WEBVTT - US Senator from Tennessee Bill Hagerty Talks Trump's Policy Initiatives

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>With fewer than one hundred days until voters head to

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<v Speaker 2>the polls. If re elected, former President Donald Trump is

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<v Speaker 2>widely expected to appoint a so called Capitol Hill cabinet

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<v Speaker 2>full of Congress made. A potential shortlist includes Republican Senator

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<v Speaker 2>Bill Hagersey, who is being floated as a pick for

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<v Speaker 2>Treasury Secretary. The senator joins us right now, Senator, it's

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<v Speaker 2>great to catch up me, sir. We tried to do

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<v Speaker 2>this last week, so this is our second attempt. I

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<v Speaker 2>think this one's going to work.

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<v Speaker 3>Good to be back with you, Jonathan Lisa, thank you.

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<v Speaker 2>Let's start with foreign exchange, if we can, sir. We

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<v Speaker 2>caught up with the former president here at Bloomberg just

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<v Speaker 2>a number of weeks ago, and in Bloomberg Business Week

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<v Speaker 2>he told us that he believes we have a bit

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<v Speaker 2>of a currency problem in the United States for America. Senator,

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<v Speaker 2>I would love your perspective on that, whether you agree

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<v Speaker 2>with a former president on that issue, and what kind

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<v Speaker 2>of policy tools do you think the government has to

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<v Speaker 2>address it.

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<v Speaker 3>We have a number of problems with the economy. I

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<v Speaker 3>think the biggest one, however, and is related is inflation

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<v Speaker 3>is driving higher interest rates. Of course that has a

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<v Speaker 3>direct impact on our currency. But President Trump's policies will

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<v Speaker 3>have an immediate impact to bring inflation down because he's

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<v Speaker 3>going to end this administration's war on fossil fuels, bring

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<v Speaker 3>energy costs down, go back to a deregulatory construct as

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<v Speaker 3>he did in the prior administration, taking down regulatory and

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<v Speaker 3>compliance barriers. All of these will have a lowering impact

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<v Speaker 3>on cost here in America. It'll have a lower impact

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<v Speaker 3>on inflation. Those will be directly beneficiary and basically help

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<v Speaker 3>make the case then to bring reachs down and therefore

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<v Speaker 3>bring our currency into a different position.

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<v Speaker 2>Senator, there are two other proposals as well, which I'm

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<v Speaker 2>sure you're familiar with, much higher tariffs, a much tougher

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<v Speaker 2>stance on immigration. I'm not going to sit here and

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<v Speaker 2>say whether that's the right or wrong thing to do.

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<v Speaker 2>I just want to talk about outcomes and consequences. Deutsche Bank,

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<v Speaker 2>like others on Wall Street, Senators you know, have pointed

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<v Speaker 2>out the tariffs and their associated stronger implications for the

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<v Speaker 2>dollar are significantly more likely to be the dominant market

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<v Speaker 2>outcome than policies to pursue a week of dollar. Senator,

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<v Speaker 2>my question to you would be, why wouldn't higher tariff

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<v Speaker 2>and a toughest stance and immigration ultimately just lead to stagflation.

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<v Speaker 3>I'm fully aware of the concerns surrounding tariffs, but let

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<v Speaker 3>me make this point. The United States of America has

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<v Speaker 3>the lowest tariff barriers of any major economy in the world.

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<v Speaker 3>The converse of that statement is that our major trading

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<v Speaker 3>partners do not have the similar tarifsy have much higher tariffs. Therefore,

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<v Speaker 3>we have a real lack of reciprocity. That's not fair.

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<v Speaker 3>That's something that needs to be addressed. Many of these

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<v Speaker 3>issues date back all the way to World War Two,

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<v Speaker 3>but there's come a time and a place to step

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<v Speaker 3>up and address that. President Trump wants to see them addressed.

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<v Speaker 3>We want to see more reciprocal and fair trading terms.

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<v Speaker 3>The time has come to get that accomplished, Senator.

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<v Speaker 1>From a market perspective, people are struggling with these two

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<v Speaker 1>goals sort of national security fairness on one hand, and

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<v Speaker 1>on the other hand, the idea of the advantage of

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<v Speaker 1>a weaker currency for trade purposes, which takes prominence pre eminence.

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<v Speaker 3>Well, I think It's something that always has to be balanced, Lisa,

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<v Speaker 3>and I think you'll see any administration do their best

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<v Speaker 3>to do it. I think President Trump did an excellent

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<v Speaker 3>of that during his first administration. The playbook is laid

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<v Speaker 3>out there. We were strong, we were tough with China.

