Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Let's keep it on
Speaker 1: the geopolitics. Global leaders gathering at the Munich Security Conference,
Speaker 1: the US Secretary of State Marco Rubio leading a delegation
Speaker 1: as the Trump administration pushes Transatlantic ties potentially to their limits.
Speaker 1: The Republican Senator Tom Tillis is on the ground in
Speaker 1: Munich and he joined us now for more. Senator, welcome
Speaker 1: back to the program. Forgive me for doing this life
Speaker 1: in the moment. But the news just crossed. This is
Speaker 1: on Ali Baba reporting from Reuters. So the Trump administration
Speaker 1: is expected to add Ali Baba to a list of
Speaker 1: firms that allegedly help China's military. This according to reports
Speaker 1: sur just moments ago. Senator, Clearly the US administration and
Speaker 1: Congress for that matter, is looking to put a bit
Speaker 1: of a squeeze on China. Landing in Europe and Munich, Germany.
Speaker 1: Do you believe that you have the Europeans on side
Speaker 1: in this effort.
Speaker 2: I think we do.
Speaker 3: But let's go back to Alli Bob and honestly, any
Speaker 3: business that's homo solid in China, just anybody really believe
Speaker 3: that there's separation between the CCCP and the state owned
Speaker 3: enterprises and other supposedly independent businesses.
Speaker 2: I think the President is on.
Speaker 3: The right track to make sure that we're starting to
Speaker 3: hold China accountable. We need a good relationship with them,
Speaker 3: but it needs to be one that's founded on trust.
Speaker 3: And quite honestly, there are moves in China that I
Speaker 3: don't trust.
Speaker 1: So, Senator, with that in mind, should US base investors
Speaker 1: be able to have access to investing in these companies.
Speaker 3: Well, look, I've got a real problem with We've had
Speaker 3: a Banking Committee com meeting yesterday with Adkins before from
Speaker 3: the SEC, and I've got a real problem with the
Speaker 3: US getting into a trend of buying into some of
Speaker 3: our companies. I feel like we should let the free
Speaker 3: market really drive innovation. And also, back to the segment
Speaker 3: before I watched your prior segment, we've also got to
Speaker 3: unleash AI.
Speaker 2: We can't be afraid of it.
Speaker 3: We have to embrace it, we have to leverage it,
Speaker 3: and we have to be the leader in innovating at it.
Speaker 1: Well, Senator, let's talk about that. Creative destruction is a
Speaker 1: feature of the US economy and American dynamism is something
Speaker 1: Leasa was talking about earlier on this morning Senator, I
Speaker 1: feel like there's an aversion to that these days, and
Speaker 1: a fear associated with some of the headlines we've all
Speaker 1: seen over the past week, the prospect of white color
Speaker 1: jobs being wiped out. How do we prepare for a
Speaker 1: moment like that and ensure that what globalization did to
Speaker 1: manufacturing doesn't happen to services with AI?
Speaker 3: Well, we have to be ever watchful, But the bell
Speaker 3: has been wrong. We could either decide to be the
Speaker 3: innovation leader and work with our partners in our lives,
Speaker 3: the nations that we have military alliances worth to make
Speaker 3: sure that the Western world is still in the front
Speaker 3: of it. But I'm reminded of books that I read
Speaker 3: about the Industrial Revolution, and anytime that we've had a
Speaker 3: major leap in technology, we can't pretend like it didn't happen.
Speaker 3: Have to figure out how to master it and the
Speaker 3: best practice and executing it and dealing with all the
Speaker 3: potential negative consequences and job displacement. I think the jury
Speaker 3: is still out on what the job displacement's going to be.
Speaker 3: Does it mean that we've got to put more money
Speaker 3: in education and retooling expertise around the needs of the
Speaker 3: AI future? Probably almost certainly, but we should resist it.
Speaker 3: We should make sure that we get rid of the
Speaker 3: patchwork of laws that are being implemented at the state
Speaker 3: level that are impediments to our own indigenous innovation and AI,
Speaker 3: come up with rules of the road at a federal level,
Speaker 3: and just unleash the power of the US innovation economy
Speaker 3: to lead the world to get into right.
