WEBVTT - Surveillance: Trump’s Legacy & Biden's Agenda 0:00:09.880 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene. Daily 0:00:13.960 --> 0:00:17.560 we bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.520 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:27.800 Bloomberg dot Com, and of course on the Bloomberg. Right now, 0:00:28.040 --> 0:00:31.200 Greg Vlli joins us with a f G O. Note 0:00:31.240 --> 0:00:35.240 that everybody in Washington reads each and every morning, and Greg, 0:00:35.280 --> 0:00:37.840 I do want to talk about something we've really avoided 0:00:37.840 --> 0:00:41.000 this morning is John Farrell mentions we get right to 0:00:41.080 --> 0:00:45.280 work and part of that work is impeachment. What will 0:00:45.320 --> 0:00:51.280 we see this Wednesday and Thursday on impeachment? Yeah, Hi, Tom, 0:00:51.320 --> 0:00:54.240 good morning. Everybody talks about unity, and I know it's 0:00:54.240 --> 0:00:56.480 going to be a big fame for Joe Biden, but 0:00:56.600 --> 0:00:58.800 we have a decent trial coming up that I think 0:00:58.800 --> 0:01:00.920 will be better at think it will drag on for 0:01:00.960 --> 0:01:03.400 two or three weeks. I think they probably will fail. 0:01:04.000 --> 0:01:06.640 I think it could make uh Donald Trump look like 0:01:06.680 --> 0:01:09.640 a martyr. I think it will complicate Joe Biden's agenda. 0:01:10.120 --> 0:01:13.039 So right away after talking about unity, week of that, 0:01:13.760 --> 0:01:16.759 and I would just also add to the Janet yell 0:01:16.840 --> 0:01:20.639 and hearing yesterday was not that unified. The Republicans pushed 0:01:20.640 --> 0:01:23.720 back hard on new spending. Yeah, well, that's exactly where 0:01:23.720 --> 0:01:25.959 I wanted to go, this idea that we talk about unity, 0:01:26.000 --> 0:01:28.720 and yet we have these divisions that are getting just deeper. 0:01:29.160 --> 0:01:32.119 Do you feel momentum behind this one point nine trillion 0:01:32.160 --> 0:01:33.560 dollar plan or do you think this is going to 0:01:33.720 --> 0:01:36.280 drag out for months, far longer than the market is 0:01:36.319 --> 0:01:39.920 pricing in. I think there's momentum behind a plan. I'm 0:01:39.959 --> 0:01:42.360 not sure if this plan that has a lot of 0:01:42.360 --> 0:01:45.479 money for state and local governments, minimum wage. I think 0:01:45.520 --> 0:01:47.680 we'll get something, but I don't think it will be 0:01:47.720 --> 0:01:50.080 one point nine trillion. I think we could get a 0:01:50.120 --> 0:01:53.320 deal by the end of February, but the Republicans really 0:01:53.360 --> 0:01:57.440 showed their hand yesterday that they don't want anything that's expensive. 0:01:59.240 --> 0:02:01.160 One point nine audience, the number, What do you think 0:02:01.160 --> 0:02:04.120 it comes down to? Greg, Well, I've been saying something 0:02:04.120 --> 0:02:07.120 around one five. I think maybe one four one five. 0:02:07.480 --> 0:02:11.760 I think that is is doable. The Democrats have to 0:02:11.800 --> 0:02:15.080 hold on to every one of their fifty senators, and 0:02:15.120 --> 0:02:18.240 I'm not convinced John that they've got all fifty. They 0:02:18.320 --> 0:02:21.320 might have forty eight, they might have forty nine. So 0:02:21.400 --> 0:02:25.240 that this will I think boiled out to negotiations between 0:02:25.320 --> 0:02:28.560 Joe Biden and Mitch McConnell. Great Valier with us with 0:02:28.639 --> 0:02:31.040 the GF, and he will stay with us at this moment, Greg, 0:02:31.120 --> 0:02:33.040 val so much of this And we just talked to 0:02:33.080 --> 0:02:37.800 with there's the post poster for conservative Republicans. Is Republicans 0:02:38.160 --> 0:02:42.720 acting fast to get ready for two thousand twenty two primaries? 0:02:43.040 --> 0:02:48.359 What would you expect to see from conservative southern Republicans? Well, 0:02:48.400 --> 0:02:51.160 it is amazing, isn't a ton that we're already talking 0:02:51.200 --> 0:02:54.160 about twenty twenty two? But that's Washington. So a couple 0:02:54.200 --> 0:02:56.639 of points I'd make. Number one, I do think that 0:02:56.680 --> 0:02:59.600 the Republicans will hit hard on the issue of taxes 0:02:59.639 --> 0:03:03.240 and ending. I think the country doesn't want big new taxes. 