LIVE: Treasury Secretary Speaks at Heritage Foundation’s The Forum 2026

Tommy, you weren't clapping. Okay, good. Look, I think every speaker, every panel have just been fantastic. How about a round of applause for them? So if you're one of those speakers, don't be offended by the next comment. We saved the best for last. How about it? And the reason we did that is... Our next guest in this final conversation of what has been not just a very successful event, but I think one that will go down as a historic event as we make this pivot back to getting the good guys in power, is one of the great patriots of our age, and I happen to think one of the most substantive people in government office in a generation. We have a great video about a great Treasury Secretary. Please enjoy. Tonight, at a defining moment in the history of our republic. A nation that knows how to build, invent, produce, and lead is never destined for decline. In this moment, where would you pay money? The United States of America. We've become addicted to this government spending, and there's going to be a detox period. What we are here to do is to... Prosecute criminal fraud. My worry is that the Fed is turning into universal basic income for PhD economists. Let's not be lulled into thinking our work is over. In fact, it's only just begun. The American story is not self-sustaining. It requires each generation to decide anew whether its next chapter will be written by those who believe in this country or those who apologize for it. Ladies and gentlemen, please join me in welcoming Treasury Secretary Scott Bessent. Mr. Secretary, I'm not aware of other Treasury Secretaries who get that kind of warm welcome. Well, not since Alexander Hamilton. Oh, man. Yeah. Yeah. Beats still my historian heart. Yes. It is a real pleasure to have you here. It's always a busy day in your schedule, and particularly busy now. You've got a real important trip coming up next week we'll touch on. But I meant what I said earlier. I'm biased. You've been a great friend of Heritage and personally for a while. And you're doing a great job. But I think this crowd, which has heard all kinds of things about the event last week, is really focused on the future now. And we're counting on you to give us the last word of substance and optimism. Tell us, Mr. Secretary, about the American economy. Great to be with all of you, and I do have a very soft spot for Heritage. We have a great group down in Charleston, South Carolina, my hometown, where I will go back to when I finish my work here in Washington. Thank you very much, Dr. Washington. I couldn't be more optimistic on the American economy and I think Kevin, like me, is old enough to remember the op that got run in 1992 where James Carville said, well, it's the economy, stupid. And then when Bill Clinton won, the New York Times 10 days later miraculously pronounced, the economy is great. After George H.W. Bush lost, but I describe 2025 as setting the table, 2026 as the banquet or the feast, and when I think about the four legs of the Trump administration's economy, they're all doing well. Trade deals. The president has done record trade deals, and we are bringing back manufacturing to the U.S. We have a manufacturing renaissance, tax deals. The Working Families Tax Cuts, also known as the One Big Beautiful Bill, had so many things in it. But when you think in nature, symmetry is beauty, the tax bill was beautiful because of the symmetry. On one side, you had very pro-business initiatives, full 100% immediate expensing of equipment that is permanent, permanent. The immediate expensing of factories, immediate expensing of ag structures. On the other side, for working Americans, the president kept his four signature promises. No tax on tips, no tax on overtime, reduced taxes on social security. Eighty-five percent of our seniors now pay no tax on the social security. And the deduct Interest deductibility on autos that are made in the United States of America. So he did that. Other things in there, I think we're going to talk about the Trump accounts, Trump accounts, educational freedom. the The ability for taxpayers to contribute to funds that will then go to states and down to families and children to be able to allocate you either for school vouchers, public school kids for tutoring. very So there are just so many things in there. So trade policy, tax policy, energy policy. much. The United States currently produces more energy than Russia and Saudi Arabia together. So we are doing that. The other thing, too, is under President Trump's leadership, we are going to build the first new refinery in the United States of America. And the high gas prices were not an inevitability, except that we closed down 90 refineries. So, Brownsville, Texas, I think the refinery is going to be finished in 2030. And then fourth, the deregulatory agenda, which I know the Heritage has championed in your economic policy group, President Trump said for every new regulation that goes in, whether it's financial, environmental, labor, 12 had to come out. So it's a good ratio. Well, that was the mandate, but it's been, for every one, 120 have come out. Even better. So when I think about what we're doing at Treasury, I'm trying to bring back community and small banks. Because more than 50% of them have disappeared since the great financial crisis, and they power Main Street. And so I think with this economy, I coined the phrase parallel prosperity. Wall Street always does great, and Wall Street can keep doing great, but it's Main Street's turn. The Wall Street Journal called me an Ivy