1 00:00:02,520 --> 00:00:10,119 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,119 --> 00:00:13,880 Speaker 1: Bloomberg Balance of Power podcast. Catch us live weekdays at 3 00:00:13,920 --> 00:00:17,119 Speaker 1: noon and five pm Eastern on Apple, Cocklay and Android 4 00:00:17,160 --> 00:00:20,560 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 5 00:00:20,600 --> 00:00:24,120 Speaker 1: you get your podcasts, or watch us live on YouTube. 6 00:00:25,400 --> 00:00:28,160 Speaker 2: Thank you for being with us on Bloomberg TV and radio. 7 00:00:28,240 --> 00:00:31,080 Speaker 2: Connecting the dots between Washington and Wall Street frequently our 8 00:00:31,160 --> 00:00:33,879 Speaker 2: job today. And there's been a lot of news, specifically 9 00:00:33,880 --> 00:00:37,000 Speaker 2: coming out of the White House that has investors attention. 10 00:00:37,479 --> 00:00:39,639 Speaker 2: We're going to start talking in a moment with Mike 11 00:00:39,720 --> 00:00:42,760 Speaker 2: Shephard about a potential TikTok deal, but it's in fact 12 00:00:43,680 --> 00:00:49,200 Speaker 2: the corporate reporting structure Creedie that has people's attention today. 13 00:00:49,400 --> 00:00:52,919 Speaker 2: Donald Trump on truth Socials, suggesting that companies should only 14 00:00:52,960 --> 00:00:54,600 Speaker 2: have to report twice a year instead of four. 15 00:00:54,720 --> 00:00:56,280 Speaker 3: I mean, this truly is a blast from the past. 16 00:00:56,320 --> 00:00:58,240 Speaker 3: I think it's listening to you in your last hour. 17 00:00:58,320 --> 00:01:01,520 Speaker 3: This is a law from nineteen to thirty where Terris 18 00:01:01,560 --> 00:01:03,960 Speaker 3: were very much in the picture except going in the 19 00:01:04,000 --> 00:01:04,880 Speaker 3: opposite directions. 20 00:01:04,920 --> 00:01:07,399 Speaker 4: I'm curious what prompted the slatest move. 21 00:01:07,480 --> 00:01:10,400 Speaker 2: The idea, of course, transparency. Investors want to have as 22 00:01:10,480 --> 00:01:14,760 Speaker 2: much information as they can, But of course in other cases, 23 00:01:15,400 --> 00:01:18,000 Speaker 2: companies might have a different feel for that. But yes, 24 00:01:18,040 --> 00:01:20,319 Speaker 2: it goes back to a law nineteen thirty four, and 25 00:01:20,360 --> 00:01:23,520 Speaker 2: it's something that Donald Trump already suggested doing. In twenty eighteen, 26 00:01:23,560 --> 00:01:26,160 Speaker 2: the SEC began a review on this that brought us 27 00:01:26,200 --> 00:01:28,840 Speaker 2: to this point now. And Tyler Kendall is watching this 28 00:01:28,959 --> 00:01:31,280 Speaker 2: for us live from the North lawn of the White 29 00:01:31,319 --> 00:01:33,520 Speaker 2: House with the latest on everything coming out of the 30 00:01:33,560 --> 00:01:35,280 Speaker 2: administration today. Tyler, what do we know? 31 00:01:36,200 --> 00:01:37,440 Speaker 5: Yeah, hey, Joe, well you hit it. 32 00:01:37,480 --> 00:01:40,120 Speaker 6: Really the big headline today coming from this post earlier 33 00:01:40,240 --> 00:01:42,720 Speaker 6: this morning am mid eastleu a posts on truth Social 34 00:01:43,000 --> 00:01:45,319 Speaker 6: But the one that caught our attention is President Trump 35 00:01:45,360 --> 00:01:47,800 Speaker 6: saying that the companies shouldn't be forced to deliver these 36 00:01:47,840 --> 00:01:50,880 Speaker 6: earning reports on a quarterly basis, saying he prefers a 37 00:01:50,960 --> 00:01:53,720 Speaker 6: six month schedule. Now, this proposal from the President isn't 38 00:01:53,800 --> 00:01:56,400 Speaker 6: necessarily new. He did float it during his first term 39 00:01:56,720 --> 00:01:59,200 Speaker 6: in twenty eighteen. At the time, there actually was a 40 00:01:59,240 --> 00:02:02,200 Speaker 6: public comment period put forth by the SEC, and our 41 00:02:02,240 --> 00:02:05,400 Speaker 6: analysts point out that market participants actually said that they 42 00:02:05,520 --> 00:02:09,560 Speaker 6: prefer the status quo and ultimately any potential change didn't 43 00:02:09,639 --> 00:02:13,400 Speaker 6: come to fruition. Our analysts at Bloomberg Intelligence, including our 44 00:02:13,480 --> 00:02:15,640 Speaker 6: very own Nathan Dean, say that this does have a 45 00:02:15,800 --> 00:02:18,880 Speaker 6: likelihood though, and potentially could hit the books by twenty 46 00:02:19,000 --> 00:02:21,880 Speaker 6: twenty seven. Just looking at past views from the SEC 47 00:02:22,040 --> 00:02:24,960 Speaker 6: Chair Paul Atkins, this does appear to be something that 48 00:02:24,960 --> 00:02:28,160 Speaker 6: they could be open to, but any change wanted to 49 00:02:28,240 --> 00:02:30,360 Speaker 6: be immediate. And there's sort of two ways that they 50 00:02:30,360 --> 00:02:33,080 Speaker 6: could go about this. One what it could require Congress, 51 00:02:33,160 --> 00:02:36,399 Speaker 6: but the other and probably more logistically feasible option, would 52 00:02:36,440 --> 00:02:38,960 Speaker 6: be that the SEC would have to approve this. They 53 00:02:39,360 --> 00:02:42,680 Speaker 6: currently Republicans currently hold a three to one majority there, 54 00:02:42,720 --> 00:02:45,560 Speaker 6: but this isn't something that President Trump could do unilaterally. 55 00:02:45,680 --> 00:02:48,920 Speaker 6: But I will point out one really important part of 56 00:02:48,960 --> 00:02:51,040 Speaker 6: this post from President Trump, and I know you're going 57 00:02:51,080 --> 00:02:54,120 Speaker 6: to dive into all the developments today later this hour, 58 00:02:54,200 --> 00:02:57,360 Speaker 6: but President Trump tied this to our competition with China, 59 00:02:57,440 --> 00:02:59,440 Speaker 6: and I think perhaps there could be a little bit 60 00:02:59,480 --> 00:03:01,400 Speaker 6: of a timeline question here. 61 00:03:01,480 --> 00:03:02,679 Speaker 5: Of course, President. 62 00:03:02,400 --> 00:03:05,799 Speaker 6: Trump's post coming as those negotiators are in Madrid, and 63 00:03:05,840 --> 00:03:07,440 Speaker 6: it's clearly been on the President's mind. 64 00:03:07,520 --> 00:03:08,160 Speaker 5: Joe and Creedy. 65 00:03:08,160 --> 00:03:11,360 Speaker 6: Of course, another big headline today from those truth Social posts, 66 00:03:11,400 --> 00:03:13,560 Speaker 6: President Trump announcing that he's going to own a phone 67 00:03:13,639 --> 00:03:16,600 Speaker 6: call with the Chinese president Jijingping on Friday. 68 00:03:16,840 --> 00:03:18,320 Speaker 7: Great to know, Tyler, Thank you so much. 69 00:03:18,360 --> 00:03:22,240 Speaker 2: Bloomberg's Tyler Kendall, our Washington correspondent at the White House, 70 00:03:22,240 --> 00:03:25,040 Speaker 2: where we're just starting to see some leaves start to fall. 71 00:03:25,080 --> 00:03:29,080 Speaker 2: I'm Joe Matthew alongside Credi Gupta in Washington, keeping China 72 00:03:29,160 --> 00:03:32,040 Speaker 2: in mind. We've seen a lot of headlines about TikTok, 73 00:03:32,120 --> 00:03:36,000 Speaker 2: the President himself taking to truth Social to talk about 74 00:03:36,080 --> 00:03:39,400 Speaker 2: what could be the framework for a deal here one 75 00:03:39,440 --> 00:03:42,680 Speaker 2: that he was just talking about a short time ago, 76 00:03:42,760 --> 00:03:45,920 Speaker 2: but it was the Treasury Secretary who actually hammered out 77 00:03:45,960 --> 00:03:48,720 Speaker 2: this framework. He's overseas for talks. Let's listen to what 78 00:03:48,760 --> 00:03:50,080 Speaker 2: Scott Besson said this morning. 79 00:03:51,280 --> 00:03:56,520 Speaker 8: We have a framework for a Ticktak deal. The two leaders, 80 00:03:57,480 --> 00:04:02,400 Speaker 8: the President Trump and partner share we'll speak on Friday 81 00:04:02,880 --> 00:04:06,080 Speaker 8: to complete the deal. But we do have a framework 82 00:04:06,840 --> 00:04:08,520 Speaker 8: for a deal with tech Cook. 83 00:04:10,040 --> 00:04:12,120 Speaker 2: Of course, the framework is not a deal, and we 84 00:04:12,160 --> 00:04:14,600 Speaker 2: try to figure out where we should how we should 85 00:04:14,680 --> 00:04:16,080 Speaker 2: define this, and how we should frame this. 86 00:04:16,160 --> 00:04:18,120 Speaker 7: With the help of Michael Shepherd, he's with us in 87 00:04:18,240 --> 00:04:19,119 Speaker 7: Washington as well. 88 00:04:19,320 --> 00:04:22,760 Speaker 2: Bloomberg Senior editor for Technology and Strategic Industry, shep, what 89 00:04:22,800 --> 00:04:24,640 Speaker 2: do we make of this, that's something we haven't talked 90 00:04:24,640 --> 00:04:25,440 Speaker 2: about in a while. 91 00:04:26,040 --> 00:04:27,160 Speaker 7: How would this be valued? 92 00:04:27,400 --> 00:04:29,960 Speaker 2: And presumably the Chinese government would approve of this. 93 00:04:30,200 --> 00:04:33,560 Speaker 9: Well, they would have to approve the technology that Byteedance 94 00:04:33,560 --> 00:04:37,320 Speaker 9: has developed and owned, that is the algorithm software that 95 00:04:37,440 --> 00:04:41,039 Speaker 9: drives the recommendations to users that have made the app 96 00:04:41,160 --> 00:04:45,920 Speaker 9: so appealing and so valuable. That's considered critical technology, and 97 00:04:46,160 --> 00:04:49,320 Speaker 9: leadership in Beijing would have to sign off on any 98 00:04:49,480 --> 00:04:52,320 Speaker 9: such deal. And byte Dance is also viewed as one 99 00:04:52,320 --> 00:04:56,279 Speaker 9: of the national champions of China's tech economy, and so 100 00:04:56,360 --> 00:05:01,360 Speaker 9: therefore any big transaction involving that company and that sensitive 101 00:05:01,400 --> 00:05:05,400 Speaker 9: technology would need to be blessed at a pretty senior level. 