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Speaker 2: This conversation is for every elected politician in Washington as
Speaker 2: they listen on ninety ninety one FM this morning. Douglas
Speaker 2: Erwin is an institution. Blanche Flower is not an institution.
Speaker 2: He's just a macroeconomist. Doug Irwin is an institution at
Speaker 2: Dartmouth at College. In his ute, the definitive book and
Speaker 2: still fresh, Fresh Fresh is against the tide.
Speaker 3: It was definitive at the time. More recently is clashing
Speaker 3: over commerce.
Speaker 2: For those of you on YouTube, it's over his right
Speaker 2: shoulder at right now and book lined office, Professor Irwin.
Speaker 2: We are honored that you would attend today. If you
Speaker 2: were to meet with a congressional leadership today, how should
Speaker 2: they respond to what the executive branch has wrought?
Speaker 4: I would say that under the US Constitution, Article one,
Speaker 4: section eight, you have power over tariffs, and the problem
Speaker 4: has been is successive congresses have delegated so many powers
Speaker 4: of tariff setting to the president on the assumption that
Speaker 4: the president will basically act in the national interest and
Speaker 4: tend to lower tariffs and trade agreements. That Congress has
Speaker 4: given up its authority. So it's time for Congress to
Speaker 4: stand up and assert itself a bit more on trade.
Speaker 4: Their constituents will be hurt by many of these measures,
Speaker 4: and yet the Republicans seem to be very quiet about it.
Speaker 2: How will they affect that reassertion. Do they need the
Speaker 2: judicial branch to support them or do they just sit
Speaker 2: down with the beverage of their choice. What do they
Speaker 2: drink at Dartmouth? It's like lebats.
Speaker 3: Yes, they like Doug Irwin. Do they have a labet?
Speaker 3: So the president say this is too much?
Speaker 4: I think you have to look back to the first
Speaker 4: Trump term when President Trump almost pulled out of NAFTA
Speaker 4: and he was convinced by his Secretary of Agriculture and
Speaker 4: a few congressional allies that that would not be a
Speaker 4: right move, that he should renegotiate it because they were
Speaker 4: pointing to the harm that would be done to his voters,
Speaker 4: farmers in the Midwest, manufacturing firms in the Upper Midwest
Speaker 4: that depend on exports, and so that sort of helped
Speaker 4: convince him in terms of a longer run solution of
Speaker 4: changing legislation to in power Congress more that sort of
Speaker 4: a long run solution to what is now a short
Speaker 4: term crisis.
Speaker 5: Doug, how do we think about tariffs in a global
Speaker 5: intertwined economy. It's not like the eighteen hundreds where we
Speaker 5: imported a relatively small number of goods. We exported a
Speaker 5: relatively small number goods and then global economy to tariffs.
Speaker 6: How do they work?
Speaker 4: Yeah, you're right, it's actually very different than it was
Speaker 4: a century ago. A lot of trade a century ago
Speaker 4: was sort of in final goods or in very basic
Speaker 4: raw materials, and now what we have is integrated supply
Speaker 4: chains and international production networks. So the web of commerce
Speaker 4: and the greedy witch firms in all sectors are sort
Speaker 4: of bound to the global economy in some way. Is
Speaker 4: so much more extensive today than it was even fifty
Speaker 4: years ago, let alone one hundred years ago. The terriffs
Speaker 4: have much more ripple effects throughout the economy, and these
Speaker 4: proposed tariffs will rip apart North American supply chains and
Speaker 4: be quite extensive in terms of the reach that they
Speaker 4: will have.
Speaker 2: Deugr when you mentioned Frank Tausig the giant at Harvard
Speaker 2: years ago.
Speaker 3: This is folks one hundred years ago writing on terrffs.
Speaker 2: To me, there's a whole mythology going on right now,
Speaker 2: whether it's a president's affair with mister McKinley from another
Speaker 2: time and place.
Speaker 3: We trot back Lisa mentioned.
Speaker 2: Smoot Holly this morning, or we go back to August
Speaker 2: of nineteen seventy one when the world turned upside down
Speaker 2: with Richard Nixon and gold myth Doug Irwin is most wrong.
Speaker 4: Well, I'd say the myth that the US economy grew
Speaker 4: in the late nineteenth century. We became an industrial power
Speaker 4: because of the tariff. There's a classic case of correlation
Speaker 4: not being causation. So there are a lot of reasons
Speaker 4: why the US became an industrial power after the Civil War.
