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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: Happy Monday to you as we kick off this new

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Speaker 2: week in Washington with our eyes specifically on what's happening

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Speaker 2: in London another round of trade negotiations between the world's

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Speaker 2: two largest economies, the US and China. Remembering that an

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Speaker 2: agreement was struck in Geneva last month to lower tariffs

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Speaker 2: for ninety days, but it was a little bit fuzzy

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Speaker 2: as to what else was part of that agreement, specifically

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Speaker 2: what China was committing to in unrestricting exports of critical

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Speaker 2: minerals to the United States. President Trump got Shijin Ping

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Speaker 2: on the phone last week to try to clear that up,

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Speaker 2: and of course they're working on hammering out those fine

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Speaker 2: details as we speak, the principles right now now at

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Speaker 2: this hour, Joe still gathered in London.

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Speaker 3: That was a perfect setup in Bloomberg's and Marie Hordern

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Speaker 3: is actually at the scene to carry the ball under

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Speaker 3: what happens next? Bloomberg's chief political correspondent outside that meeting

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Speaker 3: and Marie, how's it going inside?

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Speaker 4: Well, they just arrived five hours ago and they are

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Speaker 4: still at the negotiating table. About half hour ago we

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Speaker 4: actually saw food delivery being brought in, So they plan,

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Speaker 4: I think, on spending a few more hours here in London.

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Speaker 4: Just past six pm, so these talks are bleeding into

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Speaker 4: the evening and potentially even till into tomorrow. What we

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Speaker 4: do know from earlier the NEC director Kevin Hassett talking

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Speaker 4: about the fact the contours potentially of this deal easing

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Speaker 4: some export controls that the United States has in place

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Speaker 4: for semiconductors going to China, and then on the Chinese side,

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Speaker 4: the US wants to see more licenses when it comes

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Speaker 4: to rare earths and magnets. They want to see an

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Speaker 4: advanced pace that they thought they agreed upon in Geneva.

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Speaker 4: The issue, of course, is what are the red lines

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Speaker 4: for both of these economies. For China, it's clearly getting

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Speaker 4: their hands on these advanced semiconductors, but how far is

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Speaker 4: the United States willing to go? Say, are they willing

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Speaker 4: to use potentially the h twenty Nvidia chips as a

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Speaker 4: negotiating chip, and when it comes to China, how quickly

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Speaker 4: are they really going to ramp up those rare earths?

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Speaker 4: And I think what this shows you is that we

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Speaker 4: are just four weeks out for when these two delegations

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Speaker 4: met in Geneva. It just shows you how difficult trade

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Speaker 4: negotiations are and reminds us all of how difficult it

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Speaker 4: was for the purchasing agreement in Trump's first administration. That

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Speaker 4: trade war started in twenty eighteen and a deal wasn't

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Speaker 4: in place until twenty twenty.

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Speaker 2: Well, when we consider who was in the room today,

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Speaker 2: Anne Marie obviously, Holy Funk and Scott Best and Howard

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Speaker 2: Lutnik are all there. Very high level talks are taking place,

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Speaker 2: But it was President Trump communicating directly with Xijinping by

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Speaker 2: phone for the first time since assuming office for his

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Speaker 2: second term that got our attention and the idea as

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Speaker 2: to the extent to which this sets the stage for

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Speaker 2: a face to face meeting between the two upmost leaders, Well.

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Speaker 4: That phone call definitely broke the ICE member Secretary Besson,

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Speaker 4: after the Geneva talks a few weeks after, said that

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Speaker 4: he felt like negotiations were stalling. There was a phone

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Speaker 4: call and that really led to the path to have

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Speaker 4: this discussion today in London. On that phone call, though,

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Speaker 4: the two leaders did discuss visiting each other. So President

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Speaker 4: Shishiping invited President Trump and the First Lady to China,

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Speaker 4: and then President Trump reciprocated as well. So potentially that

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Speaker 4: could be a deliverable or something that at minimum is

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Speaker 4: discussed at this meeting. Also, Kayleie, it's a great point

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Speaker 4: to mention that Commerce Secretary Howard Lutnik is here. He

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Speaker 4: was not there in Geneva. He's in addition to this meeting,

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Speaker 4: and I think that just basically tells everyone that maybe

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Speaker 4: we don't know how far the US is willing to go,

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Speaker 4: but easing of export controls is on the table.

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Speaker 3: Fascinating stuff, Anne Marie. We have to be honest that

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Speaker 3: we're still biting around the edges of a much larger

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Speaker 3: potential deal here when it comes to tariffs, and I

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Speaker 3: know we're looking at a deadline in August on that

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Speaker 3: would it be a win for this to resolve to

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Speaker 3: another greater meeting on tariffs reciprocal tariffs against China.

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Speaker 4: Yeah, definitely, potentially, I think they would love to wrap

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Speaker 4: this up before August, right, because they're also dealing with

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Speaker 4: a ton of other countries. The issue is, to your point, show,

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Speaker 4: is that these are just two issues at the heart

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Speaker 4: of a very bigger deal. When I spoke to the

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Speaker 4: Treasury Secretary weeks ago, he had talked about how they

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Speaker 4: don't want to decouple from China. There is a grand

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Speaker 4: deal to be had. Of course, the issue is each

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Speaker 4: country has red lines, and the other country is trying

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Speaker 4: to get past those red lines. And the problem is,

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Speaker 4: if you're in the United States and you care about

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Speaker 4: national security concerns, there's a potential limit that you're willing

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Speaker 4: to go and give to China, and then China is

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Speaker 4: going to use what their leverage is, say, in this instance,

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Speaker 4: rare Earth. So this goes beyond just trade. This has

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Speaker 4: to do with national security issues as well. And to

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Speaker 4: think that potentially they can get this done in August,

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Speaker 4: I think is very optimistic given the fact that what

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Speaker 4: we saw just from a purchasing agreement of agricultural products

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Speaker 4: by large, took over a year during Trump's first administration.

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Speaker 2: All Right, Bloomberg's and Marie Hordorner, chief political correspondent, live

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Speaker 2: in London on the scene for these talks. Thank you

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Speaker 2: so much, and we want to get more context and

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Speaker 2: analysis now as we turn to Nazac Nacochtyar here on

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Speaker 2: Bloomberg TV and Radio. She's National Security Practice Group lead

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Speaker 2: at Wiley Ryan, also former Assistant Secretary for Industry and

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Speaker 2: Analysis at the International Trade Administration. Nazak, welcome back to

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Speaker 2: balance of power as we consider what the US may

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Speaker 2: be willing to give here in these talks with China

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Speaker 2: taking place today, a rolling back of export controls that

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Speaker 2: have been concertedly part of an effort for the US

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Speaker 2: to restrain China's technological development. Where do you expect the

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Speaker 2: line to be drawn? Are we really about to give

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Speaker 2: them access to things that can help them develop the

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Speaker 2: advanced semiconductors that we have been purposefully trying to make

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Speaker 2: sure they cannot do successfully.

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Speaker 5: Yeah, Klian, Joe, great to be with you. Look, this

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Speaker 5: is an incredibly complex issue, and it underscores a really

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Speaker 5: important point, the fact that we have become so dependent

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Speaker 5: on elements like critical minerals and the permanent magnets we

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Speaker 5: need for our commercial sector, our defense sector, so much

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Speaker 5: so that we actually have to give up a really

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Speaker 5: important national security concerns, including dual use items. And I

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Speaker 5: really want to stress the definition of dual use. Dual

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Speaker 5: use items that China is seeking us to relax our

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Speaker 5: expert controls on are various types of AI chips, various

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Speaker 5: types of chips in general aerospace engine technology, and these

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Speaker 5: are dual use because of course they have commercial applications,

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Speaker 5: but they have enormous military applications, so much so that

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Speaker 5: the government has decided to restrict them in the first place.

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Speaker 5: So can you imagine this scenario where because of our

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Speaker 5: import vulnerabilities due to China supply chains, we actually have

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Speaker 5: to give up some of our critical national security concerns.

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Speaker 5: The Trump administration is going to try to keep the

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Speaker 5: wallop as much as they can and not give in

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Speaker 5: to some of these China's demands. But the Chinese are

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Speaker 5: going to double down. It's going to be terraff production,

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Speaker 5: export control relaxation, and then potentially something about Taiwan, as

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Speaker 5: China has signaled in the past.

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Speaker 3: This is where I start to get a bit confused. Zaka,

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Speaker 3: It's great to have you back. If this is in

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Speaker 3: fact a national security concern, why is it on the

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Speaker 3: bargaining table?

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Speaker 6: You know.

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Speaker 5: That's really because we are dependent on some critical supply

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Speaker 5: chains from China that are also impacting our national security concerns.

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Speaker 5: Rarers that you all were just talking about, permanent magnets. Again,

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Speaker 5: these are things that China controls exclusively, the supply chain,

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Speaker 5: and in order, I think some folks in the administration believe,

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Speaker 5: in order to get our defund sector up and running,

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Speaker 5: the commercial sector up and running with these magnets that

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Speaker 5: we need, we're going to have to give some things up.