0:03:03.320 --> 0:03:06.480 I think that's going to be a potent argument for them. 0:03:07.200 --> 0:03:09.920 So I think that the other point I'd make is 0:03:10.000 --> 0:03:13.959 that historically a first term president in his first midterm 0:03:13.960 --> 0:03:18.240 election loses about five of House and Senate seats. If 0:03:18.240 --> 0:03:20.799 Biden were to lose five percent of House and Senate seats, 0:03:20.919 --> 0:03:24.960 he'd lose both houses. Greg, I want you to talk 0:03:25.080 --> 0:03:30.800 about the silence of Mr Hoover and Mr Roosevelt long 0:03:30.840 --> 0:03:33.720 ago and far away in the early days of the depression. 0:03:34.000 --> 0:03:37.360 Without question, the quietest car ride in the history of 0:03:37.360 --> 0:03:41.640 our presidents. With all your perspective, Greg Bellier, is Mr 0:03:41.680 --> 0:03:44.600 Trump setting precedents here that we may see in the 0:03:44.640 --> 0:03:48.000 future or in your opinion, is this a one off 0:03:48.320 --> 0:03:51.280 of discord. I think it's a one off. I think 0:03:51.400 --> 0:03:56.200 most politicians right or left respect tradition. You know, Trump doesn't. 0:03:56.200 --> 0:03:58.360 He stirred the pot. I mean, that's Donald Trump. He 0:03:58.400 --> 0:04:01.640 didn't respect a lot of the norms. But I think 0:04:01.800 --> 0:04:05.440 as we go into other elections that there will be 0:04:05.560 --> 0:04:12.080 more conciliation. Greg. When we talk about the presidency of Trump, 0:04:12.280 --> 0:04:16.120 it was one that was anti establishment, it was anti Washington. 0:04:16.200 --> 0:04:19.000 That was the goal of his taking out some of 0:04:19.040 --> 0:04:23.039 the career members of the cabinet, of the various departments 0:04:23.200 --> 0:04:26.080 and putting in his own people. What do you think 0:04:26.080 --> 0:04:28.760 the legacy of that will be as Joe Biden comes 0:04:28.760 --> 0:04:31.599 in and tries to reverse that. Well, you know, it's 0:04:31.640 --> 0:04:34.240 one thing to blow things up. I get it that 0:04:34.520 --> 0:04:37.039 there are certain institutions that haven't worked well and you 0:04:37.080 --> 0:04:38.800 want to blow them up, but you have to have 0:04:39.279 --> 0:04:42.200 something to replace them with. And he would blow things 0:04:42.279 --> 0:04:46.440 up without any alternative, and I think that got tires up. 0:04:46.600 --> 0:04:50.760 I also think the level of personal rancorps, the vindictiveness, 0:04:50.839 --> 0:04:55.239 the ugliness of his tweets really distinguished him and really 0:04:55.279 --> 0:04:58.640 diminished his cause. John, I think the British do this better. 0:04:58.680 --> 0:05:00.440 You lose the election, what do you are you leave 0:05:00.480 --> 0:05:05.719 in like three hours with the cardboard the next day. 0:05:05.720 --> 0:05:07.600 And I do think the events in the last few 0:05:07.640 --> 0:05:11.920 months Tom really exposed some vulnerability in that process. The process, 0:05:11.960 --> 0:05:15.039 of course established for good reason many years ago. But 0:05:15.080 --> 0:05:17.599 I wonder, Greg, just as a final question to you, sir, 0:05:17.720 --> 0:05:21.400 whether that's something that people will rethink, will need to rethink, 0:05:21.400 --> 0:05:25.240 whether you think we should rethink that well. I think 0:05:25.240 --> 0:05:28.680 there were things that Trump did that were positive. Getting 0:05:28.680 --> 0:05:32.039 tough with China I think everybody would agree on. I 0:05:32.120 --> 0:05:35.919 think having fewer regulations people would agree on. It was 0:05:35.960 --> 0:05:38.000 the way he did it. The way he did it 0:05:38.080 --> 0:05:41.000 was was so over the top and outrageous that it 0:05:41.120 --> 0:05:44.440 hurt his cause. Greg Bella, thank you so much for 0:05:44.520 --> 0:05:46.840 joining us on the day of inauguration, and all of 0:05:46.920 --> 0:05:51.360 us thank you for your perspective across this historic campaign. 