WEBVTT - Dem Midterm Sweep 0:00:02.529 --> 0:00:04.210 Bloomberg Audio Studios. 0:00:04.690 --> 0:00:05.370 Podcasts. 0:00:05.690 --> 0:00:07.050 Radio. News. 0:00:12.530 --> 0:00:16.670 This is the Bloomberg Surveillance Podcast. Catch us live weekdays 0:00:16.730 --> 0:00:20.210 at 7 a.m. Eastern on Apple CarPlay or Android Auto 0:00:20.290 --> 0:00:23.870 with the Bloomberg Business App. Listen on demand wherever you 0:00:23.910 --> 0:00:26.970 get your podcasts or watch us live on YouTube. 0:00:27.490 --> 0:00:30.729 Patrick McHenry has been doing this out of his youth. 0:00:30.910 --> 0:00:34.019 I give him immense respect. credit for starting young in 0:00:34.640 --> 0:00:38.839 the national political game. I see forever you're going to 0:00:38.860 --> 0:00:42.159 be Congressman McHenry. Get over it. Of course, head of 0:00:42.200 --> 0:00:48.070 international economics with Bloomberg News. Patrick McHenry, I see Pat 0:00:48.110 --> 0:00:52.519 Harrigan fighting for his life in the 10th District of 0:00:52.620 --> 0:00:57.630 North Carolina against Ashley Bell. I mean, right there, it 0:00:58.870 --> 0:01:04.030 is a shock alone. Describe how close that vote is 0:01:04.470 --> 0:01:07.350 in Hickory in the 10th and North Carolina District. 0:01:08.390 --> 0:01:09.030 Hundreds of votes. 0:01:10.250 --> 0:01:12.650 And it looks like Pat Harrigan's one of the rare 0:01:12.709 --> 0:01:16.830 Republican survivors in the congressional delegation in North Carolina. What 0:01:16.850 --> 0:01:22.120 we do know is it confirmed six Republicans lost their 0:01:22.160 --> 0:01:26.400 congressional seats in North Carolina, including the Rules Committee chairman, 0:01:26.440 --> 0:01:31.400 my friend and classmate, Virginia Fox, who is a tenacious 0:01:31.440 --> 0:01:35.110 fighter on the campaign trail, and the chair of the 0:01:35.360 --> 0:01:41.770 Congressional Committee, my friend, dear friend since college, Richard Hudson. 0:01:42.590 --> 0:01:44.869 He lost that Pinehurst-based seat. 0:01:45.330 --> 0:01:47.570 He was the head of the House Campaign Committee for 0:01:47.930 --> 0:01:51.620 Republicans in Devastating night for my party in North Carolina, 0:01:51.640 --> 0:01:56.830 the likes of which we've not seen since, frankly, 1996. 0:01:56.850 --> 0:02:02.700 when Jim Hunt, Governor Jim Hunt, the legendary Democrat, was. 0:02:02.620 --> 0:02:03.080 On the ballot. 0:02:03.620 --> 0:02:06.440 You know, North Carolina didn't become a Republican state until 2010. 0:02:06.440 --> 0:02:10.430 This was a truly devastating night. 0:02:11.280 --> 0:02:13.090 Patrick McHenry, I look at this and I'm going to 0:02:13.110 --> 0:02:16.050 take it back. Somebody actually emailed me yesterday about Barbara B. 0:02:16.110 --> 0:02:18.830 Conable of Western New York, who was one of the 0:02:18.870 --> 0:02:22.820 heroes of of moving the Republican Party forward after Watergate. 0:02:23.300 --> 0:02:28.540 Patrick McHenry, how do Republicans in North Carolina, and indeed 0:02:28.580 --> 0:02:32.850 across a traditional Republican landscape, how do they pick up 0:02:32.870 --> 0:02:35.550 the pieces? Do they await 2027, or can they start 0:02:35.610 --> 0:02:37.049 this Wednesday morning? 0:02:39.400 --> 0:02:40.860 They have to start this Wednesday. 0:02:41.200 --> 0:02:45.010 You have to register the message that the voters sent. 0:02:46.230 --> 0:02:49.430 And they sent a very clear message in North Carolina. 0:02:49.490 --> 0:02:53.269 Roy Cooper has won a nearly 18 to 19 point victory. 