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Speaker 2: Happy Friday to everyone.
Speaker 3: What a week it has been.
Speaker 2: What a several weeks, honestly, and a lot seems to
Speaker 2: have changed in just the last couple of weeks, because,
Speaker 2: of course, it was just about what two and a
Speaker 2: half weeks ago that the Fed cut rates by fifty
Speaker 2: basis points out of concern about protecting the labor market,
Speaker 2: not wanting to see it deteriorate further. And then today
Speaker 2: we get a picture of strength in the labor market,
Speaker 2: maybe not in all sectors. Manufacturing is a week spot,
Speaker 2: but at lower unemployment rate, a blowout on non farm payrolls,
Speaker 2: and the market now saying, all right, maybe the Fed's
Speaker 2: not only not going to cut fifty basis points again
Speaker 2: in November, not even pricing a full twenty five basis
Speaker 2: point cut.
Speaker 4: Well, there's nothing manic about this, obviously, knowing that we
Speaker 4: had massive downward revisions on a series of reports throughout
Speaker 4: the summer. Bloomberg Economics is already saying that October number
Speaker 4: that's going to come right before the election, by the way,
Speaker 4: may not look very good. And there's a lot of
Speaker 4: noise in this report. So I'm curious with Catherine Edwards
Speaker 4: thinks about this. She's back with us at the table
Speaker 4: here in Washington, economic policy consultant and contributor to Bloomberg Opinion, Catherine,
Speaker 4: thank you. Are we ever going to get this right?
Speaker 4: How come we're so far off for better or worse
Speaker 4: every month?
Speaker 3: We just haven't been here before.
Speaker 5: I mean, how many times have we come down from
Speaker 5: historically high inflation without landing in a recession and get
Speaker 5: interest rates down, keep unemployment right down. We're all in
Speaker 5: some ways in uncharted waters, and so it's not surprising
Speaker 5: to me.
Speaker 3: I mean, we were going over the forecast this morning.
Speaker 5: They ranged from seventy thousand to two twenty, and the consensus.
Speaker 3: Was really just whatever was in the middle.
Speaker 5: I think there's a lot that people don't know of
Speaker 5: what the next six months looks like, and that's okay.
Speaker 5: I mean, the economy itself told us this morning that
Speaker 5: the labor market is strong. That's the most important takeaway.
Speaker 2: Well, the last time you were here in the studio
Speaker 2: with us, it was right before that FED rate decision,
Speaker 2: when you were talking about a little bit of concern
Speaker 2: you had in the labor market and your hope that
Speaker 2: the FED would recognize that and perhaps go fifty, which
Speaker 2: of course they did. So riddle me this then, Catherine,
Speaker 2: do you still have that same concern today? Is there
Speaker 2: something that's not in the headline data that you're paying
Speaker 2: attention to.
Speaker 5: Yes, the biggest concern in the US labor market right
Speaker 5: now is hiring. Hiring rates are at where they were
Speaker 5: kind of nine months into the two thousand and seven
Speaker 5: two thousand and eight recession. So we have seen job
Speaker 5: growth kind of stay low but positive, but we have
Speaker 5: not seen hiring pick up, which means that if you
Speaker 5: have a job, you might be safe in your job,
Speaker 5: but if you're looking for a job, it is a struggle.
Speaker 5: And that, for me, is what I am waiting for
Speaker 5: to say that the labor market is truly out of
Speaker 5: danger when employers start to hire again, start to hire
Speaker 5: in good numbers. It's been falling for almost two years.
Speaker 4: The Instant analysis on our blog this morning from end
Speaker 4: to Curran was this is a holy jobs Batman moment.
Speaker 4: What if you work in manufacturing though, or in the
Speaker 4: auto sector, what does this market feel like?
Speaker 6: Well?
Speaker 5: I mean, I think there is good note there's always
Speaker 5: good news for moving with the tailwind.
Speaker 7: Right.
Speaker 5: It's harder for manufacturing to do well when the rest
Speaker 5: of the economy is doing poorly. It's easier for manufacturing
Speaker 5: to do well when the rest of the economy is
Speaker 5: doing well. And so although I would have liked manufacturing
Speaker 5: numbers to be hired this morning, I think that they
Speaker 5: have a lot, you know, more room to grow in
Speaker 5: a positive direction if they're catching up with the labor
Speaker 5: market as opposed to define an overall trend.
Speaker 2: Well on the manufacturing point, that was something that is
Speaker 2: being pointed to today by the Trump campaign, which put
Speaker 2: out a statement, Kamala Harris and Joe Biden have built
Speaker 2: back broke. This is a quote I'm reading here. Losing
Speaker 2: thirty four thousand manufacturing jobs in this just the past
Speaker 2: two months as foreign countries benefit from Harris's weak economic
Speaker 2: Paul and Harris's open border policies have destroyed eight hundred
Speaker 2: and twenty five thousand jobs for Native born Americans while
Speaker 2: one point two million foreign born workers gained employment. Catherine,
Speaker 2: I don't know if you have a reaction to that
Speaker 2: specific statement, but immigration is a factor here, right.
Speaker 3: Yeah, Well, let's peace through what could be factually correct there.
Speaker 1: Vice.
Speaker 5: Presidents don't have economic policies or much economic power to
Speaker 5: speak of, so I don't particularly.
Speaker 3: Like that characterization.
Speaker 5: Presidents have even muted powers on their own. But that's,
Speaker 5: you know, an election year that we don't think that.
Speaker 5: We do not count the number of jobs by the
Speaker 5: nativity of the person holding it. When we count the
Speaker 5: number of jobs, we count the employer's industrial sector.
Speaker 3: That is how we count jobs.
Speaker 5: It comes off of the survey of employers. When we
Speaker 5: count people through the household survey, we can look at
Speaker 5: the composition of nativity. What that number, which I've seen
Speaker 5: making the rounds on so many different platforms, is saying that,
Speaker 5: you know, basically, the number of non native workers in
Speaker 5: our economy is growing relative to the number of native
Speaker 5: workers declining. But they're looking at the sixteen and older population.
