Episode 814: Federal Budget Spending Priorities

Summary

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Newt’s World – Episode 814: Federal Budget Spending Priorities

Host: Newt Gingrich
Guest: Richard Stern, Director of the Grover M. Herman Center for the Federal Budget at The Heritage Foundation
Date: February 22, 2025

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Overview

In this episode, Newt Gingrich hosts Richard Stern for a deep dive into the complexities of the federal budget process, legislative gridlock over spending and tax cuts, the challenges of “pork barrel” spending, and how historical and current political dynamics shape America's fiscal future. The conversation highlights the tension between institutional inertia and bold reform, often drawing lessons from history to illuminate today's crossroads.

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Key Discussion Points & Insights

1. Understanding Budget Legislation Mechanisms

• Regular Spending Bill vs. Reconciliation Bill (03:24–04:45)

  • Stern explains the reconciliation process as a unique, expedited legislative route in the Senate that bypasses the normal 60-vote filibuster threshold, enabling major legislative actions with a simple majority (50 votes plus the Vice President as tiebreaker).
  • Quote:

    "You would think that having control over the House and the Senate means that you would, well, have control over the House and the Senate. But the truth is you need 60 votes in the Senate to be able to clear a normal spending bill... The thing that a reconciliation bill does is it unlocks a magic 50 vote threshold with the vice president as the tiebreaker."
    — Richard Stern (03:43)

  • Reconciliation originated as a tool to align actual and planned budgetary paths, not as a primary vehicle for major policy changes.

• Three Main Budget Vehicles

  • Appropriation Bills: Regular spending, require 60 votes in the Senate.
  • Reconciliation Bill: Expedites certain budget-related legislation via a simple majority.
  • Continuing Resolution (CR): Temporary measures to keep the government running when neither appropriations nor reconciliation have passed.

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2. The Looming Threat of Government Shutdowns (06:26–09:11)

• CRs are being extended repeatedly due to congressional deadlock, with another expiration looming (March 14).
• Stern anticipates another short-term extension, because "Congress doesn't seem to have that resolve again, that there is that resolve in the admin... but it doesn't seem to exist within the Congress." (09:11)
• Newt reflects on his experience leading the GOP during the 1995 shutdown, emphasizing its political necessity at the time to show seriousness about balancing the budget.

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3. The Challenge of Pork Barrel Spending (10:28–12:28)

• Pork barrel spending remains a critical obstacle, often tied to members seeking projects that benefit their districts at the national fiscal expense.
• Stern references de Tocqueville and warns of the "raiding [of] the public treasury for their own benefit," emphasizing how this dynamic "represents exactly that kind of pork barrel spending... breaking Congress of that habit... is essential." (11:10)
• Emphasizes a fundamental belief: "prosperity comes from the private sector, not from government redistributing wealth." (12:19)

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4. Diverging Paths: House vs. Senate Priorities (14:36–18:29)

• Discretionary vs. Mandatory Spending (14:48)

  • Discretionary spending: Appropriations, e.g., defense, regulatory agencies.
  • Mandatory spending: Entitlements (healthcare, welfare), addressed mainly via reconciliation.

• Senate Proposal:

  • Minimal $3 billion in mandatory spending cuts, allows hundreds of billions for border/defense without requiring significant spending offsets.

• House Approach:

  • Requires $1.5 trillion in spending cuts over 10 years before authorizing border/defense increases and up to $4.5 trillion in tax cuts.
  • Quote:

    “The House is following what President Trump has asked for... But again, to unlock the tax cuts and to unlock the border and defense money... you would need to actually get the one and a half trillion of spending cuts.”
    — Richard Stern (16:35)

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5. Tax Cuts, Deficits, and Economic Stakes (18:00–19:54)

• Newt warns that delay in passing tax cuts could weaken the economy and the GOP’s 2026 electoral prospects.
• Stern outlines the trade-off: Tax cuts needed for growth, but deficit hawks fear increased debt and inflation if not offset by spending cuts.
  • Quote:

    "...if the tax cuts don't get done early in the year, or frankly, if they don't get done at all, we would see thousands of dollars of tax increases on American middle class families, on American small businesses. That would of course tank economic growth or delay it..."
    — Richard Stern (18:29)

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6. Fighting Waste, Fraud, and Systemic Inefficiency (19:54–22:19)

• Gingrich muses that “making America honest again” could save a trillion dollars annually lost to waste and fraud.

