Acting White House chief of staff Mick Mulvaney said he sees no way forward to cutting federal spending and the only hope for reducing deficits is to increase revenues through economic growth.
“There is no center of gravity to reduce spending in this town, period, end of story,” said Mulvaney, speaking Tuesday at the annual fiscal summit hosted by the Peter G. Peterson Foundation, a nonprofit organization focused on reducing federal debt.
“We are not going to cut our way to balance,” Mulvaney said.
Mulvaney, a fiscal hawk during his time in Congress before joining the Trump administration, said his only hope was to cut the rate of growth for spending and increase economic growth enough to raise federal revenues without raising taxes.
“We’re trying to figure out a way to grow our revenues to be bigger than expenses,” said Mulvaney.
The Congressional Budget Office estimates that deficits will rise in coming years, barring major policy changes, driving up the federal debt.
Mulvaney also argued for the administration’s renegotiated free trade agreement with Mexico and Canada, and said he believes Democrats only have reservations over approving the agreement because it would grant Trump a political win.
“There were many members of my incoming class that never would’ve voted for something that made Barack Obama look good, so I’ve seen this from the other side,” said Mulvaney, who held a seat in the House of Representatives from 2011 until joining the administration in 2017.
Mulvaney also said Trump has a secret deal with Mexico related to tariffs and immigration but declined to elaborate on what that might be, though he said Mexico would “help us with our asylum laws” if their efforts to reduce illegal immigration into the U.S. do not work.
Mulvaney concluded that he believes the administration will find a deal with congressional leaders to continue funding the government past the end of the fiscal year in September and said he expected both the Export-Import Bank and the Foreign Intelligence Surveillance Act to be reauthorized as well.
