WHEN: Today, Wednesday, March 8, 2023
WHERE: CNBC’s “Last Call”
Following is the unofficial transcript of a CNBC interview with Congressman Ro Khanna on CNBC’s “Last Call” (M-F, 7PM-8PM ET) today, Wednesday, March 8th for the premiere of the program. Following is a link to video on CNBC.com:
All references must be sourced to CNBC’s “Last Call.”
BRIAN SULLIVAN: Joining us now for more on the budget spending and where we go from here in Congress and other topics Democratic Congressman Ro Khanna the great state the Golden State of California. Congressman Khanna thank you very much for kicking off “Last Call.” We appreciate it. I understand there’s going to be stuff in the budget about fair share and higher taxes. I get it. Many of those probably live in your district by the way. When did we talk seriously about if not cutting spending, being smarter about spending.
CONGRESSMAN RO KHANNA: Brian, Bill Clinton, as you know, left this country with budget surpluses then what happened? We had the war in Iraq and Afghanistan. We have massive tax cuts with the Bush tax cut with the Trump tax cut. We had the 2008 massive recession and we had Covid. But the Democrats are capable of good stewardship as President Clinton showed.
SULLIVAN: Well, the deficit is coming down but only off the Covid high. So the Covid of course, those two years stimulus trillions we understand that the deficit has come down from that level, but still the second highest nominal deficit in 25 years. How long can America Congressman realistically run a deficit? I mean, we’re still spending a trillion more than we are bringing in at some point taxes on the middle class will have to go up.
KHANNA: Another one, it depends. There are two types of deficit spending. There’s productive investment that actually is bringing manufacturing on shore, that is investing in the latest technology that’s leading to massive economic productivity. That is something that is good. Obviously, an investment that is not productive needs to be paid for but I think we can pay for it by having corporations pay tax by having some increased taxes on those who are wealthy, many in my district, as you pointed out, and the President is putting forward concrete policies towards that end.
SULLIVAN: But when we look at let’s say we increase the tax rate on companies we can argue about that all day long. But let’s say we did that. Let’s say we raise taxes on over $400,000 earners by 1.2%, as the President wants to do, you’re talking about maybe a day or two spending of the federal government. The money we’re pretending saying that is going to solve these big holes. When it’s probably maybe 10 or 20 or 30 billion when the government is spending $17 billion a day.
KHANNA: No, there are consequential things we can do. I mean, if you scrap the cap on the Social Security tax right now, as you know, it’s not taxed above 160,000 That would do a lot to make social security solvent and you could actually increase social security benefits. Now people may not agree with that idea, but that’s a concrete proposal Democrats have of how we have financial solvency and it save and protect Social Security.
SULLIVAN: Yes, which we all want to do. But Social Security is a mandated savings program. If you do what that proposal suggests, you’re just turning Social Security into another type of income tax, which can then just theoretically be raised forever. I mean, Social Security is not an income tax. It is a mandated savings program.
KHANNA: Sure, but people pay in that mandated savings program tax up to 160,000. I don’t understand why they can’t pay tax if they’re making 400,000 on the full income and that seems to be common sense –
SULLIVAN: Would they get all of that benefit back, Congressman? Would they get it all back then? When they retire, they’ll get 30,000 a month in benefits?
KHANNA: No, they wouldn’t. But there are actually Republicans who have said that they don’t want people who are wealthy to get all of the Social Security benefits. This is just another way to do it. But I guess here’s my point. The Republicans don’t have a plan. They say they don’t want to cut Social Security at the State of the Union, so what’s their plan for solvency? I just laid out very specifically a plan that would get the numbers to work. They have one of two criteria. Either they have Paul Ryan’s plan – cut Social Security, raise the retirement age, or they have to have some increase in tax. And where are they going to do it? I think they should just be transparent on the numbers.
SULLIVAN: Yeah, it seems – I agree with that. That the numbers don’t match up. By the way, no matter how you stack them. But Congressman, let’s switch it up. And move on to a big congressional hearing that happened today. FBI Director Christopher Wray warned lawmakers that TikTok “screams” national security concern. Take a listen to the stunning exchange between Wray and Marco Rubio.
Video clip from congressional hearing:
Sen. Marco Rubio: Could they use TikTok to control data on millions of users?
Christopher Wray: Yes.
Rubio: Could they use it to control the software on millions of devices given the opportunity to do so?
Wray: Yes.
SULLIVAN: Now TikTok, you’ve all heard of it. But did you know it’s got at least tens of millions – we don’t exactly know – tens of millions of monthly active users in the United States. Congressman Khanna, you probably have family members or kids that use TikTok they love it. Should it be banned?
KHANNA: We should not allow the Chinese Communist Party to have control over it. I share FBI Director Wray’s concerns it’s not just that they could take Americans data and misuse it. It’s that they could have propaganda, subtle propaganda with many of our kids so they could have propaganda about human rights violations in China. So I have said it should be there should be a forced sale to an American company.
SULLIVAN: Yeah. How would that work? Let’s say, there’s been a couple of things floated. There’s been the TikTok remains owned by ByteDance, which is a Chinese company of which of course we know the Communist Party is really a quote I’m doing air quotes Congressman, “partner” with almost every major Chinese company, that they just move the server here to the United States and don’t keep servers in China or could we use a CFIUS or one of these other national security programs to it to your point force the sale. What would be the mechanism for that?
KHANNA: It’s better that they have the servers here than not but I don’t think that’s enough. I would use CFIUS and national security to force the sale to a company that is at least 51% American owned that’s headquartered in the United States that will play by our rules. I just think it’s too big a risk especially look, I just led a delegation to Taiwan and one of the places visited at Taipei University said that China is engaged in huge propaganda around the world and to have them have a platform a company like ByteDance or TikTok that is just asking for them to spew propaganda into the United States.
SULLIVAN: Yeah. How long will this go on? When, we’ve been talking about by the way, it’s one of the biggest bipartisan things that we hear about one of the few although there are more than we hear about in the media, what would be a timeline on this Congressman, like when would this actually come to fruition or come to pass if it were to happen?
KHANNA: I think it should happen this year. I think it should be a priority for the China select committee that I’m on. Look, you can’t tell millions of American kids don’t use social media or TikTok but you can tell them have that used by an American company. We’re great at social media. I mean there are excesses that need to be regulated for kids, but it’s not like American companies aren’t capable of doing what TikTok is doing so have it owned by an American company.
SULLIVAN: Yeah. Can you imagine? I mean, can you imagine the teenagers of today Congressman, we wake up tomorrow and TikTok suddenly is gone. It’s not on their phone. The app doesn’t work. I mean, it’d be a national day of mourning. Congressman Ro Khanna appreciate you joining us. Thanks for kicking off the “Last Call.”
KHANNA: Thank you.
SULLIVAN: You’re very welcome.
