Speaker 1: Now from our nation's capital. This is Bloomberg Sound On. Basically,
Speaker 1: we're out of money. That's why today in order to
Speaker 1: sustain Ukraine as a as it continues to fight, and
Speaker 1: I'm sending Congress a supplemental budget request. Bloomberg Sound On Politics,
Speaker 1: Policy and perspective from DC's top name. We all expected
Speaker 1: this quarder would be a bit slower. They have tried
Speaker 1: to make the case that this is at plutin price
Speaker 1: hype that has fallen flat Inslation has gone off every month.
Speaker 1: Pickture biking im President Bloomberg Sound On with Joe Matthew
Speaker 1: on Bloomberg Radio. Surprise Surprise, the economy contracts in the
Speaker 1: first quarter, and President Biden asks Congress for tens of
Speaker 1: billions to fund Ukraine. Welcome to the fastest hour in politics.
Speaker 1: As we join you again from Bloomberg World Headquarters in
Speaker 1: New York. Will zero in on today's GDP report and
Speaker 1: consider the political imp occasions as Congress makes its plans
Speaker 1: for the rest of the year with Ed Mills, Washington
Speaker 1: policy analyst at Raymond James. Later, our conversation with barat
Speaker 1: Rama Murdy, Deputy Director of the White House National Economic Council.
Speaker 1: Also g d P of course on the agenda and
Speaker 1: a major effort to help small business at the White
Speaker 1: House today that we'll be talking about. Senator Joe Manchin
Speaker 1: wants to make a deal on energy and climate. Are
Speaker 1: we really doing this again? We'll talk about it with
Speaker 1: our panel Bloomberg Politics contributors Jeanie Chanzano and Rick Davis.
Speaker 1: Kind of surreal to see the word contraction on the
Speaker 1: Bloomberg screen this morning watching surveillance. What GDP drops unexpectedly
Speaker 1: one point four percent, coming in below all but one
Speaker 1: estimate in a Bloomberg survey. But it had much to
Speaker 1: do with a trade imbalance than anything. Certainly was not
Speaker 1: due to consumers pulling back. So it's kind of a
Speaker 1: counterintuitive story here in a way. Then again, one more
Speaker 1: of these and we fulfill the definition of a recession.
Speaker 1: Right this morning, I asked the Commerce Secretary Gina Romando
Speaker 1: has joined us on balance of power, if that's a
Speaker 1: concern for her, if she's reading into this any further
Speaker 1: than this quarter here she is. If you look at
Speaker 1: small business starts, um, they're higher than ever. Wages her
Speaker 1: up and talk to CEOs about their businesses. They you know,
Speaker 1: the economy is resilient and growing, so at this point,
Speaker 1: obviously you don't want to see this, you know, the disappointing.
Speaker 1: You never want to see it. But we weren't surprised,
Speaker 1: and I don't think it's a trend. Okay, a trend
Speaker 1: one quarter does not make, which means the Fed keeps hiking.
Speaker 1: So nothing to see here, move right along or is there?
Speaker 1: Let's talk about it with Ed Mills, Washington policy analyst
Speaker 1: and managing director at Raymond James. I'm guessing Ed, this
Speaker 1: is not the number that you or your firm was
Speaker 1: looking for. Here. It was a bit of a shocker,
Speaker 1: but also people don't seem to be terribly concerned about it,
Speaker 1: considering why when you look under the hood, Joe, when
Speaker 1: you look under the hood, um, you know, certainly tells
Speaker 1: a different story. But when I look at this from
Speaker 1: a political angle, I'm reminded that in politics, when you're
Speaker 1: explaining you're losing and so uh if you do have
Speaker 1: two consecutive quarters, you mentioned the R word. Uh. Here
Speaker 1: in d C. The R word is great for Republicans
Speaker 1: because Biden has wanted to sell the Biden boom heading
Speaker 1: into the midterm elections. Um, and this really changes the conversation,
Speaker 1: even if it's not true. Um, the rhetoric here really
Speaker 1: is what's going to matter from a political perspective. Well,
Speaker 1: let's let's hold on to that view for a moment,
Speaker 1: because you know, the President didn't get out of the
Speaker 1: Roosevelt Room without a question on the economy and a
Speaker 1: possible recession. He was there, of course, someone ask you
Speaker 1: about this, had to commit tens of billions more to Ukraine.
Speaker 1: But as the questions came, number three, number four, he
Speaker 1: was asked about this. And the President doesn't seem too
Speaker 1: concerned about a recession here. He is, we need this boom,
Speaker 1: the support you created, this fight for freedom, and our
Speaker 1: NATO allies are you partners. They're gonna pay their fair
Speaker 1: share of the costs as well. But we have to
Speaker 1: do this. We have to do our part as well.
Speaker 1: The cost of this fight. Uh, it's not cheap, but
Speaker 1: kvy new aggression is going to be more costly if
Speaker 1: we allow it to happen. He was talking about Ukraine there.