• Stern estimates $400 billion in annual losses—$1,200 per family—but suspects the real number is much higher.

  • Quote:

    "On average in a year, the government is willing to admit that some $400 billion is lost in waste... I think you're absolutely right that a more honest capture of that is easily a trillion or more dollars a year."
    — Richard Stern (20:41)

• Fear in Congress of enacting real reform; skepticism rooted in years of unfulfilled calls for action.

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7. Historical Analogies and Changing Dynamics (29:41–37:31)

• Comparison of Trump to Reagan and Andrew Jackson—Trump as a transformative, anti-establishment force.

  • Quote (Newt):

    "You now have a president who I think in his first month is already the most consequential president since FDR. And if he keeps going at this rate, he'll presently be the most consequential president after Washington and Lincoln...” (29:41)

• Stern adds that Jackson’s breaking of the establishment enabled America’s rise—parallels drawn with today’s need to confront the entrenched “imperial city, deep state.”

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8. Restoring Civic Culture and Education (37:31–38:58)

• Both agree that successful reform must be accompanied by deep public education.
• Stern is optimistic about homeschooling and alternative models ("microschooling"), believing they will help future generations grasp the importance and depth of systemic reform.

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9. Advice for Congressional Leadership (38:58–41:07)

• Newt asks Stern for direct advice to Speaker Mike Johnson:

  • Stern urges boldness and communication, to frame the case not just in terms of dollars but as a battle for core values.
    • Quote:

      “Take the case to the American public, make it in terms that are not about the numbers and sense, but are about the values that underlie the numbers in a budget.”
      — Richard Stern (39:07)

• Gingrich closes with guidance from Lincoln, Reagan, and Thatcher: winning public sentiment is crucial for meaningful legislative and societal change.

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10. Closing Thoughts

• Stern: "You need visionary leaders... They were there to paint a boundary bold image of what the country meant, of what it can mean and what it can achieve in the future if we have the faith today to take those hard votes and to make those hard decisions.” (41:07)
• Newt emphasizes the need for revolutionary spirit and seizing the “historic inflection point” to achieve enduring reforms.

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Notable Quotes & Memorable Moments

• On the importance of resolve:

  "Congress really is a soap opera most of the time, masquerading as a legislative body..."
  — Richard Stern (07:04)

• On pork barrel spending and public virtue:

  "...convincing voters that government spending always comes at your expense, whether it's your tax dollars or it's what triggers inflation, that's what's essential here."
  — Richard Stern (12:14)

• On the imperative for civic education:

  "That homeschooling revolution is going to ensure... the generations of Americans to come will really understand all of these things, the level of depravity, frankly, of the deep state."
  — Richard Stern (38:40)

• On the role of leadership:

  “First you win the argument, then you win the vote.”
  — Newt Gingrich (citing Margaret Thatcher, 40:45)

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Timestamps for Key Segments

• Intro & Reconciliation Explanation: 02:10–06:22
• Shutdowns, Congress as "soap opera": 07:04
• Pork barrel spending: 10:28–12:28
• House vs Senate Budget Approaches: 14:36–18:29
• Tax cuts vs. deficit tradeoff: 18:00–19:54
• Fighting fraud & “Making America Honest Again”: 19:54–22:19
• Historical parallels (Jackson, Trump): 29:41–37:31
• Civic Education & Future Generations: 37:31–38:58
• Leadership Advice: 38:58–41:07
• Closing: 41:07–42:31

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This episode is rich with historical insight, pragmatic analysis, and passionate calls for bold, visionary leadership to tackle America's fiscal and political challenges. Those interested in how Congress might respond to a transformative presidency—and what’s at stake for the country—will find this a compelling, instructive conversation.

Transcript

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[Newt Gingrich]

On this episode of Newts World President Trump was elected with a mandate to secure the border and enforce immigration law, revitalize our national defense, unleash America's energy resources, and cut wasteful and fraudulent government spending that has driven inflation. To deliver on this agenda, Congress will need to fund these priorities. Here to talk about the federal budget spending priorities and the budget reconciliation process, I'm really pleased to welcome my guest, Richard Stern, Director of the Grover M. Herman center for the Federal Budget at The Heritage Foundation. Prior to joining Heritage, Stern was a congressional staffer for over seven years. During that time, he served as a policy staffer for the Republican Study Committee, where he was the staff lead for their budget and spending task force and spearheaded their work to create their fiscal year 2020 and fiscal year 2022 federal budgets. Richard, welcome and thank you for joining me on Newts World.

