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Speaker 2: Here in Washington, a lot of attention is fixed on
Speaker 2: what's taking place in the Senate today, or more specifically
Speaker 2: the Dirks and Senate Office Building, where the Senate Armed
Speaker 2: Services Committee is currently and still underway, holding the confirmation
Speaker 2: hearing for the Defense Secretary designate Pete Hegseth, who, of
Speaker 2: course has been tapped by President elect Donald Trump to
Speaker 2: lead the Pentagon, an organization with more than three million
Speaker 2: people reporting up and through it, and it's been a
Speaker 2: little contentious at times, perhaps no surprise. He's faced very
Speaker 2: difficult questions from Democrats in regard to a number of issues.
Speaker 2: But he also began the hearing by pleading his own case.
Speaker 2: Here's part of his opening statement.
Speaker 3: Now, it is true and has been acknowledged, that I
Speaker 3: don't have a similar biography to defense secretaries of the
Speaker 3: last thirty years. But as President Trump also told me,
Speaker 3: we've repeatedly placed people atop the pentagon with supposedly the
Speaker 3: right credentials, whether they are retire generals, academics, or defense
Speaker 3: contractor executives. And where has it gotten us, he believes,
Speaker 3: and I humbly agree that it's time to give someone
Speaker 3: with dust on.
Speaker 4: His boots the helm.
Speaker 3: A change agent, someone with no vested interest in certain
Speaker 3: companies or specific programs or approved narratives. My only special
Speaker 3: interest is the warfighter, deterring wars and if called upon,
Speaker 3: winning wars. By ensuring our warriors never enter a fair fight,
Speaker 3: we let them win and we bring them home. Like
Speaker 3: many of my generation, I've been there. I've led troops
Speaker 3: in combat. I've been on patrol for days. I've pulled
Speaker 3: a trigger down range, heard bullets whiz by, flexcuffed insurgents,
Speaker 3: called in close air support, led metavacsed dodged IEDs, pulled
Speaker 3: out dead bodies, and knelt before a battlefield cross. This
Speaker 3: is not academic for me. This is my life. I
Speaker 3: led then and I will lead now.
Speaker 5: Pete Hegseth, speaking before the Senate Armed Services Committee in
Speaker 5: prepared remarks, That's how it started, not only trying to
Speaker 5: make the case for his nomination and confirmation, of course,
Speaker 5: but also trying to get ahead of some of the
Speaker 5: more difficult questions that he might be asked. And he's
Speaker 5: been asked all of them, and we've got more to go.
Speaker 5: Here joining us a voice of experience who spent a
Speaker 5: lot of time with this committee and in rooms like these,
Speaker 5: Retired Marine Corps Major General Arnold Prenar, a former staff
Speaker 5: director the Senate Armed Services Committee, the author of IF Confirmed,
Speaker 5: an insider's view of the Senate comfort process with a
Speaker 5: perfect voice for today. General to spend some time, and
Speaker 5: we welcome you back to Bloomberg TV and Radio. As
Speaker 5: I mentioned, you've been in this room before. How's he doing.
Speaker 3: Well?
Speaker 6: I think he's doing extremely well. I was very impressed
Speaker 6: with his opening statement. As you mentioned, I've been involved
Speaker 6: in the confirmation process for over twelve Secretary of Defense,
Speaker 6: going all the way back to the Ford administration, both
Speaker 6: when I was on the committee the staff director of
Speaker 6: the committee and then helping various nominees since leaving government
Speaker 6: on a pro bono basis, and so most of our
Speaker 6: Secretaries of Defense get face tough questionings. But he certainly
Speaker 6: had a very strong opening statement. I've reviewed all of
Speaker 6: his advanced policy questions. I've listened very carefully to the hearing,
Speaker 6: and he's doing exceedingly well.
Speaker 7: In my judgment.
Speaker 2: Well and for many of the questions he is facing,
Speaker 2: at least the ones posed by Democrats, he's kind of
Speaker 2: doing so for the first time. As multiple Democratic senators
Speaker 2: have pointed out, Sir that Hegsath declined to meet with
Speaker 2: them in advance of this hearing, even though he was
Speaker 2: taking meetings with essentially all of the Republicans on this committee.
Speaker 2: Do you think that that was a mistake or was
Speaker 2: it unnecessary in this case when he wasn't likely to
Speaker 2: be able to rely on Democratic votes anyway.
Speaker 6: Well, typically the tradition is that nominees, and not just
Speaker 6: for the Secretary of Defense, all our defense nominees, of
Speaker 6: which they're sixty five in the Department of the Fence.
Speaker 6: So he's going to have a very strong team with
Speaker 6: him if he's confirmed, and I believe he will be confirmed,
Speaker 6: And typically they try to meet with everybody, but everybody's sidentials.
Speaker 6: I don't have any inside information other than what I
Speaker 6: just heard into hearing today.
Speaker 7: I know nominees try to meet with everybody.
Speaker 6: I know for a fact, that a number of the
Speaker 6: other nominees, the Secretary of the Navy, the Secretary of
Speaker 6: the Army nominee. They're meeting with both sides of the isle.
Speaker 6: So I don't know what really happened here. It's unfortunate
Speaker 6: if he didn't have a chance to meet with some
Speaker 6: of them. But on the other hand, it's not unusual.
Speaker 6: Its schedules don't match up.
Speaker 4: Yeah, they do.
Speaker 5: You all seem to be going out of their way
Speaker 5: to say the same thing on that front. But general,
Speaker 5: we'd love for you to bring us behind the scenes
Speaker 5: a bit and into the process. We hear a lot
Speaker 5: about mock hearings and murder boards. What goes into preparing
Speaker 5: someone like Pete Hegseth for a moment like this?