Speaker 4: Senator, do you feel like internationally there's the same skepticism
Speaker 4: you're in Europe, it's known for regulating their experts in it,
Speaker 4: and it seems like a growing number of people feel
Speaker 4: like that is hampering some of the progress. I mean,
Speaker 4: is there the same kind of enthusiasm. What's the mood
Speaker 4: like around some of the AI story that's causing a
Speaker 4: lot of a lot of volatility, certainly here in the
Speaker 4: United States.
Speaker 3: For years, I've been trying to remind everyone of how
Speaker 3: critical we were of the GDPR data privacy, data breach
Speaker 3: policies of the EU implement it.
Speaker 2: They made mistakes, they corrected.
Speaker 3: Some of them, but then states started gold plating some
Speaker 3: of those policies California and other ones that are again impediments.
Speaker 2: To our tech sector.
Speaker 3: What we need are national rule. This is clearly interstate commerce.
Speaker 3: We need to preempt these laws, make them better if
Speaker 3: we find the best practice, be.
Speaker 2: Instructed by that at some state level.
Speaker 3: But we need to set that platform right or the
Speaker 3: maligne users of AI are going to outpace our ability
Speaker 3: to stay up with them.
Speaker 2: That's why I think it's so important.
Speaker 3: I was the one, the only one actually nine and
Speaker 3: nine members voted against that. There was an amendment last
Speaker 3: year to try and preempt the AI laws at the
Speaker 3: state level come up with a national standard. I think
Speaker 3: that we need to do that very quickly, and we
Speaker 3: should road data, privacy data breach it there so that
Speaker 3: we get it right and maybe we have a gold
Speaker 3: plate of state or that Europe can be instructed by.
Speaker 4: In the meantime, as people are concerned about this leave
Speaker 4: of market transition and the pain that could come alongside it,
Speaker 4: it's one reason why there's been so much focus on
Speaker 4: the FED to reserve. It's one reason why people are
Speaker 4: saying it might behoove the FED to cut rates more
Speaker 4: aggressively in order to ease the pain for a number
Speaker 4: of individuals that otherwise might be losing their job. I mean,
Speaker 4: how much are you feeling satisfied in the process that
Speaker 4: you could get a hearing for the nominee Kevin worsh
Speaker 4: in the not so distant future. Do you think that
Speaker 4: that's feasible.
Speaker 3: Well, we could have a hearing all we want, but
Speaker 3: until the investigation is done, I still believe that the
Speaker 3: initial inquiry and the investigation was a flex to try
Speaker 3: and get the current chair to step aside. Chair Pale
Speaker 3: has a term as chair that expires in May. He
Speaker 3: also has a term that could extend for two more years.
Speaker 3: I have no intention allowing any FED Board nominee to
Speaker 3: move forward out.
Speaker 2: Of committee and to be confirmed until this matter is subtle.
Speaker 3: But this is foundational to FED independence, and I, for one,
Speaker 3: I'm going to stand on the side of certainty and
Speaker 3: better independence is what delivers certainty in our markets.
Speaker 1: So Senator is intriguing because we heard from the Treasury
Speaker 1: Secretary earlier on this morning speaking to the American press,
Speaker 1: and he said the following that I spoke with Republican
Speaker 1: senators early this week and I think we have agreement
Speaker 1: to go ahead with the Wash hearing. Do you have
Speaker 1: an understanding of where he's getting that impression from.
Speaker 3: Well, you know, I've said that if they shouldn't confuse
Speaker 3: or conflate two issues. The suggestion that we should have
Speaker 3: an oversight hearing to see how well this building project
Speaker 3: which the FED has gone, it's fine with me. In fact,
Speaker 3: I think we should have that kind of oversight for
Speaker 3: the East Wing construction, the upfit of the Air Force
Speaker 3: one that's kind of a mini Air Force one because
Speaker 3: it can't fly out of US boarders.
Speaker 2: All of that is just good governance oversight.
Speaker 3: None of that has anything to do with an investigation
Speaker 3: that I believe was dead on arrival. We are talking
Speaker 3: about two minutes of testimony that seven members of the
Speaker 3: Banking Committee, Republican members, including the Chair, have all said
Speaker 3: did not constitute a crime. We've got a prosecutor who's
Speaker 3: not listening to the eyewitnesses and continuing that's not productive.
