Facts and Math
Floor Speech
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Mr. SCHWEIKERT. Mr. Speaker, I missed all of you now that we are back. I get teased back home of doing these things that seem more like an economics lecture. That is actually not the goal here. It is actually just to sort of walk through the reality of the math because so much of this body is about theater and not about facts.
As my wife a decade ago said: David, you get to go and hang out in a math-free zone.
Let's have some fun with facts and math.
Mr. Speaker, next year, the 2026 fiscal year, 3 weeks away, take a guess: For every dollar of tax collections--for every dollar of tax collections we get next year, what are we going to spend?
For every dollar of tax collections we take in next year, we are going to spend $1.43. This one number right here should scare the hell out of people. Instead, the hallways around here are full of people demanding more spending. Just a little while ago in my office there were more people saying: Can you get us a grant? Can you get us more money? Can you regulate our competition?
For every dollar of tax collections this year--we still have 3 more weeks before the fiscal year is over--my estimate is that we are going to spend $1.39. Next year, it is $1.43.
How long do you intend for this to go on?
Here is your problem: Most of that increase in spending is not some sort of crazy this or crazy that. It is interest. Remember, interest rates are up. We still have to finance about $10 trillion of refinance this year, and we are going to bring about $2.4 trillion or $2.3 trillion in total new debt this year.
Next year, the baseline was we are going to borrow $2.5 trillion. It is probably going to be less $300 billion because of customs duties, tariffs. Yet, here is something I beg of everyone. Whether you are on the left or the right, burn this into your psyche: We borrow about $70,000 to $72,000 every second, and almost all of the growth in that borrowing is interest and healthcare costs.
Mr. Speaker, I am sorry. Forgive me. I enjoy tormenting you. I don't mean to.
Think of this: In 7 years, the Social Security trust fund is empty. Under the law--under the law, grandma takes a 24 percent cut in her check. In 7 years, we double senior poverty in America.
Yet, if you are an idiot like I am, and you get up and say: We really should work on this. The Democrat consultants are going to beat the crap out of a Republican and vice versa for even mentioning the fact about the math. It is not Republican math. It is not Democrat math. It is in the Social Security actuary report.
In 7 years, the Medicare trust fund is empty. If you are running a hospital or one of these where the part A trust fund is your revenue source, you get an 11 percent cut. In 7 years.
This year, we are going to spend $1 trillion on Medicare. In 7 years, we spend $2 trillion. It doubles in 7 years. It is demographics. It is not personal. It is not Republican-Democrat. It is what we are as a society.
We have the same number of 18-year-olds today as we had 20 years ago, but we have double the number of our brothers and sisters who are 65. It is math.
Behind these microphones this week, how many people have come up and actually talked about math, about the demographics, about the economic future? I would argue that understanding the math is moral. Is it moral to look the other way and in 7 years double senior poverty?
Yet, you will get the living crap kicked out of you around here if you actually tell the truth about the math because we have spent so many decades lying to the American people.
Mr. Speaker, I have this board I have used for a while. It was saying that right now we are borrowing $6 billion a day. I apologize. This number is wrong. We are borrowing $6.5 billion dollars a day, and there is the theatric problem.
You get people saying: I am going to save a couple hundred million dollars. That is wonderful. Let's see. If I am doing $6.5 billion a day, that is almost $270 million an hour. There is the fraud around here. It is the inability to understand the scale of what is going on.
Let's understand that borrowing is a tax. It is a tax paid for in the future with your retirement, my kids, but it is a tax paid with interest.
We have a society who so desperately wants free stuff. They want money. The 100 times I have come behind this microphone and show the charts saying, I want every dime of my Social Security. Of course. Of course. Most people don't realize the Social Security formula actually is progressive. If you are a high-income earner, you get less of your money. If you are lower income earner, your FICA tax, you actually get more, but in the mean, you get about a $72,000 spiff for that couple. It is a crap rate of return.
However society, the Democrats, back 20, 25 years ago decided that the idea of putting a little money into the market was a horrible idea except for the fact that now we look back 25 years later, it was a wonderful idea.
Poverty rates of return and those things would have been dramatically different, but it is too late now. We are well into the population bubble of baby boomers. The driver that we don't like to tell the truth about is that same couple for every dollar they put into Medicare, you are going to get about $6, $7 back. Most people don't realize that about 38 percent of Medicare comes from the trust fund, about 15 percent comes from your copay, the rest comes right out of the general fund.
Are we allowed to tell each other, the lobbyists, the activists, the people on social media making absolute crap up? How about our voters? Are we allowed to get in front of them and say: This is serious. This isn't a game. We right now are borrowing about $6.5 billion every single day for this fiscal year. We are down to the last 3 weeks, so you have a really good sense of what we borrowed.