Speaker 4: How much time do you spend with them?
Speaker 5: How ugly does it get when you start looking at
Speaker 5: their record and try to give them a sense of
Speaker 5: the tough questions they're.
Speaker 4: Going to get.
Speaker 6: Well, you know, I go back and most of the
Speaker 6: sectips that I've been involved with, going all the way
Speaker 6: back to Harold Brown in the card administration, cat Weinberger,
Speaker 6: Don Rumsfeld Les Aspin all got tough questions. So there's
Speaker 6: nothing unusual about that number two. It does take a
Speaker 6: tremendous amount of preparation. Some of the previous secretaries of
Speaker 6: the fits that didn't prepare well did not do well
Speaker 6: in their confirmation hearing, and frankly they suffered from that
Speaker 6: when they became even though they got confirmed, you know,
Speaker 6: they did not have a good impression in the confirmation
Speaker 6: HEREA So I would assume, and I can tell from
Speaker 6: just the way he's answering the questions. I can tell
Speaker 6: from all the material supporting material that's been provided to
Speaker 6: the committee. I can tell by reading his extensive advanced
Speaker 6: policy questions. They have done a tremendous amount of preparation
Speaker 6: to get him ready for this hearing. But that's appropriate.
Speaker 6: You need to do that. As some people have said
Speaker 6: that the FITICS departments the largest most complex organization in
Speaker 6: the world, and it's all about war fighting, and so
Speaker 6: I would think that obviously they spend a tremendous amount
Speaker 6: of time with him getting him ready, and it shows
Speaker 6: he's doing a good job.
Speaker 2: So you think general that he's doing a good job
Speaker 2: and arguing that he is in fact qualified to do
Speaker 2: this job even though he, as has been raised in
Speaker 2: the hearing, he hasn't managed an organization bigger than hundreds
Speaker 2: of people, let alone millions, that he actually hasn't led
Speaker 2: an organizational audit, let alone one that could number in
Speaker 2: the hundreds of billions of dollars. I mean, is your
Speaker 2: takeaway from this hearing that Pete Hegseth is firmly qualified
Speaker 2: for this position.
Speaker 6: He's qualified in terms of the things that the secondary
Speaker 6: defense is involved in, and they are in Title ten.
Speaker 6: Somebody brought up one of the requirements, their requirements in
Speaker 6: Title ten, the US Code that creates the Department of
Speaker 6: Defense and the Secretary of Defense, and he's.
Speaker 7: He brought out the three things that I think are
Speaker 7: most important.
Speaker 6: He's focused on improving deterres because those of us that
Speaker 6: have been in combat like him, like myself and others
Speaker 6: I've been wounded in combat and been to more than
Speaker 6: one more, you wanted deter wards. You don't want to
Speaker 6: have to engage your wars, and you want to focus
Speaker 6: on war fighting and lethality. That's the role of the
Speaker 6: Secretary of Defense. He's going to have their sixty five
Speaker 6: confirmed people. They've already named a very strong team to
Speaker 6: be in there with him. John Faling to be Secretary
Speaker 6: of the Navy, Dan Driscol to be Secretary of the Army,
Speaker 6: Brince Kobe a real expert on policy, Mike Duffy a
Speaker 6: very tremendous expert in the acquisition area, and the deputy
Speaker 6: fin Berg a very very successful businessman. And the number
Speaker 6: two person is the chief operating officer. So the notion
Speaker 6: that somehow the Secretary of Defense is got to run
Speaker 6: the Pentagon all by themselves. And you've got the service chiefs,
Speaker 6: you got the Joint chiefs, you got the war fighting
Speaker 6: Combatant commander.
Speaker 7: So in my judgment, it takes that kind of a team.
Speaker 6: And the names that I've seen so far, because I
Speaker 6: know most of them have worked with them over the years,
Speaker 6: very experienced, It is going to be a very strong team.
Speaker 4: General. We all remember John Tower in nineteen eighty nine.
Speaker 5: I don't know if you have any personal anecdotes from
Speaker 5: that experience or any first hand stories, but can you
Speaker 5: speak to our audience about how rare it would be
Speaker 5: for a nominee like this to go down in a
Speaker 5: vote and committee or.
Speaker 4: On the floor.
Speaker 6: Well, in history, the only one that has not been
Speaker 6: approved was John Tower, and that was a.
Speaker 7: Very sad day. He was a great chairman of the
Speaker 7: Senate Armed Services Committee.
Speaker 6: The full expectation was that he would be confirmed, but
Speaker 6: there were issues that came up during the confirmation process,
Speaker 6: particularly as it relates to the FBI report that.
Speaker 7: Him not being approved.
Speaker 6: But the committee and the Congress turned around in the
Speaker 6: Senate very quickly and put Dick Cheney in very quickly
Speaker 6: after John Towers nomination was not approved. And so I think, frankly,
Speaker 6: the Senate deserves to give Pete headsp an upper down
Speaker 6: vote on day one. He's the only other civilian in
Speaker 6: the war fighting chain to come in from the Commander
Speaker 6: in chief to the combatant commands. We need a Secretary
Speaker 6: of Defense on there on day one, and he should
Speaker 6: get an upper down vote, which has been the president
Speaker 6: for secretaries of the Defense. And people that want to
Speaker 6: vote for him can vote for him. People that want
Speaker 6: to vote a gist him vote against him. And you know,
Speaker 6: a majority vote rules, and if he gets a majority vote,
Speaker 6: then he will be eligible to be sworn in and
Speaker 6: appointed day one.
