WEBVTT - Analysis of US CPI and Trump's Cabinet Appointees 0:00:02.400 --> 0:00:06.760 Bloomberg Audio Studios, podcasts, radio news. 0:00:11.920 --> 0:00:16.320 This is the Bloomberg Surveillance Podcast. Catch us live weekdays 0:00:16.360 --> 0:00:19.640 at seven am Eastern on Apple Car Player, Android Auto 0:00:19.760 --> 0:00:23.080 with the Bloomberg Business App. Listen on demand wherever you 0:00:23.120 --> 0:00:26.200 get your podcasts, or watch us live on YouTube. 0:00:26.560 --> 0:00:31.000 Right now your most important conversation of the day. Richard Hass, 0:00:31.040 --> 0:00:35.120 Ambassador has serving both parties. Ambassador Hass, of course always 0:00:35.120 --> 0:00:39.040 in forever associated with his Consolin Foreign Relations and Writing 0:00:39.080 --> 0:00:42.160 and Foreign Affairs at magazine. He holds court with Morning 0:00:42.280 --> 0:00:46.840 Joe on an often basis. Rattner's charts on Morning Joe 0:00:46.880 --> 0:00:50.199 had been great. They've been like a font of wisdom. 0:00:50.560 --> 0:00:51.360 He works at. 0:00:51.240 --> 0:00:53.640 It, he works at it. They're also a font of 0:00:53.920 --> 0:00:56.760 accurate information. And the fact that it stands out is 0:00:56.800 --> 0:00:57.560 stand it depressing. 0:00:58.000 --> 0:01:00.440 This is I can't say thank you so much for 0:01:00.480 --> 0:01:03.360 attending today. I want to go to Lloyd Austin Foreign 0:01:03.360 --> 0:01:07.360 Affairs Magazine. The price of principle is dwarfed by the 0:01:07.480 --> 0:01:12.200 cost of capitulation in Ukraine. I guess we have a 0:01:12.240 --> 0:01:16.200 new Secretary of Defense and the apparatus around it. Can 0:01:16.360 --> 0:01:20.080 anybody that you see there based on Trump loyalty work 0:01:20.120 --> 0:01:22.000 at the level of a four star general. 0:01:22.920 --> 0:01:25.959 Well, let's just take a step back. When you read 0:01:26.440 --> 0:01:30.360 Secretary of Austin's article, he never quite defines what capitulation 0:01:30.480 --> 0:01:34.320 in Ukraine is, So I was not overwhelmed with the piece. 0:01:34.920 --> 0:01:38.640 Just capitulation in Ukrainian Anything less than Ukraine regaining its 0:01:38.720 --> 0:01:39.800 nineteen ninety one. 0:01:39.680 --> 0:01:41.000 Borders is capitulation. 0:01:41.440 --> 0:01:44.959 If that's the case, we are unavoidably capitulating because there's 0:01:45.040 --> 0:01:48.080 zero chance Ukraine's going to be able to achieve that militarily. 0:01:48.600 --> 0:01:50.320 So we feel, first of all, we got to define 0:01:50.640 --> 0:01:54.040 what's our definition of success there, what's a reasonable outcome? 0:01:54.200 --> 0:01:55.800 And clearly we're going to have to move to the 0:01:55.840 --> 0:01:59.280 negotiating table because we can't get there simply on the battlefield. 0:01:59.360 --> 0:02:02.440 Will Europe join us at the negotiation table? 0:02:02.560 --> 0:02:06.960 How lonely is President elect Trump and get out of Ukraine? 0:02:07.400 --> 0:02:09.720 Well again, I wouldn't necessarily say it's get out of Ukraine. 0:02:09.760 --> 0:02:12.080 At the negotiating table will be Ukraine and Russia. The 0:02:12.200 --> 0:02:16.200 question is what is US and European policy in the background. 0:02:16.440 --> 0:02:19.760 Are we prepared to continue to support Ukraine enough so 0:02:19.800 --> 0:02:23.120 the Russians will see incentive to compromise the Russians have 0:02:23.160 --> 0:02:25.320 to feel the pain of this war. Unless they do, 0:02:25.400 --> 0:02:26.320 they won't compromise. 0:02:26.800 --> 0:02:30.320 So what has changed for Russia and Ukraine in the 0:02:30.400 --> 0:02:34.120 last week with this election. Has anything materially changed? 