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<v Speaker 3>At the same time, we brought economic growth that was

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<v Speaker 3>twice the rate of any of the major economy at

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<v Speaker 3>the same time here in America. So we can do both.

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<v Speaker 3>We can walk and shoo them at the same time.

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<v Speaker 3>I think that's the challenge. The most important thing, though,

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<v Speaker 3>is that President Trump will come in and in these

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<v Speaker 3>reckless policies domestically that have created inflation that has caused

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<v Speaker 3>so many knock on effects. Again, back to energy independence,

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<v Speaker 3>we need to get there. Not only will it be

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<v Speaker 3>important for lowering inflation here, but it'll be an important

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<v Speaker 3>geostrategic tool as we become much stronger allies who were

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<v Speaker 3>able to export our energy to places like Europe and Asia.

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<v Speaker 1>All right, let's go there. You've mentioned it a couple times,

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<v Speaker 1>this idea of war on fossil fuels, as well as

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<v Speaker 1>the idea of not really achieving the goal of energy

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<v Speaker 1>and dependence. We're pumping more oil in the United States.

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<v Speaker 1>We're producing more oil than ever before, more than thirteen

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<v Speaker 1>million barrels a day. This is something unseen before in

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<v Speaker 1>terms of production from any other nation. How can you

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<v Speaker 1>say that it's a war on fossil fuels time where

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<v Speaker 1>it is record production.

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<v Speaker 3>Lisia clearly is a war on fossil fuels. Because Joe

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<v Speaker 3>Biden came in and took federal lands off the map

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<v Speaker 3>immediately upon taking office. That's a quarter of our capacity

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<v Speaker 3>right there. What you're not saying is that there was

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<v Speaker 3>a trajectory that was much more rapid, much higher. We

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<v Speaker 3>took ourselves off of that growth trajectory and we flattened it.

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<v Speaker 3>We continued to produce, but demand is outstripping it. Think

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<v Speaker 3>about the demand for electricity here in America. If you

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<v Speaker 3>think about what we're going to need for artificial intelligence,

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<v Speaker 3>the electrification of the grid, We've got to get back

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<v Speaker 3>into the energy production business full blast. We have the

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<v Speaker 3>technology to do it. This administration has done everything they

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<v Speaker 3>can to slow that down. We need to get back

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<v Speaker 3>on a rapid growth path that'll put us on a

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<v Speaker 3>trajectory to be not only stronger here domestically in lower inflation,

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<v Speaker 3>but also stronger partners with our allies.

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<v Speaker 2>So senas right now, we're producing thirteen point three million

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<v Speaker 2>powers of crude every single day, As Lisa points it out,

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<v Speaker 2>that's a record, is more than anyone on the planet.

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<v Speaker 2>How much crude do you think America should be and

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<v Speaker 2>can be produce?

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<v Speaker 3>Sick We should be producing more than anybody else in

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<v Speaker 3>the world as we are. We need to produce more

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<v Speaker 3>LNG to become the strongest energy partner there is. You

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<v Speaker 3>think about pipeline capacity and the difficulty of getting permits

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<v Speaker 3>of this administration. You think about the difficulty beginning or

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<v Speaker 3>refinery started here in America. All of these log jams

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<v Speaker 3>and difficulties make it less possible for us, make it

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<v Speaker 3>more difficult for us to be the best possible ally

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<v Speaker 3>that we could. We need to expand it. We need

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<v Speaker 3>to realize that this is a true source of competitive

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<v Speaker 3>advantage for the United States of America. Let's exploit it.

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<v Speaker 2>Let's talk about who is an ally and who isn't

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<v Speaker 2>an ally. There's lots of conversations about what's going to

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<v Speaker 2>happen we trade policy and China. I think we've sort

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<v Speaker 2>of exhausted that conversation many times over the last few weeks, Senator,

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<v Speaker 2>I want to talk about Mexico. I want your view

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<v Speaker 2>on Mexico. We saw from Elon Musk of Tesla that

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<v Speaker 2>he's holding back investment decisions in the country because he

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<v Speaker 2>thinks there might be a change in the next year

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<v Speaker 2>that makes it difficult to produce automobiles over in Mexico.

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<v Speaker 2>We've heard similar thoughts from all the manufacturers elsewhere worldwide.