0:02:56.490 --> 0:03:00.709 His last polling had him up 10 points. He was 0:03:01.389 --> 0:03:04.350 elected five times statewide, never by a margin like this. 0:03:04.940 --> 0:03:07.100 But to the U.S. Senate, he brings in a. 0:03:09.060 --> 0:03:13.280 Democratic-controlled the statehouse, something he couldn't do as governor. You 0:03:13.300 --> 0:03:15.899 have to acknowledge what the voters have sent a message on. 0:03:16.040 --> 0:03:18.840 And it's not simply President Trump. It's a question of 0:03:18.880 --> 0:03:23.040 independence and actually delivering on your word. and the principles 0:03:23.080 --> 0:03:27.670 you campaigned on. And you've got to go back to 0:03:27.730 --> 0:03:31.330 them and understand what they want and make sure you 0:03:31.350 --> 0:03:32.070 deliver for them. 0:03:32.310 --> 0:03:35.520 Across America, we welcome all of you commercial-free across the 0:03:35.640 --> 0:03:40.180 arc of Bloomberg Surveillance. This morning, a special post-election coverage 0:03:40.220 --> 0:03:43.160 with many, as John Tucker said, many of the contests, 0:03:43.200 --> 0:03:47.530 including North Carolina 10, undecided right now. Tom Keene and 0:03:47.560 --> 0:03:51.090 Paul Sweeney, a great set of conversations as we look 0:03:51.110 --> 0:03:54.650 to Texas, Paul, now North Carolina and the nation with 0:03:54.690 --> 0:03:55.610 Patrick McHenry. 0:03:55.870 --> 0:04:00.930 Absolutely, Tom. Patrick, what is President Trump or how does 0:04:00.950 --> 0:04:04.330 the Republican Party work with its president over the next 0:04:04.370 --> 0:04:07.630 two years, given what just happened? in the last 12 0:04:07.630 --> 0:04:10.810 hours here. How does this party work with its president? 0:04:11.650 --> 0:04:16.870 Well, long term, this president still has mastery over the 0:04:16.930 --> 0:04:21.690 Republican Party, not just the mechanics of it, but even 0:04:21.750 --> 0:04:24.920 at this stage where the president is not popular with 0:04:24.950 --> 0:04:28.700 the voting electorate. You heard that like a siren sound 0:04:29.060 --> 0:04:30.000 like 1994, 1974. That is the magnitude of what we 0:04:30.100 --> 0:04:36.460 saw last night. But he still, at this stage of 0:04:36.480 --> 0:04:41.350 the game, is one of the most popular presidents Republicans 0:04:41.370 --> 0:04:44.690 have ever had within their own party. That gives him 0:04:44.710 --> 0:04:47.690 enormous stick to say, you cannot run away from me, 0:04:48.110 --> 0:04:52.089 even though we had a very, very bad night. The 0:04:52.190 --> 0:04:54.230 challenge is going to be in the short term, because 0:04:54.250 --> 0:04:56.810 we've got to go back. Congress has to go back 0:04:56.930 --> 0:05:01.510 to session next week for the rest of the lame duck. 0:05:02.580 --> 0:05:05.060 You've got a set of issues you have to wrestle 0:05:05.100 --> 0:05:10.310 with there. And you're going to see this in the Senate. 0:05:10.450 --> 0:05:15.089 We knew this with the likes of Senator Tillis leaving 0:05:15.150 --> 0:05:18.849 the chamber. They're going to make their voices heard. 0:05:19.870 --> 0:05:21.330 But now we have this in the U.S. 0:05:21.360 --> 0:05:27.530 House, where you're going to see a group– we're sitting 0:05:27.570 --> 0:05:31.469 now at over 240 Democrats in the U.S. 0:05:31.529 --> 0:05:31.849 House. 0:05:32.850 --> 0:05:36.099 This is a massive majority that the Democrats will have. 0:05:37.560 --> 0:05:38.980 A lot of people are going to lose their jobs 0:05:39.040 --> 0:05:41.640 and they're going to be out of their offices within 0:05:41.779 --> 0:05:45.260 days of returning back to Washington. The mood is going 0:05:45.279 --> 0:05:49.020 to be insanely sour for Republicans. 0:05:48.430 --> 0:05:49.330 When they go back. 0:05:50.230 --> 0:05:52.390 That's going to be the first speed hump, which is 0:05:52.470 --> 0:05:55.900 this first coming to grips that You had a job. 0:05:56.120 --> 0:05:59.350 You thought you had a job yesterday until the votes 0:05:59.370 --> 0:06:01.909 started getting counted, and now you've got no job. 0:06:01.950 --> 0:06:02.210 Right. 0:06:04.490 --> 0:06:07.630 You have no staff and no office now in Washington. 