0:02:34.720 --> 0:02:36.360 It's a good question. I don't have the answer to it. 0:02:36.440 --> 0:02:38.200 I mean, you can see the direction of a lot 0:02:38.200 --> 0:02:40.720 of the appointments on China, and we can talk about that, 0:02:43.360 --> 0:02:46.680 secondarily probably on the Middle East. Less clear on Ukraine 0:02:46.919 --> 0:02:49.680 because if you look at what say Marco Rubio is 0:02:49.760 --> 0:02:51.720 going to be Secretary of State or the new National 0:02:51.800 --> 0:02:56.360 Security Advisor, they have been critical most recently arms support 0:02:56.400 --> 0:02:59.679 for Ukraine, but they're not necessarily let's throw Ukraine under 0:02:59.680 --> 0:03:02.200 the bus. There's a big gray area in between that. 0:03:02.440 --> 0:03:05.560 So I understand why everybody's uneasy. But again, I think 0:03:05.600 --> 0:03:07.480 a lot of it's going to depend upon what sort 0:03:07.480 --> 0:03:11.280 of a negotiated outcome will President elect Trump support when 0:03:11.280 --> 0:03:12.120 he's President Trump. 0:03:13.440 --> 0:03:16.480 How much is in our hands, the US hands versus 0:03:16.840 --> 0:03:19.680 Ukraine and Russia in terms of making the next step 0:03:19.720 --> 0:03:22.880 to maybe getting to a negotiation, Do we have any 0:03:23.040 --> 0:03:25.120 real influence in pushing that forward? 0:03:25.880 --> 0:03:29.760 Absolutely, we need to be sufficiently supportive of Ukraine. So 0:03:29.840 --> 0:03:32.880 Putin begins to question his assumption that times on his 0:03:33.000 --> 0:03:35.200 side he can just wait out the United States on 0:03:35.200 --> 0:03:37.200 the West. On the other hand, we have to be 0:03:37.480 --> 0:03:41.120 sufficiently conditional in our support for Ukraine, so mister Zelenski 0:03:41.440 --> 0:03:45.160 gets more prepared to compromise. So actually we play a 0:03:45.160 --> 0:03:47.360 critical role, not so much at the table, but in 0:03:47.400 --> 0:03:49.080 setting the context for the table. 0:03:49.320 --> 0:03:52.360 All these people that he's selecting now, I'm going to say, 0:03:52.360 --> 0:03:55.400 based just a generalization, one hundred percent have been on 0:03:55.480 --> 0:03:56.520 the outside. 0:03:56.800 --> 0:03:58.040 You have experience in this. 0:03:58.440 --> 0:04:02.320 When you walk through the doors sixteen Pennsylvania Avenue, when 0:04:02.360 --> 0:04:05.080 you walk through the door of the Pentagon, how do 0:04:05.240 --> 0:04:05.880 you change? 0:04:05.920 --> 0:04:08.800 How does your message? How does your thinking change? 0:04:09.360 --> 0:04:11.720 It reminds me a little bit of Mario Cuomos comment 0:04:11.800 --> 0:04:15.160 that you campaign in poetry and you governed in prose. 0:04:15.640 --> 0:04:18.000 When you walk inside the doors, you start governing in 0:04:18.040 --> 0:04:21.240 prose at a level of detail, at a level of implementation. 0:04:21.320 --> 0:04:23.000 When you work on the hill, you can. 0:04:22.880 --> 0:04:26.320 Propose this or that resolution or legislation, it passes, and 0:04:26.360 --> 0:04:28.479 then you're on to the next piece of legislation. The 0:04:28.520 --> 0:04:30.720 big difference in the executive branch is you own it. 0:04:31.800 --> 0:04:33.440 When I used to teach at the Kennedy School. We 0:04:33.520 --> 0:04:36.240 used to say Tom that ninety percent of life is implementation. 0:04:36.800 --> 0:04:39.520 Ninety percent of life in the executive branch is implementation. 0:04:39.960 --> 0:04:42.359 None of these people, for the most part, have experience 0:04:42.600 --> 0:04:43.800 with implementing policies. 0:04:43.839 --> 0:04:47.240 Speak to people that voted for President elect Trump but 0:04:47.279 --> 0:04:49.840 are really not a fan of President elect Trump. It 0:04:49.920 --> 0:04:53.440 was a negative vote versus the Democrats. Speak to those 0:04:53.520 --> 0:04:58.560 people about how you perceive this will amend from January 0:04:58.680 --> 0:05:01.080 to February to lie of next year. 0:05:02.720 --> 0:05:04.719 Not sure what you're asking me, Sorry, how the people? 