New Senate Majority Leader John Thune on Sunday said one of his top objectives will be to address the country’s “fiscal mess” — even while acknowledging upcoming expected GOP tax cuts may not be fully funded.
Thune (R-SD), 63, who officially took the baton from Mitch McConnell as the Senate’s boss Friday, stressed his intent to focus on problems for the long term.
“I would like to see us as a nation do things that affect the long-term stability, future of our kids and our grandkids,” the Republican told NBC’s “Meet the Press” when asked about the “mark” he wants to leave during his tenure. “We’re in a fiscal mess, $3[6] trillion in debt.
“But I think first and foremost it’s protecting the country,” Thune added of issues facing the US. “Military readiness will be a big priority for me.”
President-elect Donald Trump and Republicans are headed for something of a fiscal storm in 2025, forced to reckon with expiring provisions of the 2017 tax cuts, expiring expanded subsidies in the Affordable Care Act and the return of the debt ceiling, among other issues.
Republicans have made clear that they want to extend the 2017 tax cuts and add other reforms that Trump, 78, championed on the campaign trail such as no tax on tips and no tax on Social Security checks.
Extending those tax reductions could add $3.59 trillion to the deficit between 2025 to 2034, according to an estimate from the Tax Foundation.
Thune admitted that Republicans may not be able pay for all of their tax reforms, even with such measures as cuts in spending.
“Well, not perhaps all of it,” Thune said when asked about paying for the potential bill. “What I’m telling you is a combination of growth, a combination of offsets, and an expectation, I think, that if you want to avoid a $4 trillion tax increase, you’re going to have to take some steps to extend the current tax policy.”
Republicans have long claimed that projections about the revenue generated from economic growth spurred by tax cuts tend to get underestimated in scoring.
“I believe there will also be a robust conversation about whether we can find offsets and achieve reductions in spending that would help offset some of that,” Thune explained.
“Many of the tax provisions that are in law today that will be extended will have a very positive impact on growth in the economy,” the Senate GOP leader stressed. “With growth, you get better-paying jobs, but you also generate more tax revenue.”
Republicans in the upper chamber intend to use a process known as “reconciliation,” which requires a simple majority to pass legislation related to the budget, to get through their tax agenda. They’ll likely have to rely on that because there is a 60-vote threshold to overcome a Senate filibuster, which is all but guaranteed by Democrats, when it comes to the GOP plan.
The Senate Republican leader has favored putting forth two major “reconciliation” bills in the Senate to try to help carry out President-elect Donald Trump’s agenda.
First would be a bill to address the border, energy and national defense. The goal would be to bring that to Trump’s desk so that he could have an early win. Then later in the year, a second bill would push tax reform, which is generally seen as more complicated legislation.
In the House, Republicans, including Speaker Mike Johnson (R-La.) and his top tax writer, Ways and Means Committee Chairman Jason Smith (R-Mo.), have favored a singular bill to carry out all those reforms. Trump has reportedly warmed up to that strategy.
During the 2024 GOP presidential primary involving Trump, Thune publicly endorsed colleague Sen. Tim Scott (R-SC) for president. Despite that, Thune insisted he and Trump will be able to work together, saying their relationship is “evolving.”
“It’s evolving, and we have a relationship I think where we understand what each other wants to accomplish,” Thune said. “There is an alignment of incentives. We want to get to the same destination.”
Thune praised Johnson for his work to navigate the tumultuous House Republican conference.
“He’s got a really, really tough job,” Thune said of Johnson. “I think he has been responsive to his members. … But he’s got a lot of folks that are headed in different directions.”
