1 00:00:01,600 --> 00:00:05,600 Speaker 1: The US government has a serious spending problem. It's thrown 2 00:00:05,640 --> 00:00:09,160 Speaker 1: money at military needs, roads digging out of the pandemic, 3 00:00:09,680 --> 00:00:13,239 Speaker 1: mostly using cash it doesn't have in the bank. Just 4 00:00:13,320 --> 00:00:15,400 Speaker 1: like the rest of us paying off a loan, the 5 00:00:15,440 --> 00:00:19,000 Speaker 1: government has to pay interest on what it borrows. Over 6 00:00:19,040 --> 00:00:23,360 Speaker 1: the past decade, those interest payments have crept up. They've 7 00:00:23,360 --> 00:00:26,560 Speaker 1: become a bigger and bigger slice of federal spending, and 8 00:00:26,720 --> 00:00:30,320 Speaker 1: soon America will need to spend more each year paying 9 00:00:30,360 --> 00:00:33,800 Speaker 1: off that debt interest than it spends on national defense. 10 00:00:35,640 --> 00:00:38,560 Speaker 1: I've asked my sources at Treasury, in Congress, and even 11 00:00:38,600 --> 00:00:41,840 Speaker 1: some historians. No one can think of us ever being 12 00:00:41,920 --> 00:00:46,040 Speaker 1: here before. Everyone agrees we have a problem, but what 13 00:00:46,240 --> 00:00:48,879 Speaker 1: no one can agree on is where the buck stops 14 00:00:49,000 --> 00:00:55,720 Speaker 1: to fix it. America's debt is spiraling out of control. 15 00:00:56,080 --> 00:00:59,760 Speaker 1: It's over thirty four trillion dollars right now, and if 16 00:00:59,800 --> 00:01:03,240 Speaker 1: it feels like every other month Congress is nearly avoiding 17 00:01:03,240 --> 00:01:07,000 Speaker 1: a government shutdown over spending, that's because it kind of is. 18 00:01:08,280 --> 00:01:11,039 Speaker 1: This week, we'll look at how we got here and 19 00:01:11,120 --> 00:01:14,840 Speaker 1: what it will take for Washington to fix it. From 20 00:01:14,840 --> 00:01:18,800 Speaker 1: Bloomberg's Washington Bureau. This is the Big Take DC Podcast 21 00:01:19,240 --> 00:01:28,240 Speaker 1: I'm your host, Seleijamerson. Borrowing money is not always a 22 00:01:28,280 --> 00:01:32,679 Speaker 1: bad thing. In seventeen ninety, Alexander Hamilton wrote that debt 23 00:01:32,959 --> 00:01:36,720 Speaker 1: was the price of liberty. In Lynn Manuel Miranda's musical 24 00:01:36,760 --> 00:01:40,280 Speaker 1: about Hamilton's life, you can hear the young Treasury secretary 25 00:01:40,280 --> 00:01:42,240 Speaker 1: pleading with the other founding fathers. 26 00:01:42,400 --> 00:01:42,880 Speaker 2: If we are. 27 00:01:42,880 --> 00:01:47,120 Speaker 3: Hums jumla a credit a financial. 28 00:01:46,640 --> 00:01:50,200 Speaker 1: Tal you reddit without debt, He rap argues, the US 29 00:01:50,280 --> 00:01:52,800 Speaker 1: couldn't fund the fight to become an independent nation. 30 00:01:53,280 --> 00:01:55,920 Speaker 2: We needed money and guns in half a chance who 31 00:01:56,000 --> 00:01:57,240 Speaker 2: provided those funds? 32 00:01:57,640 --> 00:02:00,760 Speaker 1: So the US has really leaned into debt, so much 33 00:02:00,800 --> 00:02:03,160 Speaker 1: so that the last time the country has zero debt 34 00:02:03,440 --> 00:02:07,880 Speaker 1: was in eighteen thirty five. That's because each year the 35 00:02:08,000 --> 00:02:11,440 Speaker 1: US creates a massive budget. It's money that keeps the 36 00:02:11,440 --> 00:02:14,800 Speaker 1: economy moving, even when faced with challenges like a once 37 00:02:14,840 --> 00:02:18,280 Speaker 1: in a lifetime pandemic. But when the federal government wants 38 00:02:18,320 --> 00:02:20,880 Speaker 1: to spend more than it's bringing in through taxes and 39 00:02:20,919 --> 00:02:24,760 Speaker 1: other revenue, it has to borrow from other countries and 40 00:02:24,800 --> 00:02:28,360 Speaker 1: the private sector. That gap between our money in and 41 00:02:28,400 --> 00:02:30,359 Speaker 1: our money out is called a deficit. 