In 9 budget years, it is well over $10 billion a day. Yet, a couple hours ago, I offered an amendment that basically said there is all these dollars--and I am going to talk about this probably two, three times--that were appropriated. I showed one example of money appropriated in 2015. It wasn't a huge amount of money, few million bucks, and it has never been touched. We just leave it sitting in the account. We borrowed it, we are paying interest on it, but it just sits there. That is insane. You hear budget geeks go: We should do zero- based budgeting. Absolutely, because you can say, oh, we did that. We were going to do this.
In that case, it was actually a clean coal program, but no one actually ever qualified for the grant so the cash sat there. There was like $36 billion of stuff that has been sitting in the accounts for more than a year and some for half a decade.
Yet, we are so dysfunctional, we can't actually start from the beginning and go line by line by line. It doesn't solve the problem, but it helps.
Let's actually walk through math reality. I am a Ways and Means guy. I chair Oversight Subcommittee on Ways and Means, but I also chair the Joint Economic Committee. I have a handful of Ph.D. economists that work for the committee, and we try so hard to do intellectually honest math.
Mr. Speaker, please don't tell anyone, but I am a dinosaur. I actually believe in free markets. I actually believe in the elegance of competition. We are actually going to touch a little bit on the economics of creative destruction. If you want productivity--because I am going to show in these charts where we are demographically, if we don't have an explosion of productivity, we can't make wages go up.
If you are a working person in this country today--particularly like in my Phoenix-Scottsdale area, if you are a working person today and you haven't had about a 28 percent pay hike in the last 4 years, you are poorer today.
It is called inflation. The biggest tax in modern history was those 3, 4 years of inflation because we now get to pay back our debt with inflated dollars. We are crushing people. The way you make wages go up is two things: You raise people's wages because of inflation. That just means you are treading water, or productivity.
Now some of the things we did in the reconciliation budget that we passed before break is expensing, research and development expensing, things to try to get investments to do things better, faster, cheaper, but we are going to have to have the brutal discussion of--you functionally have the same number of 18-year-olds coming in and next year it is going be lower and the next year it is going to be smaller and the year after is smaller. People like me, baby boomers, with gray hair, there is a whole bunch of us. We have got to legalize technology. Is it rational? I will say this a couple times. Is it rational to make it illegal to automate a port?
I would love to have the dockworkers and the unions love me. Maybe they would even send financial help and say nice things about me, but it is not about that. It is about the entire continuity of society, when we create these barriers for automation, for doing things better, faster, healthier, and cheaper.
If you are going to have a command and control economy, let's just admit we are populous. We want to run the economy. We want to own businesses. We don't believe in the economic theories of creative destruction, creating new, better, faster, but give up on the productivity cycle and then you tell me how people's wages go up. You have a middle class that is getting absolutely crushed and squeezed.
Their purchasing power is stagnant, if not reduced. It doesn't have to be that way, but it is going to happen through policy here. It is like no one here went to their basic elementary school economics class.
The chart here--I am going to try to make a point--is customs duties. We all talk about tariffs. I heard a Member a couple days ago say: Customs duties. Tariffs are going to pay for everything. No, they are not.
Now, they do pay for most of the big, beautiful bill. The fact of the matter is, last year we took in about $77 billion in customs duties. This year, we are going to take in, our best guess, is $190 billion.
Except the problem is, did I mention to you a little bit ago that we borrow about $6.5 billion a day? The increase in tariffs, customs duties, is going to pay for like 11 days of borrowing. Out of 365 days, we just covered 11 days of borrowing.
For anyone who is watching, much of what DOGE was doing was fascinating. Go look at DOGE.gov right now, and you will see a couple of hundred billion dollars of potential savings, though only a fraction of a fraction of a fraction has actually been executed because we in Congress can't even do basic rescissions.
We did a rescission before August. It was a total of like $9 billion, so if you are borrowing $6 billion, we covered a day and a half of borrowing. It was war here for 6 weeks to save that much money.
We are living in a mathematical delusion where people don't understand that is 12 zeros. They don't see the difference between a trillion and a billion, but the fact of the matter is, we need to start telling the truth about the math.
Let's walk through. Let's get a little more geeky. This morning, there was something called the JOLTS data. It is basically ADP's attempt to sort of take an estimate of what is happening in jobs data. There has been a lot of slop in the numbers. Look, we were beating up BLS before, but remember, we also have a response rate to the surveys that is down dramatically. Sometimes you get big revisions, and then the next month you get a little more data, and the next month you get more returns, and you can finally calculate.
