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Speaker 3: The Russian response to Ukraine's use of US provided attack
Speaker 3: EM's missiles across the border, striking offensively against Russia, which
Speaker 3: prompted a reaction from Vladimir Putin lowering the threshold for
Speaker 3: a nuclear strike in response to a broader range of
Speaker 3: conventional attacks. Now, the US response right now is no response.
Speaker 3: As I mentioned earlier, it recalls the movie War Games.
Speaker 3: The only way to win is not to play. But
Speaker 3: it's pretty hard to not play when things are unfolding
Speaker 3: before your eyes like this. And that's where we want
Speaker 3: to start our conversation with Chuck Fleischman, the Republican congressman
Speaker 3: from Tennessee's third District, is with US live from Capitol
Speaker 3: Hill right now. Congressman, it's good to see you. Welcome
Speaker 3: back to Bloomberg. I'm supposed to ask you about this
Speaker 3: funding deadline, and we'll get to that. I have a
Speaker 3: lot of questions about the Lame Duck, but you have
Speaker 3: an important viewpoint on this story as co chair of
Speaker 3: the Nuclear Security Working Group and from your position with
Speaker 3: your specialty and energy, I know you're focused on this closely.
Speaker 3: How important? How dangerous is this development today that you're
Speaker 3: seeing coming out of Russia with a new nuclear doctrine.
Speaker 4: This is very dangerous.
Speaker 5: The rhetoric from Vladimir Putin over the past several months,
Speaker 5: including today, has been very dangerous in terms of threatening
Speaker 5: the use.
Speaker 4: Of a nuclear weapon.
Speaker 5: This should be condemned universally across the world because we
Speaker 5: cannot have that kind of talk coming from any of
Speaker 5: the nuclear leaders in the world. Russia has a nuclear arsenal,
Speaker 5: sure you. The United States has the best, strongest nuclear arsenal.
Speaker 5: I fund it through the Department of Energy, the NNSA.
Speaker 5: We are well prepared, but we want to make sure
Speaker 5: that we lower the temperature and have a strong statement
Speaker 5: that there can never be the use of a nuclear weapon,
Speaker 5: even a tactical nuclear weapon, a smaller one on the battlefield.
Speaker 5: It would escalate beyond what we could just even fathom.
Speaker 5: It's ridiculous, it's wrong. It must be condemned.
Speaker 3: What do you make of the response, the non response,
Speaker 3: if you will, from the US Congressman. And how worried
Speaker 3: are you that Vladimir Putin will try to take advantage
Speaker 3: of the remainder of the Biden administration to do some
Speaker 3: damage here before Donald Trump is in office.
Speaker 5: Well, I can't wait for January twentieth to get here.
Speaker 5: This is why I believe that President Trump will get
Speaker 5: in sit down with Zelensky and with Putin and bring
Speaker 5: this horrific situation, this sad chapter in world history, to
Speaker 5: a close. But the reality is, we've got to be
Speaker 5: very careful day to day. We do not want this
Speaker 5: to escalate, to spread, and God forbid, we do not
Speaker 5: want to see the use of a nuclear weapon on
Speaker 5: the battlefield or anywhere else. That's why we have a
Speaker 5: strong nuclear deterrent in our country. That's why we have
Speaker 5: built that up. But for Putin to engage in this
Speaker 5: type of rhetoric is wrong.
Speaker 4: He needs to pull it back.
Speaker 3: Well, do you think this strengthens the use of the
Speaker 3: attack of strengthens President Zelenski's hand if he is about
Speaker 3: to approach the negotiating table with Donald Trump and Vladimir Putin,
Speaker 3: Assuming that happens because when we look at the map
Speaker 3: of territory that's been occupied by Russia, that seems to
Speaker 3: be a lot to ask for the Ukrainians. In fact,
Speaker 3: they say they won't entertain handing that landover, whether it's
Speaker 3: the Donbass or Crimea.
Speaker 5: What do you think, Well, there's absolutely no question that
Speaker 5: on the ground, if you look at the Ukrainian map
Speaker 5: that the Russians have made tremendous gains across the country,
Speaker 5: there's been.
Speaker 4: A tremendous cost to them.
Speaker 5: Their casualties are high, they've gotten even higher.
Speaker 4: This has not been.
Speaker 5: An easy war for Putin. His losses are horrific, so
Speaker 5: he's probably looking for an exit strategy.
Speaker 4: I will say this.
Speaker 5: Ukraine has lost a lot of land. There's probably going
Speaker 5: to have to be some type of a compromise. I
Speaker 5: think the only person with credibility to get both parties
Speaker 5: to the table is Donald Trump. The rest of the
Speaker 5: world has basically been engaged in a very sad spectator sport.
Speaker 5: Trump will probably put this to an end quickly. But
Speaker 5: I don't know what that compromise looks like. But we
Speaker 5: have got to stop the carnage.
Speaker 3: Well, Congressman, you're back in Washington with your colleagues here
Speaker 3: with the to do list in the lame duck session,
Speaker 3: and I would love to get into some of the asks,
Speaker 3: beginning with funding the government. You know everyone's going to
Speaker 3: start running their countdown clocks. Tomorrow is one month out
Speaker 3: from December twenty and the lapse of funding. There is
Speaker 3: a debate right now about whether you should clear the
Speaker 3: decks for Donald Trump by extending, by kicking the can
Speaker 3: well into next year. Some say March, some say September.
Speaker 3: Others say no, Donald Trump should have a hand in
Speaker 3: running the next budget that comes to the nation.
Speaker 5: What do you think, Well, I think we need to
Speaker 5: hear from President Trump on this. I'm very solicitous of
Speaker 5: his thoughts. The fiscal year began for our country October first.
Speaker 5: We have a continuing resolution, as you alluded to, to December twentieth.
Speaker 5: By that time, we either have to have a budget
Speaker 5: in place and a deal or go into next year.
Speaker 5: It'd be my vote to basically get it done this year.
Speaker 5: President Trump's going to have a lot on his plate
Speaker 5: with budget reconciliation, with taxes and other issues that the nation.
Speaker 4: The border has to be addressed.
Speaker 5: We don't want to necessarily have this appropriation situation on
Speaker 5: his plate.
Speaker 4: Unless he wants it on his plate.
Speaker 5: So the reality is, the sooner we get a budget done,
Speaker 5: the better clean it up and let President Trump go
Speaker 5: into a new, clean administration a new year. However, if
Speaker 5: President Trump feels differently, we'll be glad to entertain that.
Speaker 3: Okay, So, if it we're up to you, would you
Speaker 3: prefer March or September? And would that continuing resolution include
Speaker 3: the millions of dollars the hundreds of millions that the
Speaker 3: Biden administration asked for to clean up from the hurricanes
Speaker 3: that partially impacted your state.
Speaker 5: Well, certainly we need disaster relief. I don't know what
Speaker 5: that passage looks like. President Biden put forth a letter
Speaker 5: today to the Speaker of the House in that regard. Ultimately,
Speaker 5: I think we need some type of disaster relief, but
Speaker 5: that would be in terms of a supplemental addition to
Speaker 5: the budget. My preference would be get a deal done
Speaker 5: on the overall appropriations package by December twentieth.
Speaker 4: There's some problems with that.
Speaker 5: Practically, though the House and Senate are one hundred billion
Speaker 5: dollars apart, the Senate is much higher. I don't know
Speaker 5: whether or not Senator Schumer would deal. He'd be a
Speaker 5: fool not to deal, giving what we're going to see
Speaker 5: with Republicans in charge of the House, Senate and White
Speaker 5: House next year. But once again, I think the sooner
Speaker 5: we get a budget for our country, the better. I
Speaker 5: would have preferred to see a budget September thirtieth, going
Speaker 5: into October first. We didn't get that, so I would
Speaker 5: take December twentieth, but if not, we'll go into March.
Speaker 3: That's the view from a member of the Appropriations Committee.
Speaker 3: We should note, with your interest in energy, Congressman and
Speaker 3: your position in Congress, I would love to hear from
Speaker 3: you on Donald Trump's pick for the Energy Department. Everyone
Speaker 3: is obsessing over a lot of other picks, but not
Speaker 3: so much Chris Wright. He's the CEO of Liberty Energy,
Speaker 3: said to be an innovator when it comes to fracking,
Speaker 3: and someone who will look to undo the Inflation Reduction
Speaker 3: Act and some of the incentives that came along with it.
Speaker 3: Is he the right pick for the job?
Speaker 5: Well, I applaud President Elect Trump for this choice.
Speaker 4: I don't know Wright. We have reached out.
Speaker 5: Hopefully I'll be able to speak with him because my subcommittee,
Speaker 5: the Energy and Water Subcommittee, will fund the Department of Energy,
Speaker 5: which includes the NNSA, which has the nuclear arsenal, but
Speaker 5: also all of the energy endeavors. So I do look
Speaker 5: forward to meeting and visiting with mister Wright, as well
Speaker 5: as Governor Burgham, who's going to chair the Energy Council.
