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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the

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Speaker 1: Bloomberg Balance of Power podcast. Catch us live weekdays at

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Speaker 1: you get your podcasts, or watch us live on YouTube.

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Speaker 2: Here on Bloomberg TV and Radio Live on YouTube and.

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Speaker 3: Bloomberg Originals as well.

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Speaker 2: Thanks for joining us as we look for the way

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Speaker 2: forward here when it comes to Iran, along with.

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Speaker 3: A couple of other issues.

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Speaker 2: But this is the story we're going to stick with

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Speaker 2: as an important meeting gets under way today in Geneva

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Speaker 2: with Iran's foreign minister, and we're now calling the E three,

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Speaker 2: the leaders of Britain, France and Germany, all after yesterday's

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Speaker 2: revelation by President Trump that we now have two weeks

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Speaker 2: of breathing room to find a diplomatic solution. There were

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Speaker 2: questions when we last spoke on Wednesday, of course, about

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Speaker 2: whether a US strike against Iran was imminent. We'd heard

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Speaker 2: from the White House Press Secretary Caroline Levitt yesterday on

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Speaker 2: this two weeks it is if.

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Speaker 4: The US worst take some type of military action, would

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Speaker 4: the President go to Congress to seek war authority.

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Speaker 5: I'm not going to engage in hypotheticals. I gave you

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Speaker 5: the statement from the President he'll make a decision within two.

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Speaker 2: Weeks, simple as that. As we bring in Nick Wadhams

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Speaker 2: on the conversation, who leads our national security team here

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Speaker 2: in Washington.

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Speaker 3: Nick, it's great to see you.

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Speaker 2: This has been a pretty interesting process, and now we've

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Speaker 2: got a meeting underway with the chance for a diplomatic solution.

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Speaker 2: It's unclear what exactly motivated President Trump to allow for

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Speaker 2: the two weeks. But when you hear from Iran's foreign

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Speaker 2: minister actually making tracks to Geneva, what does that tell us.

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Speaker 4: It could tell us a lot, or it could tell

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Speaker 4: us nothing. I mean, I think the thing that's really

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Speaker 4: interesting from the Caroline Levitt statement is she says within

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Speaker 4: two weeks and it's okay. Well, if you start to

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Speaker 4: actually parse that, it's like, well, what does that mean?

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Speaker 4: I mean, the interpretation had been okay, they're giving us

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Speaker 4: a two week reprieve, but then she's saying within, which

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Speaker 4: means it really could happen at any time. So it

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Speaker 4: does give the president a little breathing room because there

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Speaker 4: had been. As we and many others have reported, the

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Speaker 4: conventional wisdom was that these strikes were going to happen

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Speaker 4: this weekend, and a lot of anticipation for that. She

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Speaker 4: now seems to be broadening out the time horizon. What

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Speaker 4: does seem clear is the President has not made a

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Speaker 4: final decision, but the issue of the Iranian foreign minister

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Speaker 4: meeting the Europeans, in some ways I see that as

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Speaker 4: almost as like a last ditch effort, But the President

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Speaker 4: has been very dismissive of European efforts. In large part

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Speaker 4: he really wants this to be a US Iran conversation,

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Speaker 4: So it's not clear to me what Iran could say

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Speaker 4: in that meeting that would persuade him to hold out.

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Speaker 2: He may not find that a deal with the Europeans

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Speaker 2: is credible to begin with. You just left them in

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Speaker 2: Canada to think about it. You were there as a

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Speaker 2: matter of fact. But interesting to hear from the UK

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Speaker 2: Foreign Minister David Lammy on X he wrote, the situation

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Speaker 2: in the Middle East remains perilous. So this is following

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Speaker 2: a meeting with Marco Rubio and Steve Whitcoff. He writes,

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Speaker 2: we're determined that Iran must never have a nuclear weapon.

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Speaker 2: Meeting with Rubio and Whitcoff at the White House today,

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Speaker 2: we discussed how a deal could avoid a deepening conflict.

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Speaker 2: A window now exists within the next two weeks to

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Speaker 2: achieve a diplomatic solution. Is it his job to express

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Speaker 2: that kind of optimism or was there a feeling in

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Speaker 2: the room that we might have avoided a war.

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Speaker 4: I think what you're seeing here is officials from everywhere,

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Speaker 4: whether it's the US and non officials like Steve Bannon

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Speaker 4: or Tucker Carlson, and now the UK and others basically

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Speaker 4: trying to triangulate and get messages to Trump. I mean,

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Speaker 4: whenever we talk to people about well, what is he

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Speaker 4: going to do? Will he won't he? The response is

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Speaker 4: always it really depends on who the last person was

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Speaker 4: he spoke to. So this is the sort of infamous

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Speaker 4: or famous way that Trump does business. He has a

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Speaker 4: lot of ideas, but then it often comes down to

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Speaker 4: who got to him last. So I think what you're

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Speaker 4: seeing from the UK there is in some ways the

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Speaker 4: government in the UK has tried to play the role

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Speaker 4: of not necessarily peacemaker, but hey, let's take a breath here.

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Speaker 4: Kier Starmer, the Prime Minister, said a couple days ago

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Speaker 4: he believed the President was not going to attack. Now

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Speaker 4: you have this nason effort by the Europeans. Okay, let's

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Speaker 4: just take a breath, let's have this little window, let's

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Speaker 4: see if we can get something done. But the President

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Speaker 4: himself has said, you know, essentially that it was too late.

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Speaker 4: Iran had sixty days and that's what led to this

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Speaker 4: Israeli strike. Counter that against the idea of him as

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Speaker 4: the deal maker. He would there's no one who wants

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Speaker 4: a deal more than Donald Trump wants a deal. He

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Speaker 4: would love to get a deal here. The question is

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Speaker 4: is there anything that Iran can say now that is

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Speaker 4: going to satisfy him and make him say okay, I

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Speaker 4: mean a meeting with the Europeans right now. I'm not

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Speaker 4: really sure what Iran could do short of saying, okay,

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Speaker 4: we are going to give up all of our aspirations

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Speaker 4: for which.

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Speaker 3: You know not gonna do. Okay, so we have two weeks.

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Speaker 2: The conventional wisdom on Wednesday was you need b two

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Speaker 2: bombers with these mop bombs to get to four doh

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Speaker 2: and the sensitive enrichment facility under a mountain in Israel.

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Speaker 2: Now there's this idea, Well, what if Benjamin NETTNYA who

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Speaker 2: has two weeks and he might actually send special forces

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Speaker 2: inside that complex. Donald Trump doesn't need to put Americans

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Speaker 2: in harm's way. Is he allowing for that possibility?

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Speaker 6: Yeah?

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Speaker 3: I think so.

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Speaker 4: I mean you can imagine what the conversations look like

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Speaker 4: in the White House as the President says, Okay, what

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Speaker 4: are my options? What's the best case scenario? What's the

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Speaker 4: worst case scenario? I mean, yes, they have air dominance,

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Speaker 4: but there is still a potential risk that a US

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Speaker 4: plane could get shot down. US service members' lives could

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Speaker 4: be lost. Obviously, the question of okay, if you do

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Speaker 4: this strike from this bomb, we believe it would have

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Speaker 4: a devastating impact. It might not have a devastating impact.

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Speaker 4: We don't know. This is this weapon is largely unproven

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Speaker 4: in a situation like this, so no guarantee that it

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Speaker 4: would have the effect the US wants it to have. Suddenly,

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Speaker 4: the US the administration has pulled deeper into this conflict.

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Speaker 4: What if then US bases are attacked. So he's getting

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Speaker 4: advice from a lot of folks who say, oh yeah,

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Speaker 4: just go in, drop the thirty thousand pound bomb done

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Speaker 4: dust and we're good to go. American involvement over. He's

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Speaker 4: also presumably getting a lot of information from folks who

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Speaker 4: say high risk, potentially low reward, and then the Israelis

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Speaker 4: have said publicly, we have plenty of options here. You know,

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Speaker 4: there there are other ways of doing this, special Forces

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Speaker 4: being one of them. So obviously difficult to get inside

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Speaker 4: the president's head, but you can be sure he's getting

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Speaker 4: a lot of very different information.

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Speaker 2: A lot of worries about the day after, as they

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Speaker 2: call it day after, what Iran do to strike back

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Speaker 2: forcing continued US involvement, or what would happen if an

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Speaker 2: American air crew were shot down?

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Speaker 4: And it goes against everything the president campaigned on. I mean, yes,

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Speaker 4: peace through stress, that's a big one. But you know,

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Speaker 4: he billed himself as the peace President. I mean, I

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Speaker 4: cannot tell you the number of times I sat through

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Speaker 4: campaign rallies and also conversations with his advisors, no new

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Speaker 4: wars in the first term. Suddenly the president is potentially

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Speaker 4: going to war with Iran. I mean, that's really going

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Speaker 4: to undercut the message he has sent and a lot

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Speaker 4: of the support he gets from the MAGA base it's.