Speaker 5: So what all they've told you is that lots of
Speaker 5: people are retiring and that the age composition of the
Speaker 5: US workforce is changing. You in hand with the immigration
Speaker 5: composition of the US workforce. And I don't think that
Speaker 5: they're using that statistic accidentally. And that's what makes me
Speaker 5: quite upset about it is I think that they know
Speaker 5: what they're doing, and they know what they're counting, and
Speaker 5: they know what's driving it, and they're just trying to
Speaker 5: get people out there to hate immigrants. And I don't
Speaker 5: think that you can have one in five American workers
Speaker 5: we're not born here and somehow divide the labor market
Speaker 5: of the good ones and the bad ones of the
Speaker 5: people who were born here.
Speaker 3: And who weren't.
Speaker 4: What happens to the job market if we close.
Speaker 5: The border, Well, in general workers are good and fewer
Speaker 5: workers are bad. I think that's a good policy to
Speaker 5: think of. In turn, the labor market, the economy is growing,
Speaker 5: which means the need for the American for a workforce
Speaker 5: is growing. And if we have not produced enough Americans
Speaker 5: or have high enough labor force partis patient among Americans,
Speaker 5: then we always as a country have looked to immigration
Speaker 5: to fill that hole. Immigrants work at higher participation rates
Speaker 5: than native born Americans. They have very good earnings trajectories,
Speaker 5: and they've always been a part of our economy to
Speaker 5: turn away from what has typically made us very strong
Speaker 5: and resilient in the past, is I mean, it's not
Speaker 5: just a bad choice, it's obviously a hateful choice because
Speaker 5: it's not driven by what's good for the economy, but
Speaker 5: what makes people upset.
Speaker 2: Catherine. We just have about a minute left here. But obviously,
Speaker 2: as we consider the rhetoric in this campaign, it brings
Speaker 2: to mind election days. Two days out from the next
Speaker 2: FED decision, we might not know who wins by the
Speaker 2: time the Fed has to make a call. If you
Speaker 2: had to make the call to day with this data
Speaker 2: in hand, knowing the uncertainty that could be there, do
Speaker 2: you think they go twenty five fifty?
Speaker 3: Not at all.
Speaker 5: I think that I would expect Powell to do what
Speaker 5: he has done so far, which is to stay the course.
Speaker 5: They telegraphed how much rate reduction they expected over the
Speaker 5: course of the year, and to change course dramatically on
Speaker 5: the heels of an election would be so much more
Speaker 5: political than I would consider him to be capable of.
Speaker 5: They made a plan that was priced into the labor market,
Speaker 5: priced into business decisions, and to suddenly change course halfway
Speaker 5: through and say, actually, we're not going to drop a
Speaker 5: point in a half. We're going to stop right now
Speaker 5: because we're scared. I think that they don't like surprising people,
Speaker 5: and it's not a good time to surprise people.
Speaker 2: All right, Catherine Edwards, Bloomberg opinion contributor and economists, thank
Speaker 2: you so much for being here with us on this
Speaker 2: job's day. As we consider how this does have political implications,
Speaker 2: it's worth noting that this stronger print comes at a
Speaker 2: time where polling is suggesting Kamala Harris is doing better
Speaker 2: on the economy. In fact, a new American University poll
Speaker 2: that pulled women specifically has just come out that finds
Speaker 2: forty six percent trust Harris on the economy relative to
Speaker 2: thirty eight percent for Trump. To address inflation, the numbers
Speaker 2: are fifty one percent for Harris thirty seven percent for Trump.
Speaker 2: So for more on how this factors into the political
Speaker 2: scheme here and what kind of policies each of these
Speaker 2: candidates could pursue, we bring in Kevin Brie, former US
Speaker 2: Congressman for Texas and now spokesman for the Alliance for
Speaker 2: Competitive Taxation. He of course used to share the House
Speaker 2: wass and Means Committee as well. Congressman welcome back to
Speaker 2: Bloomberg TV and Radio. It's good to have you. We
Speaker 2: do want to get into tax policy, but if we
Speaker 2: could just consider the economic landscape we find ourselves in
Speaker 2: now and how this is playing in this cycle. Is
Speaker 2: the economy no longer a winning argument for Donald Trump
Speaker 2: and Republicans who are trying to use that as some
Speaker 2: of their greatest leverage against Democrats.
Speaker 8: Yeah, it is still, Kaylie. Good to see in Joe
Speaker 8: you as well, So yeah, it is still a very
Speaker 8: strong argument for President Trump and Republicans as a whole. Look,
Speaker 8: you know, the forty year high in inflation has not
Speaker 8: gone away. People are reminded of this almost daily. I
Speaker 8: think it's difficult for the vice president to take credit
Speaker 8: for a very good jobs report this month but then
Speaker 8: not take blame for the inflation, crime, the border crisis,
Speaker 8: everything else. That is a very unpopular administration, so politically
Speaker 8: it's hard to do those gymnastics. I think many Americans
Speaker 8: are eager to see that Trump economy return, mainly because
Speaker 8: they saw wages in the first three years after tax
Speaker 8: reform grow faster in those three years than and then
Speaker 8: since we began recording that data, new job opportunities very
Speaker 8: low poverty, income, inequality beginning to shrink. So I still
Speaker 8: think the President has a strong lead there, but he's
Speaker 8: got to make the case of what he'll do going forward.
Speaker 4: Sounds to me, Congressman, that while the markets may be
Speaker 4: celebrating all of this, nobody's talking about the R word
Speaker 4: after this report today, that you might still be worried
Speaker 4: about a hard landing and whether we see a recession
Speaker 4: next year. Where's your head on that.
Speaker 8: Yeah, So you know, when you get a report like this,
Speaker 8: you know you were encouraged that perhaps the FED can
Speaker 8: manage a soft landing, which I thought seemed very difficult
Speaker 8: to do a year ago or more. I thought it
Speaker 8: was almost inevitable. I still think with inflation, you know,
Speaker 8: still it's lower, but it is still very real. And
Speaker 8: I've noticed that in the last two economic stretches where
Speaker 8: we had very high inflation, it took the US six
Speaker 8: and eight years, respectively to really work themselves out of it,
Speaker 8: in part because you know, the FED needed to make
Speaker 8: really those consistent decisions to pour water on that inflation fire.
