
		And if you want to ask him questions about trade and tariffs and other related issues, 202748-8000 for Democrats, 202-748-8001 for Republicans, 202748-8002 for independents.
		And if you want to text us, 202-748-8003.
		When it comes to an agenda for your subcommittee and larger for the Ways and Means, what's on the agenda going forward in these first days?
unidentified		Well, we're looking at the pressures on our supply chains.
		Our supply chains for domestic manufacturers, for example, accessing various products.
		Sometimes they face barriers.
		Sometimes those are tariffs as well.
		So sorting through all of that, the general system of preferences, that's a tariff relief effort.
		The AGOA, another important program, it expires later this year.
		And we want to make sure we stay on top of that.
		Let's modernize these approaches as we can.
		But that engagement, sending a message to the world.
		We've got the review of USMCA coming up next year.
		Let's prepare for that.
		We just won a big case against Mexico that really, I think, flagrantly violated the USMCA in trying to shut out biotech corn.
		A lot of it happens to come from my district.
		But the world is watching.
		When Mexico basically shut out our corn and President Biden didn't say anything, now some of his people went and filed some paperwork to ultimately literally years later, win a case.
		But I think we could have shortened that timeframe had President Biden spoken up and said, listen, USMCA has negotiated.
		We all agreed during the previous Trump administration that USMCA was what we were going to work under.
		Mexico violated that.
		And the world is watching to see what our response is for something like that.
		So I'm glad that we are moving into, I think, a more vigorous time in trade and engagement.
		And our trading partners, like I said, they expect us to engage more, unlike what we've seen over the last four years.
pedro echevarria ▲ ● ▼		On the larger aspect of your service on the Ways and Means Committee, that's the committee that deals with tax issues.
pedro echevarria ▲ ● ▼		What's the future of taxes that were placed in the first Trump administration in 2017?
unidentified		The future is bright.
		We have been having some, I think, very engaging meetings, hearing from our constituents as well of how important it is to extend and hopefully make permanent that what we did in 2017.
		There might be some small tweaks to modernize that perhaps on some needs that may exist.
		But what we did in 2017 was a result of years long negotiation and discussion and hearings that teed up our action in 2017 that was the right thing to do.
		It was thoughtful.
		It was effective.
		Revenues have increased as a result of that.
		And I think we would be very derelict to just let that all expire and go away.
		It would be very damaging for our economy as well.
		So we are very, very excited to get this done.
		It'll take some work, narrow majority.
		But I do know that it's my sense anyway that a lot of Democrats who were skeptical before, they may not vote for this just yet, but they have voted for parts of what we did in 2017 in extending that.
		And I think there's broader understanding across America that what we did was the right thing for what we needed at the time.
		And I'm glad we were able to do that before COVID.
		That has made our post-COVID recovery go a lot better.
pedro echevarria ▲ ● ▼		There's a story out this morning about the impact of what's been taken in by the federal government and what's been spent for October, November, and December.
		They're saying there was a deficit coming into that $711 billion deficit over those last three months.
		They highlight the fact that the problem, some of the problem was spending with issues such as Social Security and Medicare, but they also say that part of it was revenue that was taken and saying that the federal government collected $1.83 trillion, spent $1.7 trillion.
unidentified		Well, you looked at overall.
		I don't find or hear too many Americans who say, boy, the federal government just spends their money so wisely.
		The concern is that the spending doesn't get addressed like it needs to be.
		And so I think the American people expect us to look at the spending issue as well.
		When you see the increased revenues to the government over the last several years, that's pretty telling.
		And so, yes, to take a three-month clip there, that is probably a bit isolated in its view.
		But I'm willing to look at those numbers.
		I'm willing to look at criticisms that some folks might have of what we did in 2017.
		It's up to us to process that, to have the discussions that we need to have.
		Let's have this engagement that the American people want us to have.
		And at the end of that, make a decision.
		And I think the best thing to do for our country is to have pro-growth tax policy moving forward.
pedro echevarria ▲ ● ▼		Well, some of the issue there was less tax revenue.
		Democrats are arguing that the tax cuts provided that less revenue, and they want to see more taxes going forward.
		Make the case that at this time, you know, more tax cuts or at least sustained tax cuts are the way to go.
unidentified		Well, again, we'll have the discussions that we need to have.