0:05:04.880 --> 0:05:09.839 The people, the people, the behavior, the enthusiasm that's reel Now, 0:05:10.440 --> 0:05:12.839 how will they amend the summer of next year? 0:05:13.400 --> 0:05:15.280 Well, again, it's going to be more sobering because what 0:05:15.279 --> 0:05:17.960 they're going to find out, Whether it's on say, immigration policy, 0:05:18.200 --> 0:05:21.400 it's one thing to talk about mass deportations, it's something 0:05:21.440 --> 0:05:23.839 else actually to bring it about. You've got to find people. 0:05:23.839 --> 0:05:26.320 You've got to then presumably arrest people. You've got if 0:05:26.320 --> 0:05:27.880 you want to deport people, you've got to get through 0:05:27.960 --> 0:05:30.479 legal challenges. You then have to find host countries willing 0:05:30.520 --> 0:05:33.080 to take them. You've got to deal with the physical 0:05:33.120 --> 0:05:37.040 and economic, uh disruptions of it, and every. 0:05:37.520 --> 0:05:41.120 Conversation we could have again. You know what, right now we. 0:05:41.120 --> 0:05:43.920 Have sort of positions that have been staked out, actually 0:05:43.960 --> 0:05:47.200 making them policies. Translating into policies is going to be difficult. 0:05:47.920 --> 0:05:49.880 And then also in other areas, like, for example, you've 0:05:49.880 --> 0:05:52.000 talked a lot here about tariffs and the like, there's 0:05:52.040 --> 0:05:54.560 going to be consequences to those and ones when one 0:05:54.600 --> 0:05:56.839 can't just be quote unquote protaph, one's going to have 0:05:56.880 --> 0:05:59.360 to say, well, what about the inflationary effects of that? 0:05:59.400 --> 0:06:01.719 And so forth. So in every one of these areas, we're. 0:06:01.560 --> 0:06:03.400 Going to have to deal with the knock on effects 0:06:03.600 --> 0:06:05.400 of these articulated stances. 0:06:05.760 --> 0:06:09.240 What do you make of just the cabinet picks that 0:06:09.279 --> 0:06:11.680 we've seen this week from the President elect? 0:06:11.680 --> 0:06:13.440 What's your takeaway to mix back? 0:06:13.560 --> 0:06:17.160 I thought I was somewhat reassured by Senator Rubio and 0:06:17.520 --> 0:06:20.760 the fact not quite a cabinet position. National Security Advisor. 0:06:22.080 --> 0:06:22.599 Mister Waltsch. 0:06:22.640 --> 0:06:24.800 Yeah, he's worked in the executive branch, has working in 0:06:24.800 --> 0:06:27.520 the pentagons, so he has the most he has the 0:06:27.520 --> 0:06:32.560 most experience of anybody. They're both internationalists, both very tough 0:06:32.600 --> 0:06:35.839 on China, though exactly what that translates into being a policy. 0:06:36.000 --> 0:06:38.719 It's not clear, but I basically felt that was fine. 0:06:39.080 --> 0:06:42.279 Much less comfortable with the choice for intelligence and above 0:06:42.320 --> 0:06:45.359 all for Secretary of Defense. Again, this is somebody without 0:06:45.400 --> 0:06:48.880 any governing experience. Pentagons one of the biggest, if not 0:06:48.960 --> 0:06:52.840 the biggest management job in the government, and to put 0:06:52.839 --> 0:06:56.560 someone in that seat who doesn't have experience, to me 0:06:56.720 --> 0:06:58.840 is eyewordering. 0:06:59.160 --> 0:07:01.080 We're gonna come back with Richard Hause. I have to 0:07:01.120 --> 0:07:03.599 ask the journalist a question, would you serve within this 0:07:03.760 --> 0:07:05.159 new administration? 0:07:06.360 --> 0:07:08.560 The odds of me being asked, Tom arebout equal to 0:07:08.600 --> 0:07:09.520 your being asked. 0:07:11.360 --> 0:07:13.560 What are you doing for? Cent of your partners. 0:07:13.640 --> 0:07:16.680 Spending a lot of time talking to CEOs about the 0:07:16.720 --> 0:07:21.480 world and how it affects their business plans, supply chains, markets, 0:07:21.960 --> 0:07:25.280 name it, and also try to increase our international business. 0:07:25.320 --> 0:07:27.080 So I've been traveling around the world doing what I can. 0:07:27.160 --> 0:07:30.400 There one thing I've learned doing this new project, Richard, 0:07:30.760 --> 0:07:32.040 is the international nature. 