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Speaker 5: The other interesting aspect of this that makes it extraordinarily

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Speaker 5: complicated is our import dependence is just goods from China,

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Speaker 5: which China seeking from us is actually the know how

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Speaker 5: in technology. That know how in technology that I hope

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Speaker 5: we don't give up to China and we maintain our

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Speaker 5: export controls that's long lasting. Once you transfer technology to China,

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Speaker 5: it's gone, you know. But China can always turn around

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Speaker 5: and stop the exports of the things that we need,

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Speaker 5: the magnets, the pharmaceuticals to us at any time. And

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Speaker 5: that's what I'm concerned about. Even if there's a handshake deal,

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Speaker 5: even despite China's history of not adhering to deals, even

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Speaker 5: if we get something they can turn around tomorrow and

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Speaker 5: block our access when versus having given up technology that

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Speaker 5: now China can keep forever.

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Speaker 6: China.

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Speaker 2: Well, nawzak one could listen to you and think that

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Speaker 2: China is actually the one with all the leverage here.

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Speaker 2: If they have a choke hold on this market that

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Speaker 2: we need for our national security, if it's them that

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Speaker 2: have the ability to just turn it on and off

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Speaker 2: like a light switch, what hand does the US really have?

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Speaker 6: You know?

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Speaker 5: I think the US, if they really want to play

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Speaker 5: it strongly, they can and not give up too much.

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Speaker 5: And the pharmaceutical sector one of the secrets we have

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Speaker 5: to know how to make the drugs. I don't think

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Speaker 5: we're as vulnerable as you know some may think we are.

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Speaker 5: And in terms of magnets, I mean, let's remember we

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Speaker 5: are having we have a huge magnet supply chain that's growing.

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Speaker 5: We have light rare earthen in California, heavy wearers in Canada,

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Speaker 5: a number of magnet producers who invested in the United

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Speaker 5: States are growing. But let's also remember we can reuse magnets.

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Speaker 5: We can take magnets out of phones, out of autos,

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Speaker 5: out of defense equipment, and barely just basically remagnetize them

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Speaker 5: and reuse them. And the reason I say all that

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Speaker 5: is because sure it takes time to scale what we're

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Speaker 5: building our own domestic supply chain, but we're not at

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Speaker 5: a loss. We can reuse what we currently have, and

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Speaker 5: that gives us so much leverage to stay strong, to

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Speaker 5: not give into China's demands because we're not as dependent

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Speaker 5: as a Chinese like to think that we are.

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Speaker 3: Sounds like a good time to short magnets, Zach, I

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Speaker 3: wonder to what extent Jensen Wang will help to influence

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Speaker 3: the outcome of this question, specifically over export controls and

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Speaker 3: semic conductors. He's got the President's here. We know they

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Speaker 3: have a relationship. He's been to the White House and

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Speaker 3: he talked a lot just a couple of weeks ago

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Speaker 3: about how these building blocks for AI should in fact

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Speaker 3: be based on American systems, even if it's AI companies

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Speaker 3: in China that are doing the work, that the American

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Speaker 3: building block should be in place. If that's the case,

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Speaker 3: we're about to see a loosening of export controls for

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Speaker 3: the better. Correct.

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Speaker 5: Well, we're in a situation where are so many of

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Speaker 5: our companies are now just developing and have been for

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Speaker 5: a number of years, so much revenue from China that

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Speaker 5: cutting off access to that market could be pretty much

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Speaker 5: short term, in their view, catastrophic for them. At the

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Speaker 5: same time, again, they're asking the US government to continue

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Speaker 5: the exports of dual use items that are aiding and

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Speaker 5: abtting Chinese military. Even if we the United States have

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Speaker 5: built massive data centers in China, the Chinese are using

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Speaker 5: those data centers for AI capabilities that augment their military.

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Speaker 5: And the way China plays is if you build it

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Speaker 5: in China, you have to transfer technology to China. To me,

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Speaker 5: it's a high risk proposition that we'll continuing to transfer

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Speaker 5: all of our technology to China when China just doubles down,

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Speaker 5: pours more money into it to indigenize it and more

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Speaker 5: people and resources. We saw what happened with deep Sea.

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Speaker 5: We've saw what's happened over the last fifteen years. China

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Speaker 5: has accelerated its growth in technology from virtually being a

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Speaker 5: really sort of developed country, not technologically advanced at all,

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Speaker 5: to the technological powerhouse that it is today. And that

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Speaker 5: is because we've been transferring our technology. And I think

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Speaker 5: it's really time for the Trump administration to one take

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Speaker 5: a second look as whether we want to give up

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Speaker 5: more and to remember that we're not as dependent as

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Speaker 5: some think we are.

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Speaker 2: Well so, Nazuch when we consider the time here for

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Speaker 2: these very complex issues to be fully worked out. I

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Speaker 2: don't know the extent to which you expect there to

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Speaker 2: be firm, tangible outcomes of this meeting in Geneva, but

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Speaker 2: knowing we are up against a deadline in August here

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Speaker 2: of this ninety day window in which tariff levels have

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Speaker 2: been brought down from the astronomical highs with which they were,

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Speaker 2: is that enough time for the US and China to

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Speaker 2: really get into the nuances of all of this different

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Speaker 2: policy or we're just going to have to keep buying

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Speaker 2: ourselves more and more extensions.

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Speaker 5: You know, I think the likelihood that they're going to

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Speaker 5: get out with you know, they're going to leave with

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Speaker 5: a handshake deal is very likely. I think we're going

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Speaker 5: to end up reducing some of our controls, maybe on chips,

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Speaker 5: chip technology, AI chip technology, the commercial aircraft engines that

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Speaker 5: we've recently prohibited the exports to China, and you know what,

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Speaker 5: China is basically going to say, fine, you can have

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Speaker 5: more magnets, but China is probably not going to allow

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Speaker 5: our military sector to have magnets for our defense and

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Speaker 5: weapons systems. And you know, what good is a handshake

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Speaker 5: deal when we have a country like China that's systematically

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Speaker 5: broken deals wto commitments. It's bilateral you know, cybersecurity deal

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Speaker 5: in twenty fifteen, Phase one deal, the Geneva deal. So yes,

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Speaker 5: I think from China's perspective, it's going to give in.

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Speaker 5: You know, after a little bit of acting tough, it'll

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Speaker 5: give in a little bit. It'll say, fine, I'm going

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Speaker 5: to license these things to you. We're going to reduce

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Speaker 5: our expert controls. And I am confident that within a

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Speaker 5: month we're going to find ourselves in a very similar

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Speaker 5: situation not getting the things that we need from China.

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Speaker 5: And then it's going to be a really tough call

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Speaker 5: for what the administration is going to do next.

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Speaker 3: Sounds like reciprocal tariffs are not going away anytime soon.

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Speaker 5: I think that they're going to stay. And look, they

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Speaker 5: were having a real dire impact on the Chinese economy

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Speaker 5: when they're in the high double digits and triple digits.

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Speaker 5: And I think that if the Trunk administration really wanted

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Speaker 5: to bring China to its knees. I could have kept

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Speaker 5: the tariffs on for slightly longer. Of course, that also

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Speaker 5: adversely impacted American industries. I think we're going to be

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Speaker 5: doing the song and dance for many, many months ahead

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Speaker 5: until one of the countries canpeculates.

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Speaker 3: Zok. Great to have you back to Zokacock to our

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Speaker 3: National Security Practice Group leader Wiley rain LLP, former Assistant

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Speaker 3: Secretary for Industry and Analysis at the International Trade Administration.

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Speaker 3: That was a great conversation. Kaylee will find out maybe

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Speaker 3: by the end of the day if we get a

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Speaker 3: readout from either of these teams on what happened. But

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Speaker 3: Anne Marie says they're bringing in takeout. This may not

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Speaker 3: end anytime soon.

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Speaker 2: Yeah, that's never a good sign if you're looking for

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Speaker 2: something to wrap up quickly when they bring the extra

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Speaker 2: nourishment in. But we'll continue to keep you updated on

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Speaker 2: what's happening in London and what's happening in Los Angeles.

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Speaker 2: That's where we turn to next, is we consider President

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Speaker 2: Trump deploying the National Guard without the say so of

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Speaker 2: California's Governor Gavin Newsom.

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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. E's durn

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Speaker 1: on Apple Cocklay and Android Auto with the Bloomberg Business app.

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Speaker 1: You can also listen live on Amazon Alexa from our

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

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Speaker 3: We all started our day listening to the same conversation.

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Speaker 3: When I heard Tom Keene was going to be interviewing

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Speaker 3: Andrew Cuomo, I canceled my plans at nine o'clock on

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Speaker 3: a Monday morning, fascinating back and forth here in a

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Speaker 3: conversation you would only hear on Bloomberg, and of course

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Speaker 3: took on a very different direction. Following the protests that

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Speaker 3: we saw in LA not just the protests over the weekend,

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Speaker 3: but the clashes with police. President Trump's decision to send

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Speaker 3: in the National Guard, the Secretary of Defense's threat to

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Speaker 3: mobilize Marines from Camp Pendleton. Donald Trump just on truth

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Speaker 3: Socialist short time ago. It was a great decision, he says,

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Speaker 3: to send the National Guard to California. If we had

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Speaker 3: not done so, Los Angeles would have been completely obliterated.