		What is most appropriate?
		Now, there are some tax cuts that are more growth-oriented than others.
		That doesn't mean that we just ignore those that aren't as productive economically.
		There could be some fairness in there, too.
		So let's look at that.
		But at the end of the day, we need policies that help grow our economy.
		And this just soak the rich, tax the rich.
		When you look at the progressive nature of our tax policy already, the wealthy are paying a lot.
		Now, are there some loopholes?
		Probably.
		There were loopholes created by the so-called Inflation Reduction Act and some benefits there for the wealthy that I think we can do without as well.
pedro echevarria ▲ ● ▼		Let's hear from Marie.
		Marie in Texas with Representative Adrienne Smith, Republican of Nebraska.
		Marie, good morning.
		You're first up.
unidentified		Oh, thank you.
		I called in to say that I fully support P-Tex 100%.
		And also, I resent the way that the Democrats acted yesterday.
		They're like a bunch of babies.
		And to disparage him the way they did is unacceptable, unacceptable.
		And that's it.
pedro echevarria ▲ ● ▼		Okay, that's Marie Texas talking about that back and forth yesterday when it comes to nominees.
pedro echevarria ▲ ● ▼		You can express your thought on that if you wish.
unidentified		Well, in the House, we don't have a vote on that.
		I know that across America, a lot of people are paying close attention.
		And I think the American people, they want a civilized discussion to process through what the Senate is responsible for doing in the advice and consent on the president selecting a cabinet.
		I'm one who believes that there should be very serious deference to the president to select a cabinet that he was elected actually to select.
pedro echevarria ▲ ● ▼		From Tom in Florida, Democrats line.
pedro echevarria ▲ ● ▼		Hi.
unidentified		Hi, how are you doing today?
		We appreciate Washington Journal.
		I would like the gentleman to expand more on the tee up comment.
		He's used that numerous times.
		And if he would, well, using the Kenya example he mentioned, what did actually they propose?
		We want to know more detail on that.
		T-Up, what does that mean?
		The second thing I would like to ask him if he understands the Warren Buffett rule, Jamie Diamond, Goldman Sachs just commented on it, Bill Gates, where if the rich paid the same percentage basically the middle class does, we would have a balanced budget.
		Does he know about that and he doesn't like that idea?
		So those are the two questions I'd like to ask him, please.
		The teeing up terminology that I use, that's not a technical term, but it's preparation before presenting a piece of legislation, for example, or an idea.
		And the fact of the matter is the previous Trump administration prepared to lay out a trade agreement with Kenya.
		Now, it requires a lot of work.
		There's a lot of diligence that's necessary because, like I mentioned, the growing technology and just a lot of moving parts to this type of negotiation.
		Oftentimes, a trade agreement will be presented and start out with nowhere near the votes to pass.
		It's my sense that the Kenya trade agreement would have received a strong bipartisan approval.
		I sense that there are more and more Democrats all the time looking at growing opportunities in America by engaging with our trade partners.
		In this case, Kenya would be an example.
pedro echevarria ▲ ● ▼		He also asked about collecting more from wealthy Americans to benefit the middle class.
unidentified		Right.
		Well, when you look at various dynamics of the tax code, wealthy Americans pay a greater percentage of the revenues to the coffers than lower income folks.
		In fact, there's a large segment of the population who does not have a federal tax liability.
		And when we doubled the standard deduction during 2017, TCJA, we doubled that standard deduction.
		We've doubled the child tax credit.
		A lot of things that were important, especially for folks on the lower end.
		Now, we get criticized for what is called that SALT cap, the state and local tax deduction.
		That used to be fully deductible.
		The billionaires could fully deduct their property tax on multiple vacation residences.
		And we said, no, let's cap that.
		In fact, in 2017, the average state and local tax deduction per household across America, the average across America, was about 5,000.
		So we doubled that to 10 and put that cap.
		Now, we'll take a look at that.
		That was not indexed for inflation.
		We want to make sure that those numbers are up to date, perhaps, but still within the framework of, let's not give away a huge deduction, especially to the very wealthy, that would cost other taxpayers a lot of money.
pedro echevarria ▲ ● ▼		This is Karen.
