The Clay Travis and Buck Sexton Show - Episode Summary

Title: Bonus: Democrats’ Approval Hits 35-Year Low | Cruz’s $1 Trillion Spending Cut Plan | Poker Tax Fix
Release Date: July 29, 2025
Host: Ben Ferguson
Guest: Senator Ted Cruz
Publisher: iHeartPodcasts

1. Democrats’ Approval Hits a 35-Year Low

Discussion Overview:
Ben Ferguson welcomes Senator Ted Cruz to discuss the startling decline in Democratic approval ratings, citing a Wall Street Journal poll that reveals the party's lowest standing in 35 years.

Key Points:

• Poll Results:

  • Ben Ferguson [00:36]: Introduces the topic of Democrats' plummeting approval ratings.
  • Ted Cruz [00:53]: "The Wall Street Journal just did a poll and found that the Democrats approval rating has plummeted. It is at the lowest level in 35 years."

• Reasons for Decline:

  • Extreme Party Members: Cruz attributes the decline to the presence of extreme members like AOC and Alexandria Ocasio-Cortez, who have overshadowed moderate voices.
  • Negative Platform: "Being angry filled rage and being a party that stands for nothing but hating Donald Trump is not actually a popular platform."

• Impact on Elections:

  • The low approval poses significant challenges for upcoming elections in 2026 and beyond.

• Poll Statistics:

  • Ted Cruz [07:03]: "63% of voters hold an unfavorable view of the Democratic Party, the highest share in Journal polls dating to 1990, and 30 percentage points higher than the 33% who hold a favorable view."
  • Comparison: Democrats at -30, President Trump at +7, Republicans at +11.

Notable Quote:
Ted Cruz [04:48]: "There is nobody in the party. Name one prominent Democrat who has stood up to Comrade Mondame."

2. Cruz’s $1 Trillion Spending Cut Plan

Discussion Overview:
Senator Cruz introduces his proposal to significantly reduce federal spending by ending the Federal Reserve's payments on bank reserves, aiming to save over $1 trillion in the next decade.

Key Points:

• Proposal Details:

  • Ted Cruz [10:10]: "This is an idea that I went to the White House, went to the Oval Office, and I pitched to President Trump in the middle of the one big beautiful bill."
  • Savings Potential: "If we do what I'm suggesting, we could save over $1 trillion over the next 10 years."

• Mechanism:

  • Interest on Reserves: Banks currently earn interest for holding reserves at the Federal Reserve. Ending these payments would discourage banks from parking excess funds, encouraging them to lend more to businesses and consumers.
  • Historical Context:
    • Ted Cruz [16:40]: "From 1913 to 2007, banks kept reserves with the Fed and earned zero interest. Since 2008, the Fed has been paying interest, which has ballooned to $168 billion last year."

• Pushback and Challenges:

  • Resistance from Banks: Banks, including foreign ones, benefit significantly from these payments. Cruz recounts a conversation with a major bank CEO who opposed the proposal, arguing it would force banks to buy Treasuries instead of parking money at the Fed.
  • Ted Cruz [18:53]: "Another fact that's gonna blow your mind. Of the $168 billion that the Fed paid last year in interest on reserves, roughly half of that, nearly 50%, went to foreign banks."

• Economic Implications:

  • Redirecting funds from reserves to loans could stimulate economic growth by increasing the availability of credit.
  • Potential Risks: Higher tariffs maintained indefinitely could lead to economic downturns and recessions.

Notable Quote:
Ted Cruz [21:07]: "168 billion... Nearly 50% went to foreign banks. So not even American banks. Foreign banks getting tens of billions of dollars of US Taxpayer money every year."

3. Poker Tax Fix

Discussion Overview:
Senator Cruz addresses an unintended provision in the recently passed "one big beautiful bill" that adversely affects professional poker players by altering how gambling losses are deducted from taxes.

Key Points:

• The Provision’s Impact:

  • Current Law: Gamblers can deduct 100% of their losses from their winnings, paying taxes only on their net profit.
  • New Law: Limits deductions to 90% of losses, meaning gamblers may owe taxes even if they break even or have minimal profits.

