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Speaker 1: Live from our nation's capital. This is Bloomberg sound On

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Speaker 1: talking about a huge issue here is investment in marginalized communities.

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Speaker 1: They want to deconstruct this package and cherry pick what

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Speaker 1: they like what they don't like. China is surgeon power

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Speaker 1: with major investments. Bloomberg sound On the insiders, the influencers,

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Speaker 1: the insids. Biden has promised again and again that he

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Speaker 1: will unite the country. Who do you think Biden has

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Speaker 1: to watch in terms of moderate defectors in the structure

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Speaker 1: has always been guard part of the Bloomberg sound On

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Speaker 1: on Bloomberg Radio, Happy Tuesday. I'm Emily Wilkins. Coming up

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Speaker 1: on today's show. We're going to be talking with Senator

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Speaker 1: Marsha Blackburn on a technology hearing today in the Senate.

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Speaker 1: We have stuff on taxes, we have stuff on President

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Speaker 1: Biden's joint addressed to Congress tomorrow. I'm Emily Wilkins, along

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Speaker 1: with Bloomberg Politics contributors Jenny shan Zano and Rick Davis,

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Speaker 1: who is actually joining me live in the studio. Very

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Speaker 1: excited in this time of COVID feels like nature is healing.

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Speaker 1: We're getting back to normal. Uh, and we've got some

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Speaker 1: more News Today on President Biden's tax plan. I feel

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Speaker 1: like it's been coming out all this week in ahead

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Speaker 1: of his April addressed to Congress. Today's News eighty billion

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Speaker 1: dollars to boost the Internal Revenue Services audit capacities over

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Speaker 1: the next decade. The idea, if there are more audits,

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Speaker 1: if there are better audits, we can catch people who

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Speaker 1: are trying to finagle their way around the tax code.

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Speaker 1: Joining us on the line to discuss a little bit

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Speaker 1: more is our Bloomberg Tax Senior reporter Alison Vestparral. Alison,

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Speaker 1: thank you so much for joining us today. Walk us

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Speaker 1: through a little bit of this proposal. So much of

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Speaker 1: what President Biden has tried to do with his tax

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Speaker 1: plan is target the wealthy and the rich. Is this

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Speaker 1: yet another proposal of his that would do that. Yes, absolutely,

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Speaker 1: So that's what we're really seeing, Uh, we're going to

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Speaker 1: see in this plan that's coming up. Um. So obviously

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Speaker 1: you mentioned the eight billion dollars for the I R

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Speaker 1: S over the next ten years. You know, the thought

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Speaker 1: is that that could bring in seven hundred billion dollars

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Speaker 1: in additional revenue. Um. You know, I think one of

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Speaker 1: the things that you have to think about with that, though,

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Speaker 1: is that we're going after the wealthiest individuals, the wealthiest corporations.

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Speaker 1: Those are the people that have the resources to to

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Speaker 1: kind of fight you back it. Also, you know, the

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Speaker 1: agency has lost more than twenty employees over the last decade,

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Speaker 1: and so it's going to take time for them to

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Speaker 1: bring those people back, get the people trained so that

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Speaker 1: they can do those highly complicated audits. What we're also

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Speaker 1: seeing them what we're learning today is that the Biden

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Speaker 1: administration would end a currently I allowed tax benefit benefit

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Speaker 1: known as a step up in basis, which allows airs

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Speaker 1: to pay much smaller capital gains tax on their inherited

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Speaker 1: property UM. So that benefit would go away, which would

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Speaker 1: mean significantly higher capital gains for those airs UM. The

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Speaker 1: Senate Democrats have proposed something similar, but with an exemption.

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Speaker 1: We're still waiting to see if the Biden administration would

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Speaker 1: take that kind of approach. Another proposal, aimed again at

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Speaker 1: the rich, would raise the top individual tax rate to

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Speaker 1: thirty nine point six percent for individual or for taxpayers

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Speaker 1: making at least four hundred thousand dollars. That's up from

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Speaker 1: thirty seven percent today. And we're also seeing that individuals

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Speaker 1: are married couples earning more than one million dollars a year,

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Speaker 1: we'll have to pay that higher thirty nine point six

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Speaker 1: percent rate on their capital gains, up from plus a

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Speaker 1: star tax that helps fund Obamacare. What that all means

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Speaker 1: is that wealthy investors can face a federal capital gains

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Speaker 1: tax rate as high as forty three point four percent, so,

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Speaker 1: you know, almost double what they pay today. Alison, this

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Speaker 1: is I was wondering if you could comment a little

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Speaker 1: bit in general about the com the combination of all

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Speaker 1: these things. Seven billion additional revenue by the I R

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Speaker 1: S going through those people who are technically flandaggling, uh,

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Speaker 1: you know, on their taxes, and then and then these

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Speaker 1: big almost doubling of the capital gains tacks, and and

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Speaker 1: and and and almost as much on uh the personal

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Speaker 1: top rate. And on top of that, a significant seven

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Speaker 1: percent increase on corporate taxes. Uh do we do we

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Speaker 1: are we concerned with this kind of heavy load coming

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Speaker 1: in year one? I mean, obviously all these things will

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Speaker 1: be phased in, but um, but is it the kind

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Speaker 1: of thing that could actually stifle economic growth? If if

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Speaker 1: if we see this kind of attack on wealth creation?

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Speaker 1: So this this question was actually raised yesterday in a

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Speaker 1: White House briefing, and one of the president's top economic

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Speaker 1: advisors you know, said specifically on the Capitol games increase

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Speaker 1: that they're not worried that just will hurt long term

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Speaker 1: investment um essentially, you know, saying that there are other

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Speaker 1: things that play into investment decisions. We've seen Republicans though,

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Speaker 1: or you know, other opponents of that change, you know,

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Speaker 1: saying that it will. So it's I think it remains

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Speaker 1: to be seen. But those discussions are definitely playing out,

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Speaker 1: and I think that will play a factor. And you know,

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Speaker 1: how these negotiations go on Capitol Hill and whether all

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Speaker 1: of this ultimately gets passed. Alison, so much of what

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Speaker 1: the Biden administration they want these taxes to cover that

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Speaker 1: upcoming infrastructure bill, the Social Infrastructure bill UM. They also

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Speaker 1: sort of have a reason there to play up how

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Speaker 1: much there's taxes are going to come in because they

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Speaker 1: want to say, hey, look we have the bill paid for.