0:05:55.920 --> 0:05:59.440 Right now, with futures up seventeen and futures up sixty. 0:06:00.560 --> 0:06:04.000 It is a market that is voting on prosperity for 0:06:04.080 --> 0:06:08.279 the halves, voting for the prosperity of those that participate 0:06:08.360 --> 0:06:11.800 in the markets. Alicia Levine is a wonderful student of this. 0:06:11.920 --> 0:06:15.120 She's a b and y melon with acute mathematics and 0:06:15.160 --> 0:06:18.680 a really really sharp set of critical thinking skills to 0:06:18.720 --> 0:06:22.159 get us through two thousand twenty one. Alicia, if you 0:06:22.240 --> 0:06:26.640 amended your view forward of the events of the last 0:06:26.680 --> 0:06:30.520 thirty days, Yeah, good morning, Good morning, dream team. Your 0:06:30.560 --> 0:06:35.719 coverage has been really wonderful this morning. Really enjoying it. Um, Yes, 0:06:35.920 --> 0:06:39.039 we have, so we The way we've amended it is 0:06:39.080 --> 0:06:42.480 to say that we think that for markets, the cyclical 0:06:42.520 --> 0:06:46.039 trade has legs, it's deepened, and that the name of 0:06:46.040 --> 0:06:49.800 the game is rotation here. And we think that because 0:06:50.040 --> 0:06:53.240 as you can see, the stimulus is going to be enormous. 0:06:53.760 --> 0:06:57.320 The initial proposal put forth by the incoming Biden administration 0:06:57.440 --> 0:07:00.600 is double the size that Wall Street was really a expecting, 0:07:01.200 --> 0:07:05.159 and direct checks to households are already being spent. We 0:07:05.200 --> 0:07:08.720 saw the December direct checks coming into households the first 0:07:08.720 --> 0:07:10.880 twelve days of the year on the order of a 0:07:10.920 --> 0:07:14.200 hundred and thirty billion dollars, and those people who received 0:07:14.240 --> 0:07:17.840 direct checks have already increased their credit card spending by 0:07:18.280 --> 0:07:20.920 in the first week of January alone. So what does 0:07:20.960 --> 0:07:25.800 that mean? This this economy is seventy consumption and whether 0:07:25.840 --> 0:07:28.600 their households are saving the checks or spending them, g 0:07:28.760 --> 0:07:31.560 d P will be going higher and with that the 0:07:31.600 --> 0:07:35.040 sectors that are levered to the cyclical recovery will move 0:07:35.160 --> 0:07:39.520 higher as well, and this trade will have legs Alicia, 0:07:39.520 --> 0:07:43.240 where is that money being spent? So it's interesting. So 0:07:43.280 --> 0:07:45.640 the households that are spending it tend to be households 0:07:45.680 --> 0:07:48.960 that earned fifty dollars or less, and it's being spent 0:07:49.080 --> 0:07:54.760 on things like clothing and food and and housing. Um. 0:07:54.760 --> 0:07:57.200 The household that are spending it tend to be the 0:07:57.240 --> 0:08:01.080 wealthier households. And that's why we think the second half 0:08:01.120 --> 0:08:04.160 of the year, when services can come back online in 0:08:04.200 --> 0:08:06.760 a more meaningful way, in a in a more regular 0:08:06.800 --> 0:08:12.040 way because of the dissemination of vaccine, those households right 0:08:12.080 --> 0:08:16.000 now have an extra one point for trillion dollars to 0:08:16.120 --> 0:08:18.520 spend in savings, and that pent up demands is going 0:08:18.560 --> 0:08:21.280 to meet that savings it's going to get higher with 0:08:21.360 --> 0:08:24.440 increased checks to households. It's gonna be enormous spending in 0:08:24.480 --> 0:08:27.120 this country. I think the boom is coming. So how 0:08:27.200 --> 0:08:30.000 quickly could that spending drop off if we don't get 0:08:30.120 --> 0:08:33.320 some sort of additional fiscal stimulus passed in the upcoming 0:08:33.360 --> 0:08:36.440 to three months. So the bill that was passed in 0:08:36.480 --> 0:08:38.800 December was really meant to get us through the end 0:08:38.840 --> 0:08:42.640 of March, because the unemployment benefits expired and the extra 0:08:42.760 --> 0:08:45.080 three dollars a week expires at the end of March, 0:08:45.480 --> 0:08:47.680 and the checks really are of the amount to get 0:08:47.720 --> 0:08:51.360 households through the end of March. So the Biden plan 0:08:51.600 --> 0:08:54.120 is is another bridge, right, and and that's really to 0:08:54.160 --> 0:08:58.320 look forward, get households um equalized here and how they 0:08:58.360 --> 0:09:03.319 can handle their other scourge of the pandemic getting us 0:09:03.360 --> 0:09:07.760 through into June and July. This is a lot of money, folks. 