0:06:08.410 --> 0:06:12.350 Chairman, I make a joke about it, folks. He's congressman 0:06:12.370 --> 0:06:15.130 because I think he started out running for office when 0:06:15.150 --> 0:06:17.040 he was 15. Yeah, exactly. I think it was something 0:06:17.440 --> 0:06:20.279 like that. He was chairman of the House Financial Services 0:06:20.320 --> 0:06:24.040 Committee looking at our military budget. Now, in this lame duck, 0:06:24.640 --> 0:06:27.620 I believe somehow we have to pay the sailors on 0:06:27.660 --> 0:06:31.640 board three aircraft carriers. We've got to pay fighter pilots 0:06:31.730 --> 0:06:35.400 in Iran money. Give us a window into the debate 0:06:35.520 --> 0:06:39.170 in a lame duck session over defense appropriations. 0:06:39.760 --> 0:06:40.000 Sure. 0:06:40.310 --> 0:06:42.350 You have the president asking for a trillion and a 0:06:42.350 --> 0:06:44.190 half dollars of new spending. 0:06:44.990 --> 0:06:51.750 You have the secretary of defense who has faced impeachment 0:06:51.790 --> 0:06:56.000 charges in the House with a a few Republicans being 0:06:56.020 --> 0:06:58.560 willing to side with Democrats on those charges. 0:06:59.460 --> 0:07:02.460 You have the senators that appointed. 0:07:02.080 --> 0:07:06.520 Him having buyer's remorse and wanting to take action against 0:07:06.680 --> 0:07:09.790 Pete Hagseth. And at the same time, you have a 0:07:09.880 --> 0:07:14.430 continuing resolution that the government's operating under that expires December 11th. 0:07:15.910 --> 0:07:19.450 And a defense policy initiative that we've passed successfully every 0:07:19.510 --> 0:07:22.530 single year since Truman was president. 0:07:22.570 --> 0:07:22.690 Yeah. 0:07:23.500 --> 0:07:26.120 Called the National Defense Authorization Act. This is tough. 0:07:26.700 --> 0:07:29.700 This confluence of events and election results makes it tough 0:07:29.740 --> 0:07:33.590 to pass the policy and the dollars to keep the 0:07:33.630 --> 0:07:35.670 government open. That's going to be the first pressure point. 0:07:35.950 --> 0:07:38.880 I think what will happen is a continued resolution. You'll 0:07:38.900 --> 0:07:41.770 not see a defense plus up. But you'll see the 0:07:41.810 --> 0:07:47.150 defense policy NDAA bill get signed into law barely by 0:07:47.270 --> 0:07:51.800 Christmas because much of that can be bipartisan and limited 0:07:51.880 --> 0:07:52.380 in nature. 0:07:52.820 --> 0:07:55.140 So I think that's what we'll see. Permitting reform is 0:07:55.160 --> 0:07:56.700 the next thing on the docket. 0:07:57.950 --> 0:08:00.890 We'll see about the mood here among Democrats on whether 0:08:00.910 --> 0:08:02.050 or not they want to continue. 0:08:02.510 --> 0:08:03.310 Those negotiations. 0:08:03.330 --> 0:08:05.390 Paul, on the oil barometer here, we're trying to bring 0:08:05.420 --> 0:08:09.240 the markets into the discussion this morning. Brent crude down 0:08:09.280 --> 0:08:12.520 to one oh one ninety six down a dollar sixty four. 0:08:12.580 --> 0:08:14.240 Call that the Iran barometer. 0:08:14.280 --> 0:08:14.480 Yes. 0:08:14.640 --> 0:08:15.360 Post election. 0:08:15.380 --> 0:08:16.020 I think you're right, Tom. 0:08:16.560 --> 0:08:19.520 Patrick, give us a sense just with this, you know, 0:08:19.520 --> 0:08:21.700 12 hours of kind of perspective here. What's the status 0:08:21.740 --> 0:08:24.730 of the MAGA movement within the Republican Party? 0:08:24.750 --> 0:08:26.890 Shaken. Shaken. 0:08:27.660 --> 0:08:33.459 Shaken, but they didn't show up. I think the key 0:08:33.500 --> 0:08:36.579 thing we see yesterday is that they didn't vote. Why 0:08:36.600 --> 0:08:37.160 didn't they vote? 0:08:37.700 --> 0:08:40.910 Is it a level of exhaustion or are they not 0:08:40.950 --> 0:08:45.130 a movement anymore? All these political parties here in the 0:08:45.150 --> 0:08:46.870 United States are coalition parties. 