AILSA CHANG, HOST:
President-elect Donald Trump has chosen a key member of his new economics team. He plans to nominate hedge fund manager Scott Bessent to serve as the next Treasury secretary. He will have the task of moving big parts of the incoming president's agenda, including tax cuts and tariffs. And for more on this pick and what's ahead, we're joined now by NPR's Scott Horsley. Hey, Scott.
SCOTT HORSLEY, BYLINE: Hi. Good to be with you.
CHANG: Good to have you. OK, so Scott Bessent - tell us more about him. Who is he?
HORSLEY: He's one of the President-elect's biggest cheerleaders in the financial world. He runs a hedge fund, the Key Square Group. He also worked for billionaire Democratic donor George Soros, which generated suspicion of him in some Trump quarters. But he's a longtime friend of Vice President-elect JD Vance. In a social media post this evening, Trump described Bessent as widely respected as one of the world's foremost international investors and geopolitical and economic strategists. So Bessent is 62 years old. He has the distinguished silver hair that a casting director might look for in a Treasury secretary. He and his husband have two kids, and they spend most of their time in South Carolina.
CHANG: And de doesn't have a lot of experience in Washington, right? Like, how is he going to navigate the Capitol, you think?
HORSLEY: Yeah. Well, one of his first jobs at the Capitol will be pushing for an extension of the 2017 tax cuts, parts of which are set to expire next year. That probably won't be a particularly heavy lift in the new Republican-controlled Congress. Trump has also talked about some additional tax breaks for tipped income and Social Security benefits. All of that would likely add to the federal debt, which we learned today has now surpassed $36 trillion. You might remember Trump's first Treasury secretary, in his first term, said the tax cuts would pay for themselves. They didn't do that. Bessent has also championed Trump's call for deregulation and for increased domestic energy production as a way to bring down costs.
CHANG: And Trump has also said that he wants to slap tariffs on all U.S. imports. So what has Bessent had to say about that?
HORSLEY: Yeah. He has defended tariffs, even though most economists say that would raise costs for businesses and consumers here in this country. On the one hand, Bessent has championed tariffs. On the other, he suggested in a Financial Times interview that he thinks Trump is merely pushing tariffs as a negotiating tactic, saying, quote, "my general view is that, at the end of the day, he's a free trader." So we'll see about that. Trump has had other economic advisers over the years - Larry Kudlow and Gary Cohn come to mind - who were skeptical of his protectionist instincts and thought they could turn him around. They generally found otherwise.
CHANG: Now, Scott, the Treasury secretary typically works closely with the Federal Reserve. So what should we be looking for there, you think?
HORSLEY: Yeah. Trump has been quite critical of the current Fed chairman. He thought Jerome Powell and his colleagues were too quick to raise interest rates when he was in the White House the last time and too quick to lower interest rates this fall, in the run-up to the election. Bessent caused some controversy when he floated the idea that Trump might appoint a shadow chairman to channel the president's views on monetary policy and sort of undermine Powell, although he later walked that idea back a bit.
There could be some friction here, though, and it's something to watch for. You know, Powell's term as chairman runs through 2026, and he says he's not going anywhere. The Fed is designed to be sheltered from political pressure from the White House. Powell has vowed to defend that independence, but he's also trying hard not to pick a fight with the incoming president.
CHANG: OK. And real quickly, two other personnel announcements from the president-elect this evening - give us just a quick summary.
HORSLEY: Yeah, Trump has tapped Russ Vought to head the White House Budget Office - a role he held in the first Trump administration - and he plans to nominate Lori Chavez-DeRemer to be labor secretary. She served one term as a GOP congresswoman from Oregon but lost her bid for reelection earlier this month.
CHANG: That is NPR's Scott Horsley. Thank you so much, Scott.
HORSLEY: You're welcome. Transcript provided by NPR, Copyright NPR.
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