0:07:32.120 --> 0:07:34.000 PAULA, Good morning in San Diego, Chile. 0:07:34.720 --> 0:07:39.040 Chile offers expats and people leaving America a vibrant and 0:07:39.080 --> 0:07:42.840 diverse experience. You can benefit from the country's thriving job market, 0:07:42.920 --> 0:07:46.720 affordable cost of living in rich cultural Hairiness. Richard as 0:07:47.840 --> 0:07:51.760 on the people out there that want to leave America, Now, 0:07:51.840 --> 0:07:53.280 what do you say to them. 0:07:54.120 --> 0:07:57.120 I'm not big on leaving America. This country is still 0:07:57.120 --> 0:08:00.320 the greatest experiment on earth. And if you have problems 0:08:00.400 --> 0:08:03.760 or difficulties, then stay in the system and work block, 0:08:04.200 --> 0:08:05.960 work against things you don't want to see, work in 0:08:06.000 --> 0:08:08.800 favor of those things you want to say. There's so 0:08:08.800 --> 0:08:11.120 many ways to make a difference in government, in the 0:08:11.160 --> 0:08:14.240 private sector, in civil society. I just don't understand this 0:08:14.360 --> 0:08:15.520 argument for leaving and. 0:08:15.520 --> 0:08:17.880 What people in the punditry I see this, They think 0:08:17.920 --> 0:08:20.040 we're four years out to twenty eight. We have a 0:08:20.080 --> 0:08:24.280 congressional election where congress people start running in one year 0:08:24.760 --> 0:08:27.520 for the election of twenty six, which is basically tomorrow. 0:08:28.280 --> 0:08:28.720 You got that. 0:08:28.760 --> 0:08:30.920 We've also got a mayor election in this city in 0:08:30.960 --> 0:08:33.320 New York in exactly a year. 0:08:33.520 --> 0:08:34.439 Got to think about that. 0:08:34.679 --> 0:08:37.319 We also have the two hundred and fiftieth anniversary of 0:08:37.360 --> 0:08:39.880 this country coming up. That could be a collective teaching 0:08:40.960 --> 0:08:44.240 about the value of being a citizen in this American 0:08:44.280 --> 0:08:45.320 democracy of ours. 0:08:45.640 --> 0:08:48.640 Richard, talk to us about the challenges of China. Hear 0:08:48.720 --> 0:08:53.480 for this new Trump administration where do you think the 0:08:53.640 --> 0:08:56.160 US is going as it relates to China these days? 0:08:57.000 --> 0:08:59.040 What's clear to me is the direction in the sense 0:08:59.040 --> 0:09:01.720 that we are going to become tougher, particularly on the 0:09:01.760 --> 0:09:03.760 economic side. I think that's good, and by the way, 0:09:03.760 --> 0:09:06.440 that had already happened under the Biden administration, which continued 0:09:06.480 --> 0:09:09.160 the previous Trump administration. I think there the hours are 0:09:09.160 --> 0:09:12.360 pretty clear. The biggest question I have is to what 0:09:12.480 --> 0:09:16.319 extent will be prepared to resist China geopolitically if China 0:09:16.400 --> 0:09:19.040 does something, for example, against the Philippines in the South 0:09:19.200 --> 0:09:21.520 China see, which has the potential to be the first 0:09:21.559 --> 0:09:25.000 foreign policy crisis for this administration. If China ultimately does 0:09:25.440 --> 0:09:29.240 puts greater pressure on on Taiwan, what tools is this 0:09:29.280 --> 0:09:31.960 administration willing to bring to bear? Would it just be 0:09:32.000 --> 0:09:35.800 economic tools, tariffs and sanctions, or would they be prepared 0:09:35.800 --> 0:09:38.440 to bring military tools to bear. I think that's a big, 0:09:38.480 --> 0:09:39.040 big question. 0:09:39.480 --> 0:09:43.000 The heart of your book, The Bill of Obligations, The 0:09:43.040 --> 0:09:46.800 Ten Habits of Good Citizens is our checks imbalances. You 0:09:46.880 --> 0:09:50.120 mentioned earlier, Ambassador that there's going to be action by 0:09:50.160 --> 0:09:53.400 the new administration, and they'll be legal pushback. 