premieres wednesday, january 2 at 8 p.m. eastern and pacific on c-span. be sure to go online at moren.org/senate to learn about the program and watch original interviews with senators, view farewell speeches from long serving members and take a tour inside the senate chamber. the old senate chamber and other exclusive locations. >> this week on newsmakers we will talk with senators of two key states. senator james and half and senator chuck grassley of iowa who will take over the finance committee in the new year. senator grassley chairs the committee for the past four years to move over to finance where the committee has jurisdiction over taxes, tariffs and social security and medicare and medicaid. the previous chairs of the

committee were daniel webster and henry clay. senator jeff presley -- chuck grassley, you have been the chair of the judiciary committee and now for the 116th, you will be chairing the finance committee. why did you decide to make the switch? >> crazy rules of the republican caucus that you can only be chairman of a committee for six years. i'm chair of the finance committee four years. i got two years left to chair that. if i can predict in 21 and 22, we would still be in the majority, then i could finish my six years with judiciary over there. just suppose republicans are in the minority in 21 and 22, then i would not have been able to continue being ranking member of judiciary under those rules. and i've or used my six years

being ranking member of finance. preserveway to leadership as ranking member or chairman under the crazy rules of the republican congress. host: you have served on the finance committee for 34 some years of your career in washington. why is it that you want to, as you say use this time, two years as chair of the finance committee. for grassley: probably economic reasons and issues dealing with rural health care because iowa is a rural state. let me say some of the things i expect to come up along those areas. there is one i will mention that maybe we will not get to since we will have a democratic caucus, or democrat house but i put number one if i can make the last year's tax bills that would expire on the individual side 2025, if i could make them

permanent, that would be my number one goal. but that may not be feasible. so, then the other economic things that are pretty close would be the issues of the trade agreements that the president is negotiating already. u.s., mexico and canada. starting negotiations with japan and europe. then, hopefully get agreements with china. right at the top of my list. as far as i know, the way at least the united states-mexico- canadian agreements, if the president continues to negotiate good agreements like that, then i think for the benefit of agriculture and manufacturing in my state of iowa, it benefits all 50 states, i would want to and fairour free trade trade policies that will have -- we will have under those new agreements. then in the area of rural

health care i will not get into details but there are a lot of things you have to do because iowa is a low reimbursement state and it would be just kind havetural since we each $6,000 per medicare person compared to florida with $9,000 and we are five or six in quality. it would make sense to take money away from florida. so, we have a lot of thing that that are on the books that sunset from time to time that enhances the delivery of health care in rural america. and this is all rural states, not just iowa. i'd like to enhance that. then, for everybody in the country, whether it is rural or urban, we have got outrageous prescription drug prices. n working on this, some of this is in the area of judiciary but it also comes under medicare and medicaid. we have jurisdiction over medicare and medicaid.

i would hope to save the taxpayers money the same way i would want to save consumers drugs,y getting a, cheaper drugs on the market. generics as an example. host: let's focus on trade. president sign along with the mexican and canadian leaders of the g20, this trade deal, the new version of nafta. what is the timeframe for the finance committee to take that up? will there be hearings? what will be your approach as chair? approach,ley: my first of all he comes up on to the process on the floor of the limitedhat is has debates we do not have to have 60 votes to get it passed like you do a lot of things. i'm not sure i can give you the exact hours that are out there in the law that it can be debated but it is a limited amount of time. then there is a certain calendar for the committee to operate out of.

then get it out of committee. we will be holding hearings on it, of course. beyond that, since it's fast tracked, is a term we use, it will go to the floor regardless of what we do in committee, i think our hearings and to bring out a smaller group of people with greater in-depth the things that people might consider wrong about it or strengthen it. for me, it seems to me that unions have gained a great deal --m higher percentage of the being domestic produced parts. then for higher wages compared to the $3.00 in mexico, at least i think it is 50% has to be made by people making at least $16 an hour. i would hope that manufacturing that as -- wouulld see

beneficial. in the area of agriculture particular with canada where they have been restrictive on our dairy products and we going into canada, that is very much liberalized. host: do you think it passes the congress, this trade agreement? sen. grassley: there is no doubt it passes the senate. let's look at the house of representatives. we have heard some democrats, and i can't quantify it, but some democrats that said it is not strong enough on environment, not strong enough on labor. but surely, the economic benefits are well enough. now, if you go back 20 years, we never worried about environment and labor but in recent agreements we have been negotiating those things with other countries and having strong environmental and labor things, good thing to do. but i would think you would not hang this up particularly under the threat that the president will pull us out of the nafta of agreement.