0:08:47.960 --> 0:08:48.300 They are. 0:08:48.559 --> 0:08:52.390 That's just, that's what they are. MAGA is. 0:08:54.490 --> 0:08:58.670 A new coalition, electoral coalition built around the president. The 0:08:58.700 --> 0:09:00.619 president was on the ballot, even though he said, you 0:09:00.860 --> 0:09:03.360 have to treat it like I'm on the ballot. And 0:09:03.380 --> 0:09:07.179 the MAGA coalition did not come out. Part of it 0:09:07.220 --> 0:09:12.620 got fragmented because of the focus on illegal immigration by 0:09:12.700 --> 0:09:16.380 Kristi Noem, which inflamed the Hispanic community that voted in 0:09:16.470 --> 0:09:19.510 President Trump in key states like Texas. 0:09:21.309 --> 0:09:21.850 They stayed home. 0:09:22.350 --> 0:09:25.510 So part of it was the president's people and their 0:09:25.580 --> 0:09:29.340 initiatives broke up the MAGA coalition. The other part was 0:09:29.400 --> 0:09:31.820 they just stayed at home. So how do you get 0:09:31.840 --> 0:09:35.179 them back out? Are they done with the experiment of 0:09:35.210 --> 0:09:38.290 voting for Republicans? A lot has to be determined there. 0:09:39.240 --> 0:09:43.000 Let me get one more in here, Chairman McHenry, if 0:09:43.100 --> 0:09:45.319 I could, and it's just as simple as I can. 0:09:45.920 --> 0:09:51.160 There's always a turnover. Do you expect cabinet officials, other 0:09:51.250 --> 0:09:55.110 senior Trump officials to resign in the coming days and 0:09:55.150 --> 0:09:58.110 weeks and just move on in a normal format? 0:10:00.110 --> 0:10:01.890 I think this is their last chance. 0:10:02.230 --> 0:10:03.570 I think you're going to see a turn in the 0:10:03.610 --> 0:10:07.760 cabinet because otherwise they have to ride it out for 0:10:07.780 --> 0:10:12.520 the next two years. And with a solidly Democratic Senate, 0:10:13.400 --> 0:10:15.760 it's going to be very difficult for the president to 0:10:15.780 --> 0:10:18.000 get any confirmation through the Senate. 0:10:18.260 --> 0:10:20.370 I have to ask a selfish question that comes up 0:10:20.450 --> 0:10:23.870 in our conversations off mic all the time. What is 0:10:23.910 --> 0:10:27.150 your basic take on the state of the Pentagon today? 0:10:27.650 --> 0:10:32.300 and the senior officer's relationship with the Secretary of Defense? 0:10:33.220 --> 0:10:35.720 Oh, look, I mean, we've heard more about this, the 0:10:35.740 --> 0:10:38.420 politics of the Pentagon, in the last two years than 0:10:38.440 --> 0:10:39.300 we've ever heard. 0:10:39.320 --> 0:10:43.580 And so it's a fractious relationship. 0:10:45.080 --> 0:10:48.979 And the president certainly has shown that he has confidence 0:10:49.059 --> 0:10:54.030 in Secretary Hegg, Seth. and supports the initiatives that he's taking. 0:10:54.590 --> 0:10:57.459 That's not the case on Capitol Hill where there's bipartisan opposition. 0:10:57.820 --> 0:11:00.420 We'll see what takes place in the next six weeks 0:11:01.160 --> 0:11:05.250 on action there. And we'll see whether or not Secretary 0:11:05.270 --> 0:11:07.670 Hanks sticks around for the rest of the ride. 0:11:07.870 --> 0:11:11.690 It is something about public participation. As a junior in college, 0:11:11.830 --> 0:11:17.130 Patrick McHenry ran for the North Carolina House of Representatives. 0:11:17.330 --> 0:11:19.550 I wasn't doing that. I was looking for the marginal 0:11:19.590 --> 0:11:24.510 Jenny Cremale. Patrick McHenry was getting it done. Thank you 0:11:24.530 --> 0:11:26.950 so much for your work with Bloomberg, Patrick McHenry. And 0:11:27.300 --> 0:11:33.920 your perspective this post-election day. Stay with us. More from 0:11:34.020 --> 0:11:36.609 Bloomberg Surveillance coming up after this. 0:11:43.870 --> 0:11:47.469 You're listening to the Bloomberg Surveillance Podcast. Catch us live 0:11:47.550 --> 0:11:50.730 weekday afternoons from 7 to 10 a.m. Eastern. Listen on 0:11:50.830 --> 0:11:54.089 Apple CarPlay and Android Auto with the Bloomberg Business app 0:11:54.309 --> 0:11:56.010 or watch us live on YouTube. 