Speaker 2: And I'm not going to I'm not going to allow it.
Speaker 3: Maybe they can commence the Democrats to vote with them,
Speaker 3: but as long as I'm the deciding vote. We can
Speaker 3: have mister Warsh, who I would love to be the
Speaker 3: next FED chair, but I'm not going to confirm the
Speaker 3: next FED chair until I can be absolutely certain that
Speaker 3: these sorts of flexes do not always.
Speaker 2: Have members of the Federal Reserve Board or the chair
Speaker 2: looking over.
Speaker 3: Their shoulder, wondering when they get the call from some
Speaker 3: US attorney with a dream.
Speaker 1: The Senator, if you had the call from Treasury or
Speaker 1: from the White House about this, when was the last
Speaker 1: time you had the conversation on the issue.
Speaker 3: Well, I've had a conversation with the American people c
Speaker 3: Span yesterday on the floor, and I don't think I
Speaker 3: was mincing words.
Speaker 2: I'm not really known for that.
Speaker 3: But if I need to make it very clear this
Speaker 3: is about an end are a resolution, I'll give the
Speaker 3: prosecutor the benefit of the doubt. Provide me with evidence
Speaker 3: beyond the two minutes of testimony and the committing that
Speaker 3: that seven Republican members said it was not criminal, it
Speaker 3: was not misleading, and that there was no criminal intent.
Speaker 2: It's it's it's like an indictment looking.
Speaker 3: For a crime, and to me, it just it's at
Speaker 3: the edge of absurdity that I can't accept. And the
Speaker 3: only thing I know that I can do is exercise
Speaker 3: my right as an individual Senator to hold up future.
Speaker 2: Nominations until this investigation is done.
Speaker 3: But to the to the to the assistant US Attorney,
Speaker 3: bring me evidence beyond the two minutes has been rejected
Speaker 3: out of hand by members by the majority of Republican
Speaker 3: members on the committee, or proved to me that there's
Speaker 3: been an instance where a referral. What's really odd about this?
Speaker 2: And I spoke about this on the Senate for you yesterday.
Speaker 3: This is the first time that I can find where
Speaker 3: a prosecutor moves forward with an investigation without a referral
Speaker 3: from the chair.
Speaker 2: Or a member of the committee. Maybe somebody can prove
Speaker 2: me wrong.
Speaker 3: But if that prosecutor has compelling information, either the way
Speaker 3: they read that two minutes or something else that no one's.
Speaker 1: Aware of, let me see it, Senator, before you go,
Speaker 1: time for one final question. You're in Munich. Let's finish
Speaker 1: where we started. Chancell Emerge just spoke moments ago and
Speaker 1: said the Transatlantic partnership is no longer self evident. Senator,
Speaker 1: how received? How well received was your delegation in Munich?
Speaker 3: Well, you know we're going to have I think we're
Speaker 3: going to have a lively discussion here.
Speaker 2: I had someone ask me about JD.
Speaker 3: Vansa's vice president of Vance's speech last year. I said
Speaker 3: that I wouldn't have given that speech, but I would
Speaker 3: not have missed the opportunity to let my family of
Speaker 3: nations in NATO know that one of the reasons we're
Speaker 3: here is because of the two trillion dollar deficit over
Speaker 3: twel years. Jonathan, Can you imagine how much more ready
Speaker 3: we could be if all the demand signals that would
Speaker 3: have come from two trillion dollars in weapons and our
Speaker 3: mutual defense had actually been purchased by the countries of
Speaker 3: NATO who have failed even meet their minimum requirement.
Speaker 2: So I think there's frustration there that we need to
Speaker 2: get passed. But I am speaking well. I believe for
Speaker 2: the majority of Congress who.
Speaker 3: Knows that the NATO Alliance is the most profound and
Speaker 3: impactful alliance in the history of mankind, and we stand
Speaker 3: behind it, and we will as we go through this
Speaker 3: discussion to get things back to Norman.
Speaker 1: Senator, appreciate your time. I know it's loud over there.
Speaker 1: Enjoy Europe. Thank you very much, sir. Senator Tom tillis
Speaker 1: there on the Federal Reserve on China and the relationship
Speaker 1: with the Europeans.