1 00:00:09,720 --> 00:00:12,880 Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene with 2 00:00:13,560 --> 00:00:16,560 Speaker 1: David Gura. Daily we bring you insight from the best 3 00:00:16,560 --> 00:00:22,239 Speaker 1: of economics, finance, investment, and international relations. Find Bloomberg Surveillance 4 00:00:22,320 --> 00:00:27,000 Speaker 1: on Apple Podcasts, SoundCloud, Bloomberg dot Com, and of course 5 00:00:27,320 --> 00:00:34,280 Speaker 1: on the Bloomberg Jamachael McKain. Tom Keane and the gross 6 00:00:34,320 --> 00:00:37,080 Speaker 1: transaction on U t x c O L is thirty 7 00:00:37,080 --> 00:00:39,319 Speaker 1: billion dollars with the debt added in all, then it's 8 00:00:39,320 --> 00:00:44,320 Speaker 1: a rather sizable transaction. He has a sizeable reputation UH 9 00:00:44,400 --> 00:00:48,360 Speaker 1: in international relations, and it's linkage into our military affairs. 10 00:00:48,800 --> 00:00:51,800 Speaker 1: April James travit Sef of course, dean of the Fletcher School, 11 00:00:52,000 --> 00:00:55,680 Speaker 1: Toughs University. Amos Davids joining us on our phone lines. 12 00:00:55,920 --> 00:01:00,360 Speaker 1: Amates davidis Mr Keegan. John Keegan the end of his 13 00:01:00,440 --> 00:01:04,000 Speaker 1: wonderful book The Face of Battle writes a small set 14 00:01:04,040 --> 00:01:09,000 Speaker 1: of paragraphs on the abolition of battle. We're always fighting 15 00:01:09,080 --> 00:01:13,640 Speaker 1: the last Korean War? What's the risk here of us 16 00:01:13,760 --> 00:01:21,119 Speaker 1: fighting Korean battles and wars of another place in time? Unfortunately, Tom, 17 00:01:21,240 --> 00:01:24,559 Speaker 1: I would say that the percentage chance of a war 18 00:01:24,600 --> 00:01:28,600 Speaker 1: on the Korean peninsula has just risen considerably. Now it's 19 00:01:28,640 --> 00:01:31,440 Speaker 1: a small baseline. So if we were looking at a 20 00:01:31,520 --> 00:01:35,080 Speaker 1: five percent chance of active war, I think it's now 21 00:01:35,360 --> 00:01:39,160 Speaker 1: doubled to ten. And I think that's because we have 22 00:01:39,280 --> 00:01:43,680 Speaker 1: crossed the threshold with the demonstrable capability of a hydrogen 23 00:01:43,720 --> 00:01:46,800 Speaker 1: bomb on the part of a highly unpredictable young leader. 24 00:01:46,959 --> 00:01:50,000 Speaker 1: So um, the chances of a new war in that peninsula, 25 00:01:50,120 --> 00:01:53,880 Speaker 1: unfortunately are increasing. But our memory, particularly for those of 26 00:01:54,000 --> 00:01:57,920 Speaker 1: a certain vintage, is John Glennard Ted Williams flying sorties 27 00:01:58,360 --> 00:02:03,440 Speaker 1: over North Korea. That's ancient history. What does a new 28 00:02:03,600 --> 00:02:09,519 Speaker 1: military set of events look like on the Korean Peninsula. Well, 29 00:02:09,560 --> 00:02:11,720 Speaker 1: it'll start the good old fashioned way, which will be 30 00:02:11,800 --> 00:02:16,000 Speaker 1: a massive artillery parage which will probably kill five thousand 31 00:02:16,080 --> 00:02:19,000 Speaker 1: people in the vicinity of Soul coming from North Korea. 32 00:02:19,280 --> 00:02:23,000 Speaker 1: But from that point forward, tom it'll look very much 33 00:02:23,080 --> 00:02:27,399 Speaker 1: twenty one century. You'll see unmanned vehicles used extensively. There'll 34 00:02:27,440 --> 00:02:31,200 Speaker 1: be a huge cyberpiece of this. Special operations will be 35 00:02:31,240 --> 00:02:36,000 Speaker 1: moving all over that peninsula, and they'll be a large 36 00:02:36,400 --> 00:02:41,280 Speaker 1: long range strike package coming from our heavy bombers in Guam, 37 00:02:41,400 --> 00:02:45,239 Speaker 1: and probably three or four aircraft carriers all in all 38 00:02:45,280 --> 00:02:49,200 Speaker 1: not a pretty site. It'll be a mix of nineteen 39 00:02:49,240 --> 00:02:54,840 Speaker 1: fifties Korea, but much more one century fewer troops on 40 00:02:54,880 --> 00:02:58,440 Speaker 1: the ground. That will be the big distinction. Good morning, 41 00:02:58,520 --> 00:03:05,280 Speaker 1: Mr cheerful. Uh. I don't even want to see that 42 00:03:05,400 --> 00:03:08,520 Speaker 1: at all, Uh, But none of us do. That kind 43 00:03:08,520 --> 00:03:11,760 Speaker 1: of question that arises, though, is since given what we're 44 00:03:11,760 --> 00:03:17,000 Speaker 1: talking about, does either side use nuclear weapons tactical or otherwise. 45 00:03:18,600 --> 00:03:23,519 Speaker 1: That's the huge question, and that when I mentioned opening 46 00:03:23,720 --> 00:03:27,600 Speaker 1: an artillery barrage against Soul from the north at temptation 47 00:03:27,760 --> 00:03:31,040 Speaker 1: on the part of the US forces will be to 48 00:03:31,120 --> 00:03:34,760 Speaker 1: use tactical nuclear weapons to prevent that. Kim Jong n, 49 00:03:34,880 --> 00:03:36,800 Speaker 1: on the other hand, will be tempted to use his 50 00:03:37,440 --> 00:03:42,280 Speaker 1: small arsenal small being perhaps twenty uh nuclear devices if 51 00:03:42,320 --> 00:03:46,680 Speaker 1: he feels the regime is under extreme threats. So I'd 52 00:03:46,720 --> 00:03:51,240 Speaker 1: say even within the small chances of an actual conflict 53 00:03:51,280 --> 00:03:55,600 Speaker 1: on the peninsula, the chances of nuclear use are even lower. 54 00:03:55,920 --> 00:03:58,280 Speaker 1: But none of it is negligible. And that's why we 55 00:03:58,320 --> 00:04:02,760 Speaker 1: need to put even more effort into a massive sanctions, 56 00:04:02,800 --> 00:04:07,720 Speaker 1: which could include targeted sanctions against Chinese companies doing business 57 00:04:07,760 --> 00:04:09,680 Speaker 1: in North Korea to get them in the game. To 58 00:04:09,800 --> 00:04:13,320 Speaker 1: really choke back Kim Jong un. Michael McFall, the former U. 59 00:04:13,360 --> 00:04:15,920 Speaker 1: S Inveassador to Russia who was now out at Stanford, 60 00:04:15,920 --> 00:04:18,760 Speaker 1: had a very interesting piece over the weekend and medium 61 00:04:19,040 --> 00:04:21,960 Speaker 1: dot Com. I commend it to you, Tom, where he says, 62 00:04:22,800 --> 00:04:24,560 Speaker 1: the first thing we need to do is figure out 63 00:04:24,600 --> 00:04:27,640 Speaker 1: what we want from the North Koreans. That our policy 64 00:04:27,680 --> 00:04:29,520 Speaker 1: is kind of all over the place. Some people want 65 00:04:29,600 --> 00:04:31,760 Speaker 1: them to give up nukes, some people want them to 66 00:04:31,800 --> 00:04:34,599 Speaker 1: freeze their nuke programs, some people want them to, you know, 67 00:04:34,839 --> 00:04:39,000 Speaker 1: surrender completely. Um. And then he says what we should 68 00:04:39,000 --> 00:04:43,560 Speaker 1: focus on is getting them to freeze their nuclear program, 69 00:04:43,640 --> 00:04:48,680 Speaker 1: and he thinks that's achievable. Um. I think he is 70 00:04:48,760 --> 00:04:52,640 Speaker 1: correct in the idea of freezing the nuclear program of 71 00:04:52,680 --> 00:04:56,040 Speaker 1: North Korea. I think there is zero chance North Korea, 72 00:04:56,120 --> 00:04:59,920 Speaker 1: Kim Jong un specifically will give up nuclear weapons voluntarily, 73 00:05:00,040 --> 00:05:02,920 Speaker 1: having watched what happened in his mind to adopt you, 74 00:05:03,000 --> 00:05:07,000 Speaker 1: what happened to Ukraine, what happened uh to to Saddam 75 00:05:07,080 --> 00:05:09,880 Speaker 1: Hussein one day, all gave up weapons mass destruction. So 76 00:05:10,480 --> 00:05:13,960 Speaker 1: zero chance of getting rento them. I think a possibility 77 00:05:14,000 --> 00:05:18,279 Speaker 1: of obtaining a freeze, it's going to require a massive 78 00:05:18,320 --> 00:05:20,520 Speaker 1: effort from the Chinese to get to that point and 79 00:05:20,560 --> 00:05:23,560 Speaker 1: if you're just joining us. James Stevins joined us. I 80 00:05:23,560 --> 00:05:26,279 Speaker 1: can't say enough about his book, The Leader's Workshop. It 81 00:05:26,400 --> 00:05:28,760 Speaker 1: is my book of the summer. Guess what, it's still 82 00:05:28,800 --> 00:05:31,200 Speaker 1: my book of the autumn as well. Really can't say 83 00:05:31,279 --> 00:05:35,280 Speaker 1: enough about the fifties, sixties, seventy books that are enclosed 84 00:05:35,320 --> 00:05:39,880 Speaker 1: within that from smart smart people, including the Secretary of Defense. 85 00:05:39,960 --> 00:05:42,760 Speaker 1: Also see Power Out, which has a little bit to 86 00:05:42,760 --> 00:05:44,640 Speaker 1: do with where we are right now. The chapter on 87 00:05:44,680 --> 00:05:49,600 Speaker 1: the Pacific will inform uh Amri Stevinus. When I look 88 00:05:49,640 --> 00:05:51,560 Speaker 1: at this, I guess, as I mentioned to Mike McKee, 89 00:05:51,560 --> 00:05:53,280 Speaker 1: I was sort of saying, where was the Secretary of 90 00:05:53,400 --> 00:05:57,479 Speaker 1: State this weekend? I'm trying to think of other secretaries 91 00:05:57,520 --> 00:06:01,400 Speaker 1: of state who would show the flag? Per se am 92 00:06:01,440 --> 00:06:05,719 Speaker 1: I right on it. Where is Mr Tillison? You're totally right, 93 00:06:05,760 --> 00:06:08,400 Speaker 1: and you know, show the flag would be great. I'd 94 00:06:08,600 --> 00:06:12,080 Speaker 1: I'd settle for just a statement from from Foggy Bottom. 95 00:06:12,080 --> 00:06:17,400 Speaker 1: It's it's incomprehensible, and frankly, all of the war fighting side, 96 00:06:17,440 --> 00:06:21,360 Speaker 1: including General Maddis, say hey, we need diplomacy that screams 97 00:06:21,360 --> 00:06:24,520 Speaker 1: for a secretary of state to stand up and get 98 00:06:24,560 --> 00:06:27,720 Speaker 1: counted and and just at a minimum, Um, we need 99 00:06:27,760 --> 00:06:31,000 Speaker 1: to spend a lot more time talking to our allies 100 00:06:31,000 --> 00:06:35,040 Speaker 1: in South Korea, not criticizing, not talk about breaking the 101 00:06:35,200 --> 00:06:38,359 Speaker 1: trade deal with him. Right now, that's where someone like 102 00:06:38,440 --> 00:06:40,920 Speaker 1: Tillerson needs to be weighing in, and he is missing 103 00:06:40,920 --> 00:06:44,200 Speaker 1: an action. Is the Ambassador Haley of the United Nations 104 00:06:44,240 --> 00:06:48,599 Speaker 1: auditioning for the part. Um, She's got my vote. She 105 00:06:48,800 --> 00:06:52,000 Speaker 1: has really of all the people in the national security 106 00:06:52,040 --> 00:06:55,800 Speaker 1: piece on the team. Uh, she stands out to me 107 00:06:56,080 --> 00:07:00,640 Speaker 1: with her independence, with her articulate voice, and in all 108 00:07:00,680 --> 00:07:03,480 Speaker 1: credit to her, she had no experience in diplomacy or 109 00:07:03,480 --> 00:07:06,120 Speaker 1: foreign policy, but she has stepped up and I think 110 00:07:06,240 --> 00:07:08,800 Speaker 1: is doing a terrific job. Now, this morning we got 111 00:07:08,800 --> 00:07:12,119 Speaker 1: indications from the Chinese and the Russians that didn't matter 112 00:07:12,120 --> 00:07:16,920 Speaker 1: what Nikki Haley says. They're not on board with stronger sanctions. Uh. 113 00:07:17,680 --> 00:07:21,400 Speaker 1: How do we persuade them? What's the best interest of Russia, 114 00:07:21,440 --> 00:07:23,640 Speaker 1: the best interest of China? How is it best served? 115 00:07:23,720 --> 00:07:26,840 Speaker 1: You know? What what argument do we make? I think 116 00:07:26,880 --> 00:07:30,160 Speaker 1: you have two principal arguments. Um. One is, let's call 117 00:07:30,200 --> 00:07:32,360 Speaker 1: it the dog on the leash argument, And if you 118 00:07:32,400 --> 00:07:35,960 Speaker 1: think of Kim Jong is a highly aggressive attack dog. 119 00:07:36,760 --> 00:07:39,800 Speaker 1: There is a leash, and China holds that leash, and 120 00:07:39,960 --> 00:07:42,560 Speaker 1: we need to convince China that if China lets that 121 00:07:42,640 --> 00:07:46,080 Speaker 1: dog actually bite somebody, we're going to kill it. Uh. 122 00:07:46,160 --> 00:07:48,560 Speaker 1: So there's the you're gonna lose your dog argument. And 123 00:07:48,600 --> 00:07:52,840 Speaker 1: the second one is global economy argument. Um, this is 124 00:07:52,920 --> 00:07:56,760 Speaker 1: trending towards something that will crack the global economy, particularly 125 00:07:56,800 --> 00:07:59,000 Speaker 1: in East Asia if we have a massive war in 126 00:07:59,000 --> 00:08:02,160 Speaker 1: that peninsula and you'll get flooded with refugees. So I 127 00:08:02,200 --> 00:08:04,640 Speaker 1: think there are two pretty salient arguments. I think what 128 00:08:04,760 --> 00:08:08,120 Speaker 1: slowing China down is the fact that the People's Congress 129 00:08:08,200 --> 00:08:11,120 Speaker 1: is not until the nineteenth of October. Until after that 130 00:08:11,200 --> 00:08:14,480 Speaker 1: when she consolidates power. Don't look for movement from China. 