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Speaker 3: Not lost on us.

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Speaker 2: That's Steve Bannon at lunch at the White House right yesterday.

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Speaker 3: Nick.

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Speaker 2: Great to see Nick Wadhams, Bloomberg's National Security team leader

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Speaker 2: with us here in Washington. As we read the tea

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Speaker 2: leaves with two weeks out or maybe less. As Nick

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Speaker 2: identified the language here. The semantics are important within two weeks.

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Speaker 3: Is what the Press secretary said.

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Speaker 2: We had the voice of experience in Dan Kurtzer, now

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Speaker 2: with Princeton University where he's Professor of Middle East Policy,

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Speaker 2: is former US Ambassador to Israel and has been in

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Speaker 2: the room for talks like the ones we're describing today

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Speaker 2: in Geneva. Mister ambassador, welcome back to Bloomberg TV and Radio.

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Speaker 2: It's great to have you. Do you share the optimism

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Speaker 2: of the UK Foreign Minister when it comes to these

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Speaker 2: talks today in Geneva.

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Speaker 7: Well, there's no basis to be optimistic unless they've heard

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Speaker 7: something from the Iranians that they'll communicate to the President.

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Speaker 7: What they need to hear, and what the President wild

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Speaker 7: need to hear is that the Iranians are ready to

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Speaker 7: come back to the talks and understand that they will

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Speaker 7: have to give up enrichment on the Uranian soil. If

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Speaker 7: the Europeans can produce that kind of a commitment, then

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Speaker 7: the President can talk to Nitanyahu about holding up a

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Speaker 7: little bit and giving diplomacy a chance. But otherwise, aspirations

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Speaker 7: are nice, but we're really far down the road beyond

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Speaker 7: simply hope.

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Speaker 2: Well, you hear the phrase unfettered access, and it brings

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Speaker 2: you back to the nuclear deal with Iran, into years

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Speaker 2: long before that, and even to Iraq. You remember how

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Speaker 2: this goes with weapons inspectors, and it's typically not to

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Speaker 2: meet expectations. With Iran, They've turned back on a number

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Speaker 2: of promises before. Why would this time be any different.

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Speaker 7: Well, the reality is that in twenty fifteen, with the

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Speaker 7: Joint Comprehensive Plan of Action for three years, the Iranians

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Speaker 7: adhered to that agreement and each time a small violation

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Speaker 7: was uncovered, it was fixed right away. So there is

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Speaker 7: at least a small track record of Iranian compliance, which

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Speaker 7: of course ended when the United States pulled out of

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Speaker 7: the JCPOA. Now I think that we would need a

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Speaker 7: much stronger JCPOA two point zero. We'd have to have

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Speaker 7: no end date. You remember the JCPOA was supposed to

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Speaker 7: come to an end within twelve to fifteen years, so

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Speaker 7: no end date. Better assurances with regard to the reconstitution

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Speaker 7: of the program, but a tougher agreement could lead to

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Speaker 7: Iranian compliance and end of the war and therefore an

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Speaker 7: end of the Iranian nuclear program.

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Speaker 2: Is Iran more or less likely to agree to stop

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Speaker 2: enriching uranium as it is being bombed by Israel? Is

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Speaker 2: this maximum pressure campaign the type of thing that works

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Speaker 2: in this scenario or moves Iran further away from an

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Speaker 2: agreement like that?

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Speaker 7: Well, it's a great question and the answer is unknown.

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Speaker 7: Before the Israeli bombing, Iran was stuck on the idea

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Speaker 7: that it would not give up the right to enrich uranium.

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Speaker 7: So we don't know whether the debilitation of Iran's military capabilities,

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Speaker 7: its missile program, and its nuclear program will now make

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Speaker 7: a convincing argument otherwise, I think much of this is

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Speaker 7: going to depend on what's happening within the opaque system

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Speaker 7: in Tehran. The Iatolas still is calling the shots, but

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Speaker 7: there are quite a few different factions playing in this,

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Speaker 7: including more extreme elements in the Iranian Revolutionary Guards and

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Speaker 7: the so called Besiege who have argued for years that

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Speaker 7: Iran should simply develop a nuclear weapon, so they will

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Speaker 7: be pressing for that. Others might say, look, we invested

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Speaker 7: a lot, we lost a lot, we have no allies

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Speaker 7: in the region, and it's time to give it up.

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Speaker 2: It's been some interesting reporting on US intelligence estimates when

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Speaker 2: it comes to Oran's ability to end motivation to make

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Speaker 2: a nuclear weapon. We are frequently not on the same

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Speaker 2: page as Israel when it comes to this, Ambassador, and

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Speaker 2: I wonder your thoughts about the assessment we're reading about

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Speaker 2: today that Iran has yet to decide whether to make

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Speaker 2: a nuclear bomb, even though it does in fact have

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Speaker 2: a large stockpile of enriched uranium. The idea is that

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Speaker 2: it would be more likely to shift toward producing a

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Speaker 2: bomb if the US decides to get involved offensively with Israel.

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Speaker 3: Do you believe that to be true.

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Speaker 7: Well, our intelligence community has been consistent since two thousand

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Speaker 7: and three in saying that Iran is not trying to

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Speaker 7: weaponize the capability of using a nuclear weapon. And that

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Speaker 7: was something that Tulsey Gobbard back in I guess was

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Speaker 7: March April testified to Congress, and it's something that the

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Speaker 7: President simply said he didn't agree with even though it's

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Speaker 7: his intelligence of people telling him that. So you have

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Speaker 7: to distinguish between the weaponization program, which appears not to

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Speaker 7: be in place, as opposed to the preparatory steps that

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Speaker 7: Iran has been taking and accelerating since twenty eighteen, since

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Speaker 7: we pulled out of the JCPOA and they started enriching

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Speaker 7: at a much higher level up to sixty percent. There's

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Speaker 7: some indication that at least at one point they went

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Speaker 7: beyond sixty percent, which would bring them very very close

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Speaker 7: to being a threshold nuclear state with a breakout time

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Speaker 7: that's essentially days, not even weeks. So they're prepared, I think,

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Speaker 7: to move expeditiously. Their capabilities are much less today as

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Speaker 7: a result of Israeli bombing. Question is, how do you

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Speaker 7: make sure that what Israel accomplished militarily is sustainable and

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Speaker 7: that Iran cannot reconstitute his program.

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Speaker 2: So, Ambassador, what do you expect to take place then

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Speaker 2: in the next two weeks, and if the US managed

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Speaker 2: to strike a deal with Iran, what Israel trusted.

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Speaker 7: Well, what I expect to take place is a lot

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Speaker 7: of back channel conversations. We know that the President's envoys,

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Speaker 7: Stephen Witkoff has tried to reach out to the Iranians.

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Speaker 7: We now have this European meeting. There's going to be

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Speaker 7: a lot of chatter behind the scenes, and I think

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Speaker 7: the President will factor that into the equation. Are the

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Speaker 7: Iranians really ready as a result of having been bruised,

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Speaker 7: Are they really ready to come to the table and

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Speaker 7: give up enrichment which would make a jcpoa two point

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Speaker 7: zero possible? Whether Nittanyahu would be satisfied with that. Look,

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Speaker 7: as far as the Israelis are concerned, unless FORDAO is

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Speaker 7: taken out the heavily fortified underground facility, they think their

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Speaker 7: job won't be done. As Nick suggested, there may be

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Speaker 7: other ways of doing it besides simply be too bombing.

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Speaker 7: You knock out the electricity, the entrances, the air supply,

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Speaker 7: and you keep at it for a while. So you're

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Speaker 7: going to see. I think in these two weeks back

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Speaker 7: channel contacts, sustained Israeli attacks, including against FORDAO, and within

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Speaker 7: that two week period, whether the President can put this

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Speaker 7: all together in a diplomatic package is literally anyone's guess

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Speaker 7: at this point.

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Speaker 2: Wow, I wouldn't want to be a worker at Forteaux

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Speaker 2: right now. Ambassador we just ran a headline across the terminal.

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Speaker 2: The Iran European nuclear talks in Geneva have come to

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Speaker 2: an end. We are standing by for a statement as

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Speaker 2: we wait for a readout and in our final moment

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Speaker 2: here together, Ambassador, Where's Russia and China on this or

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Speaker 2: are we learning right now that they have no influence

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Speaker 2: on what's happening?