0:09:53.520 --> 0:09:54.560 How will that unfold? 0:09:55.040 --> 0:09:57.520 Tommy rais a big question there. For the first time 0:09:57.559 --> 0:10:01.840 in modern memory, we've become effected a parliamentary system. You've 0:10:01.840 --> 0:10:05.240 got one party, indeed one individual with the lion's share 0:10:05.280 --> 0:10:08.040 of control, the White House, the Senate, the House, and 0:10:08.120 --> 0:10:11.480 Supreme Court that tilts that way. So we no longer 0:10:11.520 --> 0:10:14.880 really have checks and balances to a significant degree at 0:10:14.920 --> 0:10:17.600 the federal level. So the real question is how does 0:10:17.640 --> 0:10:21.400 this president, how does this administration comport itself? Does it 0:10:21.480 --> 0:10:24.520 respect any limits? Yes, they won the election, but forty 0:10:24.520 --> 0:10:27.080 eight to forty nine percent of America voted against them. 0:10:27.240 --> 0:10:28.400 And the real question is. 0:10:28.320 --> 0:10:30.640 Does our system work with this degree. 0:10:30.280 --> 0:10:31.600 Of concentration of power? 0:10:31.760 --> 0:10:33.920 And what makes me a little bit uneasy tom is 0:10:33.960 --> 0:10:37.600 we're beginning to see somehowld I call it extra exstitutional 0:10:37.880 --> 0:10:41.880 institutional things. For example, this potential board of our military 0:10:41.920 --> 0:10:45.040 people to look at the political orientation of the of 0:10:45.080 --> 0:10:48.920 the generals, or what elon Musks and Vivekas are being 0:10:48.960 --> 0:10:53.240 asked to do postage possibly also a trades our position. 0:10:53.280 --> 0:10:55.600 What's interesting about all these things? You should you're giving 0:10:55.640 --> 0:10:58.600 people the authority, but they're not really accountable, and that 0:10:58.640 --> 0:10:59.400 makes me uneasy. 0:11:00.160 --> 0:11:03.760 Legally, a posed can we can someone out there say 0:11:04.520 --> 0:11:08.240 I don't like doge efficiency, whatever it is, I want 0:11:08.280 --> 0:11:09.360 to sue somebody is there. 0:11:09.720 --> 0:11:11.640 I mean, we've never been here, right. 0:11:11.720 --> 0:11:14.880 Right, And traditionally the courts are reluctant to enter into, 0:11:15.000 --> 0:11:18.200 to step into what they consider to be political disputes, So. 0:11:18.120 --> 0:11:19.080 I would be surprised. 0:11:19.080 --> 0:11:21.480 My guess is the president will have a lot of 0:11:21.520 --> 0:11:25.319 authority to create these positions of authority potentially also through 0:11:25.360 --> 0:11:29.000 recess appointments, but beyond the cabinet, beyond positions that have 0:11:29.040 --> 0:11:29.720 to be confirmed. 0:11:30.840 --> 0:11:31.440 Elon Musk. 0:11:31.480 --> 0:11:33.160 You mentioned Elon Musk. I think a lot of our 0:11:33.160 --> 0:11:35.520 listeners and our viewers are wondering what role was he 0:11:35.679 --> 0:11:38.840 going to really play in this government? 0:11:38.840 --> 0:11:41.160 Do you think at the most. 0:11:40.960 --> 0:11:43.080 I understanding he's been down in mar A Lago since 0:11:43.160 --> 0:11:43.880 election day. 0:11:44.160 --> 0:11:46.960 It's it's just when you think you've seen everything, you 0:11:47.040 --> 0:11:49.199 realize you haven't seen everything. And the idea that he's 0:11:49.240 --> 0:11:51.679 on this or that phone call and seems to have 0:11:51.720 --> 0:11:55.760 this brief with no uh with no clear borders to it. Again, 0:11:56.480 --> 0:11:59.720 I think there's real questions about Elon must Yes, he's genius, 0:11:59.720 --> 0:12:01.880 what do you what he's done with space launch, with 0:12:01.960 --> 0:12:06.640 Starlink and the rest is fantastic, but I get nervous 0:12:06.679 --> 0:12:08.640 when I see this degree of power in the hands 0:12:08.640 --> 0:12:11.760 of an individual who's essentially beyond accountability. He's got his 0:12:11.800 --> 0:12:14.840 own political agenda. We've seen it on X during the campaign. 