102 00:05:05,520 --> 00:05:08,560 Speaker 9: And it is clearly going all the way up to Shijimping, 103 00:05:09,040 --> 00:05:12,600 Speaker 9: with the final details on this framework to be ironed 104 00:05:12,600 --> 00:05:14,239 Speaker 9: out by the two leaders on Friday. 105 00:05:14,640 --> 00:05:17,680 Speaker 3: Let's talk about one of the national champions right here stateside, 106 00:05:17,680 --> 00:05:18,360 Speaker 3: and that's in Nvidia. 107 00:05:18,480 --> 00:05:20,440 Speaker 4: Because on the one hand, we're getting this alive branch. 108 00:05:20,480 --> 00:05:23,320 Speaker 3: It feels like or perhaps progress on the relationship between 109 00:05:23,320 --> 00:05:25,760 Speaker 3: the United States and China. On the other hand, an 110 00:05:25,800 --> 00:05:28,760 Speaker 3: anti trust probe on Nvidio. What do we make of that? 111 00:05:28,880 --> 00:05:31,039 Speaker 9: Well, that is a big two be sure, in this 112 00:05:31,279 --> 00:05:36,080 Speaker 9: broader conversation about trade and the relationship between the US 113 00:05:36,120 --> 00:05:39,000 Speaker 9: and China. That on the one hand, while President Donald 114 00:05:39,040 --> 00:05:42,400 Speaker 9: Trump is getting his wish for an agreement that would 115 00:05:42,440 --> 00:05:47,120 Speaker 9: allow TikTok to continue operating within the US and comply 116 00:05:47,279 --> 00:05:50,600 Speaker 9: with the twenty twenty four law that required to Bite 117 00:05:50,680 --> 00:05:54,599 Speaker 9: Dance to divest itself of those US operations, on the 118 00:05:54,600 --> 00:05:58,840 Speaker 9: other hand, we also have this anti trust probe of Nvidia. 119 00:05:58,839 --> 00:06:02,680 Speaker 9: It's unclear what the consequences of that will be. China 120 00:06:02,720 --> 00:06:06,160 Speaker 9: has not spelled up with the penalties could be for Nvidia, 121 00:06:06,600 --> 00:06:11,160 Speaker 9: what it means in terms of Invidia's ambitions to start 122 00:06:11,200 --> 00:06:15,800 Speaker 9: selling I guess a China specific model of its advanced 123 00:06:15,839 --> 00:06:20,200 Speaker 9: Blackwell AI chip. Remember the US had paused sales of 124 00:06:20,240 --> 00:06:23,159 Speaker 9: the Age twenty from Nvidia. This is the chip that 125 00:06:23,279 --> 00:06:27,200 Speaker 9: was tailor made to comply with previous US restrictions on 126 00:06:27,320 --> 00:06:30,680 Speaker 9: the sales of AI chips to China that have been 127 00:06:30,720 --> 00:06:34,960 Speaker 9: paused by Trump. It more recently was allowed to resume, 128 00:06:35,240 --> 00:06:39,000 Speaker 9: and yet now China has also expressed concerns about that 129 00:06:39,279 --> 00:06:42,120 Speaker 9: accelerator and whether it could be sold in the market. 130 00:06:42,240 --> 00:06:45,320 Speaker 9: So there was a lot of uncertainty surrounding Nvidia's re 131 00:06:45,520 --> 00:06:49,440 Speaker 9: entry into sales of its AI products in the China 132 00:06:49,640 --> 00:06:52,279 Speaker 9: market right now, and that is going to be another 133 00:06:52,480 --> 00:06:55,960 Speaker 9: factor in the talks between she and the president on product. 134 00:06:56,000 --> 00:06:58,279 Speaker 2: You tend to think investors have I hopes for that 135 00:06:58,360 --> 00:07:01,360 Speaker 2: meeting right now. In videos down forty nine cents, It's 136 00:07:01,400 --> 00:07:04,440 Speaker 2: been down fractionally all day. You think baby creaty that 137 00:07:04,520 --> 00:07:07,200 Speaker 2: might have a slightly more meaningful move. We saw bigger 138 00:07:07,240 --> 00:07:09,840 Speaker 2: losses in the pre market. Mike Shepperd, thank you so much. 139 00:07:10,000 --> 00:07:12,720 Speaker 2: Shep as always for the update here as we seek 140 00:07:12,760 --> 00:07:15,960 Speaker 2: insights from Henriette eleven, the senior fellow with the Freeman 141 00:07:16,200 --> 00:07:19,080 Speaker 2: Chair in China Studies at the Center for Strategic and 142 00:07:19,120 --> 00:07:22,160 Speaker 2: International Studies CSIS, is with us right now on Bloomberg 143 00:07:22,240 --> 00:07:25,000 Speaker 2: TV and Radio. Henrietta, thanks for joining us as we 144 00:07:25,000 --> 00:07:28,840 Speaker 2: look back at Donald Trump's post on truth Social about China. 145 00:07:28,880 --> 00:07:31,480 Speaker 2: He says the big trade meeting in Europe between the 146 00:07:31,640 --> 00:07:35,640 Speaker 2: US and China has gone very well. He talks about 147 00:07:35,680 --> 00:07:38,640 Speaker 2: the TikTok deal in here without actually mentioning the company. 148 00:07:38,640 --> 00:07:40,760 Speaker 2: He says, a company young people in our country will 149 00:07:40,960 --> 00:07:44,480 Speaker 2: very much want to save. And he says the relationship 150 00:07:44,880 --> 00:07:48,320 Speaker 2: between the US and China remains a very strong one. 151 00:07:49,320 --> 00:07:50,240 Speaker 2: Is that how you see it. 152 00:07:52,560 --> 00:07:56,480 Speaker 5: I may see a little more, let's say, dynamism in 153 00:07:56,560 --> 00:08:00,640 Speaker 5: the US China relationship over strength. But thank you so 154 00:08:00,720 --> 00:08:03,920 Speaker 5: much for having me. I think it is interesting. I mean, 155 00:08:04,000 --> 00:08:07,240 Speaker 5: even when we think about how a Secretary vessent described 156 00:08:07,360 --> 00:08:10,640 Speaker 5: exactly those trade talks. He seemed to say they didn't 157 00:08:10,640 --> 00:08:13,240 Speaker 5: talk much about trade, that this was mostly about this 158 00:08:13,320 --> 00:08:18,280 Speaker 5: TikTok framework deal. And even that alone speaks to I 159 00:08:18,280 --> 00:08:21,000 Speaker 5: think some of the significant obstacles that stand in the 160 00:08:21,040 --> 00:08:23,120 Speaker 5: way of a more stable US China relationship. 161 00:08:24,680 --> 00:08:28,840 Speaker 3: Henrietta Shinwi, a Chinese newspaper, had put out the idea 162 00:08:28,880 --> 00:08:32,360 Speaker 3: that part of those trade negotiations was bringing down barriers 163 00:08:32,360 --> 00:08:34,760 Speaker 3: of investment to Chinese investors. 164 00:08:34,840 --> 00:08:37,959 Speaker 4: Is the United States ready for more Chinese investment? 165 00:08:38,000 --> 00:08:38,080 Speaker 5: What? 166 00:08:38,080 --> 00:08:40,080 Speaker 4: It's been such a sticking point up till now. 167 00:08:40,840 --> 00:08:45,200 Speaker 5: Well. President Trump has expressed strong opposition and support for 168 00:08:45,480 --> 00:08:49,600 Speaker 5: Chinese investment in the United States, at some times seeming 169 00:08:49,640 --> 00:08:52,960 Speaker 5: to encourage Chinese investment, and at other times describing it 170 00:08:53,000 --> 00:08:56,280 Speaker 5: as a national security risk. And so I think that's 171 00:08:56,320 --> 00:08:59,719 Speaker 5: part of why we're all watching so closely what this 172 00:09:00,400 --> 00:09:03,560 Speaker 5: between President She and President Trump that Secretary Besant promised 173 00:09:03,600 --> 00:09:06,720 Speaker 5: on Friday, if it happens, the Chinese have not confirmed it, 174 00:09:06,760 --> 00:09:09,360 Speaker 5: but if it happens, that will be a very significant 175 00:09:09,360 --> 00:09:13,880 Speaker 5: moment in the relationship, because clearly Trump's mood, his perspective 176 00:09:13,960 --> 00:09:17,640 Speaker 5: on his personal relationship, which she can make a big 177 00:09:17,679 --> 00:09:21,800 Speaker 5: difference in which direction he chooses to go among these 178 00:09:22,559 --> 00:09:27,080 Speaker 5: somewhat conflicting China strategies that he seems to be pursuing. 179 00:09:27,320 --> 00:09:28,240 Speaker 5: Sometimes at the same. 180 00:09:28,080 --> 00:09:32,760 Speaker 2: Time, Well, I'm confused, Henrietta, because there was another truth 181 00:09:32,840 --> 00:09:36,560 Speaker 2: post from just two days ago in which the President 182 00:09:36,559 --> 00:09:39,440 Speaker 2: of the United States called on European nations to stop 183 00:09:39,480 --> 00:09:41,720 Speaker 2: buying oil from Russia. He says he's going to hold 184 00:09:41,720 --> 00:09:46,200 Speaker 2: off on secondary sanctions until then, and in that same post, 185 00:09:46,240 --> 00:09:48,520 Speaker 2: he says, I believe this, plus NATO as a group 186 00:09:49,040 --> 00:09:52,120 Speaker 2: placing fifty to one hundred percent tariffs on China to 187 00:09:52,160 --> 00:09:55,320 Speaker 2: be fully withdrawn after the war with Russia and Ukraine 188 00:09:55,320 --> 00:09:58,040 Speaker 2: has ended, will also be a great help in ending 189 00:09:58,080 --> 00:10:01,440 Speaker 2: this deadly but ridiculous war. He goes on to say 190 00:10:01,520 --> 00:10:05,120 Speaker 2: China has strong control, even grip over Russia, and these 191 00:10:05,160 --> 00:10:10,160 Speaker 2: powerful tariffs will break that grip. Which side of his 192 00:10:10,280 --> 00:10:13,079 Speaker 2: mouth is he talking out of here? When he prepares 193 00:10:13,880 --> 00:10:16,439 Speaker 2: to talk with President Shei on Friday. You can't have both, 194 00:10:16,520 --> 00:10:16,800 Speaker 2: can you. 195 00:10:18,320 --> 00:10:21,600 Speaker 5: It's a very difficult needle to thread. It is good 196 00:10:21,600 --> 00:10:26,400 Speaker 5: to hear