0:09:07.840 --> 0:09:10.640 It's very hard to overstate how much money is being 0:09:10.679 --> 0:09:13.840 spent on rescue here. And this is one reason why 0:09:13.920 --> 0:09:16.800 a lot of people are expecting inflation to pick up 0:09:17.000 --> 0:09:19.160 as the year goes on. This is one of the 0:09:19.200 --> 0:09:22.040 big conundrums, though, couldn't pick up quite a bit more 0:09:22.080 --> 0:09:25.240 than people had expected, pushing yields higher, pushing the Fed's 0:09:25.280 --> 0:09:28.840 hands and frankly, torpedoing some of the most popular calls 0:09:28.920 --> 0:09:31.600 in the equity market. Do you see a growing risk 0:09:31.640 --> 0:09:33.880 of that given the pent up demand that can pent 0:09:34.120 --> 0:09:37.520 up savings that you just talked about. Yeah, highly. So 0:09:37.720 --> 0:09:40.520 this is like the question for the markets this year, 0:09:40.559 --> 0:09:44.080 This is the defining question, and that's how quickly do 0:09:44.320 --> 0:09:47.000 yields rise and what does the FED do about it? 0:09:47.280 --> 0:09:50.120 So the biggest risk to markets here is the spiking yields, 0:09:50.160 --> 0:09:53.560 not so much the gently rolling higher, but the spike. 0:09:54.000 --> 0:09:57.400 And it's very clear that inflation will look hotter simply 0:09:57.440 --> 0:10:00.880 because of calendar effects, because of base effect into the spring. 0:10:01.320 --> 0:10:04.120 So no one should get too concerned about that. What 0:10:04.120 --> 0:10:06.760 we've heard from the FED is that they're willing um 0:10:06.800 --> 0:10:11.959 for higher inflation prints in to kind of pass by. However, 0:10:12.160 --> 0:10:17.680 base effects can still seep into forward looking inflation expectations, 0:10:17.760 --> 0:10:19.880 and so it's not just a wash, it's something to 0:10:19.920 --> 0:10:22.760 look out for. We think the risk for inflation is higher. 0:10:23.160 --> 0:10:25.560 I think the market will overlook what happens in the 0:10:25.600 --> 0:10:28.320 prints for the spring as we move through the rest 0:10:28.360 --> 0:10:30.120 of the year. I think the risk of that inflation 0:10:30.200 --> 0:10:34.200 is higher than markets are currently expecting. Alicia, there's definitely 0:10:34.240 --> 0:10:36.320 a lot of concern about this, and this is something 0:10:36.320 --> 0:10:38.760 that we keep hearing about, this idea of inflation and 0:10:38.840 --> 0:10:41.400 picking up. How do stocks respond if you do get 0:10:41.440 --> 0:10:44.400 what you expect, which is higher than expected inflation. So 0:10:44.440 --> 0:10:47.160 it's going to happen as as bond yields move higher, 0:10:47.200 --> 0:10:49.160 is that you're going to compress some of the pees, 0:10:49.200 --> 0:10:51.480 the preceding ratios, and that's going to really affect some 0:10:51.520 --> 0:10:54.240 of the tech trades because what we because those are 0:10:54.520 --> 0:10:58.160 long duration assets with high you know, high cash flowing assets, 0:10:58.200 --> 0:11:02.839 So higher yields will dent some of the pe exuberants 0:11:02.840 --> 0:11:05.720 on the tech trade, which is why we like cyclicals here. 0:11:06.160 --> 0:11:08.640 We think overall it's not going to be a dent 0:11:08.760 --> 0:11:11.240 in the market because the earnings power coming from the 0:11:11.320 --> 0:11:15.600 cyclicals should kind of overcome the lower pees that the 0:11:15.640 --> 0:11:19.080 market is willing to pay. Overall, we think earnings are 0:11:19.120 --> 0:11:21.720 going higher, particularly in the second half of the year, 0:11:22.200 --> 0:11:26.400 and that earnings of recovery is going to propel markets 0:11:26.440 --> 0:11:29.920 going forward, not so much the pees, it's the earnings recovery. 