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Speaker 3: Now knowing that Andrew Cuomo is running for mayor, He's

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Speaker 3: of course got his own ideas about a Republican president

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Speaker 3: sending National Guard troops the streets of a major American city.

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Speaker 3: Listen to Andrew Cuomo earlier on Bloomberg.

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Speaker 7: This gets into President Trump's strategy, I believe and look,

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Speaker 7: first of all, on the immigration issue, he's very clear

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Speaker 7: in his campaign he believes it's an issue that works

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Speaker 7: for him. During the campaign, he said he was going

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Speaker 7: to deport criminals, dangerous criminals, dangerous criminals, and everybody said, yes,

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Speaker 7: support dangerous criminals. Of course, now we're deporting seven year

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Speaker 7: olds and with this disrupting families, and by the way,

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Speaker 7: we're deporting people who shouldn't be deported. So that's a change.

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Speaker 7: But this issue works for the president politically. The president

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Speaker 7: is also very good and I worked with the president

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Speaker 7: in the first Trump administration, worked with euphemism. We had

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Speaker 7: a lot of controversy, but this is a different tempo

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Speaker 7: for him. Wayne Gretzky skate to where the puck is

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Speaker 7: going to be, not where it was. The Democrats have

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Speaker 7: to adjust. They are skating to where the puck was.

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Speaker 7: This immigration issue, in some ways is a distraction from

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Speaker 7: what Trump is really doing with cities, which is cutting

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Speaker 7: the budget in a way that is so dramatic that

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Speaker 7: you can really cause major difficulties for urban areas.

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Speaker 8: Governor Cromo pro tip when you're going to talk a

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Speaker 8: hockey you're in a mayoral race, you pick.

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Speaker 9: Genre Tell or someone like that with the New York Rangers.

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Speaker 10: You don't go with Gretzky Andrew Cromo with us here

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Speaker 10: as we look at this mayor race, Okay, Robert Kuttner,

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Speaker 10: no friend of yours, writing an American Prospect, he says,

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Speaker 10: did Cuomo peak too soon?

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Speaker 8: You've got the tensions of the primary, if you take

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Speaker 8: the primary, the tensions of a general election with different

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Speaker 8: independent candidates, and that is the present mayor in the

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Speaker 8: back pocket of the President of the United States. And

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Speaker 8: if we get LA, as Paul mentions, here, can you

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Speaker 8: imagine this? I mean, I'll let you pick the geography,

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Speaker 8: Governor Cuomo, But.

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Speaker 9: The present mayor of New York, can he protect the

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Speaker 9: citizens of this city given the relationship with the president

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Speaker 9: after what we've seen in LA.

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Speaker 7: Short answer, no, And let's remember how extraordinary these issues.

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Speaker 7: What's happening in LA. This is the exact reverse of

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Speaker 7: what normally happens. Normally, it's the local government that makes

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Speaker 7: the decision on how to handle an emergency and calls

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Speaker 7: on the federal government. So a mayor, a governor would

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Speaker 7: call on the federal government say I need help. Please

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Speaker 7: send a national guard or please send an additional federal help.

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Speaker 7: I don't believe there's been a time where the president

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Speaker 7: has sent in federal troops. You'd have to go back

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Speaker 7: to like the sixties and President Johnson and Wallace, Right,

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Speaker 7: that's how far you have to go back. So this

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Speaker 7: is Trump being Trump. This is Trump on this issue

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Speaker 7: of immigration. I'm muscled. It's law and order. These cities,

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Speaker 7: these democrats, they're filled with illegals, and I'm going to

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Speaker 7: come in and I'm going to come in hot and heavy.

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Speaker 7: He started in la It will happen in New York.

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Speaker 7: It will happen. He knows the formula, right, it happened

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Speaker 7: in New Jersey.

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Speaker 11: Is this formula to go after you?

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Speaker 7: I mean, this is his formula, is to create chaos

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Speaker 7: in the cities. And he is the voice of law

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Speaker 7: and order. And you know cities, all those democrats, that's

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Speaker 7: where all those illegal immigrants are. And He's going to

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Speaker 7: come in and he's going to clean up the flip

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Speaker 7: side is okay. Create chaos in LA, create chaos in

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Speaker 7: New York, create chaos in Chicago. Pretty soon you create

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Speaker 7: chaos in the nation, and that's bad for the economy.

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Speaker 3: Andrew Cuomo in a fascinating back and forth with Tom

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Speaker 3: Keene here on Balance of Power. I'm Joe, Matthew and Washington,

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Speaker 3: adding the voice of Ashley Davis, Republican Strategists, partner at

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Speaker 3: S three Group, former Special assistant to the Director of

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Speaker 3: Homeland Security. Actually, it's great to see you. We just

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Speaker 3: heard this whole conversation with Andrew Cuomo. You saw the

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Speaker 3: back and forth, you heard me read President Trump's tweet

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Speaker 3: earlier today. He says, if we had not done so

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Speaker 3: calling up the National Guard, Los Angeles would have been

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Speaker 3: completely obliterated. We can talk about the directive and what

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Speaker 3: law this falls under, and how we're defining insurrection politically speaking.

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Speaker 3: Good move.

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Speaker 9: Yeah.

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Speaker 12: I actually am not sure that interview that Cuomo did

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Speaker 12: this morning is going to be helpful for him.

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Speaker 3: I just want to take us down back.

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Speaker 12: For Cuomo, no, because I mean he listen a lot

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Speaker 12: of people, whether you live in New York or not,

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Speaker 12: are very unhappy with how New York has been as

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Speaker 12: a city, especially as post COVID in regards to some

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Speaker 12: of the crime, and he's running on a law and

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Speaker 12: order platform, so you would think that this is something

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Speaker 12: maybe from a stats' rights perspective he can't before, but

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Speaker 12: I've been assuming he would want to make sure that

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Speaker 12: New York does not turn into what's happening in LA.

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Speaker 12: But Yeah, to answer your question, absolutely, this is a

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Speaker 12: good political issue for the president. I don't think he

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Speaker 12: cares one bit that if you see destruction happening in

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Speaker 12: LA and the mayor, Mayor Bass and the governor are

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Speaker 12: not doing enough to stop the destruction, especially when they're

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Speaker 12: burning buildings, they're burning cars, they're they're His biggest issue

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Speaker 12: is the fact that they're covering their faces and not

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Speaker 12: having any ability to see who they are. Again, are

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Speaker 12: these really protests from LA? Are they brought in like

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Speaker 12: they have been in other places? But this is a

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Speaker 12: winning issue for him. I would love to see pulling

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Speaker 12: on this in a week because I would think most

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Speaker 12: of the country would say, why the forty people? And

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Speaker 12: it's this very important fact, the forty people that were

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Speaker 12: arrested that sparked these protests this weekend there was a

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Speaker 12: layout this morning of the crimes that each one did.

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Speaker 12: I mean they're bad crimes or either murder, rape, significant burglary.

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Speaker 12: I mean, it's not like that the people are protesting for,

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Speaker 12: as Quemo said, children and people that are on their

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Speaker 12: way to citizenship. So this is something that's going to

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Speaker 12: be very tough for Democrats to come over, and in

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Speaker 12: my opinion, they're taking the bait over and over and

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Speaker 12: over again. I mean, this is something that we've been

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Speaker 12: talking about Ze it's like an eighty percent issue that

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Speaker 12: people support us cracking down on stuff like this.

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Speaker 3: Yeah, Newsom was telling people not that this was performative.

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Speaker 3: Don't play into the hands of the administration. I'm wondering

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Speaker 3: what you thought of Newsome pushing back on this. This

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Speaker 3: played out on television in a pretty remarkable way, with

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Speaker 3: Tom Holman threatening to arrest the governor and the mayor

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Speaker 3: of la Let's hear the response from Gavin Newsom on MSNBC.

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Speaker 3: He's a tough guy.

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Speaker 6: Why wasn't he do that?

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Speaker 3: And he knows where to find me.

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Speaker 10: But you know what, Now, your hands off four year

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Speaker 10: old girls that are trying to get educated.

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Speaker 3: Put your hands off these poor people. Are just trying

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Speaker 3: to get live their lives. Man trying to live their

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Speaker 3: lives paying their tax has been here ten years. The fear,

436
00:23:59,240 --> 00:24:02,280
Speaker 3: the horror, the hell is this guy come after me?

437
00:24:02,400 --> 00:24:03,840
Speaker 3: Arrest me? Let's just get it over with.