42 00:02:30,600 --> 00:02:33,640 Speaker 4: Good think about it for your household. If everything I 43 00:02:33,720 --> 00:02:36,080 Speaker 4: owe is bigger than the assets I have. I'm in 44 00:02:36,120 --> 00:02:36,720 Speaker 4: a deficit. 45 00:02:37,280 --> 00:02:39,600 Speaker 1: My colleague Liz McCormick and I have spent a lot 46 00:02:39,639 --> 00:02:42,720 Speaker 1: of time talking about the deficit. She's a chief correspondent 47 00:02:42,760 --> 00:02:45,079 Speaker 1: at Bloomberg covering debt and currency markets. 48 00:02:45,440 --> 00:02:48,639 Speaker 4: So for the US, all the net revenues they're taking 49 00:02:48,680 --> 00:02:50,960 Speaker 4: in after they pay out all their expenses, they're in 50 00:02:51,040 --> 00:02:51,520 Speaker 4: the red. 51 00:02:51,840 --> 00:02:55,040 Speaker 1: Unlike a household spending more than it's bringing in. It's 52 00:02:55,080 --> 00:02:57,720 Speaker 1: okay for the US government to live its life in 53 00:02:57,760 --> 00:02:58,160 Speaker 1: the red. 54 00:02:58,440 --> 00:03:01,919 Speaker 4: We have the global what they call reserve currency, meaning 55 00:03:02,200 --> 00:03:05,360 Speaker 4: many things are priced in US dollars. It gives us 56 00:03:05,400 --> 00:03:08,520 Speaker 4: this kind of special status. No one quite thinks the 57 00:03:08,639 --> 00:03:11,680 Speaker 4: US is going to kind of really default. 58 00:03:11,280 --> 00:03:12,120 Speaker 3: On their data. 59 00:03:12,600 --> 00:03:15,399 Speaker 1: In other words, people trust that the US will pay 60 00:03:15,440 --> 00:03:18,720 Speaker 1: back its loans eventually, and they trust so deeply that 61 00:03:18,800 --> 00:03:20,880 Speaker 1: it's good for its dollar that they rely on it 62 00:03:20,960 --> 00:03:24,400 Speaker 1: as the backbone of the global economy. That's one reason 63 00:03:24,440 --> 00:03:27,400 Speaker 1: why America can run up such a high bill. But 64 00:03:27,520 --> 00:03:31,519 Speaker 1: lenders still want something in exchange for buying US debt. 65 00:03:31,919 --> 00:03:34,480 Speaker 4: There's no free lunch, so they're saying, yeah, hear, US 66 00:03:34,560 --> 00:03:37,320 Speaker 4: Treasury take our money. We like you take it, but 67 00:03:37,600 --> 00:03:40,640 Speaker 4: give me something every month because I'm kind of putting 68 00:03:40,640 --> 00:03:42,760 Speaker 4: my money to you and I can't use it right, 69 00:03:42,840 --> 00:03:44,920 Speaker 4: so please give me some what we call interests. 70 00:03:45,280 --> 00:03:47,720 Speaker 1: So when the government wants to fund a program, say 71 00:03:47,800 --> 00:03:50,600 Speaker 1: a new part for medicare, building a bridge, or helping 72 00:03:50,640 --> 00:03:54,120 Speaker 1: allies like Israel or Ukraine, even if we don't have 73 00:03:54,200 --> 00:03:56,840 Speaker 1: that money set aside, we can borrow it at a 74 00:03:56,960 --> 00:04:00,680 Speaker 1: very low cost to taxpayers. That's helped get out of 75 00:04:00,720 --> 00:04:05,880 Speaker 1: some really sticky situations. You may recall what newscasters and 76 00:04:05,960 --> 00:04:08,480 Speaker 1: headlines sounded like during the financial crisis. 