President Trump raising concerns about China's decisive role 197 00:10:26,840 --> 00:10:30,000 Speaker 5: in Russia's ability to continue fighting the war in Ukraine, 198 00:10:30,000 --> 00:10:36,000 Speaker 5: and China's systematic support for Russia in terms of financial support, 199 00:10:36,120 --> 00:10:41,079 Speaker 5: evading US sanctions, economic support. It's support for the Russian 200 00:10:41,120 --> 00:10:45,120 Speaker 5: military as well. I mean, this is what Putin needs 201 00:10:45,320 --> 00:10:49,400 Speaker 5: to continue replenishing his forces when he takes battlefield losses, 202 00:10:50,160 --> 00:10:53,040 Speaker 5: and so it's an important issue. It's hard to know 203 00:10:53,440 --> 00:10:56,920 Speaker 5: whether President Trump is making a serious push in the 204 00:10:56,960 --> 00:10:59,800 Speaker 5: G seven on this. I tend to think if you 205 00:10:59,800 --> 00:11:03,280 Speaker 5: would serious, he'd be talking about financial sanctions, especially on 206 00:11:03,400 --> 00:11:06,000 Speaker 5: Chinese banks measures. The Europeans have already started to move 207 00:11:06,040 --> 00:11:09,640 Speaker 5: ahead with those banks that are responsible for actually processing 208 00:11:09,679 --> 00:11:12,679 Speaker 5: the transactions that allow Chinese goods to get to the 209 00:11:12,760 --> 00:11:15,200 Speaker 5: Russian military. I think that would be a really important step. 210 00:11:15,559 --> 00:11:18,760 Speaker 5: I worry that this talk about tariffs may not be serious. 211 00:11:18,760 --> 00:11:21,800 Speaker 5: It may be intended more as short term leverage in 212 00:11:21,840 --> 00:11:24,680 Speaker 5: Trump's effort to get a better deal with China on 213 00:11:24,760 --> 00:11:28,760 Speaker 5: unrelated issues. We've seen the US is unable to sustain 214 00:11:29,120 --> 00:11:32,439 Speaker 5: very high levels of tariffs on China, in part because 215 00:11:32,559 --> 00:11:37,360 Speaker 5: China has so effectively retaliated with the choke points on 216 00:11:37,679 --> 00:11:40,640 Speaker 5: rare earth exports, and so it's difficult to see how 217 00:11:40,640 --> 00:11:43,440 Speaker 5: this would play out differently now that we're having the 218 00:11:43,440 --> 00:11:45,680 Speaker 5: conversation in a G seven context. 219 00:11:46,760 --> 00:11:48,600 Speaker 3: Henriette, I love that you hit that, because it feels 220 00:11:48,640 --> 00:11:51,280 Speaker 3: like one of the big narratives as well swirling around 221 00:11:51,400 --> 00:11:55,560 Speaker 3: is that China has been preparing for this reality for months, years, 222 00:11:55,600 --> 00:11:59,280 Speaker 3: if not decades, of kind of weaning themselves off economically 223 00:11:59,720 --> 00:12:03,720 Speaker 3: of the American consumer. Ultimately, is China in a position 224 00:12:04,240 --> 00:12:07,760 Speaker 3: where they can digest and continued operate with one hundred 225 00:12:07,760 --> 00:12:10,520 Speaker 3: percent tariffs placed on them by President Trump. 226 00:12:12,240 --> 00:12:14,679 Speaker 5: I think that China is making the bet, they may 227 00:12:14,679 --> 00:12:18,800 Speaker 5: be right, that they can last longer if Trump moves 228 00:12:18,800 --> 00:12:21,880 Speaker 5: ahead with one hundred percent tariffs, China retaliates with its 229 00:12:21,920 --> 00:12:24,960 Speaker 5: own equal tariff rate as well as we have to 230 00:12:25,000 --> 00:12:28,400 Speaker 5: assume another round of restrictions on the export of rare 231 00:12:28,440 --> 00:12:33,079 Speaker 5: earth magnets orarth materials. China thinks that they will hurt. 232 00:12:33,360 --> 00:12:36,280 Speaker 5: They will take economic losses, but they'll take less than 233 00:12:36,320 --> 00:12:39,440 Speaker 5: the US. And they think that politically they can absorb 234 00:12:39,520 --> 00:12:42,880 Speaker 5: those losses longer and better than America can, and so 235 00:12:43,000 --> 00:12:45,400 Speaker 5: they feel like they have the upper hand in any 236 00:12:45,440 --> 00:12:47,120 Speaker 5: of these conversations around tariffs. 237 00:12:48,240 --> 00:12:51,720 Speaker 2: Assuming this meeting takes place on Friday, how low should 238 00:12:51,720 --> 00:12:52,880 Speaker 2: our expectations be? 239 00:12:54,160 --> 00:12:58,920 Speaker 5: Always low, But it's still important whenever the leader of 240 00:12:58,960 --> 00:13:01,440 Speaker 5: the United States and China to speak, that's an important 241 00:13:01,440 --> 00:13:05,840 Speaker 5: moment in the relationship, especially now that President Trump has 242 00:13:05,880 --> 00:13:09,640 Speaker 5: taken such a personalized approach to US China relations, and 243 00:13:09,679 --> 00:13:13,560 Speaker 5: of course President She, for his part, has assumed an 244 00:13:13,640 --> 00:13:16,960 Speaker 5: unprecedented degree of power within the Chinese political system. So 245 00:13:16,960 --> 00:13:20,000 Speaker 5: it's important that they talk. Looking at it will also 246 00:13:20,040 --> 00:13:24,040 Speaker 5: be interesting to see how they both describe what was discussed. 247 00:13:24,320 --> 00:13:27,320 Speaker 5: We remember the last time Trump and She spoke, the 248 00:13:27,400 --> 00:13:30,280 Speaker 5: readouts from the two sides looked like they were referring 249 00:13:30,320 --> 00:13:33,520 Speaker 5: to totally different conversations. And so that said to me 250 00:13:33,760 --> 00:13:36,240 Speaker 5: that even though you know, it's good that they're talking, 251 00:13:36,360 --> 00:13:39,920 Speaker 5: if they don't agree what they're talking about that itself 252 00:13:39,960 --> 00:13:42,000 Speaker 5: can become a point of tension down the line in 253 00:13:42,040 --> 00:13:42,760 Speaker 5: the relationship. 254 00:13:43,960 --> 00:13:45,160 Speaker 7: Really great to have you with us. 255 00:13:45,200 --> 00:13:50,000 Speaker 2: Henriette eleven, Senior fellow Freeman Shair in China studies at CSIS. 256 00:13:50,600 --> 00:13:52,880 Speaker 7: Don't be a stranger. We appreciate your view. 257 00:13:52,880 --> 00:13:56,600 Speaker 2: I'm Joe Matthew alongside Credie Gupta in Washington as we 258 00:13:56,720 --> 00:13:59,480 Speaker 2: unpack the weekend and a very busy morning for the 259 00:13:59,520 --> 00:14:02,719 Speaker 2: President on social media. Much more to follow with our 260 00:14:02,720 --> 00:14:05,319 Speaker 2: political panels. Stay with us on Balance of Power. We'll 261 00:14:05,360 --> 00:14:06,920 Speaker 2: have much more coming up after this. 262 00:14:12,360 --> 00:14:15,840 Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch 263 00:14:15,880 --> 00:14:18,880 Speaker 1: us live weekdays at noon and five pm Eastern on 264 00:14:19,040 --> 00:14:22,280 Speaker 1: Apple Coarckley and Android Auto with the Bloomberg Business App. 265 00:14:22,440 --> 00:14:25,680 Speaker 1: Listen on demand wherever you get your podcasts, or watch 266 00:14:25,800 --> 00:14:27,320 Speaker 1: us live on YouTube. 267 00:14:28,480 --> 00:14:31,240 Speaker 2: We keep our attention focused on the great city of 268 00:14:31,280 --> 00:14:33,760 Speaker 2: New York, where Charlie Pellett is, and we'll get back 269 00:14:33,760 --> 00:14:35,480 Speaker 2: to Charlie round one o'clock top of the hour. 270 00:14:35,520 --> 00:14:38,160 Speaker 7: Here for another update on Wall Street. New York. 271 00:14:38,240 --> 00:14:43,000 Speaker 2: Politics have captivated Washington. The President talks about it just 272 00:14:43,040 --> 00:14:46,960 Speaker 2: about every day. The mayoral race, specifically referencing the communist, 273 00:14:47,040 --> 00:14:49,440 Speaker 2: as he likes to say, who could become the next 274 00:14:49,480 --> 00:14:51,880 Speaker 2: mayor of New York. That's why Donald Trump has become 275 00:14:51,960 --> 00:14:55,680 Speaker 2: personally involved in the race, according to reports, urging a 276 00:14:55,720 --> 00:14:59,040 Speaker 2: couple of candidates, including the Republican Curtis Sleewer, to drop 277 00:14:59,080 --> 00:15:03,160 Speaker 2: out so Andrew Cuomo can have a better chance. And 278 00:15:03,240 --> 00:15:05,600 Speaker 2: polling data would suggest that he's right, would have a 279 00:15:05,680 --> 00:15:09,800 Speaker 2: better chance than a one on one against Zoron Mam Donnie. 280 00:15:09,840 --> 00:15:13,800 Speaker 2: That job may have just become more difficult with two 281 00:15:13,840 --> 00:15:19,760 Speaker 2: pretty important endorsements. Of course, Mam Donnie is a democratic socialist, 282 00:15:19,840 --> 00:15:22,920 Speaker 2: not a communist, and he could be a little more 283 00:15:22,960 --> 00:15:25,560 Speaker 2: mainstream by the end of the day. Here when everybody 284 00:15:25,600 --> 00:15:28,640 Speaker 2: hears about this, the Governor of New York has jumped 285 00:15:28,640 --> 00:15:34,160 Speaker 2: off the fence. Yes, Kathy Hokel endorsing mister Mamdani for 286 00:15:34,320 --> 00:15:38,920 Speaker 2: mayor of New York City, following months of questioning on 287 00:15:39,080 --> 00:15:42,040 Speaker 2: this and not bad here it is right in front 288 00:15:42,040 --> 00:15:44,200 Speaker 2: of me here in the New York Times. A guest essay, 289 00:15:44,240 --> 00:15:48,200 Speaker 2: I should call it, Kathy Hokel, Why I am endorsing 290 00:15:48,600 --> 00:15:52,840 Speaker 2: zoron Mam Donni In the past few months, she says, 291 00:15:52,840 --> 00:15:56,080 Speaker 2: I've had Frank conversations with him. We've had our disagreements, 292 00:15:56,600 --> 00:15:59,000 Speaker 2: but in our conversations, I've heard a leader who shares 293 00:15:59,000 --> 00:16:02,000 Speaker 2: my commitment to a New York where children can grow 294 00:16:02,080 --> 00:16:06,360 Speaker 2: up safe in their neighborhoods, and where opportunities within reach 295 00:16:06,440 --> 00:16:09,320 Speaker 2: for every family. I heard a leader, she says, who 296 00:16:09,400 --> 00:16:12,880 Speaker 2: is focused on making New York City affordable, a goal 297 00:16:13,000 --> 00:16:19,120 Speaker 2: I enthusiastically support this piece of writing. This important endorsement 298 00:16:20,160 --> 00:16:23,760 Speaker 2: follows some pretty tough talk and an endorsement as well 299 00:16:23,800 --> 00:16:26,240 Speaker 2: from Senator Chris van Holland, the Democrat from Maryland. You've 300 00:16:26,240 --> 00:16:29,440 Speaker 2: heard from him on this program before, speaking at a 301 00:16:29,480 --> 00:16:32,560 Speaker 2: Democratic fundraiser in Iowa on Saturday night. 