438
00:24:06,320 --> 00:24:09,760
Speaker 12: This is wild stuff, good politics for good as I

439
00:24:09,800 --> 00:24:11,560
Speaker 12: was just going to say, it's actually making new some

440
00:24:11,680 --> 00:24:13,520
Speaker 12: relevant again, I mean that was kind of you know,

441
00:24:13,560 --> 00:24:17,320
Speaker 12: if he truly does want to run for president, but

442
00:24:17,480 --> 00:24:20,280
Speaker 12: again I don't. I mean, maybe times will change in

443
00:24:20,320 --> 00:24:22,320
Speaker 12: three and a half years when we have another president,

444
00:24:22,400 --> 00:24:25,320
Speaker 12: but I mean, like this does not show tough on crime,

445
00:24:25,359 --> 00:24:27,560
Speaker 12: which was such a big issue this time around. Okay,

446
00:24:27,600 --> 00:24:30,800
Speaker 12: I mean again, we know the president mago, President Trump

447
00:24:30,840 --> 00:24:33,720
Speaker 12: mago too far and the pundulum swing, so who knows, right.

448
00:24:33,840 --> 00:24:36,800
Speaker 3: Was arresting the governor's going too far? I don't think

449
00:24:36,840 --> 00:24:40,360
Speaker 3: it's going to happen, but that would maybe qualify having.

450
00:24:40,200 --> 00:24:44,240
Speaker 12: This fighting on TV. Stuff like whether or over yeah,

451
00:24:44,320 --> 00:24:46,600
Speaker 12: or over social media is just a new norse.

452
00:24:46,720 --> 00:24:49,320
Speaker 3: Quite a moment or society is in here, isn't it. Well,

453
00:24:49,359 --> 00:24:51,960
Speaker 3: So let's talk about the actual fine print, because you

454
00:24:52,720 --> 00:24:54,480
Speaker 3: used to do this for a living. The directives signed

455
00:24:54,520 --> 00:24:58,560
Speaker 3: by the President cites ten USC. Twelve four h six,

456
00:24:58,600 --> 00:25:00,640
Speaker 3: referring to a provision and Title ten of the US

457
00:25:00,720 --> 00:25:04,439
Speaker 3: Coat on Armed Services. If there's a rebellion or danger

458
00:25:04,480 --> 00:25:06,399
Speaker 3: of a rebellion against the authority of the government of

459
00:25:06,440 --> 00:25:09,520
Speaker 3: the United States, it allows the federal deployment of National

460
00:25:09,600 --> 00:25:10,280
Speaker 3: Guard forces.

461
00:25:10,400 --> 00:25:10,600
Speaker 2: Yeah.

462
00:25:10,600 --> 00:25:11,199
Speaker 12: I don't think this is.

463
00:25:11,200 --> 00:25:12,639
Speaker 3: Are we call them as a rebellion?

464
00:25:13,480 --> 00:25:14,480
Speaker 12: What else would you call it?

465
00:25:14,680 --> 00:25:15,320
Speaker 3: A protest?

466
00:25:15,480 --> 00:25:18,520
Speaker 12: But the protest isn't just it's not a peaceful protest. No,

467
00:25:18,640 --> 00:25:21,000
Speaker 12: it's a destructive protest. I mean, you saw this stuff.

468
00:25:20,960 --> 00:25:22,680
Speaker 12: I'm you see what was happening. I don't think it's

469
00:25:22,680 --> 00:25:23,960
Speaker 12: like people holding signs.

470
00:25:24,000 --> 00:25:26,800
Speaker 3: Well, it kind of started that way in some cases.

471
00:25:26,800 --> 00:25:29,240
Speaker 3: And I'm not here to weigh in on that one

472
00:25:29,240 --> 00:25:31,080
Speaker 3: way or the other. But when you start thinking about

473
00:25:31,720 --> 00:25:34,679
Speaker 3: an insurrection, we don't want to call January sixth that.

474
00:25:34,760 --> 00:25:37,359
Speaker 3: But we're calling this an insurrection to qualify for the

475
00:25:37,720 --> 00:25:38,719
Speaker 3: deployment of troops.

476
00:25:39,680 --> 00:25:43,680
Speaker 12: I well, we may agree to disagree on because No,

477
00:25:43,760 --> 00:25:47,040
Speaker 12: I just think that there was enough destruction going on.

478
00:25:47,160 --> 00:25:49,560
Speaker 12: I mean, listen, everything else is in the courts. Does

479
00:25:49,600 --> 00:25:53,960
Speaker 12: the obviously the governor did sue the president for doing this? Yes,

480
00:25:54,119 --> 00:25:56,520
Speaker 12: you know, I just have one thing to say, Katrina

481
00:25:56,560 --> 00:25:58,800
Speaker 12: wouldn't have been as bad as Katrina was if the

482
00:25:58,800 --> 00:26:02,000
Speaker 12: local government then would have allowed the President Bush to

483
00:26:02,040 --> 00:26:06,040
Speaker 12: call in the National Guard. And he did not overturn

484
00:26:06,240 --> 00:26:09,120
Speaker 12: the mayor at the time of New Orleans, and that

485
00:26:09,280 --> 00:26:11,719
Speaker 12: was when the right after the lovees broken whatever, and

486
00:26:11,720 --> 00:26:13,760
Speaker 12: that was one of the biggest destructions in our country.

487
00:26:13,800 --> 00:26:16,359
Speaker 12: I mean, I think that this is a very fine line.

488
00:26:16,520 --> 00:26:20,560
Speaker 12: But again, legally we'll see. I'm sure we'll be in

489
00:26:20,560 --> 00:26:23,920
Speaker 12: the courts, but politically, like presence, like bringing on, he's

490
00:26:23,920 --> 00:26:25,320
Speaker 12: going to be in the court for the next ten

491
00:26:25,400 --> 00:26:25,840
Speaker 12: years to.

492
00:26:26,040 --> 00:26:29,879
Speaker 3: Well, I guess that's for sure. As a homeland security specialist,

493
00:26:30,240 --> 00:26:32,960
Speaker 3: do you worry about the idea of Marines being deployed

494
00:26:32,960 --> 00:26:35,040
Speaker 3: and I realized that that's likely just a threat from

495
00:26:35,080 --> 00:26:37,280
Speaker 3: Pete Hegseth. But would that be a line Tocross.

496
00:26:37,600 --> 00:26:39,800
Speaker 12: I think that's a tougher line, for sure. I mean,

497
00:26:39,840 --> 00:26:45,880
Speaker 12: the Marines and you have guns, and you'll have obviously troops,

498
00:26:45,920 --> 00:26:48,760
Speaker 12: and it's a whole different scene. I think, unless people

499
00:26:48,760 --> 00:26:51,920
Speaker 12: are getting killed, if you see major destruction in regards

500
00:26:51,960 --> 00:26:54,520
Speaker 12: to buildings burning, I mean more than it's already happening.

501
00:26:54,640 --> 00:26:57,560
Speaker 12: I just can't imagine that happens. But we'll see One

502
00:26:57,600 --> 00:26:59,159
Speaker 12: thing that we were talking about before the YAR is

503
00:26:59,200 --> 00:27:01,240
Speaker 12: like does this spread from city to city to city

504
00:27:01,440 --> 00:27:04,600
Speaker 12: like some of the things that happened during COVID you

505
00:27:04,640 --> 00:27:06,760
Speaker 12: know obviously, George Floyd. I mean, we can go down

506
00:27:06,760 --> 00:27:08,960
Speaker 12: some of the issues, but that's what you don't want

507
00:27:08,960 --> 00:27:12,800
Speaker 12: to see happen. Is this a call to will this be?

508
00:27:13,960 --> 00:27:15,840
Speaker 12: Is this going to be a Democrats call to action?

509
00:27:15,960 --> 00:27:17,399
Speaker 12: Are they going to fall in the hell in this

510
00:27:17,480 --> 00:27:21,960
Speaker 12: issue and call for protest? I'm not sure if you

511
00:27:22,040 --> 00:27:24,479
Speaker 12: don't have kind of what's been happening with a lot

512
00:27:24,560 --> 00:27:26,960
Speaker 12: of these protests, not necessary immigration, but a lot of

513
00:27:26,960 --> 00:27:30,760
Speaker 12: these professional protests that have been happening with destruction over

514
00:27:30,800 --> 00:27:33,480
Speaker 12: the last five to so years, is you have people

515
00:27:33,480 --> 00:27:36,080
Speaker 12: that are hired to come destroy things just to make

516
00:27:36,640 --> 00:27:39,159
Speaker 12: chaos in the country, whether you believe it's Russia or

517
00:27:39,280 --> 00:27:44,959
Speaker 12: China or whatever. So that's but I would think anyone

518
00:27:45,040 --> 00:27:47,680
Speaker 12: running for president is not going to want this. They're

519
00:27:47,720 --> 00:27:49,040
Speaker 12: not going to fall in their swords on this.

