WEBVTT - Surveillance: Biden’s Stimulus Plans With Hubbard 0:00:09.840 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene. Daily 0:00:13.960 --> 0:00:17.560 we bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.480 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.640 --> 0:00:27.560 Bloomberg dot Com, and of course on the Bloomberg. Right now, 0:00:27.640 --> 0:00:30.600 we're going to attempt an intelligent conversation. I turned to 0:00:30.680 --> 0:00:33.559 Mrs Keene at the ten o'clock hour last night and 0:00:33.600 --> 0:00:36.640 I said, you know, I figure Wheeler will cancel is 0:00:36.680 --> 0:00:40.879 Ohio State went down in flames? Tom Wheeler, your comment 0:00:41.000 --> 0:00:44.280 on the spirit of college football in the time of 0:00:44.320 --> 0:00:51.240 this national crisis. My comment is, go Buckeyes. Think about 0:00:51.320 --> 0:00:55.320 what brought you there, not just the outcome, but it 0:00:55.400 --> 0:00:58.360 was a tragedy lesson. He is a former FCC chairman, 0:00:58.400 --> 0:01:02.000 and we're thrilled to Thomas Wheeler could join us this morning. Tom. 0:01:02.040 --> 0:01:04.640 I don't like the phrase in net neutrality. It's Greek 0:01:04.720 --> 0:01:08.400 to me um, But tell us what the net looks 0:01:08.480 --> 0:01:11.800 like in two or three years. We are evolving each 0:01:11.840 --> 0:01:16.480 and every day. With Fiorina and Wheeler on the same page, 0:01:16.560 --> 0:01:22.560 what does our FCC world look like in five years? Well, 0:01:22.640 --> 0:01:24.880 I think that what is important is we've got to 0:01:24.880 --> 0:01:28.800 think about what the new world looks like. That, um, 0:01:29.200 --> 0:01:36.160 that we have been trying to oversee, um the revolution 0:01:36.480 --> 0:01:42.679 of the digital economy and digital technology using statutes and 0:01:42.760 --> 0:01:47.400 regulatory structures that were created for the industrial era. And 0:01:47.520 --> 0:01:51.960 we need a new approach that recognizes that the world 0:01:52.160 --> 0:01:56.240 has changed, that things move much more quickly than they 0:01:56.320 --> 0:01:59.880 did before, and so we can't have the old scarrot 0:02:00.200 --> 0:02:04.920 approach to oversight. And and secondly that we're dealing with 0:02:04.960 --> 0:02:10.120 a whole new class of assets, soft assets instead of 0:02:10.160 --> 0:02:13.440 hard assets, and they behave differently in the marketplace. All Right, 0:02:13.560 --> 0:02:15.440 So Tom, let's bring this to what happened over the 0:02:15.480 --> 0:02:18.519 past week or so. We saw Twitter band President Trump 0:02:18.520 --> 0:02:22.799 from its platform, Facebook suspending him from There's raising a 0:02:22.919 --> 0:02:28.320 question about big text rule in really determining the discourse 0:02:28.480 --> 0:02:31.240 in the nation and frankly in the world. What is 0:02:31.280 --> 0:02:34.480 the government's rule in dictating the guidelines for some of 0:02:34.480 --> 0:02:38.239 these big tech companies. Well, I think Creli fi Arena 0:02:38.480 --> 0:02:41.040 hit the nail on the head. And this is the 0:02:41.080 --> 0:02:44.679 basis for things that I've been writing saying saying that Look, um, 0:02:45.600 --> 0:02:49.400 what's been going on is the technology companies have assumed 0:02:50.160 --> 0:02:55.760 quasi governmental role. They are making the rules because our 0:02:55.800 --> 0:03:00.800 representatives in government are not. And we even step up 0:03:01.040 --> 0:03:05.359 and figure out, um, as the people, what are the 0:03:05.480 --> 0:03:10.400 rules that um that that should should exist. How do 0:03:10.480 --> 0:03:15.880 we have competition instead of these monopolies. How do we 0:03:16.000 --> 0:03:23.160 have expectations for responsible behavior rather than um, well, we'll 0:03:23.160 --> 0:03:27.240 do whatever we want because it's profitable. But but but, Tom, 0:03:27.320 --> 0:03:29.440 I mean, you talk about these concepts and there's very 0:03:29.440 --> 0:03:33.160 little agreement on exactly how to frame uh these issues. 