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Speaker 1: So they've tossed out that seven hundred billion dollar number.

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Speaker 1: Do you think that that's an accurate estimate or is

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Speaker 1: the Biden administration being a little bit optimistic here? Right?

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Speaker 1: And so that's seven billion dollar figures for increasing the

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Speaker 1: I R S is audit capability. So you know we've

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Speaker 1: seen we've seen lower numbers. When you're talking about increasing

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Speaker 1: investment in the I R S, we've seen higher numbers.

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Speaker 1: I think the big factor is what I what I

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Speaker 1: mentioned at the top of this call. You know, this

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Speaker 1: is not going to be an immediate return on investment.

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Speaker 1: If you think you're going to spend the I R

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Speaker 1: S and see these huge numbers in the first year,

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Speaker 1: that's just not realistic. You know. I've talked to former

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Speaker 1: officials who have said, if you're hiring someone straight out

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Speaker 1: of college, it can take you know, two years to

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Speaker 1: fully train them on some of these really complicated issues

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Speaker 1: you know that you find on returns of wealthy individuals

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Speaker 1: and wealthy corporations. For someone more experienced, you may still

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Speaker 1: have to train them on very specific topics and you

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Speaker 1: have to teach them how to you know, look at

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Speaker 1: a return and actually find these maybe tax discrepancies or

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Speaker 1: places where people are under reporting. So it's not it's

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Speaker 1: definitely not immediate. I think it remains to be seen

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Speaker 1: on how much can actually be brought in. I think

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Speaker 1: everyone agrees that if you fund the I R S

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Speaker 1: more you will see some money coming back, um, but

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Speaker 1: there's just some disagreement over you know, how big that

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Speaker 1: figure actually is. So Allison, can I take you back

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Speaker 1: to the capital gains increase? If what I'm hearing mixed

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Speaker 1: mixed data on this, if the increase did go through,

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Speaker 1: would we see an increase in revenue from that or

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Speaker 1: or no? Because that's something I'm hearing mixed messages on. Right.

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Speaker 1: So there's been uh, there was a pen Wharton um,

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Speaker 1: you know model that came out that basically said, if

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Speaker 1: you just do that in a vacuum without getting rid

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Speaker 1: of the stept up basis benefit that I mentioned, that

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Speaker 1: you could actually lose revenue. If you tie those two together,

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Speaker 1: then you know you will see an increase um. So

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Speaker 1: I think that's part of the interesting thing about these

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Speaker 1: provisions is that they all interact with each other, and

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Speaker 1: you know, whether or not there's revenue coming in kind

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Speaker 1: of depends on what gets enacted in the end. Excellent, Well, Alison,

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Speaker 1: thank you so much for taking the time to join

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Speaker 1: us today. That was Bloomberg Tax Senior reporter Alison vest Barrel,

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Speaker 1: always on top of the latest and greatest news in taxes.

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Speaker 1: I mean this is just such an interesting plan that

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Speaker 1: we're seeing the Biden administration come out with. Clearly, this

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Speaker 1: is all targeted at finding pay force for their wider policy,

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Speaker 1: but at the same point, it does seem that there's

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Speaker 1: a potential that the entire package isn't going to be

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Speaker 1: paid for, and that some of these tax proposals that

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Speaker 1: they're putting forward, we've already seen moderate Democrats come out

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Speaker 1: against how high they are. Yeah, Emily, I think you're

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Speaker 1: exactly right. I mean, you think about it. They've already

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Speaker 1: passed two trillion dollars worth of stimulus, and a lot

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Speaker 1: of that was tax cuts in the form of stimulus

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Speaker 1: payments and child tax credits, and now they're heaping for

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Speaker 1: trillion more dollars on top of that through these two

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Speaker 1: budget items that they're pushing for. And we've already heard

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Speaker 1: that not only is the tax and coming under some assault,

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Speaker 1: but even the elements of those four trillion dollars worth

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Speaker 1: of programs are coming un ourselves. So mix all that

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Speaker 1: in and you wonder is it going to collapse under

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Speaker 1: its own weight, or will there be efforts underway in

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Speaker 1: Congress to sort of pull out the pieces that can

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Speaker 1: work and be paid for without these steep tax cuts

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Speaker 1: or steep tax increases, and also not as expansive of

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Speaker 1: a program. I would think the Biden administration are in

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Speaker 1: deal making mode and they probably take at this stage

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Speaker 1: anything they can get. Genia, I'm wondering that you know,

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Speaker 1: most of these tax increases, they are targeted, like Alison said,

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Speaker 1: their targeted at the rich, at the wealthy, at these

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Speaker 1: major corporations. How does that play with the American people,

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Speaker 1: particularly with Democratic voters. Is this what they want to see?

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Speaker 1: Is this gonna sort of rile them up? Or is

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Speaker 1: this going to run into issues with the fact that

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Speaker 1: there are a lot of Democratic voters who are very

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Speaker 1: wealthy and our owners or have a stake in these

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Speaker 1: large companies. Yet, first, I want to say I'm jealous

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Speaker 1: of the two of you that you're together in studio

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Speaker 1: and I miss you both, um. But in terms of

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Speaker 1: your question, you know, I think I was thinking this morning,

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Speaker 1: we look at the census data that came out yesterday,

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Speaker 1: and you see people fleeing high tax states like New

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Speaker 1: York and California for places like Florida and Texas. You

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Speaker 1: couple that with a potential capital gains increase that in

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Speaker 1: states like California and New York will put people at

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Speaker 1: about fifty five, you know, a little more, a little

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Speaker 1: less percent taxation. Those are big, big numbers. So I

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Speaker 1: think you know the story on taxes politically as usually,

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Speaker 1: as long as it's not hitting me, I'm okay with it.

