WEBVTT - Inflation slows, a Red Wave wrinkles 0:00:03.800 --> 0:00:07.200 Welcome to Bloomberg Opinion. I'm only this week. The main 0:00:07.240 --> 0:00:10.479 thing Republicans I hope take away from this is that 0:00:10.760 --> 0:00:14.520 opposing democracy is dangerous. Running on a platform without having 0:00:14.560 --> 0:00:17.640 any policies to address the problems that they point out 0:00:17.800 --> 0:00:20.919 is not necessarily a plus with voters, and having a 0:00:20.920 --> 0:00:25.720 bunch of flakes and otherwise unqualified candidates can be harmful. 0:00:25.840 --> 0:00:29.360 Jonathan Bernstein there on the November surprise. It was surprises 0:00:29.400 --> 0:00:31.840 all around this week, though not just at the ballot box, 0:00:32.040 --> 0:00:34.839 but also from inflation data on the markets. Let's get 0:00:34.880 --> 0:00:37.919 straight to all of that with Jonathan Livin. So, Jonathan 0:00:37.960 --> 0:00:41.600 albanign was this week's CPI print that clearly looked pretty good, 0:00:41.640 --> 0:00:44.400 and obviously the market has been looking for some good news. 0:00:44.440 --> 0:00:47.319 We've been plagued by bad reports that were worse than 0:00:47.440 --> 0:00:51.080 expected all year long pretty much. However, I have to 0:00:51.120 --> 0:00:54.480 say that a lot of what happened in this report 0:00:55.160 --> 0:01:00.280 was explainable by a methodological quirk and be the stuff 0:01:00.320 --> 0:01:03.640 from used car prices that many of us have been expecting. 0:01:03.920 --> 0:01:07.040 I'm not sure that it dramatically changes the underlying signal 0:01:07.080 --> 0:01:10.440 for the Federal Reserve. Exactly is the market overreacting. I mean, 0:01:10.480 --> 0:01:12.600 it's one thing for equities, but you're not saying bonds 0:01:12.640 --> 0:01:16.119 react to quite the same extent. Yeah, I think that's 0:01:16.160 --> 0:01:19.080 certainly possible. I mean, one place to look for the 0:01:19.160 --> 0:01:23.680 underlying signal is what's going on in core services after 0:01:23.840 --> 0:01:27.959 a shelter and after medical care services. I'll tell you 0:01:28.080 --> 0:01:30.280 a bit about the quirk that's going on in this 0:01:30.440 --> 0:01:35.240 month's data. Effectively, health insurance is measured in a very 0:01:35.440 --> 0:01:39.640 idiosyncratic manner in the Consumer Price Index. The Bureau of 0:01:39.760 --> 0:01:45.800 Labor Statistics essentially back this out from health insurers retained earnings, 0:01:46.040 --> 0:01:49.560 and basically you get a new data dump every twelve months, 0:01:49.920 --> 0:01:53.080 and the Bureau of Labor Statistics ends up extrapolating that 0:01:53.280 --> 0:01:57.560 over the coming twelve months. And for reasons that are 0:01:57.680 --> 0:02:01.760 very sort of technical and idiosyncratic and really have everything 0:02:01.800 --> 0:02:05.720 to do with the strange pandemic economy and very little 0:02:05.760 --> 0:02:10.480 to do with underlying inflation, health insurance inflation went from 0:02:10.600 --> 0:02:14.480 being an insane pressure point on the index to a 0:02:14.520 --> 0:02:17.520 major drag on the index. So what I like to 0:02:17.560 --> 0:02:21.480 do is I strip out some of these idiosyncratic elements. Right, 0:02:21.480 --> 0:02:24.520 So if you just look at core services X shelter, 0:02:24.800 --> 0:02:27.840 which is another weird element in the index, and x 0:02:27.919 --> 0:02:31.480 medical care services, So stripping out that health insurance effect, 0:02:31.720 --> 0:02:36.040 you're still looking at something like a zero point five 0:02:37.000 --> 0:02:41.000 move on the month, which hints at underlying inflation of 0:02:41.080 --> 0:02:44.040 somewhere around six six and a half percent. It's a 0:02:44.080 --> 0:02:46.320 little better, I guess, but we're obviously not out of 0:02:46.360 --> 0:02:48.120 the woods, and the market has started to deprice it 0:02:48.120 --> 0:02:50.359 in a fifty basis point move and then really nothing 0:02:50.440 --> 0:02:54.200 until next March. It seems a bit too optimistic. But 0:02:54.440 --> 0:02:56.959 is the market always right? Yeah? I mean, I think 0:02:57.000 --> 0:03:01.080 what we're