Speaker 8: So this is one of those things you just can't
Speaker 8: take for granted. It will go down, and look, I
Speaker 8: look at the numbers on this port strike and what
Speaker 8: the unions are getting ten percent pay raises per year,
Speaker 8: plus perhaps blocking productivity and innovation that helps lower costs.
Speaker 8: I worry about these agreements either costing jobs or being
Speaker 8: a factor for future inflation.
Speaker 2: Well, so all of that is going to weigh on
Speaker 2: the minds of monetary policy makers, I'm sure, Congressman. There's
Speaker 2: also the question of what fiscal policy is going to
Speaker 2: look like in tax policy is a component we want
Speaker 2: to talk to you about here. As I mentioned the
Speaker 2: polling and how Harris is doing on the economy. In
Speaker 2: our most recent swing state pole with Morning Consult, it
Speaker 2: found that across the battleground she had an eleven point
Speaker 2: advantage on who likely voters trust to help the middle class. She,
Speaker 2: of course, has argued that what she wants to do
Speaker 2: with tax policy would create more tax briefs for the
Speaker 2: middle class and charge the wealthy and big business their
Speaker 2: fair share. How do you, now, sir, given your role
Speaker 2: with the Alliance for Competitive Taxation, make the case that
Speaker 2: what Trump is proposing would indeed be good for the
Speaker 2: middle class.
Speaker 8: Yeah, so I will tell you this. I think President
Speaker 8: Trump focused on extending the tax cuts and Jobs Act
Speaker 8: that was proven to be remarkably strong in paycheck growth,
Speaker 8: in job growth, certainly in growth the US economy and
Speaker 8: our competitiveness overseas. You know, if Vice Harris raised the
Speaker 8: corporate to twenty eight percent, we will fall to second
Speaker 8: worst among our foreign competitors, certainly at a huge disadvantage
Speaker 8: to China, and more importantly back home here. You know,
Speaker 8: a new report by the Lanes for Competitive Taxation shows
Speaker 8: that if she's able to raise the corporate rate back
Speaker 8: up to twenty eight percent, the Americans on average will
Speaker 8: lose over six hundred dollars in wages. In some of
Speaker 8: the swing steat swing states like Ohio and Pennsylvania, you
Speaker 8: will see lost wages total between two and a half
Speaker 8: and three trillion dollars billion dollars, major increases for working families.
Speaker 8: So I still think President Trump has a stronger economic plan,
Speaker 8: and he's got to make sure he's clear about is
Speaker 8: he using terrorists for leverage to gain fair trade practices
Speaker 8: or is he going to go across the board, which
Speaker 8: I'm growing each day a little more skeptical about.
Speaker 4: Congressman, how nuanced is this debate going to be? You know,
Speaker 4: a couple of months ago, we were talking about simply
Speaker 4: extending what everyone has come to call the Trump era
Speaker 4: tax cuts. But since then, any number of exceptions have
Speaker 4: been put forth by the former president. No taxes on tips,
Speaker 4: no taxes on overtime, no taxes on Social Security. He
Speaker 4: even wants to restore salt. And I wonder, having been
Speaker 4: actually in charge of the Ways and Means Committee when
Speaker 4: all of this stuff took place, Congressman, if that changes
Speaker 4: the debate now that you're making all of these exceptions,
Speaker 4: what does that mean for the final product? Does salt
Speaker 4: need to be paid for? Does tips and overtime need
Speaker 4: to be paid for?
Speaker 7: Yeah? I will tell you.
Speaker 8: I think both campaigns are writing checks that I'm not
Speaker 8: sure Congress can cash. Whether it's new spending on or
Speaker 8: Vice President hair or child tax credit for housing, for
Speaker 8: extending the very generous Affordable Care Act premium subsidies or assault,
Speaker 8: or as you mentioned with President Trump, with tips, over time,
Speaker 8: social Security and salt. These are huge ticket items on
Speaker 8: top of simply extending the current very pro growth tax code,
Speaker 8: that too is about a four trillion dollar cost as well.
Speaker 8: So Congress is not going to have the space, fiscal
Speaker 8: space or political space to do all of that, and
Speaker 8: so I think it makes the policy debate, you know,
Speaker 8: even more intense in Congress next year. I still think
Speaker 8: at the end of the day, in a divided government,
Speaker 8: both parties are going to have to find a way
Speaker 8: for it. I think it starts with the middle class
Speaker 8: tax cuts in a big way, the small business tax cuts,
Speaker 8: and items like the child tax credit or both support
Speaker 8: at least keeping the current level. But at the end
Speaker 8: of the day, both parties are going to have to
Speaker 8: find their way through the promises and huge expenses to
Speaker 8: get this sort of back into the right place.
Speaker 4: He knows about this Share of the Ways and Means
Speaker 4: Committee in the House. Former Congressman Kevin Brady. Great to
Speaker 4: see you, sir, Houston. Looking nice today with the climate
Speaker 4: of Calcutta, not a cloud in the sky. Come see
Speaker 4: us when you're back here in the nation's capital. We'd
Speaker 4: love to see you, Congressman and Kayley. That really gets
Speaker 4: to the heart of what we're talking about here when
Speaker 4: it comes to debt and deficits.
Speaker 2: Absolutely, and we'll continue those conversations right here on Bloomberg
Speaker 2: TV and radio.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Can
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Speaker 4: Thirty Welcome, indeed to the Friday edition of Balance of Power.
Speaker 4: You made it to the threshold of the weekend, and
Speaker 4: we're glad to have you here on Bloomberg Radio, on
Speaker 4: the satellite, and on YouTube, where you can always find
Speaker 4: us by searching Bloomberg Business News Live. Simple as that
Speaker 4: you'll find our live feed there with yes, a lot
Speaker 4: of talk about jobs today, a White House that seems
Speaker 4: to be very pleased with the last twenty four hours
Speaker 4: in the news cycle, and by extension, a Harris campaign.