no democrat would want to go back to the pre-nafta environment with high municipality-- with high tariffs. we have developed the mexican and the united states economy a. great deal as a result of nafta i'm not saying that all of nafta is fair. that is why it was renegotiated. host: you will also have said that you would like to limit the president's authority to impose tariffs. how so? sen. grassley: that would be tariffhe 1963 kwennedy bill. let me back up for your audience. you know one of the 18 powers of congress is to make all policy in interstate commerce. so, everything dealing with trade is within the power of congress, not the president. but since there are things that happen maybe faster than congress can act, congress delegates some authority to the president. but in regard to national

security, they've delegated too much authority in my judgment. obviously they did that in 1963. that thedgment is president has too much discretion to declare national security as an issue for ta riffs. so senator portman and my colleagues senator first have good pieces of legislation. endorsing any i'm specific piece of legislation but i do endorse their goals. i have to make that a high priority. host: have you spoken to the white house about this? sen senator grassley: i have not. i don't have to. presidentt punish the or take away any authority for what he has done under 232, but for the future there would be basically just other judgments than just the president has made. the input from the secretary of defense as an example. host: have you spoken with the potential counterpart on the house side? and what you think how the

house would react to what you're proposing? sen. grassley: i think they would be favorable to it. i disagree with trump sometimes but probably the democratic-controlled house deals with, disagrees with the president most of the time but since they feel that it's been a misuse, generally,i think that, i have not talked to them. by the way, i will be meeting with the chairman of the ways and means committee soon after the new congress starts. him very well but i am going to get acquainted with him and see where we can cooperate and where we can't. but there will be a lot of differences, but that is just a way our process of government works. host: where do you think there will be common ground? sen. grassley: on perception drug prices. i do not know about the house. is that in the jurisdiction of the ways and means committee

like it is in the jurisdiction of our to midi through medicare or medicaid, or does that deal with the energy and health, commerce and energy committee? and i'm not sure i can knkow th -- know the rules of the house. how do youto trade, view the negotiations between the white house and china? sen. grassley: before i answer that question can i say overall if you asked the question about trade going back to the first six months of this president, i would say that i just wonder whether he knows what he is doing. but now after we have had mexico-canada,.s.- we have had success with south korea, we are negotiating with japan. we're negotiating with europe. we're hopefully going to have successful negotiation's with china. and he's made a good agreement at least in these two instances where we have it. i have a lot of confidence he

knows what he is doing. whereas maybe 18 months ago i could not have told you that. i've express that to the president. not only me but a lot of other republicans. we have got a be careful we do not have a trade war. he would say that time did not sound reasonable. but now it sounds more reasonable. what do you mean, he'd say, a trade war? we have had a trade war and we have lost it. so, he looks at trade this way. for 70 years, we have try to help the rest of the world coming out of world war ii. we were very rich. and the rest of the world was impoverished. that trade has done more to raise people out of poverty worldwide than anything else you could do. and so, he's come to the conclusion that i think a lot of americans agree with him, you want fgreree trade. we have free-trade.

you can get almost anything into our country you want to. give us the same base as you you. when you asked me the question u.s. me, i think it was about china. you have got to think that as background. now, we 90 days for the chinese to show that they're going to negotiate in good faith. if those 90 days go ok, i think we are going to have the stalling of the and position of the tariffs for a longer time. and maybe reach an agreement. now, if this is like it happened with china in the george h.w. bush administration, we were play for a sucker. i think this president knows 100 year view a of them leading the world. they are there is strategic. we're not that strategic. twoo from two years to

years, every election. he is aware of that. if you were to ask me about the negotiation with north korea. he said, you know, that when he meets with kim, h e thinks that it's a good faith effort. if it isn't, he said, maybe i will have to admit i misinterpreted him. i think he feels the same way with china. he things he has a good relationship with president xi, but it, he m aay ybe misjudging the guy. host: in our final minutes or so, how do you approach being the chair of a committee? as we said, he served as judiciary. you have been in this leadership role before. who sets the agenda, is it you? or the new majority leader mitch mcconnell? sen. grassley: i would say in my four years being chairman of the

judiciary committee, i have had no problem with, wtiith mcconne, the leader setting it. played aink that he very major role in the tax bill of a year ago. interests that are of to all members of the caucus and particularly of the president is interested in it, i think you could expect some input from the leader. short of that, it will be entirely up to me to make the agenda. and if i wanted to disagree with mcconnell, which i seldom disagree with, then, of course, i can still do what i want to do as chairman of the committee. now, you got to careful about that because of you put someone out of committee and the leader does not bring it up, you haven't accomplish the whole lot. so, i think i see myself as a

