Peter Schiff: Politics is Trumping Sound Policy

In this episode, Peter works through the latest news cycle, each part of which points to government malfeasance and political expedience overriding sound principles. He covers the latest Federal Reserve vote, the ballooning cost of servicing the national debt, inflation’s squeeze on ordinary consumers, the misuse of the strategic petroleum reserve, a troubling crackdown on press access at the White House, and Republican hypocrisy over a crypto lawsuit.

Peter opens with skepticism about the Federal Reserve’s supposed independence. He questions reports suggesting that the Fed chairman checked in with the president before casting his vote, essentially asking permission to go along with the rest of the board:

Now, if this actually happened, if the chairman of the federal reserve ran his vote by the president first to get his permission, went to the president to let him know how everybody else was voting before he decided what to do. And then when Donald Trump said, hey, you might as well vote with the board, it’s like Trump gave him a pass. … The question is, is Donald Trump lying?

From there, Peter pivots to the expensive elephant in the room: the sheer scale of federal debt and what happens as it gets refinanced at today’s higher rates. He lays out just how burdensome interest payments are becoming, even without any additional borrowing:

But if the US government has to pay 5% on the national debt, on the whole national debt, because as these bonds are maturing, they need to be rolled over, if the average cost on the $40 trillion national debt is 5%, you’re talking $2 trillion a year in annual interest payments. That’s 35% of current tax revenue. Now, that’s also more than we pay for Social Security by several hundred billion.

He brings the abstract numbers down to earth by pointing to a real-world example of who feels inflation the most. He highlights comments from a McDonald’s executive who is on the front lines of cost pressures affecting everyday Americans:

Now, this guy is on the ground floor. He’s in the trenches, right? He is selling hamburgers and French fries to the masses. And he is dealing with all of the cost pressures that are the result of inflation. Because a company like McDonald’s, you’re really trying to keep your costs down because you know your customers are not rich, by and large. … But the CEO is saying we can’t keep them down anymore.

Shifting to energy policy, Peter revisits the purpose of the Strategic Petroleum Reserve and how it’s been treated more like a political tool than an emergency backstop. He specifically calls out the Biden administration’s handling of it ahead of the 2022 midterms:

But the reserve is really meant for an emergency. Like we don’t have any oil. And the only way we’re gonna get it is from the strategic reserve. It’s not about price. Biden abused the reserves for political purposes back in 2022 when we were getting close to those midterms.

Peter then turns his attention to a more alarming trend: the White House restricting media access based on how favorably a network covers the president. He warns that Republicans cheering this on now are setting a dangerous precedent that could easily be turned against them down the road:

This should be a huge problem. It should be a big problem for Republicans because if the Republicans are gonna condone this kind of censorship from the White House, what’s gonna happen in 2029 when there’s a Democrat, is he gonna ban Fox News from coming to the White House? Is he gonna ban whatever networks are not reporting on the president the way the president wants to be reported? 

Finally, Peter closes out with a pointed critique of a proposed service that would give subscribers early access to President Trump’s market-moving social media posts. Noting the silence surrounding it from Republicans who would normally be quick to demand accountability, he argues that the case reveals a glaring double standard, one where partisan loyalty trumps regulatory consistency:

So this thing is completely unethical, but now you’ve given the Democrats just a layup here. So they finally filed this lawsuit, but it shouldn’t be some California lawyers, some DA or something. The SEC should be doing this. The Republicans should be saying something about this. They should not be going along with it because by going along with it, they are complete hypocrites.