0:11:56.470 --> 0:12:00.949 Libby Cantrell is with PIMCO. She brings a prodigious narrowness 0:12:01.250 --> 0:12:05.950 and a look at the step-by-step move of our legislation 0:12:06.790 --> 0:12:11.630 in Washington. So we have a lame duck legislative deadline, 0:12:11.690 --> 0:12:16.880 December 11th. within the media, to me, it's cursory. It's like, yeah, 0:12:16.900 --> 0:12:19.140 there's a phrase, lame duck, da, da, da. Give us 0:12:19.200 --> 0:12:24.060 the inside baseball feel of Republicans in a lame duck 0:12:24.140 --> 0:12:28.890 session having to pay soldiers and sailors just as one idea. 0:12:28.910 --> 0:12:32.130 Yeah, I mean, this is going to be, I mean, 0:12:32.150 --> 0:12:35.369 a very busy lame duck. At least that's one scenario. 0:12:35.410 --> 0:12:37.730 The other scenario is that nobody shows up because they've 0:12:37.770 --> 0:12:39.910 lost their seats and it's really difficult to come. 0:12:39.790 --> 0:12:41.720 Back to Washington. They literally lose their offices, right? 0:12:41.910 --> 0:12:42.430 Yeah, yes. 0:12:42.800 --> 0:12:45.439 Yeah, and oftentimes they're working out of there. It's in 0:12:45.480 --> 0:12:46.820 January where there's a holdover. 0:12:46.840 --> 0:12:49.120 Oh, so they lose the office in January. 0:12:49.160 --> 0:12:49.559 Yeah. 0:12:49.620 --> 0:12:52.620 What do they do with their apartments or like their families? 0:12:52.800 --> 0:12:54.780 Well, then, I mean, there's going to be a lot 0:12:54.820 --> 0:12:56.500 of kind of recoupling, if you will. A lot of 0:12:56.540 --> 0:12:58.780 members of Congress live together as roommates. This is sort 0:12:58.830 --> 0:13:01.370 of like a dirty little secret in Washington because they 0:13:01.410 --> 0:13:03.010 have to afford two homes, right? 0:13:03.050 --> 0:13:04.570 Like back in the 19th century. Right. 0:13:04.910 --> 0:13:08.270 Basically, Tom, they also I mean, no apologies for members 0:13:08.309 --> 0:13:10.210 of Congress here, but they haven't gotten a pay raise 0:13:10.230 --> 0:13:12.610 since the early aughts. So this is you know, they're 0:13:12.650 --> 0:13:14.700 not necessarily making a lot of money on a real basis. 0:13:15.400 --> 0:13:17.200 So I think it could be a very busy lame 0:13:17.220 --> 0:13:19.439 duck session where you, of course, have the blocking, tackling 0:13:19.460 --> 0:13:23.120 the NDAA government funding, as you alluded to. But I 0:13:23.179 --> 0:13:25.880 also think you could see something like permitting reform actually 0:13:26.020 --> 0:13:28.870 get some traction. That is a huge bill that has 0:13:28.929 --> 0:13:33.330 been for has people who are sort of traditional energy advocates. 0:13:34.510 --> 0:13:39.050 advocating for basically allows for more sort of traditional energy 0:13:39.170 --> 0:13:42.490 assets to be built, reduces red tape, but then also 0:13:42.530 --> 0:13:45.330 reduces red tape for renewables and electricity. 0:13:45.390 --> 0:13:48.630 Oh, come on. To cut to the chase, Republicans going 0:13:48.700 --> 0:13:51.199 out the door want to drill in Alaska and they're 0:13:51.220 --> 0:13:53.199 going to get it done before the Democrats show up. 0:13:53.200 --> 0:13:54.700 Yeah, but by the way, they still need to have 0:13:54.740 --> 0:13:56.459 a bipartisan vote in the Senate. So I think you 0:13:56.480 --> 0:13:58.180 could get Democrats on board, too, because I think Democrats 0:13:58.220 --> 0:13:59.460 are going to want to clear the decks here. I mean, 0:13:59.760 --> 0:14:04.679 this is this is such a rebuke. This is not 2006, 0:14:04.679 --> 0:14:06.400 which is what we were saying to our clients in 0:14:06.440 --> 0:14:08.440 the last couple of weeks, that this could look like 0:14:08.480 --> 0:14:11.020 a wave that you saw in 2006, where Democrats took 0:14:11.059 --> 0:14:14.970 back both the House and the Senate. This is 1974. 