Speaker 4: As we just heard from Charlie, non farm payrolls up
Speaker 4: two hundred and fifty four thousand. The estimate was one
Speaker 4: hundred and fifty k, unless, of course, you follow Anna
Speaker 4: Wong on the terminal, you know this was an ipoper yesterday.
Speaker 4: Anna Wong, of course, Bloomberg Economics chief US economist out
Speaker 4: yesterday with a number at two hundred and seventy k.
Speaker 4: The preliminary estimate for a September jobs gain with the
Speaker 4: headline again this was yesterday. Why September payrolls may print
Speaker 4: surprisingly high. She's sitting here right now on this job's day.
Speaker 4: Good to see you, Anna, Thanks for coming in. So
Speaker 4: how come you knew something nobody else did?
Speaker 9: Well?
Speaker 10: You know, I think the NFP report is very it's
Speaker 10: very tricky to interpret because pays non farm pay payrolls,
Speaker 10: because it's driven a lot by statistical.
Speaker 3: Things.
Speaker 10: For example, it's driven by whether you can forecast the
Speaker 10: birth and death factor that BILS uses, whether you can
Speaker 10: count how much multiple jobs holders are there, how many
Speaker 10: part time jobs holder are there. So our forecast was
Speaker 10: driven by the observation that these statistical errors and would
Speaker 10: be boosting the month headline numbers, although I personally think
Speaker 10: that the truth is a much lower number. Really help
Speaker 10: come because that's not the reality you see on the ground.
Speaker 10: And also, as I said, we forecast the statistical error right,
Speaker 10: and the statistical error in these reports are huge. We
Speaker 10: estimate that we should be mentally adjusting down these non
Speaker 10: farm PAYIL numbers by about ninety thousand, So that would
Speaker 10: mean that in fact, job growth for is really hanging
Speaker 10: around more like below one hundred and fifty thousand.
Speaker 4: Does that mean we're in for some revisions again.
Speaker 10: For some So I think the revisions would come very late,
Speaker 10: so in twenty twenty six. Actually, yes, we do expect
Speaker 10: that the downward revisions for this year would be for
Speaker 10: the entire year. This year would be about one million
Speaker 10: by the time it's over. So yeah, we just need
Speaker 10: to mentally adjust down the monthly number.
Speaker 4: Well, but again, you know, the Labor Department has a
Speaker 4: couple of smart people around there, right, They put their
Speaker 4: green visors on and they come up with this number
Speaker 4: every month. How come Bloomberg Economics can see so much
Speaker 4: further beyond what the Labor Department is seeing right now?
Speaker 10: Well, Joe, I think a lot of traders on Wall
Speaker 10: Street can also see this. I mean, I think the
Speaker 10: idea is that it's important to forecast anomalies and statistical properties.
Speaker 10: And I mean our job is to forecast what's printed,
Speaker 10: not what's the reality.
Speaker 4: Yeah, okay, yeah, so the market's smarter than labor. Is
Speaker 4: it a matter of updating our models here? Can the
Speaker 4: government do a better job?
Speaker 10: Well, I think the people working at BLS are very
Speaker 10: smart and very conscientious. They're just following statistical procedure which
Speaker 10: they have been using for decades, right, And these statistical
Speaker 10: procedure tends to create a lag in real time when
Speaker 10: you have a turning point in that business cycle. I
Speaker 10: still think that currently the labor market overall is pretty
Speaker 10: soft and overall is cooling, and you know, once you
Speaker 10: adjust for those legging factors, that's that's the trend that
Speaker 10: we should be observing.
Speaker 4: You're talking this morning about a rising unemployment rate as well,
Speaker 4: at least by the end of next year, five percent,
Speaker 4: that's in the cards for this economy, right, What would
Speaker 4: that tell us about the state of the job market
Speaker 4: at that point? Are we still talking about a soft landing?
Speaker 8: Yeah?
Speaker 10: So I think five percent would be a gray area
Speaker 10: where economists would tend to argue that maybe it's not
Speaker 10: a recession because the Saw rule would suggest that after
Speaker 10: the unemployment rate breach the point five percentage point increase
Speaker 10: over a twelve month period, it should rise for another
Speaker 10: or two percent, and that would be more consistent with
Speaker 10: five point five percent unemployment rate. But I think at
Speaker 10: five percent, most Americans would feel terrible about.
Speaker 4: This job market. We get one more job support before
Speaker 4: the election, don't we?
Speaker 10: Yes, this is going to be and that one I
Speaker 10: think would be weak. Really, yes, that one of the
Speaker 10: election on the eve of it, on Friday, right before election,
Speaker 10: but there's a question of whether the voters would have
Speaker 10: a lot of voters would have voted by that. It's
Speaker 10: really this pairal report that would influence a lot of.
Speaker 4: Is the one that tells Yes, you'll hear people talking
Speaker 4: about how it was politically motivated. I'm sure at the
Speaker 4: LS at.
Speaker 1: Some point here.
Speaker 4: But that's why we talked to Anna Wong, because she
Speaker 4: knows more than just about anybody here in the Capitol. Anna,
Speaker 4: great to see you, Thank you, congrats on the number.
Speaker 4: She might not have won the prices right, but she
Speaker 4: would have come a lot closer than most people. Two
Speaker 4: seventy Anna Wong, Bloomberg Economics Chief US Economist. It's one
Speaker 4: of the top stories that we're following today, coinciding, of course,
Speaker 4: with the end of this doc workers strike. I shouldn't
Speaker 4: say the the suspension of the dock workers strike. That
Speaker 4: was forty five thousand workers, and there was a lot
Speaker 4: of concern about how that would show up in the
Speaker 4: October payroll numbers. Maybe have skirted that one as well,
Speaker 4: that they still have to work out the issue of
Speaker 4: automation now having handled the pay issue. One of the
Speaker 4: other stories, as I mentioned that, we've been following quite
Speaker 4: a lot here at Bloomberg, and not certainly on the
Speaker 4: political programs as much is the need the thirst for power.