really looking at here is a increasing optimism 0:03:01.160 --> 0:03:03.400 that they will down shift to fifty, which is not 0:03:03.480 --> 0:03:06.160 at all surprising. There have been plenty of FED speakers 0:03:06.200 --> 0:03:09.320 who have been hinting that this is coming. No matter what, right, 0:03:09.680 --> 0:03:12.800 the firmware reserve really doesn't want to reach its destination 0:03:12.919 --> 0:03:15.880 point going a hundred miles an hour. It wants to 0:03:15.880 --> 0:03:18.160 be able to look around as it arrives at its 0:03:18.240 --> 0:03:22.959 ultimate destination see if the incoming data confirms that it's 0:03:23.080 --> 0:03:27.160 reaching an appropriate policies stands and be able to adjust accordingly. 0:03:27.480 --> 0:03:30.160 I don't think that that changes that much in terms 0:03:30.160 --> 0:03:33.120 of the ultimate destination and how long the FED probably 0:03:33.200 --> 0:03:35.320 wants to stay there. So if you look at FED 0:03:35.360 --> 0:03:39.040 funds futures, what they're basically telling us, again not insane, 0:03:39.200 --> 0:03:42.440 is that maybe that destination is about twenty five basis 0:03:42.480 --> 0:03:46.960 points lower than we had previously been expecting. Now, what's weird, however, 0:03:47.000 --> 0:03:50.360 as you're alluding to, is you have stocks. You have 0:03:50.400 --> 0:03:54.840 the nasdak in the biggest jump since April on that, 0:03:55.400 --> 0:03:59.120 you know, I think some equity market optimism makes sense, 0:03:59.280 --> 0:04:02.880 but you would envision from a fundamental standpoint, maybe I 0:04:02.960 --> 0:04:04.800 move about half as big as the one that you're 0:04:04.840 --> 0:04:07.920 actually seeing out there. Well, obviously, the other thing this 0:04:07.960 --> 0:04:10.200 week was the mid terms, and while we will have 0:04:10.400 --> 0:04:13.960 divided government, most likely it's kind of a strangely divided 0:04:14.000 --> 0:04:17.360 government at this point. What's more likely stimulus politics or 0:04:17.400 --> 0:04:21.560 inflation slash debt politics. I think what's most likely is 0:04:21.720 --> 0:04:24.560 grid luck and not much gets done. So if you're 0:04:24.560 --> 0:04:27.320 a bit of a politics cynic, maybe you actually see 0:04:27.360 --> 0:04:30.760 that as a good thing. The biggest risk going into 0:04:30.800 --> 0:04:34.480 all of this, I think was arguably that an emboldened 0:04:34.640 --> 0:04:38.880 Republican party might push for some debt ceiling antics and 0:04:38.960 --> 0:04:41.920 we could have some sort of reprise of the volatility 0:04:42.000 --> 0:04:45.920 that we saw in two thousand eleven, where Republicans used 0:04:45.920 --> 0:04:49.400 the debt ceiling as a threat to extract something that 0:04:49.440 --> 0:04:52.480 they want. Of course, in two thousand eleven, an end 0:04:52.480 --> 0:04:55.120 result of all that was the United States ended up 0:04:55.360 --> 0:04:59.040 getting downgraded by Standard and Poors. I don't think that 0:04:59.040 --> 0:05:01.960 that kind of all atility was something that the market 0:05:02.000 --> 0:05:06.640 necessarily needed given all of the headwinds here. So if 0:05:06.680 --> 0:05:10.400 you believe at the margin that maybe the lack of 0:05:10.440 --> 0:05:14.120 a red wave leads to a less emboldened Republican party 0:05:14.279 --> 0:05:18.400 and a lesser likelihood of something like that happened, maybe 0:05:18.560 --> 0:05:21.960 at the margins you could even read this as slightly 0:05:22.040 --> 0:05:24.520 positive and we'll see if that gets done before the 0:05:24.560 --> 0:05:26.440 end of the year. It has been the worst year 0:05:26.440 --> 0:05:28.880 in at least fifty years for the bond market. Do 0:05:28.920 --> 0:05:31.240 you imagine that that statistical improved by the end of 0:05:31.240 --> 0:05:36.320 the year? I intenser around now, aunt it's reasonable to think. So. 0:05:36.440 --> 0:05:40.279 I think a good question is hand bonds actually rally 0:05:40.440 --> 0:05:43.240 from here. It really seems to me that, you know, 0:05:43.279 --> 0:05:46.200 if you believe the feds rhetoric, which I do, that 0:05:46.320 --> 0:05:49.919 they have the short end pinned