Speaker 5: He's going to have Interior, but he's also going to
Speaker 5: have this special new executive.
Speaker 4: Branch Energy Council.
Speaker 5: Ultimately, I'll be responsible for funding or not funding those endeavors.
Speaker 5: But a good choice looks like an oil and gas person.
Speaker 5: He's got good competence, he's got good business experience.
Speaker 4: I was also pleased to see that he tends to
Speaker 4: be pro nuclear. That's my space in Congress.
Speaker 5: I'm the most pro nuclear power congress person in Congress.
Speaker 5: I'm looking for somebody with whom I can continue that
Speaker 5: great work that has been bipartisan by Cameron and has
Speaker 5: gone through several administrations to promote American.
Speaker 3: Nuclear I've been seeing a video that mister Wright said
Speaker 3: there is no climate crisis and we are not in
Speaker 3: the midst of an energy transition either. It's a quote
Speaker 3: that has been repeatedly used over the past couple of
Speaker 3: days since Donald Trump mentioned his name. I won't try
Speaker 3: to relitigate the climate element with you here, but when
Speaker 3: we talk about energy transition, he's presumably talking about green
Speaker 3: will he in fact bring an energy transition back to nuclear? Congressman,
Speaker 3: you just brought this up, and we know that the
Speaker 3: great need for clean and renewable energy here and in
Speaker 3: this case, uninterruptible energy from a nuclear source for the
Speaker 3: data centers that are popping up like weeds all over
Speaker 3: the country will have to be addressed in this next administration.
Speaker 3: What would the new Energy secretary do and what would
Speaker 3: you do in Congress to help him to that end?
Speaker 4: Well, I thank you for that question.
Speaker 5: I have worked with the Obama administration, the Trump administration,
Speaker 5: and the Biden administration on a pro nuclear portfolio. All
Speaker 5: three secretaries major Secretaries of Energy, whether it's Monice Perry
Speaker 5: or Grand Home, have worked with me on those endeavors.
Speaker 5: So we have moved forward this bipartisan and by caramel
Speaker 5: support for that. I would expect that to continue under
Speaker 5: Secretary right because I know that President Trump is infinitely
Speaker 5: pro new nuclear, so that is important.
Speaker 4: So it's going to be a continuation.
Speaker 5: Of the funding model I have out for Fiscal twenty five,
Speaker 5: built on Fiscal twenty four, it's a good, solid, pro
Speaker 5: nuclear portfolio. Nuclear energy will be part of clean, carbon free, reliable,
Speaker 5: resilient energy. So I think we're going to continue to
Speaker 5: work in that direction, build on what we have. America
Speaker 5: has moved into the space. We're strong in this space,
Speaker 5: but we do need to get better. Our foes are
Speaker 5: good at it, our friends are good at it, so
Speaker 5: we need to continue to get better at it.
Speaker 3: Donald Trump is on his way to Texas for the
Speaker 3: big SpaceX starship launch. We're going to carry that here
Speaker 3: on Bloomberg around five o'clock and our remaining moment, Congressman,
Speaker 3: from your perch on the Science Committee, how important is
Speaker 3: this flight test to succeed? For Elon Muskin, for NASA
Speaker 3: to continue their planning to go to Mars.
Speaker 5: I had the privilege of meeting Elon Busk when President
Speaker 5: Trump brought him to our conference last week, and of course,
Speaker 5: what did I speak with Elon about nuclear energy?
Speaker 4: I gave my card and I said, let's talk nuclear But.
Speaker 5: I applaud Elon with what he's done. I wish him
Speaker 5: every success in his endeavors. In space, and I think
Speaker 5: NASA and the country and the world can learn from
Speaker 5: what he's doing. I applaud him, I compliment him, and
Speaker 5: I wish him future success.
Speaker 3: All the chopsticks are going to be waiting. Congressman, we'll
Speaker 3: all be watching together. Chuck Fleischman, Republican from Tennessee with
Speaker 3: US Live from Capitol Hill. It's good to see you, sir.
Speaker 3: Thank you for the insights today.
Speaker 2: On Bloomberg, you're listening to the Bloomberg Balance of Power
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Speaker 3: Donald Trump is headed to Texas today. You might have
Speaker 3: heard me mentioned with Congressman Chuck Fleischman on his way
Speaker 3: to Texas Brownsville for the big launch. This is SpaceX Starship.
Speaker 3: Five pm Eastern time is the start of the launch window.
Speaker 3: We're going to carry this for you. This is the
Speaker 3: latest flight test that you heard Donald Trump talking about.
Speaker 3: Remember the chopsticks. On the last one, the booster comes
Speaker 3: back down, they catch it at the pad all that's
Speaker 3: supposed to happen, and the weather is looking good, So
Speaker 3: between five and five thirty pm Eastern time, you know,
Speaker 3: you can always count on Bloomberg to bring you these launches.
Speaker 3: This is a big one that you've got the President
Speaker 3: elect there with the buddy in chief, Elon Musk, all
Speaker 3: watching the launch. And a lot of this, of course
Speaker 3: has to do with our return to the Moon, with
Speaker 3: our return to Mars, and each stage, each flight test
Speaker 3: is critically important to stay on track. So we're gonna
Speaker 3: have a lot more from Texas a little bit later
Speaker 3: on today, as reality may be setting in at mar
Speaker 3: A Lago, not about SpaceX or Elon Musk, but about
Speaker 3: Matt Gates headline of the New York Times. Gates may
Speaker 3: not be confirmed, Trump admits he's pushing him in others anyway.
Speaker 3: Maggie Haberman Jonathan Swan reporting that Donald Trump has been
Speaker 3: on the phone, specifically calling senators to pressure them, knowing
Speaker 3: that we may have even odds here in getting Matt Gates,
Speaker 3: the now former Florida congressman, approved to run the Department
Speaker 3: of Justice. It's where we start our conversation with our
Speaker 3: political panel. Genie Shanzino is back with US today, senior
Speaker 3: Democracy fellow with the Center for the Study of the
Speaker 3: Presidency in Congress. Of course, Democratic analyst Bloomberg Politics contributor,
Speaker 3: and Lisa Camuso Miller, Republican strategist, former RNC communications director
Speaker 3: and host of the Friday Reporter podcast. Prepare for a
Speaker 3: great conversation. Great to see both of you. Hear Genie
Speaker 3: your thought on this. We've been talking about Matt Gaetz
Speaker 3: since last week when the name first dropped.
Speaker 4: Here.
Speaker 3: Donald Trump is hearing all the same stuff that we are,
Speaker 3: but is now appealing directly to senators.
Speaker 6: Will it work, We don't know yet.
Speaker 2: You know.
Speaker 6: The reality is is that these allegations, particularly for somebody
Speaker 6: who is nominated to be the Attorney General of the
Speaker 6: United States, the chief law enforcement official, whether these allegations
Speaker 6: are true or not, and of course he denies them,
Speaker 6: these are disqualifying. I mean, think back twenty years Tom
Speaker 6: Dashel loses the nomination because he didn't pay taxes, you know,
Speaker 6: Bill Richardson, That's how it used to work. Now we've
Speaker 6: got somebody who is accused of these you know, crimes.
Speaker 6: They are true, and again he says they are not
Speaker 6: these would be disqualifying. But the reality is you've got
Speaker 6: members of Congress who say, or the Senate who say
Speaker 6: that they want to give the president's nominees a fair hearing,
Speaker 6: and we'll have to see if that's true. But the
Speaker 6: reality is is that Donald Trump, here's what we're all hearing,
Speaker 6: and that is these are disqualifying allegations, less.
Speaker 3: Than even odds of being confirmed to the Senate. The
Speaker 3: line and Maggie Haberman and Jonathan Swan's column Lisa Enter
Speaker 3: Elon Musk, who is not only supporting Matt Gates, but
Speaker 3: he takes to Twitter to x and writes he is
Speaker 3: the judge dread America needs to clean up a corrupt
Speaker 3: system and put powerful bad actors in prison. Gates will
Speaker 3: be our hammer of justice. How comic book is this
Speaker 3: going to get in the next.
Speaker 1: Couple weeks, Well till we're definitely on another side of things,
Speaker 1: There's no question about it. And the thing about this
Speaker 1: nomination is that I think we're all waiting to see.
Speaker 1: Right there are definitely a lot of questions about whether
Speaker 1: or not Matt Gates can be confirmed, But also too,
Speaker 1: don't forget that we're living in a very different time.
Speaker 1: Donald Trump has got the control of the Senate, he's
Speaker 1: got control of the House, but he also really likes
Speaker 1: to win, and so to me, I think that he's
Speaker 1: hearing everything that we're hearing. I think he's still very
Speaker 1: much behind Matt Gates as a candidate for attorney general.
