HOUSE OF REPRESENTATIVES

Treasury's Mnuchin says economic growth his priority, urges Congress to raise debt limit

Treasury Secretary Steven Mnuchin tried to focus on President Trump’s budget plans to create sustainable growth for all Americans at a congressional hearing Monday - but lawmakers pressed him on issues ranging from entitlement reform, the border adjustment tax and even whether cuts to the IRS were too steep.

Mnuchin opened his remarks with the assertion that the “number one priority” was creating sustainable economic growth, but conceded that would require making tough choices.

“We are currently bearing the costs of excessive government commitments of previous years, and this has forced us into hard choices,” he told members of the House Ways and Means Committee.

Committee Chairman Kevin Brady, R-Tex, however, noted that the secretary’s statement ignored or did not mention dealing with the national debt, or the need to reform Social Security and Medicare.

Mnuchin responded that he looked forward to working with the committee, but then urged them to address a more immediate priority.

“I urge you to raise the debt limit before you leave for the summer,” he said, adding that he favored moving on a “clean” bill without controversial add-ons that could complicate its passage.

In March, the Congressional Budget Office estimated that the federal government would hit the $20 trillion debt limit in the fall.

His plea for swift and smooth action could be a clue the administration is reluctant to engage in a broader and perhaps bloodier fight over the budget. 

President Trump was overseas when his first budget was released to Congress on Tuesday, leaving cabinet officials to explain the $4.1 trillion budget plan and how it would balance the budget in ten years.

Ranking committee member Richard Neal of Massachusetts cautioned the Treasury Secretary that Democrats would approach every proposal in the budget from the standpoint of whether it moves “the dial for middle class Americans.”

Less diplomatic was Rep. John Lewis, who contended the budget is simply “more money for war, for guns, for weapons,” and that it leaves the poor and vulnerable behind.

The Georgia Democrat even decried cuts to the Internal Revenue Service, insinuating the agency lacked funding to collect taxes. Mnuchin said he was “comfortable” with the IRS budget.

The Treasury Secretary fielded questions from both sides of the aisle on the border adjustment tax, which is a proposed 20 percent tax on imported goods as a way to overhaul the nation’s tax system.

House Speaker Paul Ryan and other backers contend the tax is a boost to U.S. manufacturers and could raise $1 trillion over 10 years, but opponents argue it would increase costs on everyday necessities like food, gas, clothing and prescription medicines for the average family by as much as $1,700 in the first year alone.

Michigan Democrat Sander Levin unsuccessfully pressed Mnuchin on whether he would guarantee there would be no upper class tax cut.

“The president’s objective is to have a middle income tax cut and that is consistent with what I said earlier,” responded Mnuchin.

The gentlemanly treatment given Mnuchin was a contrast to the more combative return to Capitol Hill of Secretary of Education Betsy DeVos.

Appearing before the House Appropriations Committee, DeVos said the budget reflects Trump’s desire to improve educational opportunities for all students, “while also refocusing the Federal role in education.” 

She also touted their efforts to save taxpayers $5.8 billion through the elimination or phase-out of 22 programs that are duplicative or better supported through local or philanthropic efforts.

Trump’s budget proposes cutting $10.6 billion from federal education initiatives, including after-school programs, while reinvesting $1.4 billion of the savings into promoting school choice, which includes $250 million for vouchers.

Rep. Barbara Lee, D-Callif., voiced concern about plans to cut $1.7 million from its Office of Civil Rights, which investigates discrimination complaints.

"To me, it's outrageous," she said, "for you to sit here and say that it's OK if parents and local communities discriminate. It's very sad, shocking and disappointing."