131 00:08:15,000 --> 00:08:17,280 Speaker 1: I just put out atmost of it. It's a photo 132 00:08:17,280 --> 00:08:19,400 Speaker 1: which I'm sure you know you may have it hanging 133 00:08:19,440 --> 00:08:23,520 Speaker 1: in your office, of one John Glenn and Ted Williams 134 00:08:23,560 --> 00:08:26,440 Speaker 1: sitting at a table with cups of coffee in Korea 135 00:08:26,960 --> 00:08:32,080 Speaker 1: and they got their leather flight jackets on in in that. 136 00:08:32,160 --> 00:08:35,679 Speaker 1: That's it's a remarkable photo. Are are pilots today younger 137 00:08:35,720 --> 00:08:41,000 Speaker 1: than they used to be. Our pilots are very young. Um, 138 00:08:41,080 --> 00:08:43,520 Speaker 1: they are younger than they were in Korea, Tom, And 139 00:08:43,559 --> 00:08:46,840 Speaker 1: the reason is in Korea we simply went back and 140 00:08:46,880 --> 00:08:50,800 Speaker 1: got veterans come from and so that's why they tend 141 00:08:50,800 --> 00:08:52,959 Speaker 1: to look a little older, act a little older. They 142 00:08:53,000 --> 00:08:54,760 Speaker 1: just put the pack on and went back to war. 143 00:08:55,440 --> 00:08:58,319 Speaker 1: Today are pilots that the young men and women who 144 00:08:58,320 --> 00:09:02,080 Speaker 1: will be flying these fighters and summers average age probably, 145 00:09:03,400 --> 00:09:06,199 Speaker 1: I don't think like I don't think Americans know this. 146 00:09:06,480 --> 00:09:09,680 Speaker 1: What's the average age on the deck of an aircraft carrier? All? 147 00:09:09,760 --> 00:09:12,560 Speaker 1: I've been screaming about this for years. The kids landing 148 00:09:12,600 --> 00:09:16,160 Speaker 1: these planes are like nineteen right nine, nineteen and a 149 00:09:16,240 --> 00:09:19,280 Speaker 1: half years old, and they are conducting the most complex 150 00:09:19,320 --> 00:09:24,160 Speaker 1: operation that a human mind can Amaic with. How can 151 00:09:24,200 --> 00:09:27,120 Speaker 1: we tell a nineteen year old kid landing that plane 152 00:09:27,160 --> 00:09:29,720 Speaker 1: with you flying at that he can't have a beer 153 00:09:29,760 --> 00:09:34,160 Speaker 1: in North Carolina? But someone explain this to me. There 154 00:09:34,400 --> 00:09:38,880 Speaker 1: is no explanation. I think we have gotten that one wrong. 155 00:09:38,920 --> 00:09:41,520 Speaker 1: And of course it was eighteen when you and I 156 00:09:41,600 --> 00:09:45,920 Speaker 1: were back in college and somehow drifted up to well 157 00:09:45,920 --> 00:09:53,319 Speaker 1: that was because and Tom, yeah, record led directly. Thank 158 00:09:53,360 --> 00:09:58,600 Speaker 1: you so much, James, in surveillance policy to make kidnapping legals, 159 00:09:58,600 --> 00:10:01,160 Speaker 1: so we could bring the admiral here and keep him 160 00:10:01,200 --> 00:10:03,600 Speaker 1: for three hours. Yeah, Mr Kimmath to join us as well. 161 00:10:03,720 --> 00:10:18,240 Speaker 1: We're strong on surveillance today with good experts. For your Michael, 162 00:10:18,240 --> 00:10:20,520 Speaker 1: why don't you bring in her steamed guest, Mr Bell 163 00:10:20,880 --> 00:10:24,560 Speaker 1: of Washington. Steve Bell has been around Washington for years 164 00:10:24,600 --> 00:10:28,920 Speaker 1: and years and years or Grant Grant Budget Committee, Senate 165 00:10:28,960 --> 00:10:32,800 Speaker 1: Budget Committee worked for remember Pete Dominici from the great 166 00:10:32,840 --> 00:10:36,520 Speaker 1: state of New Mexico. Um, and he knows he was there. 167 00:10:37,080 --> 00:10:39,000 Speaker 1: I don't want to make you sound old, Steve, but 168 00:10:39,080 --> 00:10:41,280 Speaker 1: you you were like Tom and I around for the 169 00:10:41,280 --> 00:10:45,000 Speaker 1: eight six tax reform efforts, and so you know what 170 00:10:45,240 --> 00:10:48,040 Speaker 1: is going on. This is a He is now with 171 00:10:48,120 --> 00:10:51,439 Speaker 1: the Bipartisan Policy Center. He's a senior adviser there. Um. 172 00:10:52,240 --> 00:10:55,160 Speaker 1: You know, um, this is an incredible month with all 173 00:10:55,280 --> 00:10:57,800 Speaker 1: kinds of things going on. We've got the debt limit, 174 00:10:57,840 --> 00:11:02,160 Speaker 1: we've got the continuing resolution. Meanwhile, tax reform of the 175 00:11:02,320 --> 00:11:06,320 Speaker 1: s CHIP, which is the children's essentially children's Medicare National 176 00:11:06,360 --> 00:11:09,840 Speaker 1: Flood Insurance they have to pass, which is very appropriate now. 177 00:11:09,960 --> 00:11:12,480 Speaker 1: Plus they're going to try to get Harvey money through. 178 00:11:13,320 --> 00:11:17,240 Speaker 1: How do you get all that done on Capitol Hills, 179 00:11:17,280 --> 00:11:20,559 Speaker 1: given you know the various factions and various parties at 180 00:11:20,559 --> 00:11:25,480 Speaker 1: this point, you get it done in the next twelve 181 00:11:25,559 --> 00:11:28,600 Speaker 1: to fifteen working days. I think what you're likely to 182 00:11:28,679 --> 00:11:34,080 Speaker 1: see is a ninety day short term continuing resolution that's 183 00:11:34,120 --> 00:11:37,920 Speaker 1: suspending twelve spending bills for government probably expire at the 184 00:11:38,000 --> 00:11:41,760 Speaker 1: end of December. UM you probably will see very little 185 00:11:41,800 --> 00:11:45,480 Speaker 1: progress on tax reform, and I think many people are 186 00:11:45,520 --> 00:11:48,280 Speaker 1: quite pessimistic about it. I think you'll see the debt 187 00:11:48,360 --> 00:11:51,840 Speaker 1: bill passed fairly easily, though it's going to have to 188 00:11:51,840 --> 00:11:55,720 Speaker 1: be bipartisan. I think the big problem here, and we 189 00:11:55,800 --> 00:11:59,640 Speaker 1: have to be candid about it, is this about every 190 00:11:59,679 --> 00:12:03,800 Speaker 1: two or three days, the president lobs a bomb in 191 00:12:03,840 --> 00:12:06,480 Speaker 1: the form of a twitter or a tweet, whatever it's called, 192 00:12:07,080 --> 00:12:10,120 Speaker 1: and it really does disrupt a lot of things that 193 00:12:10,200 --> 00:12:13,920 Speaker 1: the Congress is trying to do. I think the question 194 00:12:14,000 --> 00:12:18,640 Speaker 1: really is can the president handle all of the uncertainty 195 00:12:18,840 --> 00:12:22,800 Speaker 1: on