here. The belly of 0:05:49.960 --> 0:05:52.640 the curve, the ten year tends to be a place 0:05:52.680 --> 0:05:57.680 where traders will express a view of raith coming down. Eventually, 0:05:57.839 --> 0:06:00.480 the ten year part of the curve can definitely rally 0:06:00.560 --> 0:06:03.760 even as the short end stays put. However, you know 0:06:03.839 --> 0:06:07.000 what's interesting is that we know that the FED wants 0:06:07.040 --> 0:06:11.920 to see tighter financial conditions. Chair Jerome Peal mentioned at 0:06:12.080 --> 0:06:14.960 his last press conference last week that he's not just 0:06:15.080 --> 0:06:17.800 paying attention to the short end. He wants to see 0:06:18.240 --> 0:06:22.800 meaningfully positive real rates all throughout the curve. So a 0:06:22.880 --> 0:06:26.599 question that I have is, should that ten year segment 0:06:26.680 --> 0:06:29.760 of the yield curve start to rally in any meaningful way, 0:06:29.880 --> 0:06:33.560 would you then see FED speakers again ratchet up the 0:06:33.680 --> 0:06:38.120 hawkish rhetoric or could we even face the specter of 0:06:38.360 --> 0:06:42.640 the FED selling treasuries from its portfolio just to make 0:06:42.680 --> 0:06:46.919 sure that the curve looks away the FED wants it 0:06:47.000 --> 0:06:50.280 to look Bloomberg Opinions Jonathan live In more next on 0:06:50.320 --> 0:06:53.560 Bloomberg Opinion. I'm Vonnie Quinn. I have to say, Jonathan, 0:06:53.640 --> 0:06:55.440 you call this in a lot of senses when it 0:06:55.440 --> 0:06:58.280 comes to the issues that voters are voting on, for example, 0:06:58.360 --> 0:07:00.800 and you know you said that it's not just I'm done, 0:07:00.839 --> 0:07:02.640 And the only other person I've heard say that is 0:07:02.680 --> 0:07:11.080 Michael Moore recently. Well I'm not all right, So Jonathan, 0:07:11.120 --> 0:07:13.600 we're talking Wednesday afternoon. Nevada and Arizona have yet to 0:07:13.600 --> 0:07:15.760 be called, and it's all but certain that Georgia has 0:07:15.800 --> 0:07:18.920 headed for a special election December six. However, we do 0:07:19.040 --> 0:07:22.320 know a lot, an awful lot about US democracy right now. 0:07:22.880 --> 0:07:25.920 Is it in less trouble than we thought? Yeah? I 0:07:25.960 --> 0:07:29.400 think so, with huge numbers of caveats about that. We're 0:07:29.400 --> 0:07:31.800 not out of the woods, and the threats still real 0:07:32.120 --> 0:07:35.160 and things could change rapidly. But there were a number 0:07:35.200 --> 0:07:39.880 of positive signs after a very bad start that the primaries. 0:07:39.920 --> 0:07:43.600 We had some candidates refusing to concede during their Republican primaries. 0:07:43.640 --> 0:07:48.040 We had efforts to harass election workers all summer in fall. 0:07:48.600 --> 0:07:51.800 We had in the early voting in Arizona a couple 0:07:51.800 --> 0:07:55.400 of these clowns show up in military gear observing drop 0:07:55.440 --> 0:07:59.520 boxes and intimidating voters. But then as elections they came, 0:07:59.760 --> 0:08:03.400 that sort of dropped off and we didn't get stories, 0:08:03.480 --> 0:08:07.400 at least not significantly organized efforts at at voter intimidation 0:08:07.560 --> 0:08:11.720 which was a real fear. We didn't so far as 0:08:11.760 --> 0:08:15.480 we're speaking. This could change any minute. But Republicans who 0:08:15.480 --> 0:08:19.760 have lost have conceded properly, normally, and while there are 0:08:19.840 --> 0:08:24.600 some crazy conspiracies that are circulating, they have not migrated. 0:08:24.640 --> 0:08:27.200 They have not made the important step of migrating into 0:08:27.760 --> 0:08:31.240 the mouths of politicians and for the most part, too 0:08:31.760 --> 0:08:36.320 high profile Republican align media. So the concessions are interesting. 0:08:37.000 --> 0:08:38.920 As you say, it's sort of back to business as normal, 0:08:39.000 --> 0:08:42.319 the old politics that we knew and loved. Did something 0:08:42.440 --> 0:08:45.360 change within the Republican Party. Did these people get the 0:08:45.400 --> 0:08:48.440 message from leadership that they were to do this? I 0:08:48.440 --> 0:08:51.000 have not seen any reporting on this. Threats to democracy 0:08:51.000 --> 0:08:53.920 didn't start with Donald Trump. They have deep routes in 0:08:53.960 --> 0:08:56.560 the party going back quite some time and having gotten worse. 