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Speaker 1: But the minute it hits me, that's a problem. So

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Speaker 1: I think what the Biden administration is going to have

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Speaker 1: to do very clearly is to argue that this will

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Speaker 1: not be transferred down. And already Republicans are speaking back

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Speaker 1: about that. They are saying, you think this isn't going

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Speaker 1: to hit you, well, look at what's going to happen

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Speaker 1: to the market. Look what's gonna happen to your four

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Speaker 1: oh one K, to your I Ray, to you know,

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Speaker 1: your income, your college savings, etcetera if this goes through.

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Speaker 1: So I think there's a lot of selling to do

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Speaker 1: on the democratics pert here absolutely well. Coming up next,

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Speaker 1: if you've ever sat down to watch one YouTube video

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Speaker 1: and then realized four hours later that you were still watching,

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Speaker 1: you're gonna want to hear our discussion with Senator Marshall

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Speaker 1: Blackburn sent her afternoon grilling executives at Facebook YouTube and

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Speaker 1: Twitter on their algorithms. When we come back, I'm Emily Wilkins.

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Speaker 1: This is Bloomberg. This is Bloomberg sound On on Bloomberg Radio.

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Speaker 1: I'm Emily Wilkins, along with Bloomberg's politics contributors Jimmie shon

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Speaker 1: Zano and Rick Davis, who is in person with me

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Speaker 1: in the studio. I am just going to jump right

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Speaker 1: into our next guest. I'm so cited to have her,

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Speaker 1: Senator Marsha Blackburn, Republican from Tennessee and a member of

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Speaker 1: the Esteemed Senate Judiciary Committee. This afternoon, she was talking

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Speaker 1: with the heads of Facebook, Twitter, and YouTube. You know what,

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Speaker 1: I've been here, Rick, I'm sure you've been here. Senator.

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Speaker 1: I'm sure that you are far above the habit of

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Speaker 1: wasting a great deal of time on some of these

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Speaker 1: social media sites, but scrolling through Facebook and Twitter for

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Speaker 1: really be so harmless that some of these algorithms program

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Speaker 1: addiction among children, and algorithms that it can actually sort

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Speaker 1: of show content that becomes more and more extreme. And Senator,

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Speaker 1: I'm wondering if you can just start a bit by

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Speaker 1: talking about whether these social media algorithms. Is there something

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Speaker 1: that Congress needs to do here do they need to

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Speaker 1: step in to how these al rhythms display content. One

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Speaker 1: of the things that we know from pediatricians and mental

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Speaker 1: health professionals is there is an impact on children on

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Speaker 1: issue with teens and suicides and the impact that is

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Speaker 1: attributed to social media on that. We also know that

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Speaker 1: the algorithms have a tendency to follow you. You know,

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Speaker 1: it's so if they create a bubble for you, basically

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Speaker 1: the things that you go in and look at, they

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Speaker 1: send you more of that. They find out what you're

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Speaker 1: interested in. So instead of expanding your world view and

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Speaker 1: having the world at your fingertips, what social media will

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Speaker 1: do is feed you more of what you're looking at.

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Speaker 1: So it has a tend to see to narrow the

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Speaker 1: variety and the diversity of things that you will search for,

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Speaker 1: look for, be curious about, or be drawn to. And

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Speaker 1: Senators sort of going off of that, then what anything

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Speaker 1: does is Congress's role here? I mean, what should Congress

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Speaker 1: be doing now that we know these certain things about

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Speaker 1: these algorithms and what we need to do is look

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Speaker 1: at changing their business model. Now, my approach on this

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Speaker 1: I call the Virtual You protection agenda because you have

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Speaker 1: to um deal first of all with online privacy and

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Speaker 1: give individuals the right to protect their virtual you and

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Speaker 1: their presence online. That I think is an imperative. You

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Speaker 1: have to give them the ability to say to big Tech, no,

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Speaker 1: I will opt to end and give you the right

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Speaker 1: to share my sensitive information if I want you to

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Speaker 1: share that. If I want you to share my browsing information,

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Speaker 1: for instance, then if I choose to keep that probate,

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Speaker 1: I'm going to opt out and this allow you to

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Speaker 1: share that information. So you have to have that opt

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Speaker 1: in and opt out reserved to the individual user. You

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Speaker 1: also need to have one set of rules for the

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Speaker 1: entire Internet ecosystem. You need to have one regulator in

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Speaker 1: charge of this, which is the FTC. You have to

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Speaker 1: have the ability for the individual who is on a platform.

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Speaker 1: If they choose to opt in and block and opt

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Speaker 1: out and block you from using different information, you cannot

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Speaker 1: boot them off that platform, and they they have the right.

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Speaker 1: If you're going to be the public square, then the

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Speaker 1: public square is open to everyone equally, and that is

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Speaker 1: what these big platforms started out to be. They wanted

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Speaker 1: to be the big public square, and if they're going

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Speaker 1: to do that, then they have to allow individuals, even

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Speaker 1: though that individual wants to reserve their privacy. Senator Blackburn, I,

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Speaker 1: I'm so happy to talk to you because one of

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Speaker 1: the things that came up today and has come up

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Speaker 1: a lot in the context of this discussion from a

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Speaker 1: conservative side, is this issue of personal responsibility. And I

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Speaker 1: understand you're talking about children, and then it comes to

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Speaker 1: parental responsibility. So what is your view, And I know

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Speaker 1: I don't have a lot of time for this, what

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Speaker 1: is your view on that issue of personal responsibility or

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Speaker 1: parental responsibility versus blame for the tech platforms in this

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Speaker 1: context well, and whether you're looking at utilization of social

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Speaker 1: media platforms or you're looking at vendors that are selling online,

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Speaker 1: there is a certain amount of personal responsibility there. But

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Speaker 1: you also have to look at the fact that when

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Speaker 1: you are using these social media platforms, you are the product.

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Speaker 1: Because their value is built on the number of eyeballs

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Speaker 1: that they can hold and have on their site, and

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Speaker 1: then what they will do is monetize by selling advertising.

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Speaker 1: Their big advertising agencies and they sell advertising to different companies.