the Hill as well as the growing tension UH 196 00:12:23,080 --> 00:12:27,440 Speaker 1: in the global arena UH ironing Tom the definition of 197 00:12:27,440 --> 00:12:30,400 Speaker 1: irony is Steve Bell saying the president lobs a tweet 198 00:12:30,760 --> 00:12:36,200 Speaker 1: and as Steve was speaking, the President lobbed a tweet 199 00:12:36,240 --> 00:12:39,640 Speaker 1: this from Donald J. Trump, Congress, get ready to do 200 00:12:39,720 --> 00:12:45,000 Speaker 1: your job, DACA, the Dreamer's program. Um, that's one more 201 00:12:45,040 --> 00:12:47,840 Speaker 1: thing he's going to throw on their plate. Well, you know, 202 00:12:48,320 --> 00:12:51,040 Speaker 1: we have to be honest here. He says he wants 203 00:12:51,080 --> 00:12:54,719 Speaker 1: to have the the the economy really gets sparked, and 204 00:12:55,080 --> 00:12:58,559 Speaker 1: going well, doc is probably the wrong thing to do 205 00:12:59,320 --> 00:13:02,080 Speaker 1: to to end, if that's what you want. The defense 206 00:13:02,160 --> 00:13:05,320 Speaker 1: increases in desperate trouble. I think, as everyone would agree, 207 00:13:05,880 --> 00:13:10,800 Speaker 1: infrastructure and spending cuts, large spending cuts and domestic programs 208 00:13:11,080 --> 00:13:14,120 Speaker 1: won't happen. And if you look at that, the president 209 00:13:14,240 --> 00:13:16,920 Speaker 1: is looking at about an O for four or O 210 00:13:17,120 --> 00:13:20,000 Speaker 1: for five kind of record on what he said his 211 00:13:20,080 --> 00:13:24,480 Speaker 1: priorities were. Now, I don't think given a recent ruling 212 00:13:24,520 --> 00:13:28,440 Speaker 1: by the Senate Parliamentarian that they cannot use the so 213 00:13:28,600 --> 00:13:33,120 Speaker 1: called fast track or reconciliation after the end of this month. 214 00:13:33,760 --> 00:13:35,840 Speaker 1: I don't think. I don't see a way forward on 215 00:13:35,920 --> 00:13:38,760 Speaker 1: taxes or any of the rest of this in December 216 00:13:39,320 --> 00:13:44,800 Speaker 1: without real bipartisan involvement. And right now there is very 217 00:13:44,800 --> 00:13:49,040 Speaker 1: little inclination. Steve Bell, we've been talking about Secretary Tellerson 218 00:13:49,040 --> 00:13:53,360 Speaker 1: in the geopolitics Korea. Where does Secretary Minution, the Secretary 219 00:13:53,360 --> 00:13:58,640 Speaker 1: of Treasury, Where does he fit into the legislative process 220 00:13:58,840 --> 00:14:02,480 Speaker 1: of tax reform? Well, he is a member of what 221 00:14:02,520 --> 00:14:05,600 Speaker 1: they call the Big six m of the two people 222 00:14:05,760 --> 00:14:09,400 Speaker 1: from the two centers, from the Senate Finance Committee to 223 00:14:09,600 --> 00:14:14,760 Speaker 1: from Ways and Mains. Mr Nusian and his people. He's critical. 224 00:14:15,240 --> 00:14:17,040 Speaker 1: But I've got to tell you a difference between in 225 00:14:17,960 --> 00:14:23,120 Speaker 1: six and here we are thirty one years later. President 226 00:14:23,200 --> 00:14:28,480 Speaker 1: Reagan gave us a four hundred and eighties, six page document, 227 00:14:29,120 --> 00:14:32,000 Speaker 1: not including the charts and the graphs, are not what 228 00:14:32,080 --> 00:14:34,880 Speaker 1: he wanted and how he would do tax reform. What 229 00:14:35,040 --> 00:14:38,760 Speaker 1: we have from the administration right now essentially is one 230 00:14:39,280 --> 00:14:42,440 Speaker 1: piece of paper, and that is just going to be 231 00:14:42,760 --> 00:14:46,160 Speaker 1: approved to be a huge burden on the hill as 232 00:14:46,160 --> 00:14:49,400 Speaker 1: you try to get something as complicated as tax reform done, 233 00:14:50,920 --> 00:14:54,920 Speaker 1: what you say, the odds are declining, um And I 234 00:14:54,960 --> 00:14:57,080 Speaker 1: think most people in Washington would agree with you for 235 00:14:57,240 --> 00:15:00,960 Speaker 1: tax reform. But what about the idea of tax cuts, 236 00:15:01,480 --> 00:15:05,640 Speaker 1: which is a different thing. And when you the old 237 00:15:06,560 --> 00:15:09,160 Speaker 1: the old line about nothing concentrates the mind like a hanging. 238 00:15:09,520 --> 00:15:11,920 Speaker 1: There is an election next year for members of Congress 239 00:15:11,920 --> 00:15:14,960 Speaker 1: who have nothing to show for their appearance in Washington 240 00:15:15,080 --> 00:15:18,840 Speaker 1: this year? Uh does that? Does that change the equation? 241 00:15:18,880 --> 00:15:22,840 Speaker 1: And maybe they just do something. Oh, I think I 242 00:15:22,880 --> 00:15:26,960 Speaker 1: think you've hit it well. I do expect a real 243 00:15:27,120 --> 00:15:29,400 Speaker 1: chance for tax cuts in the first quarter of this 244 00:15:29,520 --> 00:15:33,680 Speaker 1: coming year two thousand eighteen. It's going to increase the deficit, 245 00:15:34,080 --> 00:15:36,440 Speaker 1: but there aren't a lot of people left on Capitol 246 00:15:36,520 --> 00:15:40,960 Speaker 1: Hill that are afraid of big deficits. Well within this 247 00:15:41,080 --> 00:15:44,720 Speaker 1: and Mike's good question, where is Steve Bell's trip point 248 00:15:44,920 --> 00:15:49,040 Speaker 1: psychologically on deficit to GDP? Where at three point whatever 249 00:15:49,120 --> 00:15:53,400 Speaker 1: percent migrating towards a larger four percent deficit to GDP? 250 00:15:53,960 --> 00:15:55,800 Speaker 1: Is that a big deal? Or is your number five 251 00:15:55,920 --> 00:16:00,680 Speaker 1: or six or an even a grimmer number seven. I 252 00:16:00,760 --> 00:16:03,360 Speaker 1: think for me a six percent of GDP would be 253 00:16:03,400 --> 00:16:07,080 Speaker 1: considered very, very high and potentially dangerous because now you're 254 00:16:07,080 --> 00:16:11,920 Speaker 1: talking about twillion dollar annual deficits to get there. And 255 00:16:12,920 --> 00:16:16,600 Speaker 1: I think people don't realize as we get older, as demographics, 256 00:16:17,320 --> 00:16:19,880 Speaker 1: you know, works its charm on us, we are going 257 00:16:19,920 --> 00:16:23,240 Speaker 1: to be spending more and more on things that Congress 258 00:16:23,360 --> 00:16:28,080 Speaker 1: just simply doesn't want to touch. Medicare, medicaid, social security 259 00:16:28,080 --> 00:16:30,840 Speaker 1: and other pensions. I know I sound like a broken record, 260 00:16:31,360 --> 00:16:35,240 