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OMB Director Mulvaney On All Things Budget…And More

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OMB Director Mick Mulvaney joined me this morning:




HH: I begin this hour with the director of the Office of Management and Budget, Director Mick Mulvaney of the wonderful state of South Carolina. Director Mulvaney, welcome back, it’s good to talk to you again. Haven’t seen you since the green room on Meet the Press.

MM: Hugh, is that Game of Thrones bumper music you’re playing?

HH: Of course, it is. We’re House of Lannister.

MM: (laughing)

HH: It’s the House of Lannister. You’re probably Starks.

MM: That’s a new one for me. No, it’s good to talk to you again.

HH: Well, that’s sort of like the West Wing. Isn’t it Game of Thrones? It’s been presented that way, at least.

MM: And a lot more parallels than people probably realize, yeah.

HH: (laughing) Let me ask you, do you have the votes to pass Obamacare repeal and replace in the House today?

MM: Yeah. Everybody I talk to says yes. All the folks I talked to who are no are yes. I think they’re going to get everybody but one in the Freedom Caucus, and they might get that one. And I think yesterday, the deal that Fred Upton and Billy Long came up with was enough to satisfy enough moderates. So they say that there are going to be about 15 noes, which is enough to pass. My guess is when it goes on the board, a lot of folks who said they were no will be yes. The margin might actually be a little bit larger.

HH: Now Director Mulvaney, if Senate Leader McConnell takes that and says we’re just going to, and gets 52 Republicans to sign a letter saying we’re going to vote this thing yes up, straight up unless you engage in serious negotiations on a number of things, Chuck Schumer, including the border wall, including immigration reform, including Defense sequestration, including entitlement reform, he’ll have a hell of a lot of leverage, won’t he?

MM: He will, and he needs to do something. I don’t know if that threat is viable, just given the telegraphing that several members of the Senate have already done on the House version of the bill. But your point is an excellent one, which is that the Senate has to do something different to break the stalemate. I mean, we’re still not full on our cabinet, believe it or not. I think Mr. Lighthizer at USTR is still not yet confirmed, and here we are in the middle of May. The appropriations process from all indications is not going to get back to regular order in the Senate this year, which means we’ll be back again in September at another CR omnibus discussion. The Senate is broken, and whatever Mitch McConnell can do to fix it, he needs to do, because well, just because the country needs it.

HH: And I think if the 52 Republicans would just act like a party for once and sign a letter saying this is an up vote, this is passing as is unless you get down to business with us, and a team from the administration, you know, six from the House, six from the Senate, 12 from the administration, and a massive bill covering all of the urgent priorities gets done. I think that is possible, Mick Mulvaney. You’d be a part of that. Good luck on that. Let me start with a specific and move to the general.

MM: Sure.

HH: Have you named an office of information and regulatory affairs assistant director of OMB, yet, because that position is so important.

MM: The assistant director? No. We’ve named a director, who is Neomi Rao. And in fact, I just met with her this week, and I wanted her to be involved in the process of picking her assistant. And I think we’re looking at that. We’re in that process right now. Of course, she’s not confirmed, yet, so it’s sort of putting the cart before the horse to name her assistant before she gets confirmed.

HH: Okay, so tell me about Neomi and what she brings to the job that Cass Sunstein used to rule basically the executive branch.

MM: Oh, and she’s fantastic. She is an academic, but this is her specialty in regulatory reform. I think she’s at George Mason. I always get those Northern Virginia schools all messed up, but she runs the office of, or the Institute of Regulatory Policy out there, something she founded. There’s an excellent Wall Street Journal, I think that Cass Sunstein may have written an op-ed right after she was named that said the name, and I could be getting that wrong, but it was someone prominent who wrote an article in the Wall Street Journal right after Neomi was named that said this more than anything sends the message that Donald Trump is absolutely serious about regulatory reform. So we’re very excited about having her on. Folks don’t know if the office of regulatory affairs, actually information that regulatory affairs does, you can call it OIRA, another really bad name for an agency. But it touches every single regulation in and out of the government, and it’s a tremendously important job. And to have her there is going to be a big win for us.

HH: Let me talk to you a little bit about the Congressional Review Act. I think the President will sign his 14th CRA bill today or tomorrow. Am I right about that, Mick Mulvaney?

MM: That’s right. yeah, 14, and we’ve got 13 in the bag already. It’ll be 14 this week.

HH: These are enormously important. I talked about this with Speaker Ryan yesterday. I don’t think the public quite gets them, but they bar the door to agencies returning to the burned over ground of the rule that has been revoked by the Congress. That’s why they’re so significant.