77 00:04:08,600 --> 00:04:11,960 Speaker 4: Three of the five biggest independent firms on Wall Street 78 00:04:12,040 --> 00:04:13,920 Speaker 4: have now disappeared. 79 00:04:13,360 --> 00:04:16,360 Speaker 1: Wherey investors now wonder how the markets will recover from 80 00:04:16,360 --> 00:04:19,880 Speaker 1: billions of dollars of bad mortgage debts, frozen credit markets, 81 00:04:19,920 --> 00:04:21,360 Speaker 1: banks afraid to lend. 82 00:04:21,520 --> 00:04:24,120 Speaker 3: We are in the midst of a serious financial crisis. 83 00:04:24,600 --> 00:04:27,680 Speaker 1: That last clip was President George W. Bush speaking in 84 00:04:27,720 --> 00:04:30,680 Speaker 1: two thousand and eight, when the government used spending to 85 00:04:30,760 --> 00:04:33,560 Speaker 1: prop up a flailing economy, but that came with a 86 00:04:33,600 --> 00:04:37,000 Speaker 1: price tag of hundreds of billions of dollars. The federal 87 00:04:37,040 --> 00:04:40,039 Speaker 1: deficit nearly tripled from what it had been before the crisis. 88 00:04:40,839 --> 00:04:44,720 Speaker 2: Now every family knows a little credit card debt is manageable. 89 00:04:44,839 --> 00:04:47,480 Speaker 1: That's President Barack Obama speaking in twenty eleven. 90 00:04:47,920 --> 00:04:50,880 Speaker 2: But if we stay on the current path, our growing 91 00:04:50,960 --> 00:04:53,880 Speaker 2: debt could cost us jobs and do serious damage to 92 00:04:53,920 --> 00:04:57,279 Speaker 2: the economy. More of our tax dollars will go toward 93 00:04:57,279 --> 00:05:00,880 Speaker 2: paying off the interest on our loans. Businesses will be 94 00:05:00,960 --> 00:05:03,479 Speaker 2: less likely to open up shop and hire workers. In 95 00:05:03,520 --> 00:05:07,320 Speaker 2: a country that can't balance its books, interest rates could 96 00:05:07,360 --> 00:05:09,520 Speaker 2: climb for everyone who borrows money. 97 00:05:09,960 --> 00:05:13,360 Speaker 1: In twenty thirteen, US debts are passed the country's GDP. 98 00:05:14,320 --> 00:05:17,440 Speaker 1: When President Donald Trump took office, he worked with Congress 99 00:05:17,480 --> 00:05:20,480 Speaker 1: to cut taxes as a way to help grow the economy. 100 00:05:20,640 --> 00:05:22,840 Speaker 1: Those tax cuts will add an estimated two and a 101 00:05:22,880 --> 00:05:25,600 Speaker 1: half trillion dollars to the nation's deficit in the next 102 00:05:25,600 --> 00:05:30,400 Speaker 1: decade or so. And then COVID hit and lawmakers were 103 00:05:30,440 --> 00:05:32,719 Speaker 1: desperate to keep the economy afloat. 104 00:05:32,640 --> 00:05:36,599 Speaker 3: First, those stimulus checks up to fourteen hundred dollars for 105 00:05:36,680 --> 00:05:39,080 Speaker 3: about ninety percent of households. 106 00:05:38,560 --> 00:05:41,640 Speaker 1: Were making sure that small businesses have access to loans 107 00:05:41,680 --> 00:05:42,680 Speaker 1: for their fixed. 108 00:05:42,440 --> 00:05:45,839 Speaker 3: Costs, and expanded unemployment insurance. 109 00:05:45,640 --> 00:05:49,359 Speaker 4: During the pandemic, even as are borrowing shot up as 110 00:05:49,720 --> 00:05:52,160 Speaker 4: it kind of should in a crisis. We didn't want, 111 00:05:52,240 --> 00:05:56,120 Speaker 4: you know, companies and people to personally fail and not 112 00:05:56,200 --> 00:05:57,880 Speaker 4: be able to fund their life, so there was a 113 00:05:57,880 --> 00:06:01,320 Speaker 4: lot of fiscal support. The FED was cutting rates down 114 00:06:01,360 --> 00:06:02,680 Speaker 4: to zero. 115 00:06:03,560 --> 00:06:07,480 Speaker 1: Let's recap to keep the economy from creatoring the government's spent. 