Treasury Secretary, US Treasury
Bessent: Iran's currency in FREE-FALL under economic pressure
Treasury Secretary Scott Bessent joins 'Mornings with Maria' to discuss the Trump administration's crackdown on government fraud, mounting economic pressure on Iran, the AI race with China and the outlook for the US economy.
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About Scott Bessent
Treasury Secretary Scott Bessent has been a prominent voice on economic policy, national security, and financial initiatives in recent months. He has discussed the administration's economic agenda, stating that the economy was "growing at 4%" before the Iran conflict and expressing confidence that inflation would return to target. Bessent has touted job growth, saying the U.S. created 900,000 private sector jobs since President Trump took office, and has described the past three months of job numbers as a "blowout." He has also promoted the "Trump accounts" program, which provides a $1,000 seed investment from the Treasury for every child born during President Trump's term, and announced that philanthropists can donate stock into these accounts. Alongside First Lady Melania Trump, Bessent launched "Fostering the Future" accounts, a dedicated savings and investment vehicle for foster youth, which he described as "the most important benefit for young people since the GI Bill." Bessent has also focused on counterterrorism and financial oversight. He delivered remarks on "far-left political terrorism," stating that the Treasury is expanding efforts to identify organizations that abuse charitable and nonprofit structures as vehicles for illicit finance. He argued that "nonprofit status is a privilege" and that the Treasury will hold directors and trustees accountable for their grantees. On foreign policy, Bessent discussed the administration's approach to Iran, saying the U.S. military destroyed a large part of Iran's missile stockpile and that for the first time since 1979, Iranians are willing to discuss their nuclear program. He stated that the Treasury will oversee frozen Iranian funds released from Qatar, with a large portion going to buy U.S. foodstuffs and medicines.
Transcript (30 segments)
M
Maria Bartiromo0:08
Welcome back, good Tuesday morning. Thank you so much for joining us this morning. I am Maria Bartiromo. It is Tuesday, July 21, just before 8:00 on the East Coast. The Treasury Department announcing implementation of a new government-wide payment verification process to help stop federal payments being sent to deceased individuals. Nearly 5,000 payments worth approximately $99 million to dead people. Joining me now, the Treasury Secretary himself, U.S. Treasury Secretary Scott Bessent. Secretary, thanks so much for spending the time. Can you walk us through the Treasury implementing new safeguarding to stop payments to deceased people?
S
Scott Bessent0:58
Good morning, good to be with you. Look, this is part of what President Trump calls his common sense agenda. It is common sense. President Trump issued an executive order for us to be able to go to the Do Not Pay database, to have interact with Treasury payment systems. As a result, so far we've saved $100 million – payments that did not go to deceased people that would have gone out. We think up to $350 million that we can stop before the end of this year. That goes along with the Vice President's task force on eliminating waste, fraud and abuse in government. GAO estimates might be up to $500 billion dollars, about 1.66% of GDP. That could go a long way paying down debt, providing more services, and this is just the start, Maria.
M
Maria Bartiromo2:02
That is incredible. I mean for all of the fighting that we see back and forth between the Republicans and the Democrats about governing, allocating capital spending money on projects, to think all these millions of dollars, tens of millions of dollars that have actually been, you know, on the cutting room floor because of fraud and waste, that people just weren't paying attention to. That is all it is. People did not look and investigate the way President Trump directed his agencies to...
S
Scott Bessent2:36
Look, in the Biden administration, HHS got rid of 50 or 60 people charged with monitoring fraud. What is important here is that we are stopping more from going out. So once money gets out, trying to retrieve it is very, very difficult. Stopping at the source is our goal. There are hundreds of billions of dollars here. This is the start. We are off to a great start. You are seeing the Vice President's task force, things all across the healthcare system, too.
M
Maria Bartiromo3:12
For sure, we've got a spotlight on it, covering it because this is incredibly important, particularly as many in Congress complain about debt and deficits. Efforts to save, eliminate fraud, waste and abuse. Your take on the economic pressure you've been putting on Iran at Treasury. You said Treasury is fighting an economic war against Iran, sanctions against Iran. I want to get your take on that. You put major sanctions on Iran's shipping empire this month, sanctioning a network tied to Hussein, targeting more than 200 vessels in addition to the naval blockade. Tough stance, retaliation against Iran. Can you tell us what is left in terms of your purview? Sanctions, the economic warfare can still happen against Iran.