0:12:15.000 --> 0:12:18.400 He's got his own foreign policy agenda. So he's clearly 0:12:18.480 --> 0:12:20.560 going to have a role. Presidents are allowed to have 0:12:20.679 --> 0:12:24.720 kitchen cabinets. That's happened since time immemorial, but usually it's limited. 0:12:24.840 --> 0:12:27.679 And the question is here, how operational does he get? 0:12:27.880 --> 0:12:29.800 I think that's just a question mark out there. 0:12:29.960 --> 0:12:31.160 The heart of your work. 0:12:31.200 --> 0:12:33.719 I think of Ambassador Harmance as well as we need 0:12:33.760 --> 0:12:39.280 to be strong and structured and responsible at home before 0:12:39.320 --> 0:12:42.640 we look to a proactive foreign policy. In this election, 0:12:42.840 --> 0:12:47.160 I would suggest crime was front center off of immigration migration. 0:12:48.400 --> 0:12:51.800 It wasn't Nixon sixty eight or Nixon seventy two. But 0:12:52.120 --> 0:12:56.880 how do we deal domestically with clearly a nation's worry 0:12:57.040 --> 0:12:57.760 about crime. 0:12:59.520 --> 0:13:01.480 Well, first of all, you're right, I think the border 0:13:01.480 --> 0:13:04.560 had tremendous impact, along with inflation and so forth. The 0:13:04.559 --> 0:13:06.640 first thing I say, Tom is not to have less 0:13:06.679 --> 0:13:09.520 foreign policy. Our problems at home are real, but they're 0:13:09.559 --> 0:13:12.000 not caused about what we're doing or spending in the world. 0:13:12.040 --> 0:13:14.839 As a percentage of GDP, all of our defense is 0:13:14.880 --> 0:13:17.480 still only roughly half what we did during the Cold War. 0:13:17.720 --> 0:13:20.560 Look on crime, there's no one thing, but I would 0:13:20.559 --> 0:13:23.400 basically say it's where the Democrats got it so wrong 0:13:23.480 --> 0:13:25.520 with defund the police. We ought to fund the police, 0:13:25.559 --> 0:13:27.480 We ought to train the police, we ought to expand 0:13:27.480 --> 0:13:30.439 the police and make them more professional. And yes they've 0:13:30.480 --> 0:13:32.320 got to be accountable, but we need more police, so 0:13:32.320 --> 0:13:33.280 we need better police. 0:13:33.520 --> 0:13:36.559 This just across a headline in the Bloomberg The US 0:13:36.640 --> 0:13:41.520 Ambassador to Kenya, Meg Whitman, says, she tenders her regulation. 0:13:41.880 --> 0:13:46.880 What will become of her resignation? Tenders her resignation is 0:13:46.960 --> 0:13:52.319 Ambassador to Kenya. What will become of a conventional state department? 0:13:53.400 --> 0:13:58.160 Well, again, Marco Rubio is not a revolutionary. On the 0:13:58.200 --> 0:14:00.800 other hand, he inherits a much weakened state department. The 0:14:00.840 --> 0:14:03.959 best in the brightest no longer are joining the foreign service. 0:14:04.440 --> 0:14:08.520 State department has lost enormous influence to the National Security Council, 0:14:08.559 --> 0:14:11.880 which has grown topsy turvy over the last few administrations. 0:14:12.080 --> 0:14:14.520 So Marco Rubio is one of his big challenges. In 0:14:14.520 --> 0:14:17.200 addition to the world addition to wars in the Middle 0:14:17.240 --> 0:14:19.520 East and war in Europe and the challenge of China. 0:14:19.880 --> 0:14:22.440 Marco Rubio is going to look inside this building and 0:14:22.480 --> 0:14:24.680 he's going to say, oh my god, I do not 0:14:24.840 --> 0:14:27.520 have the horses I need, and that's going to be 0:14:27.560 --> 0:14:28.200 a real problem for. 0:14:28.160 --> 0:14:29.040 What you going to hold him back? 0:14:30.200 --> 0:14:30.720 Migration? 0:14:31.360 --> 0:14:36.400 In reality, what should be the policy here for migration 0:14:36.480 --> 0:14:37.880 in this country? 0:14:38.640 --> 0:14:41.440 We want to have I think a large amount of 0:14:41.680 --> 0:14:45.000 legal immigration. It's been the great strength of America, over 0:14:45.000 --> 0:14:45.920 a million people of the year. 0:14:45.960 --> 0:14:47.440 We ought to look goough at the criteria. 