Speaker 1: You're listening to the Bloomberg Sound on podcast. Catch us
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Speaker 2: This is our one and I did miss you. I
Speaker 2: have to say Happy New Year, since we haven't had
Speaker 2: a chance to say that yet. I know it's getting
Speaker 2: a little late. Do you go through that at the store,
Speaker 2: at the gas station? Now that we're a weekend, do
Speaker 2: you still say Happy New Year? I'm still saying it
Speaker 2: Happy twenty twenty four. It's going to start coming together
Speaker 2: now as Congress returns to town, and that's why we're
Speaker 2: spending a couple of plates today. You've been hearing on
Speaker 2: Bloomberg about a deal on top line spending levels that
Speaker 2: might help to avoid a government shutdown. They say, not
Speaker 2: those the same levels we agree to back in June.
Speaker 2: We'll get to that, along with talk of a border deal,
Speaker 2: potentially by the end of this week. And I know
Speaker 2: you've heard me say that before, but it's one week
Speaker 2: from Iowa, and that's where I want to start the
Speaker 2: conversation with Will Hurd. Of course, former Republican residential candidate.
Speaker 2: He's now behind Nicki Haley in the campaign, longtime a
Speaker 2: Texas congressman, former CIA officer, and can touch all of
Speaker 2: the stories that we're talking about here, from the campaign
Speaker 2: to the border to shut down politics.
Speaker 3: Congressman.
Speaker 2: It's good to see if welcome back voters actually are
Speaker 2: going to start having a say, a week from today,
Speaker 2: we're going to have more than just polls to talk about.
Speaker 2: And I wonder if it's a foregone conclusion that Donald
Speaker 2: Trump wins the Iowa caucuses.
Speaker 4: It's not a foregone conclusion. And Joe, I'm gonna start
Speaker 4: with Happy New Year. I'm still saying it. I appreciate
Speaker 4: and look, here's what we're going to see. You're seeing
Speaker 4: a number of town halls that are being done by
Speaker 4: Fox News this week. Donald Trump is actually finally participating
Speaker 4: in one. You're going to have a debate later this week,
Speaker 4: which is ultimately good to see Nicky Haley and Ronda
Speaker 4: Santis go head to head, and then we have voting
Speaker 4: a next Monday. People should also be paying attention to
Speaker 4: the weather because right now it's expected that weather in
Speaker 4: most parts of Iowa is going to be in the
Speaker 4: negative teens that's going to impact the number of people
Speaker 4: that come out for caucuses. So it's not a foregone
Speaker 4: conclusion that Donald Trump wins. You know, expect he thinks
Speaker 4: he's going to win by a large number. If he
Speaker 4: doesn't win by a big number, people are gonna be
Speaker 4: talking about his vulnerability. So a lot can happen still
Speaker 4: in seven days.
Speaker 3: Well, you just made a great point.
Speaker 2: Aside from the weather and we are bundling up for this,
Speaker 2: I'm actually a little bit scared.
Speaker 3: And that's a real deal.
Speaker 2: It's not just about those of us who are there
Speaker 2: from warmer clims. They'll be shivering in Des Moines. That
Speaker 2: could actually be a turnout story, and you can speak
Speaker 2: to that. But the way you just framed it is
Speaker 2: basically a question of by how much will Donald Trump win?
Speaker 2: In other words, a potential moral victory for someone who
Speaker 2: could come in second place in a strong showing as
Speaker 2: Nicki Haley that candidate.
Speaker 4: I think Nicki is absolutely that canids She's the only
Speaker 4: person that has been having momentum since the very beginning
Speaker 4: of this race. Actually, when you look at head to
Speaker 4: hair comparisons in a general election between her and Joe Biden,
Speaker 4: she's winning by double digits. Most people only focusing on
Speaker 4: the fact that Donald Trump may be up on Joe
Speaker 4: Biden by three or four points. Nicki Haley has consistently
Speaker 4: been up by double digits. So if Republicans want to
Speaker 4: see a absolute victory in November, Nicki Haley is the
Speaker 4: best choice. And that helps up and down the ballot.
Speaker 4: And when we look at the debates that are going
Speaker 4: on in Congress, you want to make sure there's really
Speaker 4: big coattails to keep the House in Republicans' hands. Right now,
Speaker 4: we're basically at a two Republicans only have a two
Speaker 4: seat majority that can potentially flip in November. Senate looks
Speaker 4: good for Republicans taking over. So if you want to
Speaker 4: see conservative leadership in Washington see and getting things done,
Speaker 4: I think Nicky has the best chance. That's the case
Speaker 4: she's been making throughout these early states.
Speaker 2: I'm going to throw this at you before I changed
Speaker 2: the topic to what's happening here in Washington, and would
Speaker 2: love your take on that as we spend time with
Speaker 2: Will Hurd. The Emerson poll out of South Carolina out
Speaker 2: Friday shows a tough go for Nicki Haley in her
Speaker 2: home state twenty five percent to Donald Trump's fifty four percent.
Speaker 2: There's been a lot of talk about some of the
Speaker 2: confusion surrounding her answer on what caused the Civil War? Recently,
Speaker 2: is that going to be a deficit for her in
Speaker 2: South Carolina and how important will that state be for
Speaker 2: her potential to move forward.
Speaker 3: She's made it.