0:03:33.240 --> 0:03:35.520 We can't even get a stimulus effort pass, and we 0:03:35.560 --> 0:03:38.480 have a jobless rate that's incredibly high. I mean, what 0:03:38.600 --> 0:03:41.280 is your confidence level that there actually is some consensus 0:03:41.480 --> 0:03:46.720 on these big philosophical concepts in Washington, d C. Lisa, 0:03:47.040 --> 0:03:48.840 I think this goes back to our discussion of the 0:03:48.840 --> 0:03:51.640 game last night. You know, I think you need to 0:03:51.760 --> 0:03:55.480 have the willingness to get on the field and to 0:03:55.680 --> 0:03:59.920 try and work it out rather than just running away 0:04:00.120 --> 0:04:02.160 from it, and which is frankly what we've done for 0:04:02.200 --> 0:04:04.240 too long. You know. One of the things that happened 0:04:04.320 --> 0:04:07.720 is that is that policymakers have been sold. For the 0:04:07.760 --> 0:04:10.720 last couple of decades, policy makers have been sold this 0:04:11.080 --> 0:04:17.920 snake oil that that somehow digital is different and that 0:04:18.040 --> 0:04:23.600 it's pretty close to magic, and if you do anything 0:04:23.800 --> 0:04:30.080 to provide public interest oversight, you'll break that magic. That's 0:04:30.400 --> 0:04:35.560 not the case, and we need to have policy makers 0:04:35.839 --> 0:04:39.000 who understand and I think they are coming up to speed, 0:04:39.200 --> 0:04:43.159 who understand the realities of the digital economy, and they 0:04:43.120 --> 0:04:45.240 are willing to step up. I mean, let's go back 0:04:45.360 --> 0:04:49.680 in history for just a second. The regulatory structures that 0:04:49.720 --> 0:04:54.400 we have in place right now, we're created to provide 0:04:54.480 --> 0:05:01.680 balance in the industrial economy to the inherent incentive to 0:05:01.839 --> 0:05:06.080 excess that was created at that point in time. We 0:05:06.200 --> 0:05:11.920 need to have some kind of an offsetting, countervailing structure 0:05:12.400 --> 0:05:17.240 created in the digital economy. But we can't rely on 0:05:17.320 --> 0:05:21.240 the structures that were created for a hundred years ago, 0:05:21.680 --> 0:05:24.400 because it's a new world. Tom Well, I want to 0:05:24.440 --> 0:05:27.400 talk about your wonderful work in the Civil War, your 0:05:27.440 --> 0:05:30.440 book Take Command on Leadership, and then you talk about 0:05:30.520 --> 0:05:33.559 taking the next hill. We've got to take the next 0:05:33.600 --> 0:05:38.560 technology hill. Do you assume whatever that technology hill looks like, 0:05:38.760 --> 0:05:41.640 and let's say I see Ohio regiments at Gettysburg, do 0:05:41.720 --> 0:05:48.000 you just assume that's a breakup of these technology companies no, Tom, 0:05:48.520 --> 0:05:51.640 I think that what you have to do, uh, you know, 0:05:51.680 --> 0:05:53.640 another chapter in the book talks about you've got to 0:05:53.640 --> 0:05:56.280 look at new techniques and new and have new thoughts 0:05:56.839 --> 0:06:00.800 because because you know, I don't want to break up 0:06:00.880 --> 0:06:04.960 Facebook and have half a dozen mini me facebooks, all 0:06:05.120 --> 0:06:10.040 with the incentive to use their monopoly power over the 0:06:10.120 --> 0:06:15.080 digital assets which they hold and won't share with anybody else. 0:06:15.520 --> 0:06:19.000 I would rather see, let's have instead of break up, 0:06:19.480 --> 0:06:24.120 let's break open access to those assets. Let me give 0:06:24.160 --> 0:06:29.200 you one specific example. In ninety six, A T and 0:06:29.320 --> 0:06:35.279 T was forced to open access to its patents, which 0:06:35.400 --> 0:06:39.360 was the greatest repository of of patents in the world. 0:06:40.080 --> 0:06:46.640 And when that happened, innovation and competition took off. They 0:06:46.640 --> 0:06:53.720 had been using those patents to thwart others from creating 0:06:53.800 --> 0:06:58.800 competitive alternatives. And what we need to do is say, Okay, 0:06:58.839 --> 0:07:02.520 these companies are now sitting on massive databases. We will 0:07:02.520 --> 0:07:07.560 never be able to compete with them if they continue 0:07:07.600 --> 0:07:11.200 to hoard those databases. You need to open the databases 0:07:11.400 --> 0:07:14.960 for free. Not for free, but you need to provide 0:07:15.040 --> 0:07:18.520 access to the essential essential for the digital