Speaker 7: But he deserves an upper down vote on January twentieth.
Speaker 6: That's been the plan in the president going all the
Speaker 6: way back to Democrat and Republican presidents that on a
Speaker 6: new president that has a new Secretary of Defense gets
Speaker 6: an upper down.
Speaker 7: Vote on day one, and I hope that will be
Speaker 7: the case.
Speaker 2: Well, and assuming he is confirmed ultimately to lead this position, talk,
Speaker 2: if you will, general about what exactly he's going to
Speaker 2: if we've heard in this hearing a lot of kind
Speaker 2: of bureaucratical challenges, if you will, about the acquisition process,
Speaker 2: about an audit for the DoD. But then there's also
Speaker 2: the very real challenges in multiple theaters around the world
Speaker 2: where there are live conflicts or the threat of conflicts.
Speaker 2: How is he going to be able to navigate both
Speaker 2: those internal and external questions.
Speaker 6: Look, he's inheriting the same challenges that's the last two
Speaker 6: or three presidents have had. We live in a world
Speaker 6: that's more dangerous and unstable than the peak of the
Speaker 6: Cold War. We don't have the right strategy for dealing
Speaker 6: with the threats that we face from Russia, China, Iran,
Speaker 6: North Korea in global terrorism. We need to get back
Speaker 6: to basically being able to deter and if deterred spails
Speaker 6: to fight and win two major theater awards on a
Speaker 6: near simultaneous basis. We're not getting the bang for the
Speaker 6: buck we should for the dollars we spend in the
Speaker 6: Pentagon in constant dollars, and we're spending more than the
Speaker 6: peak of the Reagan build up, and the forces fifty
Speaker 6: percent smaller. One of the things he brought out today
Speaker 6: is we need to get people, you.
Speaker 7: Know, into the combat arms, and we have over.
Speaker 6: Three hundred thousand active duty military serving in inherently non
Speaker 6: governmental jobs are serving in the rear with the gear.
Speaker 6: The overhead in the Pentagon is massive. The requirements process
Speaker 6: needs performed, the acquisition process needs performed. We spend over
Speaker 6: four hundred and twenty billion dollars a year in the
Speaker 6: Pentagon on goods and services, supplies and equipment, and about
Speaker 6: the only thing you can say about that output it's
Speaker 6: been more, take longer, get less. And these problems are
Speaker 6: well known. He's gonna with his team going to have
Speaker 6: to tackle every single one of these. If you want
Speaker 6: to improve the Turrens, the Turrens is really important. You
Speaker 6: need to have the military capability. It has to be
Speaker 6: credible and your adversaries have to believe that you're going
Speaker 6: to use it. So he's going to inherit some significant
Speaker 6: challenges in all of these areas.
Speaker 5: We're spending some time on Bloomberg TV and Radio with
Speaker 5: retired Marine Corps General Arnold Pernaro, who literally wrote the
Speaker 5: book on Senate confirmations. General, I want to ask you
Speaker 5: about some criticism that we've heard from Democratic members of
Speaker 5: the committee about the FBI background check into Pete Hegseth.
Speaker 5: There are multiple words here that the FBI did not
Speaker 5: interview Hegseth's ex wives or the woman who actually accused
Speaker 5: him of sexual assaults in twenty seventeen.
Speaker 4: How unusual is that?
Speaker 5: Would that have been writing on a request from a
Speaker 5: committee leadership to look into that and interview those women,
Speaker 5: or is this a problem for the FBI to have
Speaker 5: not been as comprehensive as it should be.
Speaker 6: First of all, I want to applaud the new leadership
Speaker 6: in the Senate, the Leader Thun and others. It says, look,
Speaker 6: we're going to require the same kind of FBI fulfill
Speaker 6: investigations for the Trump nominees that has been required in
Speaker 6: every single previous president Democratic, Republican. And so that request
Speaker 6: doesn't come from the committees, it doesn't come from the Senate,
Speaker 6: it comes from the White House. Council's office, in this case,
Speaker 6: the Transition Council, because their White House Council for Trump
Speaker 6: has not been set up till January twentifth, and so
Speaker 6: they had the FBI go out and do what's called
Speaker 6: a full field investigation of potential nominees, and then that
Speaker 6: material is provided to the chairman and ranking member on
Speaker 6: the Center of Armed Services Committee, and it's at the
Speaker 6: chairman's discretion, as it was when my boss was chairman
Speaker 6: for eight years, as to who else might get access
Speaker 6: to that. One of the things you have to understand,
Speaker 6: it's not like an Inspector General report. It's not like
Speaker 6: a Article thirty two in the military, where there's an
Speaker 6: investigation their findings and their recommendations and they come to
Speaker 6: a conclusion and they say, well, this person is right
Speaker 6: and this person is wrong.
Speaker 7: It's just raw.
Speaker 6: Investigatory files and they can be very misleading, and so
Speaker 6: the FBI reports have to be treated with great deference
Speaker 6: in terms of what they can then used for. One
Speaker 6: of the things that I felt and people know that
Speaker 6: was very unfair in the Power thing is that there
Speaker 6: were a lot of things that got leaked out of
Speaker 6: the FBI report that weren't corroborated, and it was very damaging.
Speaker 6: And so I think the approach that Chairman Wicctor is
Speaker 6: taking in terms of restricting the FBI report is appropriate.
Speaker 6: In terms of what's in it, none of us are
Speaker 6: ever going to know because it's not going to be
Speaker 6: made available publicly, and certainly you have to rely on
Speaker 6: the investigatory skills of the FBI that they did a
Speaker 6: thorough investigation.