Speaker 4: Up until World War One, we had massive immigration. Not
Speaker 4: many people in the Comme administration and mentioned that we
Speaker 4: were the recipient of major capital inflows from Britain and
Speaker 4: other countries. We were adopting technology then the technological leader
Speaker 4: of Britain. We are pretty much open to the world
Speaker 4: except in trade, so we did have high tariffs, but
Speaker 4: they did promote manufacturing a bit. But if you look
Speaker 4: where the productivity growth was, it was in the service sector.
Speaker 4: It was railroads and then later electrification and telecommunications. It
Speaker 4: wasn't just manufacturing and becoming rich because of the tariff walls.
Speaker 2: If you're just joining us this morning, Bloomberg Surveillance, and
Speaker 2: thank you for joining Bloomberg. We continue with Douglas Erwin
Speaker 2: of Dartmouth at College. Many good guests coming up, including
Speaker 2: Damien Sasa are in Foreign Exchange down negative five ninety
Speaker 2: one to Erwin of Dartmouth.
Speaker 5: Paul Sweeney, Professor, talk to us about these tariffs in
Speaker 5: the context of they seem to be enacted by President
Speaker 5: Trump in response to non economic issues per se, maybe
Speaker 5: whether it's the fentanyl coming into this country, whether it's
Speaker 5: immigration policy from our neighbors. Is that kind of the
Speaker 5: way tariffs should be used, typically are used. How do
Speaker 5: you think about that?
Speaker 4: Well, what's interesting about these is they haven't really been
Speaker 4: vetted by the Trump economic team. His US Trade representative
Speaker 4: is not in office yet. We've just had the confirmation
Speaker 4: of the Treasury Secretary Commerce Secretary to come. So usually
Speaker 4: when countries imposed tarrifs, and usually when the US has
Speaker 4: done this in the past, there's an interagency process where
Speaker 4: you deliberate and you figure out what is the best
Speaker 4: case and how can we make these work? And I
Speaker 4: think these are a little bit in advance of those
Speaker 4: advanced discussions within the administration. So I think you get
Speaker 4: this hodgepodge of reasons why we're doing this. It could
Speaker 4: be the fentanyl phrase of the migrants. But we also
Speaker 4: hear still about the trade dempsit. I mean, when President
Speaker 4: Trump makes these statements, comes back to the imbalanced trade
Speaker 4: and he's actually ordered a review on that. But it's
Speaker 4: very hard for other countries negotiating, and there are ten
Speaker 4: different things that are being flung at you at in
Speaker 4: terms of what you're doing wrong.
Speaker 2: Dougarwin honored to have you here for breaking news. This
Speaker 2: is some Doug Ford. He is a Premier of Ontario.
Speaker 2: He's basically I mean Ontario stretch is from just north
Speaker 2: of Hanover, New Hampshire, all the way over to Carlton
Speaker 2: College in Minnesota. But the Ontario government says they will
Speaker 2: cancel all US contracts. And what's important is this is
Speaker 2: quote we're going one step further we'll be ripping up
Speaker 2: the province's contract with Starlink, and of course it has
Speaker 2: to do with the Elon Musk and all that. Dug Ford.
Speaker 2: Service sector hasn't been talked about much. Do you expect
Speaker 2: service sector to be harmed as much as the goods sector?
Speaker 4: Not as much because they're not directly hit by tariffs.
Speaker 4: But there's a complementarity between trade and services and trade
Speaker 4: and goods, and the two often go hand in hand.
Speaker 4: So if you disrupt trade and goods, there's going to
Speaker 4: be some spillower effects, negative ones for the service sector
Speaker 4: as well.
Speaker 5: Professor. Some of the concerns here as it relates to
Speaker 5: tariffs just in general is that they are inflationary in
Speaker 5: the US economy. How do you think about that?
Speaker 4: But I don't think they don't cause inflation in the
Speaker 4: sense of a sustained increase in the CPI. They are
Speaker 4: sort of level effects, so they will increase the level
Speaker 4: of consumer prices and industrial prices, so that will lead
Speaker 4: to a bump and measured inflation. It's not clear that
Speaker 4: FED has to respond to that, but what that means
Speaker 4: is the declining real income and purchasing power of those
Speaker 4: businesses and households. I mean, just to give you a
Speaker 4: personal example which I shared on social media yesterday, I
Speaker 4: had an email from Irving Oil, which provides US with propaine,
Speaker 4: saying that any tax that's levied on them as they
Speaker 4: ship propane from Canada to the US will be directly
Speaker 4: added to the bill that we're facing here in New Hampshire.
Speaker 4: So even before the terrorists took effect, are already being
Speaker 4: warned prices are going to go off.