Speaker 1: but what Congress has done is taking cuts out of 261 00:16:35,240 --> 00:16:38,560 Speaker 1: the smallest part of the bude and and and it's 262 00:16:38,600 --> 00:16:40,040 Speaker 1: just not going to get it done through these so 263 00:16:40,160 --> 00:16:43,560 Speaker 1: called sequestertion caps are spending caps. Steve Bell with us, 264 00:16:43,560 --> 00:16:47,160 Speaker 1: We're going to continue this discussion. Michael mckeeth, Charles Gabriel 265 00:16:47,320 --> 00:16:52,760 Speaker 1: over it. Uh. Capital Alpha just publishes and he delicately 266 00:16:52,800 --> 00:16:57,760 Speaker 1: and with grace links together the data immigration debate with 267 00:16:57,920 --> 00:17:02,280 Speaker 1: tex reform. It doesn't make a firm linkage, but he says, 268 00:17:02,280 --> 00:17:07,320 Speaker 1: to believe your legislators, this is linkable. A member of 269 00:17:07,320 --> 00:17:09,120 Speaker 1: the House Freedom Caucus. I don't think it was Marc 270 00:17:09,160 --> 00:17:12,440 Speaker 1: badows Um, and I apologize to whoever it was that said. 271 00:17:12,480 --> 00:17:15,200 Speaker 1: It said this morning that if he does this dock 272 00:17:15,240 --> 00:17:16,719 Speaker 1: I think, and he throws it up to Capitol Hill, 273 00:17:16,760 --> 00:17:18,960 Speaker 1: which apparently he's going to do with his tweet this morning, 274 00:17:19,480 --> 00:17:22,639 Speaker 1: it could create a civil war. Yeah. I saw Stephen 275 00:17:22,720 --> 00:17:24,880 Speaker 1: King of Iowa. Stephen King of Iowa, you're right, Yes, 276 00:17:24,920 --> 00:17:27,720 Speaker 1: you're right. That was in my I mentioned that on television. 277 00:17:28,119 --> 00:17:29,560 Speaker 1: And so that's what we'd like to do, folks for 278 00:17:29,680 --> 00:17:32,560 Speaker 1: like to aggregate in all of the news flow we see. 279 00:17:32,760 --> 00:17:36,119 Speaker 1: We tried to do that every morning. I'm Bloomberg Surveillance. 280 00:17:36,800 --> 00:17:39,359 Speaker 1: Michael mckeeon for David Girl. I'm Tom Keane. Throwed you 281 00:17:39,480 --> 00:17:43,400 Speaker 1: with us Tuesday, back to school. I guess tomorrow maybe Thursday. 282 00:17:43,600 --> 00:17:47,159 Speaker 1: Were in hurricane Hurricane. Where are we? Update? Update on 283 00:17:47,680 --> 00:17:51,480 Speaker 1: is of five now and Florida has declared a state 284 00:17:51,560 --> 00:17:56,920 Speaker 1: of emergency an orange juice futures are up five goes 285 00:17:57,000 --> 00:18:00,080 Speaker 1: a gap higher. A lot of concern about it in 286 00:18:00,720 --> 00:18:03,639 Speaker 1: the groves of southern Florida. Well, we don't make jokes 287 00:18:03,640 --> 00:18:06,320 Speaker 1: about it, particularly after what we've witnessed in Texas and 288 00:18:06,320 --> 00:18:10,040 Speaker 1: what we continue to witness in Texas as well. Steve 289 00:18:10,080 --> 00:18:13,760 Speaker 1: Bell with us with the Bipartisan Policy Center. Mr Bell 290 00:18:13,880 --> 00:18:16,440 Speaker 1: joining us on our phone lines. I know Mike wants 291 00:18:16,480 --> 00:18:19,720 Speaker 1: to dive into the texts in fiscal affairs. Steve Bell, 292 00:18:19,960 --> 00:18:23,879 Speaker 1: Who are the Bipartisan Policy Center? I know it's been 293 00:18:23,960 --> 00:18:25,639 Speaker 1: on for ten years, but that's a new name. I 294 00:18:25,640 --> 00:18:32,159 Speaker 1: would say, relatively new. Uh. The former Majority leaders Howard Baker, 295 00:18:32,640 --> 00:18:36,760 Speaker 1: the late Howard Baker, George Mitchell, Bob Dole, and Tom 296 00:18:36,840 --> 00:18:40,440 Speaker 1: Dashville got together two Democrats and two Republics and they 297 00:18:40,480 --> 00:18:43,080 Speaker 1: started this and said, what we're going to do is 298 00:18:43,080 --> 00:18:45,440 Speaker 1: that we're going to have partisans from both sides. Noticed, 299 00:18:45,480 --> 00:18:49,800 Speaker 1: we don't call ourselves the Nonpartisan Policy Center to have 300 00:18:49,880 --> 00:18:52,240 Speaker 1: people here who We have people here who worked for Clinton, 301 00:18:52,520 --> 00:18:54,560 Speaker 1: we have people here who work for Obama, we have 302 00:18:54,600 --> 00:18:57,439 Speaker 1: people here who worked for the Bushes, and in at 303 00:18:57,520 --> 00:19:00,440 Speaker 1: least one case, a poor old guy like me who 304 00:19:00,480 --> 00:19:03,760 Speaker 1: was a Reagan person. So we really have a pretty 305 00:19:04,280 --> 00:19:07,600 Speaker 1: strong internal debate and we come out with what we 306 00:19:07,720 --> 00:19:12,159 Speaker 1: think our recommendations that will appeal to both Democrats and 307 00:19:12,200 --> 00:19:15,600 Speaker 1: Republicans or centrists up on the hill. How many Centrists 308 00:19:15,600 --> 00:19:17,960 Speaker 1: are left? How many centers are left on the hill? 309 00:19:18,080 --> 00:19:23,920 Speaker 1: Olympia Snow is gone, Yeah, well she's with us. The 310 00:19:24,160 --> 00:19:26,760 Speaker 1: truth is, for about the last six months we haven't 311 00:19:26,800 --> 00:19:31,680 Speaker 1: been overwhelmingly popular because the far left and the far 312 00:19:31,760 --> 00:19:33,960 Speaker 1: right look upon us as kind of skunks, I think. 313 00:19:34,520 --> 00:19:37,400 Speaker 1: But eventually there's going to be whether it's led by 314 00:19:37,880 --> 00:19:40,800 Speaker 1: to more Alexander's of the world, or whether it's led 315 00:19:40,880 --> 00:19:43,800 Speaker 1: by the Tom Coles of the world, or even Speaker Ryan, 316 00:19:44,080 --> 00:19:46,200 Speaker 1: there's going to have to be by parsnship because it's 317 00:19:46,200 --> 00:19:49,800 Speaker 1: not going to get much money. They have their acclaimed 318 00:19:49,800 --> 00:19:52,840 Speaker 1: bridge Builder breakfast. They had a tater fight at a 319 00:19:52,840 --> 00:19:58,120 Speaker 1: bridge fillers people throw and taters around. We we talk 320 00:19:58,160 --> 00:20:01,360 Speaker 1: a lot about the dysfunction on Capitol Hill, and everybody 321 00:20:01,440 --> 00:20:03,800 Speaker 1: is very cynical about what goes on. Going back to 322 00:20:03,840 --> 00:20:07,679 Speaker 1: your days on the Hill, when you worked for Senator 323 00:20:07,680 --> 00:20:09,960 Speaker 1: Pete Dominici, who would be he was a Republican, But 324 00:20:10,040 --> 00:20:14,080 Speaker 1: I said, in in the classical sense that definitely a 325 00:20:14,280 --> 00:20:16,880 