0:14:47.680 --> 0:14:50.440 I think there's too much family unification, not enough getting 0:14:50.440 --> 0:14:53.680 the people in who bring the most talent and skills. 0:14:53.680 --> 0:14:55.880 I want well over a million people a year. Helps 0:14:55.920 --> 0:14:59.640 the economy, helps us demographically. We've got to fix the 0:14:59.640 --> 0:15:02.440 asside system. The idea that someone comes in here says 0:15:02.680 --> 0:15:05.200 I'm coming here for asylum, we can hear their. 0:15:05.080 --> 0:15:07.840 Case for six or seven years. It's crazy. 0:15:08.040 --> 0:15:10.360 I think basically we're going to have to reintroduce some 0:15:10.520 --> 0:15:13.760 version of remain in Mexico or remain outside the United 0:15:13.760 --> 0:15:19.600 States while you press your asylum case. But basically immigration 0:15:19.720 --> 0:15:22.360 is going to take a combination of a good legal program, 0:15:22.640 --> 0:15:25.680 but tougher border, and we've got to deal with those. 0:15:25.720 --> 0:15:29.000 We got to create the capacity to vet the people 0:15:29.040 --> 0:15:29.720 who want to come here. 0:15:29.800 --> 0:15:31.840 One final question, what is the tone? 0:15:31.960 --> 0:15:35.440 The number one question from chief executive officers when you 0:15:35.480 --> 0:15:36.880 speak at Centerview Partners. 0:15:37.440 --> 0:15:39.960 I think the biggest question right now is about China. 0:15:40.120 --> 0:15:43.600 So many of them are one way dependent on investment 0:15:43.640 --> 0:15:48.280 in China, China influenced supply chains. What particularly those in 0:15:48.320 --> 0:15:50.720 the technology space time, they want to know is what 0:15:50.800 --> 0:15:53.120 is the political environment they're going to be operating in, 0:15:53.200 --> 0:15:57.440 whether it's regulation, tariffs, sanctions. Also very concerned about what 0:15:57.480 --> 0:16:00.760 about geopolitics and how might that affect the US relationship. 0:16:00.800 --> 0:16:02.720 But I think for a lot of Americans that's issue 0:16:02.800 --> 0:16:04.880 number one. I would say for a lot issue number 0:16:04.920 --> 0:16:07.920 two might be Mexico, and that's where working out a 0:16:07.960 --> 0:16:11.280 relationship with the new leadership of Mexico. Can we figure 0:16:11.280 --> 0:16:14.120 out something where we can manage our border in a 0:16:14.120 --> 0:16:16.520 way that doesn't cause a massive trade crisis. At the 0:16:16.520 --> 0:16:17.720 same time, with Mexico, you. 0:16:17.720 --> 0:16:20.920 Can't say enough about the Bill of Obligations, the Ten 0:16:21.000 --> 0:16:24.120 Habits of Good Citizens, many other efforts, including the World 0:16:24.440 --> 0:16:26.680 which was my book of the summer I believe years ago. 0:16:26.800 --> 0:16:29.760 Richard Hawes, thank you so much. With Centerview Partners, and 0:16:29.800 --> 0:16:30.400 of course. 0:16:30.200 --> 0:16:35.360 The former president, he's he's very emeritus president, emeritus, absolute consol. 0:16:37.040 --> 0:16:38.880 One day you'll step down from the show and YouTube. 0:16:39.760 --> 0:16:42.600 John says, I'm emeritus every day. Jeh. Thank you, John, 0:16:42.680 --> 0:16:45.320 Thank you for that as well. Richard Hawes, thank you 0:16:45.360 --> 0:16:45.760 so much. 0:16:51.160 --> 0:16:55.040 You're listening to the Bloomberg Surveillance Podcast. Catch US live 0:16:55.120 --> 0:16:58.440 weekday afternoons from seven to ten am Eastern. Listen on 0:16:58.480 --> 0:17:01.720 applecar Play and then Broo with a Bloomberg Business app, 0:17:01.840 --> 0:17:03.560 or watch US live on YouTube. 0:17:03.680 --> 0:17:06.920 Jim Carron, he is with Morgan Stanley. Can't say enough 0:17:06.920 --> 0:17:11.399 about the holistic approach he takes. Jim, I saw today 0:17:11.520 --> 0:17:16.040 completely aside from the CPI report, JPL is laying off 0:17:16.200 --> 0:17:18.480 like five percent of their employees. 