Speaker 2: Lightheiser, and it's on my table at home. No trade
Speaker 2: is free. Robert Leiitthheiser focused on China. Lightheiser pushed aside
Speaker 2: in the second Trump administration, Douger went on a ten
Speaker 2: percent tariff on China. How would you suggest Beijing will respond?
Speaker 4: Actually, I'm a little bit less worried about China, and
Speaker 4: I'm a little bit surprised we're going after our allies
Speaker 4: and ripping up North American supply chains by going after
Speaker 4: Canada and Mexico. I mean, the big rival to the
Speaker 4: US and big problem in terms of trade has been China,
Speaker 4: and yet President Trump has deemphasized that. So I'm not
Speaker 4: going to agree with Robert Leittheizer on many things, but
Speaker 4: to the extent that he's focused mainly on China. I
Speaker 4: think that's where the administration has to look too.
Speaker 5: So, Professor, how do you think the governments of Canada
Speaker 5: and Mexico should respond? Will respond? I mean, how deep
Speaker 5: is this going to go? Do you think how long
Speaker 5: will does go?
Speaker 4: Do you think, well, it's very interesting. There's a report
Speaker 4: that the Prime Minister of Canada, Justin Trudeau, will be
Speaker 4: speaking with the President today, So I'd say there's a
Speaker 4: small chance things could get averted, even though I wouldn't
Speaker 4: be too autimistic about that. But I think they're responding
Speaker 4: in the way that actually they did at least Canada
Speaker 4: did with the smooth hawlight here for nineteen thirty. That
Speaker 4: is not to take it sitting down to retaliate, And
Speaker 4: they're very strategic in terms of the goods that they
Speaker 4: put pressure points on that are important in the US
Speaker 4: when in putting those tariffs on. So they try to
Speaker 4: post tariffs on things maximize the political harm in the US,
Speaker 4: but the least economic harm from Canada because they'll be
Speaker 4: subs to products that they can import.
Speaker 2: Doug the World stopped for against the Tide and intellectual
Speaker 2: history of free trade thirty.
Speaker 3: Some years ago.
Speaker 2: The final chapter thirty some years ago, Page two seventeen,
Speaker 2: The Past and Future of Free Trade?
Speaker 3: Okay, WTO.
Speaker 2: I was in Jimmy Chang's office in Hong Kong the
Speaker 2: day WTO collapsed. Doug Irwin, what is the future of
Speaker 2: free trade? After GAT, after Uruguay, after WTO, and now Trump?
Speaker 3: What is the future?
Speaker 4: Well, it's going to be a bit of a mess,
Speaker 4: and it could be basically redrawn lines of trade based
Speaker 4: on geopolitics. But you know, most countries, speaking outside of
Speaker 4: the US now, most countries have a tremendous stake in
Speaker 4: the trading system and open trade. They're much smaller economies.
Speaker 4: They've opened up over the past thirty forty fifty years
Speaker 4: or so. They received economic benefits buy and large from that,
Speaker 4: and to undo that is harmful for them. So I
Speaker 4: think even if the US, because of our politics for
Speaker 4: what have you, move in a different direction, the rest
Speaker 4: of the world will still be open for business to
Speaker 4: the intent they can.
Speaker 2: I mean, Doug, I know hitters like Jamie Diamond and listening,
Speaker 2: Brian moynan and others in banking. Maybe Christine Lergard, Good morning,
Speaker 2: Madame Lecguard and your team in Frankfort, Doug Irwin on
Speaker 2: the X axis, forget about J curve dynamics.
Speaker 3: I don't buy it.
Speaker 2: On the X axis, Professor Irwin, we shift from an
Speaker 2: inflationary dynamic of tariffs over to the growth or less
Speaker 2: growth dynamic on your time continuum.
Speaker 3: What's the when of that?
Speaker 2: When do we shift from a study of inflation higher
Speaker 2: to growth slower?
Speaker 4: Well, there have been a lot of independent forecasts of
Speaker 4: these Trump tariffs, from the Tax Foundation, from the INSU
Speaker 4: for International Economics, and from other entities, and none of
Speaker 4: them have any positive effects. It's always negative. And the
Speaker 4: question is, given the scenario, what how negative you go?
Speaker 4: You shave point two point three point four percent off
Speaker 4: of GDP. Those are sort of where the numbers are
Speaker 4: coming in, and those will come in fairly quickly. If
Speaker 4: we actually see the tariffs go into effect on Tuesday,
Speaker 4: we'll probably see, certainly by the second or third quarter,
Speaker 4: somewhat slower growth. Now, once again, that doesn't mean it's
Speaker 4: pushing us into recession, but it just means that after
Speaker 4: a year or two, our real GDP will be lower
Speaker 4: than it otherwise would have been.
