Bessent delivers urgent message to American workers: ‘Become an AI native’

Welcome back.

The Trump administration hoping to give working Americans a boost in the new year with a new tax refund of up to $2,000 by early next year. The payout coming from recent tax changes and tariff revenues with as much as $100 to $150 billion flowing back to taxpayers in the first quarter of 2026. The White House says it expects this to be the largest refund season on record. I am with the Treasury Secretary this morning, who is also the IRS Commissioner, who is also

the guy who's holding it all together. Secretary, what can you tell us? You see all the data. What can you tell us about the upcoming tax season and what we're going to see in terms of our returns?

Yeah, so Maria, let's go back. The one big beautiful bill was passed on July 4th, but for working Americans, it was retroactive to the beginning of the year. Most taxpayers did not change their withholding. So as a result, we're going to see very substantial, 100 to 150 billion of refunds in the first quarter go directly to Americans' pockets. So the sooner they file, the sooner they'll get them.

Our estimate is it could be a thousand, two thousand per household

depending on the number of workers. Wow that is a big deal. So Secretary you've talked about this additional money from from the tax code that we're getting. You talked about the impact of the big beautiful bill. It sounds like you think we're gonna get a real economic boost for the macro story in the first or second quarter. Is that what you're saying? Yes.

I think it's going to start lifting off in the first quarter and the second quarter. And you know, Maria, the other thing, when I started my career on Wall Street in the 80s, people used to focus on trade. Were we building more in the U.S. or were we importing more? We're seeing the trade deficit drop, too. So the trade deficit drop means more production in the U.S.

So I think that's something that economists are going to have to start looking at again, thanks to President Trump, after 40 years.

Well, you're proposing a major shift now in how the government approaches financial stability by reexamining crisis-era rules, moving toward a more flexible regulatory framework. This could not be more important. I know President Trump thinks that deregulation is arguably even more important than tax cuts.

Yes. Well, they go together, and the tax cuts allow corporations, but more importantly, working families to keep more of what they get from the deregulation, and the deregulation allows us to have substantial growth without inflation. What caused the inflation under Biden was they did this gigantic spending, the series of gigantic spending bills, but then they constrained supply through over regulation. So what we've done, I chair something called FSOC, the Financial Stability Oversight Council, and these 2008,

2009, 2010 financial rules were too tight. They have hamstrung the American financial system. It was time for a change. We're gonna be safe, smart, and sound in terms of our deregulation, but we have to take the financial system out of the straitjacket. This substantial increase in private credit, which is outside of the regulated banking

system, that tells me that the regulated system is too constrained and has not been able to compete with those who aren't regulated. So we're leveling the playing field, and I believe that we can do that in a way that creates trillions of dollars in credit for this very strong economy we're gonna see, and it will be non-inflationary.

Secretary, let me move on to China, because we are worried that they are not sending the rare earth magnets that we need in this country. You said to me a month ago that you thought we would have a signed document on a trade deal with China very soon. Where are we with this, and do you trust that, in fact, they are going to flow these rare

earths even to companies that are tied to the U.S. military?

So Maria, it's trust but verify. Thus far, the Chinese have done everything. We negotiated a deal in Kuala Lumpur with my counterpart, the vice premier. President Trump and President Xi had a very robust discussion in Busan, Korea. And Maria, the good news is, President Trump respects President Xi, but more importantly, President Xi has great respect for President Trump respects President Xi, but more importantly, President Xi has great respect for President Trump.

And that is new. That is not like the previous administration. Previous administration was all bark, no bite, which is very dangerous geopolitically, very dangerous economically, and the Chinese have lived up to every part of the negotiation

thus far. Well, the president's going to be meeting with Xi Jinping in April. What more do you want to see China agree to?

Well what we would like to see is them to begin rebalancing. The world cannot have a China that has a trillion dollar trade surplus. That's just not possible. So they need to increase their domestic consumption. Many of our allies, early in the summer when we put up the tariff wall, I told the Europeans, the Australians, the Canadians, the Brits, Koreans, and Japanese, I said, look, this

flow of high-end goods from China, the global South cannot take all of that. It's coming to your shores and now they are being overwhelmed by this never-ending supply of Chinese goods and I think it behooves the Chinese. We could do, as Ray Dalio would say, a big beautiful rebalancing together. President Trump wants to bring back more manufacturing. The Chinese need to consume more. If we could do that together it'd be a very good equilibrium.

Secretary, you're doing so much. In addition to all of this that you're doing in terms of growing the economy and ensuring that we've got stability here in America, you're also dealing with sanctions. Sanctions on Venezuela, sanctions on Russia. What's the most sort of crushing sanctions? And do you think sanctions actually work?

Sanctions applied fulsomely, robustly do work, but I think what's happened over the years is we've gotten very lazy on sanctions. So with my treasury department, we go in, we have a clear objective, we believe if we do these sanctions, this will happen. We look at it 90 days later, are we achieving our objective? Because the thing with sanctions, Maria, is you just create new markets.

You sanction Russian oil and then a ghost ship start appearing or disappearing. You're trying to cut off Iranian oil, same thing. So a good sanctions regime, you always have goals, and you constantly reevaluate whether you're meeting the goals. For instance, on Venezuela, we had—Venezuelan oil had been sanctioned for years, but now President Trump has taken the initiative.

We are cutting off the narco boats. And for the first time, we have now directly boarded ships carrying Venezuelan oil, and the oil is sanctioned, and that's the authority under which we take it. And I think the Maduro regime is on the ropes.