0:11:30.040 --> 0:11:35.400 Felicia Levine Withe this with b n Y Melon we'd 0:11:35.440 --> 0:11:37.680 like to bring in right now is Mr Biden tense 0:11:37.760 --> 0:11:41.360 church at St. Matthew's Cathedral from my own in college. 0:11:41.559 --> 0:11:43.839 Jena Zana joins us, and Rick Davis joins us. Some 0:11:44.000 --> 0:11:47.959 Stone Court as well. We now have the automobile leaving 0:11:48.000 --> 0:11:51.480 Blairhouse and this is of course, uh Mr and Mrs 0:11:51.480 --> 0:11:56.680 Biden moving off to church, Jennie. The symbolism here that 0:11:56.760 --> 0:12:00.880 we have this morning, the differences here of this visit 0:12:00.960 --> 0:12:04.160 to a church versus the visit by the President to 0:12:04.280 --> 0:12:07.320 a church in the Ride and storm of Black Lives 0:12:07.360 --> 0:12:10.440 Matter last summer. It's just as stark is anything in 0:12:10.480 --> 0:12:14.600 this nation. Yeah, absolutely, and and by design I think, um, 0:12:14.640 --> 0:12:19.160 you know, the Biden incoming administration has really been focused 0:12:19.240 --> 0:12:22.920 on making a case for bipartisanship. This is somebody who 0:12:23.000 --> 0:12:26.120 spent his life in the Senate. He understands. As he 0:12:26.120 --> 0:12:29.600 gets set to send a huge immigration bill to Congress, 0:12:29.920 --> 0:12:32.760 maybe as early as today, to sign over a dozen 0:12:32.800 --> 0:12:36.319 executive orders to try to combat the coronavirus. With this 0:12:36.400 --> 0:12:39.640 almost two trillion dollar bill, he understands he is going 0:12:39.720 --> 0:12:43.040 to need the support of Republicans. With this Senate so 0:12:43.160 --> 0:12:46.160 narrowly divided, and as he is trying. I agree with 0:12:46.240 --> 0:12:50.720 Kevin to use the trip to the church symbolically, and 0:12:50.840 --> 0:12:54.000 he's going to be accompanied by members of the leadership 0:12:54.040 --> 0:12:57.280 on the Republican side to make the case for bipartisanship, 0:12:57.280 --> 0:12:59.480 which we're going to hear an awful lot about unity 0:12:59.520 --> 0:13:01.920 today and a speech I suspect as well. Maybe there'll 0:13:01.920 --> 0:13:04.319 be some prayers in the Republican Party as they consider 0:13:04.360 --> 0:13:06.800 a new Senate and not a fracture, but a more 0:13:06.880 --> 0:13:10.199 fragile house. Rick Davis joins us now with his service 0:13:10.280 --> 0:13:13.920 to the gentleman from Arizona, Mr McCain over the years, 0:13:14.160 --> 0:13:17.320 Rick Davis, How does Senator McConnell pick up this pieces? 0:13:17.440 --> 0:13:22.120 What is the McConnell process is minority leader even in 0:13:22.160 --> 0:13:25.720 the next weeks and certainly in the next months. Well, Tom, 0:13:25.760 --> 0:13:29.760 it's it's hard to conceive of that term Mitch McConnell 0:13:29.800 --> 0:13:33.440 as minority leaders. Uh, but he's already sort of tipped 0:13:33.480 --> 0:13:36.280 his hat. He's speaking pretty freely these days, which is 0:13:36.360 --> 0:13:40.319 somewhat unusual about his plans as minority leader. And he 0:13:40.320 --> 0:13:43.600 he did talk about the fact that in a divided Senate, 0:13:44.000 --> 0:13:46.160 you're going to need to compromise and I thought I 0:13:46.200 --> 0:13:49.080 would never live to hear the word compromise come out 0:13:49.080 --> 0:13:52.320 of Mitch McConnell's mouth. But I think this is the 0:13:52.400 --> 0:13:55.800 new Mitch McConnell, and I think he'll use opportunities to 0:13:56.080 --> 0:13:58.880 ensure that legislation that does get through the United States 0:13:58.880 --> 0:14:01.000 Senate has his work on it. He knows he can't 0:14:01.040 --> 0:14:05.080 control the agenda now, but he can impact the outcome 0:14:05.120 --> 0:14:07.720 of this legislation, and so I think that will be 0:14:07.760 --> 0:14:10.720 his top priority, is just make sure that things don't 0:14:10.720 --> 0:14:13.760 get through the Senate that cause irreparable harm to the 0:14:13.800 --> 0:14:16.959 economy and to the policies of our nation. When Rick 0:14:17.240 --> 0:14:20.320 what Rick? When Tom talks about unity and the fractures 0:14:20.320 --> 0:14:22.760 that we've seen