facilitator, whether it is republican leader or democrats on my committee. i have a very good working relationship with feinstein. a very good working relationship with durbin on criminal justice reform. you have to work to learn -- learn to work across party lines. you never get anything done in the senate if it is not bipartisan. when you have 60 votes, for reconciliation and republicans are never going to have 60 votes in the united states senate. the democrats of only had 60 votes in the 42 years i have been in congress. so, even the democrats and the majority have to have some bipartisanship. so, the senate is an institution that brings people together. unlike the house of representatives, whether you are the majority or republican majority, you can ignore the minority as long as you stick together. you can't do that in the united states senator. host: chairman chuck grassley, thank you. next up, james and hoffer chairs

the armed services committee. there is many committee overseeing the military since 1816. theddition to those duties committee also has control over the petroleum reserves and social security acts of nuclear energy. previous chairs, andrew jackson and jefferson davis. and hoff, james republican of oklahoma will begin the first full serve as senate armed services chairman. he spent most of 2018 is acting chairman and chairman following the death of senator john mccain. what is the difference about the job now that you are starting it on day one of the new congress? when john: either mccain was having problems had to go back to arizona, we still had voices from another director there. you never knew if it was going to be staffed or from john mccain. he was failing at that time. after he died, we became -- i

became the chairman. that was different because he put together our people. and before that we did not have our people. he's the staff director and he is the one that built his own staff. we can put together a program the way we wanted. ther ee can't be any question. acting director is not a lot of fun. we know whatew =-- is wrong with the military. between the staff and he has and he spent 8 years on the house armed services committee on the 20 years on the senate armed services committee, i know what we have done in the past. i k now we have gone through in the military under the eight years of obama. let me start by saying, i don't criticize obama. obama is a very sincere in heart liberal. he does not have a high priority on military.

and so, he readjusted his priorities so that we just had a real serious problem. we fell way behind our peer competitors russia and china. john: what are your priorities? sen. inoff: six of them. the first one, there is this document right here. this is the best one in the years i have been. this is called, this is the document. that is implementing what the president is trying to do and what he says his priorities are. this actually does it. what is good about this is it was put together by democrats and republicans, all experts that made this thing up. they put it together, they swore that they would tell the truth for a change. just what our condition is. to give you an example because this comes from this here. such quotes as "the commission,

esis commission, assess unequivocally that the mds, our defense system is not adequately resourced. america is near the point of strategic insolvency. america's military said. he has eroded to a dangerous degree. america's combat edge." all of these things we knew and the reason we knew them is that we had, they had people during his administration talking about howbad, our military is and behind it is. john: when was that document put together? was reported two weeks ago and are committee and it was put together probably a year and a half before that. they talk about how good this report is because it actually is unvarnished. it tells the truth. and the democrats and republicans agreed on that. now, individuals who do not have a high priority on military,

that it't like the idea is there, they do not like the attention it is good because they would rather have their priorities go somewhere else. so, to answer your question, on what our, our priorities are, number one, this would be the blueprint. this is what we are going to do to make all these things happen. and the second thing that is in our first category is what we're going to be doing with the india -- the defense authorization act. i have to say i was proud to be in the acting director when we put this one through last year. we put it through, the authorization bill for defense in a record time. the fastest in 40 years we have done it. why is that important? because you have to do the authorization before you do the appropriation. we want our military in harm's way to know that we are getting it done and fully informed, we understand what the threat is. the the second thing is the

readiness. we went through a readiness crisis during the obama years. our brigade combat teams, only 30% could be deployed because of maintenance. same thing with the army aviation brigades. , thathings with a f-18's is what the marines fly. only 65% of those could not be deployed because of maintenance problems. tha't's there is significant. third thing is modernization. people,eard a lot of liberals, people who do not have a high priority for defense, talking about the triad system. that is our nuclear modernization system which has not been modernized since 1980. all the time we have been doing nothing. this started prior to the obama administration. i can't hang all this on him. the triad system is defending america through submarines and bombers and icbm's. and all the time that we were

not doing anything, the chinese and the russians were passing -- in many of these areas. you talk about modernization, other some weapon systems that we are working on you do not think we need? sen, inoff: no. i think we do. it is such a moving target. hypersonic is a defense system. measuring artillery by how many rounds a minute. this is at a 10th of a one hundredths of a second. less than a couple months ago. was saying he is now ahead of the united states. he lies, so, i don't believe it. but nonetheless it shows they are busy. both russia and china. i don't want to imply that is the only threat out there. the president was right when he