116 00:06:07,720 --> 00:06:10,479 Speaker 1: And then the Federal Reserve said, let's make it really 117 00:06:10,520 --> 00:06:13,200 Speaker 1: easy for people to borrow even more so that they 118 00:06:13,320 --> 00:06:16,839 Speaker 1: keep spending. So the FED slashed interest rates, making it 119 00:06:16,960 --> 00:06:18,279 Speaker 1: cheaper to take on debt. 120 00:06:18,400 --> 00:06:20,760 Speaker 4: But that's all been turned on its head now because 121 00:06:21,160 --> 00:06:23,520 Speaker 4: because of inflation, the Fed has had to lift rates 122 00:06:23,560 --> 00:06:25,440 Speaker 4: to like a twenty two year high. 123 00:06:25,839 --> 00:06:28,320 Speaker 1: That twenty two year high is a shock to the 124 00:06:28,360 --> 00:06:31,839 Speaker 1: economy right now. People and companies have gotten so used 125 00:06:31,880 --> 00:06:35,240 Speaker 1: to low interest rates that now everyone's adjusting to how 126 00:06:35,320 --> 00:06:38,000 Speaker 1: much more they have to pay for everything from car 127 00:06:38,080 --> 00:06:41,840 Speaker 1: loans to mortgages. And higher rates are hurting the governments 128 00:06:41,839 --> 00:06:42,480 Speaker 1: while at too. 129 00:06:42,839 --> 00:06:47,520 Speaker 4: And that's made the Treasury, every time they pay interest semiannually, 130 00:06:48,680 --> 00:06:51,640 Speaker 4: pay a lot higher interests. I mean, our interest expense 131 00:06:52,080 --> 00:06:55,000 Speaker 4: is almost the amount of you know what we're paying 132 00:06:55,160 --> 00:06:58,400 Speaker 4: for big other categories like defense. 133 00:07:00,040 --> 00:07:02,760 Speaker 1: In twenty twenty three, the cost of just paying off. 134 00:07:02,800 --> 00:07:08,040 Speaker 1: The interest on US debt reached a trillion dollars coming up. 135 00:07:08,320 --> 00:07:11,720 Speaker 1: As the US debt continues to climb, what's the growing 136 00:07:11,800 --> 00:07:19,600 Speaker 1: cost to taxpayers? The US debt has been climbing for decades, 137 00:07:19,920 --> 00:07:23,240 Speaker 1: but to understand why experts think now is different, I 138 00:07:23,280 --> 00:07:25,560 Speaker 1: wanted to talk to someone who's seen how the budget 139 00:07:25,600 --> 00:07:29,040 Speaker 1: is handled from the inside. So I sat down with 140 00:07:29,080 --> 00:07:32,760 Speaker 1: Philip Swagel. He's the director of the Congressional Budget Office 141 00:07:32,960 --> 00:07:36,160 Speaker 1: or CBO. It's a non part as an agency funded 142 00:07:36,160 --> 00:07:37,080 Speaker 1: by Congress. 143 00:07:37,440 --> 00:07:41,320 Speaker 3: We provide the Congress with budget analysis and economic analysis. 144 00:07:41,600 --> 00:07:44,120 Speaker 3: We would never say to a member of Congress, your 145 00:07:44,200 --> 00:07:47,160 Speaker 3: bill is the right thing or the wrong thing. We 146 00:07:47,520 --> 00:07:48,680 Speaker 3: just provide analysis. 