Speaker 7: And so typically what.
Speaker 6: Happens is if the Council believes there's disqualifying information in
Speaker 6: an FBI full fill investigation, they'll notify the President and
Speaker 6: the President will have to decide whether he still wants
Speaker 6: to go forward or not. The fact that the report
Speaker 6: was provided to the Chairman and ranking member, the fact
Speaker 6: that things are going forward, I just I don't have
Speaker 6: firsthand knowledge. I certainly don't have access to it. I
Speaker 6: don't have any leaked information. My work and assumption would
Speaker 6: be there's nothing in that report that's disqualifying because the
Speaker 6: proceedings are going forward.
Speaker 2: All right, General, thank you so much for joining us
Speaker 2: on Balance of Power today. That's retired Marine Corps General
Speaker 2: Ernold Panaro, who is Joe mentioned is also the author
Speaker 2: of if confirmed. An insider's view of the Senate confirmation process.
Speaker 1: You're listening to the Blue Work Balance of Power podcast.
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Speaker 5: Thirty confirmation hearing for Pete Haggseth get underway here. Actually,
Speaker 5: it's soon to draw to a close. It started at
Speaker 5: nine pint thirty this morning the Dirks and Senate Office Building.
Speaker 5: Twenty seven senators have an opportunity to ask Pete Hegseth.
Speaker 5: In some cases very difficult questions, Kaylee. We've heard about
Speaker 5: his history with alcohol, allegations of sexual assault, to which
Speaker 5: he maintains his innocence, some emotional testimony from the likes
Speaker 5: of Tammy Duckworth, some very difficult questions from Elizabeth Warren.
Speaker 5: Lockstep support though from Republicans in the room, and many
Speaker 5: expect him to be confirmed.
Speaker 2: Well, and interestingly as well, the one Republican many were
Speaker 2: keeping an eye on, as Senator Joni ERNs from Iowa,
Speaker 2: who's a combat veteran and sexual assault survivor herself, and
Speaker 2: even their report seemed friendlier than maybe you would have anticipated.
Speaker 2: She noted that they have met multiple times in private
Speaker 2: and had what she described as very frank conversations, and
Speaker 2: she just reiterated on some of the points that I
Speaker 2: guess they had discussed in private that she wanted to
Speaker 2: raise again today in the hearing. But she was going
Speaker 2: to be potentially the lynchpin vote on knowing only three
Speaker 2: Republican votes can be afford to be lost for handy.
Speaker 4: One lot of time, she was the one to watch.
Speaker 5: But after their meeting she seemed to back off, and
Speaker 5: by the way, a deliberate pressure campaign from the Magaworld
Speaker 5: against Joni Ernst that seemed to change her narrative, as
Speaker 5: did her meeting with Pete Hagseeth behind closed doors. To
Speaker 5: your point, Kaylee, she actually left time on the clock,
Speaker 5: which says a lot about the point she was trying
Speaker 5: to make.
Speaker 2: Yeah, so let's get into all of this now and
Speaker 2: turn to our political panel today. Genie Shanzino is with us, who,
Speaker 2: of course is a senior Democracy Fellow at the Center
Speaker 2: for the Study of the Presidency in Congress and a
Speaker 2: democratic strategist alongside Republican strategist Ashley Davis. Welcome to you both, Genie.
Speaker 2: Just to begin with you, obviously Democrats had coordinated their
Speaker 2: questioning here, much of it was incredibly intense. Is that
Speaker 2: they went after heg Seth on both character and qualifications
Speaker 2: for this job. But is anyone's mind really changing because
Speaker 2: of this Q and A.
Speaker 8: I don't think we see that yet.
Speaker 9: Could it happen, sure, but I don't think that there
Speaker 9: has been a misstep of the degree or sort of
Speaker 9: a surprise that would elicit changes on the Republican side.
Speaker 9: And you know, part of that, I think is the
Speaker 9: pressure campaign that you were both just talking about. There
Speaker 9: has been an organized pressure campaign from the right to
Speaker 9: support heg Seth and also to take on any Republicans
Speaker 9: who would stray offline. So I think so far no
Speaker 9: mind's changed. But I do think Democrats are doing what
Speaker 9: they need to do and wanted to do. They are
Speaker 9: getting their points out. And you know, I would just
Speaker 9: add two things surprise me. One that he didn't meet
Speaker 9: with them in advance or even try to set up
Speaker 9: a meeting if you believe what the senators are saying.
Speaker 9: And number two that We're only going to go one
Speaker 9: round on this. It is typical to go more than
Speaker 9: one round. I think we need as the American public
Speaker 9: to hear more from him, but we're only going to
Speaker 9: get one round seven inch eat, which is pretty short.
Speaker 5: Yeah, one round indeed, And I just want to go
Speaker 5: back to the moment between Pete Hegseth and Joni Ernst
Speaker 5: that Kaylee mentioned here the senator from Iowa with questions
Speaker 5: specifically about women serving in combat, will.
Speaker 9: You support women continuing to have the opportunity to serve
Speaker 9: in combat roles?
Speaker 4: Senator, First of all, thank you for your service.
Speaker 3: As we discussed extensively as well my privilege, and my
Speaker 3: answer is yes, exactly the way that you caveated it. Yes,
Speaker 3: women will have access to ground combat roles combat rows,
Speaker 3: given the standards remain high, and we'll have a review
Speaker 3: to ensure the standards have not been eroded in any
Speaker 3: one of these cases. That'll be part of one of
Speaker 3: the first things we do with the Pentagon is reviewing
Speaker 3: that in a gender neutral way. The standards ensuring readiness
Speaker 3: and meritocracy is front and center. But absolutely, it would
Speaker 3: be the privilege of a lifetime to if confirmed to
Speaker 3: be the Secretary of Defense for all men and women
Speaker 3: in uniform who fight so heroic, they have so many
Speaker 3: other options, they decide to put their right hand up
Speaker 3: for our country, and it would be an honor to
Speaker 3: have a chance to lead them.