Speaker 1: I don't know if we have the other one, uh, ed,
Speaker 1: But the idea in his response was it's not likely
Speaker 1: that we move into recession much like we heard from
Speaker 1: his Commerce secretary, uh, Gina Romando. Is that a hopeful
Speaker 1: view or is it when you share? Well, that's the
Speaker 1: view he has to have. Um. You know, the president
Speaker 1: has to be a cheerleader for the economy. The president
Speaker 1: has to kind of highlight some of the economic indicators
Speaker 1: that on paper have been really positive in terms of
Speaker 1: where the consumer is. We've seen through earning seasons. Uh,
Speaker 1: some of the Bank's kind of highlighting the balances and
Speaker 1: individual checking accounts. But the problem politically has been, um,
Speaker 1: what it looks like on paper versus what it feels
Speaker 1: like for the average American. And so where this is
Speaker 1: politically problematic for the president in for congressional Democrats is
Speaker 1: that Americans by a pretty sizable number already are saying
Speaker 1: that this country is on the wrong track. And if
Speaker 1: the economic data then changes to support that view, those
Speaker 1: are just more political headwinds that the president in congressional
Speaker 1: Democrats are facing come the voting time in November. This
Speaker 1: all comes against the backdrop of inflation and a pretty
Speaker 1: aggressive federal reserve. At this point, we're looking for a
Speaker 1: half point next week. There's talk of of seventy five
Speaker 1: basis points maybe at the meeting after ED. Does this
Speaker 1: report today do anything to change your expectations on that front? Joe,
Speaker 1: it doesn't. I do think that because of how you
Speaker 1: highlighted UM, you know, kind of the beneath the hood
Speaker 1: aspect of this um. You know, that doesn't change the
Speaker 1: trajectory of the FED UM. And I do think that
Speaker 1: that overall is going to continue to put pressure UM
Speaker 1: on you know, consumers as they look for mortgages in
Speaker 1: a lot of pocketbook issues. There is a hope that
Speaker 1: the FEDS tightening does tame inflation. I think the debate
Speaker 1: that I've had with clients as I've been on the
Speaker 1: road here at Raymond James this last week has been
Speaker 1: once the inflation indicators come down a little bit and
Speaker 1: we get some new confirmations on the FED board, how
Speaker 1: hawkish will the FED be able to remain? But near
Speaker 1: term this doesn't change. And Joe, for the party in charge,
Speaker 1: that's a problem. Let's talk more about the requests that
Speaker 1: he made. You just heard President Biden from earlier today.
Speaker 1: Thirty three billion dollars is the number. And from every
Speaker 1: lawmaker we have spoken with, this gets passed without even
Speaker 1: really it's almost a blank check who there's so much
Speaker 1: bipartisan supply word for funding Ukraine in this war Uh
Speaker 1: with Russia. The question that I will have beyond does
Speaker 1: that get past head because it seems to be a yes,
Speaker 1: is what's attached to it? Are we gonna try to
Speaker 1: attach COVID funding? Is there going to be a conversation
Speaker 1: about Title forty two supplemental for homeland for the border?
Speaker 1: What are you hearing, Joe? You're exactly right to bring
Speaker 1: this up because there is no doubt that there is
Speaker 1: overwhelming support for this package for Ukraine. It's really just
Speaker 1: a question of timing. Uh. You've already seen congressional Republicans
Speaker 1: come out and say if the COVID relief package gets
Speaker 1: added to it, Uh, it could sink both packages. I
Speaker 1: don't think that's the case, but Republicans do like to
Speaker 1: or prefer to have this as two separate votes. That's
Speaker 1: not an issue in the House. The House can pass anything,
Speaker 1: but to get this through the Senate, you do need
Speaker 1: a bipartisan vote. You do need those sixty votes on
Speaker 1: the COVID package. That's more likely than not to still happen. UM.
Speaker 1: But the vote is going to have to take place
Speaker 1: on Title forty two. We had a judge this week
Speaker 1: strike that down, which is going to put even more
Speaker 1: pressure on Democrats uh to vote to keep Title forty
Speaker 1: two in place, keep um the you know, pandemic restrictions
Speaker 1: on asylum and uh kind of refugee seekers in the
Speaker 1: United States on the other side of the US border.
Speaker 1: So politically, this is going to be a tough needle
Speaker 1: to thread, especially in the Senate for Chuck Schumer. And
Speaker 1: the more time you spend on this is time that
Speaker 1: you're not spending on other priorities, uh, such as reconciliation,
Speaker 1: which um Democrats really do want to take another run
Speaker 1: at it. So every day of floor time is a
Speaker 1: day away from other priorities. That's the bigger issue. Well,
Speaker 1: that reconciliation idea. And I know that they wanted to
Speaker 1: make another turn and still might this year that that
Speaker 1: option is available, but it may not fly if now
Speaker 1: Joe Mansion once again the wrench in the works here.