in the Republican Party, it raises a 0:14:22.880 --> 0:14:26.920 question of who Mitch McConnell is representing right now. Given 0:14:26.920 --> 0:14:30.400 the fact that a majority of Republicans polled according to 0:14:30.440 --> 0:14:33.440 a number of different polls, still support President Trump, do 0:14:33.520 --> 0:14:35.880 not think that he should have been, uh but impeached 0:14:36.040 --> 0:14:38.760 or that he should resign. What do you make of 0:14:38.840 --> 0:14:41.680 that in terms of how it influences Mitch McConnell and 0:14:41.760 --> 0:14:45.520 his Republican Party as he charts his path forward. Well 0:14:45.520 --> 0:14:48.640 Mitch mconnell still has office and office matters in these 0:14:48.720 --> 0:14:52.400 kinds of cases. So regardless of the public popularity within 0:14:52.480 --> 0:14:56.320 the Republican Party that Donald Trump has, Mitch McConnell actually 0:14:56.360 --> 0:14:58.920 gets to go to work tomorrow morning and do the 0:14:59.000 --> 0:15:02.440 nation's business. And so he will be one of a 0:15:02.440 --> 0:15:05.440 couple of national leaders who are going to form the 0:15:05.480 --> 0:15:09.360 Republican Party outlook on policy and politics between now and 0:15:09.360 --> 0:15:11.960 the midterm elections, which is the next real check in 0:15:12.000 --> 0:15:15.360 the system, and highly unlikely that there'll be a Trump 0:15:15.400 --> 0:15:20.160 on a ticket uh in two But Mitch McConnell will 0:15:20.200 --> 0:15:24.560 have a large cache of money and is currently recruiting 0:15:24.600 --> 0:15:28.000 candidates for Senate races that are up in that period 0:15:28.000 --> 0:15:30.200 of time. So he's going to continue to be a 0:15:30.320 --> 0:15:34.480 very important mechanic of the Republican Party and a legislative strategists. 0:15:34.560 --> 0:15:38.040 And right now, uh, he is about all we've got 0:15:38.080 --> 0:15:40.560 as a leader in the Republican Party. Meanwhile, as we 0:15:40.600 --> 0:15:42.960 talk about fractures in the Republican Party, there certainly are 0:15:42.960 --> 0:15:45.760 fractures in the Democratic Party Genie, and there's a question 0:15:45.840 --> 0:15:47.880 of how much Joe Biden will be able to bring 0:15:47.920 --> 0:15:51.000 together the left and center and right frankly of the 0:15:51.040 --> 0:15:54.160 Democratic Party in order to get through his policy. What 0:15:54.480 --> 0:15:57.960 is the unity like when it comes to the Democratic caucus. 0:15:58.560 --> 0:16:01.880 The unity we're seeing today is going to be really 0:16:02.000 --> 0:16:04.960 the height of the unity we will see going forward. 0:16:05.360 --> 0:16:08.160 It is going to be tough for Joe Biden to 0:16:08.360 --> 0:16:12.800 keep this large, particularly in the House caucus together. We've 0:16:12.840 --> 0:16:17.120 already heard frustration in some quarters of the progressive wing 0:16:17.520 --> 0:16:20.840 in terms of his proposal on COVID relief, for instance, 0:16:21.440 --> 0:16:23.960 saying things like that almost two trillion dollar bill doesn't 0:16:23.960 --> 0:16:26.760 go far enough. And of course you look at the 0:16:26.760 --> 0:16:30.160 opposite side on the Republican side, and even moderate Democrats 0:16:30.400 --> 0:16:32.800 they say it goes way too far. In other words, 0:16:32.840 --> 0:16:35.600 what does a fifteen dollar minimum wage have to do 0:16:35.680 --> 0:16:39.400 with battling the coronavirus. So Joe Biden is going to 0:16:39.440 --> 0:16:41.480 have his work cut out for him trying to keep 0:16:41.480 --> 0:16:44.720 the caucus together on the Democratic side and trying to 0:16:44.880 --> 0:16:50.359 please this really loud and energetic progressive wing of that party, 0:16:50.600 --> 0:16:52.960 because he's going to have to do that, and his 0:16:53.000 --> 0:16:55.400 focus is going to have to be trying to get 0:16:55.440 --> 0:16:58.400 to sixty in the Senate, and that means he's going 0:16:58.440 --> 0:17:02.000 to have to appeal to moderate Publicans and moderate Democrats, 0:17:02.040 --> 0:17:04.680 and that's not going to make the progressives happy. So 0:17:04.720 --> 0:17:07.520 