Speaker 6: All.
Speaker 5: Right, let's bring Republican strategist Ashley Davis back into the conversation.
Speaker 5: If that's as tough as it gets from a Republican
Speaker 5: on the panel.
Speaker 4: Are we all done here?
Speaker 6: Pretty much?
Speaker 10: But I still want to As I was talking about earlier,
Speaker 10: I do think we need to watch John Curtis, especially
Speaker 10: who came out just a few hours ago saying that
Speaker 10: he needs to take another look at him, as well
Speaker 10: as Tulsa Gabbert. So I do think that there's that
Speaker 10: plus the three that we've always talked about in regards
Speaker 10: to Susan Collins, Lisa Murkowski, and also Mitch McConnell.
Speaker 4: Is why Mitch McConnell, just because Mitch.
Speaker 10: Has always had a little bit of a thorn in
Speaker 10: President Trump's side, And I also think that he takes
Speaker 10: the stance of the United States in the world, especially
Speaker 10: in regards to the military, very very seriously. He is
Speaker 10: not up for re election anymore, he's not running and
Speaker 10: he's not the majority leader, so he has the ability
Speaker 10: to vote against someone if he needs to. I'm not
Speaker 10: saying he will, he just has those those chains have.
Speaker 4: Been broken and so to speak.
Speaker 10: But John Curtis, I think is something early watch.
Speaker 6: I agree.
Speaker 10: I don't think that anyone's mind has been changed today.
Speaker 10: Nothing new came out. Obviously, I thought Tammy Duckberts was
Speaker 10: probably the strongest on the Democrat side in regards to
Speaker 10: her personal history. But I just don't think And obviously
Speaker 10: Senator earned Questions teed him up to answer the question
Speaker 10: that was very important, which was about obviously women in
Speaker 10: the military.
Speaker 2: As you make the point that Senator Curtis has expressed
Speaker 2: concerns not just about Hexeth but Toulci Gabbard as well.
Speaker 2: Do you see a relationship here where the better this
Speaker 2: process goes for him, the greater threat that it doesn't
Speaker 2: go so well for her, because that could potentially open
Speaker 2: the door for if Republicans are exercising one pass I'm
Speaker 2: shooting down nominee, it might become her instead of him.
Speaker 10: It could be and you know, will there'll be a
Speaker 10: sacrificial lamb so to speak. I mean Obviously RFK is
Speaker 10: still a concern. I mean the question here and obviously
Speaker 10: cash Bettel as well, But the main questionnaire is some
Speaker 10: of those FBI background checks that are still happening. So
Speaker 10: there's obviously a lot of different conversations out there about
Speaker 10: Tulsa Gabbert from what I understand, with her ability to
Speaker 10: get her clearances continue to be extended and confirmed that
Speaker 10: I don't know what is there that's not classified that
Speaker 10: us as the general public don't know. So I think
Speaker 10: that she probably is someone that could be a sacrificial
Speaker 10: lamb as well as I still think that RFK has
Speaker 10: an uproad pill battle.
Speaker 5: Yeah, he has to still have a lot of meetings
Speaker 5: for us to get a better sense of that. Genny,
Speaker 5: I know where we are on Pete Hegseth not meeting
Speaker 5: with Democrats here. I wonder where you are on the
Speaker 5: background check. We talked to General Punaro about this earlier
Speaker 5: in the hour that many Democrats on the panel have
Speaker 5: complained that the FBI did not interviews ex wives or
Speaker 5: the woman who accused him of sexual assaults in California
Speaker 5: in twenty seventeen. Those apparently would have needed to be
Speaker 5: requested by White House counsel either way, do they have
Speaker 5: a full picture of the man?
Speaker 9: Well, from what they're saying, they don't.
Speaker 7: You know.
Speaker 9: They are also complaining about the late timing in which,
Speaker 9: you know, these reports are being given to the Senate,
Speaker 9: and they don't feel like they're getting a full rundown.
Speaker 9: There was also reporting that his previous wife, one of
Speaker 9: his ex wives breached out to the FBI and didn't
Speaker 9: get a call back. You know, I think that that
Speaker 9: is worth thinking about. But I think the reality here
Speaker 9: is that not only do we need more time with
Speaker 9: Pete Hegseth, I think as a American public, I think
Speaker 9: there's also an awful lot of conversation hasn't been had.
Speaker 9: I mean, we've heard an awful lot about audits, internal challenges,
Speaker 9: and the DoD about his issues involving women and other things.
Speaker 9: But how about issues involving the security of the United States.
Speaker 9: How about the fact we're losing the race with China,
Speaker 9: in particular when it comes to how we're going to
Speaker 9: be a twenty first century fighting machine. All of these
Speaker 9: things have sort of gone by the wayside when you
Speaker 9: give senators seven minutes each, So to me, I think
Speaker 9: Republicans could do better in terms of giving their members
Speaker 9: more time to have more robust conversations with all of
Speaker 9: these nominees. I understand they want to do this fast,
Speaker 9: but this is the last time we get to hear
Speaker 9: this kind of back and forth, and I think we
Speaker 9: deserve more, so that you abandoning that practice, to me
Speaker 9: is really problematic, Ashley.