0:08:56.559 --> 0:08:58.160 And that's one of the reasons we got Trump. But 0:08:58.640 --> 0:09:04.680 Trump himself as an outlier. Trump himself feels completely apparently, 0:09:04.760 --> 0:09:09.760 or at least he does it completely willing to claim 0:09:09.960 --> 0:09:13.079 fraud no matter what. He doesn't need some sort of pretext. 0:09:13.200 --> 0:09:16.320 He proclaimed fraud in every election he was on the ballot. 0:09:16.320 --> 0:09:19.480 Before the election happened, he proclaimed that he was ripped 0:09:19.520 --> 0:09:23.400 off by fraud. After winning the presidency, the one time 0:09:23.400 --> 0:09:26.960 you would think that candidate would want to increase respect 0:09:27.000 --> 0:09:29.600 for elections and confidence in elections, he still said there 0:09:29.640 --> 0:09:31.680 was sons of fraud that he had no evidence for. 0:09:32.240 --> 0:09:35.400 And I think that it turns out that when the 0:09:35.480 --> 0:09:37.920 leader of their party is saying it very loudly, a 0:09:37.920 --> 0:09:41.040 lot of Republicans go along, either because they think the 0:09:41.080 --> 0:09:43.560 incentives are there, that they're better off agreeing with the 0:09:43.640 --> 0:09:47.000 leader of their party, or possibly just because they actually 0:09:47.000 --> 0:09:48.720 believe it. I think a lot of rank and file 0:09:48.960 --> 0:09:51.520 voters and some of the candidates come out of the 0:09:51.600 --> 0:09:54.079 rank and file voter group. You know, they hear a 0:09:54.120 --> 0:09:56.520 Republican president say something, they say here, well, he may 0:09:56.520 --> 0:09:59.280 be exaggerating, but there's got to be something to it, 0:09:59.360 --> 0:10:01.600 or else he wouldn't say it. It turns out Donald 0:10:01.600 --> 0:10:03.080 Trump is willing to say a lot of things just 0:10:03.120 --> 0:10:08.000 because he said them, and that is unusual, obviously very dangerous. 0:10:08.040 --> 0:10:10.280 So that I think helped. I think we got a 0:10:10.320 --> 0:10:13.960 little lucky so far, at least that most of the 0:10:14.120 --> 0:10:18.800 losers lost by a substantial amount. Again, if that was 0:10:18.880 --> 0:10:22.160 trumpet wouldn't stop them from claiming fraud. But you know, 0:10:22.480 --> 0:10:25.160 normal people if they lose an election by eight, ten, 0:10:25.320 --> 0:10:29.680 fifteen percentage points, they see what's going on, I mean lucky. 0:10:29.720 --> 0:10:31.720 But also more people registered and so on. And it 0:10:31.800 --> 0:10:35.640 was a different election, in fact, a very very different election, 0:10:35.760 --> 0:10:39.000 one of the kind. Speaking of Trump, dr ols did terribly. 0:10:39.200 --> 0:10:41.800 It took more money than expected to win. In Ohio, 0:10:42.600 --> 0:10:46.120 governors that had not had Trump's backing, like Camp and 0:10:46.240 --> 0:10:49.560 the Wine, they won fine without Trump. Carry Lake is 0:10:49.559 --> 0:10:52.560 in trouble in Arizona in the governor's race. What position 0:10:52.679 --> 0:10:56.280 does this all leave Trump in? You know, it's very 0:10:56.280 --> 0:11:00.319 hard to tell, because there have been other moments where 0:11:00.679 --> 0:11:02.400 it was clear that Trump was a drag on the 0:11:02.440 --> 0:11:05.160 party and that his judgment is terrible. You know, he 0:11:05.280 --> 0:11:08.840 endorsed these candidates who were terrible candidates, and he's not 0:11:08.880 --> 0:11:11.079 good at this kind of stuff. Now it doesn't bother him. 0:11:11.200 --> 0:11:14.800 Apparently he was today blaming his wife for his endorsement 0:11:14.920 --> 0:11:21.560 of doctor Oz. You know, Donald Trump is, of course, 0:11:21.559 --> 0:11:25.600 the only president we've ever had who repeatedly criticized extreme 0:11:25.640 --> 0:11:30.280 criticisms of his own cabinet nominees. People he put in 0:11:30.320 --> 0:11:32.960 his own cabinet turned out to be horrible, horrible people 0:11:33.400 --> 0:11:35.880 and he never took any responsibility for that. So we've 0:11:35.880 --> 0:11:40.720 had these points before, and Republican politicians and other party 0:11:40.760 --> 0:11:44.320 actors and the Republican aligned media have not made the 0:11:44.360 --> 0:11:48.440 decision to cut him off. And perhaps because they really 0:11:48.640 --> 0:11:52.240 don't believe that he's arming them, or perhaps because of 0:11:52.320 --> 0:11:56.600 other reasons. I think the Republican aligned media has ratings incentives. 