Speaker 2: I got one final question, Doug, you're sort of up
Speaker 2: in you know, the edge of Canada.
Speaker 3: Yeah, Hanover's really mine.
Speaker 2: I mean it's not a Connecticut river and it's really
Speaker 2: it's like it's sort of like New York North.
Speaker 6: I don't know.
Speaker 5: Those are hardy people up there.
Speaker 3: They're hardy. Yeah, it's a strift bubble.
Speaker 2: Yes. What are you telling somebody over a cup of
Speaker 2: coffee this morning? Doug Irwin in Victoriaville, Quebec. You're at
Speaker 2: a diner in Victoria. What are you telling them to do?
Speaker 2: What should Canada do?
Speaker 4: You know? Canada was very savvy during the first Trump term.
Speaker 4: They made a lot of We talked about Congress. We
Speaker 4: opened our discussion with Congress. They realized that maybe the
Speaker 4: administration is not going to be very sympathetic, but in
Speaker 4: members of Congress are because they are much closer to
Speaker 4: how their constituents will be affected by this, and so
Speaker 4: they worked state legislatures, They worked on Capitol Hill and
Speaker 4: tried to create an environment where it constrains the administration
Speaker 4: in terms of how much they can push things and
Speaker 4: what they can do. So there may not be much
Speaker 4: support for Canada in the White House, but there are
Speaker 4: other pressure points in the business community and the state
Speaker 4: and legislatures and elsewhere that they can try to contain
Speaker 4: the damage that will be done to them from these tariffs.
Speaker 3: Douglas Irwin honored. You go to tend, go back to class,
Speaker 3: get the chalk in your hand and teach.
Speaker 4: Okay, I won't tell Blancheflower what you said.
Speaker 3: Okay, don't tell them.
Speaker 2: We're going to probably done in Florida right now, distant
Speaker 2: from the tariffs.
Speaker 3: Dougarwin, thank you so much.
Speaker 2: Into David Blanchefhard, thank you so much for his support
Speaker 2: of all of Dartmouth economic.
Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live
Speaker 1: weekday afternoons from seven to ten am Eastern. Listen on
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Speaker 2: Joining us. How Lori Calvissini here with the small stocks
Speaker 2: down two percent is as well? I mean, Laurie to
Speaker 2: cut to the chase. Can strollers move the term the
Speaker 2: needle on export import dynamics? Don't?
Speaker 7: I don't know about strollers, Tom, I don't think I
Speaker 7: ever paid one thousand dollars one of mine.
Speaker 3: There's one here, I kid you not, folks. The Junama
Speaker 3: Pilot collection.
Speaker 2: Baby Pram is two thousand nice good dollars and there's
Speaker 2: a small cab out they're making that puppy right now.
Speaker 2: Is this an opportunity, Lori Kelvicina, I mean, you're with
Speaker 2: the Royal Bank of Canada.
Speaker 3: Is this an opportunity to acquire stocks?
Speaker 4: Look?
Speaker 7: Look, it's always the good day to buy stocks, right Look,
Speaker 7: I think the reality is that we're seeing a little
Speaker 7: bit of a sell off today. It could have been worse.
Speaker 7: I do think that we've had some valuation problems in
Speaker 7: the market. I do think we've had some froth in
Speaker 7: the market. If you look at the CFTC data on
Speaker 7: US equity future positioning. I do still think it's going
Speaker 7: to be a good year in the equity market if
Speaker 7: we kind of get through this issue. And I've told people,
Speaker 7: you know, a common talking point today has been, Look,
Speaker 7: if you think about my S and P five hundred
Speaker 7: forecast sixty six hundred at the end of the year,
Speaker 7: not because of tariff specifically, but I have baked into
Speaker 7: that number the idea of a five to ten percent
Speaker 7: draw down. We do have a bare case ready to
Speaker 7: go a fifty seven seventy five should certain conditions be met.
Speaker 7: Those conditions have not been met. But there are things
Speaker 7: we have to keep an eye on. Ten year yields,
Speaker 7: how they react to the environment we're in right now.
Speaker 7: What about these vibes We've been hearing about these vibes
Speaker 7: that we're supposed to be so fantastic and explode post election,
Speaker 7: and yet we've had two disappointing prints on the consumer
Speaker 7: sentiment and confidence surveys. And now we've got businesses talking
Speaker 7: a lot about uncertainty from the tariffs, denting some of
Speaker 7: the post election optimism. So there are things we've got
Speaker 7: to watch. We've got to be vigilant. I think we're
Speaker 7: still on a good path. Are the odds that we
Speaker 7: could get knocked off that path up? Yeah, they're up
Speaker 7: a little bit, Laurie.