Speaker 10: There's two things that I just want to addressed. So
Speaker 10: the FBI background checks after a huge slate of kinins
Speaker 10: secretaries like this, they always, at least under my experience
Speaker 10: on the Bush administration, they do come up last minute. Obviously,
Speaker 10: the same thing I know happened under the Biden administration.
Speaker 10: The thing that I really want to get into here
Speaker 10: quickly is going through numerous FBI checks and at various levels.
Speaker 10: The point is not to call the ex wife. The
Speaker 10: point is to call, you know, the ex roommate or
Speaker 10: the neighbor that you had when you were twenty five
Speaker 10: years old. The FBI's role is to get to the
Speaker 10: third layer, the fourth layer, not the public information. So
Speaker 10: it doesn't bother me as much that he didn't talk
Speaker 10: to the ex wife. They didn't talk to the ex wife.
Speaker 10: It's more and by the way, it's not common that
Speaker 10: FBI backgrounds are given to every single person on the committee,
Speaker 10: So that is not something that in.
Speaker 4: This case, it was the chair and ranking member, right, correct,
Speaker 4: which is very normous.
Speaker 10: Yes, But so I just I remember f when I
Speaker 10: went through my own personal background checks. I remember like
Speaker 10: a random person in college that I barely knew was
Speaker 10: but not like my college roommate, you know. So it's
Speaker 10: like that's what they do. Yeah, so it doesn't bother
Speaker 10: me as much.
Speaker 5: Well important knowing that this has been a point of controversy,
Speaker 5: and I suspect we'll be for all of these confirmation hearings, Kaylee,
Speaker 5: Donald Trump didn't want any of them to have FBI
Speaker 5: background checks at one.
Speaker 2: Point, well, yeah, they weren't signing those typical transition documents
Speaker 2: in order to speed this process along just quickly. Here though,
Speaker 2: on the President elect Genie, it was pointed out by
Speaker 2: Senator Gary Peters during the course of his questioning that
Speaker 2: there were five either confirmed or acting secretaries of Defense
Speaker 2: in the first Trump administration. Even if Pete Hegseith is
Speaker 2: able to get the votes and be confirmed, should we
Speaker 2: have more confidence this time around that he'll be able
Speaker 2: to stick in that job?
Speaker 9: Oh, I don't know. You know, Donald Trump likes to
Speaker 9: fire people. We've seen that he's done it on TV,
Speaker 9: so you know, I'm not sure they'll stick. But that's
Speaker 9: the president's prerogative.
Speaker 8: So we could.
Speaker 9: Pete hegg Seth, if he's confirmed, could be the first
Speaker 9: of few.
Speaker 4: Boy, well, I guess we'll see about that. Genie, Thank
Speaker 4: you so much.
Speaker 5: Genie Shanzano Ashley Davis with us here at the table
Speaker 5: in Washington.
Speaker 6: Uh.
Speaker 5: I can't imagine going through the process, the full FBI
Speaker 5: background check.
Speaker 2: When she said random people from college, I write, yeah, Shook.
Speaker 2: That proposition is terry.
Speaker 10: It's why you don't lie.
Speaker 4: You do say you have.
Speaker 5: To warn all your family and friends though right hey,
Speaker 5: you might be getting a phone call.
Speaker 10: That's what I did, and none of them got the
Speaker 10: phone calls. It was the third layer that got the
Speaker 10: phone calls.
Speaker 2: One people.
Speaker 4: Yes, at every stage. What a great panel.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 4: Watch you Wall Street.
Speaker 5: As we cover politics, they frequently cross over. It's a
Speaker 5: little bit different today or though they're has been a
Speaker 5: conversation about defense contracting, the dB and of course, reforming
Speaker 5: procurement at the Pentagon as part of Pete Hegseth's wide
Speaker 5: ranging conversation before the Senate Armed Services Committee. That hearing
Speaker 5: is still underway but just about to conclude, with twenty
Speaker 5: seven senators each taking their time to ask questions of
Speaker 5: Donald Trump's nominee to run the Defense Department, Kaylee. At
Speaker 5: times it has been about cultural issues some of the
Speaker 5: allegations that have surrounded Hegseth, including his personal behavior when
Speaker 5: it comes to women, when it comes to alcohol DEI,
Speaker 5: women in combat, but also just the hard brass tax
Speaker 5: of managing a massive bureaucracy, the massive budget that you'd
Speaker 5: be in control of managing people, which has experienced that
Speaker 5: he does not have, though he seems to convince a
Speaker 5: lot of Republicans that he can do the job.
Speaker 2: Yeah, it's interesting. We've heard a lot of numbers throughout
Speaker 2: the course of this hearing, the idea that the Pentagon,
Speaker 2: the Department of Defense, does have three million people, that
Speaker 2: has a budget of eight hundred and fifty billion dollar.
Speaker 2: These are really big figures that we're working with. We've
Speaker 2: also heard over the course of this hearing, including from
Speaker 2: Senator Jony Earts, for example, and from Headseth himself, about
Speaker 2: a desire to get some of those figures down, specifically
Speaker 2: on the dollar figure side. As we talk about the
Speaker 2: auditing process at the Pentagon, or perhaps the lack thereof.
Speaker 2: It's those kind of internal substantive issues that we want
Speaker 2: to get into now with our next guest, doctor Anya
Speaker 2: Manuel is joining us. She's co founder of the strategic
Speaker 2: consulting firm Rice Hadley Gates and Manual also executive director
Speaker 2: of the Aspen Strategy Group. Welcome to balance a power Anya,
Speaker 2: Good to have you here on Bloomberg TV and Radio.