MM: That’s right, and people do focus on the fact that they undo something that President Obama’s administration tried to do or did, but not only that, they prevent that agency from ever doing something similar or the same in the future forever. So it’s a permanent limitation on the power of the regulatory state, and we think that is one of those unsung victories of the first 100 days, having 13 of those in the bag and still going strong.

HH: And the door is barred unless and until Congress authorized that it go forward, which brings me to my proposition. President Obama signed the Paris Agreement on September the 3rd, 2016. It went into force on November the 4th, 2016. You were still within the CRA window to take a resolution through the House and Senate to revoke the Paris Agreement and bar executive agency unilateral action on carbon emissions without Congressional authority. Will you propose that, Mick Mulvaney, and ask the House and Senate to do that?

MM: Well, we’ve already looked at it. In fact, there was a meeting of all of the lawyers yesterday. I was not in on that. I was in another meeting dealing with the budget. But we’re trying to figure out if Paris, the Paris Agreement is subject to CRA review. There is a school of thought that it is not. The effective date is actually outside the CRA lookback window, and again, I just put half of our audience to sleep. But there is an, at least an argument to be made for it not being suitable for CRA, so we’re looking at other options on how to get out of it. Is it a treaty, for example? Should it be approved by the Senate, which it was never done? So we are absolutely looking at all of the angles. The CRA is one of them, but by no means the only.

HH: I have looked at it, so you can tell the lawyers that the best lawyer that you know says it’s inside the CRA window, and what the hell, why not pass it anyway, because there’s no downside to it? That’s my view.

MM: I’m a big fan of asking for forgiveness instead of permission.

HH: Exactly. You pass it and you say it’s over, it’s done, and then the courts can work it out. Let’s go to the budget, Mick Mulvaney. Big win for you. It will pass the Senate today. It passed the House last night. But my own beef with it is shipbuilding. The President has promised a 350 ship Navy. This first $1 trillion, $1.1 trillion dollar budget, does not add even one complete extra ship. He’ll never get to 350 ships under this budget. What do you say?

MM: It’s funny, you did not say that you were going to mention that, so this is by pure coincidence. The reason I wasn’t at the Paris meeting yesterday was that I was at a meeting about the ships. And I’m not making that up.

HH: (laughing)

MM: Here’s where we stand, because there’s a discussion right now on whether or not we add some additional littoral combat ships, which are, well, sort of the shallow water Navy, the smaller ships. You know what they are, but anyway…

HH: Yeah.

MM: We did not add any of those as part of this $21 billion dollar request. And there’s a really healthy and positive debate on that, and here’s one of the issues. The Navy doesn’t want them.

HH: They don’t want the LCS.

MM: Right.

HH: It’s a crappy ship. They need frigates…

MM: They do…

HH: But you could repurpose Marinette, the shipbuilding place in Wisconsin, to build those frigates instead of the crappy LCS.

MM: All of what you just said is true. Of course, I’m not going to say crappy LCS. The people who make it are probably listening. But, so I won’t endorse that line of reasoning, but here’s the point. It does take time to do that. So can you get it done with the money from this ’17 OCO budget? Remember what we passed, the House passed yesterday, in a deal the President negotiated over the last couple of weeks, is only for the last five months of the fiscal ’17 year, which is from now until the end of September. And there’s very little we can do in that window to convert from LCS to frigates, or to do much shipbuilding at all. So the bigger debate about starting on that road to a 350 ship Navy is actually part of the ’18 budget. And in that budget, which we’re working on today, as a matter of fact, you will see additional shipbuilding.

HH: And will we see a plan to get to 350 by 2024, which is what the President promised?

MM: We’re working on it. I’ll be honest with you. It’s hard to get to 350 ships in seven years, just because we don’t have the capacity to do that right now.

HH: Actually, you know, you’ve got to go read the piece by Robert O’Brien and by Jerry Hendrix in Politico. They lay it out, the ghost ship fleet, etc. Spend the money, Mr. Mulvaney. Spend the money. Let’s go to the fence, because this really ticks me off. There’s a sneer on the, by people who don’t want any fencing at all, that there’s not enough fencing. I think a billion and a half dollars to go back and replace traffic barriers with serious barriers, some of them walls, some of them fences, is real. But they’re mocking it. What’s your response to them?

MM: Try and get through it, I guess, would be my response.