0:11:56.640 --> 0:11:58.160 He sells a lot of books, he sells a lot 0:11:58.160 --> 0:12:01.480 of ads, and increases ratings. So there's that. And I 0:12:01.480 --> 0:12:03.560 think a lot of candidates are just afraid that he 0:12:03.600 --> 0:12:07.280 will go after them, even though the evidence isn't really 0:12:07.280 --> 0:12:09.920 there that he's that much of a threat. But politicians 0:12:09.920 --> 0:12:11.800 tend to be paranoid about that sort of thing. We'll 0:12:11.840 --> 0:12:14.400 come back to Trump in a moment. But what kind 0:12:14.440 --> 0:12:17.560 of lessons should Republicans learn from this election, given that 0:12:17.600 --> 0:12:19.760 they really didn't do as well as expected, particularly in 0:12:19.880 --> 0:12:22.400 places like in the Midwest, and it may mean that 0:12:22.520 --> 0:12:26.040 a sweep in is off the table, for example, mail 0:12:26.120 --> 0:12:29.480 in voting, should they embrace it? I do think that Republicans, 0:12:29.720 --> 0:12:33.720 by demonizing mail and voting, are making it more difficult 0:12:33.760 --> 0:12:35.880 for their own voters. I don't know that there have 0:12:35.920 --> 0:12:39.400 been any careful studies that actually show that it makes 0:12:39.400 --> 0:12:42.120 a difference. So that's something I know. I don't think 0:12:42.160 --> 0:12:45.120 this tells us anything about two years is a huge 0:12:45.200 --> 0:12:48.560 long time, and there's basically no correlation between what happens 0:12:48.559 --> 0:12:51.360 in mid terms and what happens in the next presidential election. 0:12:51.760 --> 0:12:55.079 But I think the main thing Republicans I hope take 0:12:55.120 --> 0:12:59.280 away from this is that opposing democracy is dangerous, that 0:12:59.400 --> 0:13:02.960 running on a platform without having any policies to address 0:13:03.040 --> 0:13:05.680 the problems that they point out is not necessarily a 0:13:05.720 --> 0:13:09.080 plus with voters, and that having a bunch of flakes 0:13:09.440 --> 0:13:14.920 and otherwise, you know, unqualified candidates can be harmful. Whether 0:13:14.920 --> 0:13:17.840 that's the lesson they empirically should take from what happened, 0:13:18.080 --> 0:13:20.080 I don't know. It takes a long time to study 0:13:20.080 --> 0:13:23.080 exactly why elections came out as they did, and even 0:13:23.120 --> 0:13:25.200 if we had all the votes counted, you still have 0:13:25.320 --> 0:13:27.160 to do a lot of work to actually find the 0:13:27.160 --> 0:13:30.959 cause of relationships. But what parties take away from things 0:13:31.160 --> 0:13:33.959 has very little to do sometimes with reality, and more 0:13:34.040 --> 0:13:38.400 to do with internal interests within the party, internal factions 0:13:38.400 --> 0:13:40.880 within the party, and how they fight to have their 0:13:40.920 --> 0:13:44.880 interpretations of what happened become the leading explanations. So, for example, 0:13:44.960 --> 0:13:48.760 we've already seen anti abortion Republicans organized groups of anti 0:13:48.800 --> 0:13:52.120 abortion Republicans say that the reason that Republicans lost is 0:13:52.160 --> 0:13:55.079 because they did from the issue of abortion. Now I 0:13:55.120 --> 0:14:01.040 don't think that's true. Um yeah, I think in fact, 0:14:01.120 --> 0:14:03.920 abortion cost them badly and the candidates shied away from 0:14:03.960 --> 0:14:06.640 it because they knew that it was costing them. But 0:14:06.760 --> 0:14:09.120 you know, they're going to try to float that and 0:14:09.440 --> 0:14:11.960 they may be successful. It's a powerful issue within the 0:14:12.000 --> 0:14:15.680 party among party voters in primaries. More next on Boomer Opinion. 