In the JOLTS data, there is a fascinating number to look at. The number of jobs was fairly flat, but unemployment looks like, our best model, it is going to stay steady because we are finding we don't have as many workers looking for jobs. It is really worth taking a look at that, as we are starting to see the demographic implications of how many of our brothers and sisters are choosing to take retirement at age 62, when for years we have been looking at there are, like, 7 million prime-age males missing from the labor force.
That was actually one of the controversies when we were trying to do some of the reforms in Medicaid, saying that should we ask folks to at least look at participating in the economy and the society because, Heaven knows, we need them.
Look, this may be a little bit geeky, this chart, but the basic premise is, when you are taking a look at labor force participation, back here is the recession. We had, like, 70 percent of the population participating in the economy. Today, we are down here below 62 percent, or 62.5 was our 2025 estimate, and we believe it is going to continue to fall.
Is this people just sitting on the sidelines? No. It is more complicated. As a society, we got older. We have done entire presentations--and I know this is controversial and uncomfortable--of our brothers and sisters when you have entire States where more than half of the population qualifies as being obese. We are not being mean, but the Joint Economic Committee a few years ago did a major study saying, hey, it turns out obesity costs about $9.1 trillion of additional healthcare spending over 10 years, and there is the Milken study from a few years ago saying 47 percent of all U.S. healthcare. Maybe the morality is getting our head straight and saying we help our brothers and sisters get healthier so they can participate in the economy, so we have more labor force participation, so the economy grows, so productivity goes up, and so wages go up. However, we are incapable of a unified theory around here because it would require thinking in math.
To get a little more sarcastic, we actually are fixated on just some of the budgetary problems. We actually believe there are hundreds and hundreds of billions of dollars that are subject to rescission. They have been sitting in accounts for years. Instead, we just did an appropriations bill a little while ago, where we stacked on top of stacks.
Why is it so terrifying to the army of lobbyists, the people back home who want more money to say, hey, we are just going to look at everything because we found occasions where we are doing an appropriations that there was an appropriation done 3 or 4 years ago, and the money is still sitting in the account.
I can understand the scale, if you are borrowing $270 billion a month, maybe fixing this, but we don't have a choice. Is anyone else at least at all freaked out a little bit looking at what is happening around the world right now, what is happening to French bonds, British bonds, Japanese yields on the long end of the curve? When you see the long end of the curve going up and up, that lets you know the entire world is getting really nervous about long-term debt.
Ray Dalio, the billionaire, has been giving speeches around the country. He even wrote a book saying you have a math problem. The entire industrialized world basically is at zero to negative population growth. Our brothers and sisters who have gotten older, who are moving into their pension years, their healthcare years, where are the savings to keep financing all these governments that are borrowing? His argument is there is not enough savings for all the borrowing.
Then, you get the idiot who says: Well, we will just print the money. Of course you will. What is that thing called again? Yeah, inflation. You debase the currency. Yes, you pay for it with inflated dollars, but everything you have, your savings, become worth less. You make real estate and things more expensive, so the next generation can't buy a house. We are basically--it is an economic term--oh, yeah, we are screwing over the next generation and maybe our own retirements by not telling the truth about the math.
It doesn't have to be dystopian. There are ways to deal with this stuff. We just don't have a lot more time.
Look, we have something called the Sunset Act. We have been looking at regulations, command and control, that are woven through the economy, particularly post-Biden administration, where they regulated at breakneck speed. They are up for review. They need to be modernized.
Part of the question is, if you are going to regulate air quality, do you do it the same way you did 30 years ago, when you actually have remote sensors that can be in your pocket, or do you need the million- dollar-a-year tower to do it where you look at the entire marketplace?
The fact of the matter is, there are better, faster, cheaper ways, and much more elegant, and you get the bad actors. We have actually done some economic modeling, and it turns out we can actually add a real pop to GDP growth, the size of the economy. GDP growth is important because that is actually your living standard. When we grow, you live better.
It turns out, it is not deregulation. It is smart regulation. Find this bureaucratic control of economic growth and let's just review them. Should we still do it the same way we did 20 years ago?
Let me give you a conceptual. A year and a half ago, I met with a Phoenix-based company that is actually building a ginormous drone. They intend to do ground-penetrating lidar, radar underneath this drone.
Let's say you want to build a pipeline or a road. They are going to fly it back and forth, back and forth, back and forth, and penetrate the ground to see if there are archaeological, geological issues, these things.
At the end of the week, they claimed the AI, the artificial intelligence, can write the entire environmental and engineering report. What would it have taken for people to go out and walk the site? A couple of years.