League populist, and I said, well, you're called the Wall Street Journal, not the Main Street Journal. That's a great response. Yes. Yes, sir. And it sounds like something Dr. Roberts would say, but both can do well. It's not either or. And, you know, on that last point, Mr. Secretary, about it not being either or, we need more people saying that. Actually, whenever that story was written, maybe it came up before. At Heritage, we were paying really close attention because what seems like an esoteric policy. Revitalizing community banks is so important for us, not just economically, but as you realize, because you are an Ivy League populist from South Carolina, it's part of the social and cultural fabric of individual communities, which are just the bedrock of the individual everyday American. And similarly, Trump accounts are too. And one of the things we've been trying to do over the last couple of days is not just talk about policy and where the conservative movement goes from here. But to attach human stories to that, I know a little bit about your childhood where your dad was very successful and then lost his fortune and then rebounded. And you, obviously, a self-made American, successful in business and obviously now successful as Treasury Secretary. I think you understand the importance of Trump accounts better than most people. So my family and I, one of our philanthropic focuses over the past two decades has been financial literacy. And when you think back to old days of high school education, everybody used to think, well, home economics just teaches you how to cook. Well, it was actually home economics. This is how you run your household. This is how you balance your budget. And for young people today, I just think all the choices are buy now, pay later, crypto, these credit cards. You know, all kinds of snazzy mortgages, some good, some bad, a lot of insurance products. But 38% of Americans have no stake in our equity market. They don't own equities directly, or they don't have a 401. So I think with Trump account, President Trump set out to create an ownership society. So Treasury has registered 70 million. Children with Trump accounts, and so anyone in here, children, grandchildren under the age of 18, trumpaccounts.gov, go and claim it. We've had about eight or nine million of them claimed. We're trying to get that up. So for children born during President Trump's second term, Treasury is putting in a $1,000 seed investment. So for four years, then we're also seeing we've got some great philanthropists, Susan and Michael Dell put in $6.25 billion with a B. And they do deserve a round of applause. What a tremendous thing. And, you know, look, whether you're a Dell user or an Apple user, Michael Dell started that company in his dorm room at the University of Texas. And he is giving back. All And that... So thanks to Susan and Michael, there are 25 million accounts with $250 on them waiting to be claimed. right. Elon Musk is going to give one share of SpaceX to all 70 million accounts in January. So that's going to be waiting to be claimed. Parents and families can add $5,000. Employers can add $2,500. We've got more than 120 companies that are making this a fringe benefit for work. And it's the other thing, too. A lot of families didn't have a means to save. So you can... You can throw in $1,000, you can throw in $10 for a birthday, for a holiday. My favorite great aunt used to give me socks, now she could give me stocks. Thanks very much. . So, yeah, I see a lot of people had that great aunt. . . . . . I think you just started a meme, Mr. Secretary. . Yes. So, stocks and socks. But it's going into low-cost index funds, and I think it's going to be, back to financial literacy, I think it's going to be the ultimate real-time financial literacy learning because families will be able to look and see how they account debt every day. At Treasury, we got 15 learning modules for the children based on age, but we've also got it, many of these parents have no exposure to the equity market. Little River, South Carolina, you were rich if you had a fishing boat or farmland. That's right. Well, thanks for that explanation. I certainly at Heritage, we are very high on not just the possibility of increasing The percentage of Americans who have an investment in the equity market, but also understand finances in the economy a lot better. I know that's why you're so passionate. Something that's related in my mind, at least, because it is a new technology. That you and my colleagues at Heritage tell me will really make us more productive and efficient. You know me well enough to know that I am not the biggest techno-optimist in the world. Which means that when I hear the words AI or super intelligence, my first thought is it might change too much. But you also know that at Heritage, and especially at this event in the forum, we're letting everyone say their piece. So here's your chance, my colleagues put me up to this question, for you to convince me. That artificial intelligence will be a net positive. Well, here, I will pull you from Amish to early adopter. Okay, that's good. You got six, no, just kidding. We only got 18 minutes, so, but. It won't, I don't think it will take that long. Look, the, all technological change is, can be. It can cause uncertainty, it can cause trepidation. I am not an economist, I'm an economic historian, and over the years, the industrial revolution, electricity, the internet, we've seen a lot of anxiety around that. I think at one point, 1910, 1920, there were 10,000 elevator operators in the U.S. The elevator