302 00:16:32,640 --> 00:16:34,360 Speaker 7: Let's listen to mister van Holland. 303 00:16:34,520 --> 00:16:38,080 Speaker 10: It means supporting our Democratic nominee in New York City's 304 00:16:38,120 --> 00:16:47,360 Speaker 10: mayoral race, Zoran Mondmion. He is focused on ensuring that 305 00:16:47,440 --> 00:16:50,480 Speaker 10: people can afford to live in the place that they work. 306 00:16:50,640 --> 00:16:54,360 Speaker 10: Donald Trump and New York's financial elite see that is 307 00:16:54,360 --> 00:16:58,400 Speaker 10: a threat. Yet many Democratic members of the Senate and 308 00:16:58,560 --> 00:17:01,200 Speaker 10: House or any New York. 309 00:17:01,320 --> 00:17:02,960 Speaker 7: Have stayed on the sidelines. 310 00:17:04,000 --> 00:17:07,679 Speaker 10: That kind of spineless politics is what people are sick of. 311 00:17:08,440 --> 00:17:11,080 Speaker 7: They need to get behind him. And get behind him. 312 00:17:10,920 --> 00:17:16,080 Speaker 2: Now, spineless politics. Did he talk to HAKEM Jeffries before 313 00:17:16,119 --> 00:17:19,639 Speaker 2: that speech? Maybe got a phone call from him after 314 00:17:21,800 --> 00:17:24,080 Speaker 2: he says the Democratic Party is not going to fix 315 00:17:24,160 --> 00:17:27,960 Speaker 2: itself and to shape its future need to start winning 316 00:17:28,040 --> 00:17:31,080 Speaker 2: races like this one. That's where we start with our 317 00:17:31,119 --> 00:17:34,359 Speaker 2: political panel. Genie Shanzano is with us. I'm sure Jeanie 318 00:17:34,400 --> 00:17:38,160 Speaker 2: has thoughts. Bloomberg Politics contributor, our Democratic analyst and democracy 319 00:17:38,280 --> 00:17:42,920 Speaker 2: visiting fellow at Harvard Kennedy's School Ash Center. Mora Gillespie 320 00:17:43,040 --> 00:17:47,639 Speaker 2: is with us too, Republican strategist, founder Bluestack Strategies and 321 00:17:47,720 --> 00:17:50,920 Speaker 2: a veteran of John Bayner's Speaker's office. Great to see 322 00:17:50,920 --> 00:17:55,439 Speaker 2: you both here. Genie is Chris van Holland Wright. Forget 323 00:17:55,440 --> 00:17:57,919 Speaker 2: the Democratic Party isn't going to fix itself? Is this 324 00:17:58,000 --> 00:18:01,159 Speaker 2: spineless politics? People waiting around on mom Donnie? 325 00:18:03,160 --> 00:18:05,879 Speaker 11: Yeah, And you saw Jefferies hit him back by saying 326 00:18:05,920 --> 00:18:08,920 Speaker 11: New Yorkers are asking Chris vin who, which is probably 327 00:18:08,920 --> 00:18:13,200 Speaker 11: not fair either. All the while Donald Trump calling Mundanni 328 00:18:13,400 --> 00:18:16,320 Speaker 11: little communist, which Joe I was going to ask you 329 00:18:16,359 --> 00:18:19,720 Speaker 11: about because it's not little, it's little with two d's, 330 00:18:19,760 --> 00:18:22,840 Speaker 11: and it confused me enormously, as I'm not a great 331 00:18:22,880 --> 00:18:26,919 Speaker 11: interpreter of his truth posts, but you know, there is 332 00:18:26,920 --> 00:18:29,359 Speaker 11: a huge divide obviously in the Democratic Party. 333 00:18:29,960 --> 00:18:33,160 Speaker 12: This huge primary win by Zoran Mundani in New. 334 00:18:33,160 --> 00:18:37,320 Speaker 11: York has really exacerbated that this is all happening while 335 00:18:37,320 --> 00:18:40,280 Speaker 11: we've got Joe Mansion in Kamala Harris out with two books, 336 00:18:40,280 --> 00:18:43,920 Speaker 11: We've got the Progressives meeting in Annapolis. The Democrats are 337 00:18:43,960 --> 00:18:45,960 Speaker 11: trying to figure out who they are going to be 338 00:18:46,080 --> 00:18:50,040 Speaker 11: going forward into this midterm, and Chris vin Holland. 339 00:18:49,800 --> 00:18:50,840 Speaker 12: Is out in Iowa. 340 00:18:51,400 --> 00:18:53,840 Speaker 11: I think he thinks maybe the caucust will happen again 341 00:18:53,880 --> 00:18:58,199 Speaker 11: out there, because he has been very clear that he has, 342 00:18:58,320 --> 00:19:01,359 Speaker 11: you know, and maybe an interest to pursuing higher office 343 00:19:01,440 --> 00:19:04,040 Speaker 11: or certainly having a role in that. And he is 344 00:19:04,160 --> 00:19:07,399 Speaker 11: taking his claim, as you know, a traditional moderate, on 345 00:19:07,600 --> 00:19:10,879 Speaker 11: the fact that Democrats need to wake up and recognize 346 00:19:11,000 --> 00:19:13,400 Speaker 11: that all of the energy in the Democratic Party right 347 00:19:13,400 --> 00:19:16,520 Speaker 11: now is on the progressive side. And of course Kathy 348 00:19:16,600 --> 00:19:19,479 Speaker 11: Hochel has woken up to that as well, you know, 349 00:19:19,840 --> 00:19:23,160 Speaker 11: coming in at this last moment, not particular explaining why 350 00:19:23,240 --> 00:19:26,360 Speaker 11: she waited so long, but saying, you know what, this 351 00:19:26,359 --> 00:19:28,879 Speaker 11: guy's going to win. You know, just like Donald Trump, 352 00:19:28,920 --> 00:19:31,160 Speaker 11: these folks can read the polls, and the polls say, 353 00:19:31,440 --> 00:19:34,320 Speaker 11: if this is a four man race going forward, Mom, 354 00:19:34,520 --> 00:19:36,600 Speaker 11: Donnie is going to sweep it. I mean he even 355 00:19:36,720 --> 00:19:40,639 Speaker 11: won Jeffrey's district by like twelve points. So they can 356 00:19:40,720 --> 00:19:43,120 Speaker 11: read the tea leave they know that they should push 357 00:19:43,160 --> 00:19:45,879 Speaker 11: forward on this. At this point, I think the question 358 00:19:46,040 --> 00:19:49,520 Speaker 11: is does it really make it difficult now for Jeffries 359 00:19:49,560 --> 00:19:51,720 Speaker 11: Schumer and other leading. 360 00:19:51,480 --> 00:19:54,640 Speaker 12: New Yorkers on the Democratic side who have not endorsed. 361 00:19:54,640 --> 00:19:59,000 Speaker 2: To Van Hollins's point, Donald Trump on truth social To 362 00:19:59,119 --> 00:20:02,920 Speaker 2: Genie's point, Governor Kathy Hochel of New York has endorsed 363 00:20:03,000 --> 00:20:08,679 Speaker 2: the Little Communist l I Ddlee apostrophe. I didn't get 364 00:20:08,680 --> 00:20:13,160 Speaker 2: the apostrophe zoron Mamdannie running for mayor of New York. 365 00:20:13,200 --> 00:20:15,679 Speaker 2: This is a rather shocking development, he says, and a 366 00:20:15,760 --> 00:20:17,760 Speaker 2: very bad one for New York City. How can such 367 00:20:17,760 --> 00:20:21,800 Speaker 2: a thing happen? Washington will be watching this situation very closely. 368 00:20:21,920 --> 00:20:24,840 Speaker 2: No reason to be sending good money after bad, I guess, 369 00:20:24,880 --> 00:20:28,600 Speaker 2: implying that federal funding for New York City or for 370 00:20:28,680 --> 00:20:31,760 Speaker 2: the state might be at risk. Mara, how are you 371 00:20:31,840 --> 00:20:35,760 Speaker 2: reading this because Donald Trump. I still have a hard 372 00:20:35,800 --> 00:20:39,760 Speaker 2: time thinking that Donald Trump wouldn't love Zorhon Mam Donnie 373 00:20:39,800 --> 00:20:41,480 Speaker 2: to be the mayor of New York. It would be 374 00:20:41,520 --> 00:20:44,560 Speaker 2: a guaranteed foil for the rest of his term. 375 00:20:46,200 --> 00:20:48,560 Speaker 13: It's a little surprising given the fact that I equate 376 00:20:48,560 --> 00:20:51,960 Speaker 13: what's happening in the Democratic Party under this Zoron Mundani 377 00:20:52,080 --> 00:20:54,600 Speaker 13: to be what happened to the Republicans when Donald Trump 378 00:20:54,720 --> 00:20:57,760 Speaker 13: entered the race, when he decided to enter a Republican politics, right, 379 00:20:57,840 --> 00:20:59,320 Speaker 13: I mean, it's a real shake up, and it's a 380 00:20:59,359 --> 00:21:01,879 Speaker 13: decision for members to take a look and say, do 381 00:21:01,920 --> 00:21:05,200 Speaker 13: I want to align myself with the unknown of Mandami 382 00:21:05,359 --> 00:21:07,840 Speaker 13: and with questionable things that he has said and done 383 00:21:07,840 --> 00:21:10,720 Speaker 13: and things that you know, he hasn't really defended very well. 384 00:21:11,520 --> 00:21:13,879 Speaker 13: But do I see that as my political future? Kathy 385 00:21:13,920 --> 00:21:16,760 Speaker 13: Hchel certainly does. Chrispin Hollands certainly does, and they've decided 386 00:21:16,800 --> 00:21:19,320 Speaker 13: to double down with him. Kathi Hochel is looking at 387 00:21:19,359 --> 00:21:21,280 Speaker 13: her own reelection and even though just a matter of 388 00:21:21,320 --> 00:21:24,320 Speaker 13: weeks ago, maybe even less, she said that it didn't 389 00:21:24,359 --> 00:21:27,320 Speaker 13: really you know, when asked about giving an endorsement, she says, well, 390 00:21:27,320 --> 00:21:29,400 Speaker 13: it doesn't you know, I represent all of New York. 391 00:21:29,440 --> 00:21:31,919 Speaker 13: You know, I'm not even voting in that one, referring 392 00:21:31,920 --> 00:21:34,080 Speaker 13: to the mayoral race in York City. So she brushed 393 00:21:34,080 --> 00:21:37,360 Speaker 13: it off pretty saying pretty, you know, clearly brushed it off. 394 00:21:37,400 --> 00:21:39,240 Speaker 13: But now here she is with this piece coming out 395 00:21:39,680 --> 00:21:42,920 Speaker 13: because she realizes it's tied to her own reelection, especially 396 00:21:42,920 --> 00:21:47,400 Speaker 13: if Adams is out and Trump puts his mamma behind Cuomo. 