• Personal Anecdotes:

  • Ted Cruz [35:45]: Shares his experiences playing poker with legends like Doyle Brunson and Phil Hellmuth, emphasizing the strategic and economic importance of poker professionals.
  • Impact Example: "Under the new law, you lose 100 grand that year, you make 130, you could only deduct 90% of the hundred grand you lost, which means instead of paying taxes on the 30 grand you made, you would pay taxes on 40 grand."

• Fairness and Industry Impact:

  • The provision disproportionately penalizes professional gamblers, potentially driving them out of the U.S. poker scene.
  • Bipartisan Effort to Fix: Cruz collaborates with two Nevada Democratic senators and a Republican senator to amend the tax code, aiming to restore fair treatment for gambling professionals.

• Legislative Challenges:

  • Despite bipartisan support for the fix, changing tax laws is inherently complex, and Cruz remains optimistic yet realistic about the possibility of success.

Notable Quote:
Ted Cruz [35:49]: "Under the new law, you lose 100 grand that year, you make 130, you could only deduct 90% of the hundred grand you lost, which means instead of paying taxes on the 30 grand you made, you would pay taxes on 40 grand. That is wildly unfair."

4. Political Dynamics and Future Concerns

Discussion Overview:
Cruz delves into the broader political landscape, expressing concerns about Republican complacency despite current successes and the energized but potentially volatile Democratic base.

Key Points:

• Republican Complacency:

  • Ted Cruz [10:10]: "The danger from a political perspective is that our guys get complacent. Okay, we're winning. Everything's taken care of. It's not urgent anymore."
  • Reduced fundraising and voter turnout could jeopardize future Republican victories.

• Democratic Overdrive:

  • Despite low approval, Democratic fundraising is robust due to high negative sentiment towards Donald Trump, potentially sustaining their base's energy.

• Economic Policies and Tariffs:

  • Cruz highlights internal conflicts within the Trump administration regarding the use of tariffs as leverage versus maintaining high tariffs, which could impact the economy's trajectory and influence upcoming elections.

Notable Quote:
Ted Cruz [08:16]: "When you say as a party, hey, let's be for open borders and Venezuelan gang members and releasing criminals and rapists and child molesters, that is a really, really unpopular position."

5. Conclusion and Calls to Action

Summary of Actions:

• Spending Cut Legislation: Cruz encourages continued efforts to pass his spending cut plan in future reconciliation bills.
• Poker Tax Legislation: Emphasizes the importance of bipartisan support to rectify the unfair tax provisions affecting poker professionals.
• Economic Responsibility: Advocates for policies that promote fiscal responsibility and support economic growth through sensible regulation.

Final Thoughts: Senator Cruz underscores the necessity of maintaining party unity, avoiding complacency, and addressing legislative oversights to ensure fair and effective governance. He remains committed to advocating for policies that benefit the broader American populace and uphold economic integrity.

Notable Quotes from the Episode:

• Ted Cruz [00:53]: "Being angry filled rage and being a party that stands for nothing but hating Donald Trump is not actually a popular platform."

• Ted Cruz [21:07]: "Of the $168 billion that the Fed paid last year in interest on reserves, roughly half of that, nearly 50%, went to foreign banks."

• Ted Cruz [35:49]: "Under the new law, you lose 100 grand that year, you make 130, you could only deduct 90% of the hundred grand you lost... That is wildly unfair."

Episode Takeaways:

• Democratic Decline: The Democratic Party faces significant challenges due to internal extremism and declining voter approval, posing risks for future elections.
• Fiscal Responsibility: Senator Cruz proposes a substantial spending cut plan targeting Federal Reserve policies, aiming to redirect funds towards economic growth.
• Tax Fairness: Addressing unintended legislative consequences is crucial for maintaining fairness and supporting professional industries like poker.
• Political Vigilance: Both parties must remain vigilant against complacency and ensure policies reflect the interests and fairness towards all constituents.

This episode provides a comprehensive analysis of current political dynamics, fiscal policies, and legislative challenges, offering listeners valuable insights into the strategies and concerns shaping the American political landscape.