Speaker 1: He's going to do everything he can to see that
Speaker 1: he can make that happen. But also too, he's not
Speaker 1: going to go far enough. He's not going to go
Speaker 1: so far that he's going to lose that nomination himself
Speaker 1: and have to go back to the drawing board. So
Speaker 1: I think a lot of things are up in the air.
Speaker 1: Like Jeanie said, I think we just don't yet know,
Speaker 1: so we have to continue to watch. But I do
Speaker 1: think that there are a lot of things in his
Speaker 1: favor that are happening, and that is that he's got
Speaker 1: people like Elon Musk, and he's got, by the way,
Speaker 1: the support of the base of the party really behind him.
Speaker 4: Right.
Speaker 1: I had someone tell me the other day that even
Speaker 1: the folks who aren't really paying very close attention to
Speaker 1: Matt Gates are saying that they're in face of him
Speaker 1: because he is an outside of the box candidate and
Speaker 1: so that too, is something that has to be fueling
Speaker 1: Donald Trump's thought process as it goes through and as
Speaker 1: he continues to make bone calls to the US Senate
Speaker 1: about confirm it.
Speaker 3: Now. Of course, the Ethics Committee is going to meet
Speaker 3: tomorrow about whether or not to release this report. Genie
Speaker 3: Speaker Johnson says no, it would set a horrible precedent
Speaker 3: for former members, even though there are some instances where
Speaker 3: this has happened before. But the top Republican on this committee,
Speaker 3: the chair, Michael Guess, says he doesn't care, and the
Speaker 3: panel will act independent of whatever the speaker says based
Speaker 3: on when they meet the ranking member. His Democratic counterpart,
Speaker 3: Susan Wilde, says she wants the report out. So we
Speaker 3: can all agree this is going to happen, right, whether
Speaker 3: it takes place publicly for the committee or the lawyer
Speaker 3: is out there talking on behalf now of four women
Speaker 3: apparently connected to Matt Gates or as you put yesterday
Speaker 3: in the FBI report. So this information will be available
Speaker 3: to senators who make this decision, right, Oh.
Speaker 6: It absolutely will be. I mean the FBI check alone,
Speaker 6: they're going to be able to pick up as much,
Speaker 6: if not more, quite frankly than was picked up in
Speaker 6: the House Ethics the House Ethics Committee. We don't know
Speaker 6: if they'll release it, but don't forget there's ten members
Speaker 6: of the committee, twenty eight or twenty nine staffers, the
Speaker 6: ranking member on the Democratic side. You just mentioned wild
Speaker 6: lost reelection. You know, what's to stop any of these
Speaker 6: people from releasing two journalists? You know parts of this
Speaker 6: or in full. So I think we get it out here.
Speaker 6: But I think part of the troubling aspect of all
Speaker 6: of this and whether we're talking about you know this
Speaker 6: nominee Matt Gaetz or Peter Hegseth in DoD as, we
Speaker 6: are not talking about qualifications to run these departments. All
Speaker 6: of the focus has been on these allegations of sexual
Speaker 6: misconduct than otherwise obviously disqualifying. But it should also be
Speaker 6: distinguished that these are massive departments. I mean, the DoD
Speaker 6: alone eight hundred billion dollar annual budget. What qualifications does
Speaker 6: somebody like Pete Hegseth have to run that department? Two
Speaker 6: million people? He'd be responsible for that the DoD employees.
Speaker 6: Maybe he has those qualifications, but we don't care about
Speaker 6: them or talk about them because all of the focus
Speaker 6: once again has been on these you know, sort of
Speaker 6: really troubling allegations, disqualifying but not having to do with
Speaker 6: the qualifications of these individuals. And that's not to mention
Speaker 6: Tulci Gabbert or of course maybe the worst defender RFK Junior,
Speaker 6: who has, you know, zero qualifications in the area of
Speaker 6: health and human services. A good attorney on environment, but
Speaker 6: not health in human services.
Speaker 3: You start to wonder if back Gates the best thing
Speaker 3: that ever happened to Pete Hegseth or our FK Junior, Lisa,
Speaker 3: considering the fact that heg Seth reportedly paid to settle
Speaker 3: a sexual assault case. Lisa, you worked for a Republican
Speaker 3: speaker in Denny Haster. You know how this stuff works.
Speaker 3: When Mike Johnson says, I don't want the ethics report released,
Speaker 3: what does that mean? When the chairman says we're going
Speaker 3: to do it anyway.
Speaker 1: Well, Joe, there used to be a joke in Washington.
Speaker 1: I don't know that it's still the case. But if
Speaker 1: you want a story told, tell somebody on Capitol Hill.
Speaker 1: And it certainly is the case. I mean, these kinds
Speaker 1: of things definitely have a way of making themselves into
Speaker 1: the conversation. But you know, and I'm reflecting on what
Speaker 1: Genie said, I'm reflecting on sort of the way we've
Speaker 1: covered Donald Trump for all these years. The truth is
Speaker 1: that I think we're falling in the same We're falling
Speaker 1: into the same trap, and that is that, yes, there
Speaker 1: is a process for confirmation. There is a process that
Speaker 1: involves the FBI, involves background checks and all of those
Speaker 1: other things, and ordinarily those are disqualifiers. But look, in
Speaker 1: a resounding way, the American electorate voted for Donald Trump
Speaker 1: and put him back in office in charge of the
Speaker 1: biggest in the biggest job there ever was. So to me,
Speaker 1: we also have to reflect on the fact that this
Speaker 1: is sort of a continuation of a conversation we probably
Speaker 1: need to be having, and that's what is it that's
Speaker 1: qualifying and disqualifying in these jobs in this day and age.
Speaker 1: Do I think that we should refer back to the
Speaker 1: way that they can once we're absolutely and Jeanie and
Speaker 1: I and you Joe have been watching this long enough
Speaker 1: to know that that's the way that this business is done.
Speaker 1: And thank goodness, there are processes in place that will
Speaker 1: hopefully catch some of these candidates that perhaps aren't the
Speaker 1: best qualified for these jobs. But also too, let's not
Speaker 1: fall into the trap of following all of the side
Speaker 1: noise and the outside noise that's conflating the fact that
Speaker 1: Donald Trump is still fighting for all of these candidates,
Speaker 1: and so far his record has been pretty good over
Speaker 1: the course of the last couple of months and years.
Speaker 3: So I'm glad you said all of that, Lisa, finish
Speaker 3: the thought, then, what are the chances that all three
Speaker 3: heg Seth Gates, RFK Junior are confirmed? Because Donald Trump
Speaker 3: says he's got the mandate to make that happen.
Speaker 1: You've heard me say it too. I think the rules
Speaker 1: are different. I think the playbook is different, and I
Speaker 1: think that you know, if Donald Trump has his mindset
Speaker 1: on getting these people into place, He's going to do
Speaker 1: what he has in his power as the President of
Speaker 1: the United States to do that. At the horror and
Speaker 1: the shock of all the people inside of washing in DC,
Speaker 1: including myself, who are concerned about these people as candidates
Speaker 1: that should be in these roles, and so to me,
Speaker 1: I think that the chance if there's I mean goodness knows,
Speaker 1: my crystal ball is as clear as anybody's in this town. Joe,
Speaker 1: But I'll say this that I think that it's very
Speaker 1: possible that we could see these kinds of people get
Speaker 1: into these roles more readily than ever before in the
Speaker 1: history of the United States.
Speaker 4: Yeah, well, all right, Jennie.
Speaker 3: What role do Democrats then play on the committees that
Speaker 3: are having these hearings. Do Democrats throw their hands up
Speaker 3: and say, you know what you want this team, go ahead,
Speaker 3: let's see where you are in two years, clear them?
Speaker 3: Or is there going to be a real throw down,
Speaker 3: a real fight by Democrats knowing that they will likely
Speaker 3: be confirmed anyway, Well, they.
Speaker 6: Will continue to be the loyal opposition. I think you
Speaker 6: look at the Judiciary Committee. Poor ninety one year old
Speaker 6: Chuck Gresley is the incoming chair of that has got
Speaker 6: to manage this, and you're going to see Dick Durbin
Speaker 6: and the Democrats. They are going to call if Matt
Speaker 6: Gates comes to a to the Judiciary Committee, they will
Speaker 6: call witnesses. They will make this a spectacle. They will
Speaker 6: make Republicans go on the record and say they support
Speaker 6: somebody who is charged with sex with an underage woman
Speaker 6: or girl, who has paid for sex, who has used
Speaker 6: illegal drugs, all of these allegations. So these are going
Speaker 6: to be hearings of the kind you know, just think
Speaker 6: back to Clarence Thomas Anita Hill. That's what they will do,
Speaker 6: and that's what the Republicans are so so not looking
Speaker 6: forward to. That's one reason why some of them want
Speaker 6: the report to come back, come out. They're hoping that
Speaker 6: they can avoid having to go through this hearing. But
Speaker 6: these will be hearings for all of us to watch
Speaker 6: and all of us to see. But again, what we
Speaker 6: won't be talking about is what Donald Trump is saying
Speaker 6: he's going to be doing, including yesterday that he will
Speaker 6: use the US military to deport people who are here illegally.