Speaker 5: How important are earnings to the twenty twenty five performance
Speaker 5: in this market? Because it just doesn't feel like I'm
Speaker 5: going to get that much from the Federal Reserve in
Speaker 5: terms of rate cuts, So it feels like I need
Speaker 5: to rely upon earnings maybe a little bit more.
Speaker 7: I think that's fair, Paul, And you know, we sort
Speaker 7: of have said this for two reasons. Number One, if
Speaker 7: we do are modeling on the valuation side and plug
Speaker 7: in current assumptions, whether it's my guys at RBC or
Speaker 7: the consensus numbers on things like inflation, the Fed ten
Speaker 7: year yields, I can't come up with that real you
Speaker 7: have a number for the market at the end of
Speaker 7: the year. Valuations have moved a lot, and they've done
Speaker 7: it on the backs of inflation ramping down, and now
Speaker 7: it looks like inflation, you know, there may be some
Speaker 7: upside pressures there. So I think it's tough from that perspective.
Speaker 7: And if you just take a more kind of simplistic
Speaker 7: analysis and look at a forward pe on the S
Speaker 7: and P five hundred and you can all these different versions.
Speaker 7: All my charts are showing me that we've kind of
Speaker 7: hit a ceiling and we're moving down a little bit.
Speaker 7: So I think valuation expansion is tough to come by.
Speaker 7: Earnings matter, margin expectations have been coming down. I do
Speaker 7: think that there are potential negative impacts to earnings, both
Speaker 7: from demand margins of right at the dollar is something
Speaker 7: else to watch from this tariff situation, and things like
Speaker 7: the dollar are already starting to pinch.
Speaker 3: Is there a small cap meg seven?
Speaker 2: Oh?
Speaker 7: You know, I think there are names that small cap
Speaker 7: investors end up crowding into. They don't like the fact
Speaker 7: that they do it, which is one of the things
Speaker 7: I love about the small cap investment community. But you know,
Speaker 7: I do think we've had a little bit of a
Speaker 7: squeeze on quality. And what I mean by that is
Speaker 7: you've seen just the quality characteristics of the Russell two
Speaker 7: thousand degrade nearly half of its negative earners, a lot
Speaker 7: of things that are kind of low liquidity, tiny market
Speaker 7: calf that frankly, active managers just can't buy, and so
Speaker 7: they do tend to gravitate to kind of the bigger
Speaker 7: small calfs, more liquidity, higher quality stats. But it's more
Speaker 7: expansive than a mag seven.
Speaker 3: It's been wonderful too.
Speaker 2: Short of visit Lori Kelvicin to thank you so much
Speaker 2: with OURBC Capital Markets. She'll be publishing in the coming lawers.
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday
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Speaker 1: Just say Alexa, Play Bloomberg eleven thirty This is important.
Speaker 2: As we talked to Douglas Herwin of Dartmouth College here
Speaker 2: and he really mentioned, like, where's the legislative branch? We
Speaker 2: continue with that on a gentleman from Harvard and now
Speaker 2: at Yale got a Makunda joins us scary and I
Speaker 2: want to go back to your book indispensable when leaders
Speaker 2: really matter? Where is the indispensable leadership of Republicans and
Speaker 2: Democrats in Congress in the Senate?
Speaker 3: Given this upset we.
Speaker 6: Have, Democrats have no idea what they should do, and
Speaker 6: Republicans have been broken to Trump's will. At this point,
Speaker 6: we've so you seen just about everybody coming.
Speaker 2: Is there a historical president to the way quote Republicans
Speaker 2: have been broken unquote.
Speaker 6: In the United States? It's hard to think of one.
Speaker 6: Even Franklin Roosevelt faced more domestic yeah from his own
Speaker 6: party than Trump does. Right now, just to put this
Speaker 6: in context, Donald Trump has higher approval ratings from Republicans,
Speaker 6: just from Republicans. He's inessentially a nothing any from anyone
Speaker 6: else than Ronald Reagan or George W.
Speaker 4: Bush.
Speaker 6: Ever, did I think he might actually have higher numbers
Speaker 6: than EISENHOWERD did?
Speaker 4: Right?
Speaker 6: He is the most popular Republican president among Republicans in
Speaker 6: the history of bowling.