147 00:07:48,920 --> 00:07:51,920 Speaker 1: If you're following news coverage of a proposed law, you've 148 00:07:51,960 --> 00:07:55,400 Speaker 1: probably heard CBO's estimate for how much that legislation will 149 00:07:55,400 --> 00:07:56,640 Speaker 1: affect the national debt. 150 00:07:56,920 --> 00:08:00,640 Speaker 4: The Congressional Budget Office released their ten year baseline for 151 00:08:00,680 --> 00:08:04,600 Speaker 4: farm bill spending. The Congressional Budget Office estimates these changes 152 00:08:04,680 --> 00:08:08,160 Speaker 4: could cost more than ninety billion dollars over the next 153 00:08:08,160 --> 00:08:08,840 Speaker 4: two years. 154 00:08:09,480 --> 00:08:11,880 Speaker 1: Swegel told me that there are two main reasons we 155 00:08:11,880 --> 00:08:16,160 Speaker 1: should care that the government can't get its debt under control. First, 156 00:08:16,360 --> 00:08:18,920 Speaker 1: it means that we have to spend money paying off interest, 157 00:08:19,320 --> 00:08:22,320 Speaker 1: as in managing the debt load, instead of using that 158 00:08:22,400 --> 00:08:26,840 Speaker 1: money for programs that actually help people. And second, it's 159 00:08:26,920 --> 00:08:29,320 Speaker 1: only going to get worse when. 160 00:08:29,120 --> 00:08:32,000 Speaker 3: We have higher interest rates, more debt, we pay more 161 00:08:32,000 --> 00:08:34,640 Speaker 3: in interest, and then that builds back into the debt, 162 00:08:34,960 --> 00:08:38,559 Speaker 3: which leads to yet higher debt and higher interest payments. 163 00:08:39,120 --> 00:08:41,360 Speaker 1: So it's a spiral. 164 00:08:41,840 --> 00:08:45,120 Speaker 3: We are in a spiral. Now, it's a slow spiral, 165 00:08:45,160 --> 00:08:49,000 Speaker 3: but it's still a spiral of rising debt and rising 166 00:08:49,000 --> 00:08:52,120 Speaker 3: payments on the debt. The situation is unsustainable. 167 00:08:53,080 --> 00:08:56,800 Speaker 1: Just this week, Nassim Nicholas Teleb, a former option strader 168 00:08:56,800 --> 00:08:59,720 Speaker 1: who wrote a book about unpredictable events called The Black 169 00:08:59,720 --> 00:09:02,600 Speaker 1: swam On, told a hedge fund that he advises that 170 00:09:02,640 --> 00:09:06,000 Speaker 1: a debt spiral is like a death spiral. He's not 171 00:09:06,080 --> 00:09:08,160 Speaker 1: the only one with eyes on the economy who's been 172 00:09:08,240 --> 00:09:12,240 Speaker 1: raising alarm bells. A few weeks ago, Robert Rubin, the 173 00:09:12,240 --> 00:09:15,680 Speaker 1: former Treasury secretary, put it bluntly on Bloomberg TV. No, 174 00:09:15,920 --> 00:09:17,679 Speaker 1: I think we're in a terrible place. And this is 175 00:09:17,720 --> 00:09:20,040 Speaker 1: all while the US has had some of the cheapest 176 00:09:20,040 --> 00:09:23,360 Speaker 1: interest rates of any country in the world. That's because 177 00:09:23,360 --> 00:09:26,440 Speaker 1: America has a solid record of paying back its loans, 178 00:09:26,920 --> 00:09:30,000 Speaker 1: so other countries cut a sweet deal when they loan money. 179 00:09:30,840 --> 00:09:34,160 Speaker 1: But that could all change. If the US keeps borrowing 180 00:09:34,160 --> 00:09:37,360 Speaker 1: from other countries and racking up a high bill and 181 00:09:37,640 --> 00:09:40,959 Speaker 1: continues to squabble over paying its debt, the country and 182 00:09:41,040 --> 00:09:44,320 Speaker 1: the US dollar could lose its favorite status. It's not 183 00:09:44,520 --> 00:09:47,880 Speaker 1: enough to avoid a default. Just the fighting is hurting 184 00:09:47,880 --> 00:09:50,839 Speaker 1: the country. It's like when parents fight and threaten to 185 00:09:50,880 --> 00:09:55,160 Speaker 1: divorce but don't. Just because they stay together doesn't mean 186 00:09:55,200 --> 00:10:00,240 Speaker 1: the fights don't cause damage. Our only hope for a 187 00:10:00,280 --> 00:10:02,520 Speaker 1: way out of this debt spiral is for Congress to 188 00:10:02,559 --> 00:10:06,160 Speaker 1: balance the budget, but that requires some hard decisions about 189 00:10:06,200 --> 00:10:10,599 Speaker 1: where to cut spending in Congress is famously deadlocked. 