Speaker 6: Regardless of what you think about immigration, the use of
Speaker 6: the military domestically, that is an enormous change in the
Speaker 6: way we run this country, he said on truth Social yesterday,
Speaker 6: Absolutely true when somebody posted he would do that, and
Speaker 6: that has sort of gone sort of under reported, under disgust,
Speaker 6: under you know, like just imagined what would that would
Speaker 6: be like, the US military out in full force because
Speaker 6: of the you know, the real, real nasty allegations we're
Speaker 6: hearing on the other side, and that has should be balanced.
Speaker 6: We should try to balance both of them. But I'll
Speaker 6: tell you, if these hearings come to fruition, there will
Speaker 6: be no balancing. We will all be all in on
Speaker 6: Matt Gates because it's going to be wild.
Speaker 3: Oh I got yeah, just wait to cover these hearings.
Speaker 3: This is a great panel and a really smart conversation.
Speaker 3: I appreciate Lisa Camussa Miller and Genie Shanzano. Thank you
Speaker 3: so much both for the insights.
Speaker 2: You're listening to the Bloomberg Balance of Power podcast Ketch
Speaker 2: just live weekdays at noon Eastern on Evo, CarPlay and
Speaker 2: then Froudoto with the Bloomberg Business app. Listen on demand
Speaker 2: wherever you get your podcast a. Watch us live on YouTube.
Speaker 3: We'll have tabs on the markets for us throughout the
Speaker 3: hour here as we cover politics from Washington, DC. We
Speaker 3: saw a bit of a swoon in the market earlier
Speaker 3: with the news from Ukraine using the attack of missiles
Speaker 3: provided by the US offensively against Russia, which is announcing
Speaker 3: a new nuclear doctrine, though it does seem that the
Speaker 3: markets have settled a bit since then turning to the
Speaker 3: matter at hand in Washington. That's the transition, of course,
Speaker 3: in the looming confirmation battles for some of the more
Speaker 3: controversial figures who Donald Trump has named, beginning with former
Speaker 3: Congressman Matt Gates, tapped to run the Department of Justice
Speaker 3: to be the next Attorney General. As Kaylee mentioned, Congressman
Speaker 3: Sean Caston, a Democrat from Illinois, is leading a letter
Speaker 3: from House Democrats urging the Ethics Committee to release its
Speaker 3: report into Matt Gates. Knowing that the Ethics Committee will
Speaker 3: be voting on this matter tomorrow and that the Speaker
Speaker 3: of the House, Mike Johnson, has called on the committee
Speaker 3: to keep that report under wraps. Congressman Caston joins US
Speaker 3: now live from Capitol Hill. Congressman, it's good to see you.
Speaker 3: This report seems to be the worst kept secret in Washington.
Speaker 4: Do you know what's in there?
Speaker 3: When it keep Matt Gates from being the next Attorney General.
Speaker 7: So the report has not been released. The Ethics Committee,
Speaker 7: by tradition, keeps a tight hold on these things. We've
Speaker 7: seen the leaks that have come out as you have.
Speaker 7: We've seen the stories about people saying that seventeen year
Speaker 7: old girls were drugged and statutorily raped at parties by
Speaker 7: Matt Gates. We've not seen what's in the report. The
Speaker 7: Ethics Committee has the authority to release that report, and
Speaker 7: I think what scares a lot of us is that
Speaker 7: we saw the last time that the Trump was in
Speaker 7: the White House that he not only surrounds himself with
Speaker 7: sexual predators, people who are credibly accused of sexual assault,
Speaker 7: but suppresses that information. Remember he suppressed the FBI investigation
Speaker 7: into Brett Kevinaugh. Remember that Donald Trump himself is an
Speaker 7: adjudicated rapist. And so if we don't compel the release
Speaker 7: of that information, we have no guarantee that a Republican
Speaker 7: led Senate will actually care about whether an attorney general
Speaker 7: in the United States has been accused of sexual assault.
Speaker 7: So we need to get the information out there. We
Speaker 7: need to make sure that the Senate has the tools
Speaker 7: to fulfill their advice and consent function, and then make
Speaker 7: sure that we put public pressure on them to ensure
Speaker 7: that they do.
Speaker 8: Well.
Speaker 9: Of course, we should note that the former Congressman Matt
Speaker 9: Gates has denied any wrongdoing amid these allegations, and even
Speaker 9: attorneys for two of the alleged people that had relations
Speaker 9: with Matt Gates have said their interactions were consensual. But
Speaker 9: Congressman as we consider this here knowing that the Speaker
Speaker 9: has said this would set a bad precedent. As mister
Speaker 9: Gates is no longer a member of the House of Representatives,
Speaker 9: is there a precedent concern here? Could the House Ethics
Speaker 9: Committee in the future be used in a way that
Speaker 9: it was not intended to if this is done.
Speaker 7: Look Number one, the House Ethics Committee does have a
Speaker 7: history in past years. They have real reports after members
Speaker 7: have come out. Number two, Make no mistake, Matt Gates
Speaker 7: is an extremely smart guy. He is also less than
Speaker 7: completely honest. All of us understood that he resigned early
Speaker 7: in order to avoid this report coming to light. If
Speaker 7: he is nervous about what's in the report, that speaks volumes.
Speaker 7: And with respect to mister Johnson, I would simply point
Speaker 7: out that mister Johnson told us when he was running
Speaker 7: for Speaker. If you want to know what I believe,
Speaker 7: just read the Bible when Jesus said, what you do
Speaker 7: unto the least of these, you do unto me. I
Speaker 7: wonder who Mike Johnson actually is thinking of by the
Speaker 7: least of these. If you have somebody Donald Trump raped
Speaker 7: a woman, is Mike Johnson going to look out for
Speaker 7: that or is he going to be a rubber stamp?
Speaker 7: Does he care that there are credible challenges as against
Speaker 7: Matt Gates. I wish this didn't sound partisan. I wish
Speaker 7: that we trusted the Republicans in the House and Senate
Speaker 7: to defend the least of these. But the fact that
Speaker 7: somebody is saying I am innocent, trust me, and please
Speaker 7: don't disclose the.
Speaker 4: Little dubious congressman.
Speaker 3: We heard from Elon Musk, who of course is playing
Speaker 3: a pretty big role in the transition of this administration.
Speaker 3: Apparently we'll play a large role once the administration is
Speaker 3: often running. He says that Matt Gates, quote is the
Speaker 3: judge dread America needs to clean up a corrupt system
Speaker 3: and put powerful bad actors in prison. Gates, he says,
Speaker 3: will be our hammer of justice. That's a direct quote,
Speaker 3: going on to say that the allegations that we're talking
Speaker 3: about here quote amount to less than nothing unquote. How
Speaker 3: would you respond to Elon Musk?
Speaker 7: Look, Elon Musk is not an elected official. Elon Musk
Speaker 7: is does not represent anybody, and hardly I think is
Speaker 7: a voice of reason in our society's I mean, he
Speaker 7: said that his own goal is to go live on Mars. Okay, fine,
Speaker 7: the only reason we're talking about Elon Musk is because
Speaker 7: he's rich. We have a separate question. Do we want
Speaker 7: the Attorney General of the United States to be somebody
Speaker 7: who has a dedicated commitment to ensuring that the law
Speaker 7: applies to every American equally without preference. That seems a
Speaker 7: very low bar. If your view is that the Attorney
Speaker 7: General's job is to be some comic book figure that
Speaker 7: is out to implement retribution, whatever that is, that is
Speaker 7: a deeply anti American idea.
Speaker 9: Congressman, we may care about Elon Musk because he is
Speaker 9: the richest man in the world, but he also happens
Speaker 9: to be a massive government contractor, including agreements between his
Speaker 9: company SpaceX and NASA. We're expected to see today and
Speaker 9: the President elect is expected to attend the launch of
Speaker 9: a heavy rocket, the sixth Starship launch, which of course
Speaker 9: is integral to NASA's efforts to hopefully one day get
Speaker 9: back to the Moon and then maybe to Mars. And
Speaker 9: I wonder how concerned you are about Elon Musk's more
Speaker 9: active role, it seems with this transition, with the President
Speaker 9: elect knowing that the government was reliant on him for
Speaker 9: many such endeavors.