Speaker 4: Very clear that the Civil War, the reason for the
Speaker 4: Civil War was slavery. She has talked about her mistake
Speaker 4: and not having that be the first thing that came
Speaker 4: out of her mouth. I think many of her opponents
Speaker 4: are using that in order to try to create drama
Speaker 4: and to stop that momentum that she's been seeing. But
Speaker 4: I think you're going to start seeing momentum continue to
Speaker 4: build in Iowa and New Hampshire as she goes into
Speaker 4: her home state that she knows incredibly well. And so
Speaker 4: you know, this is as you said at the top
Speaker 4: of this conversation, it's exciting that we're soon going to
Speaker 4: get to have to not worrying about what polls are
Speaker 4: saying and seeing what voters are actually saying, because I
Speaker 4: will I will say this, if you look at some
Speaker 4: of the polling versus votes of significant votes over the
Speaker 4: last let's call it nine months the abortion of ballot
Speaker 4: initiative in Iowa, the gubernatorial race in Kentucky. The polling
Speaker 4: did not reflect what actually happened at at the ballot box.
Speaker 4: And so this is going to come down to who
Speaker 4: has the best organized campaign and what when voters are
Speaker 4: finally thinking about what do we want? Do we want,
Speaker 4: you know, four more years of chaos, or do we
Speaker 4: want someone who's thoughtful, who understands foreign policy. Do we
Speaker 4: want an accountant in the White House so that we
Speaker 4: start actually getting our financial house and order.
Speaker 2: Well, I'll tell you the story here in Washington today
Speaker 2: is not so much about the presidential campaign who the
Speaker 2: next president will be, but whether we're going to have
Speaker 2: a government shut down in a couple of weeks. And
Speaker 2: I know that there's now an agreement on top line spending.
Speaker 2: It's the same agreement we had in the debt ceialing deal.
Speaker 2: So I have to admit I don't know if there's
Speaker 2: even much reason to talk about it, because it doesn't
Speaker 2: feel like progress. Jim Langford, though, says there is progress
Speaker 2: on the border. Will heard last time you were here,
Speaker 2: there was a hope that this might be done by
Speaker 2: the end of the year, and of course would help
Speaker 2: to unlock funding for Ukraine, but would bring a long
Speaker 2: sought compromise on border security and on immigration reform on
Speaker 2: asylum law. Are you as optimistic now as you were
Speaker 2: a couple of weeks ago here, because we're hearing from negotiators,
Speaker 2: including Langford, that there could be text by the end
Speaker 2: of this week.
Speaker 4: Langford is a serious guy, he's a thoughtful guy. He's
Speaker 4: not someone he's not going to say that if they're
Speaker 4: not close to some kind of deal. But we have
Speaker 4: to look at all this stuff together. If and I
Speaker 4: agree with you, the top line numbers is an agreement
Speaker 4: to agree to the last numbers, and that's going to
Speaker 4: require that's going to require the House to then you've
Speaker 4: got to actually write the bill that matches that number.
Speaker 4: And let's be frank, the conservatives in the House that
Speaker 4: are criticizing this again have never voted to fund the government,
Speaker 4: So the fact that there's going to be something that
Speaker 4: appeases them, it's just ridiculous. It's you know, can speak
Speaker 4: of Johnson, keep half of the get half the Republicans
Speaker 4: to vote for it, and are Democrats willing to participate?
Speaker 4: But you've got to be able to have a government
Speaker 4: open in order to get this side deal to deal
Speaker 4: with supplemental funding between Ukraine and the border. The border
Speaker 4: is continuing to be a crisis. I'm always going to
Speaker 4: be hopeful that something gets done because the communities along
Speaker 4: the border have been suffering for for five years. You know,
Speaker 4: we think about you know, most people only think, oh,
Speaker 4: you know, when New York and Chicago and la started complaining,
Speaker 4: that's when it really became a crisis. You know, it's
Speaker 4: been a crisis. It's been a crisis since the last
Speaker 4: year of Donald Trump's presidency. He's the one that began
Speaker 4: this problem, and then it just became considerably worse under
Speaker 4: President Byen. Last month, I think it was three hundred
Speaker 4: and twenty thousand people were apprehend and that's the all
Speaker 4: time high in the history of our government. So this
Speaker 4: is a this is a real.
Speaker 2: Seeing some staggering figures, that's for sure, And I wonder
Speaker 2: if you think it's a good time then to impeach
Speaker 2: the Homeland Security Secretary. The first hearing will take place
Speaker 2: in the House on Wednesday. Alejandro Majorcis, of course, is
Speaker 2: seated at the negotiating table. We're told at least helping
Speaker 2: to represent the administration. Is this the moment to pull
Speaker 2: the plug on the secretary?
Speaker 4: If I was president, by it, And let me be frank,
Speaker 4: I'm not one to generally give him advice to that's
Speaker 4: good for him. You know, if I'm Joe Biden, I
Speaker 4: would fire Secretary Mayorkis when you look at some of
Speaker 4: his bad pulling numbers, especially in a general election against
Speaker 4: general election voters. A significant amount of of the drag
Speaker 4: on Joe Biden is his is his bungling of the
Speaker 4: of the border crisis. And so this is you know,
Speaker 4: there's the there's a lot of Democrats that are frustrated
Speaker 4: with Secretary of Mariorchis and just look at the record.
Speaker 4: This is the worst the border crisis has been in
Speaker 4: our country's history. We've had over five million people come
Speaker 4: into our country illegally under Secretary of mayorcus of the
Speaker 4: data shows he's done a terrible job. And I am
Speaker 4: of the the opinion that this is they have not
Speaker 4: been actually implementing legislation appropriately. You do you know, we've
Speaker 4: made it very clear what asylum is supposed to be.
Speaker 4: They're having an incredibly generous definition of asylum, which is
Speaker 4: allowing these millions of people to come into the country,
Speaker 4: and to me, that alone is a violation of Secretary
Speaker 4: of may Orcus's duties.
Speaker 2: Well, it's looking like he may well lose his job.