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Speaker 1: So this is why you need privacy, you need data security,

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Speaker 1: you need Section to thirty reforms, and then antitrust. Senator

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Speaker 1: Marshall Blackburn with us stick around. She'll be back with

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Speaker 1: us after the break. I'm only Wilkin along with Bloomberg

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Speaker 1: Politics contributors Jennie shan Zano and Rick Davis. So unfortunately

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Speaker 1: Senator Blackburn had to run off to votes. The good

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Speaker 1: news is that your U. S. Senate is getting work

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Speaker 1: done for you. A bunch of nominations going on today,

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Speaker 1: but good news. We've still got plenty to discuss on

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Speaker 1: today's program. It has been a non stop newsday. Taken

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Speaker 1: from earlier today when our colleague David Weston spoke to

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Speaker 1: Democratic Congresswoman Stephanie Murphy of Florida about President Biden's two

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Speaker 1: point to five trillion dollar infrastructure package. Here's the sound

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Speaker 1: on that. I don't think anybody can disagree that it

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Speaker 1: has been decades too long overdue, that we have not

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Speaker 1: made real investments in our infrastructure, and that enables our economy.

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Speaker 1: We have to make these investments so that we remain competitive,

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Speaker 1: especially with our new peer competitors like China. That was

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Speaker 1: Congresswoman Stephanie Murphy, one of the more moderate Democrat ats

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Speaker 1: within the House, kind of really a good barometer of

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Speaker 1: what can or cannot get done here. Um, Genie, I

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Speaker 1: want to come to you here for a second, because

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Speaker 1: obviously the speech that we're going to hear from President

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Speaker 1: Biden tomorrow is more of him selling this plan to

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Speaker 1: the American people, really making sure that he has the

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Speaker 1: buy in from voters across the political spectrum. And I'm

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Speaker 1: wondering how important is the infrastructure component going to be

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Speaker 1: to the more social component, the component that talks about

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Speaker 1: the child terry tax credit, the pay leave, potentially a

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Speaker 1: few things dealing with healthcare. It's such an important question

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Speaker 1: because I think, um, that the selling aspect of this

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Speaker 1: is critical for the Biden administration. And they know that

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Speaker 1: they learned that from President Obama. Um and and he

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Speaker 1: did not do enough of that with the health care bill,

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Speaker 1: and that came back to be a problem for him.

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Speaker 1: So they've got to do that. They've got to do

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Speaker 1: that starting tomorrow, which is what they intend to do.

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Speaker 1: You now, we know from polls, Monmouth being one of

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Speaker 1: the latest, but there's been several public polls that vast

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Speaker 1: swaths of this plan, both the American Jobs Plan and

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Speaker 1: the American Families Plan, register as popular to the American public.

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Speaker 1: The problem is is that once they get down into

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Speaker 1: the weeds making, you know, making the deals they need

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Speaker 1: to make to get something this mammoth done, that's where

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Speaker 1: we may see some drop off in some of those numbers.

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Speaker 1: And that's what I think the Biden administration really has

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Speaker 1: to you know, really steal themselves against and I hear

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Speaker 1: and I'm sure you're hearing it that they're going to

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Speaker 1: be using some big, sweeping language to make this point

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Speaker 1: competitiveness democracy over autocracy reminiscent of L B J and FDR,

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Speaker 1: to try to rally the troops, if you will, and

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Speaker 1: convince the voters to convince their members of Congress to

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Speaker 1: get behind the bill. Of course, all that said, this

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Speaker 1: is gonna come down to where do people like Joe Mansion,

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Speaker 1: Chris Coons, Kristens, thema uh, you know, some of those

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Speaker 1: people Shelley Moore Capital who David Weston just talked to

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Speaker 1: as well, where do they sit on this? And that's

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Speaker 1: where the convincing needs to happen. Genie and I want

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Speaker 1: to pick up on that, because you know, while he's

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Speaker 1: selling to the American people like what you describe, he's

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Speaker 1: got to sell to Congress, and and no more important

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Speaker 1: individual to sell to than than Joe Mansion, Democrat from

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Speaker 1: West Virginia. And he's been very clear. He's like, look,

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Speaker 1: I want traditional infrastructure. I don't want all these bells

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Speaker 1: and whistles and and And he's also talked a lot

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Speaker 1: about the fact that he wants us to go through

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Speaker 1: regular order, take it through the committees, allow amendments, do

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Speaker 1: the job of Congress, not reconciliation. And then at the

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Speaker 1: end he says, and by the way, you're charging too

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Speaker 1: much in taxes to pay for all this. Now, if

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Speaker 1: you ask me, there are a lot of things to

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Speaker 1: unpack in that comment. And I think as the Biden

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Speaker 1: administration looks at this, they're going to have to figure

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Speaker 1: out a way to be able to handle not just

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Speaker 1: the American public, but a lot of these questions being

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Speaker 1: raised in Congress today. And Rick, I also want to

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Speaker 1: ask you a little bit. I mean, you were a

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Speaker 1: former national campaign manager for John McCain. You're in touch

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Speaker 1: with what Republicans want. One of the things that President

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Speaker 1: Biden has said that he wants to do with his speech,

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Speaker 1: or at least Biden's advisors has said he wants to

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Speaker 1: do with this speech is really reach out to those

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Speaker 1: Republican voters who feel disenfranchised, who feel that the government

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Speaker 1: has sort of abandoned them a little bit, and who

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Speaker 1: voted for President Trump. What message do they need to

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Speaker 1: hear from President Biden tomorrow. Yeah, it's a good question, Emily,

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Speaker 1: because he talks a lot about wanting to reach across

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Speaker 1: the island, be pipartisan, but in the first hundred days,

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Speaker 1: which this speech will signify, look what I've accomplished, there's

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Speaker 1: no bipartisanship in those accomplishments. Uh. Everybody wants to tackle COVID.

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Speaker 1: They agree with that, but he passed a Democrat only

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Speaker 1: COVID bill, and the bills on the floor now don't

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Speaker 1: have a bipartisan feature to them. So uh, at the

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Speaker 1: end of the day, he's going to have to put

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Speaker 1: something on the table that Republicans can vote for, and

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Speaker 1: right now they don't see anything coming their way. So, Rick,

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Speaker 1: am I taking it that you're not buying the Biden

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Speaker 1: Administration's new redefined definition of what is bipartisanship. It means

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Speaker 1: nothing about what's happening in Washington. But is it supported

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Speaker 1: in the polls? You know, Look, I mean I think

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Speaker 1: everybody has always said, you know, posters all the time

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Speaker 1: tell me. Look, you know, there's a lot of a

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Speaker 1: lot of polarization out there in America, but one thing

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Speaker 1: they all agree is they want Congress to work together.