0:14:14.970 --> 0:14:20.610 This is a total referendum against the executive branch. And 0:14:20.690 --> 0:14:23.010 so you're going to have, I mean, the fact that 0:14:23.030 --> 0:14:26.380 you were talking about potentially 40 to 50 seats flipping 0:14:26.480 --> 0:14:28.920 for Democrats. I mean, Democrats are winning in places that 0:14:28.940 --> 0:14:31.340 they did not even know that they were competitive. They 0:14:31.380 --> 0:14:34.720 look like they're going to win in Nevada, Congressional District 2. 0:14:34.720 --> 0:14:36.380 There's never been a Democrat there, right? That was a 0:14:36.620 --> 0:14:39.950 district created in like 45 years ago. There's never been 0:14:39.970 --> 0:14:42.280 a Democrat represented. So again, they are winning in places 0:14:42.330 --> 0:14:44.530 that they didn't even know that they were competitive. So 0:14:44.570 --> 0:14:46.330 they are going to want to, I think, clear the 0:14:46.410 --> 0:14:48.989 decks to the extent that they can to try to 0:14:49.050 --> 0:14:52.010 then really focus on the things that they were actually 0:14:52.070 --> 0:14:55.270 elected to do, which is to try to do something 0:14:55.330 --> 0:14:57.830 on affordability and then also to try to provide some 0:14:57.890 --> 0:14:59.270 oversight to the executive branch. 0:14:59.290 --> 0:15:02.950 Okay, so let's go to the given this mandate that 0:15:02.990 --> 0:15:07.010 the Democratic Party has received here, what can they realistically do? 0:15:07.430 --> 0:15:10.370 Yeah, so there are obviously still constraints. President Trump is 0:15:10.430 --> 0:15:14.030 still in the White House. They're going to have big majorities, 0:15:14.070 --> 0:15:16.600 but nothing close to a veto-proof majority. So of course 0:15:16.640 --> 0:15:19.140 they can't overturn a veto. So there is going to 0:15:19.180 --> 0:15:23.700 be some sort of constraint. However, with 55 potentially in 0:15:23.740 --> 0:15:26.560 the Senate, I mean, you're going to have a Democratic 0:15:26.580 --> 0:15:28.600 Party that is going to have to have, they're going 0:15:28.620 --> 0:15:31.710 to have to show, the voters that they can also govern. 0:15:31.730 --> 0:15:34.030 So this can't just be an opposition party. They can't 0:15:34.150 --> 0:15:37.310 just be doing oversight and impeachment of Pete Hegseth or 0:15:37.330 --> 0:15:39.130 what have you. They're going to have to show that 0:15:39.170 --> 0:15:40.930 they can govern. And I think that means that there 0:15:41.030 --> 0:15:43.359 is some window for a deal. The one thing I 0:15:43.400 --> 0:15:45.180 think that's really important to point out here for the 0:15:45.220 --> 0:15:48.020 markets is this is going to be a more moderate 0:15:48.060 --> 0:15:51.330 group of Democrats than we have seen for a long time. 0:15:51.610 --> 0:15:52.850 There are going to be more blue dogs. 0:15:52.910 --> 0:15:57.250 This is like, be still my deficit heart, because they're 0:15:57.290 --> 0:16:00.970 winning in places that are, again, sort of more traditionally Republican. 0:16:00.990 --> 0:16:02.600 So I'm going to rip up the script. How did 0:16:02.620 --> 0:16:07.380 Jeffries and Schumer bring this more moderate Democrat party into 0:16:07.440 --> 0:16:12.560 the stereotype of the liberal left Democrats? What a thread 0:16:12.600 --> 0:16:13.760 and needle exercise. 0:16:13.800 --> 0:16:16.780 Yeah. Well, I mean, again, I think this is what 0:16:16.800 --> 0:16:19.460 the voters really did. And, you know, I think to 0:16:19.500 --> 0:16:23.380 Schumer's great credit in particular, you know, love Schumer, hate Schumer, 0:16:23.420 --> 0:16:25.370 however you feel about him or dislike him or what 0:16:25.390 --> 0:16:29.390 have you, as the future majority leader again. I mean, 0:16:29.430 --> 0:16:33.370 he really focused on candidate equality. And he focused on 0:16:33.490 --> 0:16:36.110 candidate equality that didn't pass the purity test at the 0:16:36.150 --> 0:16:40.630 national level, but actually were bespoke to their local dynamics. 