Speaker 2: Will Hurd while you're with us, I have to get
Speaker 2: your insights quickly on the Secretary of Defense. And I
Speaker 2: ask you this as a former CIA officer, I'm guessing
Speaker 2: this is not a major kitchen table story right now.
Speaker 2: But he kind of went missing, having gone into Walter
Speaker 2: Reed for an elective surgery before Christmas. He was readmitted
Speaker 2: on New Year's Day, experiencing severe pain, and he is
Speaker 2: still there now. Apparently there was a breakdown in communication. Congressman,
Speaker 2: by that, I mean no one knew.
Speaker 3: He was there.
Speaker 2: They had to call the Deputy Secretary on the beach
Speaker 2: on vacation in Puerto Rico. This is something clearly that
Speaker 2: could have been planned and advanced. How important is this
Speaker 2: breach of protocol?
Speaker 4: Well, I think it comes to a lack of trust.
Speaker 4: And if you can't handle something this significant properly, how
Speaker 4: are you going to handle something that's moving fast. You
Speaker 4: know the fact that the Deputies Secretary had most of
Speaker 4: the authorities at that time for because of some other agreement,
Speaker 4: but the fact that Secretary Austin had not notified the
Speaker 4: president and the folks within the department, it makes no sense.
Speaker 4: And that now we're days later, we're still don't have
Speaker 4: the full story. This is a problem. I think everybody
Speaker 4: wishes him and hopes that he's healthy and safe and
Speaker 4: has a speedy recovery. But this is not how you
Speaker 4: handle the fact that are one of the most important
Speaker 4: people in our government has to go into the hospital.
Speaker 2: Will Heard, It's good to see you, former congressman, former
Speaker 2: Republican presidential candidate back with us on Bloomberg Radio. Come
Speaker 2: back and see us again soon. In fact, we'd love
Speaker 2: to talk once the voting does begin. I'd love to
Speaker 2: hear from the panel on this quickly, the matter of
Speaker 2: the Secretary of Defense. We're going to have a lot
Speaker 2: of time for the border and shut down politics coming up,
Speaker 2: but let's bring in Jeanie Shanzano and Rick Davis, Bloomberg
Speaker 2: Politics contributors. It's great to see you guys. Happy New Year.
Speaker 2: I missed you both.
Speaker 5: Rick.
Speaker 2: There are some folks who are, at least on the
Speaker 2: Republican side. I think the Defense secretary should be fired.
Speaker 2: Should there be accountability here.
Speaker 5: Yeah, absolutely, I mean, honestly, somebody needs to be fired.
Speaker 5: I mean, there's obviously a chain of commander exists, and
Speaker 5: there we go. And I think that if you know,
Speaker 5: the secretary was in communicato because of his health, it
Speaker 5: falls on others within the department to make sure that
Speaker 5: they're maintaining this level of transparency that's due a senior
Speaker 5: member of the cabinet like this. I mean, honestly, it's
Speaker 5: just outrageous. So yeah, I think a head should.
Speaker 3: Roll, A head should roll.
Speaker 2: Jeanie. The administration is speaking. John Kirby earlier today said
Speaker 2: Lloyd Austin stays in the job. Their concern right now
Speaker 2: is his health. Should we wait to learn more before
Speaker 2: we judge what happened.
Speaker 6: Yeah, I think we should all be concerned about his health.
Speaker 6: That we all can be. But the reality is is
Speaker 6: that this is about national security. And can you imagine
Speaker 6: the CEO of any company disappearing for a week. You know,
Speaker 6: there are twenty seven thousand or more people who work
Speaker 6: at the Pentagon, and their argument is that the woman
Speaker 6: who was supposed to inform the president was out sick.
Speaker 6: Something is amiss here. It is a problem that he
Speaker 6: is in line for the presidency. He has the nuclear codes.
Speaker 6: The president needs to lead and he needs to deal
Speaker 6: with this absolutely, the optics. The concern about his hospitalization
Speaker 6: is what's going on. We should all be concerned, But
Speaker 6: this is about national security while we're in an active
Speaker 6: war zone across the world, and so I do think
Speaker 6: the White House is going to have to address this.
Speaker 2: I mean, at least I called somebody when I was out.
Speaker 3: For a week. Genie, we'll have a lot more.
Speaker 2: With our panel, Rick Davis and Genie Shanzano as we
Speaker 2: pick their brains on a potential deal on the border
Speaker 2: and whether we're going to shut down by the way,
Speaker 2: a week away from Iowa a week from today, and
Speaker 2: Rick and Genie will be with us. We'll have more
Speaker 2: straight ahead on sound on This is Bloomberg.
Speaker 1: You're listening to the Bloomberg Sound on podcast. Catch the
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Speaker 2: Thirty, Big Screaming Headline Over the weekend, reporters called into
Speaker 2: bureaus to write the story of the grand deal that
Speaker 2: was put together here in Washington, d C. The House
Speaker 2: and Senate leaders Speaker Johnson Senator Chuck Schumer, and an
Speaker 2: agreement at last on top line spending levels, something that
Speaker 2: we've apparently been waiting for, even though they're the same
Speaker 2: levels we got back in June. I'm having a little
Speaker 2: bit of trouble with this one. As we remember the
Speaker 2: movie Gaslight from nineteen forty four was once Angels Street
Speaker 2: on stage, remember this, the husband trying to drive his
Speaker 2: wife insane. Things start to go missing, gas lights dim
Speaker 2: without being touched. And as I read here on the terminal,
Speaker 2: one point five nine trillion dollars the new top line
Speaker 2: negotiated here in Washington, DC, a cap on discretionary spending. Interesting,
Speaker 2: that's the same exact number that was in the debt
Speaker 2: ceiling deal back in June, the one that helped to
Speaker 2: get Kevin McCarthy fired. Yet here we are again talking
Speaker 2: about this as if it's news. It includes recisions, and
Speaker 2: this is what the Speaker says is new of unused
Speaker 2: COVID funding and cuts to the irs. They add up
Speaker 2: to about sixteen billion dollars, which is barely a rounding error.