520
00:27:49,359 --> 00:27:50,879
Speaker 3: Well, this is what I wanted to get to you

521
00:27:50,880 --> 00:27:53,520
Speaker 3: with as as someone who's actually been in the building,

522
00:27:54,240 --> 00:27:56,840
Speaker 3: you're looking at the great unknown of this summer. Inside,

523
00:27:56,880 --> 00:27:59,359
Speaker 3: we'll say, the Department of Homeland Security, how do you

524
00:27:59,400 --> 00:28:02,240
Speaker 3: start model for the possibilities because this could in fact

525
00:28:02,520 --> 00:28:04,320
Speaker 3: go into other cities. What if this did go into

526
00:28:04,359 --> 00:28:07,520
Speaker 3: New York as Tom Keane was discussing with Andrew Cuomo,

527
00:28:07,600 --> 00:28:11,200
Speaker 3: what if there's another occupy movement? Is that what Homeland

528
00:28:11,240 --> 00:28:12,120
Speaker 3: is working on now?

529
00:28:12,720 --> 00:28:15,359
Speaker 12: I'm sure they are. I'm definitely I think you have.

530
00:28:15,840 --> 00:28:19,200
Speaker 12: And also you have a lot of events coming up.

531
00:28:19,280 --> 00:28:22,520
Speaker 12: Whether it's well a year from now is America to fifty,

532
00:28:22,520 --> 00:28:25,199
Speaker 12: but we have the parade this weekend. You have a

533
00:28:25,240 --> 00:28:29,320
Speaker 12: lot of different opportunities for chaos. But also what the

534
00:28:29,400 --> 00:28:32,159
Speaker 12: department is doing right now, along with the DOJ, is

535
00:28:32,200 --> 00:28:35,600
Speaker 12: really concentrating on some of the destruction regards to anti Semitism.

536
00:28:35,920 --> 00:28:38,320
Speaker 12: So you have the anti Semitism, you have the anti

537
00:28:38,440 --> 00:28:44,160
Speaker 12: immigrant movement, and then you have the flames being flared

538
00:28:44,520 --> 00:28:49,640
Speaker 12: that if you're in the coordinating of state and local

539
00:28:50,000 --> 00:28:53,600
Speaker 12: law enforcement right now within the Homeland Security Department, you

540
00:28:53,640 --> 00:28:56,280
Speaker 12: are making sure that everyone's prepared for something to happen,

541
00:28:56,400 --> 00:28:58,720
Speaker 12: to something to happen, especially in the major cities.

542
00:28:59,200 --> 00:29:01,760
Speaker 3: Did you see the foot to this Australian reporter who

543
00:29:01,800 --> 00:29:04,800
Speaker 3: was on the streets in Los Angeles and she's talking

544
00:29:04,840 --> 00:29:07,360
Speaker 3: about the response from the police was right around the

545
00:29:07,400 --> 00:29:12,200
Speaker 3: time they started shooting rubber pellets or the bean bags

546
00:29:12,240 --> 00:29:14,800
Speaker 3: and so forth and deploying the tear gas. I don't

547
00:29:14,800 --> 00:29:16,680
Speaker 3: know if we have this for our audience on YouTube,

548
00:29:16,960 --> 00:29:21,760
Speaker 3: but she's actually live in Australia. This is the video

549
00:29:21,840 --> 00:29:25,000
Speaker 3: from this situation, and she's shot in the leg while

550
00:29:25,040 --> 00:29:28,400
Speaker 3: she's out there. This is the type of thing that

551
00:29:28,440 --> 00:29:31,520
Speaker 3: can really change the way a story plays in the media.

552
00:29:31,720 --> 00:29:33,640
Speaker 3: You see her being shot and we don't hear her

553
00:29:33,640 --> 00:29:35,880
Speaker 3: screams right now if you're with us on the radio,

554
00:29:35,920 --> 00:29:37,880
Speaker 3: but it was a bit of a scary moment for her.

555
00:29:39,080 --> 00:29:42,880
Speaker 3: These things can turn pretty quickly in public opinion the

556
00:29:42,920 --> 00:29:45,280
Speaker 3: way this is handled by authorities on the ground.

557
00:29:45,760 --> 00:29:49,280
Speaker 12: If you see people, if you see peaceful protesters being

558
00:29:49,920 --> 00:29:53,080
Speaker 12: strong armed by the military, whether it's especially like the

559
00:29:53,160 --> 00:29:58,600
Speaker 12: National Guard, guest, this can definitely change the conversation quickly. Obviously,

560
00:29:58,680 --> 00:30:03,280
Speaker 12: that's super unfortunately seen that. Yeah, But by the way,

561
00:30:03,280 --> 00:30:05,040
Speaker 12: there's going to be propaganda on both sides. You're going

562
00:30:05,120 --> 00:30:08,280
Speaker 12: to see the same video of the guy with the

563
00:30:08,400 --> 00:30:12,600
Speaker 12: Mexican flag and the you know, burning. Well, no, I'm

564
00:30:12,600 --> 00:30:14,760
Speaker 12: burning the Yeah, I'm burning the car and the mask.

565
00:30:15,280 --> 00:30:19,600
Speaker 3: Particularly dystopian by the way, about protesters burning robotic vehicles,

566
00:30:19,640 --> 00:30:22,600
Speaker 3: I think we have truly reached a science fiction phase

567
00:30:23,120 --> 00:30:27,240
Speaker 3: when we see stuff like that. But the aftermath here

568
00:30:27,280 --> 00:30:29,240
Speaker 3: could be interesting. What happens in the next couple of

569
00:30:29,280 --> 00:30:31,720
Speaker 3: days in Los Angeles? How do you cool the temperature?

570
00:30:31,880 --> 00:30:34,520
Speaker 12: Well, hopefully, I mean, I'm from what we're seeing today,

571
00:30:34,560 --> 00:30:37,720
Speaker 12: there's not as many protests, there's less and less. I mean,

572
00:30:37,720 --> 00:30:41,360
Speaker 12: it would be great if they stop and I mean

573
00:30:41,360 --> 00:30:43,800
Speaker 12: this and then everyone kind of backs off. It's just

574
00:30:44,440 --> 00:30:46,800
Speaker 12: what's scary and what's making me a little nervous, and

575
00:30:47,000 --> 00:30:49,200
Speaker 12: going back to your Department of Homeland Security making them

576
00:30:49,240 --> 00:30:51,640
Speaker 12: a little nervous, and local law enforcement is if this

577
00:30:51,720 --> 00:30:52,920
Speaker 12: does escalate.

578
00:30:52,640 --> 00:30:56,040
Speaker 3: Yeah, could Washington? Could New York handle the situation like

579
00:30:56,080 --> 00:30:56,880
Speaker 3: that better than LA?

580
00:30:59,600 --> 00:31:01,360
Speaker 12: Well, I think I think the current mayor of New

581
00:31:01,440 --> 00:31:04,080
Speaker 12: York would handle it pretty well. I mean, that's just

582
00:31:04,160 --> 00:31:06,120
Speaker 12: not a political statement one way or the other. But

583
00:31:06,160 --> 00:31:09,080
Speaker 12: I think he saw I mean, it's an electioneer obviously

584
00:31:09,120 --> 00:31:13,000
Speaker 12: there's one, yes, but I think that he would probably

585
00:31:13,040 --> 00:31:14,960
Speaker 12: call in the help. I mean, you saw that city

586
00:31:15,080 --> 00:31:17,920
Speaker 12: was destroyed. It's starting to make its way back. Same

587
00:31:17,960 --> 00:31:20,560
Speaker 12: with LA. I mean there has to be a grasp

588
00:31:20,600 --> 00:31:22,280
Speaker 12: on some of this, not because of the protests. I'm

589
00:31:22,320 --> 00:31:24,240
Speaker 12: just saying in general, Sure, what's happened.

590
00:31:24,280 --> 00:31:26,000
Speaker 3: Well, I appreciate your point of view. We went into

591
00:31:26,000 --> 00:31:28,160
Speaker 3: overtime because I really wanted to hear what you had

592
00:31:28,240 --> 00:31:30,600
Speaker 3: to say about this. This is a very delicate moment

593
00:31:30,640 --> 00:31:33,640
Speaker 3: and we're lucky to have Ashley Davis bring out one

594
00:31:33,680 --> 00:31:35,800
Speaker 3: side of this argument for us from S three group.

595
00:31:35,800 --> 00:31:37,640
Speaker 3: Great to have you and thank you, Thanks Ashley.

596
00:31:37,680 --> 00:31:44,480
Speaker 1: As always, you're listening to the Bloomberg Balance of Power podcast.

597
00:31:44,760 --> 00:31:47,880
Speaker 1: Catch us live weekdays at noon and five pm. E'stern

598
00:31:48,000 --> 00:31:51,440
Speaker 1: on Apple, Cockley and Android Otto with the Bloomberg Business App.

599
00:31:51,640 --> 00:31:54,880
Speaker 1: Listen on demand wherever you get your podcasts, or watch

600
00:31:54,960 --> 00:31:57,440
Speaker 1: us live on YouTube.

601
00:31:57,560 --> 00:32:02,920
Speaker 3: We reach for the next answer when it comes to reconciliation.