0:14:15.720 --> 0:14:19.120 I'm Vonnie Quinn. Kevin McCarthy isn't a slam Don christ peaker. 0:14:19.160 --> 0:14:21.160 I mean, he likely get it, but he may have 0:14:21.200 --> 0:14:23.920 to do some negotiation. What kind of negotiations do you 0:14:23.960 --> 0:14:26.120 imagine we'll go on within the Republican Party in order 0:14:26.160 --> 0:14:29.480 to have them? Well, we don't, even though as I 0:14:29.520 --> 0:14:32.000 speak that Republicans definitely have the majority. I believe they 0:14:32.040 --> 0:14:34.560 will have the majority. I believe that the whole time. 0:14:35.000 --> 0:14:37.600 You just don't avoid a seat loss when you're a 0:14:37.680 --> 0:14:40.560 president's party. So assume that he gets a majority, but 0:14:40.560 --> 0:14:44.960 it's a slim majority. There's two steps right first, and 0:14:45.040 --> 0:14:47.680 this will come up next week on Monday and Tuesday, 0:14:48.040 --> 0:14:52.200 Republicans going to vote on who they're speaker candidate should be. 0:14:52.400 --> 0:14:54.560 So in order to do that, he has to win 0:14:55.120 --> 0:14:59.560 a majority of the House Republicans. But then he has 0:14:59.600 --> 0:15:02.920 to when on opening day of the new Congress January three, 0:15:03.200 --> 0:15:05.120 he's going to have to win a majority of the House. 0:15:05.560 --> 0:15:09.240 And if he has, say, if Republicans have a four 0:15:09.360 --> 0:15:12.560 or five or six seat margin, he has to hold 0:15:12.800 --> 0:15:16.120 all of the Republicans. In the old days, that was easy. 0:15:16.160 --> 0:15:19.000 It was an automatic vote. Everybody knew that you voted 0:15:19.040 --> 0:15:23.000 for your party's candidate for speaker. In recent years and 0:15:23.040 --> 0:15:29.440 among the among the House Freedom Caucus types, so you know, um, 0:15:29.680 --> 0:15:33.560 you those are not automatic votes. And the problem is 0:15:33.600 --> 0:15:36.280 that we also have with Democrats with I'm sorry, with 0:15:36.360 --> 0:15:40.680 Republicans picking up several seats in New York for example. Um, 0:15:40.720 --> 0:15:44.440 we have some Republicans who may be not eager to 0:15:44.640 --> 0:15:48.480 have a more extreme speaker, and so there's always a 0:15:48.520 --> 0:15:53.000 possibility will have chaos. The thing is that we've already 0:15:53.040 --> 0:15:56.320 had some of the extremists in the House Republican conference 0:15:56.360 --> 0:15:58.840 come out and say, I hope we have a narrow margin. 0:15:58.920 --> 0:16:01.480 Then I'll have more leverage. Well, the truth is that 0:16:01.640 --> 0:16:04.160 in real life, you don't have much leverage if you're 0:16:04.640 --> 0:16:07.080 on the extreme of your party. But they've been able 0:16:07.120 --> 0:16:09.080 to get away with that partially because the rest of 0:16:09.120 --> 0:16:11.520 the party lets them. We don't know whether they'll be 0:16:11.560 --> 0:16:13.480 able to get away with that in the next converse, 0:16:13.520 --> 0:16:15.440 and they may it if they do. If we have 0:16:15.520 --> 0:16:19.000 a slim Republican majority that's bossed by the thirty or 0:16:19.040 --> 0:16:23.760 forty or fifty or sixty most extreme members, it's kind 0:16:23.760 --> 0:16:26.880 of be a mess. Deinitely have to give up certain things, 0:16:26.920 --> 0:16:29.640 but I guess we may never know what they may be. Yeah, 0:16:29.680 --> 0:16:32.000 I mean, it's it's not really clear what he can 0:16:32.080 --> 0:16:35.520 promise or what, you know, what the demands are going 0:16:35.560 --> 0:16:38.160 to be, because a lot of these people are not 0:16:38.480 --> 0:16:43.400 calculating policy interested politicians. These are people whose main goal 0:16:43.640 --> 0:16:46.520 is to have grievances and and you know, and go 0:16:46.560 --> 0:16:49.600 on Fox News or you know, the radio talk shows 0:16:49.680 --> 0:16:54.160 or the more extreme networks and complain about things, including 0:16:54.640 --> 0:16:57.560 the leadership of the Republican Party. So I'm not sure 0:16:58.120 --> 0:17:02.160 what he can give some of the extremist members, because 0:17:02.160 --> 0:17:04.080 they're not interesting. You can't say, oh, yes, I'll give 0:17:04.080 --> 0:17:05.760 you a vote