0:16:40.730 --> 0:16:42.470 And I'm going to do a shout out. Brett Baer 0:16:42.510 --> 0:16:45.270 last night on Fox, as they were picking up the 0:16:45.330 --> 0:16:49.310 disastrous pieces, he was brilliant on this. And Brett really 0:16:49.430 --> 0:16:51.670 focused on candidate quality. 0:16:52.430 --> 0:16:55.360 I mean, look at what's happening in Mississippi, right? You know, 0:16:55.390 --> 0:16:58.740 Tallarico in Texas, Annie Andrews in South Carolina. These are 0:16:58.780 --> 0:17:02.200 not folks who are necessarily running on the national Democratic platform. 0:17:02.240 --> 0:17:04.520 They're running on a very localized platform. 0:17:04.560 --> 0:17:08.280 I'm so intimidated by Libby Cantrell. I have to take notes. Yeah, 0:17:08.340 --> 0:17:11.200 I know. That bill's on my lap. Okay. I didn't 0:17:11.260 --> 0:17:16.220 know this. A veto proof is both houses. 0:17:16.240 --> 0:17:16.310 Yes. 0:17:16.300 --> 0:17:21.250 290 House members, which is way away from 258 or whatever. Yeah. 0:17:21.310 --> 0:17:25.669 And in the Senate, 67 senators. Yeah. So the president's 0:17:25.710 --> 0:17:28.030 got a rock solid veto pen. 0:17:28.450 --> 0:17:31.390 Yes, except I will say on maybe a couple of issues. 0:17:31.770 --> 0:17:35.090 One is on tariffs on Canada. That has a huge, 0:17:35.109 --> 0:17:37.280 I mean, look what happened right in the upper Midwest, 0:17:37.300 --> 0:17:40.580 like massive rebuke on the tariff agenda or what have you. 0:17:40.900 --> 0:17:43.720 I could see that actually getting that to that veto 0:17:43.760 --> 0:17:47.359 proof majority. Also, Russia sanctions. That is something that really 0:17:48.100 --> 0:17:51.490 upset Republicans on the Hill, also Democrats, I could see 0:17:51.530 --> 0:17:55.109 that actually getting to a veto proof majority. But outside 0:17:55.150 --> 0:17:57.530 of that, I mean, it's going to have to require 0:17:57.869 --> 0:18:00.560 both compromise to the president, but also compromise the Republicans. 0:18:00.600 --> 0:18:03.920 Because remember, Tom, you also need a filibuster proof majority 0:18:03.960 --> 0:18:07.100 for most legislation. The filibuster is not going anywhere. That 0:18:07.140 --> 0:18:10.090 means Democrats need to actually compromise with Republicans on some things. 0:18:10.310 --> 0:18:12.609 So there's definitely going to be a constraint. But I 0:18:12.650 --> 0:18:16.129 would be very surprised if Democrats don't pivot to compromising 0:18:16.150 --> 0:18:17.540 with the president, at least on some things. 0:18:17.760 --> 0:18:20.399 Did you see Taylor Swift at the game when the 0:18:20.440 --> 0:18:21.920 Broncos beat KC? 0:18:21.940 --> 0:18:24.180 Can we talk about that game? God, that game was ugly. 0:18:24.220 --> 0:18:25.770 You know what? I really do. 0:18:26.190 --> 0:18:29.510 Appreciate that you bring up the fact that the Broncos 0:18:29.650 --> 0:18:32.970 record belies how ugly these games have been. You know what? 0:18:33.010 --> 0:18:34.869 We will take it. A W is a W in 0:18:34.890 --> 0:18:35.730 the words of my 15-year-old. 0:18:35.750 --> 0:18:39.150 We're migrating from Broncos type to Kansas City Chiefs. Joining 0:18:39.210 --> 0:18:41.500 us now in Portland, Libby Cantrell. Thank you so much. 0:18:41.760 --> 0:18:47.419 Thanks so much. Stay with us. More from Bloomberg Surveillance 0:18:47.500 --> 0:18:48.860 coming up after this. 0:18:56.119 --> 0:18:59.700 You're listening to the Bloomberg Surveillance Podcast. Catch us live 0:18:59.780 --> 0:19:02.959 weekday afternoons from 7 to 10 a.m. Eastern. Listen on 0:19:03.060 --> 0:19:06.340 Apple CarPlay and Android Auto with the Bloomberg Business app 0:19:06.540 --> 0:19:08.240 or watch us live on YouTube. 