Speaker 4: You know, Microsoft turn a lot of heads last month
Speaker 4: when it announced this deal with Constellation Energy. Remember this,
Speaker 4: we talked about it to restart part of the three
Speaker 4: Mile Island nuclear power plant in Pennsylvania to power its
Speaker 4: data centers. That's the whole game right now. If we're
Speaker 4: going to have generative AI, you need a lot of
Speaker 4: data centers and they need a lot of power, and
Speaker 4: the grid at the moment doesn't have all the power
Speaker 4: that is needed. And there's more where this came from.
Speaker 4: Oracle is designing a data center that would be powered
Speaker 4: by three small all modular nuclear reactors. We heard about
Speaker 4: that from Larry Ellison in the earnings call just two
Speaker 4: weeks ago. And Google is now working on large scale
Speaker 4: data centers. They say we'll suck up more than one
Speaker 4: gigawatt of power, and so again they use these small
Speaker 4: modular nuclear reactors remember this, they're called SMRs to provide
Speaker 4: the juice. How quickly though these companies can get these
Speaker 4: new sources up and running as a question, regulations are
Speaker 4: a question, and we wanted to talk with an expert.
Speaker 4: Glad to say. We're joined by Catherine Hamilton, chair at
Speaker 4: thirty eight North Solutions, which is a clean energy and
Speaker 4: technology consulting firm. She is an expert on the grid
Speaker 4: and his host of the Energy Gang podcast. Catherine, I've
Speaker 4: been looking forward to talking with you because this story
Speaker 4: just seems to get louder every day. Is just broadly
Speaker 4: to start off, is nuclear the answer?
Speaker 11: Oh?
Speaker 12: I wish I could tell you there was only one
Speaker 12: answer to this issue, but no, Luckily we have a
Speaker 12: lot of different solutions. The grid is a complex beast
Speaker 12: that needs a lot of updates. And yet yes we
Speaker 12: can use nuclear, but it's not the only solution. Luckily,
Speaker 12: we have a lot of other things that can bring
Speaker 12: to the four to deploy. And I will tell you
Speaker 12: this also, in addition to AI, we have increased manufacturing,
Speaker 12: we have increased electrification. So demand is growing and load
Speaker 12: is growing everywhere. And I want to tell you this
Speaker 12: is not the first time this has ever happened. You
Speaker 12: probably before your time in the nineteen seventies, we got
Speaker 12: air conditioning and the utilities had to build new power plants.
Speaker 12: In the eighties, when I started working at a utility,
Speaker 12: we had increased demand and we had to be really
Speaker 12: innovative with ice storage, with new ways of thinking about
Speaker 12: rate structures, the time of use, with demand response, and
Speaker 12: we were able to get that done. But for the
Speaker 12: last couple of decades, demand has not grown and so
Speaker 12: now we're in a position where the utility muscle for
Speaker 12: innovation it's gone a little slack. But luckily we have
Speaker 12: innovation that's been greatly democratized, and we can talk about
Speaker 12: what all those innovations are on the grid because I
Speaker 12: think we do have the tools to be able to
Speaker 12: handle this well.
Speaker 4: It's kind of the point where we're talking about high
Speaker 4: tech companies wanting to build data centers on the site
Speaker 4: of a nuclear power plant because it checks a couple
Speaker 4: of boxes. It's not just this uninterrupted supply. It's also clean,
Speaker 4: so to speak. And many of these companies have made
Speaker 4: climate pledges and it allows them to fulfill all of
Speaker 4: these goals. What else do you see?
Speaker 6: Yeah?
Speaker 12: Absolutely, Plus, if you build where there was an old manufacturer,
Speaker 12: another nuclear plant, that that was originally there. You also
Speaker 12: have all the interconnection, so that's a huge issue too,
Speaker 12: is making sure you can actually connect to the power plant.
Speaker 12: So let's take a look at a few other technologies,
Speaker 12: so geothermal, geothermal, next generation technologies. There are hundreds of
Speaker 12: gigawatts of ability to install geothermal and with these new
Speaker 12: technologies closed loop that can produce both heat and power.
Speaker 12: We have other kinds technologies that can go anywhere, so
Speaker 12: you don't have to find a resource anymore. You can
Speaker 12: really install geothermal anywhere. So let's look at geothermal. Let's
Speaker 12: look at hydropower. Right now, only three percent of our
Speaker 12: dams are producing electricity. That doesn't mean we need ninety
Speaker 12: seven percent of the dams to be producing, but we can.
Speaker 12: We can build another fifty gigawatts of plants with facilities
Speaker 12: that are already installed. And then there are all these
Speaker 12: new transmission technologies, grid enhancing technologies, there are advanced conductoring technologies.
Speaker 12: And then what we don't want to forget is the
Speaker 12: demand side. So a lot of people think you build
Speaker 12: a power plant, you take it the electrons through the line,
Speaker 12: and you serve a load. And this is just a load.
Speaker 12: You know what customers are no longer just load and
Speaker 12: AI centers are the same. AI centers can also serve
Speaker 12: as a resource so distributed energy resources so behind the
Speaker 12: meter assets, whether it's solar or storage microgrids, can all
Speaker 12: be helpful in feeding the grid as well. So we
Speaker 12: have to look at solutions all the way from the supply
Speaker 12: side to the demand side, and AI centers are starting
Speaker 12: to do that too. A lot of companies that are
Speaker 12: developing AI centers are looking at how do we build
Speaker 12: plants that can take one hundred percent renewable energy, that
Speaker 12: can do liquid cooling, heat recovery, batch some of these
Speaker 12: operations so that we can really get not only get
Speaker 12: every electron we can off of the grid, but also
Speaker 12: provide resources back.
Speaker 4: To the grid on the meter. There'll be another great
Speaker 4: name for a grid podcast. These things just hit me
Speaker 4: as you say them. You've talked about hydro producer Matt
Speaker 4: is asking why don't we just put all of these
Speaker 4: data centers along the Mississippi River. We'll have an AI
Speaker 4: corridor that runs right through the middle of the country.