Speaker 1: He wants to come up with a deal that gets
Speaker 1: bipartisan support and does not require reconciliation, and it would
Speaker 1: be some sort of mix of energy and climate. I
Speaker 1: don't think we'd call it build back better or make
Speaker 1: America whatever. It would have to have a new brand
Speaker 1: and a new marketing campaign. But if that's what Joe
Speaker 1: Mansion wants, I'm assuming he's not playing along with this
Speaker 1: reconciliation idea once again. You think, yeah, Joe, that's not
Speaker 1: gonna happen. I'm not gonna know. I mean, we're yeah,
Speaker 1: it's it's um kind of more and more we're seeing
Speaker 1: kind of from conversations here in DC, the Biden administration
Speaker 1: being concerned whether or not they can get Mansion to
Speaker 1: a table. I do think that part of this is,
Speaker 1: you know, fully energy specific. You know, he has a
Speaker 1: chairmanship in a gabble where he wants to have a process,
Speaker 1: at least in his committee. It's been shocking to me
Speaker 1: that they have not kind of listened to that desire
Speaker 1: for him to shape this package. If they get reconciliation,
Speaker 1: if there's any legislative package, it is going to be
Speaker 1: first and foremost an energy package. Some healthcare provisions, maybe
Speaker 1: a couple of other, uh smaller scale down versions of
Speaker 1: social spending. But you know, the more they kind of
Speaker 1: don't listen to exactly what he's asking for and don't
Speaker 1: move in that direction. That's a step away from getting
Speaker 1: anything done. Why not just have him write it. I mean,
Speaker 1: didn't we already see all of this. We saw this
Speaker 1: movie last year. We already know the ending. It doesn't
Speaker 1: play well for the White House yet. Yeah. I think
Speaker 1: that the thought from the White House was as much
Speaker 1: as they needed to have some hard thought wins and
Speaker 1: getting him on board because of the voice of the
Speaker 1: Progressives was pushing in. Senator Sanders, chairman of the Budget
Speaker 1: Committee in charge of the process started off at six
Speaker 1: trillion dollars. You also had to have hard fought losses
Speaker 1: um and um. You know, you had to show that
Speaker 1: they were standing up to something, to show the Democratic
Speaker 1: base what was not achievable. I think they spent too
Speaker 1: much time there and didn't recognize that Mansion was going
Speaker 1: to hold as farm as he was. The inflation picture,
Speaker 1: the economic picture has only worsened, so they missed that window.
Speaker 1: They want to get something done. We'll see if we
Speaker 1: erupted in history again this year, and we'll talk to
Speaker 1: Ed about it. Great to spend time with Ed Mills,
Speaker 1: Washington policy analyst at Raymond James will assemble the panel next.
Speaker 1: This is Bloomberg. You're listening to Bloomberg Sound On with
Speaker 1: Joe Matthew on Bloomberg Radio as we bring in the
Speaker 1: panel following a really fascinating conversation with Ed Mills about
Speaker 1: the chances of real anything happening in Congress between now
Speaker 1: and the rest of the year, certainly in the conversation
Speaker 1: about Build Back Better, the sequel and whatever stripped down
Speaker 1: version we might end up with here, we're gonna be
Speaker 1: talking about this in just a moment with barat ram
Speaker 1: A Murdy, the Deputy Director of the White House National
Speaker 1: Economic Council. They've got a big event going on over
Speaker 1: there today for small businesses trying to unlock resources for
Speaker 1: small business that we'll talk with in a moment. Deputy
Speaker 1: Director Roma Murdy, Welcome to Bloomberg Radio. It's great to
Speaker 1: have you here. I'm going to ask you about this
Speaker 1: small biz event that you're hosting at the White House today.
Speaker 1: Looking forward to hearing about it. I'm just curious to
Speaker 1: get your your first reaction though to our g d
Speaker 1: P report today. Was it startling to see that word
Speaker 1: contraction on the screen this morning or did you see
Speaker 1: it coming? Well? I think that a number of analysts
Speaker 1: had predicted that because of some technical quirks and how
Speaker 1: the data is collected and analyzed that we would have
Speaker 1: the possibility of seeing a number like that. I do
Speaker 1: think that if you look under the hood of today's
Speaker 1: real court, what you see are continued signs of a
Speaker 1: resilient economy. You see very strong consumer spending, You see
Speaker 1: very very strong business investment, you see very strong residential investment.
Speaker 1: The reasons that it went negative are kind of more
Speaker 1: volatile data about trade and about inventories, and so if
Speaker 1: you take a look at the big picture here and
Speaker 1: get past the headline, I think you continue to see
Speaker 1: evidence a very strong economic recovery that, by many measures,
Speaker 1: is the strongest economic recovery of any leading economy in
Speaker 1: the world. Well, it's certainly how the market seems to
Speaker 1: be taking it in our analysis here at Bloomberg would
Speaker 1: would align with what you're saying that you know, in
Speaker 1: one instance, we had ships lined up, as you well know,
Speaker 1: uh brought at the ports up and down the West coast.
Speaker 1: A lot of those ships came in and so we
Speaker 1: had a massive trade imbalance here. Is there a chance
Speaker 1: that that might happen again in this quarter? Well, it's
Speaker 1: it's hard to predict, but I think your main point
Speaker 1: is correct, which is that part of what you are
Speaker 1: seeing here in the data is that some of the
Speaker 1: supply chain issues that we are grappling with for a
Speaker 1: significant chunk of last year coming out of COVID are
Speaker 1: starting to resolve themselves. One of the things the President
Speaker 1: is proud of is that working with business groups and labor,
Speaker 1: he was able to push the ports of l A
Speaker 1: and Long Beach. They opened twenty four hours a day,
Speaker 1: seven days a week, massively increase their throughput, and you know,
Speaker 1: we're starting to see some of those effects in the data.