397 00:21:47,560 --> 00:21:51,680 Speaker 13: So it's just very telling to me about how Democrats 398 00:21:51,720 --> 00:21:53,679 Speaker 13: decide to either take the case of what happened with 399 00:21:53,680 --> 00:21:57,520 Speaker 13: Republicans under Trump, you know, as a cast Sharry tale, 400 00:21:57,640 --> 00:21:59,479 Speaker 13: or if they can, if they're going to dive in 401 00:21:59,680 --> 00:22:01,600 Speaker 13: and doubled down with him. 402 00:22:01,880 --> 00:22:03,600 Speaker 7: What are you thinking about this, Genie. 403 00:22:03,600 --> 00:22:06,920 Speaker 2: That's really interesting, Mora, and not the comparison I would 404 00:22:06,920 --> 00:22:07,520 Speaker 2: have expected. 405 00:22:07,520 --> 00:22:07,920 Speaker 7: Today. 406 00:22:09,000 --> 00:22:15,639 Speaker 2: You pointed out the statement from Hakim Jeffries spokesman Justin 407 00:22:15,680 --> 00:22:18,240 Speaker 2: Tchurmol leader Jeffries will lot more to say says about 408 00:22:18,280 --> 00:22:21,880 Speaker 2: the general election well in advance of November fourth. Meanwhile, 409 00:22:21,920 --> 00:22:25,720 Speaker 2: confuse New Yorkers are asking themselves this question, Chris Van 410 00:22:25,840 --> 00:22:32,439 Speaker 2: who is this an inflection point for the Democratic Party, Jeanie, 411 00:22:32,520 --> 00:22:37,040 Speaker 2: the way Mora is describing it, Yeah, out that was tough. 412 00:22:38,119 --> 00:22:41,320 Speaker 12: You know, I think she's I agree with Maura. 413 00:22:41,520 --> 00:22:44,920 Speaker 11: I would go back even further at the national level 414 00:22:44,960 --> 00:22:47,640 Speaker 11: and say it's a bit like the choice Democrats had 415 00:22:47,680 --> 00:22:52,359 Speaker 11: between Hillary Clinton and Barack Obama when the establishment was 416 00:22:52,440 --> 00:22:55,760 Speaker 11: much more behind Hillary Clinton in o Wait and Barack 417 00:22:55,800 --> 00:22:58,520 Speaker 11: Obama seemed to come out of nowhere to many people 418 00:22:58,560 --> 00:23:01,840 Speaker 11: and had a lot of energy. And whether you like 419 00:23:01,960 --> 00:23:06,440 Speaker 11: Mumdani or not, he is a fabulous communicator. He's young, 420 00:23:06,560 --> 00:23:10,200 Speaker 11: he's energetic, he really has his finger on the pulse 421 00:23:10,240 --> 00:23:15,240 Speaker 11: to Morrow's point of what particularly progressive New Yorkers and 422 00:23:15,560 --> 00:23:19,680 Speaker 11: progressive Democrats, I should say, around the country feel, And 423 00:23:20,040 --> 00:23:23,679 Speaker 11: he communicates in a way that you know Andrew Cmo 424 00:23:23,840 --> 00:23:25,080 Speaker 11: doesn't and never would. 425 00:23:25,119 --> 00:23:27,560 Speaker 12: And so you know, there's a lot of reasons. I 426 00:23:27,600 --> 00:23:30,080 Speaker 12: think Donald Trump not to mention. 427 00:23:29,960 --> 00:23:32,000 Speaker 11: The fact he has a long relationship with Cuomo, but 428 00:23:32,480 --> 00:23:36,240 Speaker 11: he really may be looking at Mumdanni as something of 429 00:23:36,280 --> 00:23:39,159 Speaker 11: a threat in a different way. You know, I'm not 430 00:23:39,240 --> 00:23:41,000 Speaker 11: sure this is going to be the be all or 431 00:23:41,160 --> 00:23:43,600 Speaker 11: end all of the Democratic Party where they choose who 432 00:23:43,600 --> 00:23:44,320 Speaker 11: they line up with. 433 00:23:44,440 --> 00:23:47,600 Speaker 12: But of course this is the largest city in the. 434 00:23:47,560 --> 00:23:51,400 Speaker 11: Country by far. It is a hugely. I think one 435 00:23:51,400 --> 00:23:53,040 Speaker 11: of the best cities in the country. And I'm of 436 00:23:53,080 --> 00:23:57,119 Speaker 11: course biased, and we always watch this election to see 437 00:23:57,240 --> 00:23:59,960 Speaker 11: what it portends for going forward in the mid term 438 00:24:00,240 --> 00:24:04,240 Speaker 11: and the national cycle. And Democrats have to figure out 439 00:24:04,560 --> 00:24:09,000 Speaker 11: how they are going to confront this very aggressive Republican party, 440 00:24:09,240 --> 00:24:12,080 Speaker 11: and after what's happened with Charlie Kirk, I think this 441 00:24:12,200 --> 00:24:15,439 Speaker 11: is coming to be even more important. And you know, 442 00:24:15,720 --> 00:24:20,120 Speaker 11: I'm not saying vocals adorsement was tied to the Kirk issue, 443 00:24:20,240 --> 00:24:23,280 Speaker 11: but so many Democrats are asking, now, where do we 444 00:24:23,359 --> 00:24:26,240 Speaker 11: go from here? And I think people do feel like 445 00:24:26,400 --> 00:24:29,560 Speaker 11: they have to choose a direction, and Mom Dannie is 446 00:24:29,600 --> 00:24:33,159 Speaker 11: offering a new direction and that's very attractive to people 447 00:24:33,440 --> 00:24:36,680 Speaker 11: focused primarily by the way, on economic issues, which is 448 00:24:36,720 --> 00:24:37,520 Speaker 11: a huge concern. 449 00:24:38,720 --> 00:24:41,600 Speaker 2: Mari, you worked for a Speaker of the House at 450 00:24:41,640 --> 00:24:43,720 Speaker 2: a very different time and of course a different party. 451 00:24:43,760 --> 00:24:47,480 Speaker 2: You work for Republican Speaker John Bayinner. But what do 452 00:24:47,520 --> 00:24:50,080 Speaker 2: you make of this reaction from the man who wants 453 00:24:50,119 --> 00:24:53,000 Speaker 2: to be speaker, Hakeem Jeffreys being called out by a 454 00:24:53,040 --> 00:24:55,800 Speaker 2: senator like this is this part for the course? You know, 455 00:24:55,840 --> 00:24:58,480 Speaker 2: you kind of thumb your nose at somebody from the 456 00:24:58,560 --> 00:25:03,720 Speaker 2: Upper Chamber, or should Jeffries reconsider the state of the 457 00:25:03,840 --> 00:25:07,040 Speaker 2: National Democratic Party here and be careful with his words. 458 00:25:08,480 --> 00:25:10,280 Speaker 13: I think it's a little poor form, you know. I 459 00:25:10,280 --> 00:25:12,560 Speaker 13: think I would hope that Chris van Holland would have 460 00:25:12,560 --> 00:25:15,440 Speaker 13: had a conversation with hickem Jeffries, but it doesn't seem 461 00:25:15,440 --> 00:25:18,440 Speaker 13: as if that happened. I think that obviously, with my 462 00:25:18,600 --> 00:25:22,800 Speaker 13: experience with working for John Bayner, the best approach is 463 00:25:22,840 --> 00:25:25,520 Speaker 13: to handle things in house and to deal with it 464 00:25:25,560 --> 00:25:28,840 Speaker 13: internally with the godfather role, you know, you keep it 465 00:25:28,880 --> 00:25:32,040 Speaker 13: in the family. And so I always think that's a 466 00:25:32,040 --> 00:25:34,480 Speaker 13: better policy to go by because it just makes everyone 467 00:25:34,560 --> 00:25:38,359 Speaker 13: look bad and look disorganized and then creates a story 468 00:25:38,359 --> 00:25:41,040 Speaker 13: that doesn't need to be a story. And so I 469 00:25:41,040 --> 00:25:43,080 Speaker 13: think Donald Trump's going to just pounce on that. And 470 00:25:43,080 --> 00:25:46,960 Speaker 13: I think for Kim Jeffries, he's trying to be the leader. 471 00:25:47,400 --> 00:25:50,680 Speaker 13: He's also hoping to turn the twenty five sixthit terms 472 00:25:50,680 --> 00:25:53,159 Speaker 13: into a gabble for himself. And so when you do that, 473 00:25:53,200 --> 00:25:55,760 Speaker 13: you're you're a leader of the whole institution. You're not 474 00:25:55,960 --> 00:25:58,520 Speaker 13: just the leader of the party. And I think he's 475 00:25:58,520 --> 00:26:00,639 Speaker 13: taking that role and trying to rise above the fray 476 00:26:00,680 --> 00:26:03,679 Speaker 13: of different things, and Chris van Holland is looking to 477 00:26:04,480 --> 00:26:07,520 Speaker 13: run and Galvin I is more support and name recognition 478 00:26:08,359 --> 00:26:09,400 Speaker 13: before a twenty eight run. 479 00:26:10,600 --> 00:26:12,960 Speaker 2: Just a minute left, Jeannie, how about the godfather rule? 480 00:26:13,000 --> 00:26:15,600 Speaker 2: Would it be hoof hackem Jeffries to pour a glass 481 00:26:15,640 --> 00:26:18,479 Speaker 2: of wine, maybe not the cigarette and sit down with 482 00:26:18,680 --> 00:26:20,440 Speaker 2: Mom Donnie. 483 00:26:20,720 --> 00:26:23,160 Speaker 12: Yeah, yeah, I like that the godfather role. 484 00:26:23,240 --> 00:26:25,960 Speaker 11: Yeah. I think he absolutely should. I would be surprised 485 00:26:26,000 --> 00:26:29,479 Speaker 11: if he hasn't already. The reality is, you know, he 486 00:26:29,600 --> 00:26:32,119 Speaker 11: has to try to win the House for the Democrats. 