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Speaker 1: So I actually think what we talked about with Joe

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Speaker 1: Manson are gonna go where he says, you know, let

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Speaker 1: this go, Let the infrastructure bill go through committees. That's

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Speaker 1: Congress working together. Don't try and bypass the process. Let

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Speaker 1: them do it. And then whether or not Joe Biden

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Speaker 1: wants to sign what comes out of that is up

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Speaker 1: to him. But it's up to the will of Congress

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Speaker 1: to put those pieces together. And my guess is there's

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Speaker 1: a stronger chance that you'll have a bipartisan approach if

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Speaker 1: you allow that process to go forward. So it looks

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Speaker 1: like at this point, I mean, we're really just sort

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Speaker 1: of very much paying attention to President Biden at this point.

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Speaker 1: I mean, it's always interesting with these State of the

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Speaker 1: Union addresses, or rather the joint Addresses to Congress on

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Speaker 1: exactly how much meaning they have and exactly how much

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Speaker 1: they change the game. But it seems like at this point,

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Speaker 1: if President Biden has decided that his main message needs

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Speaker 1: to go to the American voters rather than members of Congress,

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Speaker 1: that this is an opportunity for him to really go

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Speaker 1: ahead and take advantage of it tomorrow. So it'll be

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Speaker 1: interesting to hear exactly what President Biden says. We're going

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Speaker 1: to be covering it all tomorrow night. Please stick with

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Speaker 1: us here at Bloomberg and coming up, it's the day

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Speaker 1: you've been waiting for. The CDC is lowering its standards

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Speaker 1: for mask mandates. I'm Emily Wilkins. This is Bloomberg. You're

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Speaker 1: listening to Bloomberg Sound On on Bloomberg Radio. Hi. I'm

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Speaker 1: Emily Wilkins, along with Bloomberg's politics contributors Jamie shn Zano

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Speaker 1: and Rick Davis, live from the Bloomberg d C Bureau.

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Speaker 1: It is little more than twenty four hours before President

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Speaker 1: Joe Biden gives his first address to Congress. Don't call

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Speaker 1: it the State of the Union. That's the next year.

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Speaker 1: This is the president's first addressed, so it's called the

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Speaker 1: Joint Address. Little fun fact of trivia for you to

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Speaker 1: take their into your weekend. But you know this address,

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Speaker 1: it comes at this really important time as President Biden

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Speaker 1: is trying to sell the nation on his infrastructure plan,

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Speaker 1: on his quote unquote social infrastructure plan. That's things like

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Speaker 1: child tax care credits, paid time off, things that go

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Speaker 1: to workers. But of course there has been a lot

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00:25:44,720 --> 00:25:49,960
Speaker 1: of partisan contention over this speech. Wyoming Senator Senator John Barrasso,

433
00:25:50,040 --> 00:25:54,480
Speaker 1: a Republican, criticized President Biden today, saying that he's been

434
00:25:54,520 --> 00:25:59,080
Speaker 1: working too closely with progressive lawmakers, and he talked a

435
00:25:59,080 --> 00:26:03,080
Speaker 1: little bit of two us about President Biden's planned dress.

436
00:26:03,119 --> 00:26:05,879
Speaker 1: Here is the sound on that tomorrow night, when the

437
00:26:05,880 --> 00:26:09,520
Speaker 1: President addresses the nation that usually stands behind the Seal

438
00:26:09,560 --> 00:26:11,800
Speaker 1: of the President, what it really ought to say tomorrow

439
00:26:11,840 --> 00:26:13,840
Speaker 1: is not seal of the President. It should say sold

440
00:26:13,880 --> 00:26:18,280
Speaker 1: out to progressives. Oh burn Rick Davis, who is here

441
00:26:18,320 --> 00:26:21,120
Speaker 1: with me live in the studio as signed, we are

442
00:26:21,320 --> 00:26:24,159
Speaker 1: still six feet away. But if we are at the

443
00:26:24,200 --> 00:26:26,920
Speaker 1: point where we can go maskleiss according to CDC guidance.

444
00:26:27,119 --> 00:26:30,880
Speaker 1: But tomorrow night, Uh, there has been this comparison between

445
00:26:31,119 --> 00:26:36,360
Speaker 1: President Biden and between President Franklin D. Roosevelt and Biden's

446
00:26:36,400 --> 00:26:40,720
Speaker 1: proposal and Roosevelt's new deal. Although the two presidents they've

447
00:26:40,760 --> 00:26:43,719
Speaker 1: been really different with their styles. So who's showing up

448
00:26:43,720 --> 00:26:49,720
Speaker 1: tomorrow night the bipartisan dealmaker Joe Biden or f DR? Well,

449
00:26:49,760 --> 00:26:52,520
Speaker 1: we know Hillary Clinton used to channel Eleanor So it's

450
00:26:52,560 --> 00:26:54,920
Speaker 1: now I guess Joe Biden's chance to do a little

451
00:26:55,000 --> 00:26:58,520
Speaker 1: challenge channeling of FDR. You know, I really it's it's

452
00:26:58,520 --> 00:27:01,119
Speaker 1: a great question because when you look at the policies

453
00:27:01,200 --> 00:27:03,400
Speaker 1: and you and you look at the Republican reaction to it,

454
00:27:03,840 --> 00:27:06,040
Speaker 1: I feel like I'm being transported back to the early

455
00:27:06,119 --> 00:27:09,119
Speaker 1: nineteen thirties. You know. The policies are sweeping, it's a

456
00:27:09,160 --> 00:27:14,560
Speaker 1: redistribution of wealth across a lot of different economic areas. Uh,

457
00:27:14,800 --> 00:27:18,040
Speaker 1: massive spending to bring the government out or the country

458
00:27:18,080 --> 00:27:21,240
Speaker 1: out of an economic collapse and uh. And the arguments