S
Scott Bessent4:12
Very successful. Six weeks combined, eliminated Iranian Navy, the Air Force, a large part of their missile and drone stockpile, destroyed most if not all of their capability to replenish. We moved on to what we call economic one-two punch. Blocked. What we're doing at Treasury, tracking accounts all over the world. Froze a crypto wallet linked to IRGC the other day, about $130 million. We have found the moneyman for the Ayatollah, tracking the Ayatollah's properties around the world. We hope to be able to print his hundred-million-dollar-plus properties, show the addresses. We are preserving this for the American people. But most of all, we are constricting the regime. Their currency has collapsed to an all-time low versus the dollar; it is in free fall. And we think the inflation rate is upwards of 180% in Iran. So you know, the government is causing the people to suffer, and we are going to keep pressing, but also going to marshal resources, save the resources that we recover for the Iranian people when we get on the other side of this.
M
Maria Bartiromo5:37
So how much of Iran's ability to finance the IRGC would you say has been disrupted? And are you prepared to put sanctions on, for example, Chinese banks, if you find out that Chinese banks, Chinese companies are continuing to purchase Iranian oil and trying to support the IRGC?
S
Scott Bessent5:57
Well, we have sanctioned Chinese, what are called so-called teapot refineries, the private refineries. We've seen a substantial decrease in their purchases of Iranian oil. The Chinese in general, because of the prices, because they have a very large strategic petroleum reserve, have dropped their purchases of crude about 40%, directly pressuring the Iranian regime. And we put the blockade back. I tell you, the blockade is powerful financially, I think also very powerful psychologically. It cuts Iran from the rest of the world. We also have the ability to interdict Iranian dark fleet once out of the Pacific.
M
Maria Bartiromo6:49
Incredible. We are watching all of that, Secretary. I want to move to AI, because of course we are producing programming special this week, talking to the most important companies and individuals in this AI race. And this amazing buildout. The Lindsey Group reported the Federal Reserve found the CapEx of Amazon, Google, Meta, Microsoft, Oracle reached $412 billion in 2025, or 1.3% of GDP. Some estimates for '26 north of $700 billion. One estimate $1.25 trillion in terms of spending on this buildout. Can you assess for us what impact of the AI buildout infrastructure that is happening massively, what is the impact on the economy?
S
Scott Bessent7:41
Maria, this is a generational technological boost. President Trump came in and became one of the great supporters of this very important technology. And it starts with we have to have the energy for AI. President Trump is allowing the AI companies, the data centers, to build their own power generation. So we are seeing it there, we are seeing it up the supply chain. And this is kind of a once-in-a-generation buildout. It is very powerful. On the other side of this, we are going to see big productivity growth. And really, that is how you increase national wealth, is through productivity growth. Look, the U.S. is the home for this. And one of the things I wanted to say today is we have seen talk about open source models coming, threatening the large language models in the U.S. What I will tell you is this administration supports open source models, but what we do not support is IP theft. If we see, especially overseas models are stealing from our great companies, we have the ability to sanction them because of this theft.
M
Maria Bartiromo9:07
That is a really important point. That is exactly where I was going next. The Wall Street Journal this morning writes top American AI executives are sounding the alarm on Chinese models. Silicon Valley in Washington is debating. The multibillion-dollar question: Should American companies be able to use Chinese artificial intelligence models, and what does that mean for IP theft, knowing we have been watching Chinese steal intellectual property from America and the West for decades?
S
Scott Bessent9:37
We are finding watermarks of our U.S. large language models on many of the Chinese models, and that is unacceptable, Maria. So we are going to be looking at that in the coming days or weeks. But again, the U.S. government supports open source, but what we do not support is IP theft. The other question might be: Should companies that are using Chinese models have to disclose that to their customers?