put together his national security system he said we also have the rogue nations, iran, north korea who are developing the capability of reaching the united states of america with a weapon. so, that's serious, too. but in terms of peer competition, those were as good or better than we are in some of our systems, people say how coulud,d another country be betr than us? it is because and i know this is true ever since world war ii, we have built ourselves up where w e have the best of everything. now we don't. it is very important people understand that because you have to develop a budget. if you are going to give a priority to military, which we are going to try to do, that we have to get busy and people have to understand we don't have the best of everything. john: what does that budget look like in fiscal 2020? the president in early december calling the $716 billion on

a crazy number. and we are hearing that$750 believe is the number agreed to. sen. inoff: number one, he wants to rebuild our military. he knows what has happened. but then, i want you to listen very carefully, because no one believes this. so i have it well documented. if you take one obama did into two years that i compare are 2010 and 2015. the total2010, budget was $794 billion. in 2015, that had dropped down to $586. billion that is a drop of 24% over five years. instead of the normal growth, it was a drop. that is why we were really hurting. we have to really we build this

thing. we made a commitment and we successfully did it to raise it in fiscal year 18 to $700 billion. 760 billion.19 $ and the first budget for fiscal year 2020, the president had $7 30 billion. to me, that was all strategy. we knew we were not going to be cutting down and destroying everything we did in the two previous years. so, now when you hear things like $750 billion, this report the chairman of the joint chiefs of staff and others, the secretary of defense, they say the same thing. what we have got to do right now budget by 3% to

5% over inflation for the next five years. if you take $716 billion and you go to $733 billion, that is only an increase of 2.1%, below inflation. that does not do what all the smart people say we have to do. that is why you're getting all these numbers. johbn: what do you make of the president's pick? sen. inoff: he is a soldiers soldier. i was army. he's reallyink good. i think he's tough. he is, he's a pretty abrupt guy. he has the some of the personality that trump does. i think they are going to get along real well. i think he will do a great job. john: you served two years in

the army? sen. inoff: that was back in the days of the draft. the best thing to ever happen to me in my life was being drafted. ofn: do think the chairman the armed services committee should always have that experience, serving and the motility -- in the military? inoff: to go through basic training, that is something you should have, yeah. served under a lot of chairman and the house and senate, what is your style as a committee chairman? a little more hands-on. i like to get out on the field. i find out more in afghanistan in the mess hall are out in the field from the troops than i do from all of these hearings to have in washington. people are normally polished up and saying the right things and all that. i like to do that and see how people really are. what's surprising to me is these

kids that are out in the field, they knew during the obama years ng obama is an young people love them, the kids over there fighting, they knew exactly what his background was and they knew that they don't have maintenance. they knew we were losing lives because we were not properly maintaining equipment. the accidents we had, maritime and air accidents. there is not any way to exactly see how many people we lost. they knew that. because they were watching. john: you talk about your willingness to travel. do you expect or subcommittee chairman to see the troops? sen. inoff: most of them actually have. we have been together in recent years. i'll talk about the democrats on the committee are good. they are not as strong military, because the skill -- we all understand this. certainly there was a demonstration clearly by obama.

but the republicans that are on it are all the ones that really these issues and the chairman of the subcommittees these guys and gals, they really know their issues. when you talk to someone like mike rounds, he is into the cyber stuff. stuff i'm not into. that's why, one of the reasons we are using a lot more activity from subcommittee chairs is that they are actually specializing. you know, they all have things they like. one of the things i don't enjoy doing all the years i have been on the house and senate armed services committee is a personnel subcommittee. that wears me out. yet, senator tillis. that was his first choice. all of them are experts in our field.

john: i want to ask what your relationship is with jack reed. also, the incoming chairman of the house armed services committee, adam smith. start with let's adam smith because he is more difficult for me because we are two different philosophies. but we have been the big four for two or three different times and we are putting together defense ndaa. we've gotten along will well, express ourselves differently. but we are actually good friends. as far as jack reed is concerned, i can't think of any democrat serving in the united states senate that i would rather have as my counterpart as the minority leader in the, in the defense, in the military. so we get along real great. the guy has a great background. we agree on almost every military issue. john: jim inoff.

thank you for your time. [captions copyright national cable satellite corp. 2018] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] ♪ >> c-span's "washington journal" live every day with news on policy issues that impact you. coming up saturday morning we will discuss the stock market losses and interest rate hikes with our yahoo! finance reporter be sure to watch "washington journal" live at 7 a.m. eastern saturday morning. join the discussion. >> the house and senate are both scheduled to come in saturday to work on a government funding bill. senate leadership announced they would not take a vote until there was an agreement between them, the president and house of representatives. watch the house live on c-span and the senate on c-span 2. ♪

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