[Richard Stern]

Thank you for having me on today.

[Newt Gingrich]

I think it will be really helpful because as you know, this is very complicated. And so we want everybody to have sort of baseline knowledge. So let's just start with a very simple. Can you explain the difference between a reconciliation bill and a regular spending bill?

[Richard Stern]

Absolutely. And thank you for having me on for the conversation today. I think as a lot of people are starting to learn more about, you would think that having control over the House and the Senate means that you would, well, have control over the House and the Senate. But the truth is you need 60 votes in the Senate to be able to clear a normal spending bill. And in fact, you would need 60 votes in the Senate to clear any normal piece of legislation. And so the thing that a reconciliation bill does is it unlocks a magic 50 vote threshold with the vice president as the tiebreaker to clear through the Senate. Now, mostly parties never have 60 votes in the Senate. Even with Trump's mandate, Republicans still don't have anywhere near 60 votes in the Senate, but they can get 50 votes. And Vance, of course, can break the tie. And so that's why reconciliation perhaps is the only way to get major legislative WINS through the U.S. senate. This Congress.

[Newt Gingrich]

I'd never thought about it until we have this conversation. But why did the reconciliation process exist? Why did the Senate carve out that one place where 50 votes plus the Vice President is able to move something?

[Richard Stern]

Well, this, as I like to say, is one of those cases of unintended consequences in government. And this actually gets back to why it's even called reconciliation at all. That sounds like an odd term for it. It's that 50 years ago, 51 years ago, in 1974, Congress created the budget process, in fact, both budget committees, the entire concept of having a federal budget. And they did it, at least in some part, because they were already worried about entitlement spending and runaway autopilot government spending leading us to an unmanageable debt. Of course, as we know, we solved that problem. Wait, Just kidding. And so we're still in the throes of dealing with the problems from that. But one of the things they did in the budget process was create a way to reconcile differences between the existing budget trajectory and the planned budget trajectory. So this reconciliation bill was supposed to be a minor way of making a handful of changes to reconcile between the real budget path and the planned budget path. That's why it has these so called expedited lower vote threshold consideration processes in the Senate. But it was, as you can imagine, not at all meant to be a vehicle of major legislative making. But again, unintended consequences, it sort of.

[Newt Gingrich]

Mutated into the most important single bill of the year.

[Richard Stern]

Absolutely.

[Newt Gingrich]

Talk about a great example of evolution occurring in a way you could not have predicted at the time. But it gets more complicated, as I understand it, because you have kind of three things. You have appropriation bills, you have a reconciliation bill, but then you also have a continuing resolution which keeps the government running until they pass the appropriations bills. And as I understand it, the current continuing resolution, what we would have called a CR back when I was in Congress, is set to expire on March 14th. I mean, in your judgment, is Congress going to be able to avoid a government shutdown?

[Richard Stern]

Well, so I think Congress probably will, or it might shut down over the weekend, which is I think Congress's favorite thing to do. Because keep in mind, Congress really is a soap opera most of the time, masquerading as a legislative body, owing to everything we've talked about so far. I think the important part here for all the the listeners, is that a continuing resolution is when you can't get to an agreement about all of the funding for what you normally think of as the government. So this is all of the regulatory agencies, the military, transportation, things of that nature. And again, that's a bill that needs 60 votes. So it always needs to be a bipartisan bill. This is now going to be the expiration of the second cross extending an appropriations bill from late last year. And that's because twice Congress wasn't able to agree on a future path for spending. My guess is with reconciliation going on and everything else, they're likely to do yet another CR having now the third iteration of it dragging on further into this year.

[Newt Gingrich]

We've had three pretty big government shutdowns, 21 days in 95, 96 when I was Speaker, 16 days under Obama, and then a 35 day shutdown during Trump's first administration. And I have to say I'm probably in a minority in Washington. I thought the 21 days we shut down against Clinton in 95, early 96, was actually vital in convincing the president that we were really serious about cutting spending and really serious about getting to a balanced budget. And I always felt if we had not done that, that in fact we probably would have lost the House in 96, which we became the first re elected Republican majority since 1928. And I think it's because people decided we were real, that we were prepared to do what it took. But the Washington press corps and the Congress often gets panic ridden about this notion. As you look at it, you think they probably will be able to patch something together to keep things moving while they're negotiating.