Speaker 2: And so conservatives in the Freedom Caucus are not happy,
Speaker 2: and it's very difficult to tell whether we just improved
Speaker 2: our chances or not. This is happening at the same
Speaker 2: time as negotiating over the border takes place in Washington.
Speaker 2: As we reassemble the panel for their take, Brick Davis
Speaker 2: and Genie Shanzeno are here Bloomberg Politics contributors. Genie am
Speaker 2: I going crazy here. One point five to nine trillion.
Speaker 2: It's the same number we could have missed all that drama.
Speaker 2: If we just go back to June, we'd have the
Speaker 2: same deal we have now, right.
Speaker 6: That's right, it's like deja vu all over again. And
Speaker 6: you mentioned gas lighting, and I was thinking of another film,
Speaker 6: But you know, the reality is is that this is
Speaker 6: pretty much all that Johnson could get. And the real
Speaker 6: question is where you ended Is he going to be
Speaker 6: able to keep his job in the aftermath. It really
Speaker 6: almost doesn't matter what Chip Roy and the Conservatives say
Speaker 6: on this. They're going to push him to the right
Speaker 6: as much as possible, but the reality is he's going
Speaker 6: to need Democrats to get this passed and you know,
Speaker 6: one question to keep in mind is are they going
Speaker 6: to push him enough so that he tries to include
Speaker 6: things involving abortion or LGBTQ rights which will really create
Speaker 6: enough work and have him lose some needed Democrats. So
Speaker 6: that's what we're talking about here. Otherwise, this is pretty
Speaker 6: much what McCarthy negotiated and what eventually he Brinnick Ghannon
Speaker 6: got him fired.
Speaker 3: Wow.
Speaker 2: Freedom Caucus calls it a total failure.
Speaker 3: Rick.
Speaker 2: I could go through all of the individuals here, from
Speaker 2: Chip Roy to Andy Biggs, but I think you get
Speaker 2: the point. Is the speaker gaslighting us. How do we
Speaker 2: call this a new deal?
Speaker 7: Yeah, it's a.
Speaker 8: Joke, is what it is.
Speaker 5: I mean, he's his strategy has taken us full circle
Speaker 5: to exactly as you said, right back to the very beginning.
Speaker 5: It sounds like a bad Sound of Music episode. And
Speaker 5: so like the bottom line is that now they found
Speaker 5: a new problem. You know, the same guy's Gats, Biggs, Rosendale,
Speaker 5: all these guys who you know, threw out McCarthy as
Speaker 5: speaker over the budget deal have now said now the
Speaker 5: budget deal is less problematic than the fact that we
Speaker 5: need to have HR two embedded in the budget deal.
Speaker 5: The House's big border security plan. So you can keep
Speaker 5: the number, but you got to have border security in
Speaker 5: there too, And I just think they keep moving the goalpost.
Speaker 5: It doesn't help the Speaker. I doubt if he's going
Speaker 5: to lose his job over this. But as Genie said,
Speaker 5: there's not going to get anything done unless they have
Speaker 5: Democratic votes. And if they have Democratic votes, none of
Speaker 5: these people's voices matter.
Speaker 2: So not only has nothing changed since before the holidays,
Speaker 2: but not since last June. Just a different guy holding
Speaker 2: the gavel here. The border you mentioned Rick may well
Speaker 2: be intertwined here. In fact, they're talking about potentially moving
Speaker 2: all of this as one piece if a border deal
Speaker 2: can be reached in the Senate. Now I realize the
Speaker 2: speaker's talking about negotiating directly with the White House now
Speaker 2: because a Senate deal may not fly in the House.
Speaker 2: This is the latest though from James Langford, the Senator,
Speaker 2: the Republican Senator at the negotiating table. He was on
Speaker 2: Fox News Sunday.
Speaker 9: Tex Hopefully this week to be able to get that out.
Speaker 9: Everybody will have time to be able to read and
Speaker 9: go through it. No one's going to be jammed in
Speaker 9: this problem. But it's a matter of trying to be
Speaker 9: able to get this out. But to make law, we've
Speaker 9: got to have a Democrat Senate, a Democrat White House,
Speaker 9: and a Republican House to be able to go through this.
Speaker 9: So this agreement has to work. Everyone's counting on this
Speaker 9: actually working. But it's going to have to be agreement
Speaker 9: that a White House that is a Democrat White House
Speaker 9: and a Democrat Senate can also line up with a
Speaker 9: Republican House. And we're working the thread that needle for
Speaker 9: things that actually work, all.
Speaker 2: Right, Genie, He says text could emerge by the end
Speaker 2: of this week. That would mean they're pretty darn closed.
Speaker 2: It would also be a day or two after the
Speaker 2: first impeachment hearing for Alejandro majorcis, how's this all going
Speaker 2: to come together since he's involved in these negotiating sessions.