Speaker 7: You know, I think there's a larger conversation there that
Speaker 7: is the concern about our campaign finance system in the
Speaker 7: wake of the Citizens United decision. What our the government
Speaker 7: that our founders intended the government that our laws were
Speaker 7: designed prior to Citizens United, is you had to disclose
Speaker 7: if you were spending money to elect political figures. There
Speaker 7: isn't Amolliment's clause in the Constitution you cannot be independently profiting,
Speaker 7: and we've hidden all that in the guts of our
Speaker 7: campaign finance system. A functioning Congress going into the next term,
Speaker 7: given all the circumstances you just described, were the richest
Speaker 7: person in the world put hundreds of millions of dollars
Speaker 7: to elect someone into government and is then running to
Speaker 7: get those contracts. A Congress fulfilling its duty as a
Speaker 7: check and balance, would have robust oversight, robust investigations, robust subpoenas,
Speaker 7: and if in fact SpaceX is the best technology to
Speaker 7: provide those needs and it's a fair and competitive bid process,
Speaker 7: there's nothing to worry about there. But I think we
Speaker 7: are all concerned having seen what happened in the last
Speaker 7: Congress that the leadership in the Republican Party is so
Speaker 7: petrified of making Donald Trump angry and so unwilling to
Speaker 7: stand up for those constitutional principles that we have to
Speaker 7: ask this question of is their corruption happening in the
Speaker 7: light of day that will be allowed to continue, which
Speaker 7: ruins this beautiful American Republic that all of us benefit from.
Speaker 7: This is bigger than just Elon muskett is the question of, like,
Speaker 7: do we want to make sure that there is no
Speaker 7: cash for favors in our politics? Congress has the ability
Speaker 7: to oversight and protect against that.
Speaker 4: I hope that we do well.
Speaker 3: Congressman, knowing that Elon Musk will have the ear of
Speaker 3: the president, do you find as silver lining potentially in
Speaker 3: what he might steer Donald Trump to when it comes
Speaker 3: to climate change, when it comes to the development of
Speaker 3: electric vehicles, for instance, and is there an opportunity to
Speaker 3: collaborate on nuclear when this new Congress and this new
Speaker 3: administration begin.
Speaker 7: We'll see, I, you know, speculating on an unappointed, unconfirmed
Speaker 7: person who's whispering in the ear of a political figure,
Speaker 7: I'm not sure that's hugely productive. I don't think that
Speaker 7: that Elon Musk's involvement in politics is because he wanted
Speaker 7: to convince Donald Trump to leve electric vehicles, right, So,
Speaker 7: you know, I think that's a third order question. I
Speaker 7: do think that a lot of us in the in
Speaker 7: the energy community are broadly concerned that the last time
Speaker 7: Trump was in the White House, he fought to raise
Speaker 7: the price of oil. You will recall he called the
Speaker 7: Saudi's and said, I need you to curtail production to
Speaker 7: raise the price of oil because it's hurting our oil manufacturers's.
Speaker 7: He's got voices in his head who are saying we
Speaker 7: were losing market share in the United States. Coal consumption
Speaker 7: United States is collapsing, Oil consumption is flat. They want
Speaker 7: to export because they can't compete in the United States.
Speaker 7: What we really need in the White House is someone
Speaker 7: who is committed to competitive markets, to making sure that
Speaker 7: the lowest cost technology wins. And what all of us
Speaker 7: know is that if you have a solar panel on
Speaker 7: your roof, you don't pay for electricity anymore. If you
Speaker 7: have a transmission wire that can connect your cheap electricity
Speaker 7: to a higher, higher priced part of the grid, then
Speaker 7: markets work. And I think what we also know is
Speaker 7: that the Trump administration is going to work very hard
Speaker 7: to raise the price of energy to protect the oil
Speaker 7: and gas sector that can't compete, and that's not only
Speaker 7: bad for the climate, it's also.
Speaker 4: Bad for the economy.
Speaker 7: What influence Musk might have with electric vehicles, I think
Speaker 7: is a third order impact beyond that larger question of
Speaker 7: the stress that our economy is going to feel under
Speaker 7: your Trump administration.
Speaker 9: Well, Congressmen, before we can get there to the incoming administration,
Speaker 9: there is this session of Congress to finish out in
Speaker 9: this spending fight that needs to be fought. Obviously, we're
Speaker 9: facing a deadline here of December twentieth. In what form
Speaker 9: do you expect ultimately a shut down a version will
Speaker 9: take And where does one hundred billion dollars in request
Speaker 9: of disaster relief fit into the picture?
Speaker 4: Well, I think we all hurt.
Speaker 7: Johnson say this week that he wanted to do a
Speaker 7: short term continuing resolution that would put the disaster package
Speaker 7: in there. What we've all struggled with through this whole
Speaker 7: session is that there's a war within the Republican Party
Speaker 7: between itself. I think it's Freedom Caucus would like to
Speaker 7: oppose any spending package. The more sort of main street
Speaker 7: ends of the Republican Party would like to negotiate this
Speaker 7: in good faith. If I had to guess right now,
Speaker 7: I'd say that they punt until the next Congress through
Speaker 7: a CR But we'll see. I think they're having a
Speaker 7: lot of fights within themselves on how.
Speaker 4: To get through there.
Speaker 7: And you know, we've basically run this entire year on
Speaker 7: a continuing resolution, arguably the last two years on a
Speaker 7: continuing resolution as a result of the fact that the
Speaker 7: Republican Party, particularly in the House, has struggled with governance,
Speaker 7: and so we just keep limping along and kicking through
Speaker 7: last year's priorities of the year before't priorities.
Speaker 4: I expect that.
Speaker 7: Will continue through this turn, but I would love to
Speaker 7: be pleasantly surprised.
Speaker 9: All right, Congressman, we appreciate your time. That it is
Speaker 9: the Democrat from Illinois shancast In joining us live from
Speaker 9: Capitol Hill.
Speaker 2: You're listening to the Bloomberg Balance of Power podcast kens
Speaker 2: just Live weekdays at noon Eastern on Applecarplay and then
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Speaker 2: Just Say Alexa Play Bloomberg eleven thirty.
Speaker 9: We Mark on this Tuesday, one thousand days of war
Speaker 9: between Russia and Ukraine, and this deep into this conflict,
Speaker 9: things do seem to be escalating. After the US granted
Speaker 9: Ukraine permission to use US made weapons for longer range
Speaker 9: strikes into Russia, and Ukraine took advantage of that newly
Speaker 9: granted privilege by striking a military base in Russian territory,
Speaker 9: leading Moscow to respond with threat regarding nuclear weapons, putin
Speaker 9: signing a decree allowing Russia to fire nuclear weapons in
Speaker 9: response to conventional attacks, including things like drone strikes. So
Speaker 9: at a time in which this feels like it's getting
Speaker 9: a whole lot hotter, we heard from the Ukrainian President
Speaker 9: Voladimir Zalynski about a path toward this being over.
Speaker 10: We must push Russia toward just every blow and every
Speaker 10: thread from Russia must be met with it for sanctions,
Speaker 10: but Sultan days, it has been crucial to radically reduce
Speaker 10: Russia's ability to fund its war through oil sales.
Speaker 3: Speaking to the European Parliament earlier today, quite the reaction
Speaker 3: from Sergei Lavrov, the Russian Foreign Minister, reacting to the
Speaker 3: use of those attacks missiles that Kaylee just mentioned quote,
Speaker 3: we will be taking this as a qualitatively new phase
Speaker 3: of the Western war against Russia, and we will act
Speaker 3: accordingly unquote. That's where we begin with Bloomberg's David Goura,
Speaker 3: who's still in Riotation Arrow where they are just now
Speaker 3: wrapping the G twenty summit, Joe Biden's last G twenty David,
Speaker 3: this is the topic on the ground there today. What
Speaker 3: are you hearing.
Speaker 11: President Biden making his way to the airport. He has
Speaker 11: done with this summit, but those words from Sergei Lavrov
Speaker 11: had a seismic effect on this summit while it was
Speaker 11: wrapping up today. Everyone was listening. Indeed, it move markets
Speaker 11: when he spoke about the changes to the Russian nuclear doctrine,
Speaker 11: in the fact that he saw the move as escalatory.
Speaker 11: You know, it's interesting the White House didn't immediately confirm this.
Speaker 11: I watched an interview yesterday that Jake Sullivan, the National
Speaker 11: Security Advisor, did with the PBS News Hour. He wouldn't
Speaker 11: confirm that the US was giving those missiles to Ukraine
Speaker 11: and allowing them to use them explicitly. Of course, we
Speaker 11: did see that overnight. We had confirmation from Russia, but
Speaker 11: not from Ukraine, and I should say. Vandrier Zelenski wanted
Speaker 11: to be here for this event, wanted to make his
Speaker 11: case for continued multilateral support of his effort to fight
Speaker 11: off Russia in his home country, and that request for
Speaker 11: infredation was rebuffed by President Lula here of Brazil. But
Speaker 11: this has come up over and over again on meetings
Speaker 11: on the sidelines and really shaped the last day of
Speaker 11: this session. There was a pivotal bilateral meeting this morning
Speaker 11: between President She of China and Olaf Schultz, the Chancellor
Speaker 11: of Germany. As we've been talking about, Chancellor Olaf Schultz
Speaker 11: had a conversation with Vladimir Putin a few days ago,
Speaker 11: and he was briefing world leaders, including President She about this.