Speaker 1: I think on the whole, it's a good sign for
Speaker 1: Americans that they're able to get their imported goods on
Speaker 1: time and in an efficient way. UM inflation is going
Speaker 1: to start coming in? Is that? Is this happening as
Speaker 1: you were hoping? Again, if you look at outside analysts
Speaker 1: and some other projections, inflation by many many, by many
Speaker 1: accounts is predicted to UH to temper and go down
Speaker 1: over the course of this year. Of course, there are
Speaker 1: many unpredictable things that could happen. I think if you
Speaker 1: look at the data that we have before, is right
Speaker 1: now there is very clear evidence that Number one the
Speaker 1: US economic recovery is the strongest in the world. Number two.
Speaker 1: If you look at I m F projections, the economic
Speaker 1: growth that's projected through the end of the year puts
Speaker 1: the United States number one among G seven countries. Number three.
Speaker 1: Household balance sheets, by many measures, have never been healthier,
Speaker 1: not for thirty years. You look at debt to debt
Speaker 1: to income ratio, the ability of folks to pay off
Speaker 1: credit card debt and other debts. Families as a whole
Speaker 1: are a very strong financial position, and that creates a
Speaker 1: good buffer for our time. You were a member of
Speaker 1: the COVID Congressional Oversight Commission, which oversaw the Treasuries management
Speaker 1: of stimulus from the Cares Act. You hear people now,
Speaker 1: I'm I'm sure barat as I do blaming the stimulus
Speaker 1: for overheating the economy. Are they right about that? When
Speaker 1: you look back on decisions that were made then, I
Speaker 1: think we were dealing with highly uncertain and uh and
Speaker 1: cataclysmic event. You know, we look, we saw unemployment reached
Speaker 1: levels that hadn't been reached since the Great Depression, and
Speaker 1: under those circumstances, policymakers overall, I think have the right
Speaker 1: approach let's get money into the hands of families, in
Speaker 1: the hands of small businesses that needed go big was
Speaker 1: the line. Then Yeah, and if you look at the quality,
Speaker 1: the the strength of our recovery, and the speed of
Speaker 1: our recovery, that paid dividends. I just want to go
Speaker 1: back and put people in the position that we were
Speaker 1: in before this president took office, and the nonpartisan Congressional
Speaker 1: Budget Office was projecting we would have unemployment about five
Speaker 1: percent for years to come and that we wouldn't reach
Speaker 1: three point six percent unemployment for many years from now. Instead,
Speaker 1: we reached three point six percent unemployment a couple months ago.
Speaker 1: So uh, that's made a really powerful difference in a
Speaker 1: lot of people's lives. Long term unemployment can be very
Speaker 1: scarring for folks. It's bad for families, it's bad for
Speaker 1: the economy. We avoided a lot of those negative effects,
Speaker 1: but you see it as a necessary cost to getting
Speaker 1: out of that crisis. As we spend time with Barat
Speaker 1: Rama Murty of the White House National Economic Council, which
Speaker 1: he helps to run as deputy director, Baratt, how are
Speaker 1: you helping to unlock resources for entrepreneurs in this time?
Speaker 1: We talked so much about inflation. You and I are
Speaker 1: right now, it can there can be a lot of
Speaker 1: challenges to starting a business. I know today that you're
Speaker 1: you're holding a major event for small business at the
Speaker 1: White House, UH to actually talk about the President's speaking
Speaker 1: about this what he refers to as the small business boom.
Speaker 1: What can you do to help somebody who's trying to
Speaker 1: start a business in this economic climate. I think what
Speaker 1: the report that came out today shows is that looking
Speaker 1: at one the first year of the Biden presidency, h
Speaker 1: an unprecedented historic number of Americans started new businesses. In fact,
Speaker 1: it was higher than in any prior year on record.
Speaker 1: Um it was higher for Hispanic entrepreneurs and and similarly
Speaker 1: a record higher for Black entrepreneurs. And so we're seeing
Speaker 1: entrepreneurs of color really getting in the game as well.
Speaker 1: It's a good story to tell. Bara Rama Murty. I
Speaker 1: wish I had more time with your deputy Director of
Speaker 1: the White House National Economic Council on Bloomberg. I'm Joe Matthew.
Speaker 1: Thanks for being with us on the fastest hour in politics.
Speaker 1: I'm Joe Matthew. You at World Headquarters in New York,
Speaker 1: and we've got our signature panel as we hope to
Speaker 1: have on days like these when the president is asked
Speaker 1: about a recession. And that is what happened today after
Speaker 1: he announced the big ask for Ukraine thirty three billion dollars.