[Richard Stern]

I'm a big fan of everything that you did in the 90s on that. I agree with your read entirely that it, as you said, it showed that the Republican Congress was serious at the time. I think one of the things that we've come to realize is Doge is serious. Doge is the kind of mirror image, if you will. It's a serious effort from the administration to cut spending the way that the shutdown you're talking about was a serious signal from Congress 30 years ago that Congress is willing to cut spending. I think part of the problem we see here is that Congress doesn't seem to have that resolve again, that there is that resolve in the admin at the level of doge, but it doesn't seem to exist within the Congress. So the truth then is if Congress wanted to try to shut down the government to force a conversation about spending cuts, I think most people would say that it's a bluff that could be called, which is why I think they're probably likely to patch together either some other short term funding bill like a CR or rather milquetoast full year appropriations bill that at this point only has about half the fiscal year left to go. But it's precisely because there doesn't seem to be that kind of resolve or focus on actually cutting spending.

[Newt Gingrich]

One of the things which makes it very complicated and which we had to overcome when we balanced the budget in the 1990s is that a lot of members, I think, place too great a value on kind of pork barrel spending for back home and you can end up with bills that have all sorts of interesting but not necessarily vital projects. Talk just briefly from your perspective about the role of pork barrel spending and the degree to which it's a challenge in terms of trying to get the budget under control.

[Richard Stern]

It is a tremendous problem. And actually it's something that de Tocqueville called out when he came to America. So he of course famously came 200 years ago, wrote about the amazing entrepreneurial, dynamic and innovative spirit of America. But he warned in his book that this will continue in America, this dynamism and entrepreneurialism, right up until the moment that the American public realizes that they can raid the public treasury for their own benefit. And that is so, tragically, precisely what happens in D.C. we have trillions and trillions of dollars of spending that represent exactly that kind of pork barrel spending, that kind of raiding the public treasury, your tax dollars, or having the Fed print inflationary dollars just to send home benefits to a concentrated few. And so breaking Congress of that habit, frankly convincing voters that government spending always comes at your expense, whether it's your tax dollars or it's what triggers inflation, that's what's essential here. But I, you know, for me, it's also a faith issue. It's convincing people that you have to have faith that the private sector is where prosperity comes from, that it does not come from government redistributing wealth or conferring benefits on anybody. But if we can get back to that spirit, then we can break the pork barrel issue and break its hold over Congress.

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[Newt Gingrich]

As you watch the current state of play. As you know, the Senate and the House are in very different places and how they want to approach this. Can you sort of outline for us what the two positions are and why you think they're different?

[Richard Stern]

Absolutely. I think important to what we're talking about here is there's really two types of spending. There's what's called discretionary spending, which is covered by the appropriations bills, including the continuing resolutions. And again, as I said, that's all the funding for regulatory agencies, the military, highway funding, things of that nature. Then there's mandatory spending, mandatory spending you can touch in a reconciliation bill where the appropriations we were talking about are off the table for a reconciliation bill. So you can think of appropriations as dealing with that first bucket of spending and reconciliations dealing with the second bucket. Mandatory, of course, deals with entitlements and health care, welfare, but also a myriad of other programs. I think what's been interesting about this is while there seems to be no consensus in either the House or Senate on the first bucket of spending cuts, appropriations, discretionary money, there is this real conversation about cutting mandatory spending. So as you alluded to, the Senate has put together a framework that would require a paltry $3 billion of mandatory spending cuts at a minimum. Now they could cut more, but that's the floor. The House, on the other hand, has put together a bill that would require at a minimum one and a half trillion dollars of spending cuts over the next 10 years. And if they get more spending cuts on top of the 1 1/2 trillion, they can then apply it to further cutting taxes. So again, as you said, a tale of two congressional chambers, two very different approaches to trying to get mandatory spending cuts this year.

[Newt Gingrich]

Why do you think the two bodies, both Republican, are so dramatically different in how they're approaching this?