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Speaker 7: Well, they certainly have little influence. The Chinese are heavily

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Speaker 7: dependent on Iran's oil and gas, and therefore they're concerned

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Speaker 7: whether this war escalates and whether attacks against the energy

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Speaker 7: infrastructure take place, or whether Iran in response blocks the

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Speaker 7: Straits of Hormuz. So the Chinese are nervous. The Russians

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Speaker 7: are incapacitated because of their own war, but nonetheless it

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Speaker 7: would behoove the President to think about including them in

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Speaker 7: any multilateral diplomatic approach. After all, it was the Russians,

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Speaker 7: Chinese and the three Europeans who joined us in twenty

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Speaker 7: fifteen to make the jcpoa work at that time. So

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Speaker 7: they're not going to be major players in this, but

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Speaker 7: they'll be important players if Iran sees that not just

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Speaker 7: the Europeans and the Americans, but also their friends in

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Speaker 7: Moscow and Beijing are telling them it's time to call

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Speaker 7: it quits.

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Speaker 2: Great to have you with us, Sir Dan Kurtzer, former

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Speaker 2: US Ambassador to Israel, now at Princeton with us here

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Speaker 2: on Balance of Power.

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Speaker 3: This is Bloomberg.

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Speaker 1: You're listening to the Bloomberg Balance of Power Podcast. Catch

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Speaker 1: us live weekdays at noon and five pm Eastern on

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Speaker 1: flagship New York station Just Say Alexa played Bloomberg.

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Speaker 2: Thank you for joining on the Friday edition. It feels

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Speaker 2: strangely like a Monday if you had the thing off yesterday.

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Speaker 2: Of course, that was June teenth at the White House,

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Speaker 2: not acknowledged, in fact, a very strange post by President

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Speaker 2: Trump on juneteenth. Instead of putting out a proclamation on

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Speaker 2: the holiday, as might be considered normal for an administration,

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Speaker 2: June teenth went unmarked by the President. As The New

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Speaker 2: York Times writes, the President brought it to truth social quote.

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Speaker 2: Soon we'll end up having a holiday for every once

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Speaker 2: working day of the year.

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Speaker 3: Strange grammar.

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Speaker 2: It must change if we're going to make America great. Again,

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Speaker 2: suggesting that we get rid of quote non working holidays unquote.

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Speaker 2: It does make you wonder if June teenth, which of

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Speaker 2: course is a federal holiday, markets were closed yesterday. We'll

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Speaker 2: survive this set and Trump administration.

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Speaker 3: The matter of immigration.

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Speaker 2: Policy in this White House is of course a massive

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Speaker 2: story right now, and we had a very important court

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Speaker 2: ruling that you may not have been paying attention to yesterday.

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Speaker 2: You should know about it. Remember, just a couple of

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Speaker 2: weeks ago, before we thought we were on the cusp

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Speaker 2: of war with Iran, we were talking about violence in

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Speaker 2: the streets of La. The deployment of National Guard troops

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Speaker 2: by the President around the back of Governor Gavin Newsom. This,

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Speaker 2: of course, has been tied up in court. Active duty

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Speaker 2: Marines were later deployed to federal property in LA and

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Speaker 2: a federal appeals court has unanimously ruled that Donald Trump

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Speaker 2: is allowed to retain control of the National Guard in California,

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Speaker 2: against the challenge from the governor. On social media, Donald Trump,

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Speaker 2: looking to the horizon again truth social handling the decision

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Speaker 2: is a big win, suggesting it would open the door

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Speaker 2: for other such deployments across the United States if law

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Speaker 2: enforcement were unable for whatever reason, he writes, to get

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Speaker 2: the job done. It's where we start with our political

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Speaker 2: panels today. Rick Davis is with US Bloomberg Politics contributor,

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Speaker 2: Republican strategist and partner at Stone Court Capital, joined today

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Speaker 2: by Matt Bennett. I'm glad to say Democratic strategist and

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Speaker 2: executive vice president of public Affairs at Third Wage.

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Speaker 3: Gentlemen. Great to see a happy Friday, and thanks for

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Speaker 3: joining us. Rick.

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Speaker 2: Are we going to start seeing examples like this in

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Speaker 2: other cities around the country?

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Speaker 3: Now?

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Speaker 6: You know?

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Speaker 8: Look, I mean, I think that Donald Trump is going

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Speaker 8: to use the power that the Constitution gives him. And

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Speaker 8: nobody debated prior to this instance in California that he

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Speaker 8: didn't have the right to call up the National Guard.

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Speaker 8: Of course, we talked about that at nauseum after the

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Speaker 8: attack on the Capitol, and why didn't Donald Trump call

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Speaker 8: up the National Guard? I mean, if it was up

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Speaker 8: to the state, the governor of Maryland would have done it.

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Speaker 8: But the reality is it's almost like the administration wants

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Speaker 8: to provoke a fight, right, and they're targeting blue states

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Speaker 8: to bring the heat of ice of Homeland security to

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Speaker 8: these deportation initiatives, and so they're going right into the

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Speaker 8: mouth of the beast. Sanctuary state, sanctuary cities. They know

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Speaker 8: they're going to get this pushback, but they also are

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Speaker 8: under enormous pressure to drive deportation. So you know, it's

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Speaker 8: a cauldron of heat, and in the summertime, heat tends

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Speaker 8: to turn into fire.

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Speaker 3: Boy, how true?

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Speaker 2: Well, put Rick, it is going to be one hundred

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Speaker 2: degrees next week, Matt Bennett.

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Speaker 3: So if you're JB.

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Speaker 2: Pritzker, if you're Kathy Hochel, if you're Governor Shapiro, what

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Speaker 2: should you be bracing for.

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Speaker 6: It's not at all clear. I mean, Rick is certainly right,

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Speaker 6: and I think the court probably got it right. They

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Speaker 6: don't like to get involved in the presence jujy'us commander

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Speaker 6: in chief, and his ability to call up the National

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Speaker 6: Guard is clear. But it is also worth noting that

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Speaker 6: this is the first time a president had called out

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Speaker 6: the guard without the support of the governor of that

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Speaker 6: state since the civil rights era in the fifties. So

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Speaker 6: it's been a while since anyone's done that, And as

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Speaker 6: Rick noted, if he had done it as governors and

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Speaker 6: the mayor were asking him to. On January sixth. That

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Speaker 6: would have been with the very strong support of the

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Speaker 6: commanders of those National Guard troops. So will this happen

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Speaker 6: in other places? I think that the White House certainly

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Speaker 6: is spoiling for a fight. They think this is working

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Speaker 6: for them. All of the quotes you saw in the

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Speaker 6: stories about this from White House aids said they thought

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Speaker 6: politically it was good to have the president fighting with

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Speaker 6: the governor of a blue state over immigration enforcement. But

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Speaker 6: I also think it's important to kind of disentangle these

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Speaker 6: two things. This wasn't about immigration enforcement. This was about

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Speaker 6: putting down violent protests, which I think the governor was correct.

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Speaker 6: The nine thousand police officers in Los Angeles were ready

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Speaker 6: to do without the National Guard.

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Speaker 2: Having thought about what Matt just said, Rick jd Vance

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Speaker 2: is reportedly preparing for a trip to Los Angeles this week.

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Speaker 2: This administration is clearly not done trying to seize on

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Speaker 2: the optics around all of this. What's going to come

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Speaker 2: from this trip? And if you were advising this administration

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Speaker 2: as a political operative, what would you be staging for

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Speaker 2: him in LA?

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Speaker 8: Well, it's like what we were talking about a minute ago, Joe.

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Speaker 8: They want to provoke, right, I mean, like in most administrations,

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Speaker 8: they'd look at this and say, hey, let's wait all

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Speaker 8: things simmer down before we go for whatever reason they

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Speaker 8: want to go. Not this administration. Jade Vince is going there.

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Speaker 8: He's going to meet with the people on the ground

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Speaker 8: who are doing deportations, who are who are imposing law

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Speaker 8: and order on these immigration protests. I mean like he's

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Speaker 8: going to go right in and throw some punches. And

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Speaker 8: it's part of this ongoing campaign not just to engage

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Speaker 8: Governor Newsom and you know, sort of take a political

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Speaker 8: stand against his leadership, but also to try to, you know,

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Speaker 8: basically change the tide a national consensus in states like

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Speaker 8: California and as you said, Illinois and Massachusetts and others

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Speaker 8: that these are sanctuary states and we're not going to

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Speaker 8: put up with it, and you're going to have to change,

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Speaker 8: and that change will not come soon. This is going

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Speaker 8: to be a fight that will take a long time.

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Speaker 8: And it's it's instructive to all of us to understand

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Speaker 8: that this administration is a provocateur.

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Speaker 6: Right.