Speaker 2: And we consider the kind of size and scale of
Speaker 2: that internal DoD challenge that peak Headseth is making the
Speaker 2: case he is able to take on here if he
Speaker 2: is indeed confirmed to be the next Secretary of Defense,
Speaker 2: Just how hard is it going to be to actually
Speaker 2: execute and then the period of just four years.
Speaker 8: Yeah, happy to be with you, Kaylee, Thanks for having
Speaker 8: me on. You stated all the numbers. This is an
Speaker 8: enormous department to run the biggest department that the US
Speaker 8: government has, so real experience running large bureaucracies is important.
Speaker 8: Let me give you two points. One the outside challenges
Speaker 8: that the United States faces. This is really a more
Speaker 8: dangerous period we haven't faced since frankly, between the two
Speaker 8: World Wars. Great powers are acting badly. You're dealing with
Speaker 8: a rising China that needs to be managed. You're dealing
Speaker 8: with a Russia that is continuing to pommel Ukraine unjustly.
Speaker 8: You have Iran, which is currently on its back foot
Speaker 8: but can always cause trouble. So there are enormous geopolitical
Speaker 8: challenges that the next Secretary of Defense will have to
Speaker 8: face without getting US substantially involved in any of these
Speaker 8: wars as we currently are not on the internal side.
Speaker 8: You said a lot in a It's come up in
Speaker 8: the hearing. This is an enormous budget. One of the
Speaker 8: big things that will have to happen is the procurement
Speaker 8: of the Pentagon will need to be reformed. We are
Speaker 8: not currently buying the weapons that we need for the
Speaker 8: wars of the twenty first century. That alone is one
Speaker 8: hundred and forty two billion dollar budget. Very very important,
Speaker 8: and in my experience working with a Pentagon and with others.
Speaker 8: You need to bring the people of an organization along
Speaker 8: if you're going to make real change inside an organization.
Speaker 8: If you just do it by fiat from above, they'll
Speaker 8: fight you every step of the way.
Speaker 5: Let's put a finer point on reforming procurement here, because
Speaker 5: Joe Biden just named the next two aircraft carriers for
Speaker 5: Bill Clinton and for George W.
Speaker 4: Bush.
Speaker 5: Is that in itself part of the reform that needs
Speaker 5: to happen. We keep hearing from Elon Musk. It should
Speaker 5: be all unmanned, it should be drones from now on.
Speaker 5: But we have massive and very expensive weapons programs that
Speaker 5: are set to continue on for years.
Speaker 4: So where does the reform begin?
Speaker 8: Yeah, we do. There's lots of opinions on how you reform.
Speaker 8: It's been tried multiple times. I think the Biden administration
Speaker 8: deserves some credit for doing things like the Replicator program,
Speaker 8: which is getting drones and unmanned vehicles much faster into
Speaker 8: our system. But these are still small things. You can't
Speaker 8: just scrap the large weapon systems wholeheartedly, but you can
Speaker 8: start trimming some of them, cutting the ones that are
Speaker 8: likely to be sitting ducks. There's going to be a
Speaker 8: huge I don't want to get into the details of this,
Speaker 8: because they're going to be huge debates on what do
Speaker 8: you cut, what do you not cut. Every time you
Speaker 8: try to cut any big procurement weapon system, people crawl
Speaker 8: out of the woodwork because those are good jobs in
Speaker 8: America in certain districts, and so you need to have
Speaker 8: a good relationship with the US Congress to do some
Speaker 8: of those things. I would say one of the most
Speaker 8: effective secretaries of Defense we have had is my own
Speaker 8: current business partner, Bob Gates. He cut billions in over
Speaker 8: ten years from the Pentagon budget, and he did it
Speaker 8: without ruffling too many of the feathers.
Speaker 7: Well.
Speaker 2: Obviously, as we consider the budget and what exactly it
Speaker 2: pays for, a lot of that is heading into the
Speaker 2: defense industrial base, which you were just speaking to. Obviously,
Speaker 2: a lot of this is made in the US, and
Speaker 2: this has come to the four of conversation in regard
Speaker 2: to the supply of ammunition and other weapons systems for Ukraine.
Speaker 2: It was argued that really is an investment in the
Speaker 2: defense industrial base here at home, even though we're sending
Speaker 2: it elsewhere. How much progress really has been made when
Speaker 2: it comes though to the dib Anya versus what actually
Speaker 2: needs to be done to fortify the US's ability to
Speaker 2: continue providing for its own defense and the defense of
Speaker 2: its allies.
Speaker 8: Yeah, very good question. Hard to quantify it. Boy, if
Speaker 8: we started at zero, we're now maybe thirty forty percent
Speaker 8: of the way there. But more has to happen. What's
Speaker 8: always very difficult is to tell companies to ramp up
Speaker 8: production without having very clear contracts going far into the
Speaker 8: future about how that will be used. And that's going
Speaker 8: to continue to be a problem, and the next administration
Speaker 8: will have to continue to wrestle with it. I would
Speaker 8: say the Biden administration has made a really pretty good start.
Speaker 5: Here are senators asking any of the right questions today.
Speaker 8: I have only watched part of the hearings. I do
Speaker 8: hear a lot of substance, a lot of what you
Speaker 8: said in your preview. This is a large organization, three
Speaker 8: million people. It needs to be run well. You can't
Speaker 8: just break the system in order to rebuild it. You
Speaker 8: have to really manage it from within. And by the way,
Speaker 8: the Department is doing a lot of really important tasks
Speaker 8: right now, and you can't take your eye off that ball.