[Richard Stern]

So the question here comes down to, in essence, whether you think Congress will actually approve those kind of cuts. And again, this gets back to can we restore the resolve of 95 and 96 versus how quickly do you want to get more money into the border to deportations, interior immigration enforcement and defense spending? So, perfect example is both the Senate and House frameworks would allow for several hundred billion dollars of border and immigration enforcement money and money for the Defense Department. But the Senate's produced a framework where you could just do that. You could just spend several hundred billion dollars on these priorities and not have to cut spending as well. The House, on the other hand, allows for that kind of border and defense money. However, you would need to get the requisite spending cuts we're talking about Now. The other thing, of course, is the House is following what President Trump has asked for, which is this framework would also allow for $4.5 trillion of tax cuts. But again, to unlock the tax cuts and to unlock the border and defense money in the House framework, you would need to actually get the one and a half trillion of spending cuts. Across the line. The Senate is looking at a much more limited, quick package just to do a few hundred billion for border and defense money dealing with spending cuts and tax cuts later in the year.

[Newt Gingrich]

I have to confess my real fear is that if we don't pass the tax cuts by May or June, they're going to go into effect so late that we will have a weak 2026 economically, and that will doom the House Republicans to being in the minority, which I think will be a total disaster for Trump. Right back to the Nancy Pelosi kind of warfare. And yet we don't seem to be able to get that across to senators.

[Richard Stern]

And some of the House members. Of course. In fact, the reason why the House requires that minimum 1.5 trillion of spending cuts is to appease some House members who are concerned with passing the full tax cuts without offsetting with some spending cuts. But I think to your point on that, it gets to the heart of the trade off conversation, which is that absolutely, if the tax cuts don't get done early in the year, or frankly, if they don't get done at all, we would see thousands of dollars of tax increases on American middle class families, on American small businesses. That would of course tank economic growth or delay it exactly the way you're talking about. But there is one other part of this that's important, of course, which is that we've run unprecedented deficits. We have a debt that is now $273,000 per household, mortgage rates are still at 7%. Inflation is still stubbornly at 3%. And so those extra senators and House members are concerned that if we do the tax cuts without spending cuts, it'll blow up the deficit and they're concerned that you'll get more inflation, even higher interest rates, and then that will counteract both kind of on the ground mechanically about the economy. But certainly in terms of political sentiments, what good comes from the tax cuts? And really, the way I see it, it's this trade off conversation that's going on in Congress that's stymie in the process.

[Newt Gingrich]

I'm puzzled because when I look at what Elon Musk is doing and what Doge is doing, it seems to me that they just by adding to make America great again and making America healthy again, if they adopted a principle of making America honest again, they probably could get a trillion dollars just by not paying crooks. I mean, it's astounding how much money goes out there that isn't real, it's not helping people. And it's literally in some cases just sloppiness and ineptness. In other cases, you know, it's genuine theft. It's almost as though the President is breaking loose and is doing things that are very bold. That the Congress is still stuck inside the framework of the old order.

[Richard Stern]

Absolutely. I think you couldn't put it better than that. You know, on average in a year, the government is willing to admit that some $400 billion is lost in waste. The way you're talking about, to put that in perspective, that's about $1,200 a year per American family. So you think of your own household budget. You are spending about $100 a month from your household on this kind of exact government waste and corruption. But I should say on the waste and corruption that the government is willing to report is happening, I think you're absolutely right that a more honest capture of that is easily a trillion or more dollars a year. But I think you're right. Part of this is that Congress has seen decades at this point of a lot of talk on further cutting spending and, and dealing with waste, fraud and abuse, that in the last 25 or so years hasn't come to fruition, hasn't actually been codified. So I think they're gun shy to believe that these will hold up in court, that this will continue to happen, or frankly that their fellow members of Congress will allow the fiscal hawks to actually codify these cuts, to codify these transparent, honest fixes you're talking about to make sure that we can stop this wasteful spending going forward. And I think that's why their mindset is still stuck in that viewpoint.

[Newt Gingrich]

It's fascinating to me because when we passed welfare reform and we invented Medicare Advantage, these things were real. This wasn't just some pious resolution. And they stuck. I mean, eventually the liberals tried to gradually walk back requiring people to work, but on balance, they had a huge impact. The largest increase of children leaving poverty as their parents got jobs. If we had had this information when I was speaker and we could go to the country and say not one penny for crooks. That's a pretty good battle cry for explaining what you're trying to do. I look back at it, we were the only four consecutive balanced budgets in the last hundred years. But we did it by a combination of real reforms. Which is why I'm very intrigued with what Elon is doing, because Elon is in doge is creating the information base by which we could win a huge argument with the American people basically on a choice. I mean, if you want to continue paying crooks, vote Democrat. If you would like to save the money and only give it to people who are honest, then vote Republican. Just strikes me that that would be such a relatively easy structure for a campaign. Boy, it's really hard to get House and Senate Republicans to understand it.