Speaker 4: I see it. You seem to like that idea.
Speaker 12: That's a great idea. You'll also find a lot of
Speaker 12: new manufacturing plants for energy storage technologies and other new
Speaker 12: manufacturing that the Inflation Reduction Act and the Infrastructure Bill
Speaker 12: kind of promoted. Those are all going up and down
Speaker 12: the Ohio and other rivers. And yes, we have resources
Speaker 12: right there, old Army Corps facilities that can be repowered
Speaker 12: and reuse and made fish friendly to ensure that we
Speaker 12: get the electrons we need to those facilities.
Speaker 4: Yeah, all right, Matt, you hear that your million dollar
Speaker 4: idea has been approved. So I guess you know, when
Speaker 4: we step back from this, there's everybody's talking about nuclear
Speaker 4: and Catherine, you keep telling me that this is all
Speaker 4: of the above. Is that the conversation we're supposed to be.
Speaker 12: Having, we are supposed to be having that, and the
Speaker 12: key is we need some policy support on that. So,
Speaker 12: for example, for geothermal, we have had zero demonstration dollars
Speaker 12: put towards geothermal. It's been a bit of a step
Speaker 12: child in all of the funding that came out of
Speaker 12: the last the Infrastructure Bill. For example, hydropower didn't get
Speaker 12: much love in the Inflation Reduction Act either, and on
Speaker 12: the demand transmission, the Transmission Investment Tax Credit fell out
Speaker 12: of the Inflation Reduction Act. So there's some things we
Speaker 12: still need in policy, and we need state regulators to
Speaker 12: also say, all right, let's figure out how we can
Speaker 12: get the demand side to be part of the equation.
Speaker 12: So we don't just model and plan our utilities based
Speaker 12: on I'm going to build a big power plant. I'm
Speaker 12: going to mortgage it and have the consumers pay for
Speaker 12: it instead, like, let's have the consumers participate so their
Speaker 12: costs don't go up too well.
Speaker 4: So, Catherine, what about the utilities? What about the next
Speaker 4: terras and the dominions? Because I see a story here.
Speaker 4: Texas's top electricity regulator has a message for big tech.
Speaker 4: If you want to build AI data centers next to
Speaker 4: power plants, you may also need to build the power
Speaker 4: plant too. What does the future grid or the future
Speaker 4: utility look like with that in mind?
Speaker 12: Yeah, it's super interesting because Texas is its own market
Speaker 12: as it is in a lot of ways. They have
Speaker 12: resource adequacy. There's this much more real time market than
Speaker 12: it is in a lot of other places and a
Speaker 12: lot of other planning processes. So yes, they look at
Speaker 12: resource adequacy. Do we have enough to meet the demand?
Speaker 12: And if we don't, let's figure out who's going to
Speaker 12: build it. A lot of other states, utilities are incentivized
Speaker 12: to build big things and then get cost allocation and
Speaker 12: a guaranteed rate of recovery for their customers. But I
Speaker 12: think some of the best models are, for example, cooperative
Speaker 12: utility in rural settings. And I will tell you I
Speaker 12: live in Virginia and our data center is being built everywhere,
Speaker 12: and I'm served by an electrical co op, and the
Speaker 12: co op says, all right, in order to serve all
Speaker 12: these data centers, we have to be creative, and we
Speaker 12: can because our number one issue is.
Speaker 13: Cost to our customers.
Speaker 12: We're a cooperative, we don't have to give a rate
Speaker 12: to return to a shareholder. So instead we're going to
Speaker 12: look at how do we aggregate all of these behind
Speaker 12: the meter, you know, energy storage facilities. How do we
Speaker 12: aggregate all this? How do we use this to help
Speaker 12: support our data centers so we don't have to put
Speaker 12: a lot of money into building something. You know, maybe
Speaker 12: we're going to end up building a natural gas plant,
Speaker 12: which would be maybe the worst option, right because it's
Speaker 12: producing more fossil fuels. So I think in more greenhouse gases,
Speaker 12: I think you will see a lot of changes in
Speaker 12: the way the utilities hopefully are incentivized. And the good
Speaker 12: news is corporates want this, they want zero carbon energy.
Speaker 4: See this is why you talk to an expert. I've
Speaker 4: been really looking forward to this conversation. Catherine Hamilton, thirty
Speaker 4: eight North Solutions. Keep this in mind next time you
Speaker 4: hear about the SMRs Catherine, thank you. I'm Joe Matthew.
Speaker 4: This is Bloomberg.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 2: Just across the river in northern Virginia, I was getting
Speaker 2: a lot of reports this week of lines at Costco
Speaker 2: doing this, no paper goods.
Speaker 4: Paper goods, water bottles being.
Speaker 2: Loaded up onto cars. I was getting photos of this.
Speaker 2: It's not members of my family. It's not just the toilet, paper,
Speaker 2: paper towels, water bottles. Apparently this was a concern because
Speaker 2: there was a strike that was affecting every port along
Speaker 2: the East Coast and the Gulf Coast as well. Tens
Speaker 2: of thousands of workers walking off the job with the
Speaker 2: potential to snarl supply chains, got a lot of people
Speaker 2: freaked out given the experience everyone had just a few
Speaker 2: years ago during the height of the pandemic. None to
Speaker 2: worry though, at least until January fifteenth, because there is
Speaker 2: a wage agreement.
Speaker 4: Joe, there's going back worry about to begin with ninety
Speaker 4: percent of the toilet papers made here. I heard that
Speaker 4: from Tyler Kendall. Okay, still still sorry, I had to digress.
Speaker 2: The longshoremen have reached an agreement with the Maritime Alliance
Speaker 2: for a sixty one and a half percent raise over
Speaker 2: the course of the next six years, less than they
Speaker 2: were looking for originally, but of course also above the
Speaker 2: offer that the Alliance had made right before the workers
Speaker 2: went on straight.