Speaker 6: Yeah, that's right, And you asked Representative Hurt the right
Speaker 6: question about is this really the time to impeach the
Speaker 6: Secretary of Homeland Security? Not to mention, you know, I'm
Speaker 6: trying to just figure that when Johnson goes over to
Speaker 6: the White House to negotiate with the President, this will
Speaker 6: be just before or after they vote on mayorcis, they
Speaker 6: decide to hold his son in contempt, and oh, by
Speaker 6: the way, they decide potentially on impeaching him, because those
Speaker 6: are the kind of things that the Conservatives are going
Speaker 6: to push Johnson to do to save his job. You
Speaker 6: couple that with the calendar the coming twenty four election
Speaker 6: and the votes there, and the fact that Donald Trump
Speaker 6: has been out on the stump making big hay out
Speaker 6: of the issue of immigration. So I go back to
Speaker 6: the reality that I cannot see a world in which
Speaker 6: Republicans allow Joe Biden and the Democrats to get a
Speaker 6: deal on immigration. As much as Langford is negotiating in
Speaker 6: good faith, I don't see how they allow this to happen.
Speaker 6: And twenty four is going to be looming over all
Speaker 6: of this.
Speaker 2: What do you think about that, Rick, Because we know
Speaker 2: the border is not playing well for Joe Biden. Now,
Speaker 2: and this new CBS News you Gov poll underscores that
Speaker 2: sixty eight percent disapprove of the President's handling of the border.
Speaker 2: Sixty three percent think you should be tougher on the border.
Speaker 2: That's the backdrop for this conversation. Donald Trump and well,
Speaker 2: I guess Mike Johnson both know that this would probably
Speaker 2: help Joe Biden if they got a deal.
Speaker 3: Yeah.
Speaker 5: I think that the reality is Republicans have to at
Speaker 5: some point do something proactive on the border. They can't
Speaker 5: just throw up poison pill legislation that doesn't go anywhere.
Speaker 5: Republican constituents, voters care about this, and they both care
Speaker 5: about different things. I mean, we've got to remember that
Speaker 5: the voters for the Democrats, voters for Biden, they want
Speaker 5: a more efficient process. They want the border more secure,
Speaker 5: and Republicans want more border security and then a more
Speaker 5: efficient process. So they have a totally different point of
Speaker 5: view on what is success. Both are under some level
Speaker 5: of pressure to make progress. As as you know, Congressman
Speaker 5: former Congressman Will Hurd said, you can't have a year
Speaker 5: where you have, you know, hundreds of thousands a month
Speaker 5: of hundreds of thousands of illegal migrants crossing the border
Speaker 5: and not take a hit. If you're a Republican or
Speaker 5: a Democrat.
Speaker 2: You think we're going to shut down, I'll ask you both, Rick,
Speaker 2: and we're looking at two different dates. I'll remind everybody.
Speaker 2: One is late this month. The second is early February.
Speaker 2: There are only what eight legislative days to figure this out.
Speaker 3: How's this going to happen?
Speaker 5: You know, Look, you've got a half a dozen approached bills.
Speaker 5: You ought to be able to get those done on
Speaker 5: the House side in the first series of administration budget
Speaker 5: deals and on suspension you could pass at with Democrats
Speaker 5: and Republicans together, no brainer. Now as long as there
Speaker 5: are no poison pills in those bills. So right now,
Speaker 5: if the Republicans want to sabotage the system, they put
Speaker 5: poison pills in there and have to force the Democrats
Speaker 5: in the Senate to rewrite everything.
Speaker 2: That is important. Genie, the Speaker could still go there
Speaker 2: if he wanted to.
Speaker 3: Do you think we're heading for a shutdown?
Speaker 6: I hope not. I don't think so. It's not in
Speaker 6: anybody's interest to shut down. Rick just mentioned the poison
Speaker 6: pills are the big thing to watch, especially on abortion
Speaker 6: in LGBTQ rights. That would be devastating to the bill.
Speaker 6: And by the way, the calendar is tough, as you mentioned,
Speaker 6: eight days to that first deadline. That's tough in normal circumstances.
Speaker 3: But how about it.
Speaker 2: Little New Year's optimism from Rick Davis Genie Shanzano, both
Speaker 2: agreeing there will be no shutdown, and of course we're
Speaker 2: going to be thinking about this conversation when we walk
Speaker 2: up to those dates, realizing it'll be kind of a
Speaker 2: partial shutdown and then a whole shutdown in February, and
Speaker 2: all this is going to coincide with what's happening in Iowa.
Speaker 2: Can you imagine after Donald Trump spends this week in
Speaker 2: courtrooms across the country, actual voting, actual caucusing will take
Speaker 2: place next Monday.
Speaker 1: You're listening to the Bloomberg Sound On podcast. Catch us
Speaker 1: live weekdays at one Eastern on Bloomberg dot com, the
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Speaker 2: Welcome to our two Bloomberg Sound On. I'm Joe Matthew
Speaker 2: in Washington, joined by Kaylee Lines.
Speaker 3: It's good to see you, Kayley.
Speaker 2: It sounds weird, although Will Hurd told me it was
Speaker 2: not too late to be saying Happy New Year. So
Speaker 2: I'm gonna say happy New Year to you because I
Speaker 2: haven't released well, I haven't.
Speaker 3: Seen you first.
Speaker 10: That's fair, Happy New Year, Joe.
Speaker 2: But I am struggling with that a little bit. You know,
Speaker 2: you go to the gas pump here at the store.
Speaker 3: Do you do the have or are we be I
Speaker 3: think you have.
Speaker 10: One week, so we're beyond that, and I think we're beyond.
Speaker 10: But I appreciate the well wishes for my year. It's
Speaker 10: going to be a doozy Joe. You and I both
Speaker 10: know it.
Speaker 2: Yeah, we're about to go through a lot, and you
Speaker 2: know it. Really we start spinning the plates now. Senate's
Speaker 2: getting back to town today, house tomorrow. People called in
Speaker 2: to work over the weekend because there's a deal on
Speaker 2: top line spending levels. And I find this really funny.