[Richard Stern]

Oh, absolutely. I think the best description I've heard is it's like herding mercurial cats. But to your point on that, you know, I think that in the 90s you had something of a workable partner on the other side. It's not that the left weren't still crooks. It's not that they weren't funneling your tax dollars to left wing organizations. That was still going on. The way that I view it is the Democrat Party of the time was still a chiefly American party in terms of their values and their views. They just liked big government and they didn't care as much about debt. I think the problem we've got now is that so much of the other side is just wrapped in this cultural transformation of the country into this wokeness, into this attempt, frankly, to create an autocratic society that's devoid of any traditional American values. And so it means that to actually get real reform to deal with the corruption, you don't just need a majority of Congress. You need to have a near unanimous vote from the group of Congress that still believes in American values, that still believes in honesty and transparency and respecting taxpayer dollars. And so it's that unanimity you need from the people who still care that is the problem. Because the entire other side no longer is ashamed that there's corruption. They live for that corruption. We've seen it in their protests, barricading doors to usaid, where they have actually actively defended the money laundering and the corruption. And I think that might be the most tragic thing that has changed in American politics in these last few decades.

[Newt Gingrich]

Correct me if you don't agree with this. It seems to me you've got two different patterns emerging among Democrats. One is kind of a we want the money pattern, and they don't actually care whether 20 or 30 or 40% of it's totally inappropriate as long as they get theirs. And the other is the most radical elements. It's almost a religion. They believe it so deeply and it's so ingrained. They can't learn from defeat because they have to reject the whole proposition of having been defeated and say, yes, but we are of the true faith and the true faith will endure. I mean, does that two part model make sense to you?

[Richard Stern]

I think you've hit the nail right on the head there. And, you know, part of that problem, of course, is that because, as you said, they're now zealots. For them, a defeat or an embarrassment is merely a minor setback on what they view as a grand path to this religious conversion of the country. And I think you're absolutely correct about that. And that's part of what is so sad to see. I think even when Bill Clinton was president, he wasn't a pure socialist. He certainly supported things that were socialistic. But to your point, now, I think they're willing to take their money even if 90% of it is inappropriate, because they truly believe in moving the ownership of everything in the country into the hands of their preferred bureaucrats. They believe in effectively conveying titles of nobility to the business people, to the soroses of the world, who they would like to have running everything. And that is that fundamental shift to a party that, as I said, frankly, doesn't share any real American values anymore.

[Newt Gingrich]

Which means that, you know, there are 13 congressional districts with Democrats that Trump carried. There are 21 more with Democrats that Trump got within 5%. With the kind of information we're getting from Elon Musk and the Doge Project, it seems to me that the pressure on those vulnerable Democrats could become almost unbearable in terms of they're either going to vote with us or they're going to get voted out. What do you think?

[Richard Stern]

I think that certainly opens up pressure that we haven't seen before and haven't had before. I think, keep in mind, of course, on the other side of that, their leadership knows that and is holding out these massive carrots to them, frankly, holding out carrots to their donors, to their business owners, saying, we will give you more and more taxpayer funding. And so I think that they're looking at this balance of what you're talking about, that Trump has stirred up a cultural movement. They can flip their districts, and they're looking at that against their own leadership, who is promising, frankly, to use the Deep State to send more benefits their way into that of their donors. I think how that shakes out, certainly in 2026 and 2028, is going to perhaps direct the entire future of the country, whether we can get those votes or not. I'd add in as well, of course, as a lingering issue. The failure to get the Census back in 2020 to account for illegal immigrants is the other reason why Republicans are down perhaps a dozen and a half seats in the House of Representatives. And while we still have five years before the next census, that is going to continue to be a major issue that the left is going to hope to capitalize on again.

[Newt Gingrich]

I mean, don't we need to pass a law that says you only count legal citizens and green card holders? If somebody's there illegally, why are you counting them? They're not supposed to be there.

[Richard Stern]

Exactly. And the Trump admin tried, through rulemaking to do it. And quite frankly, and I know the people that were there trying to do this, the Deep State stopped them. I mean, just as a horror story of this, the career civil servants, and I use the term servant loosely, who worked on that rule intentionally put in things that the courts would strike down about it, just so that when it failed in court and. And they didn't have time to change it again, they then went back to the politicos and said, we intentionally did this. We intentionally failed at our job to tank this rule to keep illegal aliens being counted in the census, and they could not be disciplined or fired because of the bulwark of laws that protect the federal civil service. This is one of those stories that I think everybody needs to hear about exactly how entrenched and how protected the Deep State is and exactly how nefarious their activities are. Usaid, of course, is yet another one of those, but a more recent one.