0:19:08.680 --> 0:19:11.930 This could be a normal conversation, but I don't think 0:19:11.990 --> 0:19:15.790 anything's normal this morning. Myra Carlin with us with her 0:19:15.830 --> 0:19:20.790 public services, U.S. Assistant Secretary of Defense for Strategy, Plans 0:19:20.970 --> 0:19:24.669 and Capabilities. Mara, I just got to rip up the 0:19:24.710 --> 0:19:27.940 script here this morning. You're having a cup of coffee 0:19:27.980 --> 0:19:31.639 with Secretary Hegseth. And what do you say to him 0:19:31.740 --> 0:19:36.200 as a grizzled operative about what to do next? What 0:19:36.240 --> 0:19:37.160 would you advise? 0:19:38.400 --> 0:19:41.030 Look, I'm guessing other things are on Pete Hegseth's mind 0:19:41.070 --> 0:19:43.670 right now. But if he wanted to talk about how 0:19:43.710 --> 0:19:46.149 war is changing, I would tell him he needs to 0:19:46.210 --> 0:19:48.270 stop obsessing over technology. 0:19:48.790 --> 0:19:49.030 That. 0:19:50.150 --> 0:19:55.689 fundamentally there are elements of war that haven't changed, thinking 0:19:55.780 --> 0:20:00.120 about who kills, who dies, who decides, figuring out what 0:20:00.180 --> 0:20:03.420 our objectives are and our theory of victory for actually 0:20:03.500 --> 0:20:06.679 achieving those, that all still matters a lot. And whatever 0:20:06.780 --> 0:20:10.480 cool whiz-bang gizmo he brings into the military, that's not 0:20:10.520 --> 0:20:11.860 going to be the thing that wins the war. 0:20:12.730 --> 0:20:15.360 How has maybe, do you think the U.S. 0:20:15.390 --> 0:20:19.660 Policy as it relates to Iran in particular, maybe even Ukraine, 0:20:19.760 --> 0:20:22.180 do you expect any changes now that there's been this 0:20:22.980 --> 0:20:26.560 seismic change in Congress with Democrats taking control? Do you 0:20:26.580 --> 0:20:30.210 think the policies of this White House will be impacted? 0:20:31.560 --> 0:20:34.200 It's hard to predict this White House, to state the obvious. 0:20:34.369 --> 0:20:37.250 But I sure hope that there is a different set 0:20:37.270 --> 0:20:40.670 of conversations about what the U.S. is trying to achieve 0:20:41.210 --> 0:20:44.690 in Iran. Look, I can make up a bunch of objectives, 0:20:45.030 --> 0:20:48.590 but it was entirely unclear when this war started. Was 0:20:48.670 --> 0:20:50.830 it to deal with the nuclear program? Was it to 0:20:50.869 --> 0:20:54.060 deal with the missile program? Was it to support the 0:20:54.180 --> 0:20:57.260 Iranian public who had gone through this kind of massive and. 0:20:57.619 --> 0:21:00.780 Quite lethal uprising in January? 0:21:01.260 --> 0:21:04.619 It's not clear what objective they were trying to achieve 0:21:04.760 --> 0:21:08.129 other than fundamentally to collapse the regime. So I expect 0:21:08.190 --> 0:21:12.630 a lot harder questions coming from Congress. And Congress will 0:21:12.650 --> 0:21:15.730 have the ability to do things like take away resources 0:21:16.080 --> 0:21:18.700 for a war that's just profoundly confused. 0:21:19.520 --> 0:21:21.600 I look at this and is it true that you 0:21:21.640 --> 0:21:23.600 work for six defense secretaries? 0:21:24.470 --> 0:21:25.290 I did indeed. 0:21:25.770 --> 0:21:29.970 That's extraordinary. I've got an arch question. I say this 0:21:29.990 --> 0:21:34.730 with immense respect for Republicans, Democrats and independents listening. If 0:21:34.790 --> 0:21:38.659 I'm talking to Admiral Stravitas or General Kimmett, General Hodges 0:21:39.060 --> 0:21:41.560 and others that we speak to, members of the CIA. 0:21:42.420 --> 0:21:46.700 This is the money question, folks. Mara Carlin, with that experience, 0:21:47.280 --> 0:21:50.840 do you suggest after this we can get back to 0:21:50.859 --> 0:21:54.470 a normal Pentagon or is it forever shattered? 0:21:56.090 --> 0:21:58.230 I think you can go back, but it will be 0:21:58.470 --> 0:22:03.909 very difficult. It will require serious and thoughtful leadership. It 0:22:03.950 --> 0:22:10.100 will require an effort to re-infuse professionalism and discipline into 0:22:10.119 --> 0:22:13.820 the force. It will be difficult, but it's possible. I 0:22:13.880 --> 0:22:15.000 remain optimistic. 0:22:15.380 --> 0:22:15.820