on this bill that you care about, 0:17:06.280 --> 0:17:08.800 because that's not what their thing is, that's not what 0:17:08.840 --> 0:17:11.920 they're interested in. And that's why the Republican Party is 0:17:12.160 --> 0:17:15.359 not very equipped to run the House. Well, speaking of 0:17:15.600 --> 0:17:18.560 members and senators that have had power over the last 0:17:18.600 --> 0:17:20.560 couple of years, does Joe managine have as much power 0:17:20.600 --> 0:17:24.639 as he had going forward? Um, you know, assuming that 0:17:24.760 --> 0:17:28.560 Democrats have a majority in the Senate, whether it's fifty 0:17:28.600 --> 0:17:30.880 or fifty one seats or even fifty two as possible 0:17:30.960 --> 0:17:34.280 right now, I think get the math in my head. Um, 0:17:34.600 --> 0:17:37.280 The thing is, if there's a Republican majority in the House, 0:17:37.440 --> 0:17:41.480 then know, anything that passes and becomes law is going 0:17:41.520 --> 0:17:45.320 to need a supermajority to get there, because you're going 0:17:45.359 --> 0:17:47.479 to have to have both Republicans and Democrats, because it's 0:17:47.480 --> 0:17:49.360 gonna have if anything that becomes law has to get 0:17:49.359 --> 0:17:51.000 through the republic, if it has to get through a 0:17:51.000 --> 0:17:53.600 Republican House, it's going to have to get Republican votes 0:17:53.600 --> 0:17:55.600 in the Senate. It's also gonna have to get Democratic 0:17:55.640 --> 0:17:59.400 votes in the Senate. So, you know, the same way 0:17:59.440 --> 0:18:02.160 that the Philip Uster kept him from being the swing 0:18:02.240 --> 0:18:06.600 vote on a lot of things. Um, of divided government 0:18:06.600 --> 0:18:08.639 will keep him from being the swing vote on a 0:18:08.640 --> 0:18:12.280 lot of things. That's well, his energy permitting bill then 0:18:12.440 --> 0:18:16.119 is in trouble. Well, that said some of the things 0:18:16.200 --> 0:18:20.960 that if he is an aggressive legislator, it's very possible 0:18:21.000 --> 0:18:24.359 that he could put together coalitions that are bipartisan coalitions 0:18:24.400 --> 0:18:27.120 on some things. We just don't know what has any 0:18:27.160 --> 0:18:29.359 chance to get through the House or representatives. Is the 0:18:29.400 --> 0:18:32.399 thing that's that's fascinating. The climate change was up there 0:18:32.440 --> 0:18:38.480 in terms of voter priorities. You know. I my general 0:18:38.960 --> 0:18:41.680 feeling all this stuff is to wait and look more 0:18:41.760 --> 0:18:44.640 carefully as more studies go out. You know, it's it's 0:18:44.680 --> 0:18:47.480 easy for voters to say stuff. Whether that means that 0:18:47.640 --> 0:18:50.320 and and it's it's interesting what's you know, what they 0:18:50.320 --> 0:18:52.440 tell posters is on the top of their minds. Whether 0:18:52.480 --> 0:18:55.320 that actually moved their votes or not is a much 0:18:55.320 --> 0:18:58.919 more complicated question and sometimes difficult to study. But you know, 0:18:59.000 --> 0:19:02.880 I think that general the polling over the years has 0:19:03.000 --> 0:19:07.960 shown that dealing with climate has been a popular position 0:19:08.080 --> 0:19:10.880 for the last at least decade. And I think one 0:19:10.880 --> 0:19:12.840 of the things that we get out of one of 0:19:12.840 --> 0:19:15.320 the ways to think about the election is that Republicans 0:19:15.320 --> 0:19:20.200 were very, very certain that their issues were wildly popular 0:19:20.240 --> 0:19:23.560 with voters, But it may be that they were wrong. Jonathan, 0:19:23.600 --> 0:19:27.520 candidate quality, particularly for Republicans. How big of an issue 0:19:27.520 --> 0:19:30.320 will it be? Will the more extreme candidates be dismissed 0:19:30.320 --> 0:19:33.200 now more quickly, or should we expect to see more 0:19:33.600 --> 0:19:37.159 fringe candidates and maybe not so fringe candidates, maga candidates 0:19:37.280 --> 0:19:42.880 running in primaries against other Republicans. You know, it's certainly 0:19:42.920 --> 0:19:45.160 true in the media aftermath that one of the things 0:19:45.200 --> 0:19:49.920 they're fixating on is candidate quality. Now, the question