all these bills were seeing him talk about, from immigration 0:17:07.560 --> 0:17:10.760 to COVID relief. I suspect we will see watered down 0:17:10.880 --> 0:17:13.359 versions of that if we see them get through the 0:17:13.400 --> 0:17:16.800 Senate at all. And yesterday in Congress we got signals 0:17:17.000 --> 0:17:19.879 it's not going to be easy, people like Josh Holly 0:17:19.960 --> 0:17:23.920 holding up the DHS cabinet nomination, not fast tracking it, 0:17:24.320 --> 0:17:28.200 Chuck Grassley saying he's got concerns about the COVID relief bill, 0:17:28.200 --> 0:17:31.639 amongst other things, with the liberal components of that in there. 0:17:31.960 --> 0:17:35.160 So those are signs already before Joe Biden is even 0:17:35.200 --> 0:17:38.480 inaugurated that this is going to be a tough sort 0:17:38.520 --> 0:17:42.320 of line for him to walk here jeans Ana with us, 0:17:42.320 --> 0:17:45.360 and also Rick Davis here and again at the nine 0:17:45.400 --> 0:17:50.120 o'clock our the Air Force one pulling away at Andrew's 0:17:50.160 --> 0:17:54.240 Air Force Base, a president on his way to Florida, 0:17:54.320 --> 0:17:58.400 and outside the Cathedral of St. Matthew in Washington, we're 0:17:58.400 --> 0:18:01.879 waiting for Mr Biden, I believe, to uh enter the church, 0:18:01.920 --> 0:18:05.040 and of course other worthies attending as well. The church 0:18:05.280 --> 0:18:08.520 is one of the Jewels of Washington as a LeFarge 0:18:08.880 --> 0:18:11.639 at the turn of the nineteenth century. It is Romanesque. 0:18:11.840 --> 0:18:13.639 For those of you know the know Boston, there's the 0:18:13.720 --> 0:18:16.840 church at Copley Square, which is much the same feeling, 0:18:16.880 --> 0:18:21.080 maybe a number of years earlier uh than that, Rick Davis, 0:18:21.200 --> 0:18:23.240 you know, is we go to this hour as the 0:18:23.320 --> 0:18:27.119 president flies away. It is a changing of the era. 0:18:27.280 --> 0:18:29.959 And what's so interesting to me, Rick Davis, there's a 0:18:30.040 --> 0:18:34.520 huge presumption with Biden a seventy eight that this is 0:18:34.800 --> 0:18:38.040 a one term presidency. I believe in my life I've 0:18:38.119 --> 0:18:41.760 never understood this was a one term presidency as much 0:18:41.800 --> 0:18:45.439 as this moment. How Rick Davis does the assumption of 0:18:45.480 --> 0:18:49.439 a one term presidency changed the moment And it's a 0:18:49.520 --> 0:18:52.520 very good point, Tom. Joe Biden, because of his age, 0:18:52.720 --> 0:18:57.480 is probably termed out the day he gives his swearing in, 0:18:57.720 --> 0:19:02.200 so uh it is something to remember. UH. Kamala Harris 0:19:02.359 --> 0:19:06.760 is a uh new vice president, as has been remarked 0:19:06.800 --> 0:19:10.560 many times historic UH, and she is going to be 0:19:10.760 --> 0:19:14.679 seen as an heir apparent uh to Joe Biden for 0:19:15.160 --> 0:19:19.440 a presidential run. In The question is can Joe Biden 0:19:20.119 --> 0:19:24.080 UH be relevant over the next two years in order 0:19:24.080 --> 0:19:26.840 to ensure that he doesn't start acting like a lame 0:19:26.920 --> 0:19:31.240 duck president. As we recall, UH, in the last term 0:19:31.440 --> 0:19:36.280 of UH Barack Obama's presidency, he was almost termed out. 0:19:36.680 --> 0:19:39.600 In the first year of his second term, people saw 0:19:39.680 --> 0:19:43.120 him no longer as the future UH, and so policy 0:19:43.200 --> 0:19:48.600 waned and legislative action slowed down. UH Biden's got some momentum, 0:19:48.760 --> 0:19:50.560 and he can write it as long as he can, 0:19:50.960 --> 0:19:53.800 but the political realities are that he is in the 0:19:53.880 --> 0:19:56.320 future of the Democratic Party. Two of you, thank you 0:19:56.400 --> 0:19:58.320 so much. I know you'll be giving us guidance and 0:19:58.400 --> 0:20:00.679 wisdom through the day. We greatly pre should a genius 0:20:00.880 --> 0:20:07.240 of my owner and Rick Davis as well joining us 0:20:07.240 --> 0:20:12.119 now handrittas Race of Vada Partners Economic policy director Handritt 0:20:12.160 --> 0:20:14.480 sid