economy to 0:07:18.600 --> 0:07:21.080 right now. Controversial to say, at least Thomas Wheeler thinking 0:07:21.200 --> 0:07:29.600 so much greatly appreciated. Stephen Whiting is with that Morrisett 0:07:29.680 --> 0:07:32.200 City Group, City Group Private Bank, and he joins us 0:07:32.720 --> 0:07:35.800 this morning. Stephen Whiting, do you readjust your two thousand 0:07:36.240 --> 0:07:38.679 one view with the two amult of the first twelve 0:07:38.760 --> 0:07:44.040 days of this year? We don't not because of political 0:07:44.200 --> 0:07:48.040 shocks like this. I think when we look back at history, 0:07:48.320 --> 0:07:51.360 we can find twenty events all the way back and 0:07:51.440 --> 0:07:55.360 including World War Two that really qualify as political or 0:07:55.400 --> 0:07:59.880 geopolitical shocks. Only two of them really turned to direct 0:08:00.040 --> 0:08:02.880 and of the world economy. And this is one that 0:08:02.920 --> 0:08:04.840 I would doubt is going to turn the direction of 0:08:04.840 --> 0:08:08.280 the world economy. And for all those that didn't, the 0:08:08.320 --> 0:08:11.520 effects and financial markets weren't felt for more than ninety days. 0:08:12.680 --> 0:08:14.400 Let's see, I want you to have common on ed 0:08:14.480 --> 0:08:17.120 Morris and oil to sixty as well. You've got frontline 0:08:17.120 --> 0:08:20.800 commodity work filtering in the City Group Private Bank. How 0:08:20.800 --> 0:08:25.040 do you filter in the work of Edward Morris. Remarkably, 0:08:25.160 --> 0:08:29.840 because it's across asset classes, it's powerful when we understand 0:08:29.960 --> 0:08:33.080 what's going on in the oil market in particular more 0:08:33.080 --> 0:08:36.800 than other commodities, but certainly in commodities like copper and 0:08:36.920 --> 0:08:42.080 iron ore um. These might have directly relatively small shares 0:08:42.480 --> 0:08:46.400 of economic activity, but the sensitivities to credit, the movements 0:08:46.440 --> 0:08:50.120 and currencies, the read through the broader asset allocation, it's 0:08:50.160 --> 0:08:53.480 been really powerful. So it's been a fantastic contributor to 0:08:53.480 --> 0:08:55.959 to our work in terms of broader asset allocation, even 0:08:55.960 --> 0:08:59.800 beyond commodities. So what you're saying is that you've either 0:09:00.000 --> 0:09:02.360 flation trade. Is that what you're saying, Oh, I do 0:09:02.480 --> 0:09:05.920 because I believe in a vaccine. Uh. And we see 0:09:05.960 --> 0:09:10.960 already with just three producers, probably five billion vaccine doses 0:09:11.520 --> 0:09:14.360 will be distributed over the course of one and that's 0:09:14.440 --> 0:09:18.320 not the end of the vaccine pipeline. Uh. And you 0:09:18.320 --> 0:09:20.200 can hear it from the Federal Reserve if you don't 0:09:20.200 --> 0:09:23.240 want to believe me, that the course of the virus, 0:09:23.360 --> 0:09:26.559 the pandemic, and the vaccines will really determine the course 0:09:26.720 --> 0:09:31.199 of the future economy. This has been uh in external 0:09:31.360 --> 0:09:35.920 exogenous shock. We came into this event relatively healthy, with 0:09:36.000 --> 0:09:39.840 low inflation rates, no booms in any industries, and this 0:09:40.040 --> 0:09:44.240 virus knocked us down incredibly deeply. It's changed every asset 0:09:44.280 --> 0:09:46.920 price in the world. And when it leaves, it will 0:09:47.000 --> 0:09:50.040 change every asset price in the world. Uh. And there's 0:09:50.080 --> 0:09:52.760 a lot of the economy that can still be restored 0:09:53.240 --> 0:09:57.440 uh in later as it departs. All right, So in 0:09:57.480 --> 0:09:59.920 the near term, how are you looking at the vACC 0:10:00.200 --> 0:10:02.880 nations in order to determine your investing thesis? We were 0:10:02.880 --> 0:10:06.000 speaking with Mark McCormick about how he's tracking which nations 0:10:06.000 --> 0:10:09.360 are doing the best job of getting vaccines into our arms. 0:10:09.440 --> 0:10:11.480 Are you doing the same to determine where the world 0:10:11.480 --> 0:10:16.000 to invest? Well, it's no surprise, for example, that throughout 0:10:16.120 --> 0:10:20.640 Asia the pervasiveness of the virus