Speaker 1: We discussed that with Ed Mills and it came with
Speaker 1: a bit of questioning. I don't know if the Communications
Speaker 1: Office planned this, but the President was asked about the
Speaker 1: GDP reports today. The chances of this may be happening
Speaker 1: twice serious have to be take a look and knowing
Speaker 1: it predictating recession. Now they're predicting their summer, predicting there
Speaker 1: may be a recession in what Why did he I'm
Speaker 1: not sure why he said that, Rick Davis, Genie Chanzano
Speaker 1: with us, Rick, is that the answer you would have
Speaker 1: advised him, No, talk about putting a punctuation mark on
Speaker 1: otherwise badness? Right, Uh, nothing to worry about today, but
Speaker 1: next year could be awful. Yeah. And and why go there? Um,
Speaker 1: Why try to predict a recession when you've you've actually
Speaker 1: got some underlying good news to talk about today. Uh,
Speaker 1: in the GDP numbers and stick to the positive. And Uh,
Speaker 1: I don't know, I mean maybe this was just another
Speaker 1: Biden is um We've seen this before and we're gonna
Speaker 1: see it again. Genie, are we gonna get a recession
Speaker 1: in three? I hope not? And you know I'm gonna
Speaker 1: get one in two. You know, let's let's hope not.
Speaker 1: But you know, I think the problem here is exactly
Speaker 1: what you and ed we're talking about. Any time you
Speaker 1: have to explain this, I can't tell you how many
Speaker 1: people I heard today add nauseam talking about well, go
Speaker 1: beyond the headline and look under the hood. You know,
Speaker 1: those kinds of metaphors are are disastrous politically because what
Speaker 1: they're saying is the thing that people are seeing and
Speaker 1: hearing and feeling. Don't worry about that, pay attention to
Speaker 1: this complicated thing which explains why everything you're feeling is wrong.
Speaker 1: I mean, to a certain extent. It's like the difference
Speaker 1: between macro and microeconomics. I go by Hamburger. It's expensive.
Speaker 1: You can tell me. Unemployment is you know, good, the
Speaker 1: number is good, but it's meaningless to me. And that's
Speaker 1: where I think the president has to really get to.
Speaker 1: He's got to talk about I feel your pain, and
Speaker 1: we're here to address it. And this is how you know,
Speaker 1: I know that that's an uphill battle as to how.
Speaker 1: But he's got to say he feels people's pain because
Speaker 1: you look at the polls, there's a lot of pain
Speaker 1: out there. Well, it's supposed to be his uh, his
Speaker 1: his strength, Rick is feeling your pain. Isn't that that
Speaker 1: Joe Biden? You know? Yeah, Uncle Joe. I mean, empathy
Speaker 1: is his strength. And uh and and yet I think
Speaker 1: he's been disconnected from the economic population since this administration started. Um,
Speaker 1: he's great on natural disasters, which I hate to say that,
Speaker 1: but he's responded well to them. But but on these
Speaker 1: economic issues, he's just he's just seems to be forgetting
Speaker 1: that people are impacted by this. It first started, you know,
Speaker 1: when he would ignore inflation, and now he's kind of
Speaker 1: throwing recession out there is as some thing that's going
Speaker 1: to happen no matter what the administration does. Genie, as
Speaker 1: you consider the messaging around this this g d P report,
Speaker 1: does the White House need to prepare people for more
Speaker 1: bad news this current quarter? They seem to be going
Speaker 1: out of their way to talk about the upside on this,
Speaker 1: and Ed Mills did too. I mean, look, consumers are
Speaker 1: still spending that there are are still real signs of
Speaker 1: strength in our economy, despite what the markets have been
Speaker 1: doing lately and despite the impact of this war. Yeah,
Speaker 1: and I think you can do both. I think surrogates
Speaker 1: can certainly say, here's the flip side of this, look
Speaker 1: at there are positive signs. This isn't the whole story.
Speaker 1: That's fine to say. At the same time, they have
Speaker 1: to do both. They have to say, we know why.
Speaker 1: The latest Gallop Show poll showed four and five people
Speaker 1: rate the current economic conditions as fair or poor. Those
Speaker 1: are big, big numbers. So yeah, say what's positive? Say
Speaker 1: why you got to look beyond the headlines, but acknowledge
Speaker 1: the pain people are feeling and tell them how you're
Speaker 1: going to make it better. That's what they've got to
Speaker 1: do with just a few months before the midterm. Well
Speaker 1: how can you make it better? Rick? When if if
Speaker 1: this is a global story. I asked Gina mc gena
Speaker 1: McCarthy's Gina Romando about this earlier today. If this is
Speaker 1: supply chain and COVID, that's why we have inflation, that's
Speaker 1: what the administration tells us. Add the war that makes
Speaker 1: it worse. Do we run the risk of causing a recession? Rick?
Speaker 1: Or how how likely is it that the FED causes
Speaker 1: one with interest great hikes when this is this is
Speaker 1: a recession or an inflation that's being prompted by different
Speaker 1: factors than they have really ever dealt with. That's right.
Speaker 1: And and we knew going into this cycle that it
Speaker 1: was going to be the fight at the FED between
Speaker 1: the guys on growth and the guys on fighting an inflation.
Speaker 1: And and look, I mean the chairman's a growth guy.
Speaker 1: I mean, so you've got the right people at at
Speaker 1: the at the helm uh And but you're right, it
Speaker 1: is a It is a global story, and part of
Speaker 1: it is this lockdown in China. I mean, like you've
Speaker 1: talked about, oh macrown and how that impacted us in
Speaker 1: the first quarter of the war in a craze this quarter. Um.