Speaker 1: somebody who would be described as something of a centrist 326 00:20:17,400 --> 00:20:24,920 Speaker 1: special nowadays. Um, is there an institutional tug from being 327 00:20:25,040 --> 00:20:27,679 Speaker 1: in the Senate that keeps it from going off the 328 00:20:27,760 --> 00:20:30,000 Speaker 1: rails in the way that the House has or is 329 00:20:30,040 --> 00:20:34,760 Speaker 1: the Senate going the same way? I think there's an 330 00:20:34,760 --> 00:20:38,440 Speaker 1: institutional tug that keeps it from going off the rails. Uh. 331 00:20:38,480 --> 00:20:41,199 Speaker 1: We can talk about the relationship between Mr McConnell and 332 00:20:41,280 --> 00:20:44,639 Speaker 1: Mr Schumer from Majority and Minority leaders, but the fact 333 00:20:44,640 --> 00:20:47,280 Speaker 1: of the matter is they talk every day. UM. They 334 00:20:47,320 --> 00:20:50,320 Speaker 1: sit and make schedules out, and they have at the 335 00:20:50,320 --> 00:20:54,399 Speaker 1: staff level at least they have very open conversations. The 336 00:20:54,520 --> 00:20:57,840 Speaker 1: Senate is a different place, and one of the things 337 00:20:57,880 --> 00:20:59,959 Speaker 1: you can tell is this, the President has asked them 338 00:21:00,040 --> 00:21:02,560 Speaker 1: to get rid of the filibuster, and Mr McConnell and 339 00:21:02,640 --> 00:21:05,320 Speaker 1: others have said that's not going to happen, because that's 340 00:21:05,320 --> 00:21:08,600 Speaker 1: what makes the Senate, in large part the Senate. The 341 00:21:08,640 --> 00:21:11,840 Speaker 1: House has all these great ideas that bubble up. They 342 00:21:11,880 --> 00:21:13,960 Speaker 1: can pass them with just a majority. They don't have 343 00:21:13,960 --> 00:21:17,360 Speaker 1: to worry about any lengthy debate. And I can tell 344 00:21:17,400 --> 00:21:21,040 Speaker 1: you this, here's how staff reacts to good ideas. Yes, sir, 345 00:21:21,119 --> 00:21:23,639 Speaker 1: they say thank you for that idea. Then they go 346 00:21:23,720 --> 00:21:26,199 Speaker 1: back and hope in about four days the member forgets it. 347 00:21:27,520 --> 00:21:33,040 Speaker 1: Excuse me that it sounds like the keen household. I'm 348 00:21:33,080 --> 00:21:37,119 Speaker 1: just wondering because we there's so much concern expressed about 349 00:21:37,160 --> 00:21:39,960 Speaker 1: what's happening with the current document of the White House, 350 00:21:39,960 --> 00:21:43,439 Speaker 1: and so much concern expressed for Congress, particularly on the 351 00:21:43,440 --> 00:21:46,120 Speaker 1: House side. Do you worry about the state of our government? 352 00:21:46,200 --> 00:21:50,040 Speaker 1: Or is is the senator bulwark? No? I do worry. 353 00:21:50,920 --> 00:21:54,240 Speaker 1: You know, one of the most thoughtful members of the Senate, 354 00:21:54,880 --> 00:21:57,560 Speaker 1: uh is Senator Bob Cork of Tennessee, who's chairman of 355 00:21:57,600 --> 00:22:00,840 Speaker 1: the Foreign Relations Committee in the Senate. And when someone 356 00:22:01,119 --> 00:22:03,879 Speaker 1: that thoughtful and who doesn't really try to get the 357 00:22:03,880 --> 00:22:07,560 Speaker 1: spotlight that much, says that he worries about the competence 358 00:22:07,600 --> 00:22:10,719 Speaker 1: and stability of the president of the United States. You 359 00:22:10,760 --> 00:22:14,520 Speaker 1: can see that there is deep, deep misgivings among the 360 00:22:14,560 --> 00:22:18,760 Speaker 1: Senate Republican caucus at some point that is going to 361 00:22:18,840 --> 00:22:25,120 Speaker 1: emerge into outright um, if not opposition, certainly stubbornness against 362 00:22:25,119 --> 00:22:30,199 Speaker 1: the president. And I think DOCTA could be one of 363 00:22:30,240 --> 00:22:34,160 Speaker 1: those things that shows how balkanized the Republican Party is. 364 00:22:34,480 --> 00:22:37,399 Speaker 1: Steve Bell, thank you so much, very very informative, triffic 365 00:22:37,400 --> 00:22:40,080 Speaker 1: briefing with the Bipartisan Policy Center, And of course is 366 00:22:40,200 --> 00:22:45,560 Speaker 1: decades of observing the ballet and there's a difference in 367 00:22:45,640 --> 00:22:48,679 Speaker 1: it when he served there. Yeah, in different kind of 368 00:22:48,720 --> 00:22:51,639 Speaker 1: I will state this, and how odd to have it 369 00:22:51,720 --> 00:22:53,919 Speaker 1: at the end of the summer. The essay of the 370 00:22:53,960 --> 00:22:58,000 Speaker 1: summer was Senator McKain without question, whatever anybody's politics, or 371 00:22:58,480 --> 00:23:03,520 Speaker 1: what if here's somebody grievously ill with a screen. Do 372 00:23:03,560 --> 00:23:05,720 Speaker 1: you think, Mike, in anyway we can get back to 373 00:23:05,760 --> 00:23:08,160 Speaker 1: what you first covered in Washington. I don't know how. 374 00:23:08,520 --> 00:23:10,680 Speaker 1: I don't I don't know what the path is that's 375 00:23:10,720 --> 00:23:12,719 Speaker 1: we We should find somebody who could talk about that. 376 00:23:12,920 --> 00:23:16,520 Speaker 1: How you get back to We've been good people for that. 377 00:23:16,760 --> 00:23:21,480 Speaker 1: Remember Center Arthur Vanderberg. Politics stops at the water's edge. Yeah, 378 00:23:21,600 --> 00:23:25,040 Speaker 1: he was a very very um partisan guy and then 379 00:23:25,119 --> 00:23:39,000 Speaker 1: changed his mind so it could happen. This is an 380 00:23:39,000 --> 00:23:43,640 Speaker 1: important Uh interview, not only because he is a general 381 00:23:43,720 --> 00:23:46,080 Speaker 1: in the army and with his work with Central Command 382 00:23:46,160 --> 00:23:48,600 Speaker 1: and his work here and work there, and we make 383 00:23:48,720 --> 00:23:50,520 Speaker 1: light of the fact he went out and in a 384 00:23:50,560 --> 00:23:53,680 Speaker 1: weak moment got his c F a chartered financial analyst. 385 00:23:54,320 --> 00:23:58,800 Speaker 1: He is a sixteenth Assistant Secretary of State for Political 386 00:23:59,000 --> 00:24:04,600 Speaker 1: and Military Fairs, serving under George W. Bush Uh for 387 00:24:04,760 --> 00:24:07,199 Speaker 1: a good half year space there. Near the end of 388 00:24:07,880 --> 00:24:11,760 Speaker 1: the administration, Mark Kimmitt joins US General Kimmitt, Good morning. 