Speaker 4: But there is this variable here.
Speaker 11: That looms large, guys, sort of what President Biden is
Speaker 11: able to do in terms of setting policy allowing for
Speaker 11: the use of these ammunitions and weapons, and what's going
Speaker 11: to happen in just a couple of months time when
Speaker 11: he leaves the White House and President Trump comes back.
Speaker 9: All right, Bloomberg correspondent David Geras still live in Riodasian
Speaker 9: era for us, Thank you so much. Now, as we
Speaker 9: consider the words of Sergei Lavrov today. He also said
Speaker 9: that we are strongly in favor of doing everything not
Speaker 9: to allow nuclear.
Speaker 4: War to happen.
Speaker 9: At the same time that this nuclear oriented a decree
Speaker 9: was signed by the Russian President. So I wonder to
Speaker 9: what extent we take those words at face value.
Speaker 3: I don't know how you square those two. There are
Speaker 3: questions about whether this blo US might be an attempt
Speaker 3: to take advantage of this lame duck session that we're
Speaker 3: in right now in advance of Donald Trump taking office,
Speaker 3: But this is something that we can only wonder right now.
Speaker 3: Remarkable though, to think that President Zelenski waited only hours
Speaker 3: after Joe Biden gave him permission to use those missiles.
Speaker 9: Yeah, pretty incredibly quick in terms of action here, though.
Speaker 9: They had been waiting for this kind of move from
Speaker 9: the US administration for this permission to be granted for
Speaker 9: some time. So we wanted to get into all of
Speaker 9: this with Kelly Grico. She is a senior fellow at
Speaker 9: the Stimson Center and expert in the weapons of war.
Speaker 9: Kelly would love to hear from you on just what
Speaker 9: you make of the escalatory nature it seems we've seen
Speaker 9: from both sides in just the last twenty four hours.
Speaker 9: How does Ukraine respond to the threat of Russia saying
Speaker 9: if you strike us again, we could use a nuclear weapon.
Speaker 9: Does that mean this might be the first and only
Speaker 9: time the Ukraine used these attackers in this way.
Speaker 12: Yes, well, thank you for having me. I will say
Speaker 12: that I'm not surprised by the Russian response. They had
Speaker 12: sign earlier that this could actually be the response. Over
Speaker 12: the summer, they had discussed that they were revising their
Speaker 12: nuclear doctrine to lower the nuclear threshold for conventional attacks,
Speaker 12: and so what we saw today was essentially a confirmation
Speaker 12: of that, signing the order that it is now official policy.
Speaker 12: I think, you know, it's interesting here we're playing a
Speaker 12: very dangerous game of chicken on both sides, essentially to
Speaker 12: see which side's going to blink first and stand down.
Speaker 12: Whether you know, my intendency is to think that the
Speaker 12: Ukrainians will be likely to try to call Putin's bluff.
Speaker 12: I think the question will be whether the Biden administration
Speaker 12: and also European allies are prepared to call his bluff
Speaker 12: in this way, or we'll see it as perhaps this
Speaker 12: is a step too far and it's worth backing down.
Speaker 3: Well, I'm struck by the response, which was a non
Speaker 3: response by the US. It's like Joshua and wargames. The
Speaker 3: only way to win is not to play. Kelly was
Speaker 3: at the right angle for the US government today.
Speaker 12: Yes, I think it was because it does allow for
Speaker 12: especially if we side to back down and that maybe
Speaker 12: this is going to be a one off. I think
Speaker 12: it allows us to do it in a way that
Speaker 12: it creates some ambiguity, so we don't have as much
Speaker 12: of a reputational cost if we decide to revise this policy.
Speaker 12: So if we've never confirmed that we authorize this, that
Speaker 12: these were actually you know, the attackers that we're used,
Speaker 12: and it doesn't happen again, it's sort of an easier way,
Speaker 12: I think, to manage a reversal of the policy without
Speaker 12: sort of you know, taking a reputational hit. So I
Speaker 12: think that was very smart.
Speaker 9: Well, and when we consider the US's decision making here
Speaker 9: to allow Ukraine to use these weapons at longer range
Speaker 9: and strike Russian territory, that's not necessarily being granted by
Speaker 9: all allies of Ukraine alike Kelly, Germany for example, and
Speaker 9: the Chancellor ll Off Sholtz still incredibly reluctant to allow
Speaker 9: Ukraine use of their Torus long range missile systems. There's
Speaker 9: been a lot of talk about that in the last
Speaker 9: few days. What would providing those weapons to Ukraine mean
Speaker 9: differently or is this kind of exactly the same scenario
Speaker 9: wise is the US decision on attacks?
Speaker 12: You know, it's exactly the same, and you know the
Speaker 12: Germans have been much more cautious than what they provided.
Speaker 12: But I think it's worth noting that even our French
Speaker 12: and British allies that have been i would say more
Speaker 12: forward leaning and providing longer range systems to the Ukrainians
Speaker 12: have still not provided permission to use those weapons on
Speaker 12: Russian territory. And I think Putin's nuclear threats will certainly
Speaker 12: probably cause them to pause that and rather than follow
Speaker 12: suit with the United States in that regard. But I
Speaker 12: think the really important thing here to mention is that
Speaker 12: none of these long range systems, because they're only available
Speaker 12: in very small numbers, are likely to actually transform Ukraine's
Speaker 12: You know what Ukraine accomplish in the war right now,
Speaker 12: It's in a very tough position, largely because it lacks
Speaker 12: sufficient manpower to hold the front, and it's being gradually
Speaker 12: pushed back by the Russians, and these long range strikes
Speaker 12: are not going to change that reality. And so you know,
Speaker 12: you do have to wonder is it worth the escalation
Speaker 12: risks here given what it can actually accomplish militarily.
Speaker 3: Well, I guess i'd ask you that what kind of
Speaker 3: damage could President Zelenski do? What kind of ground could
Speaker 3: Ukraine gain with the use of these weapons in time
Speaker 3: to strengthen its hand at the negotiating table, realizing that's
Speaker 3: a pretty short window it looks like for when Donald
Speaker 3: Trump comes into office.
Speaker 12: Yeah, I actually don't think this is about Ukraine gaining
Speaker 12: more ground. I think it's actually an attempt to try
Speaker 12: to save ground that Ukraine has, and particularly the Curse
Speaker 12: region where Ukraine went in in August and captured this
Speaker 12: Russian territory and this surprise operation and the Russians are
Speaker 12: gearing up to it seems take back that territory. There's
Speaker 12: about fifty thousand troops in the Curs area, including North Koreans,
Speaker 12: and so I think part of the decision here was
Speaker 12: to try to allow the Ukrainians to be able to
Speaker 12: conduct these long range strikes in the Curs area only
Speaker 12: so that they could hit supply depots, ammunition storage, any
Speaker 12: concentrations of troops to try to disrupt those Russian operations,
Speaker 12: and hopefully if Ukraine and can hold on to that
Speaker 12: Cursk territory, they could use it as a bargaining chip
Speaker 12: at the negotiating table.
Speaker 9: Kelly, I want to ask you about another development today,
Speaker 9: the IAEA saying that Iran has agreed to stop producing
Speaker 9: uranium enriched to the level at which it's required for
Speaker 9: nuclear weapons, that's sixty percent production level. They say they've
Speaker 9: implemented measures aimed at stopping the increase of iron stockpile.
Speaker 9: But I wonder just the status of the stockpile as
Speaker 9: it is, even if they're taking these steps, Kelly, how
Speaker 9: much does iron already have at its disposal if it
Speaker 9: wants to move forward with weapons.
Speaker 12: Yes, I mean most estimates that I've heard from you know,
Speaker 12: nuclear experts that blotch Ran closely, is that they're very close,
Speaker 12: probably you know, months away, if they wanted to from
Speaker 12: being able to have sufficient amounts and be able to
Speaker 12: create a nuclear weapon. I think what it's a really
Speaker 12: interesting signal that they're sending kind of extending in olive
Speaker 12: branch in some ways. And you know, it's interesting this
Speaker 12: hap comes after the reporting we heard about Mosque meeting
Speaker 12: with the Iranians. So it's an important signal and I'd
Speaker 12: be curious to see how the Trump future Trump administration reacts.
Speaker 3: Well, considering the potential impact of the future Trump administration
Speaker 3: and seeing the ceasefire struck in Lebanon that was framed
Speaker 3: as some sort of a gift for the incoming president.
Speaker 3: Do you see all of the hot wars Ukraine? You
Speaker 3: can add what's happening in Israel to the list here
Speaker 3: potentially resolving or at least advancing to the next phase
Speaker 3: under a new White House.