Speaker 1: But but there's been a tremendous impact of the global
Speaker 1: economy by a self inflicted severe lockdown in China that
Speaker 1: is definitely going to affect the supply chain that has
Speaker 1: been so difficult for us. So, Um. The fact that
Speaker 1: the country's weather the storm as well as it has
Speaker 1: is actually remarkable. It does little for the policy makers
Speaker 1: to say that. But frankly, I'm sure the feed is
Speaker 1: looking this and looking at these numbers saying, wow, this
Speaker 1: is great. We've still got growth um and I think
Speaker 1: they will manage uh, they're part of the portfolio to
Speaker 1: ensure that that growth continues. Well, the question, I guess is,
Speaker 1: what is that growth still going to be evident after
Speaker 1: a half point next week basis points apparently the meeting
Speaker 1: after that, Genie, I mean this, this will at some
Speaker 1: point have heavy impacts. I'm assuming on consumer spending. It's
Speaker 1: got to work its way through the economy. And boy,
Speaker 1: I don't know, does that happen right around November? You know,
Speaker 1: the worst timing, And that's what we keep hearing. You know,
Speaker 1: the recession is not imminent, but look, you know a
Speaker 1: few months from hours, people are saying one year from now.
Speaker 1: And even to have the President out there today, you know,
Speaker 1: while he's you know, saying he's going to ask Congress
Speaker 1: for thirty three billion dollars for Ukraine, he's answering questions
Speaker 1: which get him into talking about a recession potentially. I mean,
Speaker 1: the juxtaposition of those two things is really problematic for
Speaker 1: this White House. The money is needed for Ukraine, but
Speaker 1: you can bet people are going to start to ask questions.
Speaker 1: This is a lot of money when the President is
Speaker 1: at the same time talking about a recession next year.
Speaker 1: Rick and Jeanie still with us ahead as Joe Mansion
Speaker 1: swoops back in just in time to save the day.
Speaker 1: We'll check markets on the way. This is Bloomberg. You're
Speaker 1: listening to Bloomberg. You sound on with Joe Matthew on
Speaker 1: Bloomberg Radio. Welcoming back the gentleman from West Virginia to
Speaker 1: the conversation. Joe Mansions making news again. I was just
Speaker 1: reading he's on the outs with the White House. They
Speaker 1: didn't want to bother each other after the whole build
Speaker 1: back Better fell apart. Now he's got a plan and
Speaker 1: it's bipartisan. He says, to avoid the use of reconciliation,
Speaker 1: even though it's likely Democrats will do that at some
Speaker 1: point this year. As we discussed earlier this hour with
Speaker 1: Ed Mills at Raymond James, there are opportunities and you
Speaker 1: don't just walk away from them in politics. But Joe
Speaker 1: Mansion has an idea here that you get a couple
Speaker 1: of Republicans on board, you call it bipartisan. You don't
Speaker 1: have to use reconciliation, and it's narrow energy and climate.
Speaker 1: And he's got some people listening here talking about a
Speaker 1: new look at leases for drilling and more broadly, helping
Speaker 1: to bridge the gap between the world we're in now
Speaker 1: burning fossil fuels and a world will eventually be in
Speaker 1: with renewables, but doing it in a way that doesn't
Speaker 1: cause well hundred dollar a barrel oil for the whole duration.
Speaker 1: Here's Senator Mansion today. We need a two path system. Okay.
Speaker 1: You have to have being the climate and you have
Speaker 1: to have the reliability of the fossil. Those two go
Speaker 1: across sometime, could be five years, could be ten years
Speaker 1: or whatever. You can't eliminate one before the other. If not,
Speaker 1: you end up like Germany, you end up like Europe.
Speaker 1: Problem there. What is it going anywhere? And can you
Speaker 1: get enough Republicans and holds enough Democrats to make this happen?
Speaker 1: I wonder what the White House thinks about it. As
Speaker 1: we reassemble the panel, Rick and Janie are here Bloomberg
Speaker 1: Politics contributors Rick Davis, Genie Chanzano. Is this the kind
Speaker 1: of thing that at the White House they're all getting
Speaker 1: another desks right now, Genie? Or is it good news
Speaker 1: that they can work together again. You think it would
Speaker 1: be good news, But I think so many people at
Speaker 1: the White House, and so many Democrats quite frankly, feel
Speaker 1: frustrated by their dealings with Joe Manchin that they aren't
Speaker 1: willing to go there. I mean, you look at the
Speaker 1: latest that just Bernie Sanders, and again unlikely he would
Speaker 1: have gone there anyways. But but what he has to say,
Speaker 1: you know, talking about you know, sort of um, the
Speaker 1: the idea that he felt torpedoed and the idea that
Speaker 1: this is no way to behave as a colleague, that
Speaker 1: this was arrogant of mansion and cinema. You know, those
Speaker 1: are the kind of words, you know, burned is what
Speaker 1: you're hearing. So, you know, I do think it's a
Speaker 1: long shot to think you could get something done. I mean,
Speaker 1: do I think they should. Absolutely, they should take what
Speaker 1: they can get and go forward. That means Mansion and
Speaker 1: Cinema have to be on board. But but it doesn't
Speaker 1: seem at least that they have the will to do
Speaker 1: that in the next few weeks. Rick, are you rolling
Speaker 1: your eyes or is this actually the kind of development
Speaker 1: that you're looking for to get Congress working again. Yeah,
Speaker 1: I was kind of expecting a couple of things. One
Speaker 1: mansion has been against so many things. You knew he
Speaker 1: was going to come up with something to before, right,
Speaker 1: you can't you can't be doctor No in the Senate forever.