		Karen's in Alabama.
		Republican line.
unidentified		Hey, good morning.
		So I have heard a few, I don't know if they're specifically Trump people, but I'm assuming that they support Trump.
		Anyway, they had talked about abolishing the IRS, abolishing our current tax code, and having everybody in the country pay 10% of their income for the income tax, and then maybe like a national sales tax.
		I'm curious if you think that's something that's a legitimate thing that we could do, and if so, how can we do it?
		Thank you.
		Sure, that's a fair question.
		I think that a lot of folks across America understand the complexities of the current code.
		I want to always look for opportunities to simplify the tax code.
		Now, I also want to make sure that we don't have inadvertent efforts that would result in perhaps putting a larger segment of revenue on a smaller number of people who can't afford it, perhaps.
		But I always want to look at ways to simplify the tax code.
		We know the IRS has struggled, even today, with the immense resources, additional resources that they've received in the last few years to supposedly add new employees so that more audits can be done to supposedly focus on compliance.
		But the concerns that I have and many others have are that audits would be done on folks who already did the right thing and yet they have to ramp up a defense because of the additional resources coming from the IRS.
		The IRS, we have found, hasn't even been able to find the employees, not a unique situation across our economy, but the IRS has struggled.
		So I hope moving forward that we can see a modernized IRS that utilizes technology to improve customer service so that ultimately folks who have questions, legitimate questions, they can get those answered in a timely basis.
		We're told that maybe the weight is less than it used to be, but there's still a lot of room for improvement at the IRS for what needs to be done to improve their customer service, ultimately, you know, foster an environment where compliance is easier.
		Compliance is faster, perhaps, and let's focus on that technology.
pedro echevarria ▲ ● ▼		That's the Internal Revenue Service.
		The President-elect wants to create something called the External Revenue Service, according to reports, and this would deal specifically collecting monies from trade.
		How would this differ than what's currently done?
unidentified		Well, the IRS, yes, that is internal, basically, and the collection of tariffs.
		It exists today, even without an external revenue service.
		The president, I think, is focusing on the fact that we have an unlevel playing field for our country competing against other countries.
		A very significant point here, these other countries that levy a value-added tax, a VAT, they levy that on products in their own country.
		But when they go to export their products to our country, they waive the VAT, therefore making their products cheaper coming into our economy than even for their own people.
		That is unlevel.
		And that is, I think, an uncompetitive situation that we need to ultimately address.
		I think the president, incoming President Trump, is interested in this as well.
		But he's a fierce negotiator, and I think we can be better for it.
pedro echevarria ▲ ● ▼		Who's responsible then for collecting tariffs?
pedro echevarria ▲ ● ▼		What body in the government does that directly?
unidentified		Well, Treasury.
		Ultimately, Treasury is, and IRS is less involved with that.
		But commerce is involved on a lot of this as well.
		United States Trade Representative, obviously the ambassador level and a member of the President's cabinet.
		There's for as small as the USTR is as an agency per se, they've got very significant jurisdiction.
		But I really see it as important.
		I think we're going to see an effective coordination among the agencies coming in because President Trump, like last time, he really leaned in on trade and less conventionally perhaps than other presidents.
		But fact of the matter is that brought people together.
		USMCA is a great example.
		When President Trump said he wanted to renegotiate NAFTA, like several candidates for president had said prior, he actually did it.
		And so he marched forward on that with the right folks in place to elevate the issue of trade.
		And I think all across America, I think the coffee shops across America elevated their discussion as well in terms of what trade is.
		And USCMCA is a great example.
		USMCA, a Trump priority, was shepherded through the House by then Speaker Nancy Pelosi.
		If that can be done, I think a lot of other things can be done too.
pedro echevarria ▲ ● ▼		Scott is from Kansas.
pedro echevarria ▲ ● ▼		Democrats Live for our guest Representative Adrian Smith.
unidentified		Good morning.
		Thank you for taking my call.
		You know, I just see the deficit going up and up and up.
		And at one time, we had eliminated the earmarks that they used to call pork spending.
		We also had what was a balanced budget amendment.
		And I also think that when they talk about revenues going up after cutting taxes on the rich, what would they have gone if they had not cut the taxes and you still go back to the original founding fathers?