602
00:32:03,120 --> 00:32:07,360
Speaker 3: The questions have not changed in a while. We're waiting

603
00:32:07,360 --> 00:32:09,320
Speaker 3: for the Senate to show up with its version of

604
00:32:09,360 --> 00:32:12,560
Speaker 3: President Trump's Big Tax and Spend Bill? Are we done

605
00:32:12,560 --> 00:32:16,360
Speaker 3: calling it a big, beautiful bill? Like the Big Tax

606
00:32:16,400 --> 00:32:19,479
Speaker 3: and Spend Bill? The question about tax breaks, will they

607
00:32:19,520 --> 00:32:23,800
Speaker 3: be permanent? Business tax breaks? Not just individual Trump tax cuts,

608
00:32:23,840 --> 00:32:28,960
Speaker 3: but also of course Medicaid. I'll say changes for the

609
00:32:29,000 --> 00:32:32,920
Speaker 3: benefit of this conversation. And then, well, if you're watching

610
00:32:33,000 --> 00:32:36,040
Speaker 3: or listening to Bloomberg, the granddaddy of them all being Salt.

611
00:32:36,760 --> 00:32:39,160
Speaker 3: I mentioned this because the Senate Finance Committee is going

612
00:32:39,200 --> 00:32:42,240
Speaker 3: to put forth it's part of the bill, the big

613
00:32:42,320 --> 00:32:46,360
Speaker 3: beautiful bill this week. Mike Crapo, Republican, Wyoming, the chair,

614
00:32:47,400 --> 00:32:50,640
Speaker 3: is behind the drive to make these tax breaks permanent.

615
00:32:51,880 --> 00:32:54,600
Speaker 3: That's going to change the whole dynamic now because we're

616
00:32:54,640 --> 00:32:57,720
Speaker 3: hearing that Salt is going to come down. We're hearing

617
00:32:57,800 --> 00:33:01,600
Speaker 3: that Medicaid changes could happen, maybe the provider tax, with

618
00:33:01,760 --> 00:33:06,520
Speaker 3: worries about the impact on rural communities, and that could

619
00:33:06,520 --> 00:33:10,240
Speaker 3: be enough to sink this bill when it goes back

620
00:33:10,320 --> 00:33:14,560
Speaker 3: to the House. It's about to happen. Senator Crapo is

621
00:33:14,600 --> 00:33:19,520
Speaker 3: going to put forth his bill this week, and you

622
00:33:19,600 --> 00:33:21,680
Speaker 3: better believe that the Speaker of the House, Mike Johnson,

623
00:33:21,720 --> 00:33:23,920
Speaker 3: is holding his breath right now. Let's assemble our panel

624
00:33:23,920 --> 00:33:26,360
Speaker 3: for their take on this and a lot more. Jinny

625
00:33:26,360 --> 00:33:29,840
Speaker 3: Schanzano is with us, our Bloomberg Politics contributor in Democratic

626
00:33:29,880 --> 00:33:32,120
Speaker 3: Analysts with the Center for the Study of the Presidency

627
00:33:32,120 --> 00:33:36,360
Speaker 3: in Congress and Lisa Camuso Miller, Republican strategist former RNC

628
00:33:36,400 --> 00:33:40,479
Speaker 3: Comms director, spend time working for a former Republican speaker.

629
00:33:40,520 --> 00:33:42,920
Speaker 3: And Lisa, I'll start with you. Here are the shields

630
00:33:43,000 --> 00:33:46,240
Speaker 3: up in the Speaker's office right now. They know something's

631
00:33:46,320 --> 00:33:47,520
Speaker 3: going to come back. They don't want.

632
00:33:49,320 --> 00:33:51,320
Speaker 11: I think it would have to be right.

633
00:33:51,360 --> 00:33:54,440
Speaker 13: I mean, Joe, I think more than anything, they have expectations.

634
00:33:54,480 --> 00:33:56,280
Speaker 13: They've had a little bit of time to think about

635
00:33:56,360 --> 00:33:57,720
Speaker 13: how they're going to respond to this.

636
00:33:58,160 --> 00:34:00,160
Speaker 11: I think that they've known where the fault lines are.

637
00:34:00,280 --> 00:34:02,720
Speaker 13: So the Speaker's office is already working behind the scenes

638
00:34:02,760 --> 00:34:05,840
Speaker 13: to figure out what kinds of expectations they might have,

639
00:34:06,000 --> 00:34:08,480
Speaker 13: what kinds of adjustments they could make to get themselves

640
00:34:08,480 --> 00:34:10,280
Speaker 13: to a place where they could all get it done.

641
00:34:10,560 --> 00:34:12,480
Speaker 11: It's going to be a challenge, there's no doubt about it.

642
00:34:12,520 --> 00:34:14,440
Speaker 13: But I think Speaker Johnson knew that going in, and

643
00:34:14,480 --> 00:34:16,239
Speaker 13: he's got the people around him that are going to

644
00:34:16,280 --> 00:34:19,640
Speaker 13: help him get a compromise bill that's going to be

645
00:34:19,640 --> 00:34:21,759
Speaker 13: able to get done and get signed because they are

646
00:34:21,800 --> 00:34:24,560
Speaker 13: really motivated to get this, to get this right.

647
00:34:25,680 --> 00:34:28,600
Speaker 3: We heard from Mike Lawler over the weekend, Genie, the

648
00:34:28,640 --> 00:34:32,160
Speaker 3: Republican from your state of New York says, you hack

649
00:34:32,280 --> 00:34:35,960
Speaker 3: up that salt deal. I'm a hard no. And that

650
00:34:36,000 --> 00:34:38,680
Speaker 3: goes for others in the New York delegation. That alone

651
00:34:39,080 --> 00:34:41,319
Speaker 3: would sink the bill. Right, we can only lose three,

652
00:34:41,400 --> 00:34:43,719
Speaker 3: I believe, is where we're at. What happens when the

653
00:34:43,719 --> 00:34:45,240
Speaker 3: bill comes back to the House, then.

654
00:34:46,360 --> 00:34:50,000
Speaker 6: Yeah, hands off salt. It's becomes sort of a mantra

655
00:34:50,120 --> 00:34:53,399
Speaker 6: around these parts and in other high tax places. And

656
00:34:54,000 --> 00:34:57,680
Speaker 6: you know, Mike Lawler is speaking for enough Republicans in

657
00:34:57,719 --> 00:35:01,759
Speaker 6: the House from these high tax that it's going to

658
00:35:01,840 --> 00:35:05,040
Speaker 6: be very hard to get their vote if they reduce

659
00:35:05,120 --> 00:35:07,240
Speaker 6: the cap from what they agreed to in the House.

660
00:35:07,640 --> 00:35:10,279
Speaker 6: The problem, of course for the Senate is is that

661
00:35:10,800 --> 00:35:13,879
Speaker 6: they don't have people in the Senate GOP who are

662
00:35:13,920 --> 00:35:16,680
Speaker 6: really focused on salt or care that much about it.

663
00:35:16,840 --> 00:35:21,560
Speaker 6: Number one and number two, they are really intent on

664
00:35:22,239 --> 00:35:25,640
Speaker 6: doing some damage to salt, and the White House, by

665
00:35:25,719 --> 00:35:27,920
Speaker 6: the way, has said the President is okay with that.

666
00:35:28,080 --> 00:35:30,720
Speaker 6: I mean President Trump has been all over the place

667
00:35:30,760 --> 00:35:33,680
Speaker 6: on salt. And so if they do touch salt, which

668
00:35:33,719 --> 00:35:35,759
Speaker 6: I think they will, they're going to have to be

669
00:35:35,880 --> 00:35:38,960
Speaker 6: very cautious because they will lose the support in the

670
00:35:39,000 --> 00:35:42,040
Speaker 6: Senate that and in the House. Rather that said, I

671
00:35:42,120 --> 00:35:44,279
Speaker 6: think we're hearing that Mike Lawler is going to talk

672
00:35:44,320 --> 00:35:46,360
Speaker 6: to Thune. He's going to talk to other Senators and

673
00:35:46,360 --> 00:35:49,439
Speaker 6: tell him how damaging this would be, and they will

674
00:35:49,560 --> 00:35:52,360
Speaker 6: come to some kind of compromise. I think on the

675
00:35:52,440 --> 00:35:53,200
Speaker 6: issue of salt.

676
00:35:54,160 --> 00:35:57,400
Speaker 3: How much communication Lisa is going on behind the scenes

677
00:35:57,440 --> 00:36:00,840
Speaker 3: right now between Mike Johnson and John Thune, maybe among

678
00:36:00,880 --> 00:36:04,279
Speaker 3: their teams knowing if we know about this, they sure

679
00:36:04,360 --> 00:36:06,759
Speaker 3: do to try to try to limit the number of

680
00:36:06,880 --> 00:36:10,759
Speaker 3: changes to ask for some grace when it comes to

681
00:36:10,800 --> 00:36:13,000
Speaker 3: the bill coming back. Or am I crazy? The Senate

682
00:36:13,040 --> 00:36:14,080
Speaker 3: always jams the House.

683
00:36:15,040 --> 00:36:17,160
Speaker 11: No, I don't think you're crazy at all, Joe. I think,

684
00:36:17,200 --> 00:36:19,399
Speaker 11: if anything, you're absolutely right. I mean, I don't think

685
00:36:19,400 --> 00:36:20,600
Speaker 11: the principals are meeting.