Speaker 4: Yeah, that's a monster payhike for the highest rate, certainly,
Speaker 4: But the question about automation remains right, workers want to
Speaker 4: have language. They guarantees no automation. You might have heard
Speaker 4: Kevin Ready refer to that actually banning innovation, I think
Speaker 4: is how he put it. So this remains controversial. It's
Speaker 4: going to be maybe even a tougher component to hammer
Speaker 4: out here, but it's smooth sailing until November fifth, and
Speaker 4: that's the point in this conversation, isn't it.
Speaker 2: Yeah, by the time this is once again a concern
Speaker 2: in midja January will be just a few days out
Speaker 2: from the next president imagine being inaugurated. The question is
Speaker 2: how does this potentially impact or not who that next president.
Speaker 14: Is likely to be.
Speaker 4: See what the panel thinks. They're back with us for
Speaker 4: the Friday edition. Rick Davis and Jeanie Shanzy no Bloomberg
Speaker 4: Politics contributors. She is, of course political science professor Iona University.
Speaker 4: Rick Davis partner at Stone Court Capital. Thanks to both
Speaker 4: of you for being here. Genie, I'll start with you
Speaker 4: as our Democrat. This is being framed as a big
Speaker 4: win for Kamala Harris, the benefits of incumbency no strike,
Speaker 4: at least for now. But we've got a lot of
Speaker 4: things going on here as well, including rising oil prices
Speaker 4: based on what's happening in the Middle East. Would it
Speaker 4: be smart for Kamala Harris to celebrate this today?
Speaker 15: First of all, you guys are making me very nervous.
Speaker 15: I feel like I too must run the costco. And
Speaker 15: then you reminded me the strike is over, so I
Speaker 15: really can't go back to that, you know, coupled with
Speaker 15: the jobs report, what happened with the strike is very
Speaker 15: very good news for the Kamala Harris's campaign and of
Speaker 15: course for the US economy.
Speaker 6: More importantly, you.
Speaker 15: Know that said I would not go out and celebrate
Speaker 15: that as we look at the voters that she needs
Speaker 15: to appeal to.
Speaker 6: The undecided voters.
Speaker 15: These are people who are deeply concerned about being able
Speaker 15: to put food on their table, gas in their cars.
Speaker 6: These are people concerned about inflation.
Speaker 15: So as much as there is good news, I think
Speaker 15: the message from Harris has got to be we continue
Speaker 15: to understand and feel the pain you have felt for
Speaker 15: a long time. Now things are getting better and by
Speaker 15: the way, the poll numbers suggest that, and we are
Speaker 15: still working hard on your behalf.
Speaker 6: So no celebrations quite yet. She's got to wait for
Speaker 6: something like that.
Speaker 2: Well, especially Rick, when you consider one of the things
Speaker 2: Genie just mentioned that people are worried about being able
Speaker 2: to fill their car with gas. Pump prices potentially could
Speaker 2: be on their way higher if oil futures are to
Speaker 2: be believed, which of course have spiked this week given
Speaker 2: the ongoing conflict in the Middle East. Is that actually
Speaker 2: the worst headache of them all for Kamala Harris and
Speaker 2: the administration that she's affiliated with.
Speaker 16: Yeah, it just depends upon how much. I mean, there
Speaker 16: have been moderate increases and decreases all year long. This
Speaker 16: has not really been a year where the economy has
Speaker 16: been framed on gas prices. Frankly, I think families are
Speaker 16: more concerned about what are egg costs than a gallon
Speaker 16: of gas. But the reality is that any bad news
Speaker 16: in the economy is a notch against this current administration
Speaker 16: and obviously that flows down to Kamala Harris. So what
Speaker 16: she wants is more news like today, you know, great
Speaker 16: jobs report, low unemployment. You know, she wants to see
Speaker 16: those interest rates coming down. I mean that the macro
Speaker 16: economic drivers that families will experience between now and election
Speaker 16: day will be influential at the end of the day
Speaker 16: with how they vote. But the mood is still pretty sour,
Speaker 16: so they see it take up in a couple of
Speaker 16: cents on their gas price and they might like start
Speaker 16: thinking about what it was like a couple of years ago,
Speaker 16: and that would be bad news for the Kamala Harris campaign.
Speaker 4: Well, I wonder what we think is good news here? Rick, Yes,
Speaker 4: the jobs report. I get that, but in terms of
Speaker 4: the dock workers strike, the administration's fingerprints are all over this.
Speaker 4: The Chief of Staff, Jeff Science, was on the phone
Speaker 4: yesterday morning at five point thirty in the morning with
Speaker 4: the shippers. Julie Sue, the acting Labor Secretary, actually went
Speaker 4: up to New Jersey to try to close the deal.
Speaker 4: Does that rub off on Kamala Harris in this situation
Speaker 4: or did we simply dodge a bullet that most of
Speaker 4: the country didn't even know about.
Speaker 16: Yeah, I don't see how this administration thinks being the
Speaker 16: most pro union presidency is somehow anuring benefit to them,
Speaker 16: especially with white working class voters outside the cities. I mean,
Speaker 16: those folks are going for Trump, and so the more
Speaker 16: they talk about this, you know, we've just gotten them
Speaker 16: a huge increase and.
Speaker 11: You know, their pay.
Speaker 16: Most of these places are not where they are located
Speaker 16: or not competitive their East coast West coast sites where
Speaker 16: a lot of these dock workers are are doing in
Speaker 16: their trade, and so they're not going to affect themselves
Speaker 16: the election. But the message is kind of in reverse
Speaker 16: to Republicans, Hey, we're doing this for union members and
Speaker 16: you're on your own. You know, we didn't do a
Speaker 16: thing for you to try and increase your pay, and
Speaker 16: so I think it has a chance of backfiring on them.
Speaker 16: I don't think it's helped them to date. The more
Speaker 16: they talk about union jobs, the less they're talking about,
Speaker 16: you know, Middle America and what they're doing. And I
Speaker 16: think it's counterintuitive to think that that is somehow helping
Speaker 16: them amongst working class voters.