Speaker 5: So what do you think he does with that type
Speaker 5: of popularity here? I mean, it feels like tariffs are
Speaker 5: kind of I don't know, they don't seem like that
Speaker 5: big a deal to me. I mean, one could argue
Speaker 5: if you had that type of support, one could do
Speaker 5: some really big things. How do you think that he
Speaker 5: and his administration think about their popularity and support?
Speaker 6: So the question here, right is do they how much
Speaker 6: are they care? Right? So, Donald Trump is particularly sensitive
Speaker 6: to popularity issues. He always has been. And this might
Speaker 6: just be an exercise in getting people to bend the
Speaker 6: knee and sort of defer to Donald Trump, and Okay,
Speaker 6: then there'll be some damage from that, but not kindstrophic.
Speaker 6: But the biggest moves that Trump has made are putting
Speaker 6: personnel's policy, putting loyalists in charge of the major organs
Speaker 6: of the major internal and external security organs of the government,
Speaker 6: and that gives him the ability to put pressure on
Speaker 6: the opposition in ways that we've never seen in the
Speaker 6: United States before.
Speaker 2: If you talked to the Secretary of Treasury who darkened
Speaker 2: the door in New Haven years.
Speaker 6: Ago, I have not talked to talking to Wait, yeah,
Speaker 6: I'm talking about.
Speaker 2: Okay, I mean I find it's absolutely fascinating and that
Speaker 2: you're sitting in You're sitting in the pit there doing
Speaker 2: the Yale management dance with a piece.
Speaker 3: Of chalk in your hand.
Speaker 2: What is your mandate to executives to communicate to their
Speaker 2: comfortable Republican candidate what this will mean for Carlos Gudier's,
Speaker 2: Kellogg's or Tyson Food, which Lisa just mentioned were their
Speaker 2: huge dark meat to China's strategy.
Speaker 3: What do executives say so?
Speaker 6: I think the first one is that if they don't
Speaker 6: realize it now, they will soon. The United States government
Speaker 6: has been uniquely stable for a couple of centuries, just
Speaker 6: basically longer than any the country in the world, and
Speaker 6: American business has been the extraordinary beneficiary of that. If
Speaker 6: that goes away, it will have consequences in ways that
Speaker 6: we cannot predict, but that are gargantuan. I'll just say,
Speaker 6: as a general rule, it's when the things that you
Speaker 6: so deeply believe about the world that you don't even
Speaker 6: think about them turn out not to be true that
Speaker 6: you have the biggest impact. And here is one where
Speaker 6: the basic underlying principle of everything in global economics and
Speaker 6: everything in global foreign policy has been the US government
Speaker 6: kind of knows what it's doing. That assumption is breaking
Speaker 6: while we speak, and that will change things for it.
Speaker 6: I'll just give you a couple of quick examples. Pepfar
Speaker 6: so PEPFAR is the program is created by George W.
Speaker 6: Bush distribute anti retrovirals in Africa. There are statues to
Speaker 6: George W. Bush in Africa. There are children named after him.
Speaker 6: Because of the scale of this achievement, when they put
Speaker 6: out the spending freeze, people just stopped getting their drugs
Speaker 6: in Africa the next day. If pep far goes away,
Speaker 6: the estimate for it south Africa alone, just South Africa,
Speaker 6: is that in the next ten years, six hundred thousand
Speaker 6: people will die. That is the sort of achievement, right.
Speaker 6: Only the United States can do things like that. It
Speaker 6: is a gargantuan achievement. It costs the average American like
Speaker 6: a dollar a year or something like that. It's just
Speaker 6: any insignificant expense, and it buys us not just helping
Speaker 6: to keep people alive, it buys us sort of acceptance
Speaker 6: allies from you know, China.
Speaker 2: President Trump has huge popularity numbers. I think there's going
Speaker 2: to be a lot of polls that agree with his speed,
Speaker 2: his thrust. But part of that is to say to
Speaker 2: CDC in Atlanta, they can't talk to the World Health Organization.
Speaker 2: Basically the global medical system shuts down. What do you
Speaker 2: suggest the legislature, our Congress could do about it? If anything?
Speaker 6: So Democrats have the ability to essentially bring the Senate
Speaker 6: to a halt by manipulating rules, so deny unanimous consent
Speaker 6: on everything, force everybody to be in there. They can
Speaker 6: do a lot to be obstacle.
Speaker 3: Do you see that yet?
Speaker 6: No, not at all.
Speaker 2: Did you see rarema Manuel? He was up morning Joe
Speaker 2: this morning. We're efforting mister Emmanuel here on a blistering
Speaker 2: essay in the Post this weekend on kids Democratic Party.