[Newt Gingrich]

I've been telling people that one of the things that distinguishes Reagan from Trump is that Reagan was the most conservative president within the framework of the establishment. Trump has now, I think, partly being radicalized by 2020 and the treatment he got after 2020, partly his entire team, some 400 people who were at the America First Policy Institute and then the folks who are at Heritage and elsewhere. Somehow under Biden, there was a collective radicalization that said the system really is sick. They are really dedicated to values which will destroy America. They are so incompetent that what they're doing, whether it's Afghanistan or they're spending money, that all of this has to be changed profoundly. And so you now have a president who I think in his first month is already the most consequential president since fdr. And if he keeps going at this rate, he'll presently be the most consequential president after Washington and Lincoln, because he may well literally break up an establishment which has been here now since 1933.

[Richard Stern]

I think you're right about that. I think the other president I compare him to is Andrew Jackson. And again, this is one of these where I think in some ways Andrew Jackson is underrated because he did precisely the same thing. He broke up the establishment at the time. He got rid of an enormous amount of federal central planning of the economy, getting rid of the federal bank, things of that nature, in making sure that the vote went out to everyone, not just people who own property. And so it's one of those where I think if Andrew Jackson had not broken up the DC establishment that way, it probably would have derailed all of the things that have been great that the US has achieved since the 1830s. So I think he's a little underrated because I think people have taken for granted what he did to get America on its path to manifest destiny is to being that beacon for the world. And I think we're looking at again yet another entrenched establishment that can derail for perhaps centuries the future the US is on the path for. And I think to your point, Trump is exactly the person who comes fully outside of the establishment who can break them up and then re return that power to the people, to the States and get us back on course for an even greater future.

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[Newt Gingrich]

I couldn't agree with you more. When we were thinking through the election of 1994 and creating the Contract with America, we used Remini's the election of 1828, which was a great study of Jackson, who, remember, feels that he came in first, he had about 40%, but the other two candidates ganged up on him. And so in his mind, much like Trump's attitude towards the 2020 election, you know, he had been denied what should have been the presidency which radicalized him. And then they waged war for four years. That campaign is one of the most amazing campaigns in American history. And of course, in exactly the establishment tradition, the largest single institution in the country was the bank of the United States and it had to be rechartered. This charter was running out and Jackson blocked it. And I mean, that was a real all out fight over the nature of America and whether we should be dominated by a single big bank or we should in fact have a series of state banks. And you can argue later theoretically that there are a lot of downsides to the state bank model. But in terms of a profound shift of power and a willingness to take on the sort of country club, Yale, Harvard crowd, to use our modern version, Jackson is absolutely an archetype for what Trump has been doing, except that I think Trump's more methodical, actually bolder and more determined to break up the system on a much broader basis than Jackson would have ever dreamed of.

[Richard Stern]

Oh, I agree. But I think the bulwark that Jackson was looking at was still in its crib. And so Jackson, I think, did that great gift by breaking up this establishment, by breaking up the banks of what you're talking about, prior to it becoming fatal to the US we have now tragically seen 50, almost 60 years of the expansion of the regulatory state, the welfare state, things that you were able, obviously, to have an enormous impact in blunting the growth of in the 90s. But they still are there, they've still grown. And of course, we're now at the point where the federal government consumes a quarter of every dollar earned in America with the code of regulations is quite literally hundreds of thousands of pages long. The cost of regulations might be as high as $50,000 per American household, if not higher, in fact. So I think to your point on that, yes, Trump and his team, I think, are bolder, they're more methodical, but the threat is also larger. Jackson, fortunately, was dealing with it in its infancy. It's now a very strong adult right now. But it is that two centuries later return of this imperial city, deep state that seeks to control everything again, completely opposite the founding values of the founding fathers of the American Revolution. Again, I think if we fail here, hundreds of years from now, people will remember this as the moment we lost that fight. If we win here, tragically, they'll probably take it for granted, but will know that we have saved the republic and put it back on course, the greatness.

[Newt Gingrich]

In order to win here, they have to so thoroughly educate the American people about how sick the system is that I suspect for two generations there'll be this sense of awe that, one, that it got that bad, and two, that a handful of people had the guts to fix it. I think in that sense, you and I are privileged to be living in a period that's really, truly remarkable.