0:17:18.960 --> 0:17:21.840 You may actually darkened the door there, right. I was 0:17:21.960 --> 0:17:25.960 shocked by that. What does that say about science in America? Right? 0:17:25.960 --> 0:17:27.520 So the jet propultionon laugh, Thank you. 0:17:27.560 --> 0:17:27.800 Tom. 0:17:27.840 --> 0:17:30.320 Always surprised with some of the questions. I get, Oh, 0:17:30.320 --> 0:17:31.080 but it's a shock. 0:17:31.160 --> 0:17:31.840 I mean they're like. 0:17:32.040 --> 0:17:34.639 Iconic, Yes, it is iconic. 0:17:34.720 --> 0:17:37.880 It's it was viewed as welfare for Caltech students because 0:17:38.040 --> 0:17:40.080 you could always get a job there. But look, I 0:17:40.520 --> 0:17:43.040 think science and technology at least may be there from 0:17:43.119 --> 0:17:45.359 what they're doing. It could be a slow period, but 0:17:45.440 --> 0:17:47.840 let me tell you, it's it's not going away. 0:17:48.320 --> 0:17:51.320 Is inflation going away? There seems to be some angst 0:17:51.359 --> 0:17:51.960 about that. 0:17:52.680 --> 0:17:55.320 So I'm in the camp that we do have an 0:17:55.359 --> 0:17:57.359 inflation issue. That doesn't mean that I don't think that 0:17:57.400 --> 0:18:00.120 inflation's coming down right now, and I think that it is. 0:18:00.600 --> 0:18:02.240 I just think that we're going to have a hard 0:18:02.240 --> 0:18:05.199 time keeping it at target levels around two percent for 0:18:05.240 --> 0:18:09.280 an extended period of time. Therefore, any uptick or failure 0:18:09.400 --> 0:18:13.720 for inflation to come down materially creates more anxiety for me. 0:18:14.160 --> 0:18:15.679 And I think that's the way the markets are going 0:18:15.680 --> 0:18:17.440 to think about it, and certainly that is the way 0:18:17.480 --> 0:18:19.640 that the FED is going to react to it as well. 0:18:20.280 --> 0:18:22.320 So should the Fed sit on the sidelines here? Are 0:18:22.320 --> 0:18:24.320 they kind of done for the near term? 0:18:24.400 --> 0:18:24.800 Do you think? 0:18:25.080 --> 0:18:25.240 No? 0:18:25.320 --> 0:18:27.800 I think the Fed is on a mission to four percent, 0:18:28.000 --> 0:18:31.159 because if you listen to their last policy statements, what 0:18:31.160 --> 0:18:34.280 they said is that they're lowering interest rates, they're not easy, 0:18:34.320 --> 0:18:35.640 which means that they still believe that. 0:18:35.560 --> 0:18:38.000 They're very tight right now. Okay, so if anything they 0:18:38.000 --> 0:18:38.560 want to get to. 0:18:38.560 --> 0:18:40.800 Neutral, are they very tight? 0:18:42.280 --> 0:18:45.119 So the last guess, no, Yeah, So I was going 0:18:45.200 --> 0:18:47.000 to say, like on financial conditions, if you look at 0:18:47.040 --> 0:18:48.840 credit spreads, if you look at what's going on in 0:18:48.840 --> 0:18:52.480 equity markets and what have you, it wouldn't seem like 0:18:52.520 --> 0:18:55.160 they are very tight. But based on their own models 0:18:55.520 --> 0:18:57.639 where you think of the neutral rate, what they're worried 0:18:57.680 --> 0:19:00.000 about is if you get a slowdown in the econom 0:19:00.080 --> 0:19:03.040 I mean, you could get what's called reflexivity, which is 0:19:03.080 --> 0:19:05.560 a sudden rise in the unemployment rate. So if you 0:19:05.600 --> 0:19:08.399 don't get rates to the proper levels today, which is 0:19:08.440 --> 0:19:10.720 around neutral, and if you do get this slow down 0:19:10.760 --> 0:19:14.320 in the future, you could get a surprise accelerated rise 0:19:14.359 --> 0:19:16.720 in the unemployment rate. That's what they're trying to stay 0:19:16.760 --> 0:19:17.480 in front of right now. 0:19:17.560 --> 0:19:21.720 Is the FED restrictive for the America that just voted 0:19:21.760 --> 0:19:22.679 for Donald Trump? 0:19:24.440 --> 0:19:25.560 You know, that's a good question. 0:19:26.359 --> 0:19:28.560