Speaker 1: And so I'm sure he sees this moment where the
Speaker 1: Biden administration, always a foe of fossil fuels, has now
Speaker 1: had to go out to the industry and say give
Speaker 1: me more, give me more. We're desperate, and and so
Speaker 1: you know, I think he wants to try to embed
Speaker 1: that into something that he can bring Democrats along with
Speaker 1: by pairing it with with climate. And and this administration
Speaker 1: has done very little with climate so far. So he's
Speaker 1: kind of hitting the seam. It's not gonna last forever.
Speaker 1: A lot of it is tied to these global events
Speaker 1: in the Ukraine and Russia. But um, I think it
Speaker 1: was smart on his part at least have something out
Speaker 1: there where people could react to him rather than him
Speaker 1: reacting to this administration. Certainly good for him. Uh. Does
Speaker 1: the White House have to make a choice, though, Rick,
Speaker 1: between this and using reconciliation to do really some pretty
Speaker 1: similar things. No, they don't have to trade anything. Um,
Speaker 1: they should, they should have the the attitude let a
Speaker 1: thousand flowers bloom, right, I mean, like we've got ideas,
Speaker 1: you've got ideas. Let's see what gets sticky. Um. They
Speaker 1: right now that their number one thing isn't you know,
Speaker 1: like we're talking earlier inflation and and and getting that
Speaker 1: under control. That's what's the political uh requirement. But all
Speaker 1: these other issues, domestic issues, healthcare, all the things that
Speaker 1: this administration promised, they should they should be encouraging every
Speaker 1: member to come up with ideas, either through reconciliation or
Speaker 1: through regular order. Life Mansion is talking about as a
Speaker 1: lot of progressives, Genie want to see this president use
Speaker 1: executive action more to get this stuff done, Like don't
Speaker 1: even pick up the phone, just write the document, you know,
Speaker 1: by yourself as sharpie like the last guy, and make
Speaker 1: it happen already. Yeah, and and this is what we've
Speaker 1: seen politically in the modern era. The problem is, of course,
Speaker 1: that the executive actions are more limited, and they're more
Speaker 1: easily overturned, both in the courts and also if Joe
Speaker 1: Biden isn't president in you know, or whoever comes in,
Speaker 1: they're easy to overturn. You're far better off moving this
Speaker 1: through regular legislation and you know, I think one thing
Speaker 1: that Joe Mansion could get on board with and and
Speaker 1: and move forward with, and certainly the White House could
Speaker 1: is to talk about moving on the l n G
Speaker 1: plants in terms of something like security. You know, this
Speaker 1: is something they need to do as we look at
Speaker 1: what was happening in Poland and Bulgaria the other day,
Speaker 1: potentially Germany and Italy, those are permitted already. If the
Speaker 1: President could fast track some of those, they could get
Speaker 1: certainly a lot of bipartisan support on something like that.
Speaker 1: It would be skinny, It would be a skinny energy package,
Speaker 1: but it would be something to hang their hat on
Speaker 1: and it would be a positive in terms of the economy.
Speaker 1: I haven't had a chance to ask you both about
Speaker 1: the Ukraine request. Is that thirty three billion uh go
Speaker 1: through with a with an easy clean vote, Rick or
Speaker 1: is there going to be a lot of stuff attached
Speaker 1: to it. We're hearing about COVID funding, We're hearing about
Speaker 1: Title forty two funding. We're hearing about a lot of
Speaker 1: things right now. Yeah. Well, that Title forty two is
Speaker 1: part of the executive actions that the Biden administration is
Speaker 1: taking that the progressives wanted and ered a disaster with
Speaker 1: the public, So be careful what you asked for. Um.
Speaker 1: This thirty three billion should go through literally before the
Speaker 1: end of this week, if it's not tied to COVID
Speaker 1: funding or any of these other issues. Uh. If Schumer's smart,
Speaker 1: he declares a win, gets this money moving, and controls
Speaker 1: his caucus to not try to attach these additional COVID
Speaker 1: funds uh. And and he can get something done really quick,
Speaker 1: and the President will look like he's got good leadership,
Speaker 1: and it will give us Lensky a win, and it
Speaker 1: will drive the Russians crazy. And of course that's what
Speaker 1: we love to do, is drive the Russians crimy to
Speaker 1: watch it pass without a blink of an eye. Here,
Speaker 1: but Genie, this might be their only opportunity to get
Speaker 1: that money. I mean you you do have some Republicans involved. Well,
Speaker 1: I guess by the one by the name of Mitt Romney,
Speaker 1: you helped to craft that deal to get at least
Speaker 1: half the money that the White House is asking for
Speaker 1: for COVID. Yeah, you know, but you know you're talking
Speaker 1: about the terms clean and the US Congress out of
Speaker 1: my mind. I don't mean to make you laugh. This
Speaker 1: is the comedy portion of the broadcast. You're you're very optimistic,
Speaker 1: and you know, God willing it would go through. We
Speaker 1: heard you know that, We know that the President is saying,
Speaker 1: you know, put it through, you know, by itself in
Speaker 1: a clean way, as you say, um. But I can
Speaker 1: bet that they are going to try to attach a
Speaker 1: lot to it and it is going. You know, anybody
Speaker 1: who thinks this thing is going to get through in
Speaker 1: a week, I hope it does. But that is an
Speaker 1: uphill battle in this Congress. People are going to be
Speaker 1: adding a lot to it, and it's a big ask.