686
00:36:20,680 --> 00:36:23,160
Speaker 13: I don't think that the two you know, the lead

687
00:36:23,200 --> 00:36:25,920
Speaker 13: two leaders, will be meeting until we're getting closer to the.

688
00:36:25,960 --> 00:36:27,200
Speaker 11: End on this negotiation.

689
00:36:27,680 --> 00:36:31,000
Speaker 13: But if you mean, staff all day long are working together,

690
00:36:31,160 --> 00:36:33,719
Speaker 13: not only at the highest highest levels, but all the

691
00:36:33,719 --> 00:36:35,759
Speaker 13: way down into the committees to make sure that they're

692
00:36:35,800 --> 00:36:38,439
Speaker 13: trying to find a way to get this right. And look,

693
00:36:38,480 --> 00:36:40,319
Speaker 13: this is the way the House and the Senate do

694
00:36:40,440 --> 00:36:43,880
Speaker 13: their business together. Do we knock on one another and

695
00:36:43,920 --> 00:36:45,560
Speaker 13: say that they do work differently than we do.

696
00:36:45,680 --> 00:36:46,560
Speaker 11: Yeah. Absolutely.

697
00:36:46,880 --> 00:36:49,319
Speaker 13: But the truth of it is is that policy books

698
00:36:49,360 --> 00:36:51,960
Speaker 13: are working together to try to find common ground in

699
00:36:52,080 --> 00:36:54,719
Speaker 13: order to get something that can get done and can

700
00:36:54,760 --> 00:36:56,920
Speaker 13: get to the President's desk. And I do think that

701
00:36:56,960 --> 00:37:00,000
Speaker 13: they're still really working towards a July fourth completion price.

702
00:37:01,200 --> 00:37:04,120
Speaker 3: Boy, that would be something Chuck Schumer doesn't necessarily see

703
00:37:04,160 --> 00:37:07,000
Speaker 3: it that way. And before we get to that, we're

704
00:37:07,040 --> 00:37:09,480
Speaker 3: going to have to deal with recisions. Genie. This is

705
00:37:10,160 --> 00:37:12,640
Speaker 3: something that Democrats were at one time worried about, and

706
00:37:12,640 --> 00:37:14,560
Speaker 3: I'm wondering if you are at this point, because there's

707
00:37:14,560 --> 00:37:16,760
Speaker 3: not a lot there and we've got nine billion dollars

708
00:37:16,840 --> 00:37:20,160
Speaker 3: nine point four billion dollars in the recisions package. Remember

709
00:37:20,200 --> 00:37:24,280
Speaker 3: this is public broadcasting, USAID, a couple of other things

710
00:37:24,320 --> 00:37:28,319
Speaker 3: including PEPFAR and now this is something that brings us

711
00:37:28,360 --> 00:37:31,160
Speaker 3: back to the George W. Bush administration funding to help

712
00:37:31,200 --> 00:37:35,160
Speaker 3: fight AIDS and HIV on a global level. There are

713
00:37:35,160 --> 00:37:37,600
Speaker 3: a number of Republicans who are uncomfortable with cuts to

714
00:37:37,640 --> 00:37:40,800
Speaker 3: pep Far and now at least ten moderate R's genie

715
00:37:41,160 --> 00:37:44,319
Speaker 3: are privately saying in the House of Representatives that they're

716
00:37:44,320 --> 00:37:47,880
Speaker 3: a no. Is it possible that this thing goes down

717
00:37:48,320 --> 00:37:50,840
Speaker 3: and not a dollar is rescinded.

718
00:37:52,600 --> 00:37:55,440
Speaker 6: I think it is possible, at least the pep far

719
00:37:55,600 --> 00:37:59,600
Speaker 6: perch portion will go down, and rightly it should. The

720
00:37:59,719 --> 00:38:03,000
Speaker 6: damn image done to people around the world from the

721
00:38:03,040 --> 00:38:07,360
Speaker 6: perspective of their health, if indeed they do, they do

722
00:38:07,480 --> 00:38:11,319
Speaker 6: move forward on that is so astonishing. It's hard to

723
00:38:11,320 --> 00:38:13,680
Speaker 6: wrap your head around that being the thing that they

724
00:38:13,760 --> 00:38:16,919
Speaker 6: cut or try to pull back. So I do think

725
00:38:16,960 --> 00:38:20,239
Speaker 6: that goes down. I don't think they will fail to

726
00:38:20,280 --> 00:38:22,160
Speaker 6: get even a dollar, but I think it's going to

727
00:38:22,239 --> 00:38:26,279
Speaker 6: be much much smaller because the reality of this entire, big,

728
00:38:26,360 --> 00:38:31,239
Speaker 6: beautiful bill and the recision of package itself is it

729
00:38:31,360 --> 00:38:35,320
Speaker 6: is damaging to the people who need the support most,

730
00:38:35,719 --> 00:38:38,000
Speaker 6: and that is what makes it, for so many of us,

731
00:38:38,040 --> 00:38:42,799
Speaker 6: such a deplorable bill. It is hurting the people who

732
00:38:42,840 --> 00:38:45,319
Speaker 6: need health care. It is hurting the people who need

733
00:38:45,440 --> 00:38:48,960
Speaker 6: medical care. It is hurting the environment which we all

734
00:38:49,000 --> 00:38:51,400
Speaker 6: depend on. I mean, you can go down the litany

735
00:38:52,000 --> 00:38:55,120
Speaker 6: all in the interest of giving tax breaks to big

736
00:38:55,160 --> 00:38:57,879
Speaker 6: business and people who make a lot of money. So

737
00:38:58,040 --> 00:39:01,600
Speaker 6: this is where they are and it is devastating from

738
00:39:01,600 --> 00:39:04,279
Speaker 6: so many perspectives. And that is just one example from

739
00:39:04,280 --> 00:39:07,640
Speaker 6: the recision portion. And I would just say that that

740
00:39:07,800 --> 00:39:10,520
Speaker 6: is why Donald Trump is so intent on pushing out

741
00:39:10,560 --> 00:39:13,319
Speaker 6: pictures of what's going down in LA because he very

742
00:39:13,440 --> 00:39:16,080
Speaker 6: much doesn't want to talk about that, but he wants

743
00:39:16,120 --> 00:39:18,239
Speaker 6: to talk about the fact this invests money in the

744
00:39:18,239 --> 00:39:20,920
Speaker 6: border where he wants to make the case it is needed.

745
00:39:22,400 --> 00:39:25,160
Speaker 3: Remember when Mitt Romney was going to cut big birds

746
00:39:25,200 --> 00:39:29,640
Speaker 3: funding Lisa turned out to be not the best time

747
00:39:29,800 --> 00:39:33,160
Speaker 3: spent considering the return you get on the dollar. To

748
00:39:33,239 --> 00:39:35,759
Speaker 3: make that argument, are we really doing this? We're going

749
00:39:35,800 --> 00:39:37,720
Speaker 3: to defund PBS once and for earlier.

750
00:39:39,960 --> 00:39:42,600
Speaker 13: I mean, it feels like that's where we're headed for sure,

751
00:39:42,680 --> 00:39:46,080
Speaker 13: and I think Genie's point is one to take. I

752
00:39:46,120 --> 00:39:48,360
Speaker 13: also think that we need to consider that when you

753
00:39:48,440 --> 00:39:53,239
Speaker 13: are asking so many vulnerable members of Congress on the

754
00:39:53,320 --> 00:39:56,319
Speaker 13: right and the left for that matter, to make these

755
00:39:56,320 --> 00:40:01,640
Speaker 13: hard decisions in the reconciliation legislation. When they comes to recisions,

756
00:40:01,680 --> 00:40:05,160
Speaker 13: I think a lot of political capital has been expended already,

757
00:40:05,200 --> 00:40:07,920
Speaker 13: and that's the other difficulty here is that had we

758
00:40:08,040 --> 00:40:13,880
Speaker 13: had this bill go through with pieces of good policy,

759
00:40:14,280 --> 00:40:16,240
Speaker 13: I think that a lot of other folks would feel

760
00:40:16,280 --> 00:40:20,200
Speaker 13: better about taking a sharper pencil to the budget and

761
00:40:20,239 --> 00:40:23,400
Speaker 13: these opportunities that are coming through in the recisions package.

762
00:40:23,480 --> 00:40:25,080
Speaker 11: The problem is, I think people are going to be.

763
00:40:25,120 --> 00:40:28,840
Speaker 13: Just downright tired and unhappy with the way these processes

764
00:40:28,880 --> 00:40:31,759
Speaker 13: are moving, and so that alone makes it that much

765
00:40:31,800 --> 00:40:34,200
Speaker 13: more difficult for them to get to a place where

766
00:40:34,200 --> 00:40:37,120
Speaker 13: they can agree upon whether or not PBS should be

767
00:40:37,160 --> 00:40:39,160
Speaker 13: part of the chopping block, a pep far should be

768
00:40:39,200 --> 00:40:41,239
Speaker 13: part of the child. All of these things are just

769
00:40:41,440 --> 00:40:43,719
Speaker 13: one blow after another that they know they're going to

770
00:40:43,800 --> 00:40:45,680
Speaker 13: have to answer for when they go home in August

771
00:40:46,080 --> 00:40:50,960
Speaker 13: and when they have to compete for their seats up

772
00:40:51,000 --> 00:40:53,560
Speaker 13: again in the midterms, which are just around the corner.