becomes, 0:19:50.280 --> 0:19:54.919 can you be a party of anti democratic conspiracy thinking 0:19:55.600 --> 0:19:59.680 and recruit decent candidates? So they didn't just by coincidence, 0:19:59.680 --> 0:20:01.399 have a unto lousy candidates. They had a bunch of 0:20:01.440 --> 0:20:04.040 lot of the candidates in part because their voters wanted 0:20:04.080 --> 0:20:07.520 to hear crazy conspiracy thinking, and in part because solid 0:20:07.880 --> 0:20:11.800 regular politicians weren't willing to run in Republican primaries because 0:20:11.840 --> 0:20:14.720 they didn't want to be beat up for saying things like, oh, yes, 0:20:14.800 --> 0:20:20.960 Joe Biden won the election. Yeah. So, you know, the 0:20:21.000 --> 0:20:23.000 thing is, it's it's easy to say, oh, we had 0:20:23.000 --> 0:20:25.440 a bunch of bad candidates, but the bad candidates weren't 0:20:25.440 --> 0:20:27.760 just a coincidence that happened to happen or that was 0:20:28.080 --> 0:20:31.360 It's not just about Donald Trump's bad judgment in endorsements. 0:20:31.680 --> 0:20:35.159 It's also about what the party is right now, and 0:20:35.760 --> 0:20:39.280 they have some deep problems, and the last of the 0:20:39.280 --> 0:20:42.879 first hours after the election, it could be worse in 0:20:42.960 --> 0:20:45.480 terms of what their reaction is, but we still have 0:20:45.560 --> 0:20:47.560 to see what it's going to be like. One of 0:20:47.600 --> 0:20:49.760 the things we've been speaking about over the last several 0:20:49.800 --> 0:20:51.919 weeks and months, Jonathan, is this idea that there will 0:20:51.960 --> 0:20:54.640 be a lot of investigations in a scenario where there's 0:20:54.640 --> 0:20:57.680 a Republican House majority. Now there is one, or there's 0:20:57.840 --> 0:21:00.720 very likely to be one, not as far the majority though, 0:21:00.760 --> 0:21:03.080 as we thought. Does that mean that some of these 0:21:03.119 --> 0:21:06.159 investigations will get forgotten about. I don't think so. I 0:21:06.200 --> 0:21:09.840 think my guess is that any kind of modesty about 0:21:09.840 --> 0:21:13.200 what happened will disappear very very rapidly in long House 0:21:13.240 --> 0:21:16.760 Republicans and as long as they have a majority, they're 0:21:16.800 --> 0:21:19.840 going to do what they would do if they had 0:21:19.840 --> 0:21:23.160 a fifty or seventy seat majority. Um, they may have 0:21:23.200 --> 0:21:26.639 some limitations in terms of what they could do on 0:21:26.720 --> 0:21:29.879 the House floor. In terms of impeachments, say they have 0:21:29.920 --> 0:21:32.400 a four seed margin, they may not be able to 0:21:33.000 --> 0:21:36.680 do a whole bunch of impeachments that have no basis 0:21:36.720 --> 0:21:40.520 in fact um, whereas if they had a sixty seed 0:21:40.600 --> 0:21:44.000 majority they probably could. Of course, those impeachments would go 0:21:44.080 --> 0:21:47.480 nowhere in the Senate because Democrats are you know, even 0:21:47.480 --> 0:21:50.040 if Democrats don't have a majority, they certainly will have 0:21:50.119 --> 0:21:54.440 enough votes to block conviction. But in terms of committee hearings, 0:21:54.440 --> 0:21:56.840 as long as Republicans have a majority, they will organize 0:21:56.880 --> 0:22:00.320 the committees, and they will fund the committees, and they 0:22:00.359 --> 0:22:04.800 will support investigations. And given who the people are who 0:22:04.840 --> 0:22:08.000 would possibly be chair of those committees, they're not going 0:22:08.080 --> 0:22:12.840 to be you know, sober investigations of you know, real 0:22:12.880 --> 0:22:17.680 wrongdoing or policy oriented. They're going to be going after 0:22:18.280 --> 0:22:22.119 whatever craziness that the Republican online media tells them to 0:22:22.160 --> 0:22:24.800 go after. I have to ask you about the special election. 0:22:25.040 --> 0:22:27.560 We know how much is at stake in this election. 0:22:28.920 --> 0:22:32.399 Thank you for being with me, and I'm grateful that 0:22:32.440 --> 0:22:34.840 we are together every step of the way. I wanted 0:22:34.840 --> 0:22:36.960 to thank you guys for hanging in And if you 0:22:37.000 --> 0:22:39.000