487 00:26:32,200 --> 00:26:35,600 Speaker 11: That means big fundraisers need to contribute to the Democratic Party. 488 00:26:35,920 --> 00:26:37,480 Speaker 12: So his base is very. 489 00:26:37,280 --> 00:26:40,239 Speaker 11: Different from Mom Donnie's, but they have a lot in 490 00:26:40,320 --> 00:26:44,359 Speaker 11: common that they agree on and particularly beating Donald Trump, 491 00:26:44,480 --> 00:26:46,960 Speaker 11: and so I do think they should. Well, I don't know, 492 00:26:47,040 --> 00:26:49,280 Speaker 11: have a beer together or what do godfathers drink? 493 00:26:49,320 --> 00:26:50,960 Speaker 12: Joe, I have no idea. You'd know better. 494 00:26:51,440 --> 00:26:53,080 Speaker 2: I think it's well, I think it's why a lot 495 00:26:53,080 --> 00:26:55,439 Speaker 2: of Chianti would go a long way here. Really interesting 496 00:26:55,480 --> 00:26:58,240 Speaker 2: conversation with Jeanie Shanzano and Morag Gillespie. We thank you 497 00:26:58,280 --> 00:27:01,639 Speaker 2: both for a great panel. Bloomberg Policy contributor Geenie Shanzo, 498 00:27:01,720 --> 00:27:05,800 Speaker 2: Morigillespie at Bluestack Strategies. We thank you, as always for 499 00:27:05,840 --> 00:27:08,680 Speaker 2: the insights. We'll have another panel for you tomorrow. Stay 500 00:27:08,720 --> 00:27:10,840 Speaker 2: with us on Balance of Power. We'll have much more 501 00:27:10,880 --> 00:27:11,840 Speaker 2: coming up after this. 502 00:27:16,240 --> 00:27:19,720 Speaker 1: You're listening to the Bloomberg Balance of Power Podcast. Catch 503 00:27:19,760 --> 00:27:22,840 Speaker 1: us live weekdays at noon and five pm Eastern on 504 00:27:22,960 --> 00:27:26,320 Speaker 1: Applecarcklay and Android Auto with the Bloomberg Business App. You 505 00:27:26,359 --> 00:27:29,800 Speaker 1: can also listen live on Amazon Alexa from our flagship 506 00:27:29,880 --> 00:27:34,000 Speaker 1: New York station, Just Say Alexa play Bloomberg eleven thirty. 507 00:27:35,000 --> 00:27:38,240 Speaker 2: Joe Matthew alongside Credie Gupta, who's in for Kayley Lines 508 00:27:38,840 --> 00:27:41,280 Speaker 2: today in Washington. Creedie, we've spent a lot of time 509 00:27:41,320 --> 00:27:43,920 Speaker 2: talking about healthcare, coming out of the debate surrounding the 510 00:27:43,960 --> 00:27:47,399 Speaker 2: President's Big beautiful bill, the debate around even how to 511 00:27:47,520 --> 00:27:51,159 Speaker 2: frame changes to Medicare that some call cuts and others 512 00:27:51,240 --> 00:27:53,080 Speaker 2: call efficiencies. 513 00:27:53,080 --> 00:27:54,920 Speaker 7: And we've got another big moment coming. 514 00:27:54,760 --> 00:27:56,439 Speaker 2: Up here at the end of the year with the 515 00:27:56,440 --> 00:28:01,560 Speaker 2: expiration of Obamacare or Affordable Care Act subsidies expiring that 516 00:28:01,640 --> 00:28:08,119 Speaker 2: could in fact provide a path I know I'm reaching 517 00:28:08,160 --> 00:28:09,800 Speaker 2: a little bit further here, but a path to a 518 00:28:09,880 --> 00:28:13,439 Speaker 2: deal and to fund the government. We've asked a lot 519 00:28:13,480 --> 00:28:15,600 Speaker 2: of lawmakers about this over the past couple of weeks, 520 00:28:15,640 --> 00:28:17,800 Speaker 2: and you wake up this morning and read the tip sheets, 521 00:28:17,800 --> 00:28:19,119 Speaker 2: and people seem to think that we're going to have 522 00:28:19,119 --> 00:28:19,640 Speaker 2: a shutdown. 523 00:28:20,000 --> 00:28:20,800 Speaker 7: But if there is. 524 00:28:20,720 --> 00:28:23,960 Speaker 2: Some common ground found following the decisions and all the 525 00:28:23,960 --> 00:28:26,119 Speaker 2: rest of the things, that might in fact be the 526 00:28:26,160 --> 00:28:27,919 Speaker 2: subsidies for Obamacare. 527 00:28:27,440 --> 00:28:29,800 Speaker 3: Yeah, and the extensions there, but is enough to have 528 00:28:30,080 --> 00:28:33,000 Speaker 3: an extension beyond even just the winter that which is 529 00:28:33,000 --> 00:28:34,800 Speaker 3: what we're eyeing here. Sprinkled on top of all of 530 00:28:34,800 --> 00:28:37,040 Speaker 3: that is just where we get our healthcare guidance from. 531 00:28:37,440 --> 00:28:38,160 Speaker 7: Well, that's for sure. 532 00:28:38,200 --> 00:28:41,880 Speaker 2: And recalling the testimony from RFK Junior recently, that was 533 00:28:41,920 --> 00:28:44,480 Speaker 2: a big part of the conversation here in Washington, which 534 00:28:44,480 --> 00:28:46,640 Speaker 2: is why it's a pleasure to introduce to you to 535 00:28:46,960 --> 00:28:50,640 Speaker 2: Paul Markovich. It's a conversation that we've been looking forward 536 00:28:50,720 --> 00:28:52,920 Speaker 2: to hear on balance of power. Is the chief executive 537 00:28:52,960 --> 00:28:57,880 Speaker 2: officer president of Ascendian, which just announced its formation, is 538 00:28:57,880 --> 00:29:01,160 Speaker 2: the parent company for Blue Shield of calib Paul, it's great. 539 00:29:00,960 --> 00:29:02,880 Speaker 7: To see you in our studio. Thank you for coming in. 540 00:29:03,240 --> 00:29:04,800 Speaker 7: Joe Creedi, thanks so much for having me. 541 00:29:04,800 --> 00:29:06,360 Speaker 2: Well, there's a lot that we could talk about here, 542 00:29:06,400 --> 00:29:10,320 Speaker 2: and I'd like to just start broadly with your parent 543 00:29:10,400 --> 00:29:15,120 Speaker 2: company here now. Aiming to cut bureaucracy and cover more people. 544 00:29:15,760 --> 00:29:18,440 Speaker 2: Is that in line with the goals of this Department 545 00:29:18,440 --> 00:29:19,840 Speaker 2: of Health and Human Services? 546 00:29:20,360 --> 00:29:21,200 Speaker 7: I think that it is. 547 00:29:21,280 --> 00:29:25,120 Speaker 14: I mean, I think what I see from this group, 548 00:29:25,320 --> 00:29:28,960 Speaker 14: I give them high marks for urgency and ambition, particularly 549 00:29:29,160 --> 00:29:31,400 Speaker 14: with when it comes to technology. We're seeing a lot 550 00:29:31,520 --> 00:29:36,160 Speaker 14: of initiatives coming out of that agency trying to drive 551 00:29:36,240 --> 00:29:38,719 Speaker 14: the adoption of technology, and I think with that has 552 00:29:38,760 --> 00:29:41,920 Speaker 14: the opportunity to reduce a lot of the administrative bureaucracy 553 00:29:42,000 --> 00:29:44,280 Speaker 14: and burdens that we face day to day and to 554 00:29:44,360 --> 00:29:45,440 Speaker 14: help us save some money. 555 00:29:46,440 --> 00:29:48,200 Speaker 3: In the last I want to say, a month or so, 556 00:29:48,560 --> 00:29:51,640 Speaker 3: we heard about the formation of the West Coast Alliance 557 00:29:52,080 --> 00:29:55,320 Speaker 3: several states that are talking about providing health care policy 558 00:29:55,400 --> 00:29:59,120 Speaker 3: as an alternative to what we're hearing out of Health 559 00:29:59,120 --> 00:30:00,640 Speaker 3: and Human Services here Washington. 560 00:30:01,080 --> 00:30:04,200 Speaker 4: Is that where you're driving your health care policy from. 561 00:30:04,640 --> 00:30:06,920 Speaker 14: Well, when it comes to things like vaccines, which is 562 00:30:06,920 --> 00:30:10,640 Speaker 14: what they're focused on right now, Blue Shield of nonprofit 563 00:30:10,640 --> 00:30:13,160 Speaker 14: Blue Shield of California is going to follow state law 564 00:30:13,200 --> 00:30:15,320 Speaker 14: and state law right now is really clear that there's 565 00:30:15,320 --> 00:30:18,040 Speaker 14: a whole series of vaccines that are covered and that 566 00:30:18,120 --> 00:30:20,880 Speaker 14: will include COVID when the governor signs a bill that 567 00:30:20,960 --> 00:30:23,920 Speaker 14: just passed the legislature on that front. So I think, 568 00:30:23,960 --> 00:30:28,040 Speaker 14: irrespective of that coalition, California has been pretty clear at 569 00:30:28,120 --> 00:30:30,240 Speaker 14: least when it comes to vaccines on what health plans 570 00:30:30,280 --> 00:30:32,480 Speaker 14: need to cover and don't and we will do and 571 00:30:32,520 --> 00:30:35,520 Speaker 14: we will always follow the law, both federal and state law. 572 00:30:36,240 --> 00:30:40,680 Speaker 14: It'll be interesting to see how this coalition evolves and 573 00:30:40,720 --> 00:30:42,960 Speaker 14: the other kinds of issues that may come up along 574 00:30:42,960 --> 00:30:44,719 Speaker 14: the way. It's a little hard to predict, but right 575 00:30:44,760 --> 00:30:46,840 Speaker 14: now is really focused on vaccines. 576 00:30:47,160 --> 00:30:52,360 Speaker 2: I mentioned the expiration of Obamacare subsidies. Your largest business, 577 00:30:52,400 --> 00:30:54,560 Speaker 2: Blue Shield of California, as we mentioned, sign on with 578 00:30:54,600 --> 00:30:58,320 Speaker 2: a group keep Americans Covered, and you are out with 579 00:30:58,320 --> 00:31:01,920 Speaker 2: a letter in fact in August warning of the healthcare 580 00:31:01,960 --> 00:31:04,520 Speaker 2: cliff as somewhere now calling it if Affordable Care Act 581 00:31:04,600 --> 00:31:06,360 Speaker 2: credits are not extended. 582 00:31:06,840 --> 00:31:08,360 Speaker 7: Where's your head on this? Right now? 583 00:31:08,400 --> 00:31:11,080 Speaker 2: The debate is underway as we speak. Do you think 584 00:31:11,120 --> 00:31:13,400 Speaker 2: they will be What would happen if they were not? 585 00:31:13,920 --> 00:31:14,080 Speaker 5: Well? 586 00:31:14,120 --> 00:31:15,880 Speaker 14: I would love to have a crystal ball and be 587 00:31:15,920 --> 00:31:17,600 Speaker 14: able to predict what's going to happen. 