M
Maria Bartiromo10:10
Good point. The Chinese Kimi K-3 is competitive with U.S. models on some benchmarks. The U.S. is going to be holding AI talks with China in September. You are leading that delegation to discuss with Chinese counterparts. From Axios, quote, a secret Trump administration battle to fight Chinese AI, including behind-the-scenes moves by the Commerce Department, National Security Agency, National Cyber Director, saying even considering completing an executive order saying U.S. companies can only host Chinese models if they can guarantee security, containing liability if it were breached.
S
Scott Bessent10:51
Again, you know, models have to be held to the same standard. U.S. models are more... Importantly, are they using stolen materials? There is a very technical AI word for it called distillation. We call it theft. They have hundreds of millions of hits against the large language models here in the U.S., and try to reconstruct their code and the thought process of the models. That is unacceptable.
M
Maria Bartiromo11:27
The Chinese are coming out with open source models, and they are cheaper. For an ordinary company, not necessarily one of the big major companies with the wherewithal to spend whatever they can spend on their own AI infrastructure, they, you know, a smaller company may need to go cheaper, want to use the Chinese version. Are they doing basically what they did with, they dumped cheap steel into the market? Now with AI models.
S
Scott Bessent11:59
I think the differences here we are starting to see merges of U.S. open source. Meta has two, NVIDIA one, a private company called Reflections, day background in the fall. Not exactly synonymous to what happened with steel. We are actually creating competitors. The largest European model? Combination open source, proprietary source, a Japanese combo open source. Again, the lowest cost you can't use counterfeit goods. Can't use counterfeit goods.
M
Maria Bartiromo12:45
What we are saying there, there are big opportunities for AI certainly, and there are also areas that we need to be aware of, in terms of theft, potential theft by adversaries. Can you walk us through where you see the biggest opportunity for AI on the economy? Because no doubt there are hundreds of billions of dollars moving into the U.S. economy for buildout infrastructure. We understand leading to a productivity boom, we've already seen by the way, extending it. But what about the big opportunities in terms of industry?
S
Scott Bessent13:17
It is going to be industry by industry, but it will be along the supply chain management, it will be in inventory management, optimize inventory. You are exactly right too, because AI, what we've seen thus far is not taking anyone's job. As a matter of fact, companies that have implemented large-scale AI implementation will be increasing jobs at a faster rate than the overall corporate pool. It is important, especially for young people. The person who will take your job is someone who knows how to use AI. So anything you can do to get trained up on that and be proficient, I would encourage everyone no matter what age they are.
M
Maria Bartiromo14:13
Great advice for viewers there, particularly people looking for jobs out of college. Talk about macro story. Secretary, this economy has been on fire, and now we see evidence inflation is going down. U.S. consumer prices gaining for the first time in six years? Union CPI inflation 3.5%, month-over-month prices down 4/10 of a percent, driven by big decline in gasoline prices since 2022. You say inflation will keep coming down. AI stands to double productivity. How would you assess the macro story today? Would I assess the macro story as very healthy? Because if we look, what gives me the great confidence is the underlying economy, general trend of the economy is very strong. Importantly on the other side, the core inflation number has not accelerated, despite a short-term rise in energy prices. So we've got strong underlying growth, core inflation under control, and that is a formula both for a great economy and for strong markets. What would be your expectation for growth in the second half of the year, Secretary?
S
Scott Bessent15:32
I am not going to give a guess, but I think that 3% is minimum, not unreasonable. I think we can start coming back towards Fed target level. I think PCE population versus CPI inflation, PCE has quirky things in it. Stock market goes up, and because of portfolio management costs, costs going up, I think those are going to be adjusted this year. I think inflation is under control. The what the President and HHS, Bobby Kennedy, Dr. Oz have done on drug pricing is fantastic. We're seeing the drug pricing down, and that affects all Americans.
M
Maria Bartiromo16:24
Yeah, one of the best parts I think of the President's agenda is how he zeroed in on the fact that the supply chain needs to be in America for the things America relies on. You talked about supply chain coming back to America. Critical to ensure U.S. can make and produce our pharmaceuticals, semiconductor chips, things national security related. So much so that the U.S. government took a stake in Intel. What a move. Stock soared since you made that investment. Same with MP and the rare earth companies. Will there be more companies you are expecting to take stakes in?