459
00:27:21,280 --> 00:27:23,840
Speaker 1: that Republicans have is, hey, you know, in in nineteen

460
00:27:23,920 --> 00:27:26,840
Speaker 1: thirty three, it was a these are socialist programs, and

461
00:27:26,880 --> 00:27:30,280
Speaker 1: what what's happening today? Hey, these are socialist programs, And

462
00:27:30,320 --> 00:27:33,879
Speaker 1: so I suspect we're gonna see h A A A

463
00:27:34,000 --> 00:27:36,720
Speaker 1: Joe Biden. That sounds a lot more like fdr than

464
00:27:36,760 --> 00:27:40,720
Speaker 1: the old Joe Biden. Absolutely, and it'll be very interesting

465
00:27:40,760 --> 00:27:43,440
Speaker 1: to see exactly how he sells it because President Biden

466
00:27:43,480 --> 00:27:45,440
Speaker 1: has said that he doesn't want to sell this this

467
00:27:45,560 --> 00:27:48,399
Speaker 1: message cell is probably not his preferred word, but he

468
00:27:48,520 --> 00:27:52,240
Speaker 1: does want to give the message to Republicans, including Republicans

469
00:27:52,280 --> 00:27:54,920
Speaker 1: who voted for Trump. Obviously he's trying to get them

470
00:27:55,000 --> 00:27:57,720
Speaker 1: on board with this plan. Um. But I also want

471
00:27:57,760 --> 00:28:00,359
Speaker 1: to talk a little bit about some other news that

472
00:28:00,440 --> 00:28:05,360
Speaker 1: happened this week. Reapportionate, which sounds very wonky, but basically

473
00:28:05,400 --> 00:28:08,800
Speaker 1: means that the census is done. And they sat there

474
00:28:08,800 --> 00:28:10,800
Speaker 1: and said, okay, how many people are in each state?

475
00:28:11,040 --> 00:28:12,959
Speaker 1: And then they said, all right, we need to assign

476
00:28:13,119 --> 00:28:16,080
Speaker 1: each state a new number of US representatives. So we

477
00:28:16,119 --> 00:28:19,520
Speaker 1: saw some states go up. We saw other states go down,

478
00:28:19,640 --> 00:28:23,639
Speaker 1: states going down, notably California for the first time. New

479
00:28:23,720 --> 00:28:27,960
Speaker 1: York just by a tiny, tiny margin, wound up losing

480
00:28:28,320 --> 00:28:31,240
Speaker 1: one of their seats, and a lot of areas along

481
00:28:31,280 --> 00:28:35,600
Speaker 1: the rest bell in Michigan, Ohio. And I'm wondering here

482
00:28:35,720 --> 00:28:37,720
Speaker 1: if this is sort of a good time for us

483
00:28:37,760 --> 00:28:39,840
Speaker 1: to step back and look at the policies of thout

484
00:28:39,920 --> 00:28:42,200
Speaker 1: some of these states I mean Texas, which is a

485
00:28:42,240 --> 00:28:45,720
Speaker 1: state known for business friendly policies and low taxes, picked

486
00:28:45,800 --> 00:28:49,320
Speaker 1: up not one, but two more seats in the House

487
00:28:49,360 --> 00:28:52,440
Speaker 1: of Representatives. That's a little bit more power for Texas

488
00:28:52,480 --> 00:28:55,880
Speaker 1: and for Texas voters. I mean, Jamie Can you may

489
00:28:55,880 --> 00:28:58,520
Speaker 1: be weighing a little bit here is should we be

490
00:28:58,600 --> 00:29:02,160
Speaker 1: looking at this reapportion and mint and sort of saying, hey,

491
00:29:02,200 --> 00:29:05,720
Speaker 1: this whole low taxes, business friendly policy. We can clearly

492
00:29:05,760 --> 00:29:09,120
Speaker 1: see from how Americans are moving that Americans seem to

493
00:29:09,160 --> 00:29:11,760
Speaker 1: prefer that to some of the high tax policies and

494
00:29:11,800 --> 00:29:15,000
Speaker 1: other states. I think there is truth to that. It's

495
00:29:15,000 --> 00:29:18,760
Speaker 1: hard to draw a direct comparison because, of course, historically

496
00:29:19,160 --> 00:29:22,360
Speaker 1: the northeastern states are the oldest states, and and people

497
00:29:22,440 --> 00:29:26,880
Speaker 1: do tend to move out and stretch across the country historically.

498
00:29:27,160 --> 00:29:30,400
Speaker 1: But to your point, where these population centers are going,

499
00:29:30,440 --> 00:29:34,440
Speaker 1: are these lower tax, more business friendly states. That has

500
00:29:34,480 --> 00:29:38,320
Speaker 1: been the trend, and we see that not just with individuals,

501
00:29:38,320 --> 00:29:41,160
Speaker 1: of course, but we see it with corporations as well.

502
00:29:41,680 --> 00:29:44,680
Speaker 1: Um they have workers. They want people to be able

503
00:29:44,720 --> 00:29:47,400
Speaker 1: to live and afford to live in the place right

504
00:29:47,440 --> 00:29:49,800
Speaker 1: near where they work. Much harder to do in a

505
00:29:49,880 --> 00:29:52,680
Speaker 1: place like New York, where I happen to be, and

506
00:29:52,720 --> 00:29:54,640
Speaker 1: I just want to circle back on New York for

507
00:29:54,680 --> 00:29:57,840
Speaker 1: a minute and say that, you know, you mentioned how

508
00:29:57,880 --> 00:30:01,520
Speaker 1: close it was. It is astonished, Shing that New York

509
00:30:01,600 --> 00:30:05,320
Speaker 1: missed out on retaining its seat by eighty nine people.