389 00:24:12,040 --> 00:24:17,560 Speaker 1: Where is Secretary Tillerson? Is he missing an action? Well, 390 00:24:17,920 --> 00:24:20,439 Speaker 1: he certainly has not been very visible on this issue 391 00:24:20,480 --> 00:24:23,600 Speaker 1: of North Korea. I think that diplomacy and most people 392 00:24:23,640 --> 00:24:28,120 Speaker 1: believe that diplomacy is what's here and the State Department 393 00:24:28,119 --> 00:24:30,600 Speaker 1: needs to be part of that. Well, within part of that, 394 00:24:30,720 --> 00:24:34,320 Speaker 1: we've seen an Ambassador Haley at the United Nations. Um, 395 00:24:34,680 --> 00:24:37,480 Speaker 1: what what is the white here? Excuse me? And if 396 00:24:37,520 --> 00:24:44,840 Speaker 1: Secretary Tillerson is invisible, who is carrying forward our diplomacy? Well, 397 00:24:44,840 --> 00:24:47,200 Speaker 1: it's a hard thing. I would say at this point 398 00:24:47,240 --> 00:24:50,920 Speaker 1: it is Nicky Haley h But the national security team 399 00:24:50,960 --> 00:24:54,560 Speaker 1: that is working this, I would say it's primarily Department 400 00:24:54,600 --> 00:24:58,440 Speaker 1: of Defense Chief of Staff inside the White House and 401 00:24:58,760 --> 00:25:01,240 Speaker 1: oddly the trectories career as well that are taking the 402 00:25:01,320 --> 00:25:05,360 Speaker 1: lead on this overall issue. Your former job Assistant Secretary 403 00:25:05,400 --> 00:25:08,720 Speaker 1: for Political Military Affairs is vacant, as our most of 404 00:25:08,760 --> 00:25:14,119 Speaker 1: the assistant secretary's positions in the State Department. Now, the 405 00:25:14,160 --> 00:25:18,280 Speaker 1: President has suggested that we don't need very many diplomats 406 00:25:18,280 --> 00:25:21,119 Speaker 1: and that um, there needs to be a complete rethink 407 00:25:21,160 --> 00:25:24,560 Speaker 1: of how we do the Department of State. Are we 408 00:25:24,640 --> 00:25:27,040 Speaker 1: throwing out a baby with the bathwater? They're leaving aside 409 00:25:27,080 --> 00:25:30,320 Speaker 1: the individual issue of North Korea. But do we need 410 00:25:30,960 --> 00:25:33,800 Speaker 1: all the people that we have that we used to 411 00:25:33,840 --> 00:25:38,320 Speaker 1: have at State. Well, certainly we do. And and before 412 00:25:38,400 --> 00:25:42,639 Speaker 1: we're too critical on State Department, uh, a few months 413 00:25:42,640 --> 00:25:45,200 Speaker 1: ago we were having any Sense concerns about the Department 414 00:25:45,200 --> 00:25:48,800 Speaker 1: of Sense getting good people under the job. So while 415 00:25:48,880 --> 00:25:51,080 Speaker 1: it would be good to have a full State Department, 416 00:25:51,720 --> 00:25:55,080 Speaker 1: especially in the East State to Bureau, right now, I'm 417 00:25:55,119 --> 00:25:57,560 Speaker 1: pretty confident that the State Department we worked this out 418 00:25:57,560 --> 00:26:00,000 Speaker 1: and get the right people in the job over time. 419 00:26:01,240 --> 00:26:04,600 Speaker 1: If we do or do not, what what from your 420 00:26:04,640 --> 00:26:09,720 Speaker 1: perspective should we be doing with the Korean situation now? 421 00:26:09,720 --> 00:26:13,919 Speaker 1: And I go beyond just North Korean it's it's nukes 422 00:26:14,640 --> 00:26:17,720 Speaker 1: to the trade issues with South Korea. Reports that the 423 00:26:17,720 --> 00:26:20,600 Speaker 1: President is going to abrogate the US South Korea Free 424 00:26:20,600 --> 00:26:24,720 Speaker 1: Trade Agreement. Uh, how should we be handling what's going 425 00:26:24,800 --> 00:26:29,280 Speaker 1: on in Northern Asia? Well, at this time we probably 426 00:26:29,359 --> 00:26:32,120 Speaker 1: need more allies than pure allies, and some of these 427 00:26:32,119 --> 00:26:35,240 Speaker 1: concerns that have been brought up about the trade relations 428 00:26:35,280 --> 00:26:37,840 Speaker 1: with such this may be the wrong time to be 429 00:26:37,920 --> 00:26:41,960 Speaker 1: doing that. The situation with North Korea is grave and 430 00:26:42,240 --> 00:26:46,399 Speaker 1: it can't be something that we handle unilaterally. It's an issue, 431 00:26:46,760 --> 00:26:49,400 Speaker 1: as Nicky Hailey said yesterday, that needs the entire world 432 00:26:49,440 --> 00:26:51,960 Speaker 1: to come together, and to do that, we not only 433 00:26:52,000 --> 00:26:56,040 Speaker 1: need allies, but we need diplomats to promote those allies. 434 00:26:56,600 --> 00:27:01,639 Speaker 1: How did you react to the essay of uh of 435 00:27:01,640 --> 00:27:05,280 Speaker 1: of John McCain of a few days ago. Or he's 436 00:27:05,320 --> 00:27:08,560 Speaker 1: asking for a Congress that gets back to rules of order. 437 00:27:09,160 --> 00:27:13,840 Speaker 1: This interesting linkage of military service with our legislative and 438 00:27:13,880 --> 00:27:17,520 Speaker 1: executive sectors. You have great experience in this do we 439 00:27:17,560 --> 00:27:21,440 Speaker 1: need to get a Congress back to regular order? But 440 00:27:21,600 --> 00:27:23,520 Speaker 1: what we need is a Congress that can get into 441 00:27:23,560 --> 00:27:27,400 Speaker 1: the business of passing the legislation. UH for any number 442 00:27:27,440 --> 00:27:31,359 Speaker 1: of reasons. The current Congress is locked up on a 443 00:27:31,440 --> 00:27:34,800 Speaker 1: significant number of issues. And the problem when you don't 444 00:27:34,800 --> 00:27:37,399 Speaker 1: have a function in Congress, it's the executive branch that 445 00:27:37,480 --> 00:27:40,880 Speaker 1: seems to be carrying the lift. And that's not necessarily 446 00:27:41,000 --> 00:27:43,439 Speaker 1: the system of checks and balances that have have served 447 00:27:43,440 --> 00:27:49,120 Speaker 1: this country so well. You have a storied career across 448 00:27:49,119 --> 00:27:53,360 Speaker 1: our military, the second Ranger Battalion, the eighth Infantry Decision 449 00:27:54,000 --> 00:27:57,320 Speaker 1: Division rather the first Armored Division. Maybe it was your 450 00:27:57,320 --> 00:28:01,000 Speaker 1: focus is the Army is exhaust is it appears the 451 00:28:01,080 --> 00:28:04,520 Speaker 1: Navy is with the criticism of these two major naval 452 00:28:04,600 --> 00:28:07,679 Speaker 1: accidents in the Pacific? Can you bring that over to 453 00:28:07,760 --> 00:28:12,160 Speaker 1: our other military branches. Well, first of all, my career 454 00:28:12,200 --> 00:28:14,800 Speaker 1: isn't that story. I've got a hundred guys just like me. 455 00:28:15,560 --> 00:28:18,680 Speaker 1: Having said that, the Army has been fighting continuously since 456 00:28:18,720 --> 00:28:21,520 Speaker 1: two thousand and one, and before that time was spent 457 00:28:22,760 --> 00:28:25,639 Speaker 1: many many years in the Balkans. I don't think the 458 00:28:25,760 --> 00:28:28,480 Speaker 1: personnel are tired as much as the equipment is tired. 