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Speaker 8: They want to cause a fight. They're not looking for

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Speaker 8: things to settle down. Those troops are there because they

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Speaker 8: have riots, and their view is those troops are going

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Speaker 8: to stay as long as their riots, and we're going

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Speaker 8: to not do anything to take the foot off the

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Speaker 8: pedal when it comes to provoking those those protesters. So

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Speaker 8: I think we're in for a difficult summer. I don't

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Speaker 8: think this is going to be the only state that

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Speaker 8: has these kinds of issues. And it's almost like Jade

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Speaker 8: Vance has been given the mandate to go out and

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Speaker 8: support what Homeland Security is doing, what ICE is doing,

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Speaker 8: and show this administration is not back and down.

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Speaker 2: That's going to be a moment when you see him.

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Speaker 2: Maybe he'll go to Dodgers Stadium.

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Speaker 3: Matt Bennett.

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Speaker 2: If you see what happened there yesterday, quite remarkable. The

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Speaker 2: team blocked federal immigration agents from accessing Dodgers Stadium parking

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Speaker 2: lots yesterday. Now imagine a bunch of pickup trucks roll

439
00:24:30,119 --> 00:24:34,080
Speaker 2: up and you've got guys with masks on, no uniforms,

440
00:24:34,119 --> 00:24:38,280
Speaker 2: no visible badges, They're wearing street clothes, and they look scary.

441
00:24:38,640 --> 00:24:42,160
Speaker 2: Immigration and Customs Enforcement denied having agents at the stadium,

442
00:24:42,600 --> 00:24:46,000
Speaker 2: Department of Homeland Security acknowledging that Customs and Border Protection

443
00:24:46,240 --> 00:24:48,320
Speaker 2: vehicles were present. If you were with us on YouTube,

444
00:24:48,320 --> 00:24:50,920
Speaker 2: you see the back and forth on X. Dodgers wrote,

445
00:24:50,960 --> 00:24:53,720
Speaker 2: this morning, Ice agents came to the stadium and requested

446
00:24:53,720 --> 00:24:57,000
Speaker 2: permission to access the parking lots. They were denied entry.

447
00:24:57,400 --> 00:25:00,679
Speaker 2: Tonight's game will be played as scheduled. Homeland said the

448
00:25:00,720 --> 00:25:04,680
Speaker 2: incident quote had nothing to do with the Dodgers, said

449
00:25:04,720 --> 00:25:07,760
Speaker 2: that their vehicles were in stadium parking lots very briefly,

450
00:25:07,840 --> 00:25:11,679
Speaker 2: unrelated to any operation or enforcement. I just called the

451
00:25:11,680 --> 00:25:15,120
Speaker 2: statement from the Dodgers false. We were never there. I'm

452
00:25:15,200 --> 00:25:18,639
Speaker 2: really confused, and I don't know what people think was

453
00:25:18,680 --> 00:25:20,560
Speaker 2: going on. At one point, a reporter went up to

454
00:25:20,600 --> 00:25:23,919
Speaker 2: the Ice agent or these unmarked agents and said who

455
00:25:24,000 --> 00:25:28,080
Speaker 2: are you? They said DHS and would not identify themselves.

456
00:25:28,680 --> 00:25:31,600
Speaker 2: Did the Dodgers just become an example of something here?

457
00:25:31,760 --> 00:25:33,000
Speaker 3: Matt? What do you take from this?

458
00:25:34,560 --> 00:25:36,280
Speaker 6: The whole thing is so weird. I mean, how do

459
00:25:36,320 --> 00:25:41,679
Speaker 6: you wander into a giant stadium parking lot unintentioned? It

460
00:25:41,800 --> 00:25:44,320
Speaker 6: just none of it makes any sense. The answer is,

461
00:25:44,359 --> 00:25:47,040
Speaker 6: we don't know. The Dodgers happened to own a huge

462
00:25:47,080 --> 00:25:49,760
Speaker 6: piece of property, and they, as property owners, had the

463
00:25:49,840 --> 00:25:52,280
Speaker 6: right to kick those guys out. But I think the

464
00:25:52,359 --> 00:25:55,240
Speaker 6: bigger thing is that is the thing you flacked, which

465
00:25:55,280 --> 00:25:59,520
Speaker 6: is the way they're going about immigration enforcement, is really scary.

466
00:26:00,080 --> 00:26:03,240
Speaker 6: They are not, in many cases not in uniform, They

467
00:26:03,280 --> 00:26:07,439
Speaker 6: do not identify themselves, they are wearing masks, they're heavily armed.

468
00:26:07,600 --> 00:26:10,479
Speaker 6: They're grabbing people off the streets, in some cases in

469
00:26:10,520 --> 00:26:13,840
Speaker 6: front of their children. This is not the way law

470
00:26:13,880 --> 00:26:16,720
Speaker 6: enforcement is supposed to work in the United States. Law

471
00:26:16,760 --> 00:26:21,119
Speaker 6: enforcement is supposed to be clearly designated by their uniforms.

472
00:26:21,359 --> 00:26:23,280
Speaker 6: They're supposed to tell you who they are and what

473
00:26:23,320 --> 00:26:25,840
Speaker 6: they're doing, and where they're taking the people that they're taking.

474
00:26:26,359 --> 00:26:32,359
Speaker 6: So this feels very Unamerican and very authoritarian. And that's

475
00:26:32,400 --> 00:26:34,080
Speaker 6: in part the thing that I think a lot of

476
00:26:34,160 --> 00:26:36,920
Speaker 6: Democrats are responding to. And by the way, while the

477
00:26:37,080 --> 00:26:41,560
Speaker 6: Trump enforcement efforts are broadly popular, that kind of thing,

478
00:26:41,960 --> 00:26:46,880
Speaker 6: the militarization and the no markings and the thuggery, that's

479
00:26:46,960 --> 00:26:47,600
Speaker 6: not popular.

480
00:26:48,560 --> 00:26:51,000
Speaker 2: Well, the teams get some pressure to do something here.

481
00:26:51,040 --> 00:26:53,560
Speaker 2: There is an expectation that teams, and if maybe they

482
00:26:53,600 --> 00:26:57,720
Speaker 2: have already were to announce plans to assist immigrant communities,

483
00:26:58,400 --> 00:26:59,719
Speaker 2: they don't want to be in the middle of all

484
00:26:59,720 --> 00:27:03,640
Speaker 2: of this. They're trying to sell tickets to games. Rick

485
00:27:03,680 --> 00:27:05,440
Speaker 2: what do you make of this though. I mean, if

486
00:27:05,440 --> 00:27:07,439
Speaker 2: you see these guys roll into a parking lot, they

487
00:27:07,440 --> 00:27:09,360
Speaker 2: could be the Proud Boys for crying out loud. They've

488
00:27:09,359 --> 00:27:11,320
Speaker 2: got a pickup truck. You don't see a badge. To

489
00:27:11,440 --> 00:27:14,440
Speaker 2: what extent does all of this legal and effective?

490
00:27:15,880 --> 00:27:17,919
Speaker 8: Yeah, well, I think you know, the courts are going

491
00:27:18,000 --> 00:27:21,359
Speaker 8: to tell us ultimately what's legal. I think there's a

492
00:27:21,400 --> 00:27:25,720
Speaker 8: lot of extracurricular activity going on around the country with

493
00:27:26,440 --> 00:27:29,600
Speaker 8: these kinds of sort of pseudo militant groups who have

494
00:27:29,680 --> 00:27:31,320
Speaker 8: decided to take this on for themselves.

495
00:27:31,359 --> 00:27:31,800
Speaker 2: I have been.