operator went away and they all got jobs that 25% of the jobs in America right now did not exist in the year 2000. So I think with the president likes to call it SI, what we were going to see a revolution. But what I also want to say is the SI, they're called the large language labs, they're creating And the companies and the folks building the data centers have done a horrendous job, a terrible job, explaining the value proposition to the American people they have. Whether it is data centers in the communities, I think they had overreached. They became these mysterious things at the end of the lane. That size of a football field, and what is it, why is it, why is it good for me? On the other side, I think just like financial literacy, AI literacy, and this idea, what I really want to say is that the U.S. is so far in the lead on this, that 2024, the United States had 58% of all of the computer capacity. Compute capacity in the world, in 2028, we're going to have 80. And we're just pulling away from the rest of the world. And what we were seeing so far, I drive people in my office crazy because they'll say, well, they'll try to get me to opine on things. What do you think of this? What do you think of that? And I'll say, well, no data, no opinion. And now everybody had opinions on superintelligence, and now we've got some data. So, so far, companies that use it are hiring more people. We have not seen the people who know how to use SI. Are getting bigger pay raises whenever I talk to young people, late high school, college, just coming out of college, they said, well, is artificial intelligence going to take my job? And I said, no, someone who knows how to use it is. Get after it. You're telling me to get with it. What? Yeah. Yeah. Well, again, but I'm sure you will have a cadre of people who know how to do it. And I think we're going to see some real upside surprises. Six, nine months ago, I was asking one of the leading venture capitalists in Silicon Valley, before we'd seen any of the data, give me the optimistic, tell me something about SI that is positive that nobody's talking about. It's going to be a boom for small business. And really, it seems like that's a stretch. You've been exactly right. I also had the honor of being the acting IRS commissioner. A dream of a lifetime, but we're actually making great progress there, and it's an honor to be able to run the agency, because I get the collection and the spending, but at the IRS, we can see a record number of people filing for small business tax ID numbers, So we are seeing record small business creation. For those of you who know the payment company Stripe, I had one of the founders in the other day, and they said that they are seeing a record request for payment applications because of all the new small businesses. So I think Wall Street Journal had a good article two months ago, and it was about the advent of the one, two, three person startup. So something that might have taken 12 or 15 people, now you can do it with one or three. So I really think that the United States is a startup nation, and I think people are going to be able to, if they got an idea, put it in effect. Well, what I will tell you, sir, is I'll step out of my Amish buggy and I'll try. And my great friend, Eric Korzval, longtime employee at Heritage, our chief operating officer, has been the biggest advocate for Kevin to use AI more. I'm not quite going there yet, Eric, but you made a very impassioned plea. Thank you. Very convincing. All joshing aside, one aspect of the advent of AI that I fully apprehend is the importance of staying ahead of China. You and President Trump have been, along with the entire administration, really strong on China. You have a very important trip there next week. Give us whatever insight you can a few days before. Okay, so I'll discuss the excellent point that you make, Kevin, on staying ahead. So I lead our relationship and negotiations with China, and I will tell you, they are looking for every advantage that they can. And we. We are six, 12 months ahead in AI, which in AI, SI, is an eternity. It's the difference between what the models could do six months ago and now is unbelievable. But what's happening is that the Chinese, like with everything, are copying what we do. There is a scientific word for it, distillation, but industrial-scale distillation or theft. But their models are very cheap, another thing the Chinese are very good at, and their models are dangerous because they don't have guardrails on them. So I predict you're probably going to see a big incident somewhere in the world. I don't know who here saw the refrigerators in 150 grocery stores in France that got turned off. That was a Chinese model. Probably the worst of all worlds, the Iranians using a Chinese model. Sums up the world, doesn't it? But the other thing that... sums up the world is the U.S., strong U.S. models are our best protection, that they will be able to put a shield around our businesses, around our personal finances, around everything, so we cannot slow down here. But again, I think the industry really has to make their case to the American people, which they have not done. So another adversary in the world, in addition to China, Iran, you're playing a vital part of this. In fact, our colleagues at Heritage think perhaps the most vital part in terms of economic strangulation. How's that going? What can we expect over the next months in that region of the world on the economic side? So with Iran, the president back when I came into the position told me March 2025, Scott, go get them. And we