Speaker 6: It's quite astonishing. So not just in the legislature. Greshen
Speaker 6: Whitmer has said she wants to cooperate and is out
Speaker 6: sort of selling her selling her the kids version of autobiography.
Speaker 6: Gresham Whitmer has phenomenal political instincts, so I'm not going
Speaker 6: to say, well, that's crazy, but it's a surprising tack
Speaker 6: for her to take. I also wonder if to some extent,
Speaker 6: Democrats are not just looking at the fire hose of
Speaker 6: things coming out of the Trump administration and saying, you know,
Speaker 6: any one of these individually is likely to be pretty
Speaker 6: unpopular in the combination, not with Republicans, but with most Americans,
Speaker 6: and the combination of them is likely to be extraordinarily unpopular. So,
Speaker 6: as we've talked about before, American public opinion is thermostatic.
Speaker 6: Whatever the president does, people move against it. If you
Speaker 6: do things that are unpopular, they move against it even
Speaker 6: more strongly if you interfere. This is the really striking
Speaker 6: one with the Treasury's payment system, which literally touches the
Speaker 6: life of every single American every day, every moment. People
Speaker 6: are going to feel that right away, and he is
Speaker 6: going to have pretty significant consequences the trade stuff. I
Speaker 6: agree with you, Paul that I think at a macro level,
Speaker 6: the economics on that are they're not going to be huge.
Speaker 6: But the individual people who are hurt by this are
Speaker 6: going to be hurt a lot, and they are going
Speaker 6: to scream really, really loudly, and that has political consequences
Speaker 6: that may be larger than the economic ones.
Speaker 5: Are you surprised that maybe we haven't Thank you, Ken.
Speaker 5: Are you surprised that maybe we haven't had a a
Speaker 5: someone from the Democratic Party really established himself or herself
Speaker 5: as a contravoice to President Trump and his policies. I mean,
Speaker 5: the only person I kind of hear from Schumer. But
Speaker 5: I mean, does the Democratic Party need a new voice,
Speaker 5: a new vision?
Speaker 6: It definitely does. The basic problem for the Democrats is
Speaker 6: not that they lost the twenty twenty four election that
Speaker 6: was baked into the inflation numbers. I don't see a
Speaker 6: scenario where they win that election. The basic problem for
Speaker 6: Democrats is they are not had it been twenty five states, right,
Speaker 6: so it's almost impossible for them to take the Senate.
Speaker 6: They started a huge handicap, and that is about larger
Speaker 6: institutional structural shifts in the party that are pretty severe.
Speaker 6: You can talk about any you know, like there are
Speaker 6: a million different explanations. My favorite one would be and
Speaker 6: an activist class that essentially is educated at Ivy League
Speaker 6: schools like mine and talks only to themselves and does
Speaker 6: not have a sense of that you can see Democrats
Speaker 6: who are likely to break out of that mold. You know,
Speaker 6: I mentioned Gresham Whitmer' is a popular one. I mean
Speaker 6: two names that people don't talk enough about, Reuben Gallego
Speaker 6: and Seth Moulton. And I mentioned both of them because yeah,
Speaker 6: they're both you know, they both went to Harvard, but
Speaker 6: they're both Marines. They are not part of the activist
Speaker 6: community where we only talk to you, right. They know
Speaker 6: how to talk to people who are out out of
Speaker 6: that mold, and they're very good at we're out of time.
Speaker 2: This has been really informative on an emotional day. The
Speaker 2: Tariff's clicking in here at midnight tonight. Mister Ford of
Speaker 2: Toronto and Ontario out with blistering statements today, including walking
Speaker 2: away from Starlink, and mister Musk as well got to
Speaker 2: Macondis with Yale University, and I'm sure we'll hear more
Speaker 2: from them.
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday
Speaker 1: starting at seven am Eastern on Apple Corplay and Android
Speaker 1: Auto with the Bloomberg Business app. You can also watch
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Speaker 3: On the front page is a Lisa Matteo. Our Lisa,
Speaker 3: what do you got?
Speaker 8: Okay, we've been talking about tariff, so I have to
Speaker 8: start there. Canadian sports fans are actually letting the US
Speaker 8: know how they feel about it. They're booing the national
Speaker 8: anthem sporting events. We're talking from the NBA to the NHL.
Speaker 8: So this happened yesterday. The Rafters were facing the Clippers
Speaker 8: in Toronto and a fifteen year old performer, she got
Speaker 8: out there and she was greeted with applause until she
Speaker 8: began singing the.
Speaker 6: Star Spangled banner.
Speaker 3: Yeah, they weren't too.