has been lowered. Maybe 0:10:20.640 --> 0:10:24.560 it's the experience with stars for example, very very high 0:10:24.640 --> 0:10:28.160 compliance with mast wearing right has had a different economic 0:10:28.200 --> 0:10:31.560 impact there. Um. I just think that we are very 0:10:31.640 --> 0:10:33.920 early on in terms of vaccination. I mean, it is 0:10:33.960 --> 0:10:38.920 fairly miraculous that we have effective vaccines at the levels 0:10:38.960 --> 0:10:44.280 that we are seeing. Right. Epidemiologists expected efficacy, you know, 0:10:44.280 --> 0:10:47.120 a little bit closer to fluid vaccines, and here we 0:10:47.160 --> 0:10:50.800 are with some of these well above nine. The rollout 0:10:50.840 --> 0:10:53.080 may be slow, but I think this is a little 0:10:53.120 --> 0:10:56.360 bit like sand than a sieve. Right, It'll move faster 0:10:56.960 --> 0:11:00.200 as we as we go forward, right, So equipping about 0:11:00.240 --> 0:11:01.560 a couple of months is not something that I'm going 0:11:01.600 --> 0:11:04.559 to do with asset allocation. Steve whing been Layler over 0:11:04.600 --> 0:11:07.800 Tower Hudson very courageously. He's been dead out on optimism 0:11:07.840 --> 0:11:10.559 on the equity markets cost for three years of double 0:11:10.600 --> 0:11:13.360 digit return he says, there's a not certitude, but a 0:11:13.480 --> 0:11:16.280 likelihood of that you and I have lived in the 0:11:16.400 --> 0:11:20.560 certitude of single digit returns. Is that where we finally 0:11:20.679 --> 0:11:27.439 are We look, we're not expecting returns as robust as 0:11:27.520 --> 0:11:30.960 on headline, especially for US equities where we had a 0:11:31.000 --> 0:11:34.640 lot of defensive equities in the technology sector. They provided 0:11:34.640 --> 0:11:38.480 the solutions to the COVID economy. Their valuations were driven 0:11:38.559 --> 0:11:41.520 up by falling interest rates, right, So it's more than 0:11:41.559 --> 0:11:45.160 the durability of their earnings. But there's that invaluation. So 0:11:45.200 --> 0:11:47.560 we're not expecting to be as strong as last year's 0:11:48.240 --> 0:11:51.319 return for US equities. But there's a lot around the 0:11:51.360 --> 0:11:54.360 world right now where of our equity overweight is outside 0:11:54.360 --> 0:11:57.320 the United States, where we've seen some pockets of the 0:11:57.360 --> 0:12:01.640 world lag badly behind. Now when we think back to 0:12:01.679 --> 0:12:04.880 two thousand nine, where conditions perfectly lost jobs, the entirety 0:12:04.880 --> 0:12:07.280 of two thousand nine. That was a thirty five percent 0:12:07.400 --> 0:12:10.480 game right for global equities in that year, less for 0:12:10.520 --> 0:12:12.200 the United States, more for the rest of the world. 0:12:12.720 --> 0:12:17.199 People thought the expansion was over, that we priced in recovery. 0:12:17.200 --> 0:12:19.520 It's now time, you know, the wait for the next crisis. 0:12:19.880 --> 0:12:23.360 We then went on to ten years in which we 0:12:23.400 --> 0:12:27.360 had a game in global equities games and nine out 0:12:27.400 --> 0:12:30.360 of eleven years and what was the returning cash over 0:12:30.360 --> 0:12:34.120 the time six percent annuals. Yeah, well, Steve, what's the 0:12:34.160 --> 0:12:37.480 distinction of the city gro view on markets in one 0:12:37.520 --> 0:12:39.520 given Then what you've laid out is very much or 0:12:39.640 --> 0:12:42.719 hearing from most people on the show. Well, I think 0:12:42.760 --> 0:12:48.520 again it's discriminating between which assets will really move that 0:12:48.679 --> 0:12:52.080 there are these shorter term dislocations that are quite severe. 0:12:52.120 --> 0:12:56.480 We've been overweight small cap US equities for a good 0:12:56.480 --> 0:13:00.880 period of time in that has mean reverted pretty significantly. 