Speaker 2: I did a whole thing last hour on gas lighting
Speaker 2: and the movie gas Light in nineteen forty four.
Speaker 3: That feels like as.
Speaker 2: The gas lights were dimming without anyone touching them, and
Speaker 2: this woman was driven crazy by her husband who was
Speaker 2: moving things in the night.
Speaker 3: That's what's going on here. Now.
Speaker 2: I'm glad we have Jack Fitzpatrick because maybe he can
Speaker 2: pull me in off the ledge. But they agreed to
Speaker 2: one point five to nine trillion dollars, I believe correct,
Speaker 2: which is exactly the same thing they agreed on last
Speaker 2: June when Kevin McCarthy was speaking right, same fiscal.
Speaker 10: Year, Yeah, same seven hundred and seventy three billion dollars
Speaker 10: non defense discretionaryes.
Speaker 4: Friending a side deal.
Speaker 10: Well there's that too.
Speaker 2: Yes, they cutified the side deal, so it's exactly the
Speaker 2: same plan that we had last June.
Speaker 10: But Mike Johnson would tell you they got sixteen billion
Speaker 10: dollars in savings from those of the forward that irs
Speaker 10: funding cut of ten billion dollars, and then we're sending
Speaker 10: the six billion in COVID relief money.
Speaker 3: Yes, I don't think that's a real big difference. That's
Speaker 3: a rounding error, is what that is.
Speaker 2: But that's why we have Jack to help us exactly
Speaker 2: who held forth I understand like a hero and a
Speaker 2: captain in the chair last week. Great to see you, Jack,
Speaker 2: I say, happy New Year.
Speaker 3: We're in it? Is it just me?
Speaker 2: Or are we playing games with the same numbers here?
Speaker 11: It is a reagreement more than anything else.
Speaker 1: I like that.
Speaker 11: I mean, you said rother than before, and they've been
Speaker 11: arguing for months over things you could probably call a
Speaker 11: rounding error. The side deal is a little shy of
Speaker 11: seventy billion dollars in extra spending. I mean, the government
Speaker 11: is going to spend. It's hard to even keep track
Speaker 11: what we're going into four or five to six trillion.
Speaker 11: This is all the discretionary numbers is at one point
Speaker 11: five to nine trillion versus one point sixty five trillion.
Speaker 11: They've been arguing and risking shutdowns and slinging mud over
Speaker 11: a relatively small pot of money in the grand scheme
Speaker 11: of things. But that is what the argument has been
Speaker 11: since June or so, and now they have re agreed
Speaker 11: to basically the same numbers more or less as they
Speaker 11: struck in late May early June.
Speaker 10: Okay, so maybe we're calling this a win, even though
Speaker 10: I'm not really sure it should be a win. But
Speaker 10: the idea is just helps take a step at least
Speaker 10: toward averting a shutdown. The thing is, top line figures
Speaker 10: are one thing. Then you have to divvy that up,
Speaker 10: turn that into legislative text, and get that past both
Speaker 10: chambers before actually January nineteenth and funding runs out. So
Speaker 10: how much of the hard work is still ahead When
Speaker 10: it was this hard to agree to the deal that
Speaker 10: was already agreed with you in the first place.
Speaker 11: This was probably the hardest question for them to answer,
Speaker 11: and they answered it, and that's good, But there are
Speaker 11: still very hard questions to answer. It's probably debatable really
Speaker 11: whether this was the hardest. They are still going to
Speaker 11: have fights over policy riders. How much do you want
Speaker 11: to get into the tough policy measures, not just dollars
Speaker 11: and how much you're going to spend. But the big
Speaker 11: ones over the past year have been abortion access being
Speaker 11: legislated through some of these spending bills. The FBI. There
Speaker 11: are conservatives who are hesitant to fund the FBI without
Speaker 11: policy right, there's resentment over the FBI visa v. Donald
Speaker 11: Trump's legal troubles. There is not an agreement now on
Speaker 11: how they are going to broadly approach policy riders. So
Speaker 11: any policy measure they could fight over, they can still
Speaker 11: fight over it. Also, as you mentioned, they agreed to
Speaker 11: a defense and non defense number. They didn't divvy that
Speaker 11: up into the twelve appropriations bills. How do they divide
Speaker 11: that up for an allocation for each of those bills,
Speaker 11: which has an effect on what kind of programs get
Speaker 11: more money and less money. That's something that they still
Speaker 11: have to do, and it's not a lot of time
Speaker 11: until January nineteenth, so there are still plenty of hurdles
Speaker 11: for them.
Speaker 3: Man, but possible. You're not covering a shutdown this time.
Speaker 11: It's very good news. Yesterday's news was a big broad.
Speaker 3: Well, this is encouraging, Kaylee.
Speaker 2: I'm a naysayer. I'm accusing people of gaslighting. Jack, who
Speaker 2: does this for a living, is encouraged.
Speaker 10: Okay, Well take Jack's word for it.
Speaker 2: Absolutely great to see it. Jack Fitzpatrick, don't be a stranger.
Speaker 2: I know you won't be. I'm wondering what Nick has
Speaker 2: to think and has to say about all of this,
Speaker 2: because we have eight legislative days. I haven't even brought
Speaker 2: up the boarder yet. By the way, eight legislative days.
Speaker 2: Remembering though, we have two dates, so we do a
Speaker 2: little shutdown for a couple of days after the first
Speaker 2: one and get it done potentially by February second. Mick mulvaney,
Speaker 2: of course, co founder of the Freedom Caucus and a
Speaker 2: former acting Chief of Staff in the White House, former
Speaker 2: budget director. I'm just gonna say happy New Year, because
Speaker 2: I started all of this and I'm just coming back today. Mick,
Speaker 2: it's great to see you. Does this sound like a.