496
00:27:31,800 --> 00:27:37,680
Speaker 8: Already examples of non law enforcement, non federal agents getting

497
00:27:37,720 --> 00:27:42,120
Speaker 8: in the act of rolling up people they assume are

498
00:27:42,240 --> 00:27:45,359
Speaker 8: undocumented and don't seem to be trying very hard to

499
00:27:45,400 --> 00:27:49,520
Speaker 8: identify those people in the time they harass them. So, look,

500
00:27:49,960 --> 00:27:53,000
Speaker 8: we're in a tough environment, and Matt's right, I mean,

501
00:27:53,119 --> 00:27:56,520
Speaker 8: like we are all about law enforcement. We want law

502
00:27:56,600 --> 00:27:58,760
Speaker 8: enforcement to work in this country. We are a country

503
00:27:58,760 --> 00:28:04,600
Speaker 8: of laws. Why our cars for cops are painted explicitly

504
00:28:04,640 --> 00:28:08,480
Speaker 8: with the identifications that they have. That's why uniforms are

505
00:28:08,480 --> 00:28:12,919
Speaker 8: a must with our agents. Sure, there are undercover people

506
00:28:13,160 --> 00:28:16,280
Speaker 8: working to preserve law and order in our country, but

507
00:28:16,520 --> 00:28:19,800
Speaker 8: not in the context of rolling up folks for deportation

508
00:28:20,200 --> 00:28:24,440
Speaker 8: in black minivans with no markings on them. This is

509
00:28:25,040 --> 00:28:27,119
Speaker 8: not the United States. And if there's one thing I

510
00:28:27,160 --> 00:28:29,920
Speaker 8: know about the American public, and it's reinforced over and

511
00:28:30,040 --> 00:28:33,639
Speaker 8: over and over again in all the survey data, is

512
00:28:33,680 --> 00:28:36,920
Speaker 8: we are a country of fairness. We want a fair fight,

513
00:28:37,080 --> 00:28:40,360
Speaker 8: we want a fair chance. And when we see those

514
00:28:40,400 --> 00:28:44,120
Speaker 8: tables being turned to the point where there is unfair

515
00:28:44,200 --> 00:28:47,840
Speaker 8: activity occurring in these jurisdictions as it relates to these

516
00:28:47,960 --> 00:28:51,400
Speaker 8: kinds of things, families are being treated poorly, they will

517
00:28:51,440 --> 00:28:54,440
Speaker 8: react negatively. And at the end of the day, the

518
00:28:54,720 --> 00:28:58,760
Speaker 8: biggest check on power in the United States is with voters,

519
00:28:59,000 --> 00:29:02,280
Speaker 8: and the President is playing with fire if he doesn't

520
00:29:02,320 --> 00:29:05,440
Speaker 8: think these kinds of tactics aren't going to be punished

521
00:29:06,320 --> 00:29:10,280
Speaker 8: come midterm elections, and we all watch the House of

522
00:29:10,320 --> 00:29:14,640
Speaker 8: Representatives being so close. Three members alone will flip the power.

523
00:29:15,160 --> 00:29:17,520
Speaker 8: But there are a lot of senators I know from

524
00:29:17,560 --> 00:29:20,800
Speaker 8: Republican states who are starting to worry about what impact

525
00:29:20,880 --> 00:29:23,120
Speaker 8: all this is going to have on their reelections.

526
00:29:23,960 --> 00:29:28,160
Speaker 2: Wow, really smart analysis from both Rick Davis and Matt Bennett.

527
00:29:28,160 --> 00:29:30,760
Speaker 2: A great panel and a great conversation, remembering, of course,

528
00:29:31,200 --> 00:29:34,800
Speaker 2: Donald Trump doesn't want masks on protesters, and there are

529
00:29:34,800 --> 00:29:36,880
Speaker 2: a lot of questions right now about why there are

530
00:29:36,960 --> 00:29:42,880
Speaker 2: masks on law enforcement, particularly when they're not identifying themselves.

531
00:29:43,880 --> 00:29:47,360
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch

532
00:29:47,400 --> 00:29:50,400
Speaker 1: us live weekdays at noon and five pm Eastern on

533
00:29:50,560 --> 00:29:53,800
Speaker 1: Alma Cockley and Android Atto with the Bloomberg Business App.

534
00:29:54,000 --> 00:29:57,200
Speaker 1: Listen on demand wherever you get your podcasts, or watch

535
00:29:57,320 --> 00:29:59,760
Speaker 1: us live on YouTube.

536
00:30:00,040 --> 00:30:01,840
Speaker 2: Well, there's not a lot going on in town today.

537
00:30:01,840 --> 00:30:04,120
Speaker 2: We're waiting to hear from the President on Iran. We've

538
00:30:04,160 --> 00:30:06,560
Speaker 2: got the House on recess. It's pretty quiet in the

539
00:30:06,640 --> 00:30:09,640
Speaker 2: nation's capital. There's some important work that's kicking off here

540
00:30:10,120 --> 00:30:12,440
Speaker 2: in the United States Senate. You hear us talk about

541
00:30:12,480 --> 00:30:15,480
Speaker 2: the bird bath, the bird droppings, the things that might

542
00:30:15,480 --> 00:30:16,520
Speaker 2: not end up in the bill.

543
00:30:16,520 --> 00:30:19,120
Speaker 3: It's getting going now on the Senate Finance.

544
00:30:18,640 --> 00:30:22,360
Speaker 2: Committee's portion of the President's big beautiful bill. And this

545
00:30:22,440 --> 00:30:24,960
Speaker 2: is the tough stuff in many cases, the controversial tax

546
00:30:25,000 --> 00:30:29,440
Speaker 2: related stuff, the medicaid situation. And we're going to get

547
00:30:29,480 --> 00:30:31,240
Speaker 2: into it now with somebody who's been on the other

548
00:30:31,280 --> 00:30:35,040
Speaker 2: side of the bird bath. With our eyes on the Senate.

549
00:30:35,080 --> 00:30:38,920
Speaker 2: We bring in from the House, Patrick McHenry of course,

550
00:30:38,920 --> 00:30:42,120
Speaker 2: former Chair House Financial Services Committee, former Speaker pro temp.

551
00:30:42,120 --> 00:30:46,120
Speaker 2: Bloomberg contributor. Nice to see you, like just me and

552
00:30:46,120 --> 00:30:47,120
Speaker 2: you and the Capitol today.

553
00:30:47,120 --> 00:30:49,760
Speaker 9: It's this fantastic around the place for ourselves.

554
00:30:49,760 --> 00:30:51,560
Speaker 2: Well yeah, and thank you for being here. So there

555
00:30:51,560 --> 00:30:53,600
Speaker 2: are questions about what's going to make the cut. I'm

556
00:30:53,600 --> 00:30:55,440
Speaker 2: going to play you Mike Lawler in a minute, because

557
00:30:55,440 --> 00:30:58,360
Speaker 2: he talked to us on Wednesday about holding the line

558
00:30:58,360 --> 00:30:58,800
Speaker 2: on salt.

559
00:30:58,880 --> 00:31:00,480
Speaker 3: There's a lot of stuff up in the air here.

560
00:31:00,600 --> 00:31:04,920
Speaker 2: The parliamentarian will then have a say, is there anything

561
00:31:05,040 --> 00:31:09,120
Speaker 2: beginning with the current policy baseline that could be massively

562
00:31:09,200 --> 00:31:10,600
Speaker 2: disrupted this weekend?

563
00:31:10,760 --> 00:31:14,080
Speaker 10: Well, I think the current policy baseline is the big

564
00:31:14,120 --> 00:31:17,200
Speaker 10: ancelada and the major decision.

565
00:31:17,080 --> 00:31:18,840
Speaker 9: And there'll be a waterfall off of that.

566
00:31:19,040 --> 00:31:22,200
Speaker 10: Okay, So we're going through a set of procedures that

567
00:31:22,360 --> 00:31:25,240
Speaker 10: every House member hates. So we send over a bill

568
00:31:25,280 --> 00:31:30,200
Speaker 10: that we think conforms with reconciliation, the law that governs

569
00:31:30,200 --> 00:31:33,280
Speaker 10: a reconciliation process. It really doesn't have any bearing on

570
00:31:33,320 --> 00:31:36,000
Speaker 10: the House because we work as a majoritarian institution on

571
00:31:36,040 --> 00:31:37,280
Speaker 10: a daily weekly basis.

572
00:31:37,280 --> 00:31:40,720
Speaker 9: That's what we do. Or they do now, I should say.

573
00:31:40,880 --> 00:31:43,360
Speaker 10: And then in the Senate it's complex because you have

574
00:31:43,760 --> 00:31:48,040
Speaker 10: this cloture threshold, you have these higher standards to do anything.

575
00:31:48,840 --> 00:31:52,800
Speaker 10: The one example of them having a fifty vote fifty

576
00:31:52,840 --> 00:31:58,480
Speaker 10: plus one margin for policy that affects budgeting occurs through

577
00:31:58,480 --> 00:32:02,520
Speaker 10: the reconciliation process. The Senate procedure here puts the power

578
00:32:02,600 --> 00:32:06,680
Speaker 10: to make that decision the parliamentarian and with very rare

579
00:32:06,720 --> 00:32:11,360
Speaker 10: sort with only very rare historic moments, has the parliamentarian been.

580
00:32:11,240 --> 00:32:13,760
Speaker 2: Over rules Aaron McDonough is that the if I remember,

581
00:32:14,400 --> 00:32:17,720
Speaker 2: this is a very unpopular person, highly un you see

582
00:32:17,720 --> 00:32:18,960
Speaker 2: in the elevator.

583
00:32:19,080 --> 00:32:23,640
Speaker 10: Highly unpopular, but also the most popular and right most powerful,

584
00:32:23,760 --> 00:32:24,560
Speaker 10: most powerful.