We have already been being lobbied by, ``We are the archaeological guild. We are the geological guild,'' we are this and that because we don't want to be replaced by the technology, so it should take 2 years. We are going to do permitting reform, saying we want to do it in half the time, so we are going to have these people walk twice as fast?
That is the way this brain around here works. We are going to make it so that they walk twice as fast. Are we out of our minds?
That technology is not in the code yet. We have not legalized saying, I can let AI, even though they claim the statistics of it would be more accurate than humans out walking the site. We can do things dramatically faster.
There was a great article. I think it may have been in The Economist or the Financial Times a couple of days ago that was making the point that China has become a country of engineers. We have become a country of lawyers.
Why does it take us so long to build something? Why does it take us so long to do the things that would make us more prosperous? It sort of becomes obvious in that one line: We are a country of lawyers. Our competitors are countries of engineers.
Look, when we start looking at actual GDP growth--maybe this is a better way than using the chart. The long-run economic growth, almost all the credible economists in America say that we are going to get a nice pop in the next year or two from what we did in the reconciliation budget. Great. Then, because of our demographics, we start to hit going back to the mean. It is only like 1.8 percent GDP growth.
We cannot make it if we grow at anemic rates, but you can't do it through a bunch of handouts and subsidies. It has to be from unleashing markets. It is why I am concerned, seeing things going on where we are taking ownership interests in companies.
Look, this one is going to be uncomfortable. Let's go back 15 years ago, the Great Recession, when we bailed out a car company. Yes, we were saving jobs, except for long-run economic growth. There are some brilliant papers that have been written, saying, after a couple of years, you would have had the same number of jobs and three or four creative, smaller, innovative car companies, one doing electric, one doing sports cars, one doing--that is actually how creative destruction works in the economy. It is like a phoenix. It is the rebirth.
When you stop that rebirth from happening, you don't get to clean out the legacy headwinds, the things that are slowing down the innovation. You basically perpetuate the inefficiencies. It doesn't make you popular telling the truth, but we all knew this.
Should we have bailed out Blockbuster Video 15 years ago because there were tens of thousands of people who worked for Blockbuster? Should we have put Netflix out of business? Should we have slowed down the internet? Should we have stopped the revolution of technology where you go home now and hit a button?
You say that is absurd, David. No. It is the same sort of concept. Should government have stepped in and stopped innovation?
We have done entire presentations here where you talk about the morality of cures. If diabetes is 33 percent of all U.S. healthcare, should we spend more money on helping people maintain their misery? Probably. Should we spend what is necessary to cure the disease? What would be the economic impact?
There is a brilliant study from a couple of years ago talking about maybe one of the leading, if not the leading, contributor to income inequality in America. It is actually health, except we will get lobbied by groups that are upset saying: If you kill the disease, what happens to my business model?
This is how perverse this place has become. Where is the passion? Where is the vision? Where is the innovation? Where is the optimism?
Look, I am 63. My wife is 63. I have a 3-year-old and a 9-year-old. The 9-year-old is remarkably loud.
We are blessed. We were able to adopt. It is the most greatest joy in life.
Mathematically, my children will be part of the first generation that is going to be poorer than their parents. That is the American ethos now? The Americans' ethic is that we are going to make our kids and grandkids poorer because we want stuff? This is what we have become because we are so damn afraid to do things that are hard around here?
Look, I am going to do this slightly out of order. Ten weeks ago, when we were doing the One Big Beautiful Bill Act, part of my deal was, Mr. Speaker, that I don't like some of the things that are in here, but I really want to offer legislation to pay for it because I think there are some eloquent things we could do to offset. The deal was, okay, go ahead. See if you can get anyone to sponsor it and vote for it.
We have been chasing for over a year. Go read The Wall Street Journal articles, the MedPAC report--the amount of fraud, waste, misalignment. Some of it is perfectly legal misalignment. We are the idiots that screwed up the law in Medicare part C, or what I was talking about a little while ago, cash that has been sitting in accounts for years that could be swept that we are paying interest on.
This number is getting bigger, a talent-based immigration system. We educate people and send them home to compete with us--and the President's golden visas. It came in over $3 trillion of savings. We wrote the bills.
We had Ph.D. economists help us model them and get our numbers right. We got a preliminary number from CBO that the Medicare Advantage modernization saves $1.8 trillion, making it the biggest savings bill in U.S. history.
Mr. Speaker, guess how many cosponsors we have? Zero. Zero because it is hard, complicated, difficult to explain, but it is really good policy. There are solutions. Toughen up.
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