510
00:30:05,640 --> 00:30:07,680
Speaker 1: I mean, I think there's eighty nine people in my

511
00:30:07,760 --> 00:30:11,000
Speaker 1: office right now, so you know, you imagine that. And

512
00:30:11,080 --> 00:30:13,520
Speaker 1: this is why Andrew Cuomo came out to came out

513
00:30:13,560 --> 00:30:15,840
Speaker 1: today and said New York is going to be looking

514
00:30:15,840 --> 00:30:19,320
Speaker 1: at legal options, which raises another challenge, right which is

515
00:30:19,360 --> 00:30:22,320
Speaker 1: that this thing was already pushed back because of the

516
00:30:22,360 --> 00:30:26,720
Speaker 1: Trump policy in last year and because of COVID, we

517
00:30:26,800 --> 00:30:29,959
Speaker 1: may see lawsuits that really make it difficult as we

518
00:30:30,000 --> 00:30:33,720
Speaker 1: look to the mid term elections in two and these

519
00:30:33,840 --> 00:30:37,040
Speaker 1: redrawing of these districts in these states where obviously Republicans

520
00:30:37,120 --> 00:30:40,160
Speaker 1: retained the advantage across the country is going to be difficult,

521
00:30:41,240 --> 00:30:43,520
Speaker 1: you know, Emily, picking up on the redistricting theme that

522
00:30:43,560 --> 00:30:45,400
Speaker 1: you were talking about, I talked to a couple of

523
00:30:45,480 --> 00:30:47,880
Speaker 1: candidates who are like thinking to run in for Congress

524
00:30:48,000 --> 00:30:50,560
Speaker 1: this next cycle, and one of them was in Arizona

525
00:30:50,600 --> 00:30:52,760
Speaker 1: thinking they were going to run in a brand new

526
00:30:52,920 --> 00:30:56,720
Speaker 1: district which they didn't get and want want and uh

527
00:30:56,800 --> 00:30:59,040
Speaker 1: and then uh. In addition to that, one was coming

528
00:30:59,080 --> 00:31:00,800
Speaker 1: out of Texas who says, jeesus, I don't know where

529
00:31:00,840 --> 00:31:02,480
Speaker 1: these districts are going to be. I mean, I don't

530
00:31:02,520 --> 00:31:04,680
Speaker 1: even know where to live. You gotta live in your districts.

531
00:31:04,680 --> 00:31:06,200
Speaker 1: So where you're gonna live if you don't know where

532
00:31:06,200 --> 00:31:08,120
Speaker 1: the districts are going to be. So there's gonna state

533
00:31:08,200 --> 00:31:09,840
Speaker 1: where they don't have that just moved to a state

534
00:31:09,840 --> 00:31:12,520
Speaker 1: where as long as you're there, you're totally good. Exactly

535
00:31:12,600 --> 00:31:15,120
Speaker 1: go to the state that didn't get affected. Um. And

536
00:31:15,160 --> 00:31:17,360
Speaker 1: so when you look at the process to where you

537
00:31:17,440 --> 00:31:21,000
Speaker 1: have some states are really a political line drawing where

538
00:31:21,000 --> 00:31:23,520
Speaker 1: the legislature gets around. If you're a majority of Republican,

539
00:31:23,560 --> 00:31:26,080
Speaker 1: you draw the lines that are good for Republicans. Two

540
00:31:26,160 --> 00:31:29,400
Speaker 1: states that have commissions that have no political you know,

541
00:31:29,480 --> 00:31:31,600
Speaker 1: sort of biased to them, and are going to try

542
00:31:31,600 --> 00:31:35,080
Speaker 1: and put these things down by geography, it's it's you're

543
00:31:35,120 --> 00:31:39,200
Speaker 1: gonna have a long time before you actually know what

544
00:31:39,360 --> 00:31:41,880
Speaker 1: the demographic impact of this is going to be politically,

545
00:31:42,160 --> 00:31:45,880
Speaker 1: especially this year because remember this all got delayed with

546
00:31:45,920 --> 00:31:49,240
Speaker 1: the census. We're getting these reapportionate numbers much later than

547
00:31:49,280 --> 00:31:52,320
Speaker 1: previous years, and at this point states don't know yet

548
00:31:52,360 --> 00:31:57,400
Speaker 1: what areas have gained or lost population. Remember these congressional districts, um,

549
00:31:57,440 --> 00:31:59,840
Speaker 1: I mean they are drawn a little bit. You know,

550
00:32:00,000 --> 00:32:02,240
Speaker 1: you've got the gerrymanderin, you've got the sort of puzzle

551
00:32:02,280 --> 00:32:05,360
Speaker 1: pieces there. But at the same point, they are expected

552
00:32:05,400 --> 00:32:08,640
Speaker 1: to sort of encapsulate, capsulate a certain percentage of people.

553
00:32:08,920 --> 00:32:11,520
Speaker 1: And so it matters if you know how much cities grew,

554
00:32:11,600 --> 00:32:14,520
Speaker 1: how much the suburbs grew. That's all going to factor

555
00:32:14,560 --> 00:32:17,560
Speaker 1: into some of these calculations as well as, of course

556
00:32:17,640 --> 00:32:20,680
Speaker 1: the state legislatures. I mean, they play a very critical

557
00:32:20,800 --> 00:32:23,920
Speaker 1: part right here, and at this point Republicans have the

558
00:32:24,000 --> 00:32:27,240
Speaker 1: upper hand. There are more state legislatures that are controlled

559
00:32:27,240 --> 00:32:30,959
Speaker 1: by Republicans, the House, the Senate, and the governor, and

560
00:32:31,000 --> 00:32:32,920
Speaker 1: they are going to have a bigger say, and they're

561
00:32:32,960 --> 00:32:36,320
Speaker 1: going to want to redistrict in favor of Republicans. So

562
00:32:36,360 --> 00:32:38,920
Speaker 1: I think I saw a statistic yesterday saying that about

563
00:32:39,040 --> 00:32:42,520
Speaker 1: three to five seats could be gained for Republicans simply

564
00:32:42,600 --> 00:32:45,720
Speaker 1: through this redistricting process alone. Oh yeah, and when you

565
00:32:45,760 --> 00:32:47,960
Speaker 1: look at a mid term election, like what's coming up.

566
00:32:48,120 --> 00:32:50,680
Speaker 1: The advantage is always with the party out of power anyway.