Speaker 12: Yeah, I mean it is really something to watch, isn't
Speaker 12: it that we've been We've had these wars, certainly for
Speaker 12: the last year to very active wars, one in Europe,
Speaker 12: one in the Middle East. The Ukraine war course has
Speaker 12: gone on longer, and right as it's whinding you know,
Speaker 12: Biden's administration is winding down, a lot of these parties
Speaker 12: are now thinking that they're better off negotiating knowing that
Speaker 12: the Trump administration is coming. And so I think, what
Speaker 12: are something here that we should be thinking about as
Speaker 12: the United States, about whether we have actually inadvertently perhaps
Speaker 12: enabled these wars to drag on because we haven't really
Speaker 12: provided any restraints or not very many restraints on our
Speaker 12: allies in these wars, and whether that really served our
Speaker 12: interests and served you know, either Israeli or Ukrainian interests.
Speaker 12: And so it is quite remarkable that we might actually
Speaker 12: see at least some kind of freezing of these conflicts
Speaker 12: pretty soon into a Trump administration.
Speaker 3: Some big questions to answer, Kelly. It's great to have
Speaker 3: you back. Kelly Grico, Senior Fellow at the Stimson Center.
Speaker 3: Thank you so much for the insights and analysis as
Speaker 3: we track what's happening in Ukraine on this thousandth day
Speaker 3: of its war with Russia. I'm Joe Matthew alongside Kaylee
Speaker 3: Lines in Washington. Thanks for being with us on Balance
Speaker 3: of Power as we transition to the economy next, an
Speaker 3: important conversation with Joe Lavorgnia live from New York here
Speaker 3: on Bloomberg TV and radio.
Speaker 2: You're listening to the Bloomberg Balance of Power podcast. Catch
Speaker 2: us live weekdays at noon Eastern on Apocarplay and then
Speaker 2: roud Otto with the Bloomberg Business app. Listen on demand
Speaker 2: wherever you get your podcasts or watch us live on YouTube.
Speaker 9: I'm just realizing this sast Tuesday. That means we're officially
Speaker 9: now two weeks since election day. Two weeks that for
Speaker 9: Joe Matthew myself felt more like two months.
Speaker 3: Possibly they know two years that goes for a nation.
Speaker 9: Yeah, because a lot has happened since we learned that
Speaker 9: Donald Trump would become the president elect, as he has
Speaker 9: wasted no time filling out what his second administration will
Speaker 9: look like. But he is spending time on one role
Speaker 9: in particular, maybe more time than he first intended on
Speaker 9: Treasury Secretary, after a lot of infighting has played out
Speaker 9: quite publicly.
Speaker 3: Yeah, this has been quite remarkable to witness. We're still
Speaker 3: not done. We don't know who will be the Treasury secretary,
Speaker 3: but we do know who will not, and that's because
Speaker 3: Howard Lutnik, who was said to be on the short
Speaker 3: list of course, co chair of the transition, has been
Speaker 3: named Commerce Secretary. That's the most recent one that we
Speaker 3: got here, according to reports. And Nancy Cook has been
Speaker 3: driving a lot of our coverage here on the transition
Speaker 3: for US from Bloomberg here in Washington, our senior national
Speaker 3: correspondent for politics with us at the table. Nancy gets
Speaker 3: great to see you. We've got to be getting close
Speaker 3: to the big one here, right for Bloomberg at least
Speaker 3: it's the big one. Usually you see Treasury come first
Speaker 3: because that's the less controversial pick. Why is it so
Speaker 3: hard this time?
Speaker 13: There has just been a tremendous amount of infighting over
Speaker 13: the Treasury pick that.
Speaker 4: Is really delayed.
Speaker 13: And so a week or so ago, Scott Besson, who
Speaker 13: I know you have had on the show before, was
Speaker 13: relea seen as the front runner than Howard Lutnik decided,
Speaker 13: you know, he is running the personnel side of the transition.
Speaker 13: He decided he wanted the job for himself and told
Speaker 13: President Elect Trump that. And basically there's been sort of
Speaker 13: a lot of infighting within the transition team over who's
Speaker 13: going to get that post. Trump has grown tired of
Speaker 13: the leaks, tired of sort of the back and forth
Speaker 13: on this, and is now considering a whole new roster
Speaker 13: of new candidates who have not been involved in the infighting.
Speaker 13: So our reporting shows that he is supposed to meet
Speaker 13: with Kevin Walsh, who was a Fed governor, tomorrow. He's
Speaker 13: also supposed to meet with Mark Rowen of Apollo. Senator
Speaker 13: Bill Haggerty, who has been another guest of the show
Speaker 13: as in the mix and so really he's the pool
Speaker 13: has expanded as the infighting sort of dragged on for
Speaker 13: the week.
Speaker 9: Well, and it did make me wonder when Bloomberg has
Speaker 9: reported this as well, though Donald Trump of course hasn't
Speaker 9: yet made it official that it could be Howard Lutnik
Speaker 9: for Commerce. If there's been so much jocking between the two,
Speaker 9: if they're both to serve in the administration together working
Speaker 9: toward economic goals, that that might create some strife internally
Speaker 9: if they actually have to work together in that capacity,
Speaker 9: And I wonder if that actually means that if Lutnik
Speaker 9: gets a formal cabinet role, that Bessett can't get one.
Speaker 13: Well, we reported yesterday that they had offered Scott bessen
Speaker 13: they'd spoken to him about the both the Treasury position,
Speaker 13: but also there was talks about putting him in the
Speaker 13: White House at the National Economic Council, and so you know,
Speaker 13: they have floated different jobs for him. I think it's
Speaker 13: unlikely that the two of them both end up in
Speaker 13: the administration at this point, but again, the Trump team
Speaker 13: has not officially announced Latin it yet, and so I
Speaker 13: think that, you know, we won't be totally sure until
Speaker 13: we see that come that announcement come from them directly.
Speaker 3: National Economic Council or Council of Economic Advisors, the two agencies,
Speaker 3: if you will, or the two groups inside the White
Speaker 3: House advising the President's been suggested, might actually have more influence,
Speaker 3: play a greater role in the administration because they're in
Speaker 3: the White House with Donald Trump, which is exactly how
Speaker 3: he operates. Does that make.
Speaker 13: Sense, Yeah, I mean, well, Treasury secretary is its own
Speaker 13: cabinet position. You know, you have a plane, you have
Speaker 13: a staff. You know, you're seeing a sort of more
Speaker 13: of a principle and a peer, I would say to
Speaker 13: the president. But the National Economic Council, you have to remember,
Speaker 13: in Trump's first term was led by Larry Kudlow, who
Speaker 13: was one of Trump's favorite people. You know, he was
Speaker 13: in the running for Treasury Secretary as well, but sort
Speaker 13: of took himself out of it because he's a Fox
Speaker 13: News commentator and I think didn't want to disrupt his
Speaker 13: life to that example, But that role when Larry Kudlow
Speaker 13: occupied it, and even Gary Cohen before that, you know,
Speaker 13: was a real powerhouse. Because your office is in the
Speaker 13: White House, you're sort of in all those meetings. My
Speaker 13: question really for the economic policy making this Trump term
Speaker 13: is that it was so riddled with infighting last time,
Speaker 13: particularly in the trade space, over what to do of tariffs,
Speaker 13: what to do on the policy towards China. You had
Speaker 13: some people who wanted, you know, tons of tariffs, some
Speaker 13: people who wanted more free trade. So I will be
Speaker 13: looking once Trump announced his economic team sort of where
Speaker 13: the fissiers are, particularly on how these different players are
Speaker 13: going to view trade well.
Speaker 9: And that makes the role of USTR very important. Right
Speaker 9: one of these who it doesn't get the Treasury position
Speaker 9: potentially get that one instead.
Speaker 13: Us TR is really an open question, and I think
Speaker 13: where Robert Leithheiser ends up as an open question. You know,
Speaker 13: our reporting shows that he does not want to go
Speaker 13: to USTR again, even though that's a role that you
Speaker 13: know he did quite well and effectively in the first
Speaker 13: Trump term. And so I don't think he's going to
Speaker 13: get Treasury secretary. He doesn't want USTR again, Where does
Speaker 13: he land because he has been such a Trump ally.
Speaker 13: Same thing with Linda McMahon, she is the other coachair
Speaker 13: of the transition. We know Trump has interviewed her for commerce.
Speaker 13: If Lutnick actually ends up getting the official nod for commerce,
Speaker 13: where does Linda McMahon go. So there's a lot of
Speaker 13: real loyalists in the Trump or, but who may end
Speaker 13: up without jobs?
Speaker 9: Fascinating, Well, we know Nancy Cook will be covering all
Speaker 9: of it for us as the piece is move about
Speaker 9: the board here Bloomberg National Politics reporter Nancy Cook, and
Speaker 9: we want to talk more about this kind of economic
Speaker 9: team and frankly, what kind of policy it is they're
Speaker 9: really going to be pursuing once they are assembled and
Speaker 9: turned back to Joe Lavornia, He of course served in
Speaker 9: the first Trump why House, a Special Assistant to the
Speaker 9: President and chief Economist at the National Economic Council, and
Speaker 9: is now chief economist with SMB Nico Securities. He's joining
Speaker 9: us from New York. Joe would love to just get
Speaker 9: your take on how you're watching all of this play out.