588 00:31:17,640 --> 00:31:19,440 Speaker 7: I think I'd be Yeah, I don't know what's going 589 00:31:19,480 --> 00:31:19,880 Speaker 7: to happen. 590 00:31:20,160 --> 00:31:23,600 Speaker 14: I think there's enough. There's a really intense dialogue I 591 00:31:23,640 --> 00:31:27,920 Speaker 14: think going on on both sides of that question. From 592 00:31:27,960 --> 00:31:32,680 Speaker 14: our vantage point, we're a nonprofit, mission driven organization, we 593 00:31:32,720 --> 00:31:35,640 Speaker 14: would like to see everyone covered. We talk about creating 594 00:31:35,680 --> 00:31:38,040 Speaker 14: a healthcare system that's worthy of our family and friends 595 00:31:38,040 --> 00:31:41,640 Speaker 14: and sustainably affordable for everyone. And so anytime I think 596 00:31:41,680 --> 00:31:47,520 Speaker 14: you're reducing the amount of subsidy that anyone receives to 597 00:31:47,640 --> 00:31:51,160 Speaker 14: help pay for healthcare, particularly those of lower income, you're 598 00:31:51,200 --> 00:31:53,600 Speaker 14: going to end up losing people from coverage if you do. 599 00:31:53,640 --> 00:31:56,680 Speaker 14: And there's just no getting around that equation. The problem 600 00:31:56,760 --> 00:31:59,200 Speaker 14: right now is this healthcare is just too damn expensive. 601 00:31:59,240 --> 00:32:02,400 Speaker 14: I mean, it costs so much money that the average 602 00:32:02,400 --> 00:32:06,320 Speaker 14: American simply cannot afford the average premium without a subsidy, and. 603 00:32:06,280 --> 00:32:08,800 Speaker 7: We need to address that. I mean, let's just be clear, like, 604 00:32:08,840 --> 00:32:10,720 Speaker 7: we can't keep going the way that we're going. 605 00:32:10,760 --> 00:32:14,280 Speaker 14: And so I think for those that are concerned about subsidies, 606 00:32:14,280 --> 00:32:17,400 Speaker 14: I understand the argument, which is to say that we 607 00:32:17,440 --> 00:32:21,800 Speaker 14: really are bankrupting this country with the way healthcare costs 608 00:32:21,800 --> 00:32:22,760 Speaker 14: have been where they. 609 00:32:22,640 --> 00:32:23,840 Speaker 7: Are now and where they're growing. 610 00:32:24,120 --> 00:32:26,440 Speaker 14: So we do need to address that, But I don't 611 00:32:26,440 --> 00:32:29,040 Speaker 14: think the way to address that is to take people 612 00:32:29,040 --> 00:32:30,760 Speaker 14: off the rules. I think the way to address that 613 00:32:31,080 --> 00:32:34,080 Speaker 14: is to get to some of the administrative efficiencies and 614 00:32:34,120 --> 00:32:37,000 Speaker 14: improvements and care that will help make it more affordable 615 00:32:37,000 --> 00:32:37,520 Speaker 14: over time. 616 00:32:38,160 --> 00:32:40,680 Speaker 3: Can you get to that end goal without doing the 617 00:32:40,680 --> 00:32:45,040 Speaker 3: intermediate step of not extending some of that coverage? Is 618 00:32:45,040 --> 00:32:49,000 Speaker 3: it possible to find the kind of best case scenario 619 00:32:49,080 --> 00:32:52,240 Speaker 3: and the cheaper healthcare alternative without pulling back on some 620 00:32:52,280 --> 00:32:52,840 Speaker 3: of those costs? 621 00:32:52,880 --> 00:32:56,920 Speaker 14: First, well, I think, look, healthcare has got a productivity problem. 622 00:32:57,000 --> 00:32:59,600 Speaker 14: We just keep throwing more resources into it, and we're 623 00:32:59,720 --> 00:33:01,760 Speaker 14: getting a better product out of it. Like at the 624 00:33:01,800 --> 00:33:04,120 Speaker 14: macro level, there's some brilliant things that happen on the 625 00:33:04,120 --> 00:33:07,120 Speaker 14: ground with any particular patient at any particular time, But 626 00:33:07,760 --> 00:33:09,800 Speaker 14: when you look at the macro the last twenty years, 627 00:33:09,920 --> 00:33:12,200 Speaker 14: wages have gone up about three percent a year, healthcare 628 00:33:12,520 --> 00:33:14,280 Speaker 14: costs of average six to eight percent a year. 629 00:33:14,640 --> 00:33:17,520 Speaker 7: That's just not something you can continue forever. 630 00:33:18,000 --> 00:33:20,360 Speaker 14: And so and a lot of it has to do 631 00:33:20,440 --> 00:33:24,000 Speaker 14: with we just keep throwing more resources at things, and 632 00:33:24,280 --> 00:33:27,680 Speaker 14: we still use fax machines. When you go get your 633 00:33:27,960 --> 00:33:31,800 Speaker 14: MRI or test, they'll hand you a cd ROM. I mean, 634 00:33:31,800 --> 00:33:35,440 Speaker 14: there's a reason this administration has to kill the clipboard 635 00:33:35,480 --> 00:33:39,280 Speaker 14: initiative because we're still using clipboards to fill out information. 636 00:33:39,320 --> 00:33:41,120 Speaker 7: How many times when you go to the hospital, as I. 637 00:33:41,080 --> 00:33:42,760 Speaker 14: Do with my son who was in the emergency room 638 00:33:42,800 --> 00:33:46,360 Speaker 14: a few a few months ago with appendicitis, get asked 639 00:33:46,360 --> 00:33:50,440 Speaker 14: the same question six or seven times, And so a 640 00:33:50,520 --> 00:33:53,440 Speaker 14: lot of this is just it's not necessarily even about 641 00:33:53,480 --> 00:33:57,960 Speaker 14: the clinical care. We're massively inefficient from an administrative standpoint, 642 00:33:58,000 --> 00:34:01,080 Speaker 14: and there's no reason, creedy to your question, that we 643 00:34:01,160 --> 00:34:03,640 Speaker 14: can't pass a law that says every American ought to 644 00:34:03,640 --> 00:34:06,760 Speaker 14: have access to a comprehensive, real time digital health record 645 00:34:06,800 --> 00:34:08,880 Speaker 14: on their phone or their favorite tablet. They do it 646 00:34:08,920 --> 00:34:11,399 Speaker 14: in every other aspect of their life. That can lead 647 00:34:11,440 --> 00:34:14,879 Speaker 14: to huge efficiencies administratively, not to mention a way better 648 00:34:14,920 --> 00:34:16,280 Speaker 14: experience for the average America. 649 00:34:16,320 --> 00:34:18,480 Speaker 2: Interesting, as a parent who's brought a child to the 650 00:34:18,680 --> 00:34:22,480 Speaker 2: er with appendicitis, I see, and I hope everybody's okay. 651 00:34:22,920 --> 00:34:26,239 Speaker 2: I just you've said a couple of things, including healthcare 652 00:34:27,280 --> 00:34:30,799 Speaker 2: bankrupting America as we know it at some point here 653 00:34:30,840 --> 00:34:31,440 Speaker 2: in the future. 654 00:34:31,480 --> 00:34:32,520 Speaker 7: And it brings me to. 655 00:34:32,480 --> 00:34:35,880 Speaker 2: The fireside chat that we saw you deliver at the 656 00:34:35,920 --> 00:34:40,520 Speaker 2: America's Health Insurance Plans lobbying group. Here you talked about 657 00:34:40,520 --> 00:34:44,360 Speaker 2: a cliff separate from the Obamacare cliff that people have 658 00:34:44,640 --> 00:34:46,600 Speaker 2: established at the end of the year. You said, we 659 00:34:46,600 --> 00:34:48,879 Speaker 2: don't know how far away it is. We just don't 660 00:34:48,920 --> 00:34:50,359 Speaker 2: know when we're going to fall over the edge. Let 661 00:34:50,400 --> 00:34:52,400 Speaker 2: me put it another way. Your business in healthcare is 662 00:34:52,480 --> 00:34:55,719 Speaker 2: not sustainable. If the industry is not sustainable. If that's 663 00:34:55,760 --> 00:34:58,920 Speaker 2: your perspective, who's to blame and how do you fix that? 664 00:34:59,480 --> 00:35:03,120 Speaker 7: It possible to avert the cliff. It is possible to 665 00:35:03,160 --> 00:35:03,880 Speaker 7: avert the cliff. 666 00:35:04,360 --> 00:35:06,680 Speaker 14: I think everybody is a part of the problem, and 667 00:35:06,760 --> 00:35:11,320 Speaker 14: everybody is a part of the solution. Health plans, hospitals, physicians, 668 00:35:11,320 --> 00:35:15,520 Speaker 14: pharmaceutical companies, everyone in the industry right now are not 669 00:35:15,600 --> 00:35:18,440 Speaker 14: doing all the things that they should be doing, and 670 00:35:19,120 --> 00:35:21,920 Speaker 14: yet they're also doing some things that are really contributing positively. 671 00:35:22,320 --> 00:35:24,960 Speaker 14: At the end of the day, this system is fundamentally flawed. 672 00:35:25,560 --> 00:35:30,280 Speaker 14: We pay by the volume, and we pay for volume. 673 00:35:30,880 --> 00:35:32,400 Speaker 14: If you're going to get paid. As a physician, you 674 00:35:32,440 --> 00:35:35,560 Speaker 14: have to see people and have office visits, or you 675 00:35:35,600 --> 00:35:36,520 Speaker 14: need to do surgeries. 676 00:35:36,840 --> 00:35:37,319 Speaker 7: If you're a. 677 00:35:37,239 --> 00:35:39,319 Speaker 14: Hospital, you need to keep people in the hospital or 678 00:35:39,320 --> 00:35:41,160 Speaker 14: have them use a different services. 679 00:35:41,400 --> 00:35:43,000 Speaker 7: If you're a pharmaceutical. 680 00:35:42,400 --> 00:35:44,880 Speaker 14: Company, you need to get everything's about volume, and so 681 00:35:45,040 --> 00:35:48,400 Speaker 14: we churn out as more volume but not necessarily better outcomes. 682 00:35:48,560 --> 00:35:51,000 Speaker 14: So that system needs to shift. There's three things that 683 00:35:51,040 --> 00:35:53,040 Speaker 14: need to happen. We need to pay people differently so 684 00:35:53,040 --> 00:35:56,160 Speaker 14: that we're paying for outcomes better healthcare, not more healthcare. 