The Stone Zone is a weekly political podcast produced by the Red Apple Podcast Network. Hosted by John Rocha ( ) and Matt Knost ( ), and featuring special guest host Sarah Downey ( ). The Stone Zone's theme music is Come Alone by Suneaters, courtesy of Lotuspool Records. Our ad music is by Build Buildings Records, recorded live at WFMU in St Louis, Missouri.
00:14:26.140We're preparing to be joined by Secretary of the Treasury Scott Besson,
00:14:30.960who's going to tell us about the status of the President's Liberation Day tariff negotiations.
00:14:36.560He is fresh off talks with the Chinese.
00:14:40.320I want to ask him about what kind of progress we're making there.
00:14:43.580I also want to give him an opportunity to address the President's critics,
00:14:48.520who I think misrepresent the many great ramifications of the big, beautiful bill.
00:14:54.660So you're going to want to stick around for that.
00:14:57.640Meanwhile, President Trump had a bold message for Apple CEO Tim Cook on Wednesday.
00:15:04.000He said that bringing back manufacturing jobs in the United States is the cornerstone of his America First agenda.
00:15:12.040And the President called on Cook last week in Qatar,
00:15:15.040saying that he had a little problem with the tech giant using facilities in India to make iPhones for sale in the United States.
00:15:23.660We're going to ask Scott Besson about this because he said that the President is trying to light a fire under the European Union
00:15:32.120and the tech giant Apple to ensure that America is bringing production back to dominance for Apple.
00:15:41.260I would hope that this would light a fire under the EU because, well, they have a collective action problem here.
00:15:47.920It's 27 countries, but they're being represented by this one group in Brussels.
00:15:52.520So some of the feedback that Scott Besson said he was getting from the underlying countries
00:15:58.420don't even know that the EU is negotiating on their behalf.
00:16:03.000There are 18 important trade deals that we have to do.
00:16:06.500Besson is working, claiming his focus has largely been on Asia, but he has a big job.
00:16:12.820We're going to have a chance to ask him about it coming up.
00:16:16.620In the meantime, it is also very sad to hear that my good friend Dilbert cartoonist Scott Adams has announced that he has terminal cancer.
00:16:29.920The cartoonist said that President Donald Trump personally reached out to him after he revealed his cancer diagnosis this past week.
00:16:38.760Adams, who has appeared on this show, is a great guy, great patriot, very funny guy.
00:16:46.06067 announced on his own live stream on Monday that he has metatastic prostate cancer,
00:16:52.820the same time that type of cancer that former President Joe Biden claims he was recently diagnosed with.
00:17:00.100I do have questions about that because we played an audio here in the Stone Zone two nights ago of Joe Biden saying in 2022 that he had cancer.
00:17:11.860Yet the statement put out by his office claimed that he only learned that he had cancer last Thursday and announced it on Friday.
00:17:21.340In any event, please don't touch that dial, because when we come back, Secretary of the Treasury Scott Besson is going to tell us how America's plan for a golden age under Donald Trump is coming.
00:17:35.660An age, I think he's the one who coined that phrase, actually, an unprecedented age of peace, prosperity, security and justice.
00:17:43.420We'll be right back with Secretary Scott Besson.
00:19:33.620Tell us the implications from your point of view.
00:19:35.520Yeah, Roger, this one big, beautiful bill is the most important piece of legislation that's going to pass this year.
00:19:45.800The president's economic agenda is the three-legged stool, its trade, its taxes, and its deregulation.
00:19:53.060And all I hear as Treasury Secretary, all I hear from people who don't like the tariffs is uncertainty, uncertainty, uncertainty.
00:20:02.760But then the same people who complain about uncertainty about the tariffs, they are trying to block this tax bill.
00:20:11.640And I can tell you that the certainty that will come from this tax bill is the stimulus in and of itself.
00:20:17.680And as you said, if you want to see a deficit blowout, don't pass this tax bill because the growth will collapse.
00:20:29.640And this is the – we're making the 2017 Tax Cuts and Jobs Act permanent.
00:20:39.820We are putting in full expensing for equipment and machinery.
00:20:45.720We're putting in full expensing for factory structures.
00:20:50.000So not only is the U.S. the best place to have a factory, it's going to be the most tax-effective place to build one and furnish it out with equipment.
00:21:02.740And then we're – this bill also contains the president's campaign promises of no tax on tips, no tax on Social Security,
00:21:11.580no tax on overtime, and tax deductibility for auto loans for American-made cars.
00:21:18.580And so, Roger, every Democrat who voted against this bill voted against a tax cut on Social Security, every single one of them.
00:21:31.720Secretary, this morning I saw that you met with community bank leaders from both in and outside New York, as well as small business owners.
00:22:19.520It's time for Main Street to play some catch-up.
00:22:22.220And I think that one of the key elements for Main Street playing catch-up are these small community banks, small town banks, or small regional banks that have just been throttled in their growth prospects and inability to serve their communities by all this excess regulation that we've got coming out of the great financial crisis.