Speaker 9: As Frankly, some of the names that Nancy just told
Speaker 9: us seemed to be in contention here, like Kevin worsh
Speaker 9: might actually have some conflict with Donald Trump when it
Speaker 9: comes to the approach around policies like tariffs, for example,
Speaker 9: What do you think?
Speaker 14: So I thought Nancy did a very good job reporting,
Speaker 14: But to me, I don't see it as infighting at all.
Speaker 8: I actually think it's healthy debate.
Speaker 14: And the press, I think, sometimes treats anything that mister
Speaker 14: Trump or President Electrump says as catnip, and I think
Speaker 14: you've got a lot of healthy debates, and so I
Speaker 14: think the infighting thing is very much overhyped. I could
Speaker 14: tell you that when I was there, and this was
Speaker 14: during the pandemic, there wasn't chaos, and that.
Speaker 8: Was typically the adjective people use.
Speaker 14: So I think we have to be a little bit
Speaker 14: more careful in terms of I think how we describe things,
Speaker 14: but in terms of the people, I mean, the president
Speaker 14: certainly has a great list of people who could take
Speaker 14: the role. I think what you're referring to as it
Speaker 14: relates to Kevin Worsh as a paper position he had
Speaker 14: back in twenty eleven, the world has totally changed since then.
Speaker 14: So whether it's Kevin Worsh or Scott Bessen and complimentary roles,
Speaker 14: I think the nation would be well served. But I
Speaker 14: think the point is that the President elect is making
Speaker 14: a very thorough, thoughtful decision on who we want, and
Speaker 14: we have to applaud the fact that he's moving with
Speaker 14: patients and thinking about it.
Speaker 3: Joe, thank you for that, considering all the motion here
Speaker 3: and the commotion and the reporting that you may or
Speaker 3: may not think is totally accurate, at least describing the
Speaker 3: mood at mar A Lago. You've been there. You know
Speaker 3: what this is like. You were chief economist, National Economic Council.
Speaker 3: Are you loving sitting back here watching what's going on
Speaker 3: from your perch or are you actually in conversation with
Speaker 3: the transition team about taking on another role of this
Speaker 3: new White House.
Speaker 13: Now.
Speaker 14: I'm lucky that I get to be an outside observer
Speaker 14: and have some insight into Washington, and most importantly, the
Speaker 14: markets are moving and it's making my day job more
Speaker 14: fun and interesting.
Speaker 8: It's great already, but we're making it great again. Poor
Speaker 8: pun but you know what I mean.
Speaker 14: But no, it's it's pretty interesting in terms of what happens.
Speaker 14: And I do think you know the people that the
Speaker 14: President is considering for Treasury, I think what's important is
Speaker 14: they're not folks that I think would be market negative
Speaker 14: by any means, and the President needs to put someone
Speaker 14: there who can articulate as policies, be a spokesperson for
Speaker 14: the markets, and do it in a way that inspires confidence.
Speaker 14: And I think what you're seeing now with the equities
Speaker 14: close to their all time highs and the market and
Speaker 14: treasury market, you know, basically not selling off further, I
Speaker 14: think right now is a vote of confidence that over
Speaker 14: the president picks will be someone that investors are largely
Speaker 14: comfortable with.
Speaker 9: Well as we consider the markets here and the public
Speaker 9: companies that trade on them, Joe, we did get some
Speaker 9: news from the CFO of Walmart, who told CNBC today
Speaker 9: that if Donald Trump implements the tariffs as expected, Walmart
Speaker 9: will likely have to raise some prices. I know we've
Speaker 9: discussed this with you at length, but this points to
Speaker 9: the inflationary concerns many have, Joe, and I wonder how
Speaker 9: many price increases you would expect to see.
Speaker 14: So I think what's very important is, again, as I
Speaker 14: said this, like, maybe there's five pillars of trumpnomics. One
Speaker 14: of them certainly is the tariffs, but also part of
Speaker 14: that is lower energy costs, and the energy share of
Speaker 14: the economy is larger than the imported goods share of
Speaker 14: the economy, and energy prices are down, has a more
Speaker 14: multiplicative effect, and that impacts other goods and prices, and
Speaker 14: lower costs actually can reduce the inflation rate. A tariff
Speaker 14: theoretically would be a one off increase in the price level,
Speaker 14: so it's not inflationary. Moreover, what we saw from basically
Speaker 14: the twenty seventeen to twenty twenty period is that producers largely,
Speaker 14: if not fully, absorbed that pricing. So to sound a
Speaker 14: bit like an economist, that depends on implementation.
Speaker 8: But I think people who.
Speaker 14: Are fixated on the tariffs as being inflationary and hurting,
Speaker 14: I think are missing the bigger picture and what President
Speaker 14: elect is trying to do, because it also involves a deregulation,
Speaker 14: which is growth enhancing, lower tax rates on the corporate sector,
Speaker 14: and the intention is to increase productive capacity and supply,
Speaker 14: which lifts productivity and actually with lower inflation. So I
Speaker 14: don't like when people just fixate on one little narrow
Speaker 14: piece and don't look at the possible effects, the second
Speaker 14: and third order effects that tariffs may have that actually
Speaker 14: are not destabilizing or inflationary really in any appreciable way.
Speaker 3: I'd like to ask you about Donald Trump's pick for
Speaker 3: energy Secretary Chris Wright said to be an innovator when
Speaker 3: it comes to fracking. This is drill, baby, drill, right,
Speaker 3: assuming he's confirmed, Joe, what will it mean for oil
Speaker 3: prices in say, the first year of Donald Trump's administration,
Speaker 3: because the President elect has made some big promises lower
Speaker 3: energy prices by half.
Speaker 14: Yeah, I mean, the thing is we're going to get
Speaker 14: lower energy costs at I don't know where prices go.
Speaker 14: A lot will depend in part on the global economy
Speaker 14: and what the President decides to do with Iran in sanctions,
Speaker 14: so it's not just a US phenomenon.
Speaker 8: But I do think there is going to be a very.
Speaker 14: Concerted effort to get energy production higher, to get gasoline
Speaker 14: prices back. I believe they average only around two fifty
Speaker 14: a gallon under President Trump's first term. So if you
Speaker 14: can get prices down at the pump, that's savings that
Speaker 14: immediately go into middle and lower class pocketbooks, and people
Speaker 14: appreciate because again they could spend money in other goods
Speaker 14: and services.
Speaker 8: So energy costs are likely to fall where they go.
Speaker 14: I'm not sure at this point, but yes, you're correct.
Speaker 14: The drill maybe drill mantra will be a day one initiative,
Speaker 14: and you'll see President Trump, through executive order increase leasing
Speaker 14: and use of federal lands, exploration of offshore drilling. All
Speaker 14: those things will come back into the fold. Well.
Speaker 9: We also expect that the President elect, pretty soon after
Speaker 9: taking office, could use his executive order powers to address
Speaker 9: the border and migration. He confirmed yesterday reports that he'd
Speaker 9: looked to use the military to enact the mass deportations
Speaker 9: or get those underway that he said he would on
Speaker 9: the campaign trail. How quickly do you think that would
Speaker 9: start to resonate in economic data?
Speaker 14: J I don't think that immigration actually has had as
Speaker 14: big an effect on the economy as people think. It's
Speaker 14: not as if the people who are coming over illegally
Speaker 14: are answering a government questionnaire as to whether they're working.
Speaker 14: And I'd argue that the president's potential policies already have
Speaker 14: worked to slow foot traffic, and of course border security
Speaker 14: implementation will be much stricter, so you'll see the crossings
Speaker 14: come down. What happens beyond that, I can't say, but
Speaker 14: I don't think this notion somehow we're going to get
Speaker 14: this leftward shift and the labor supply curve and of
Speaker 14: all this inflation, I think is very misleading. You saw
Speaker 14: under Trump's first term, you saw immigration and border crossings
Speaker 14: fall to a deminimus level, and yet you had very
Speaker 14: little inflation, and you still had very good real wage growth.
Speaker 14: So I don't think this is going to be a
Speaker 14: factor impacting the larger economy of the labor market in particular.
Speaker 3: Joela Vorgna, SMBC NICO Securities America, a veteran of the
Speaker 3: first Trump White House. Joe, it's good to see you.
Speaker 3: Thank you for the insights as always, fascinating conversation, Kaylee,
Speaker 3: as we wait for the next big one, of course
Speaker 3: commerce to be official, but also treasury. This is something
Speaker 3: we might be waiting the rest of the week for.
Speaker 3: It sounds like. Thanks for listening to the Balance of
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