S
Scott Bessent17:06
What we're trying to do is create market signals and show the market where we're going. In essence, trying to tell investors, okay, here is where the puck is going to be, skate to it quickly. We want private sector solutions. You are talking resilience. We in headquarters... a company. The lack of resilience, as I said many times, COVID was a beta test. If supply chains were to be cut off during a practically major power conflict, unfortunately we discovered we had been thinking too much about efficiency, too much about low cost, not enough about resiliency. So I can tell you this administration, across all agencies, whether it is Treasury, Commerce, DoD, U.S. Trade Representative, everyone is focused on resiliency. President Trump is going to hold us to that standard.
M
Maria Bartiromo18:12
Yeah. Of course, this week is a big week for tariffs because Section 122 tariffs expire, Section 301 tariffs can be implemented. President poised to unleash fresh tariffs on dozens of countries as soon as this week, we are told. As President imposed 50% tariffs on Canadian goods: cars, alcohol, dairy products. What is the trade discrimination that is at hand causing the President to hike tariffs on Canada?
S
Scott Bessent18:42
I think it is something that we've discussed with our Canadian colleagues for a long time, and they haven't done anything about it. Highly discriminatory on dairy products, U.S. alcohol beverages on Canadian shelves. So this is really just reciprocity in terms of what they have done to our great U.S. companies.
M
Maria Bartiromo19:09
Secretary, this has been an incredible week, final week before the House August recess. Juggle a lot of things. The CR, continuing resolution, what is most important in terms of priority? We are expecting the Democrats to shut down government again in October. And we just spoke with one of our guests, Congresswoman Schweiker, said we borrow $39,000 every second. What is in the CR? The CR has to include dollar-for-dollar spending cuts to ensure fiscal sanity. What is priority in terms of legislation in your view?
S
Scott Bessent20:00
A couple things. First of all, let's go back to the top of your show. That in terms of waste, fraud and abuse, if we can save hundreds of billions of dollars on that, we don't need to cut programs. So that is why this is an all areas of government, all-hands-on-deck to get this done. Part of it is to get us into balance and bring down this terrible deficit to GDP that we inherited. We are also working on the Clarity Act to make the U.S. the best place for digital assets. And I think we are at the one-yard line on that. It is in the Senate now. So we would like to see that passed before Congress heads home. And as you said, we don't need another government shutdown. Last year Democrats had the longest shutdown in history. And when I was on the Hill testifying, some Democrats had the temerity to say you are wrong on projects. I said no, it is because you shut down the government. They are willing to hurt the American people for cheap political points. Somehow a narrative that you can see brewing in Democratic circles where they say, well, because the President and Republicans have had the presidency, House, Senate, the American people will blame it on Republicans. I think you just... just like failed candidates had to pull off the stage. The American people are smart, not going to fall for that.
M
Maria Bartiromo21:39
Secretary, the President is going to be remarking, promoting Trump Accounts at a high school in Georgia. Nearly a month in, start Trump Accounts. Great idea. More than six million children enrolled in tax-deferred investment accounts. Newborns eligible. How would you assess the program? What do families need to know?
S
Scott Bessent22:07
When they need to know, go to TrumpAccounts.gov. If a child is born during President Trump's term, Treasury will seed with a thousand-dollar investment into a Next Fund. Great. Philanthropists Michael and Susan Dell putting $2.65 billion up for America's children. We have seen it adopted by the state of Oklahoma. So you don't have to be eligible for the Treasury seed. Foundations are putting money in. Many corporations are putting money in. And we're seeing, I think that this is the most important social benefit for young people since the GI Bill. And I have been an advocate for financial literacy for more than a decade. Very important to me. My family has been one of our philanthropy. I think it's great for financial literacy. 38% of American households don't own equities. The goal of this is to eradicate that, and a lot more viewers for you.
M
Maria Bartiromo23:26
I agree with you. I am also an incredible supporter of financial literacy, have been a long time. I was delighted to see this policy. Secretary, great to see you this morning. We so appreciate your time. Thank you, sir.
S
Scott Bessent23:38
Good to be with you.