0:13:01.559 --> 0:13:05.240 Latin America, Southeast Asia, these are markets that have not 0:13:05.400 --> 0:13:07.800 come back nearly as much. The fact that there's a 0:13:07.880 --> 0:13:12.920 strong correlation between what you mentioned earlier um At morses 0:13:13.040 --> 0:13:16.000 you on oil and financial stocks that sort of are 0:13:16.200 --> 0:13:20.240 priced as if they are their businesses reflect the worst 0:13:20.280 --> 0:13:23.640 of the credit conditions of the most impacted industries. These 0:13:23.679 --> 0:13:25.640 are areas again that we'd be bullish on for a 0:13:25.720 --> 0:13:29.840 practical revaient. Now, when we get all through with these distortions, 0:13:30.160 --> 0:13:33.640 we're gonna focus in on a different set of opportunities. 0:13:33.640 --> 0:13:36.200 Some of these are really long term growth opportunities, like 0:13:36.280 --> 0:13:39.200 the fact that we've only had a minimal amount of 0:13:39.280 --> 0:13:44.000 shift in the world to uh to greener technologies, right 0:13:44.360 --> 0:13:49.359 electrification that you are thematic opportunities that are really incipient, 0:13:49.480 --> 0:13:53.800 just the way e commerce was ten years ago. Stephen Whiting, UH, 0:13:54.040 --> 0:13:56.080 just fascinating. Thank you so much. We're gonna have to 0:13:56.120 --> 0:13:58.240 leave it there right now. With the death Stephen Whiting 0:13:58.280 --> 0:14:05.360 of City Group, Private Think, Thank you so much. Julie 0:14:05.360 --> 0:14:08.320 Norman with us right now, Lisa Brownwittson, Tom King, your 0:14:08.400 --> 0:14:13.160 simulcast Professor Norman at the University College London. And you know, Professor, 0:14:13.200 --> 0:14:15.920 we've done different things here, including the TikTok with Kevin 0:14:16.000 --> 0:14:18.280 Surreali and the rest of it. I want to look 0:14:18.320 --> 0:14:23.119 forward with you, Professor, to the new grid Luck Democratic President, 0:14:23.480 --> 0:14:31.840 Democratic Senate, Democratic House. Why are we even talking about Gridlock? Well, Tom, 0:14:31.840 --> 0:14:33.400 I think there's always going to be a bit of 0:14:33.400 --> 0:14:38.000 gridlock in Washington, but for Biden especially, Yes, he does 0:14:38.080 --> 0:14:42.000 have a majority now in the Senate after the Georgia runoffs, 0:14:42.000 --> 0:14:45.240 but that is an extremely when majority with the Senate 0:14:45.240 --> 0:14:47.920 being fifty fifty and just having the vice president as 0:14:47.920 --> 0:14:52.040 a tiebreaker and only a four seat majority in the House, 0:14:52.120 --> 0:14:56.240 one of this limits in recent memory. So just because 0:14:56.280 --> 0:14:59.000 of that, it's going to be tough to that legislation through, 0:14:59.320 --> 0:15:03.480 especially in the Senate, where most meaningful legislation requires sixty votes, 0:15:03.640 --> 0:15:07.480 not just the simple majority, and even more than that. 0:15:07.520 --> 0:15:12.200 There's some uh surmising sometimes that having a closed House 0:15:12.200 --> 0:15:16.600 and a close Senate increases opportunities for compromise and partisanship, 0:15:17.000 --> 0:15:20.160 but in fact we sometimes see the opposite that in fact, 0:15:20.280 --> 0:15:23.560 often the minority party is even less likely to compromise 0:15:23.840 --> 0:15:26.080 in those situations because they don't want to give the 0:15:26.120 --> 0:15:31.720 majority a win. If we somehow get beyond our national catastrophe, 0:15:32.280 --> 0:15:36.160 how does a minority react to not owning either of 0:15:36.240 --> 0:15:39.680 the three houses? What what do the Republicans do? Based 0:15:39.720 --> 0:15:45.520 on histories? Take well, what we've seen historically is that 0:15:45.600 --> 0:15:49.200 again whichever party is the minority, Republicans or Democrats, Republicans 0:15:49.240 --> 0:15:52.200 in this case um which I instag me some of 0:15:52.240 --> 0:15:55.800 that legislation that the majority party wants to put through. 0:15:56.320 --> 0:15:59.960 For Joe Biden and for Democrats right now, the emphasis 0:16:00.040 --> 0:16:03.840 will most likely see on further stimulus bills for the 0:16:03.960 --> 0:16:06.840 Corona relief. We can expect that there will be some 0:16:06.880 --> 0:16:10.440 opposition to that in the Senate, starting with opposition to 0:16:10.480 --> 0:16:14.800 say the increase of two thousand dollar checks or increasing 0:16:14.800 --> 0:16:17.080 some of the age to state and local governments. So 0:16:17.160 --> 0:16:20.200 we'll see some kind of digging in and just trying 0:16:20.280 --> 0:16:24.960 to create some variers of having that legislation go through smoothly. Julie. Meantime, 0:16:25.000 --> 0:16:28.480 we're talking about impeachment yet again in Congress, even though 0:16:28.520 --> 0:16:32.400 we have eight more days of President Trump's tenure. Is 0:16:32.440 --> 0:16:36.120 this more of a damaging effect on Joe Biden's entry 0:16:36.120 --> 0:16:39.280 into the presidency than it is help to the Democrats? 