Speaker 3: Shutdown that can be averted?
Speaker 8: Sure?
Speaker 7: Does it sound like shutdown has been averted?
Speaker 8: No, I'm not really sure. I was sitting here, I
Speaker 8: was in Louisiana yesterday for the swearing in of Jeff Landry,
Speaker 8: Republican governor, who's also a Tea Party member, class of
Speaker 8: twenty ten. So sort of old home week. But a
Speaker 8: couple of those folks are still in Congress, and they
Speaker 8: were all scratching their head as to where Mike Johnson
Speaker 8: got the one point sixty six trillion dollar deal.
Speaker 7: Keep it with mind. Mike Johnson was also there yesterday
Speaker 7: because he's from.
Speaker 8: Louisiana as well, so I'm not sure. I'm looking at
Speaker 8: Chip Roy's page here today and he says, Look, it
Speaker 8: all depends on the policy deals we can get as
Speaker 8: part of this spending deal. I cannot imagine what policy
Speaker 8: deals they are going to get. It seems to me,
Speaker 8: if you're going to avoid a shutdown, it's going to
Speaker 8: follow the same exact model that it has for the
Speaker 8: last decade, which is all the Democrats will vote for it,
Speaker 8: a couple of Republicans will vote for it, the Republicans
Speaker 8: will start.
Speaker 7: An internal blood bath over it.
Speaker 8: So if that's if that's what you if that's what
Speaker 8: a shutdown means, I think that's what you've got.
Speaker 10: Okay, So you are envisioning an internal bloodbath here, Mick.
Speaker 10: Not exactly a pretty picture you're painting, But for Mike
Speaker 10: Johnson specifically knowing the fate of his predecessor, Kevin McCarthy,
Speaker 10: who passed a deal with Democratic support and lost the
Speaker 10: gavel as a result, do you really think he's staring
Speaker 10: down that same threat? Can House Conservative stomach another speaker fight?
Speaker 8: You know, if they were rationally answer that question will
Speaker 8: be no. But I don't think Matt Gates is a
Speaker 8: rational act. And all of this, I'm not sure how
Speaker 8: if they really made the case that they got rid
Speaker 8: of McCarthy because of policy shortcomings, that he was incapable
Speaker 8: of cutting a good deal with Democrats with the White House,
Speaker 8: and then it wasn't about something personal between Matt and McCarthy.
Speaker 7: You know, Matt always said it was about policy.
Speaker 8: If it really was about policy, it strikes me that
Speaker 8: the same policy they got McCarthy fired just got it
Speaker 8: agreed to again. So I'm not really sure what the
Speaker 8: argument is not to do anything different than what they
Speaker 8: did to Kevin.
Speaker 3: Well, that's interesting.
Speaker 2: The Freedom Caucus calls it a total fail, suggesting that
Speaker 2: it's clear that Mike Johnson Mick will need Democrats to
Speaker 2: pass this. So now we really have created the same
Speaker 2: exact scenario in which Kevin McCarthy got fired. But that
Speaker 2: was before we went through Stevescalise and Tom Emmer and
Speaker 2: Jim Jordan. I don't mean to ask the same question
Speaker 2: that Kayley just asked, But who else is there?
Speaker 7: There isn't anybody.
Speaker 8: But of course that's not again, that's that's a rational
Speaker 8: question to ask about this. If you're simply trying to
Speaker 8: stop this from happening, which a couple of folks probably
Speaker 8: would be interested in doing, then trying to get rid
Speaker 8: of this speaker throws a monkey wrench.
Speaker 7: Into the whole thing.
Speaker 8: The question the conservatives are gonna be asking is how
Speaker 8: was this different. Mike Johnson has got to be able
Speaker 8: to go to them with something and say, look, here's
Speaker 8: why you should keep me. I've just cut a deal
Speaker 8: that does X, Y and Z, and that is better
Speaker 8: than the deal you would have gotten under Kevin McCarthy,
Speaker 8: and that's why I should stay. I don't know what
Speaker 8: that deal is yet, because the number is bigger. I mean,
Speaker 8: the number is actually bigger than they agreed to. I
Speaker 8: think it one five nine, and now it's one six
Speaker 8: six of course, that side deal I thought was supposed
Speaker 8: to be just a handstake and a secret It wasn't
Speaker 8: anything that the House voted on. So technically, I guess
Speaker 8: you could make the case that Mike Johnson is spending
Speaker 8: more not the same, if you want to say that
Speaker 8: the side agreement technically wasn't agreement because the McCarthy and
Speaker 8: Schumer don't have the ability to cut those types of deals.
Speaker 8: So it's really ugly. I hear what everybody's saying. It
Speaker 8: sounds like it's certainly a move in the right direction
Speaker 8: towards the abarding a shutdown. I'm not sure it's I'm
Speaker 8: not sure it's anywhere near the end of the discussion.
Speaker 10: Well, and Mick, doesn't it all hinge on the border anyway?
Speaker 10: When you have members of the Republican Conference saying HR
Speaker 10: two or bust, no security, no funding, shut down, the border,
Speaker 10: shut down the government, it seems that everything is about
Speaker 10: the border here.
Speaker 7: It could be.
Speaker 8: Now you could also make the argument, I think you
Speaker 8: could make it plausibly that well, they always want to
Speaker 8: talk about the border. They sort of are some other
Speaker 8: Republicans now they sort of have at least tacitly if
Speaker 8: nothing else given into this concept of mirroring the border
Speaker 8: discussions up with funding for Ukraine, Israel, to a lesser extent, Taiwan.
Speaker 7: Right that.