190 00:10:10,840 --> 00:10:12,840 Speaker 4: I don't want to be too pessimistic, but I just 191 00:10:12,880 --> 00:10:17,800 Speaker 4: don't see the political will down in Washington right now 192 00:10:18,160 --> 00:10:20,640 Speaker 4: to change their tune. We can't seem to work across 193 00:10:20,679 --> 00:10:23,440 Speaker 4: the aisle and get these agreements that would work to 194 00:10:23,480 --> 00:10:26,080 Speaker 4: put us at least on a trajectory where the deficit 195 00:10:26,120 --> 00:10:27,160 Speaker 4: should be getting better. 196 00:10:27,520 --> 00:10:31,000 Speaker 1: Right Even passing a basic spending bill has turned into 197 00:10:31,040 --> 00:10:34,840 Speaker 1: a high wire act, haunted by regular government shutdown threats, 198 00:10:35,280 --> 00:10:38,040 Speaker 1: So getting through any serious cuts is going to be hard. 199 00:10:38,480 --> 00:10:43,880 Speaker 3: The challenge is that at any moment, we don't have 200 00:10:44,000 --> 00:10:45,760 Speaker 3: to take action, right. 201 00:10:46,640 --> 00:10:49,680 Speaker 1: So it's hard to imagine folks in governments suddenly getting 202 00:10:49,679 --> 00:10:52,720 Speaker 1: inspired to take action. But there is at least one 203 00:10:52,800 --> 00:10:55,040 Speaker 1: example of a time when it got its act together. 204 00:10:55,760 --> 00:10:58,760 Speaker 1: Swegel says that back in the nineties, people thought that 205 00:10:58,800 --> 00:11:01,480 Speaker 1: the US might fully pay off its debt, and they 206 00:11:01,480 --> 00:11:02,520 Speaker 1: were worried about that. 207 00:11:03,160 --> 00:11:06,480 Speaker 3: And that's because of the privileged place of treasury securities. 208 00:11:06,559 --> 00:11:10,679 Speaker 3: The treasury debt has an important role in the global economy. 209 00:11:11,080 --> 00:11:13,720 Speaker 3: A treasury bond is an asset for the private sector 210 00:11:14,240 --> 00:11:17,320 Speaker 3: that is seen as safe and seen as liquid, and 211 00:11:17,400 --> 00:11:20,960 Speaker 3: so if investors want an asset with those characteristics, the 212 00:11:21,000 --> 00:11:23,920 Speaker 3: ability to buy and sell treasury bonds is important to 213 00:11:23,960 --> 00:11:24,840 Speaker 3: financial markets. 214 00:11:25,000 --> 00:11:29,080 Speaker 1: That fiscal responsibility didn't happen by accident. It essentially took 215 00:11:29,120 --> 00:11:33,560 Speaker 1: investors bullying President Bill Clinton's administration. Here's how that went. 216 00:11:34,920 --> 00:11:39,320 Speaker 1: Investors were against the government's unsustainable spending, so they revolted. 