		Those that enjoy great fruits and privileges of this country owe back to the nation, not at the same rate, but at a rate much greater.
		And as we're seeing a grift between the haves and the have-nots, I just don't see a lot of action being taken by Congress to get their financial house in order.
		They harvest wheat somewhere in the world every single day of the year.
		I know our agriculture products need to be exported at a fair price, but there's just so much details in how the government is ineffectively managing our taxpayer money.
		And it's earmarks that I think bother me the most.
		Okay.
pedro echevarria ▲ ● ▼		Scott there from Kansas.
unidentified		Yeah, Scott, I appreciate your question, especially on the debt question.
		There are many of us in the House and Senate very concerned about the debt.
		This is something that has been looming for some time and growing, as you know.
		And that's a major part of the discussion on the tax reform extension or permanence that we are looking at.
		And we are wanting to bend that curve and to get our house in order.
		Now, let's be very honest here.
		And there are various spending parts of the federal budget.
		We have discretionary spending, mandatory spending.
		And the discretionary spending are those programs that Congress revisits every year.
		The mandatory spending are the programs that exist.
		Basically, when things happen across America, they send the bill to the federal government, and the federal government pays that.
		And we need to revisit all of this.
		But a lot of folks think that, well, gosh, if you close the Pentagon, we balance the budget.
		No.
		In fact, you'll see where it's called crowdout.
		That mandatory spending is actually crowding out other spending, such as defense.
		Now, I'm not saying there shouldn't be any efficiencies or cuts within the Defense Department, but let's not kid ourselves in thinking we can just slash away at various things and fix everything all of a sudden.
		It's not that easy.
		And we've not addressed mandatory spending like we really need to, and that's in the health care sector.
		I think we can make sure that technology can develop in a way to help us on the health care front without barriers taking place.
		For example, I have a bill right now that would reimburse pharmacists to test and treat things like strep throat, COVID, and flu.
		Right now, these pharmacists can't get reimbursed by Medicare, even though Medicaid will reimburse and private insurance companies reimburse.
		There's a barrier to pharmacists receiving that payment, and it would be a reduced payment from what an MD would get reimbursed as well.
		So there are barriers that exist to applying technology and the opportunities for our health care professionals.
		We are the envy of the world in terms of health care training and professionals.
		Let's let them treat who we know they can treat effectively.
		Let's remove the barriers so that we can see more access.
pedro echevarria ▲ ● ▼		As far as legislation goes, you also have something called the Family and Small Business Taxpayer Protection Act.
unidentified		What is that?
		Well, the various efforts out there to help small businesses.
		There's the expensing and there's the interest provisions as well that I've been working on that are part of the tax reform.
		But that overall, we know that small businesses are a major part of our country and our economy, and we want to make sure that they don't get pushed to the side as we discuss so many things facing tax reform and the budget.
pedro echevarria ▲ ● ▼		Before we let you go, the president wants to see a reconciliation bill in the minutes we have yet.
pedro echevarria ▲ ● ▼		What is that, and particularly, how would it work in achieving the policy goals of the president?
unidentified		Well, the reconciliation process has been around since the 70s.
		It allows Congress to revisit budget numbers to reconcile the numbers, as the definition would go.
		What it allows as well is something to pass the Senate with 51 votes instead of the 60.
		So now, the House has always a simple majority, and even the closeness of the majority right now, I think it's a pretty good chance we can move something out of the House.
		The Senate will need to act accordingly as well.
		Now, it limits what can be in the bill.
		Policy, new policy cannot be in the bill.
		Now, there will be changes made to existing policy that will affect numbers in the budget.
		But moving into a reconciliation process, the budget committee will give us instructions, and then we fill in from there.
		So, there's going to be a lot of effort here underway soon.
pedro echevarria ▲ ● ▼		And is tax policy part of that?
unidentified		Tax policy is part of that, yes.
		What could change?
		Timelines, sunsets, permanence, or dates on those as they impact the budget and in spending.
pedro echevarria ▲ ● ▼		Representative Adrian Smith, he is the Ways and Means Trade Subcommittee Chair.
		He's also the Republican representative from Nebraska.
		Thanks for your time.
unidentified		Thank you.
unidentified		C-SPAN, Democracy Unfiltered.

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