585
00:32:24,640 --> 00:32:26,400
Speaker 9: So this whole process.

586
00:32:26,040 --> 00:32:27,440
Speaker 3: Has paid for a drink in years.

587
00:32:27,640 --> 00:32:31,440
Speaker 10: No, and this process is one that is deeply adjudicated.

588
00:32:31,840 --> 00:32:35,320
Speaker 10: And the attempt here is to be balanced, balanced over

589
00:32:35,560 --> 00:32:38,160
Speaker 10: the ten and twenty and thirty year basis, not just

590
00:32:38,240 --> 00:32:41,920
Speaker 10: the two year Congress basis. So a lot will be

591
00:32:42,000 --> 00:32:43,920
Speaker 10: pulled out of this bill like it always is in

592
00:32:44,040 --> 00:32:47,160
Speaker 10: every reconciliation package that has happened over the last twenty years.

593
00:32:47,160 --> 00:32:48,160
Speaker 3: How predictable is that?

594
00:32:48,200 --> 00:32:50,760
Speaker 9: Typically it is not predictable?

595
00:32:50,760 --> 00:32:53,400
Speaker 10: Okay, it is not predictable because it's there are a

596
00:32:53,440 --> 00:32:56,840
Speaker 10: lot of performative acts going in a lot of bravado

597
00:32:57,000 --> 00:33:00,200
Speaker 10: of what the policy maker or those that oppose the

598
00:33:00,200 --> 00:33:04,320
Speaker 10: policy I think is the right outcome, which is obviously

599
00:33:04,520 --> 00:33:07,240
Speaker 10: their perspective, not anything connected with the rules.

600
00:33:07,320 --> 00:33:08,640
Speaker 9: It's their whims, their wishes.

601
00:33:09,160 --> 00:33:11,280
Speaker 10: So what comes out of this is less of a

602
00:33:11,280 --> 00:33:14,600
Speaker 10: bill than started. That is historic, that is natural for

603
00:33:14,680 --> 00:33:17,200
Speaker 10: this process, and it will be more frustrating to House

604
00:33:17,240 --> 00:33:21,480
Speaker 10: members what falls out than what stays in, which is

605
00:33:21,480 --> 00:33:24,960
Speaker 10: why you're seeing House members opening about every step.

606
00:33:24,680 --> 00:33:29,120
Speaker 2: That's of the way, as they should so current policy, baseline,

607
00:33:29,120 --> 00:33:32,880
Speaker 2: gut check. The Senate knows this is coming. Surely they've

608
00:33:32,880 --> 00:33:37,600
Speaker 2: been in touch. That would really disrupt this bill.

609
00:33:37,680 --> 00:33:38,360
Speaker 3: Does it stay in?

610
00:33:38,960 --> 00:33:41,200
Speaker 10: I think it stays in. Okay, I think it stays in.

611
00:33:42,160 --> 00:33:44,680
Speaker 10: But these things are very hard to predict. But I

612
00:33:44,760 --> 00:33:45,960
Speaker 10: think unbalanced.

613
00:33:46,000 --> 00:33:46,720
Speaker 9: I think it stays in.

614
00:33:47,320 --> 00:33:51,880
Speaker 10: That also changes the score for certain policy makers. It

615
00:33:51,880 --> 00:33:53,400
Speaker 10: doesn't change the score.

616
00:33:53,160 --> 00:33:54,040
Speaker 9: For Wall Street.

617
00:33:54,080 --> 00:33:57,320
Speaker 10: Wall Street looks at this and says Republicans haven't done

618
00:33:57,400 --> 00:33:59,080
Speaker 10: enough to reduce the debt and dev you know, have

619
00:33:59,720 --> 00:34:04,760
Speaker 10: turned turn the tide on our annual deficits, haven't done

620
00:34:04,760 --> 00:34:08,200
Speaker 10: anything to address the national debt, and that is problematic.

621
00:34:09,360 --> 00:34:11,000
Speaker 10: This is a bill that is by and large a

622
00:34:11,120 --> 00:34:13,040
Speaker 10: tax extension of current code.

623
00:34:13,239 --> 00:34:14,040
Speaker 9: When you take that.

624
00:34:14,080 --> 00:34:17,600
Speaker 10: Out, the deficit reduction package is a very serious one.

625
00:34:17,840 --> 00:34:20,319
Speaker 10: It's not as large as the debt reduction package we

626
00:34:20,320 --> 00:34:23,520
Speaker 10: had two years ago under divided government. It's not as

627
00:34:23,560 --> 00:34:27,160
Speaker 10: large as the divided government debt reduction or a deficit

628
00:34:27,200 --> 00:34:31,440
Speaker 10: reduction package we had under President Obama with Republican leadership.

629
00:34:31,000 --> 00:34:31,480
Speaker 3: Of the House.

630
00:34:32,080 --> 00:34:34,840
Speaker 10: So it is large, it is not a standout in

631
00:34:35,000 --> 00:34:38,800
Speaker 10: historic terms. The larger ones were done in a large

632
00:34:38,800 --> 00:34:39,720
Speaker 10: bipartisan package.

633
00:34:39,719 --> 00:34:43,480
Speaker 2: Would you consider deal breakers here? Next in line might

634
00:34:43,520 --> 00:34:46,080
Speaker 2: be Salt, which is amazing to me that it's come

635
00:34:46,120 --> 00:34:48,480
Speaker 2: to this. But there was a deal, of course in

636
00:34:48,520 --> 00:34:50,640
Speaker 2: the House. If you watch or listen to Bloomberg, you

637
00:34:50,680 --> 00:34:52,680
Speaker 2: already know it's a big story around here.

638
00:34:52,800 --> 00:34:54,000
Speaker 3: Forty thousand dollars.

639
00:34:54,360 --> 00:34:56,319
Speaker 2: It came out of the ways and means Committee at thirty,

640
00:34:56,360 --> 00:34:58,440
Speaker 2: a lot of people thought maybe that's where this would

641
00:34:58,840 --> 00:35:01,520
Speaker 2: settle down. Senate it back at ten. You know, we

642
00:35:01,560 --> 00:35:02,880
Speaker 2: don't know anything about Salt.

643
00:35:03,080 --> 00:35:05,279
Speaker 9: The Senate cares not one, not at all.

644
00:35:06,200 --> 00:35:09,080
Speaker 2: We've learned why there are Republican senators aren't in blue

645
00:35:09,080 --> 00:35:13,000
Speaker 2: states where this matters. Mike Lawler is your former colleague.

646
00:35:13,000 --> 00:35:15,920
Speaker 2: Talk to us about this on Wednesday, because the position

647
00:35:15,960 --> 00:35:18,359
Speaker 2: of the Salt Caucus is over my dead body, right.

648
00:35:18,440 --> 00:35:21,839
Speaker 2: I'm a no vote, not a dime less. Here's Mike

649
00:35:21,920 --> 00:35:22,920
Speaker 2: Lawler on Bloomberg.

650
00:35:23,920 --> 00:35:27,080
Speaker 5: The Senate needs to recognize they can make changes, they

651
00:35:27,080 --> 00:35:30,960
Speaker 5: can enter into negotiations. But the fact that you need

652
00:35:30,960 --> 00:35:33,200
Speaker 5: two hundred and eighteen votes to pass this in the House,

653
00:35:33,680 --> 00:35:36,400
Speaker 5: and there is not a chance in hell that this

654
00:35:36,440 --> 00:35:40,839
Speaker 5: bill will pass at ten thousand dollars, let alone less

655
00:35:40,840 --> 00:35:45,120
Speaker 5: than forty thousand. I guess people, you know, want to

656
00:35:45,120 --> 00:35:48,080
Speaker 5: try and call our bluff. They tried that in the House.

657
00:35:48,120 --> 00:35:51,440
Speaker 5: They tried to jam us, and we didn't fold.

658
00:35:52,680 --> 00:35:55,440
Speaker 2: Not a chance in hell. This has turned out to

659
00:35:55,520 --> 00:35:59,480
Speaker 2: be one of the most influential groups in the House

660
00:35:59,560 --> 00:36:04,040
Speaker 2: because the Donald Trump can't primary Representative Lawlor with a

661
00:36:04,040 --> 00:36:05,160
Speaker 2: MAGA candidate, can he.

662
00:36:05,360 --> 00:36:09,120
Speaker 10: Well, Also, these candidates can't go back and campaign as

663
00:36:09,120 --> 00:36:13,120
Speaker 10: a Republican that they raise their constituents taxes, which is

664
00:36:13,160 --> 00:36:14,759
Speaker 10: effectively what this is.

