Treasury Secretary Scott Becent testified today before the House Committee on Ways and Means on Drastic Tariffs imposed by President Trump.
Bescent left London after trade talks with China and returned to Washington early in the morning.
Speaking to the press before leaving the historic Lancaster home near Buckingham Palace, where the meeting took place, Bescent said of the Chinese speech, “We had productive consultations for two days, but the process is still underway.”
While the main agenda for today’s session was a priority for the Ministry of Finance, Bescent’s information on trade talks with China has generated considerable interest among the committee members.
The main agenda for the talks was for China to increase exports of rare earth elements to the United States in exchange for lifting US export restrictions on chip design software, jet engine parts, chemicals and nuclear materials.
Some of the highlights of Bessent’s prepared speech were:
- “If China is sticking to the agreement, rebalancing is possible.”
- “Trump has helped us to improve inflation significantly.”
- “Trump’s policy was effective in reducing price increases.”
In his opening remarks, Bescent said federal tax revenues rose 9.5% in April and 14.7% in May compared to the previous year, with those data claiming that the Trump administration’s tax cuts undermining criticism that revenues would be reduced.
“The Treasury completed its most successful tax season in a few years, reducing the efficiency and costs of the IRS,” he said.
Bessent also highlighted the regulations of new tax laws that encourage manufacturing in the United States. “We offer 100% depreciation for new and expanded factories. This law will start the era of manufacturing again in America,” he said.
“The law provides predictability for individuals and businesses and boosts economic momentum. It aims to strengthen the working and middle classes and stimulate American manufacturing,” he said.
“I returned in the middle of the night, but these consultations will not only stabilize economic relations, but will also provide a more balanced view,” Bescent said in an assessment of the consultations in London. China should move from overproduction to a consumer-oriented model, with Bescent saying “If China sticks to the principles of agreement set out in Geneva last month, a great and beautiful rebalance could occur between the two major economies of the world.”
Bessent also said inflation was under control and growth was “inflation-free.” He said, “We will repeat this success.”
China has “the most disproportionate economy in history” and has seen a severe contraction in the real estate sector, but Bescent said the US has received “unthinkable good” offers from other trading partners, and those offers include reducing non-voluntary barriers.
When California representative Linda Sanchez asked for details on the agreement with China, Bescent said it was back at 4am, saying the agreement was still “in development.” He also said the Chinese delegation questioned the validity of the original agreement during the Biden administration.
Bescent also warned that if tax laws are not passed, there could be a “financial crisis that has not been seen since 2008.”
*This is not investment advice.
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