0:16:41.080 --> 0:16:43.600 Well visa, I think that's a big question for Democrats 0:16:43.760 --> 0:16:46.600 right now. Certainly, Joe Biden has not thrown his weight 0:16:46.680 --> 0:16:49.800 behind the impeachment for speedings. He's pretty much just said 0:16:49.840 --> 0:16:54.280 all that Congress do what they decide. However, Providen definitely 0:16:54.320 --> 0:16:56.920 wants to be able to hit the ground running. He 0:16:57.000 --> 0:16:59.320 wants to be able to have his cabinet members and 0:16:59.440 --> 0:17:03.280 especially his national security team confirmed right away. He wants 0:17:03.320 --> 0:17:06.240 to get to work on the vaccination program and also 0:17:06.320 --> 0:17:09.520 again on some of this relief and stimulus bills. And 0:17:09.560 --> 0:17:12.080 he really doesn't want the whole Senate ground to a 0:17:12.200 --> 0:17:17.360 hold over an impeachment proceeding, especially one that is unlikely 0:17:17.359 --> 0:17:20.240 to even get all the votes. Theory for a two 0:17:20.560 --> 0:17:24.320 conviction to borrow Chump from the future office, and you know, 0:17:24.400 --> 0:17:27.719 something said to this also divide the country further, just 0:17:27.840 --> 0:17:33.160 deepen grievances and undermine Itiden pull messaging around unity and healing. 0:17:33.520 --> 0:17:35.959 So I'm sure that's certainly on his mind too, although 0:17:36.080 --> 0:17:37.879 his team is trying to spend it as more of 0:17:37.920 --> 0:17:41.320 an opportunity than a than a deepening problem right now. 0:17:41.480 --> 0:17:44.160 But it's going to be an upho battle for Biden regardless, 0:17:44.240 --> 0:17:46.679 and an impeachment is going to make it even trickier 0:17:46.720 --> 0:17:48.960 for him to navigate those waters. Yeah, I mean, I've 0:17:48.960 --> 0:17:50.720 been I've been wondering, you know, what's the point at 0:17:50.760 --> 0:17:52.680 a certain point, if it's not going to get through, 0:17:52.720 --> 0:17:55.480 if they're not going to actually get Trump out of office, 0:17:55.480 --> 0:17:58.639 he only has eight days left, why go through this exercise, 0:17:58.720 --> 0:18:01.040 and some people have arguable for as this has international 0:18:01.119 --> 0:18:05.240 ramifications in terms of edifying the United States view as 0:18:05.359 --> 0:18:08.919 a democracy that's united, do you have any sympathy for 0:18:08.960 --> 0:18:14.240 that view? Well, there certainly is the sense of what 0:18:14.359 --> 0:18:16.840 this looks like to the rest of the world. Obviously, 0:18:16.920 --> 0:18:20.720 the images from last week many saw as really hurting 0:18:20.760 --> 0:18:23.399 the global image of the US as a sort of 0:18:23.880 --> 0:18:27.880 similar bastion of democracy. I think it's more important though 0:18:27.960 --> 0:18:32.080 for internal messaging and optics to remote democrats, the sense 0:18:32.119 --> 0:18:35.920 of saying to their own voters into the country more broadly, 0:18:36.359 --> 0:18:40.320 that this kind of behavior, this kind of incitement, can't 0:18:40.359 --> 0:18:44.879 be a precedent and essentially saying that this is that 0:18:45.000 --> 0:18:47.800 the body would be without integrity if they didn't pursue 0:18:47.880 --> 0:18:51.600 impeachment proceedings because of this. However, again, the pragmatics and 0:18:51.600 --> 0:18:55.159 the practicalities around it do make this difficult. They know 0:18:55.280 --> 0:18:58.280 that they can't remove from office and might be making 0:18:58.280 --> 0:19:01.479 things hard for Biden at the same time. One final question, 0:19:01.480 --> 0:19:04.080 and we can do this with Julie Norman. She is 0:19:04.240 --> 0:19:09.000 wonderful on the tensions of politics. Julie, this has been 0:19:09.119 --> 0:19:12.560 under our radar because of the news flow and this 