665
00:36:14,840 --> 00:36:17,000
Speaker 3: But if he votes know on the bill, he will raise.

666
00:36:17,000 --> 00:36:18,879
Speaker 10: Well no, But if he votes know on the bill,

667
00:36:18,920 --> 00:36:21,080
Speaker 10: there is no bill to go to the President's desk.

668
00:36:21,200 --> 00:36:25,399
Speaker 2: Therefore taxs Trump tax cuts expire and everyone gets a hike.

669
00:36:25,440 --> 00:36:29,120
Speaker 10: Though well, but this is also June. We're still in

670
00:36:29,160 --> 00:36:31,839
Speaker 10: the month of June. There's a lot of runway here

671
00:36:31,880 --> 00:36:34,280
Speaker 10: before now in the end of the year. The President

672
00:36:34,320 --> 00:36:37,200
Speaker 10: wants this bill as quickly as possible to his desk.

673
00:36:37,920 --> 00:36:40,360
Speaker 10: The end of July has been sort of the natural deadline.

674
00:36:40,440 --> 00:36:42,680
Speaker 10: July fourth is what the White House is saying. I

675
00:36:42,760 --> 00:36:45,680
Speaker 10: think if you see the Senate pass this bill by

676
00:36:46,400 --> 00:36:49,800
Speaker 10: this time next week, or they're in the final landing

677
00:36:49,920 --> 00:36:52,359
Speaker 10: path for the final votes on this by this time

678
00:36:52,400 --> 00:36:55,799
Speaker 10: next week, the House will be kept into session. It

679
00:36:55,840 --> 00:36:59,560
Speaker 10: will be kept in session by President Trump and Speaker Johnson, and.

680
00:36:59,520 --> 00:37:01,120
Speaker 9: The demand will be to take it up and.

681
00:37:01,120 --> 00:37:04,359
Speaker 10: Pass it to the presence vote, which means I think

682
00:37:04,440 --> 00:37:07,040
Speaker 10: the Senate will come to a compromise that the Salt

683
00:37:07,040 --> 00:37:11,000
Speaker 10: Caucus will agree to that is above ten thousand dollars.

684
00:37:11,120 --> 00:37:13,520
Speaker 10: It may not be perfectly forty thousand dollars, it may

685
00:37:13,520 --> 00:37:15,399
Speaker 10: not be every stitch of the policy of the House,

686
00:37:15,760 --> 00:37:17,440
Speaker 10: but the Senate will have to come to terms to

687
00:37:17,480 --> 00:37:20,279
Speaker 10: fix the House's problem. If the President's going to get

688
00:37:20,320 --> 00:37:23,640
Speaker 10: a desk, have built to the desk before what happens.

689
00:37:23,280 --> 00:37:26,160
Speaker 2: In the meantime to the Ron Johnson's Rand Paul's does

690
00:37:26,200 --> 00:37:27,279
Speaker 2: the President write them off?

691
00:37:27,280 --> 00:37:28,880
Speaker 3: He can lose a couple, right, you can.

692
00:37:28,760 --> 00:37:29,360
Speaker 9: Lose a couple.

693
00:37:29,440 --> 00:37:32,640
Speaker 10: But you know, Rand Paul's taking himself out of the game.

694
00:37:32,680 --> 00:37:34,520
Speaker 10: He says it will not vote for it because he

695
00:37:34,600 --> 00:37:36,320
Speaker 10: includes the death citaling increase.

696
00:37:36,400 --> 00:37:36,799
Speaker 9: He's out.

697
00:37:37,840 --> 00:37:41,360
Speaker 10: But there's still a pathway without Ron Johnson. That that

698
00:37:41,680 --> 00:37:43,840
Speaker 10: means you, I actually have a deficit reduction package and

699
00:37:43,880 --> 00:37:46,879
Speaker 10: a clean tax extension. There's a lot of wiggle room

700
00:37:47,040 --> 00:37:51,640
Speaker 10: that all these senators are providing for themselves save Rand Paul.

701
00:37:52,560 --> 00:37:55,120
Speaker 10: And I think you're going to see policymakers trying to

702
00:37:55,160 --> 00:37:59,480
Speaker 10: move these policies to a sufficient to a sufficient happy

703
00:37:59,520 --> 00:38:01,480
Speaker 10: point for the m that they can vote for it.

704
00:38:01,719 --> 00:38:02,800
Speaker 9: They want to be for this.

705
00:38:02,960 --> 00:38:05,479
Speaker 10: They do not want to stand up, stand up, stayd

706
00:38:05,480 --> 00:38:07,960
Speaker 10: in favor of attacks increase. And there's a lot of

707
00:38:08,000 --> 00:38:09,919
Speaker 10: pressure that the President is bringing to bear.

708
00:38:09,960 --> 00:38:11,840
Speaker 2: I want to ask you about Crypto because he could

709
00:38:11,840 --> 00:38:14,200
Speaker 2: put some pressure on House members on this too.

710
00:38:14,160 --> 00:38:15,560
Speaker 3: Right, the Genius Act.

711
00:38:15,920 --> 00:38:17,960
Speaker 2: I've thought about you when that past I wondered what

712
00:38:18,000 --> 00:38:19,919
Speaker 2: you were thinking, because that was a pretty big deal,

713
00:38:19,960 --> 00:38:22,040
Speaker 2: and with all the noise about Iran and everything happening,

714
00:38:22,080 --> 00:38:24,880
Speaker 2: which is clearly critical and very important, it might not

715
00:38:24,920 --> 00:38:26,360
Speaker 2: have gotten the coverage that it deserved.

716
00:38:26,719 --> 00:38:27,360
Speaker 3: But I'll tell you what.

717
00:38:27,400 --> 00:38:30,240
Speaker 2: We sat here in this very room on the same program,

718
00:38:30,320 --> 00:38:34,400
Speaker 2: talked to Senator Elizabeth Warren and Senator also Brooks, two

719
00:38:34,480 --> 00:38:38,400
Speaker 2: Democrats who have very different takes on this. Senator Also

720
00:38:38,440 --> 00:38:41,799
Speaker 2: Brooks is trying to make the case for crypto that

721
00:38:41,880 --> 00:38:46,640
Speaker 2: it is about more than criminals. Will the Elizabeth Warrens

722
00:38:46,640 --> 00:38:48,160
Speaker 2: in the House accept that argument?

723
00:38:48,480 --> 00:38:48,560
Speaker 6: Uh?

724
00:38:48,840 --> 00:38:50,880
Speaker 10: No, I think what we're talking about is a serious

725
00:38:50,880 --> 00:38:55,720
Speaker 10: policymakers new to the Senate, and somebody who has created

726
00:38:55,719 --> 00:38:59,040
Speaker 10: an avenue to be a gadfly on policy rather than

727
00:38:59,080 --> 00:39:02,319
Speaker 10: a participant in policy making. And so the substance of

728
00:39:02,360 --> 00:39:05,839
Speaker 10: issue here is that we have, for things that are

729
00:39:05,840 --> 00:39:08,759
Speaker 10: called a stable coin, no federal definition of what that is.

730
00:39:09,080 --> 00:39:12,960
Speaker 10: Only state regulation of stable coins we have. We have

731
00:39:13,760 --> 00:39:17,200
Speaker 10: no requirement for us to have audited financials, no federal

732
00:39:17,280 --> 00:39:22,759
Speaker 10: oversight of this substantial product that is really rising in use,

733
00:39:22,840 --> 00:39:27,560
Speaker 10: in utility, with hundreds of billions of dollars of flow

734
00:39:27,600 --> 00:39:31,520
Speaker 10: through stable coins now and no federal regulatory regime. So

735
00:39:31,640 --> 00:39:34,239
Speaker 10: you would think that the party that favors more regulation

736
00:39:34,400 --> 00:39:37,480
Speaker 10: generally Democrat. The Democratic Party would say we didn't have

737
00:39:37,520 --> 00:39:41,839
Speaker 10: some say here, you had sixty eight votes in the

738
00:39:41,880 --> 00:39:44,720
Speaker 10: Senate to pass the Genius Act to provide a federal

739
00:39:44,760 --> 00:39:48,000
Speaker 10: regulatory perimeter on things called stable coins.

740
00:39:48,760 --> 00:39:49,800
Speaker 9: It's a simple bill.

741
00:39:49,640 --> 00:39:53,520
Speaker 10: Frankly, that we passed out of committee two years ago.

742
00:39:54,000 --> 00:39:55,600
Speaker 10: At this time out of the House representative.

743
00:39:55,680 --> 00:39:58,680
Speaker 2: Is the fear that Donald Trump runs wild making money

744
00:39:58,680 --> 00:40:00,000
Speaker 2: on crypto, doesn't crack.