Speaker 8: So I do think some of the questions that have
Speaker 8: been asked about Indo Pacific security, how we continue our
Speaker 8: work with our allies in the Indo Pacific, which I
Speaker 8: think is one of the great strength of what the
Speaker 8: Biden administration did, really rebuilding those alliances with Japan, with Korea,
Speaker 8: with the Philippines, with Australia, with India. Those are all
Speaker 8: very important and I do hope the next Secretary of
Speaker 8: Defense keeps those going.
Speaker 6: Well.
Speaker 2: Of course, Pete Hegseth would like it to be him.
Speaker 2: We are looking here on Bloomberg TV and on YouTube
Speaker 2: at a live shot of the hearing room which has
Speaker 2: just of course concluded the hearing itself, and Pete Hegseth,
Speaker 2: along with his wife by his side, are now sharing
Speaker 2: hubs with a few members inside the room. Anya. Some
Speaker 2: of what we heard from Pete Hegseth today in regard
Speaker 2: to the operations of the Pentagon, and especially when he
Speaker 2: was under questioned from senators on his views around things
Speaker 2: like DEI or women in combat, was this notion that
Speaker 2: some of these initiatives that we have seen in recent years,
Speaker 2: whether it is allowing more equal gender opportunity or keeping
Speaker 2: diversity equity and inclusion in mind that it was slowing
Speaker 2: down the Pentagon or somehow making the Department of Defense
Speaker 2: less able to be the most lethal fighting force in
Speaker 2: the world. Is there any real truth in that statement
Speaker 2: that these other initiatives that were described in this hearing
Speaker 2: as being politically oriented issues are actually affecting the defense
Speaker 2: capability of the United States.
Speaker 8: I don't have the in depth knowledge to evaluate whether
Speaker 8: that's been harmful or helpful or neither. When I interact
Speaker 8: with as an outsider, with our troops around the world,
Speaker 8: with our military leaders around the world, I find them
Speaker 8: engaged and strong and smart and practical, and I think
Speaker 8: our military leaders are doing an extraordinary job managing a
Speaker 8: really complex to geopolitical environment. And I just want to
Speaker 8: get back to that because if you look at the
Speaker 8: challenges we're facing now. We talk briefly about the Indo
Speaker 8: Pacific the Ukraine War. Even if President Trump would like
Speaker 8: it to end on day one of his presidency, that's unlikely.
Speaker 8: You need to bring that conflict to a managed conclusion,
Speaker 8: and that involves working well with our allies. I know
Speaker 8: that the Supreme Allied Commander we currently have in Europe
Speaker 8: has done a great job with that, so that continues.
Speaker 8: What's going on in the Middle East is ending, but
Speaker 8: very slowly. You need to continue to manage Hezbollah, you
Speaker 8: need to manage the conflict in Gaza with Israel. So
Speaker 8: supporting our military to the best of our ability is
Speaker 8: going to be a very important thing, both for the
Speaker 8: Congress and for the new civilians in the administration.
Speaker 5: There's been a lot of talk about same day confirmations
Speaker 5: or day one confirmations. I should say, will Pete Hegseth
Speaker 5: be among them, assuming that Democrats play along or Republicans
Speaker 5: have the vote on January twentieth confirmed to be the
Speaker 5: next secretary.
Speaker 8: I can't speculate to that. You'll have to continue to
Speaker 8: hear the hearings well.
Speaker 2: When we consider though the urgency senators may feel, or
Speaker 2: that the President may feel in making sure that these
Speaker 2: and him and other nominees are confirmed quickly, it does
Speaker 2: speak to some of the very things that you were
Speaker 2: just discussing with us, this notion that we are at
Speaker 2: a very tense time geopolitically in many parts of the world.
Speaker 2: There has been a lot of conversation, including just yesterday
Speaker 2: here at Bloomberg when the outgoing US National Security Advisor
Speaker 2: Jake Sullivan joined our colleague about this notion that the
Speaker 2: Biden administration initially came in wanting to be able to
Speaker 2: focus on the Indo Pacific, on the threat from China,
Speaker 2: and got instead sidelined by the events in the Middle East.
Speaker 2: How do you see the kind of balance between these
Speaker 2: different theaters heading into this next administration over the course
Speaker 2: of the next four years, especially if there is some
Speaker 2: kind of at least temporary resolution between Israel and Hamas
Speaker 2: that all sides are fighting for right now.
Speaker 8: Yeah, the Middle East just draws people back in over
Speaker 8: and over again, and as much as repeated US administrations
Speaker 8: have wanted to wash their hands of it and walk away, unfortunately,
Speaker 8: we need to be engaged. That doesn't mean directly involve
Speaker 8: in war, but we need to be engaged in the
Speaker 8: world to prevent wars, to keep us from having to
Speaker 8: be directly involved, because the international geopolitical system hates a vacuum,
Speaker 8: and every time there's a vacuum, it's filled, frankly by
Speaker 8: the bad guys. Like you saw Russia filling in in Syria.
Speaker 8: You've seen Russia invade Ukraine, You've seen an increasingly belligerent China.
Speaker 8: That we need to be watching. So we don't have
Speaker 8: the leisure as leaders in the United States to turn
Speaker 8: away from any of these very important conflicts. We need
Speaker 8: to be engaged in all of them. And if you
Speaker 8: talk to our friends and partners around the world, they
Speaker 8: want us to continue to be engaged.
Speaker 5: All right, Doctor anyat Manuel Co Federal, the strategic consulting
Speaker 5: firm Rice Headley Gates Manual, we thank you so much,
Speaker 5: thanks for listening to the Balance of Power podcast. Make
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