217 00:11:39,880 --> 00:11:43,000 Speaker 1: They started dumping their treasury bonds, and when those bonds 218 00:11:43,080 --> 00:11:46,680 Speaker 1: flooded the market, they appeared a whole lot riskier. It 219 00:11:46,760 --> 00:11:48,959 Speaker 1: was your basic laws of supply and demand at play. 220 00:11:49,520 --> 00:11:52,280 Speaker 1: When treasures are seen as even a tiny bit riskier, 221 00:11:52,760 --> 00:11:55,920 Speaker 1: buyers demand a higher return on their investment, kind of 222 00:11:55,960 --> 00:11:58,360 Speaker 1: like how your home insurance costs more if you live 223 00:11:58,400 --> 00:12:02,959 Speaker 1: in a flood zone. To recap, investors sold off treasuries, 224 00:12:03,120 --> 00:12:06,600 Speaker 1: which drove prices lower, but that drove up the amount 225 00:12:06,679 --> 00:12:10,280 Speaker 1: buyers demanded in exchange for each bond. That made it 226 00:12:10,360 --> 00:12:14,640 Speaker 1: more expensive for the government to borrow, and treasuries guide 227 00:12:14,640 --> 00:12:17,439 Speaker 1: the interest rate for all sorts of debt like home 228 00:12:17,520 --> 00:12:21,040 Speaker 1: mortgages and other consumer obligations. So all of a sudden, 229 00:12:21,240 --> 00:12:24,200 Speaker 1: you've got the makings of an economic slowdown, which is 230 00:12:24,280 --> 00:12:26,040 Speaker 1: every elected leader's nightmare. 231 00:12:26,480 --> 00:12:30,360 Speaker 4: Back in the Clinton days, you know, James Carville, his advisor, 232 00:12:30,760 --> 00:12:32,760 Speaker 4: always joked, like, I thought I'd want to come back 233 00:12:32,760 --> 00:12:34,920 Speaker 4: as what do you say, like a great baseball player 234 00:12:35,480 --> 00:12:37,320 Speaker 4: or the pope or something. And then he's like, I 235 00:12:37,320 --> 00:12:39,439 Speaker 4: want to come back as the bond market. Because Clinton 236 00:12:39,480 --> 00:12:41,640 Speaker 4: wanted to do all the spending and bond yields just 237 00:12:41,640 --> 00:12:42,760 Speaker 4: one crazy. 238 00:12:42,679 --> 00:12:45,480 Speaker 1: Clinton was forced to change his whole economic agenda just 239 00:12:45,520 --> 00:12:49,600 Speaker 1: to keep investors happy and prevent an economic crisis. Back 240 00:12:49,640 --> 00:12:53,360 Speaker 1: in the nineties, debt interest wasn't skyrocketing like it is today, 241 00:12:53,760 --> 00:12:56,119 Speaker 1: so it's a bit of an Apple's to Walnuts comparison. 242 00:12:56,679 --> 00:12:59,000 Speaker 1: But it's possible that the same kind of pressure from 243 00:12:59,080 --> 00:13:00,160 Speaker 1: markets could help. 244 00:13:00,320 --> 00:13:04,080 Speaker 4: Now. Maybe if bon Yeals just keep going and going 245 00:13:04,280 --> 00:13:08,160 Speaker 4: in this situation gets worse and worse, maybe somebody gets 246 00:13:08,200 --> 00:13:11,000 Speaker 4: religion and says we need to do something. But I 247 00:13:11,040 --> 00:13:12,199 Speaker 4: think it's going to take a lot. 248 00:13:14,320 --> 00:13:16,960 Speaker 1: Thanks for listening to The Big Take DC podcast from 249 00:13:17,000 --> 00:13:21,120 Speaker 1: Bloomberg News. I'm Salaia Mosen. This episode was produced by 250 00:13:21,200 --> 00:13:24,240 Speaker 1: Julia Press and Naomi Shaven. It was fact checked by 251 00:13:24,280 --> 00:13:28,800 Speaker 1: Stacy Rede. Alex Sugia and Blake Maples are mix engineers. 252 00:13:29,080 --> 00:13:32,880 Speaker 1: Our story editors are Caitlin Kenny, Wendy Benjaminson, and Michael Shephard. 253 00:13:33,240 --> 00:13:37,000 Speaker 1: Nicole Beemsterbower is our executive producer. Sage Bauman is our 254 00:13:37,040 --> 00:13:40,000 Speaker 1: head of podcasts. If you like what you heard, please 255 00:13:40,040 --> 00:13:42,920 Speaker 1: be sure to subscribe, rate, and review the show. It'll 256 00:13:42,920 --> 00:13:46,320 Speaker 1: help other listeners find us. Thanks for tuning in. I'll 257 00:13:46,360 --> 00:13:47,280 Speaker 1: be back next week.