Speaker 1: It's double what has been asked before it's needed. But
Speaker 1: there's going to be things at it in there. We
Speaker 1: spent some time earlier talking about the Mansion on the Hill,
Speaker 1: and I've got to ask you guys about this story
Speaker 1: once again. Another take on the potential the possibility of
Speaker 1: Joe Mansion switching parties. This one comes from the duo
Speaker 1: that wrote the book of the two New York Times
Speaker 1: reporters wrote the book that that exposed the tape with
Speaker 1: Kevin McCarthy, Jonathan Martin Alexander Burns. Apparently, at least this
Speaker 1: is their reporting. Uh, Joe Mansion told John Thune that
Speaker 1: that he would in fact consider switching parties if Thune
Speaker 1: became majority leader. Today he shot that down. Here's what
Speaker 1: Joe Mansion said. These are all my friends on both
Speaker 1: sides of the John Thune is a most decent human
Speaker 1: being and a good friend of mine. But no, they
Speaker 1: know where I'm at. And Ms McConnell as He's tried
Speaker 1: everything him I possible. At the bottom line is I
Speaker 1: am West Virginia Democrat. I'm not a Washington Democrat. Genie,
Speaker 1: What does that mean? What's the difference between a West
Speaker 1: Virginia Democrat and a Washington Democrat? You know? And Joe Mansions?
Speaker 1: You know, world, it is somebody who sticks to their
Speaker 1: guns despite being sort of ostracized from much of the
Speaker 1: energy of the party on the left. But of course,
Speaker 1: you know, why would Joe Mansion at this point switch.
Speaker 1: He's got all the power, He's the person everybody is
Speaker 1: talking about. It would be, you know, the height of
Speaker 1: insanity to switch now. Maybe another time, but right now
Speaker 1: he's got Washington in the palm of his hand, is
Speaker 1: Genie right on that one? Rick? And as a Republican,
Speaker 1: would you love to see him maybe just step over
Speaker 1: a little bit closer. Yeah, Look, I'd love him to
Speaker 1: be a Republican. A West Virginia Democrat is a Republican.
Speaker 1: That's just code. And so, um, I think I think
Speaker 1: that it would be great for him to be here.
Speaker 1: But but that agenda, the McConnell agenda, would be to
Speaker 1: just stop everything that Biden is doing. And I do
Speaker 1: think there's a part of Mansion that wants to get
Speaker 1: something done, and he knows the only way is something
Speaker 1: done is with the full backing of the Democratic leadership
Speaker 1: in the White House. They still have the numbers to
Speaker 1: pass legislation and signed it into law, and the Republicans
Speaker 1: can't give him that. Maybe I should have asked you first,
Speaker 1: is John Thune ever going to be Majority leader? Uh? Sure,
Speaker 1: he decided to run for re election, which was not
Speaker 1: a uh a certainty at the beginning of this year.
Speaker 1: And Mitch McConnell, you know, uh, nobody knows how long
Speaker 1: he'll want to serve as majority leader. But that's that's
Speaker 1: the succession plan. That's the succession plan. What does that
Speaker 1: mean for Chuck Schumer? Genie? You know, Um, Chuck Schumer
Speaker 1: has got to keep the Senate if if he wants
Speaker 1: to be a majority leader. Um and you know, minority leader.
Speaker 1: I mean, does he does he keep the job in
Speaker 1: that instance? You know, I think he likely will. I'm
Speaker 1: not sure. There's a lot of other people that are,
Speaker 1: you know, vying for that right now. But you know,
Speaker 1: it's it's a hard year and I think, you know,
Speaker 1: Chuck Schumer has had a really really difficult time. He's
Speaker 1: had some wins. We got to give him that, the
Speaker 1: you know, first majority leader from New York in history,
Speaker 1: but he's had a tough time in the last year.
Speaker 1: He's got a couple of tough weeks ahead of him
Speaker 1: as well. A great conversation with Rick and Genie. Rick,
Speaker 1: good luck with everything. This weekend, they've got the big
Speaker 1: Sedona Summit kicking off at the McCain Institute. Genie will
Speaker 1: be back with us tomorrow and I'll meet you here
Speaker 1: as well. On the Fastest Hour in Politics. From World
Speaker 1: Headquarters in New York, I'm Joe Matthew. This is Bloomberg