I spelled on the words of Kevin, the biggest 0:20:14.480 --> 0:20:17.000 policy battled down in d C still would come where 0:20:17.040 --> 0:20:19.560 does it lie? I think the most interesting thing, and 0:20:19.640 --> 0:20:22.680 Kevin gave such a great round up, is the reality 0:20:22.720 --> 0:20:25.320 that Senator Schumer is going to be controlling the Senate 0:20:25.320 --> 0:20:28.440 floor from here. So perhaps Senator Marco Rubio and others 0:20:28.480 --> 0:20:30.280 in the Republican Conference want to hold out for the 0:20:30.320 --> 0:20:33.440 perfect they may be able to make some real changes, 0:20:33.520 --> 0:20:35.680 but when push comes to shove, it's going to be 0:20:35.720 --> 0:20:38.399 a majority Leader Schumer that decides which bills go to 0:20:38.440 --> 0:20:40.800 the Senate floor, and they're gonna have to vote against 0:20:41.160 --> 0:20:44.719 a direct payment to individuals, against unemployment insurance benefits at 0:20:44.720 --> 0:20:48.199 the federal level, against more vaccine and testing funding for 0:20:48.240 --> 0:20:50.480 state and local governments. And that's going to be something 0:20:50.520 --> 0:20:53.080 that they have to wear that they have not had 0:20:53.119 --> 0:20:55.840 to deal with under Majority Leader Mitch McConnell. So I 0:20:55.840 --> 0:20:59.080 think that start rate a big number, a big number, 0:20:59.240 --> 0:21:01.639 one point nine really, and Henrietta and we've had a 0:21:01.640 --> 0:21:04.239 big conversation the last couple of weeks about how much 0:21:04.320 --> 0:21:06.000 that will have to come down. If you've got a 0:21:06.000 --> 0:21:09.399 base case yet, Yeah, my base cases that we probably 0:21:09.480 --> 0:21:10.960 end up at the very low end, in the seven 0:21:11.400 --> 0:21:13.920 fifty billion dollar range, if they really try to get 0:21:13.960 --> 0:21:15.720 sixty votes in ten of which we need to come 0:21:15.760 --> 0:21:18.160 from the Republican conference. At the high end, maybe one 0:21:18.160 --> 0:21:21.600 and a half trillion UM. I think that those negotiations 0:21:21.640 --> 0:21:24.760 will probably last until about mid February, and then we'll 0:21:24.760 --> 0:21:26.720 have an understanding of whether Democrats are going to have 0:21:26.760 --> 0:21:28.800 to go it alone or continue trying to negotiate a 0:21:28.800 --> 0:21:32.120 bipartisan package. Um, so it's gonna be a couple more weeks. 0:21:32.160 --> 0:21:34.560 Here Henry and the time keen here in good morning 0:21:34.600 --> 0:21:37.760 to you on this day of inauguration. Is the committee 0:21:37.800 --> 0:21:42.960 process broken forever? Uh? In the Senate? I don't think so. 0:21:43.119 --> 0:21:45.640 I mean, if that's what you're referring to, I think 0:21:45.680 --> 0:21:49.159 that the committees are, especially with the Senators. There's a 0:21:49.160 --> 0:21:51.280 lot of seniority there. So, for instance, there's a lot 0:21:51.320 --> 0:21:54.000 of attention on Senator Bernie Sanders, who will be chairman 0:21:54.119 --> 0:21:56.800 or co chair of the Senate Budget Committee. They're gonna 0:21:56.880 --> 0:21:59.840 come with to an agreement on how to proceed. It 0:22:00.040 --> 0:22:01.840 may take a couple of weeks to hash out, but 0:22:01.880 --> 0:22:04.000 there will be a path forward. They will divvy up 0:22:04.000 --> 0:22:06.800 committee assignments, there will be staff and budgets prepared for 0:22:06.840 --> 0:22:09.760 all of them. There will be a reconciliation bill potentially 0:22:09.800 --> 0:22:11.840 even three depending on who you talked to in the 0:22:11.840 --> 0:22:15.640 Democratic Conference, and this, this power sharing agreement will get. 0:22:15.640 --> 0:22:17.679 Sort of an interesting thing to keep your eye on 0:22:17.800 --> 0:22:21.120 is whether any of the senators decided to leave either 0:22:21.160 --> 0:22:23.919 of their parties become an independent and caucus with the 0:22:23.960 --> 0:22:26.600 other side. Last time around, that's what happened. We could 0:22:26.640 --> 0:22:29.600 definitely see that again. Yesterday we heard Jenny Ellen in 0:22:29.640 --> 0:22:31.840