0:19:12.640 --> 0:19:15.679 is the foreign policy exit of the Trump administration on 0:19:15.840 --> 0:19:22.280 Cuba and particularly overnight on Yemen. This was a heated 0:19:22.560 --> 0:19:29.160 report reported folks, heated exchange between legislative staff members and Mr. 0:19:29.240 --> 0:19:33.120 Pompeo in his State department. Julie Norman explained to our 0:19:33.160 --> 0:19:38.560 audience why these discussions on Yemen are so so heated 0:19:38.760 --> 0:19:44.399 in Washington. There was the discussions around Yemen and Yemen 0:19:44.480 --> 0:19:47.200 a country in the Middle East and the Gulf that 0:19:47.280 --> 0:19:50.600 has really been stuffering from a quite severe civil war 0:19:50.760 --> 0:19:54.200 for for years now. Pompey was preferring to declare one 0:19:54.240 --> 0:19:57.800 of the groups, the Footie Group, a terrorist group. Laboring 0:19:58.160 --> 0:20:02.359 any group a terrorist group has very significant rampiprocations in 0:20:02.440 --> 0:20:04.800 terms of what kind of aid can go to the country, 0:20:04.920 --> 0:20:08.080 in terms of what kind of political conversation can happen 0:20:08.119 --> 0:20:12.360 with that group for peace processes and negotiations, and also 0:20:12.400 --> 0:20:15.280 just start puts the US on a kind of very 0:20:15.320 --> 0:20:18.080 different political expance on that conflict that they've already done on. 0:20:18.200 --> 0:20:21.320 Do you assume that doesn't just because of time, Julie, 0:20:21.359 --> 0:20:25.040 to complete the circle. Do you assume that President Biden 0:20:25.200 --> 0:20:28.399 and his team can reverse that decision if they choose. 0:20:30.200 --> 0:20:33.080 I do think they will try again. The team is 0:20:33.119 --> 0:20:35.399 pretty pragmatic. They're going to want to leave all options 0:20:35.480 --> 0:20:39.360 open for negotiations and diplomacy, and the terrorism label inhibits 0:20:39.400 --> 0:20:42.760 that rather than facilitate that. That's why we love Julie Norman. 0:20:42.800 --> 0:20:45.199 I can take a tangent like that, and there she 0:20:45.440 --> 0:20:48.879 is with expert views Julie Norman with u c L 0:20:52.920 --> 0:20:55.439 right now on the economics of the moment. It is 0:20:55.520 --> 0:20:59.240 always good to speak to Glenn Hubbard, Columbia professor of economics, 0:20:59.280 --> 0:21:02.800 a former Airmen of the Council of Economic Advisors under 0:21:02.840 --> 0:21:05.679 President Bush, and I do want to part here that 0:21:05.760 --> 0:21:10.720 with the late Edward Lizier were the giants of conservative growth. 0:21:10.800 --> 0:21:15.119 The certitude that growth was good and incentivizing our private 0:21:15.160 --> 0:21:18.800 economy was to way to get it. Uh don, Glenn, 0:21:18.800 --> 0:21:21.280 I want you to speak for ed Lazier. What a loss. 0:21:21.359 --> 0:21:24.280 But right now, Glenn Hubbard, there has to be an 0:21:24.280 --> 0:21:28.679 optimism about a return to American growth. We have a 0:21:28.840 --> 0:21:34.159 rising debt, arising deficit from a natural natural disaster. Do 0:21:34.280 --> 0:21:38.280 you suggest that we can see American growth out of 0:21:38.320 --> 0:21:42.240 this terrible tragedy that we face. I think we can. 0:21:42.400 --> 0:21:46.600 I mean Obviously, there's almost nothing good about COVID nineteen, 0:21:46.720 --> 0:21:50.280 but the pace of innovation we're seeing is truly amazing, 0:21:50.400 --> 0:21:52.560 and every business leader I think believes were well in 0:21:52.600 --> 0:21:56.119 the interior of the productivity growth frontier. I think as 0:21:56.160 --> 0:22:00.480 long as policy focuses on recovery and renewal and reform, 0:22:00.480 --> 0:22:02.880 we're going to get there. And what was so distinctive here, 0:22:02.920 --> 0:22:06.560 Glenn Hubard, with your work and also Dul's ears, as 0:22:06.600 --> 0:22:10.920 you said, caffeinated enthusiasm, there has to be an American 0:22:11.080 --> 0:22:16.439 initiative that is different. Is that exceptionalism still there? I 0:22:16.480 --> 0:22:18.800 think there is. You know, whether you're talking about public 0:22:18.880 --> 0:22:22.600 policy or private goals, the idea of a moonshot is important. 