745
00:39:59,840 --> 00:40:01,359
Speaker 3: Down on Trump enough?

746
00:40:01,480 --> 00:40:05,120
Speaker 2: Or is the fear that this unlocks the Clarity Act

747
00:40:05,120 --> 00:40:08,160
Speaker 2: the new fit No, I feel that that brings us

748
00:40:08,320 --> 00:40:09,840
Speaker 2: to bear when it comes to bitcoin.

749
00:40:09,960 --> 00:40:14,239
Speaker 10: I think you have you have a partisan Democratic senators

750
00:40:13,800 --> 00:40:15,959
Speaker 10: and in the House, so in.

751
00:40:15,840 --> 00:40:18,799
Speaker 3: Some cases previously approved of this list.

752
00:40:18,880 --> 00:40:22,280
Speaker 10: Yes, And the optics around President Trump's family being engaged

753
00:40:22,320 --> 00:40:25,839
Speaker 10: in crypto has told them that they're out and they's

754
00:40:26,000 --> 00:40:28,560
Speaker 10: and it's really a hot button political issue that they

755
00:40:28,560 --> 00:40:32,640
Speaker 10: don't want to touch. These bills address those issues. The

756
00:40:33,000 --> 00:40:36,720
Speaker 10: question of public office holders owning crypto can be addressed

757
00:40:36,719 --> 00:40:41,200
Speaker 10: separately in regular and regulation and legislation. It shouldn't stop

758
00:40:42,080 --> 00:40:44,719
Speaker 10: you know, a nineteen thirty three and nineteen thirty four

759
00:40:44,960 --> 00:40:50,080
Speaker 10: Securities and Seriity Exchange Act type of legislation for crypto

760
00:40:50,480 --> 00:40:53,720
Speaker 10: to take hold. It shouldn't stop us regulating financial products

761
00:40:53,719 --> 00:40:57,319
Speaker 10: at the federal level because you see, you see what

762
00:40:57,440 --> 00:41:01,720
Speaker 10: Democratic members see is bad act within the Trump family

763
00:41:01,760 --> 00:41:06,080
Speaker 10: on this stuff. That shouldn't inhibit legislation, but it did

764
00:41:06,160 --> 00:41:09,040
Speaker 10: pull some Senators off or give them justification to be

765
00:41:09,040 --> 00:41:13,360
Speaker 10: a no because they're already anti crypto. The big news here, though,

766
00:41:13,520 --> 00:41:16,200
Speaker 10: is it is a major bipartison milestone for the Senate

767
00:41:16,600 --> 00:41:19,879
Speaker 10: to take up crypto Legislation number one and number two

768
00:41:20,200 --> 00:41:24,480
Speaker 10: the Senate Banking Committee has produced, now it's second piece

769
00:41:24,520 --> 00:41:29,240
Speaker 10: of major legislation since the Financial crisis since Dodd Frank.

770
00:41:29,760 --> 00:41:32,560
Speaker 10: The Senate Banking Committee has passed Senate Built twenty one

771
00:41:32,600 --> 00:41:35,000
Speaker 10: to fifty five, which was a revision to Dodd Frank

772
00:41:35,120 --> 00:41:38,920
Speaker 10: modest in nature that became law. And now stable coins.

773
00:41:39,160 --> 00:41:43,200
Speaker 10: They've done two major things since Dodd Frank passage. I

774
00:41:43,200 --> 00:41:46,279
Speaker 10: think that we should herald because it's serious policy making,

775
00:41:46,320 --> 00:41:49,120
Speaker 10: a serious undertaking from a serious committee, and we should

776
00:41:49,160 --> 00:41:52,080
Speaker 10: welcome that as a functioning piece of government and commend

777
00:41:52,120 --> 00:41:54,800
Speaker 10: everybody who wanted to participate and get to a good outcome.

778
00:41:54,920 --> 00:41:57,040
Speaker 2: Well, it did take Democrats to pass it in the Senate.

779
00:41:57,040 --> 00:41:58,680
Speaker 2: We'll see what happens on the House side. I want

780
00:41:58,680 --> 00:42:00,680
Speaker 2: to ask you about it Ron and our couple of

781
00:42:00,680 --> 00:42:03,759
Speaker 2: moments here, because the president's facing a major decision and

782
00:42:03,800 --> 00:42:06,480
Speaker 2: you've been involved or were in your time as a

783
00:42:06,480 --> 00:42:09,800
Speaker 2: member of Congress in debates around authorizing use of force.

784
00:42:10,239 --> 00:42:13,600
Speaker 2: In some cases they were bent into pretzels to keep

785
00:42:13,640 --> 00:42:16,719
Speaker 2: them working in places like Iran in Afghanistan. At what

786
00:42:16,800 --> 00:42:19,680
Speaker 2: point will Congress need to have a say in something

787
00:42:19,719 --> 00:42:21,400
Speaker 2: if the president decides to take action.

788
00:42:21,320 --> 00:42:23,839
Speaker 9: Well, it depends how significant actions.

789
00:42:23,520 --> 00:42:26,239
Speaker 2: Is thirty to sixty days typically, is there more to

790
00:42:26,320 --> 00:42:26,920
Speaker 2: it than that it is?

791
00:42:26,960 --> 00:42:29,359
Speaker 10: And it depends how lasting this action is. If you're

792
00:42:29,360 --> 00:42:32,360
Speaker 10: talking about regime change, I think that is a significant shaker.

793
00:42:32,400 --> 00:42:35,920
Speaker 10: That's why you see skepticism on MAGA loyalists that one

794
00:42:36,040 --> 00:42:38,840
Speaker 10: is pulling back from the world, and they're saying, do

795
00:42:38,920 --> 00:42:40,800
Speaker 10: not get into the question of regime change.

796
00:42:40,840 --> 00:42:43,640
Speaker 9: We saw what happened in Iraq. We need to learn

797
00:42:43,680 --> 00:42:44,360
Speaker 9: our lessons.

798
00:42:44,680 --> 00:42:44,839
Speaker 7: Now.

799
00:42:44,880 --> 00:42:47,239
Speaker 10: The question is what are those measures that we can

800
00:42:47,280 --> 00:42:50,880
Speaker 10: take to stop Rand's nuclear program? Can we be of

801
00:42:51,000 --> 00:42:53,320
Speaker 10: aid and assistance to Israel like it appears what we

802
00:42:53,360 --> 00:42:57,400
Speaker 10: currently are. Should we ramp that up a degree or

803
00:42:57,560 --> 00:43:01,200
Speaker 10: fifty degrees depending on your perspective. There is a divide

804
00:43:01,800 --> 00:43:05,160
Speaker 10: among President Trump's loyalists on this on what is the

805
00:43:05,239 --> 00:43:07,720
Speaker 10: right approach. I think what we're going to see here

806
00:43:07,920 --> 00:43:10,880
Speaker 10: is a Trump doctrine that comes as a result of

807
00:43:10,920 --> 00:43:14,920
Speaker 10: that that is neither isolationist nor fully engaged in the

808
00:43:14,960 --> 00:43:15,880
Speaker 10: international community.

809
00:43:15,920 --> 00:43:18,000
Speaker 3: Fascinating. You think we find out in less than two weeks.

810
00:43:18,160 --> 00:43:20,440
Speaker 9: I think we find out within days.

811
00:43:20,920 --> 00:43:21,520
Speaker 3: Fascinating.

812
00:43:21,920 --> 00:43:25,480
Speaker 2: Always great to see you, Patrick McHenry, Bloomberg Politics contributor,

813
00:43:25,560 --> 00:43:28,520
Speaker 2: of course, former chair of the House Financial Services Committee,

814
00:43:28,760 --> 00:43:30,920
Speaker 2: a man who's held the Gabalis, former Speaker pro ten.

815
00:43:30,960 --> 00:43:32,160
Speaker 3: Great to see you. Thank you so much.

816
00:43:32,200 --> 00:43:34,319
Speaker 2: As always, I'm Joe, Matthew and Washington will meet you

817
00:43:34,360 --> 00:43:37,120
Speaker 2: back here on the five PM late edition of Balance

818
00:43:37,200 --> 00:43:44,200
Speaker 2: of Power on Bloomberg. Thanks for listening to the Balance

819
00:43:44,200 --> 00:43:47,840
Speaker 2: of Power podcast. Make sure to subscribe if you haven't already,

820
00:43:47,880 --> 00:43:51,200
Speaker 2: at Apple, Spotify, or wherever you get your podcasts, and

821
00:43:51,239 --> 00:43:53,839
Speaker 2: you can find us live every weekday from Washington, DC

822
00:43:54,000 --> 00:43:56,720
Speaker 2: at noontime Eastern at bloomberg dot com,