started with a maximum pressure campaign. I gave a speech at the Economic Club of New York. And I'd been in the finance business. And I said, I know a couple of things about trading currencies. I think the Iranian currency is going to collapse. And for everyone in Tehran listening to this, it should get out. So it was that. $600,000 to the dollar then, now it's at $3 million, so they have 200% inflation, and the economy is so bad now that it's against the law to print the price. I wish I could do that with some things. Thanks. Thanks. But, so this summer, Thanks. The president said, really, everything we got. So we started what's called Operation Economic Outcast. And Operation Economic Outcast is the single greatest effort in the history of the world to economically isolate a state. And it is possible because we had six weeks of intense bombing, destroyed their navy, their air force, a substantial part of their missile capability, and importantly, destroyed about 85 or 90% of their ability to reconstitute that. Now we have what President Trump calls the wall of steel, the iron blockade. So for the first time since Iran began producing oil, they have no oil on the water. No oil in the water. Our blockade, our Navy has been incredible. And then at Treasury... Yeah, a round of applause. No, I, that, and it's amazing to watch, too, that the Admiral Cooper will bring in some of the videos. He's the head of CENTCOM, will bring in some of the videos, and a ship that's trying to sneak through there, do not proceed, and then they keep going, and they have some kind of megaphone that works across the water, Get out of the engine room! And then they blast the engine room and mobilize the ship. So nothing has gotten through. So they have no oil in the water, which I think is a big psychological thing for the regime. Nothing's coming in. Unbelievably, Iran, which has the third most energy resources in the world, they're so decrepit, they depended on imported gasoline. So now they've got three, four-hour gas lines. They're not able to pay the police. So we're really squeezing them, and I think it's going to bring them to the table and want to make a deal. Our partners in the Gulf have done a much better job of policing. We had to lead by example. So Treasury, we cut... We cut the largest Egyptian bank in Dubai off from the dollar system that put them under. They'd been giving the Iranians $1.8 billion in the past year. 30th largest bank in Turkey, the branches of the largest Russian bank outside of Russia, the international branches, we shut those down. And so we've showed people we came to play. And at your peril, we know who you are, you know who you are. Cut it out. This is the absolute end of the road for the Iranians. I got new authorities. We have shut down the airlines in and out. So I tell the IRGC, which is one of the reasons they want to kill me, that if you like your country, congratulations, you can't leave. You can't go to London to see your relatives anymore. You can't go to Paris to see your girlfriends. And you can't go to Geneva to visit your money. So, you've been more successful than I realized. One stateside problem that you've taken the lead on, and we're also grateful for your leadership on, is the national debt. And I know that's one of the things that inspired you to want to be able to get into government service. What is the question generally, sir, about the national debt and the deficit, but maybe within the context of what will be new majorities in the House and Senate, and you and your team's approach to working with them on maybe getting some fiscal restraint? So one of the reasons I came out from behind my desk in Charleston, I had the most beautiful walk to work eight minutes every day. One of the reasons I wanted to come out from behind my desk, I went to see President Trump end of 2022, and I said, you're going to win. I want to be in the economic team, and I want to help bring down these debt and deficits. And $40 trillion is a startling amount. But what is important is our ability to generate economic growth, too. So what we did in the one big beautiful bill that didn't get much credit, we had the first big spending cuts, 1.5 trillion over the 10-year window, the biggest spending cuts ever. So if we can... Cut spending, constrain spending, and grow real GDP faster than 3%. We were 3.4 last quarter. Atlanta Fed GDP now is almost at 4 now. And this is with the Iran conflict. But if we can grow above 3, constrain spending, we will start bending the curve. Now, what's going to be the approach with the Democrats? I think I'm going to try to take something out of the Bill Clinton-Newt Gingrich playbook. It'll be reversed. That's the model. We have the executive. They have the legislature. And we'll see if they're serious in terms of what they want to do, in terms of bending the curve down. We think there is a lot of... I think there are a lot of tax gimmicks that serve no economic purpose. It's not a tax increase. They They're just a lot of crazy things in the tax code that I think can be revenue raisers without raising rates. And then I think if we can let the economy cook and the four-legged stool that we've got on it, then we can be in good shape. you. But we'll see if they want to play ball. I'm just going to say that I'm glad you're in the seat you're in with that majority coming in, not just because of the business experience that you have and what's already been a very successful two-year run as Treasury Secretary, but you also understand the politics of the moment in the general sense, and I think your referencing