0:22:22.960 --> 0:22:25.960 If you look at the pace of development of vaccines 0:22:26.040 --> 0:22:28.760 for COVID nineteen, you see an example of what I'm 0:22:28.800 --> 0:22:31.879 talking about, and we can see that throughout the economy. 0:22:31.920 --> 0:22:34.560 And I think a task for our new president will 0:22:34.600 --> 0:22:37.720 be to try to make sure that that spirit is there, 0:22:37.800 --> 0:22:42.679 both publicly and privately. Glenn, how quickly can we return 0:22:42.720 --> 0:22:45.760 back to normal? There are many questions even if people 0:22:45.800 --> 0:22:48.680 get vaccinated, how long you get protected for? So we 0:22:48.960 --> 0:22:54.159 are we overthinking that? You know that once people get vaccinated, 0:22:54.240 --> 0:22:57.840 we go back to normal economically. See, I'm not sure 0:22:57.880 --> 0:23:00.200 what normal will mean. We we do need to think 0:23:00.200 --> 0:23:02.240 about this in phases. So we need to make sure 0:23:02.280 --> 0:23:05.240 we have a vigorous recovery, get people back to work, 0:23:05.560 --> 0:23:08.240 make sure we support people while things are locked down. 0:23:08.800 --> 0:23:11.080 But then the economy is going to look different. People 0:23:11.119 --> 0:23:15.800 may be in different jobs. If I were advising President Biden, 0:23:16.040 --> 0:23:19.480 I would be focused on the possibility of something like 0:23:19.520 --> 0:23:22.719 a new g I bill. What's a way to retrain people, 0:23:22.880 --> 0:23:25.760 get them going. I think that's the spirit we need. 0:23:26.960 --> 0:23:29.360 But retraining into what I mean when I talk about normal, 0:23:29.400 --> 0:23:31.160 what's really thinking about Tom and I having a drink 0:23:31.200 --> 0:23:34.600 of our choice? Okay, I think you would talk to 0:23:34.720 --> 0:23:36.639 have the drink of your choice. But I'm saying the 0:23:36.760 --> 0:23:41.480 mix of businesses and jobs in the economy last February 0:23:41.720 --> 0:23:44.080 is going to look different than what it may be 0:23:44.160 --> 0:23:46.520 in the new economy, and we want to make sure 0:23:46.560 --> 0:23:50.000 that people are ready for that. Drinks and all. How 0:23:50.080 --> 0:23:53.160 different Glenn, So, is it just what we were already 0:23:53.200 --> 0:23:56.639 going through so much more e commerce, much more technology 0:23:56.720 --> 0:24:00.919 driven being accelerated, or does COVID ring team put us 0:24:00.920 --> 0:24:04.640 on a different economy path. Why don't like we know yet, 0:24:04.680 --> 0:24:06.879 But I think the acceleration is a big deal. A 0:24:06.920 --> 0:24:09.600 lot of what happened during COVID was an acceleration of 0:24:09.640 --> 0:24:13.560 trends like you mentioned with technology, e commerceince one, and 0:24:13.560 --> 0:24:16.199 that's just gonna go faster than people thought. So I 0:24:16.200 --> 0:24:18.320 think we need to make sure that we have a 0:24:18.359 --> 0:24:21.840 system for smaller midsized businesses that they can adapt, that 0:24:21.880 --> 0:24:24.399 we have an ability to help train people for the 0:24:24.480 --> 0:24:26.840 jobs that will be instead of the jobs that were. 0:24:27.880 --> 0:24:29.679 But when you talk about a g I bill in 0:24:29.680 --> 0:24:32.480 the scope of that, I'm going to take a conservative 0:24:32.520 --> 0:24:34.520 guy like you and throw you on the same page 0:24:34.520 --> 0:24:38.320 with a great liberal economist, Claudia Son. Claudia is calling 0:24:38.400 --> 0:24:41.560 for far more stimulus, and I think I'm hearing that 0:24:41.640 --> 0:24:45.080 from you as well. But what is the distinction of 0:24:45.119 --> 0:24:51.080 the application of the stimulus between conservatives and liberals. Well, 0:24:51.119 --> 0:24:53.880 I'm actually not talking about stimulus, although I do think 0:24:53.920 --> 0:24:57.240 we need another recovery package. What I'm talking about is 0:24:57.280 --> 0:25:00.320 actually a longer term program. We needed something like what 0:25:00.359 --> 0:25:02.960 I'm talking about before COVID, and we need it now. 0:25:03.480 --> 0:25:06.159 It's a way to help train people. I'm thinking of 0:25:06.240 --> 0:25:10.200 things like a block grant to interrupt. But look, we're 0:25:10.240 --> 0:25:12.760