Secretary, with all of this that you're dealing with, is it fair to say that you're going to put the IPO of Fannie Mae on the table for a little while? I mean, is this off the table right now?

It's not off the table. We're working on it very deliberately. As I told you when I've been on here before, Maria, we have several goals. The first goal and the guiding principle is that the spread between mortgages and US government bonds in any IPO scenario has to remain the same or come down. Then we want to get the maximum amount of value and we want to create the best

shareholder base. So that's still moving forward. So it's going to be done next year sometime? Sometime. All right real quick before you go, this is my final question here. There is a story in the New York Times here's the title now it can be told Nancy Pelosi resisted stock trading ban as wealth grew fueling suspicion why is it that Congress is not following the rules that so many others follow and that is you can't day trade we spoke with Congressman Brian Stile here the other day, and what he said to me was

extraordinary. Do we have that sound bite real quick for the secretary from Congressman Stile?

Let's roll it.

There should be no instance where elected officials are making money off of insider information. If you want to trade stocks, there's a place for that. It's called Wall Street. We have an opportunity to prevent members from day trading, profiting off of insider information.

But we have to also make sure that we have individuals who have had successful business careers are still able to come to Capitol Hill. It's my view that we need more people with business experience in Washington who are willing to serve this country.

Congressman, do you believe that members of Congress are day trading?

I think there is clear evidence that people are day trading, and I think the appearance of that impropriety is a risk to the integrity of the institution. You can look at the returns and you see massive numbers of trades. We had a United States senator who was the head of the Intelligence Committee who sold their entire portfolio except one stock in the lead-up to COVID. And so I think we see this time and again, and it's a reduction of the integrity of

the institution, and it is why it is so absolutely essential that we put in place rules of the road that make it clear that elected leaders cannot profit off of insider information. And I'm of the belief that we can pass that legislation.

Oh my God. Members of Congress are day trading? Honestly, I did not know that.

Well, Maria, I don't know about day trading, but if anyone wants to go to the Treasury X account, my account, we posted a study on congressional trading, and it shows why they outperform. They outperform for two reasons, because they have access to corporate executives and they have inside information,

or two, they have inside information because they know the direction of legislation. And you look at these Pelosi returns, and I'm cuffing it, but since she came in in 1987, her husband's returns are something like the 16,000% versus 2,500% for the S&P. You look at Senator Ron Wyden, he makes Nancy Pelosi look like a piker.

I think he had 125, 130% returns. All those stocks were bought during COVID that, you know that we at Treasury, we in the administration have very strict rules in terms of what we can own. And it is unbelievable to me, when I had my private fund business, we were not allowed to own individual stocks.

You can make a lot of money betting on the United States through indices. We had trading rules.

You could do ETFs, you could do index funds.

Exactly. So, this is why, exactly as the congressman said, this is why the American people hold Congress in such low esteem. They believe that it's an insider's game. I believe that it would help the institution, it would refocus the, and look, people come to Congress and to the Senate, to the House and the Senate, to do

good for the American people, and it behooves them and their status as great Americans and great patriots to end this now.

Unbelievable. I mean, are you surprised at when you see all of this stuff? You've got insider trading potential. You've got attacks and smears against good people. You've got, you know, this threat to democracy on so many levels, and then they say

that President Trump is doing that, and yet they are winning the messaging argument on affordability. How is that possible?

Look, a lot of it is the mainstream media, and I've repeatedly said on affordability, what we and this administration are not going to do is what the Biden administration did and the mainstream media. They told the American people you don't know what you're feeling, you don't know how good you have it. They called it the vibe session and that was Greg Ip at the

Wall Street Journal, toxic Paul Krugman at the New York Times, former vice chairman of the Fed, Alan Blinder. You don't understand how good you have it. We know that the price level is high and President Trump is working every day, every day to bring it down and we are not going to tell the American people that they don't know what they're feeling. We are going to help solve this real income growth and holding prices down.

Yeah, Secretary, you're doing so much. We so appreciate your time. Let me end with this. You've got some fear on the part of college graduates right now. You've had an incredibly esteemed career, from Wall Street to Washington. If you were graduating right now, Secretary, if you're looking ahead to the new year and

the new five, ten years of this revolution of AI, what job would you go into? Would you choose a different sector?

Well, I don't know what job I would go into, Maria, but I can tell you I would be trained up in AI because the real thing that college kids can do that, if you remember during the internet boom and the aughts, it was kids were, college graduates, were digital natives. They were facile with devices, with machines, with the internet, like you and I never will be. So what I would do is become an AI native

and make the value proposition to any employer, this is how I can help you implement this program. I'm not afraid of AI. I had the CEO of one of the largest credit card companies and I said, tell me seriously, do you think AI is going to hurt your hiring?

He goes, no, we're just gonna hire in different areas. With customer service and maintenance, we'll have fewer employees, but in content creation and other areas, AI is going to help us. We'll hire more and we'll do the better product with highly trained people.

So my message would be become an AI native.

Great, great advice. And thank you for taking that on. Mr. Secretary, thanks for your leadership. Thanks for your time this morning. We've had a great substantive interview this morning and Merry Christmas to you. Good. Thanks to you, Maria. Thank you so thanks for your leadership. Thanks for your time this morning. We've had a great substantive interview this morning. And Merry Christmas to you.

Good.

Thanks to you, Maria. Thank you so much for joining us. Treasury Secretary Scott Besant here in studio. Stay with us. Stay with us. We'll be right back.