773
00:40:54,520 --> 00:41:00,040
Speaker 3: It is really interesting when lawmakers rediscover certain constituencies depending

774
00:41:00,080 --> 00:41:04,160
Speaker 3: on the debate here, Genie, you back off and look

775
00:41:04,160 --> 00:41:06,680
Speaker 3: at what happened with the DOGE or I guess is happening.

776
00:41:06,760 --> 00:41:09,279
Speaker 3: They continue their work in the wake of Elon Musk.

777
00:41:09,320 --> 00:41:11,239
Speaker 3: But that's what brought us here. This was supposed to

778
00:41:11,280 --> 00:41:14,720
Speaker 3: be codifying the work of the Doge, not two trillion dollars,

779
00:41:15,120 --> 00:41:19,080
Speaker 3: but nine point four billion. You look at the big

780
00:41:19,120 --> 00:41:22,719
Speaker 3: beautiful bill which was supposed to lower debt and deficits.

781
00:41:22,760 --> 00:41:25,640
Speaker 3: And there are still a number of folks in Washington

782
00:41:25,640 --> 00:41:28,359
Speaker 3: who will say in the administration, Republicans on Capitol Hill

783
00:41:28,400 --> 00:41:31,080
Speaker 3: will say that it does when you factor in certain

784
00:41:31,160 --> 00:41:34,360
Speaker 3: levels of growth and returns from terrace. But the Congressional

785
00:41:34,360 --> 00:41:37,480
Speaker 3: Budget Office, every major economist, all of the thing tanks

786
00:41:37,480 --> 00:41:40,440
Speaker 3: here in Washington say that it allowed trillions to the

787
00:41:40,480 --> 00:41:43,640
Speaker 3: debt and deficit. This cost cutting thing, Genie, turns out

788
00:41:43,680 --> 00:41:45,919
Speaker 3: to be kind of difficult. Huh.

789
00:41:46,040 --> 00:41:49,399
Speaker 6: Yeah, it certainly does. And you can take any one

790
00:41:49,440 --> 00:41:52,919
Speaker 6: of those areas you just mentioned, and we can talk

791
00:41:52,920 --> 00:41:58,160
Speaker 6: about the impact on particular constituencies of these representatives and senators,

792
00:41:58,400 --> 00:42:01,759
Speaker 6: but let's also look at them of the most vulnerable

793
00:42:01,880 --> 00:42:06,160
Speaker 6: in our communities. As it pertains to public health. This

794
00:42:06,400 --> 00:42:10,799
Speaker 6: intent to cut and gut Medicaid and Medicare will be

795
00:42:10,920 --> 00:42:15,480
Speaker 6: devastating in rural hospitals. It'll be devastating for large populations

796
00:42:15,880 --> 00:42:19,360
Speaker 6: of elderly young people. And then let's jump over to

797
00:42:19,360 --> 00:42:21,759
Speaker 6: look at something we all should have an interest in,

798
00:42:21,880 --> 00:42:26,680
Speaker 6: and that is something involving our environment clean energy. We're

799
00:42:26,719 --> 00:42:30,799
Speaker 6: looking at COP thirty in November in Brazil and we

800
00:42:30,920 --> 00:42:35,279
Speaker 6: are gonna apparently send a contingent to that maybe go

801
00:42:35,360 --> 00:42:38,239
Speaker 6: down there. If they pass this bill, they will have

802
00:42:38,400 --> 00:42:43,320
Speaker 6: destroyed things that were intent on giving green energy tax

803
00:42:43,360 --> 00:42:46,960
Speaker 6: credits and other avenues by which we could move to clean,

804
00:42:47,040 --> 00:42:51,120
Speaker 6: green energy and allow all of us to live longer

805
00:42:51,239 --> 00:42:53,840
Speaker 6: and in a better and healthier state around the world.

806
00:42:54,160 --> 00:42:58,320
Speaker 6: So the impacts of this thing are devastating from many perspectives.

807
00:42:58,680 --> 00:43:02,320
Speaker 6: And yet you see even Tom Massey says it's likely

808
00:43:02,360 --> 00:43:05,080
Speaker 6: going to get through in some shape or another. And

809
00:43:05,160 --> 00:43:09,040
Speaker 6: so it is something that you just watch it go

810
00:43:09,239 --> 00:43:13,759
Speaker 6: on and you realize the devastation that is embedded in

811
00:43:13,960 --> 00:43:17,480
Speaker 6: a bill this big in the interest of saving money

812
00:43:17,520 --> 00:43:21,200
Speaker 6: for wealthy and big business, and that is a I

813
00:43:21,239 --> 00:43:23,960
Speaker 6: think a tremendous disservice to the entire community.

814
00:43:24,960 --> 00:43:27,680
Speaker 3: Well, I know you've been through a few of these rounds, Lisa,

815
00:43:27,800 --> 00:43:31,920
Speaker 3: when it comes to big promises in cutting spending. But

816
00:43:32,000 --> 00:43:34,880
Speaker 3: it is likely that this bill is going to pass,

817
00:43:35,040 --> 00:43:36,880
Speaker 3: at least in its current form when it comes to

818
00:43:36,920 --> 00:43:40,560
Speaker 3: tax and spend levels, minus some adjustments around the edges.

819
00:43:40,840 --> 00:43:44,279
Speaker 3: The missing component is revenue from tariffs. According to a

820
00:43:44,320 --> 00:43:48,160
Speaker 3: lot of Republican lawmakers who we talk to, and right

821
00:43:48,160 --> 00:43:51,120
Speaker 3: now the Trump team is in talks with China to

822
00:43:51,160 --> 00:43:54,439
Speaker 3: try to craft a trade deal. How do these all

823
00:43:54,520 --> 00:43:57,480
Speaker 3: reconcile and well tariffs actually help to make the difference?

824
00:43:59,680 --> 00:44:02,399
Speaker 13: Oh, I mean, I think that that's the hope out

825
00:44:02,400 --> 00:44:04,279
Speaker 13: of the White House. I think their expectation is that

826
00:44:04,320 --> 00:44:07,080
Speaker 13: it will definitely make the difference. The other thing too,

827
00:44:07,239 --> 00:44:09,640
Speaker 13: is that you know, when Genie talks about the fact

828
00:44:09,640 --> 00:44:11,120
Speaker 13: that we have all these other things that are in

829
00:44:11,200 --> 00:44:13,640
Speaker 13: the bill that are going to cause concern. If you

830
00:44:13,719 --> 00:44:16,040
Speaker 13: walk outside of this beltway and you ask people out

831
00:44:16,440 --> 00:44:20,000
Speaker 13: out in the districts what they care about. They want change,

832
00:44:20,239 --> 00:44:22,440
Speaker 13: and they don't they're not really sure what it takes

833
00:44:22,480 --> 00:44:25,160
Speaker 13: to make change, but they're willing to take a chance

834
00:44:25,560 --> 00:44:29,560
Speaker 13: that these new, unconventional ways are the ways to make change.

835
00:44:29,640 --> 00:44:33,520
Speaker 13: And so they're not willing to take opportunities as it

836
00:44:33,560 --> 00:44:37,880
Speaker 13: relates to climate change and other risky kinds of ideas

837
00:44:37,920 --> 00:44:41,160
Speaker 13: that they think about until in fact their basic needs

838
00:44:41,160 --> 00:44:44,200
Speaker 13: are met. And so if costs can come down, if

839
00:44:44,239 --> 00:44:46,560
Speaker 13: tariffs are going to make that difference, I'm not really

840
00:44:46,560 --> 00:44:48,799
Speaker 13: sure they care about how the sausage is made gel

841
00:44:48,880 --> 00:44:52,040
Speaker 13: provided that the change happens and happens in a way

842
00:44:52,080 --> 00:44:54,799
Speaker 13: that helps them and helps their bottom line. So, while

843
00:44:54,800 --> 00:44:57,239
Speaker 13: we all existentially know that all of these other things

844
00:44:57,239 --> 00:44:59,759
Speaker 13: that Genie mentioned are part of the bill and are problematic,

845
00:45:00,160 --> 00:45:01,719
Speaker 13: people want basic needs met.

846
00:45:06,640 --> 00:45:09,879
Speaker 3: Thanks for listening to the Balance of Power podcast. Make

847
00:45:09,880 --> 00:45:12,840
Speaker 3: sure to subscribe if you haven't already, at Apple, Spotify,

848
00:45:12,920 --> 00:45:15,520
Speaker 3: or wherever you get your podcasts, and you can find

849
00:45:15,560 --> 00:45:19,279
Speaker 3: us live every weekday from Washington, DC at Noontimeeastern at

850
00:45:19,280 --> 00:45:20,560
Speaker 3: Bloomberg dot com.