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<v Speaker 2>What is happening in Mexico and what kind of changes

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<v Speaker 2>would you like to see?

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<v Speaker 3>Well, in twenty twenty six, the USMCA is up for renegotiation,

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<v Speaker 3>and I think one of the greatest concerns is the

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<v Speaker 3>fact that Chinese ev makers are looking to end run

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<v Speaker 3>the USMC in run tariffs and use the USMCA and

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<v Speaker 3>Mexico market in particular as it means to get into

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<v Speaker 3>the US market, and they're using their subsidized product destroy

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<v Speaker 3>the US market. That's going to have to take a

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<v Speaker 3>very solid look. I think. Also with respect to Mexico itself,

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<v Speaker 3>we've seen some very concerning behavior there the prior administration

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<v Speaker 3>there n ra Amlow actually nationalizing American company's assets. We've

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<v Speaker 3>got to address that. I intend to speak with the

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<v Speaker 3>new administration there very soon about what we can do

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<v Speaker 3>to make certain we have much better and much stronger

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<v Speaker 3>relationship there with Mexico and fairer terms.

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<v Speaker 1>Senator. The last time we tried to talk, you were

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<v Speaker 1>at a bitcoin conference, and this was our cryptocurrency conference,

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<v Speaker 1>and that was where the former President Trump was speaking

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<v Speaker 1>and fundraising. And we've been asking this question on the show,

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<v Speaker 1>Why Bitcoin? Why now? Why crypto assets? What's sort of

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<v Speaker 1>the motivation to really embrace a network of crypto assets

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<v Speaker 1>and become the preeminent network on the plan And from

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<v Speaker 1>a Republican sort of stance, is this something that is

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<v Speaker 1>concrete and why?

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<v Speaker 3>At least I think this is something that has evolved

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<v Speaker 3>over time. I first began looking into crypto and the

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<v Speaker 3>previous administration in twenty eighteen. That was my first engagement.

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<v Speaker 3>I initially started at a point of skepticism, as I

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<v Speaker 3>think many of my colleagues do. But when I begin

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<v Speaker 3>to understand the underlying technology and realizing the potential for

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<v Speaker 3>dramatic productivity gains, what I thought to myself is we

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<v Speaker 3>need to make certain that it happens here in America.

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<v Speaker 3>The last thing we want is to see what happened

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<v Speaker 3>with the semiconductor industry where it got pushed off shore

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<v Speaker 3>and weakened us from a geopolitical standpoint, we need to

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<v Speaker 3>see this innovation happening here. I've been in many conversations

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<v Speaker 3>with President Trump. His thinking is likewise involved, and he's

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<v Speaker 3>embracing the fact that this has tremendous potential for America.

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<v Speaker 3>We want it to evolve here. We want to create

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<v Speaker 3>the ecosystem for it to thrive here, and the last

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<v Speaker 3>thing we need to do is push it off shore. However,

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<v Speaker 3>the current administration has done everything they can to attack

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<v Speaker 3>this industry, to push it offshore again, to use the SEC,

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<v Speaker 3>the CFTC, every tool at their disposal to come in

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<v Speaker 3>and attack this industry and refuse to provide it with

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<v Speaker 3>any time for regulatory framework. President Trump made the statement

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<v Speaker 3>at the Bitcoin conference that one of the first things

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<v Speaker 3>he'll do is change out the administration's leadership. Gerry Ginselari said,

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<v Speaker 3>will be fired. That brought people to their feet and applause.

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<v Speaker 3>He's going to end operation chokepoint that's been taking place

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<v Speaker 3>in the crypto industry here in America, and he's going

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<v Speaker 3>to try to create the environment here where the industry

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<v Speaker 3>can thrive and we'll see the next wave of innovation

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<v Speaker 3>happening right here in America.

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<v Speaker 2>Senator, we've got to dance around the issue about your future.

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<v Speaker 2>So this is how a frame mat. I've got twenty

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<v Speaker 2>seconds left on the clock. Your favorite city to live

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<v Speaker 2>in Nashville, Tokyo or Washington, DC?

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<v Speaker 3>Which one, No, it has to be Nashville, Tennessee. And

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<v Speaker 3>if you've been there at the Crypto conference, you've seen

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<v Speaker 3>the energy there. It is absolutely wonderful what's happening broadly

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<v Speaker 3>across my state. That's why so many people are moving there.

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<v Speaker 2>Senator, Thank you, sir. Senator Ville haggartsy there on the

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<v Speaker 2>latest with Crypto the economy,