567
00:32:50,760 --> 00:32:53,480
Speaker 1: So typically you see a thirty vote swing in the

568
00:32:53,480 --> 00:32:56,600
Speaker 1: House of Representatives just because of mid term election, which

569
00:32:56,600 --> 00:32:59,360
Speaker 1: would firmly put the House in Republican control. And then

570
00:32:59,360 --> 00:33:02,280
Speaker 1: you start adding advantages that they may have coming out

571
00:33:02,280 --> 00:33:04,920
Speaker 1: of redistricting, and you really gotta wonder who's the next

572
00:33:04,920 --> 00:33:09,400
Speaker 1: Speaker of the House of Representatives in And you know, sorry,

573
00:33:09,440 --> 00:33:11,280
Speaker 1: I'm just gonna say that, I think this brings us

574
00:33:11,320 --> 00:33:13,400
Speaker 1: back to what you guys were just talking about about.

575
00:33:13,440 --> 00:33:15,800
Speaker 1: You know, Biden wanting to be FDR. He may want

576
00:33:15,800 --> 00:33:19,080
Speaker 1: to be FDR, but FDR also had a much wider

577
00:33:19,120 --> 00:33:22,120
Speaker 1: margin in Congress. And as you were just talking about,

578
00:33:22,160 --> 00:33:25,000
Speaker 1: this is going to get much much more narrow likely

579
00:33:25,280 --> 00:33:27,480
Speaker 1: going into the mid term. They have a narrow majority

580
00:33:27,520 --> 00:33:31,120
Speaker 1: in in the House right now, think about two if emily,

581
00:33:31,160 --> 00:33:34,160
Speaker 1: to your point, Republicans gain a few seats just by

582
00:33:34,240 --> 00:33:37,640
Speaker 1: this practice, let alone the historical reality in the modern

583
00:33:37,680 --> 00:33:40,480
Speaker 1: era that the president's party, the party of the president charge,

584
00:33:40,520 --> 00:33:42,920
Speaker 1: is gonna lose seats. They are in danger of loving

585
00:33:43,040 --> 00:33:45,880
Speaker 1: losing this. So if Biden wants to go big, he's

586
00:33:45,880 --> 00:33:47,880
Speaker 1: going to have to do it now or he's not

587
00:33:47,920 --> 00:33:51,360
Speaker 1: going to have much of a choice after this genie.

588
00:33:51,360 --> 00:33:54,080
Speaker 1: That is exactly the mindset of a number of lawmakers

589
00:33:54,120 --> 00:33:58,080
Speaker 1: who I talked to on Capitol Hill, particularly progressive lawmakers,

590
00:33:58,080 --> 00:34:00,240
Speaker 1: who are saying, you know what, we have the he's

591
00:34:00,280 --> 00:34:02,800
Speaker 1: to the car right now, and we are not guaranteed

592
00:34:02,840 --> 00:34:06,040
Speaker 1: them after the end of two So let's do this.

593
00:34:06,240 --> 00:34:09,319
Speaker 1: Let's go big. And I think too in the in

594
00:34:09,400 --> 00:34:12,040
Speaker 1: terms of going big, there is a memory of what

595
00:34:12,200 --> 00:34:15,320
Speaker 1: happened the last time that Democrats controlled the House, the Senate,

596
00:34:15,360 --> 00:34:18,000
Speaker 1: and the White House. They got through that Affordable Care Act.

597
00:34:18,280 --> 00:34:21,600
Speaker 1: Was it controversial, yes, did it cost them seats yes?

598
00:34:21,800 --> 00:34:24,000
Speaker 1: Is the whole country still on board with it? No?

599
00:34:24,480 --> 00:34:26,920
Speaker 1: But they were able to get it done and it

600
00:34:27,080 --> 00:34:29,399
Speaker 1: is still there, and it is at this point, I think,

601
00:34:29,440 --> 00:34:32,480
Speaker 1: a really lasting piece of policy that's going to be

602
00:34:32,520 --> 00:34:37,200
Speaker 1: difficult for Republicans to overturn completely. And so Democrats sort

603
00:34:37,200 --> 00:34:39,920
Speaker 1: of have seen that when they do do these big pushes,

604
00:34:39,960 --> 00:34:42,400
Speaker 1: they are able to get things done. And I know

605
00:34:42,480 --> 00:34:44,640
Speaker 1: that that's really on the minds of a lot of

606
00:34:44,680 --> 00:34:47,799
Speaker 1: individuals right now. The question, though, is can they do

607
00:34:47,840 --> 00:34:50,240
Speaker 1: it with fifty votes in the Senate and get anything

608
00:34:50,280 --> 00:34:53,440
Speaker 1: passed there between now and really the end of this session,

609
00:34:53,840 --> 00:34:56,920
Speaker 1: nevertheless reloading for an election year, which it even becomes

610
00:34:56,920 --> 00:34:59,680
Speaker 1: more difficult. So, as you said, Emily, the clock is

611
00:34:59,760 --> 00:35:03,000
Speaker 1: to King absolutely, and that's why we're continuing to watch

612
00:35:03,040 --> 00:35:05,759
Speaker 1: those those moderate members of Congress. Heck, I mean, at

613
00:35:05,760 --> 00:35:08,080
Speaker 1: this point, any senator can sort of push the button

614
00:35:08,360 --> 00:35:10,959
Speaker 1: and be the one to sort of stall up legislation.

615
00:35:11,400 --> 00:35:13,520
Speaker 1: Keeping an eye on that definitely going to be a

616
00:35:13,560 --> 00:35:16,480
Speaker 1: discussion that we're going to continue to have throughout the

617
00:35:16,520 --> 00:35:20,680
Speaker 1: next several weeks, next several months. Jeanie Rick, Thank you

618
00:35:20,680 --> 00:35:23,799
Speaker 1: guys both so much for your time and talents. Thank

619
00:35:23,840 --> 00:35:26,600
Speaker 1: you to Allison, thank you to Senator Blackburn, and thank

620
00:35:26,640 --> 00:35:28,719
Speaker 1: you to all of our listeners who are joining us

621
00:35:28,719 --> 00:35:32,000
Speaker 1: for today's show. Tune in tomorrow make sure you tune

622
00:35:32,000 --> 00:35:35,760
Speaker 1: in for our Biden joint address coverage. Thank you for listening.

623
00:35:36,000 --> 00:35:39,200
Speaker 1: I'm Emily Wilkins, and this is Bloomberg