685 00:35:56,600 --> 00:35:58,880 Speaker 14: We need to make it digital and simple, like I 686 00:35:58,920 --> 00:36:01,279 Speaker 14: mentioned before, and take a lot of administrative cost out 687 00:36:01,320 --> 00:36:03,520 Speaker 14: of the system. And then finally, we need to truly 688 00:36:03,560 --> 00:36:06,600 Speaker 14: personalize it. And I do think that there's both technology 689 00:36:06,640 --> 00:36:08,560 Speaker 14: and other processes that can help us do that. 690 00:36:08,640 --> 00:36:12,080 Speaker 3: Today you mentioned some of the pharmacies as perhaps one 691 00:36:12,160 --> 00:36:15,040 Speaker 3: component of the issue. It's been brought to our attention 692 00:36:15,440 --> 00:36:17,839 Speaker 3: that you have recently cut CBS care mark from your 693 00:36:17,840 --> 00:36:20,680 Speaker 3: business and are purchasing directly from drug manufacturers. 694 00:36:20,680 --> 00:36:22,040 Speaker 4: Can you just explain the logic of. 695 00:36:21,920 --> 00:36:24,239 Speaker 3: That move and why more of your peers in the 696 00:36:24,239 --> 00:36:26,359 Speaker 3: space aren't doing the same well. 697 00:36:26,400 --> 00:36:29,439 Speaker 14: This space is the classic example of more is better, 698 00:36:29,440 --> 00:36:34,040 Speaker 14: as opposed to better is better because you have a 699 00:36:34,120 --> 00:36:39,360 Speaker 14: situation where there's multiple players in the distribution system between 700 00:36:39,400 --> 00:36:42,719 Speaker 14: the pharmacy manufacturer and the patient, and they all get 701 00:36:42,760 --> 00:36:45,840 Speaker 14: paid more money when we sell or administer a higher 702 00:36:45,920 --> 00:36:49,200 Speaker 14: volume of more expensive drugs. So guess what we do? 703 00:36:49,360 --> 00:36:52,280 Speaker 14: We sell a higher volume of more expensive drugs. Great example, 704 00:36:52,400 --> 00:36:56,879 Speaker 14: hume Era is an injectable drug that's used for things 705 00:36:56,880 --> 00:37:00,560 Speaker 14: like rheumatoid arthritis. It is the single rug in twenty 706 00:37:00,640 --> 00:37:03,359 Speaker 14: twenty four that Blue Shield of California spent the most 707 00:37:03,440 --> 00:37:08,280 Speaker 14: money on. It lost its market exclusivity in early twenty 708 00:37:08,320 --> 00:37:11,040 Speaker 14: twenty three, which meant that companies could offer what are 709 00:37:11,040 --> 00:37:14,799 Speaker 14: called biosimilars that could effectively do the same thing because 710 00:37:14,800 --> 00:37:17,840 Speaker 14: there was no longer a patent exclusivity on that drug, 711 00:37:18,640 --> 00:37:23,160 Speaker 14: and potentially introduced competition, which they did. We ended up 712 00:37:23,200 --> 00:37:26,759 Speaker 14: as a result of this model that you mentioned, contracting 713 00:37:26,800 --> 00:37:30,399 Speaker 14: directly to get the drug so Humera. In twenty twenty four, 714 00:37:31,400 --> 00:37:34,960 Speaker 14: the list price was around seven thousand dollars per month. 715 00:37:36,080 --> 00:37:39,200 Speaker 14: The net price was around twenty one hundred dollars a month, 716 00:37:39,239 --> 00:37:41,080 Speaker 14: which means when you take all the rebates and fees 717 00:37:41,080 --> 00:37:44,280 Speaker 14: out that were going through all these intermediaries. The actual 718 00:37:44,320 --> 00:37:48,239 Speaker 14: reimbursement to the manufacturer was around twenty twenty one hundred dollars. 719 00:37:48,480 --> 00:37:51,360 Speaker 14: We negotiated a deal for five hundred and forty five bucks, 720 00:37:51,840 --> 00:37:54,000 Speaker 14: and so that's the kind of thing that's going on. 721 00:37:54,160 --> 00:37:56,680 Speaker 14: But at the same time, in twenty twenty four, despite 722 00:37:56,680 --> 00:37:59,120 Speaker 14: the fact that these deals were out there, HUMERAA had 723 00:37:59,120 --> 00:38:02,520 Speaker 14: more than ninety sent market share for that drug. And 724 00:38:02,520 --> 00:38:06,160 Speaker 14: that's because amazing all the players were getting rewarded for 725 00:38:07,040 --> 00:38:09,640 Speaker 14: selling and administering a more expensive drug when there were 726 00:38:09,719 --> 00:38:11,160 Speaker 14: less expensive options available. 727 00:38:11,200 --> 00:38:14,719 Speaker 2: What do you do with glp ones thousand dollars a 728 00:38:14,760 --> 00:38:18,359 Speaker 2: month for zep bound This drug class is truly about 729 00:38:18,400 --> 00:38:21,440 Speaker 2: to go mainstream. Does this break the back in a 730 00:38:21,480 --> 00:38:24,960 Speaker 2: similar way? Well, it's just too expensive right now. 731 00:38:25,080 --> 00:38:28,040 Speaker 14: I mean when you think about it, and I was 732 00:38:28,080 --> 00:38:31,440 Speaker 14: talking to a group of drug manufacturers recently about this. 733 00:38:32,719 --> 00:38:38,840 Speaker 14: The average total insurance premium per person that BlueShield collected 734 00:38:38,920 --> 00:38:42,000 Speaker 14: for people that get their insurance through their employer in 735 00:38:42,080 --> 00:38:44,839 Speaker 14: twenty twenty four was around three hundred and thirty dollars 736 00:38:44,920 --> 00:38:49,640 Speaker 14: a month. This drug is being priced at more than 737 00:38:49,680 --> 00:38:52,799 Speaker 14: that per month for one patient. So there's simply no 738 00:38:52,960 --> 00:38:56,759 Speaker 14: way economically that you can cover the drug at that 739 00:38:56,880 --> 00:38:58,960 Speaker 14: price for all the people that would like to get 740 00:38:59,000 --> 00:39:03,200 Speaker 14: access to it and keep it economically sustainable. 741 00:39:03,560 --> 00:39:05,040 Speaker 7: But to me, this is an opportunity. 742 00:39:05,040 --> 00:39:06,840 Speaker 14: This is an example of an opportunity to say, well, 743 00:39:06,920 --> 00:39:09,560 Speaker 14: let's think about a different payment model. If we were 744 00:39:09,600 --> 00:39:12,440 Speaker 14: to think about a way to pay the manufacturer to 745 00:39:12,560 --> 00:39:16,759 Speaker 14: actually help people lose weight and get healthier and get 746 00:39:16,800 --> 00:39:19,960 Speaker 14: their cost down, as opposed to every time you sell 747 00:39:19,960 --> 00:39:23,399 Speaker 14: a pill or an injectable you get more money. Then 748 00:39:23,400 --> 00:39:29,200 Speaker 14: there's a way for them to get rewarded financially for helping, 749 00:39:29,440 --> 00:39:32,440 Speaker 14: but only when they help people actually get healthier, when 750 00:39:32,480 --> 00:39:34,520 Speaker 14: they help them lose weight. Because one of the challenges 751 00:39:34,560 --> 00:39:36,799 Speaker 14: we've seen with these drugs is not just their total cost, 752 00:39:36,880 --> 00:39:39,000 Speaker 14: but there's a lot of people that start on the 753 00:39:39,040 --> 00:39:40,359 Speaker 14: drug and then come off, and then they. 754 00:39:40,239 --> 00:39:41,359 Speaker 7: Don't get the benefits of it. 755 00:39:41,440 --> 00:39:43,680 Speaker 14: So you get the cost upfront, you really don't get 756 00:39:43,680 --> 00:39:47,640 Speaker 14: the benefits of it in the system. And ultimately, what 757 00:39:47,680 --> 00:39:51,520 Speaker 14: you're looking for is these drugs have their incredible innovations, 758 00:39:51,560 --> 00:39:55,040 Speaker 14: They have a tremendous potential positive impact on healthcare for people. 759 00:39:55,080 --> 00:39:56,359 Speaker 7: We want people. 760 00:39:56,080 --> 00:39:59,439 Speaker 14: In the right circumstances to access them, but we want 761 00:39:59,440 --> 00:40:00,920 Speaker 14: them to get the benefit of it. 762 00:40:01,160 --> 00:40:01,880 Speaker 7: Really interesting. 763 00:40:01,920 --> 00:40:04,360 Speaker 2: This is a story that's not going away, Paul, and 764 00:40:04,400 --> 00:40:06,080 Speaker 2: we'd love to stay in touch with you on this. 765 00:40:06,160 --> 00:40:08,640 Speaker 2: Thank you for coming to visit us. Paul Markovich. The 766 00:40:08,680 --> 00:40:11,040 Speaker 2: company is a SENDI and he is president and CEO. 767 00:40:11,120 --> 00:40:13,960 Speaker 2: And we learned a lot today, Creedy when it comes 768 00:40:14,000 --> 00:40:15,040 Speaker 2: to all of these issues. 769 00:40:15,200 --> 00:40:16,399 Speaker 7: We still have to figure out this. 770 00:40:16,360 --> 00:40:19,439 Speaker 2: Obamacare expiration at the end of the year, as Paul 771 00:40:19,480 --> 00:40:22,000 Speaker 2: mentioned in the throes of debate on Capitol Hill right now. 772 00:40:22,040 --> 00:40:24,080 Speaker 4: Not to mention that. Plus there's always a tariff question. 773 00:40:24,120 --> 00:40:25,920 Speaker 3: A lot of these drugs that Paul's is talking about, 774 00:40:26,080 --> 00:40:27,840 Speaker 3: they come from Europe, they come from What's run, they 775 00:40:27,880 --> 00:40:29,320 Speaker 3: come from India, they come from Denmark. 776 00:40:29,480 --> 00:40:32,520 Speaker 2: President's still promising farmas tariffs. We haven't gotten there quite yet. 777 00:40:32,600 --> 00:40:35,799 Speaker 2: Thanks for listening to the Balance of Power podcast. Make 778 00:40:35,840 --> 00:40:38,799 Speaker 2: sure to subscribe if you haven't already, at Apple, Spotify, 779 00:40:38,880 --> 00:40:41,439 Speaker 2: or wherever you get your podcasts, and you can find 780 00:40:41,520 --> 00:40:44,319 Speaker 2: us live every weekday from Washington, DC at New Time 781 00:40:44,400 --> 00:40:46,520 Speaker 2: Eastern at Bloomberg dot com.