of the 1990s is helpful in that regard. For what it's worth, that's certainly where our collective minds at Heritage are. But I have to say, as we move toward wrapping up here, Mr. Secretary, It strikes me, think about the topics we've covered. National debt, Iran, China, superintelligence, Trump accounts, tax credit scholarships. It doesn't sound like this president is slowing down. No, exactly. I always think, how am I having trouble keeping up with an 80-year-old? Right? And I will say that the fakest of news is that Donald J. Trump is slowing down. If anything, he's speeding up. Good. Good, and whenever anyone asks me. What's the best part of your job? I said, well, many of you may think it's the president calling me in the middle of the night and I was telling Kevin backstage, it always starts the same way. Scott, I didn't wake you up, did I? No, sir. I'm always up at 1:52 on a Tuesday. That's a big mistake. And I mean, he just never stops. And it's an honor to work with him. We've got a great team. And he's going to keep going. And anyone who thinks that he is a lame duck, yeah. Good luck to that. Good luck to all. I see it on the international stage. When he deals with these international leaders, it's a different thing. His stature, his intellect, how quick he is, the way he pushes the agenda. I see all these people, the Democrats or even some Republicans, who come in the Oval and they're going to give him An earful, and they just melt when he starts on them. I need two more years of that. Yeah. So, last question for you. You basically get the last statement of this whole conference, where I wouldn't say that people, when they showed up, were down in the dumps. I mean, these are great American patriots, right? But we've tried to do our best job at Heritage of bringing in some other friends of the movement, other business leaders, officials, and putting some substance behind the optimism. Why should these folks, when they leave here later tonight or tomorrow, they go back home, be optimistic, but also, because you're really good at the practical, what should they be doing to help advance the cause? Well, the first thing is to... Stay in touch and let us know how you're feeling because one of the things that I never did, the economic data was fantastically strong, but I always said, I will never tell the American people how they feel because after the Biden, after COVID, after the Biden. You know, I'm looking at the data that they, in terms of what happened in the vote, there's a lot to see. Many of the races were less than a percent, where we lost less than a percent. Two percent. And we'll see the ability for the Democrats to act normal. I guess anything's possible. Anything's possible, but I don't think... We'll see, because there are a lot of these Democrats who won in what are red seats. Maybe there was a protest vote. Maybe we didn't have a great candidate. But I think the Democrats are renting the seats. And, yeah, I think it... We do the right thing. We're going to get on the other side of the Iran conflict. Prices are going to come back down. I think the trajectory is good. Thank you, David. And I think that what the president projects in terms of the U.S. being back, in terms of the border being closed, we'll see what happens down at the border with this new Texas governor. Does she want to open the border? Do they, what do they come out of the blocks trying to do? Because I do think that a lot of these, again, the Democrats who won in red states and red seats are just going to be, it's kind of like a ski rope where the skiers come off. They're just going to be caught in the wake and not know what to do. And I can tell you that the... The thing that makes me the most optimistic is when I travel around the world, the U.S. just keeps pulling away. So sometimes when you're at home, it doesn't feel like that because of the news cycle. I lived in London for seven years, and everyone said, was it great? And I said, the best thing about it is when you're on the outside looking in, it made me appreciate the United States of America even more. Because that... So I am so optimistic when I travel around the world. The Chinese economy, terrible. Europeans committing slow-motion economic suicide. The emerging markets, I think a lot of the global south isn't doing well. And I'll leave you with this, that I think one of the president's greatest accomplishments is going to be taking back the Western Hemisphere. Absolutely. We have more pro-U.S. countries in the Western Hemisphere than we've ever had before That began with... The seat in Argentina and President Lay, and it's just building on that because, and we're going to be, whether it's Treasury, state, energy, are all going to be highly engaged over the next two years to lock in that opportunity in this hemisphere. And it's a great economic opportunity. It's a great military. To prevent the military, it will prevent the immigration, and just the safety aspect of that from Greenland to Tierra del Fuego, the President's done it. It's a remarkable achievement. Yeah, it's incredible. Treasury Secretary Scott Bessent, thank you for everything you do for America, and thanks for joining us tonight. Great to be with you. Thank you very much. Thank you. Well, I suggested to you that would be good. It was. We have a few closing thoughts, so I will make one or two of them, and then Andy Alavastro and Genevieve Wood will come up and close this out. Two things. First of all, thank you. Thanks for being here. Thanks for your optimism. Thanks for your questions. Thanks for your participation.