Speaker 8: Happy about it, started booing. This is from actually an
Speaker 8: ABC affiliate. They pulled this down from a social media post.
Speaker 8: But it's just this growing trend, Like it wasn't just
Speaker 8: that game. It was Saturday during the anthem before NHL.
Speaker 8: You had the games in Calgary, ottawatch you last night
Speaker 8: Canucks fans in Vancouver they boo the anthem before their
Speaker 8: team took on Detroit. So it's this ongoing battle kind
Speaker 8: of showing the frustration. Some FANSO did say they felt bad,
Speaker 8: but the majority of them are.
Speaker 2: Really I defer to you too, because I grew up
Speaker 2: in Toronto South a place called Rochester where you know,
Speaker 2: I mean, I think I was the first one in
Speaker 2: America to drink Mulston and Gold, sure, but often, but
Speaker 2: I don't have a clear thinking on this. I'm just
Speaker 2: too close to O Canada and all.
Speaker 8: That I do. But so next, moving on, So Michael Barr,
Speaker 8: you heard him give them the Grammy wrap ups, right, So
Speaker 8: I just wanted to do a little bit more in
Speaker 8: the two voices that were kind of unrecognized, you know.
Speaker 8: I had a couple of snubs along the way. So yes,
Speaker 8: Beyonce did win Alma the Year Cowboy Carter, right fifth
Speaker 8: time she was nominated for it. She also won Best
Speaker 8: Country Album. Her total trophy count now stands at thirty five.
Speaker 8: But it was this whole thing like she kept getting
Speaker 8: snubbed and kept getting snubbed, and finally she wins it
Speaker 8: for her country album. And then on the flip you
Speaker 8: also have Kendrick Lamar. He got Song Record of the
Speaker 8: Year for Not Like Us, which actually regenated as a
Speaker 8: Drake Disc song, but he was snubbed from that prize
Speaker 8: four times. To all these people who are getting snubbed,
Speaker 8: he actually what was interesting is that he beat out
Speaker 8: Record of the Year over Now and Then, which was
Speaker 8: this kind of resuscitated Beatles demo supported and supposedly made
Speaker 8: with Ai but they're just saying it's a victory for
Speaker 8: rap music because it's only one album of the year twice.
Speaker 8: I mean I think it was Lauren Hill and then Outcast.
Speaker 7: So that was a lot of the talk here.
Speaker 3: You know what the buzzes this Weekend.
Speaker 2: The Weekend has a new album now of Awesome, Awesome, Awesome,
Speaker 2: you know awesome. Mike Dean is the one putting it together.
Speaker 2: It's just hugely anticipated.
Speaker 3: There you go next.
Speaker 8: Oh and he's also at the Super Bowl to performing. Okay,
Speaker 8: so Chick fil A they want to make their drives
Speaker 8: through is faster. So this was an interesting look from
Speaker 8: the journal into how they're using high tech. Like this
Speaker 8: was a restaurant operator Rockford, Illinois. They had this new
Speaker 8: drive through record. It served one car every thirteen seconds.
Speaker 8: But they still want to improve it. So they're looking
Speaker 8: at different things security footage right in the kitchen, but
Speaker 8: also drones. They're using drones to kind of hover over
Speaker 8: the parking lot and take footage so they can look
Speaker 8: at it. And they actually found a few things where
Speaker 8: they can work on, like veteran workers taking on too
Speaker 8: many duties, the Wi Fi used by the parking lot
Speaker 8: order takers, because you know, they have them mountain in
Speaker 8: the parking lot. They didn't extend far enough, so they
Speaker 8: were kind of getting kicked off the Wi Fi as
Speaker 8: they were trying to take in all these orders. And
Speaker 8: so the company's just using like a lot of these experts.
Speaker 8: They're dispatching them to like three thousand of their different restaurants.
Speaker 8: But the interesting thing is how it's forcing a lot
Speaker 8: of other food chain who don't normally use drive throughs
Speaker 8: to use them, like Chipotle is starting to use drive
Speaker 8: through really yeah, because of the online orders are so huge,
Speaker 8: and shake Shack is starting to use drive throughs.
Speaker 2: Now, Isn't it just complexity of the menu, Like one
Speaker 2: it all goes in and gets his triple four bulte.
Speaker 3: Starbucks, they're reducing the complex.
Speaker 5: They're reducing complex because apparently the amount of combinations you
Speaker 5: can use on it Starbucks menu is mind boggling.
Speaker 2: So you gonna try to listen to tell you thank
Speaker 2: you so much for the news this morning.
Speaker 3: The newspapers.
Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify
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