00:22:47.300And I used to teach economic history, and the history is that when you have a crisis, there's always an overreaction.
00:22:57.200And what these small bankers from mostly New York but some from around the country have told me is that this regulation is killing them.
00:23:09.48070% of agricultural lending is from small banks, 40% of small business lending, and we've got to get these banks on their feet, healthy, and lending again.
00:23:27.080And they're chomping at the bit to go.
00:23:29.600They just need the right policies, which is what the Trump administration is trying to do.
00:23:35.700The previous administration, as we know, was extraordinarily hostile to digital currency, cryptocurrency.
00:23:47.620The president has embraced cryptocurrency as a vibrant industry in our country and an alternative monetary system.
00:23:56.540Why is crypto, why is digital currency so important?
00:24:01.240Well, Roger, it was even important as the Biden administration was trying to kill it.
00:24:10.580What's important is for the U.S. to be the digital asset leader as we are the technological leader in every other aspect, whether it's AI or CRM solutions.
00:24:24.820And it is important for the U.S. to be the leader because we will bring crypto and digital assets onshore.
00:24:34.220We're going to have a thriving ecosystem here.
00:24:39.300Everything from Bitcoin to stable coins and everything in between.
00:24:43.760We're going to apply U.S. best regulatory practices, which is safe, sound, and smart.
00:24:52.320And those will go out to the rest of the world.
00:24:55.280These blowups that you see in the rest of the world, like Sam Bankman-Fried down in the Bahamas, that wouldn't have happened if we'd been onshore in the U.S.
00:25:10.600And fortunately, these companies and the crypto entrepreneurs persevered through what could have been an extinction phase the past four years.
00:25:22.260And now it is a pleasure to work with them and set up the proper regulatory framework for the U.S. to take the lead and push this important.
00:25:34.420It's such an interesting combination to me as somebody who has studied fiscal policy and monetary policy.
00:25:43.560And then you combine that with technology.
00:25:46.320And the U.S. absolutely has to have the lead in this.
00:25:49.560I think this is one of the most important and exciting things that the president is doing.
00:26:33.460And, Roger, you've known President Trump a lot longer than I have.
00:26:38.500But I can tell you the joy of working with him is that he has created maximum leverage for his trade team by pushing so hard on both our allies, who have taken advantage of us,
00:26:58.620and some of our adversaries or competitors or competitors, trade competitors, military competitors like China.
00:27:06.260He's pushed hard on both of them to bring them to the table.
00:27:10.860Your listeners should understand that there are 18 important trading relationships, and we are pushing those first.
00:27:21.560We reached a deal very quickly with our oldest ally, the U.K.
00:27:27.600It's going to mean between $5 billion, $10 billion of new trade for U.S. companies and ag products that is going to benefit the American people.
00:27:40.140We went to, we had had an unfortunate escalatory phase with China, because on Liberation Day, we had said, do not escalate.
00:32:33.820I think the president is absolutely right.
00:32:36.820How close are we to a bank deregulation deal?
00:32:40.300Would that not make it easier for banks to hold those Treasury notes we spoke of?
00:32:47.060Yes, I think we will get something over the summer.
00:32:50.020There's a technical term called the supplementary leverage ratio.
00:32:55.400And, Roger, I began my career on Wall Street in 1984 as a banks and insurance analyst.
00:33:02.420So I know how these beasts work from the inside and how bank regulation should work and could work.
00:33:11.840And we are pushing to have this supplementary leverage ratio either reduced or removed, and it will allow banks to buy more Treasuries.
00:33:24.840And it's the craziest thing you've ever seen.
00:33:27.100They're going to take a big capital charge for holding a risk-free asset.
00:33:30.940So during COVID crisis, there was an emergency lifting of the supplementary leverage ratio and caused rates to go down the tens of basis points.
00:33:46.860So I think we could see anywhere from a 30 to 60 basis point decrease in rates based on this over time.
00:34:00.660The president had announced the creation of the Sovereign Wealth Fund as the administration's priorities include paying down the national debt.
00:34:09.160And for the time being, they have paused those plans.
00:34:12.020There's plenty on the president's plate and on yours.
00:34:14.860At what point will you feel comfortable about getting that fund up and running?
00:34:20.260What types of investments do you think it would make?
00:34:24.280Well, Roger, the president is moving at breakneck pace.
00:34:31.180Nobody knows that better than you, but he's doing peace deals, trade deals, and tax deals.
00:34:38.100And once those settle down, I would think that once we get over the hump and this deficit to GDP starts going down,
00:34:51.980the total debt to GDP stabilizes and starts going down, and we are paying down debt,
00:34:59.820then the Sovereign Wealth Fund will be on the table because I'd like to focus on this as a real legacy asset for the president
00:35:12.080because what I have observed, and I'm a professor, what was a professor, too, of economic history is aside from my day job,
00:35:21.280President Trump is the first president in centuries who wants to create assets for the American people