[Richard Stern]

Oh, absolutely. Agree. You know, the other thing that I think is going to be interesting in that, of course, is that the last time this happened, at other periods in US History, we went to an education system that was more government run, that was more about public schools. Obviously, some of these reforms even Teddy Roosevelt made were right before the beginning of universal public schooling. Now, I think we're looking at the start of a revolution back towards homeschooling, towards microschooling I like to call cul de sac schooling. And I think that's going to help as well, because to your point of the importance of making sure that everybody sees the darkness, the manipulation, that they understand what the fight is, that homeschooling revolution is going to ensure. I think the generations of Americans to come will really understand all of these things, the level of depravity, frankly, of the deep state. And that will continue that legacy and those values, I think, for generations to come and make it easier, frankly, to not relapse and let the deep state come back again.

[Newt Gingrich]

Let me put you on the spot and ask you, what advice would you give to Speaker Mike Johnson?

[Richard Stern]

The advice I'd give to him is to continue to be bold on this. I think he and his team have obviously tried to chart out a course here. They can do, as Trump said, his one big beautiful package. But the advice I'd give him, frankly, is be bolder about it and be bolder. The way you're talking about, really go to the American public and explain what's going on. We've talked here a little bit about some of the numbers and the brass tacks about, you know, mechanically what reconciliation is. But most of the conversation you and I have had have been about these high minded philosophical things, where we are in time, what that will mean, how that will echo into eternity. I think Johnson needs to do the same thing, take the case to the American public, make it in terms that are not about the numbers and sense, but are about the values that underlie the numbers in a budget.

[Newt Gingrich]

I think that's tremendous advice. I really drew whatever little I know about politics from three major sources. One was Lincoln, who said that with public sentiment, nothing can be defeated or nothing can fail. Without public sentiment, nothing can succeed. Reagan, who said at the end of his farewell address, people said I won great legislative victories, but it was you, the American people, who won them. And you may remember that in passing the Reagan tax cut in the House, he gave an Oval Office address explaining what was involved. Tip O' Neill thought he was ahead by 26 votes and within four days he was behind by 46. So Reagan had had a 72 vote swing in the House based on one speech. And the third example is Margaret Thatcher, who said, first you win the argument, then you win the vote. And I think the importance of what we're going through, the importance of reconciliation. I've been telling people, if you're going to have a revolutionary president, you have to have a revolutionary Congress. And in both the House and Senate right now, Republicans are too timid. And they need to realize that they're at a historic inflection point at a crossroads of enormous opportunity and just go for it.

[Richard Stern]

Absolutely. My version of that story is that what you need are visionary leaders. And I think that you always certainly in a body as large as Congress, you'll always get people who might vote the right way but will be timid doing it. Those 76 votes that shifted over, I'm sure did it with some doubts. But they had a revolutionary and visionary leader in the form of Reagan. And I think again here, Trump is that as well Johnson can be. And I think that's the important thing that matters. To your point that Thatcher did, that Lincoln did, that Reagan did was they cast a vision for the American public and for Congress of what the future could look like. They weren't just there to warm the seat. They weren't just there to shepherd things through Congress. They were there to paint a boundary bold image of what the country meant, of what it can mean and what it can achieve in the future if we have the faith today to take those hard votes and to make those hard decisions.

[Newt Gingrich]

I couldn't agree with you more. You know, Richard, I really want to thank you for joining me. You know so much about this and our listeners can follow your work at the Heritage foundation by visiting heritage.org and this has really been rifing a very, very helpful conversation.

[Richard Stern]

Well, thank you so much for having me on. It's been a pleasure and I always love to have these opportunities to really get into what's going on and how to think about it.

[Newt Gingrich]

Thank you to my guest, Richard Stern. You can learn more about the Heritage foundation on our show [e-mail] Newtsworld is produced by Gingrich360 and iHeartMedia. Our executive producer producer is Garn Z Sloan. Our researcher is Rachel Peterson. The artwork for the show was created by Steve Pendley. Special thanks to the team at Gingrich360 if you've been enjoying Newts World, I hope you'll go to Apple Podcast and both rate us with five stars and give us a review so others can learn what it's all about. Right now, listeners of Newtsworld can sign up for my three free weekly columns at Gamers 360 Newsletter. I'm Newt Gingrich. This is Newt's World.

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