Speaker 8: Those four pieces seem to be stuck together. Yes, they
Speaker 8: would love to have a second bite at the apple.
Speaker 8: I just don't know how they do it. If you say, well,
Speaker 8: we have to have HR two in order to pass
Speaker 8: anything out of the House, then nothing will pass out
Speaker 8: of House because the Senate will never pass HR two.
Speaker 8: So I hear what you're saying, But I think that
Speaker 8: maybe the spending deal will be isolated from at least
Speaker 8: the discussion a by HR two because that has sort
Speaker 8: of been married now to Ukraine and Israel.
Speaker 2: To what extent is Donald Trump helping to direct the
Speaker 2: conversation here, Mick. Last time we spoke, it was shortly
Speaker 2: after we learned that Mike Johnson was in regular contact
Speaker 2: with him. We heard him talk about the boarder quite
Speaker 2: a bit over the weekend in Iowa. Do we at
Speaker 2: this point really think that he's going to endorse any
Speaker 2: deal that might make Joe Biden or any Democrat look good.
Speaker 8: No, And I think that's one of the reasons you
Speaker 8: hear him. I haven't seen anything out of him today
Speaker 8: about the spending deal. I think he's waiting to see
Speaker 8: how it's received. When it's received badly by a Conservatives,
Speaker 8: he's going to attack it. He might also wait to
Speaker 8: see what Nikki Haley and Ron Desantus are saying about it,
Speaker 8: but I guess is they'll attack it as well.
Speaker 7: So no, I don't think Trump is interested. That's that's
Speaker 7: not unusual in politics. Right.
Speaker 8: There's a couple House members over the weekend who said
Speaker 8: they weren't interested in doing a board deal now because
Speaker 8: it would give Biden the victory too close to the
Speaker 8: to the election.
Speaker 7: That that's not unusual.
Speaker 8: I dealt with the same thing with Democrats when I
Speaker 8: was in the White House in twenty nineteen, in early
Speaker 8: twenty twenty. They didn't want to give Trump and he wins,
Speaker 8: you know, that close to election. So that's that's certainly
Speaker 8: the politics as usual. But no, I don't think Donald
Speaker 8: Trump is interested in brokering a deal here. You know,
Speaker 8: when he was running for office the first time, he was,
Speaker 8: you know, against all the spending deals. When he was
Speaker 8: in office, he was for all the spending deals. When
Speaker 8: he was out of office, he was against the spending deals.
Speaker 7: Again, so I think you can continue to see that trend.
Speaker 10: Well, Mick, you just mentioned there Nicki Haley and Ron DeSantis.
Speaker 10: Keeping in mind that you're speaking with us exactly one
Speaker 10: week out from the Iowa caucuses. Do either of them
Speaker 10: stand a real chance?
Speaker 8: If there was, if I was looking for an upset Kaylee,
Speaker 8: it would be in DeSantis.
Speaker 7: I don't think any of them. I don't think Nicky
Speaker 7: Oron has a chance to beat Trump.
Speaker 8: But if you look to folks who overperform versus underperform,
Speaker 8: keep in mind Donald Trump underperformed badly in two thousand
Speaker 8: and sixteen, I think it was twelve points or something
Speaker 8: like that, and Ted Cruz overperformed by about the same amount,
Speaker 8: in large part because Cruz understood how caucuses were different
Speaker 8: than primaries, and Trump, at that time, a first time candidate,
Speaker 8: really didn't. Now Trump is working really, really hard to
Speaker 8: make sure that mistake doesn't happen again in twenty twenty four.
Speaker 8: But that being said, a lot of Cruz's team has
Speaker 8: signed on with DeSantis. So if there's a chance for
Speaker 8: anybody to overperform next Monday, I'll be looking for Ron
Speaker 8: to overperform. If he doesn't, and he finishes third, then
Speaker 8: I think he's out of the race. I think you
Speaker 8: have to finish second in Iowa to move on to
Speaker 8: Super Tuesday. It looks like he's not going to finish
Speaker 8: second in New Hampshire. I may excuse me. He may
Speaker 8: finish fourth in New Hampshire or fifth. So but I
Speaker 8: will watch to see if DeSantis overperforms. I don't think
Speaker 8: he's got a chance to beat Trump, but he may
Speaker 8: do better beter than the polling is showing.
Speaker 3: Well.
Speaker 2: Just in our last minute here, Mick, I wonder your
Speaker 2: thoughts on your home state South Carolina. Emerson has Trump
Speaker 2: at fifty four, Hayley at twenty five. If she can't
Speaker 2: outperform a number like that in her home state, is
Speaker 2: it over?
Speaker 8: Oh, Joe, I've been waiting for somebody asking that question.
Speaker 8: Everybody alays wants to talk about Iowa in New Hampshire
Speaker 8: and everyone and then folks realize that South Carolina comes next,
Speaker 8: and the dirty little secret down here is that, Yeah.
Speaker 7: Trump is going to crush her.
Speaker 8: She's done really really well the last couple of months,
Speaker 8: and I do think she's got a chance to pull
Speaker 8: within maybe single digits in New Hampshire.
Speaker 7: She's done. Had a nice effort there, But South Carolina's
Speaker 7: Trump state. South Carolina is Trump country.
Speaker 3: One percent.
Speaker 7: Trump is winning the state.
Speaker 2: I guess I shouldn't be surprised to hear that, but
Speaker 2: it's always news when we hear it from Mick maulvaney.
Speaker 2: It's good to see him, Mac. Thank you for the insights.
Speaker 2: As always, Mick mulvaney on sound On. We do this
Speaker 2: conversation each Monday, myself and Kayley with Mick, and we'll
Speaker 2: do it again when we head to Iowa. This is Bloomberg.
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