459 00:28:29,280 --> 00:28:30,879 Speaker 1: Take a look at the three that you take a 460 00:28:30,880 --> 00:28:33,960 Speaker 1: look at the three major budget categories of the military. 461 00:28:34,000 --> 00:28:38,600 Speaker 1: You've got personnel, operations, in procurement. We're spending a lot 462 00:28:38,640 --> 00:28:41,680 Speaker 1: of money on procurement, which is necessary. We're spending a 463 00:28:41,720 --> 00:28:45,800 Speaker 1: lot of money on personnel, and that's important. What I'm 464 00:28:45,840 --> 00:28:48,360 Speaker 1: concerned about is that the weapons are getting older, but 465 00:28:48,760 --> 00:28:52,880 Speaker 1: being older, our rivals are bringing on new technology better 466 00:28:52,920 --> 00:28:55,880 Speaker 1: than us, and we need to take a hard look 467 00:28:56,080 --> 00:28:58,800 Speaker 1: at the current state of the military and its ability 468 00:28:58,840 --> 00:29:01,600 Speaker 1: to do with the President. I'm gonna say and be polite. 469 00:29:01,640 --> 00:29:04,920 Speaker 1: General thirty nine years ago, not forty, what was your 470 00:29:04,920 --> 00:29:10,200 Speaker 1: first day like a Camp Stanley in Korea? Uh? It 471 00:29:10,320 --> 00:29:14,120 Speaker 1: was interesting because, as you probably remembered just a few 472 00:29:14,120 --> 00:29:16,560 Speaker 1: months prior to that, was the same as accidents event 473 00:29:17,160 --> 00:29:19,440 Speaker 1: where the Americans went in to try to cut down 474 00:29:19,440 --> 00:29:22,440 Speaker 1: a tree inside the the militarized zone, and the North 475 00:29:22,520 --> 00:29:25,640 Speaker 1: Korean guards there took killed a couple of our soldiers 476 00:29:25,680 --> 00:29:28,920 Speaker 1: there and a couple of our officers brutally and without reason. 477 00:29:29,480 --> 00:29:32,480 Speaker 1: So we woke up every morning fully understood that, fully 478 00:29:32,560 --> 00:29:35,280 Speaker 1: understanding that we could be at war the next day. 479 00:29:35,640 --> 00:29:39,440 Speaker 1: And as Stirley Sobery. I've actually been to Camp Stanley 480 00:29:39,480 --> 00:29:43,680 Speaker 1: and looked over the DMZ as were you carrying a weapon? 481 00:29:43,720 --> 00:29:48,479 Speaker 1: Scary of carrying binoculars? It isn't It is a scary 482 00:29:48,520 --> 00:29:53,880 Speaker 1: thought right there when you were there, and from your perspective. Now, 483 00:29:53,920 --> 00:29:58,320 Speaker 1: should we be afraid of North Korea? Or is this 484 00:29:59,080 --> 00:30:05,480 Speaker 1: uh a sort of high stakes diplomatic game. Well, what 485 00:30:05,720 --> 00:30:10,040 Speaker 1: concerns me most more than anything else is the risk 486 00:30:10,080 --> 00:30:13,800 Speaker 1: of miscalculation. Uh. It is not necessarily an issue of 487 00:30:14,000 --> 00:30:17,120 Speaker 1: military versus. The people of America don't need to worry 488 00:30:17,120 --> 00:30:23,440 Speaker 1: about a nuclear war anytime soon. But UM, my personal 489 00:30:23,520 --> 00:30:26,280 Speaker 1: view is I don't think we understand Kim Jong un 490 00:30:26,400 --> 00:30:29,520 Speaker 1: as well as we should, and we may take actions 491 00:30:29,560 --> 00:30:33,160 Speaker 1: that are unnecessarily provocative and caused him to do something 492 00:30:33,240 --> 00:30:44,160 Speaker 1: irrational and irretrievable. What what actions would be irretrievable short 493 00:30:44,160 --> 00:30:48,600 Speaker 1: of obviously dropping a nuclear weapon? But is there is 494 00:30:48,640 --> 00:30:52,480 Speaker 1: there some red line at this point? Well, let's let's 495 00:30:52,480 --> 00:30:56,880 Speaker 1: go back to the fundamentals. This is much like Clint 496 00:30:56,920 --> 00:31:00,920 Speaker 1: Eastwood in Grand Torino. What what Kim alone that's saying 497 00:31:01,160 --> 00:31:05,360 Speaker 1: is get off my lawn. He just wants people to 498 00:31:05,480 --> 00:31:07,800 Speaker 1: leave him alone. He doesn't want to be threatened. He 499 00:31:07,880 --> 00:31:12,280 Speaker 1: doesn't want his regime threatened. He is developing nuclear weapons, 500 00:31:12,320 --> 00:31:15,320 Speaker 1: to my view, for a purely defensive capacity and will 501 00:31:15,360 --> 00:31:19,120 Speaker 1: not give them up. He's seen what happened to leaders 502 00:31:19,200 --> 00:31:23,440 Speaker 1: that gave up the nuclear weapons, like Adafi and Saddam Um, 503 00:31:24,480 --> 00:31:27,720 Speaker 1: both of who did not end up well. He wants 504 00:31:27,760 --> 00:31:30,880 Speaker 1: to keep his party in power. He wants to keep 505 00:31:30,920 --> 00:31:35,680 Speaker 1: his regimes stabilized. He doesn't have a a view of 506 00:31:35,680 --> 00:31:40,680 Speaker 1: taking over the region spreading a revolutionary ideology that this 507 00:31:40,720 --> 00:31:43,400 Speaker 1: is why we call the Hermit Kingdom. He just wants 508 00:31:43,440 --> 00:31:46,880 Speaker 1: to be left alone. Unfortunately, he has a nukes and 509 00:31:46,920 --> 00:31:50,800 Speaker 1: that doesn't give us the option to leave him alone. General, 510 00:31:50,840 --> 00:31:53,360 Speaker 1: thank you so much, General Kimmit with us. It's really 511 00:31:53,760 --> 00:31:55,520 Speaker 1: what we like to do best in surveillance. To have 512 00:31:55,560 --> 00:31:59,000 Speaker 1: Admiral Stevedis and then General Kimmitt with us is important 513 00:31:59,000 --> 00:32:03,080 Speaker 1: perspective as we look to Korea and our other military 514 00:32:03,880 --> 00:32:16,560 Speaker 1: fair Thanks for listening to the Bloomberg Savannas podcast. Subscribe 515 00:32:16,720 --> 00:32:21,640 Speaker 1: and listen to interviews on Apple Podcasts, SoundCloud, or whichever 516 00:32:21,760 --> 00:32:25,480 Speaker 1: podcast platform you prefer. I'm on Twitter at Tom Keene. 517 00:32:25,560 --> 00:32:29,920 Speaker 1: David Gura is at David Gura before the podcast, you 518 00:32:29,960 --> 00:32:33,200 Speaker 1: could always catch us worldwide. I'm Bloomberg Radio.