HH: (laughing)

MM: (laughing)

HH: How many miles will it cover of the repairs, because it’s only a billion and a half. It’s not the full wall. It’s a billion and a half of repairs on existing traffic barrier and cyclone fence into the real deal stuff that works in San Diego. How many miles of it will it cover?

MM: And we don’t measure in terms of miles. We’re measuring in terms of dollars right now, because we haven’t got the costs down. Keep in mind it is technically for maintenance, and that’s why the Democrats though they got such a win and thought they pulled one over on us, because they didn’t let us build any new brick and mortar wall. And what we figured out during the negotiation, and the reason we were able to close this deal, was that we figured out that maintenance allowed us to rip out old fence and put in new fence that technically, the way the statutes are written, that constitutes maintenance. So what we’re going to do is find all these places where the wall is just a complete piece of junk, rip it out and replace it with these 20 foot high steel bollard walls, which are the walls, by the way, that I think a couple of people were mimicking them for oh, you can see through them and all this kind of stuff. The DHS, Homeland Security, prefers those bollard walls to the concrete walls for exactly that reason. The border patrol agents can see through them, see what’s going on, on the other side, and it also prevents attacks on them. We actually have border patrol agents who are, who have been assaulted by people throwing things over the fence at them. And that goes away when you go to this bollard wall.

HH: And that bollard wall, if they replace those traffic barriers with, I just hope you do a before and after video, and that you measure it in miles, because Americans understand miles of fence. And if it’s 40 or 50…

MM: Yeah, we did it, we did it in the press conference, actually put in a couple of places today, as a matter of fact, so here we are, you know, we’re getting ready to sign the bill, and we’re already moving out in the field. We’re replacing the cyclone chain link fence with these walls. We’re got pictures of places where the drug smugglers and the coyotes have actually built bridges over our little four foot high fences. We’re replacing that with a 20 foot high wall.

HH: Oh, please do the video before and after. And let me ask you about, you know, you’re very patient with the media. Yesterday, someone said what about tunnels, what about tunnels, and I thought to myself, does that idiot think they’re flying the fentanyl into O’Hare? Do they think it’s landing at LaGuardia? They’re driving it across the desert, in many places.

MM: Yeah.

HH: Yes, tunnels are a problem, but this isn’t a 100% solution. This is a 75% solution.

MM: Yeah, I mean, I could have said to the guy well, you know, they could take a helicopter over it, too, if they wanted to. So I mean, yeah, the wall doesn’t solve 100% of your problem, but boy, does it solve a lot of it. And by the way, by the way, even without any of that additional fence on the ground, yet, the President in his policies has already lowered the flow of people and drugs across the border just by sending the message that we are actually enforcing the border again.

HH: Yes.

MM: It’s reduced crossings dramatically just in the first 105 days of this administration.

HH: Last question….

MM: So there are a bunch of ways to keep bad people out, and we’re doing it.

HH: Last question, hobby horse for Hugh Hewitt. We’re, I care about judges. We’ve got the Supreme Court Justice. Great. We have one nominee of 120. Once they get on the bench, we’ve got to keep them there, Mick Mulvaney. Judicial pay is not where it is. Will the 2018 budget have a significant hike for judges so that those we get confirmed can stay and put their kids through college?

MM: Yeah, I don’t know if we’re looking at a significant hike all at one time. We are aware of a bunch of different places in the government where I know it sounds awful to say this, but we just, we can’t get good people. And the judiciary is part of them. The difference now between, well, look at this, I’ll put it to you this way. When I was looking to fill some of the key positions here at OMB, and you talk about the OIRA position, talk about the deputy for management, I had some big names. I won’t name them, but you would recognize every single one of them. And a couple of them just said to me, look, Mr. Mulvaney, I’ve got three kids in grade school. I can’t afford to take the pay cut. And it was an 80% pay cut over what they’re taking.

HH: Yeah.

MM: And listen, I’m all for government service. It’s why I’m doing it here. I feel like I could make more money doing something else, but I’m having a great time doing this, and glad that I’m doing it. But not everybody’s in a position to do that. And I think the service to the taxpayers suffers at a result.

HH: And the judges, they’re lifetime appointments. We’ve got to keep these originalists that we put on. And so I’m just begging you, if it can be 20, 30, 40, 50%, it is worth it to the country and to the Constitution to pay them to stay.

MM: I hear you, and I tend to agree, and we’re going to see what we can do.

HH: Office of Management and Budget Director Mulvaney, thank you, always a great conversation, go get those ships, and thanks and keep coming back to the Hugh Hewitt Show.

MM: See you, Hugh.

End of interview.


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