Speaker 2: Well, I've certainly seen a lot of as Rick raised
Speaker 2: the price of eggs earlier advertisements here in the DC
Speaker 2: area about prices being higher. In the voice that is
Speaker 2: vocalizing a lot of that is the Democratic candidate for
Speaker 2: Senate in Maryland, Angela Alsobrooks. We, of course in this
Speaker 2: area have been inundated by commercials from Larry Hogan, her opponent,
Speaker 2: and from Ulster Brooks herself.
Speaker 3: We got.
Speaker 2: It's constant, and I don't think that will change in
Speaker 2: the next step four and a half weeks. But Genie,
Speaker 2: we did get news in the also break also Brooks
Speaker 2: race today former President Barack Obama endorsing her. I don't
Speaker 2: think this is a surprise to anyone, but he noted
Speaker 2: in the ad control of the Senate could come down
Speaker 2: to Maryland, So vote for Angela also Brooks as we
Speaker 2: consider the control of the Senate and how that race
Speaker 2: could be influential, as are the others that we're watching.
Speaker 2: How are you feeling now, given everything we just talked
Speaker 2: about about the trajectory of the economy, things that we
Speaker 2: may be working a bit more in favor of a
Speaker 2: Democratic administration. What does that mean for other Democratic incumbents
Speaker 2: down the ballot.
Speaker 15: Yeah, and of course we feel the pain when we
Speaker 15: are inundated with the commercials of all the people in
Speaker 15: the swing states who have been feeling, you know, inundated
Speaker 15: with campaign ads after campaign ads. You know, I think
Speaker 15: Barack Obama's endorsement of Alsal Brooks was not unexpected. They
Speaker 15: are hoping that it drums up enthusiasm for her and
Speaker 15: get out the vote.
Speaker 6: She's in a tough race.
Speaker 15: Larry Hogan remains a particularly powerful voice in Maryland and
Speaker 15: a particularly tractive candidate. But of course Democrats are deeply
Speaker 15: concerned that they may lose Montana, and so also Brooks
Speaker 15: would be very important in that case. They are also
Speaker 15: spending big, as you've talked a lot about in Texas,
Speaker 15: to try to see if they can push that even
Speaker 15: further towards the Democrats. That still is an uphill battle,
Speaker 15: but the numbers look a little better there, and they're
Speaker 15: also spending in Florida, so they feel like they've got
Speaker 15: the money to do that. And you know, this is
Speaker 15: critically important because whoever takes the House, we're talking about
Speaker 15: the Senate, but the House in particular is really up
Speaker 15: for grabs this time. And if Donald Trump wins and
Speaker 15: he is facing a Democratic led House under Hakeem Jeffries,
Speaker 15: it is going to be very hard for him to
Speaker 15: do what he wants to do on everything from taxes
Speaker 15: to immigration and likewise Kamala Harris if Republicans retain it.
Speaker 15: So these down ballot races are critical, and of course
Speaker 15: for those in particular we've been watching New York and California.
Speaker 15: We don't get a lot of the ten usually in
Speaker 15: New York and California on the national stage because loose states.
Speaker 15: But in the case of the House, these races down
Speaker 15: ballot matter an awful lot this time around.
Speaker 4: I just wonder when the ads start to cancel each
Speaker 4: other out here. Rick, you live around the Capitol, and
Speaker 4: picking up on what Kaylee just mentioned, you know, you
Speaker 4: sit down with Missus Davis to watch The Wheel of
Speaker 4: Fortunate at night, you're going to see in every commercial
Speaker 4: break and add from also Brooks and then immediately following
Speaker 4: an opposition ad, an opo ad from Larry Hogan. It
Speaker 4: gets to the point where it's just noise for people
Speaker 4: who want to get back to their TV program? Is
Speaker 4: it a turnoff? Does it work?
Speaker 13: You know?
Speaker 16: I think it does impact. I'm a firm believer in
Speaker 16: broadcast advertising. Still, obviously that doesn't even account for all
Speaker 16: the digital advertising we're inundated with for those of us
Speaker 16: who get a lot of our news on the web.
Speaker 16: And so yeah, well, first of all, you don't want
Speaker 16: to go naked, right, So the only thing worse than
Speaker 16: that is if your opponent is running an enormous out
Speaker 16: of advertising and you're not up. So part of it
Speaker 16: is prescriptive in that regard, But the bottom line is
Speaker 16: voters do glean information from that. There's not that much
Speaker 16: reporting on these kinds of like senate and house races,
Speaker 16: as Genie mentioned, and so you got to get it
Speaker 16: sometimes from the advertising. And this is where creative advertising
Speaker 16: really matters. I mean, some of these ads are actually
Speaker 16: pretty good and you go, oh, Gee, that was interesting.
Speaker 16: I'd say the vast majority I've seen, at least in
Speaker 16: this area put me to sleep. So every now and
Speaker 16: then I get to go to New York and I
Speaker 16: get to see all these little load ads and stuff
Speaker 16: like that, and I think, oh, these are much better
Speaker 16: than when I get home.
Speaker 2: Well in New York, Genie, I do want to mention
Speaker 2: the reporting we got yesterday in regard to one Congressman
Speaker 2: who is in one of these areas that could make
Speaker 2: or break the majority. Mike Lawler, the incumbent Republican in
Speaker 2: photos from college in blackface when he was dressing up
Speaker 2: as Michael Jackson. Just given the competitive nature of New
Speaker 2: York and his district in particular, what does that do.
Speaker 7: You know?
Speaker 6: He was twenty years old.
Speaker 15: I am not sure that this is going to make
Speaker 15: a huge difference. It is of course negative press for
Speaker 15: Mike Lawler. We know him well up here in the
Speaker 15: Hudson Valley. He also, by the way, has expressed interest
Speaker 15: and potentially running for governor, and he's been in a
Speaker 15: very attractive candidate for Republicans. Mandre Jones likewise, who is
Speaker 15: opposing him. I am not sure how it will play.
Speaker 15: I don't think it's going to play big. He's not
Speaker 15: the only Republican in New York who's you know, facing
Speaker 15: ethics challenges. We've also got d Esposito and because we
Speaker 15: don't want to leave the Democrats aside, of course, Eric
Speaker 15: Adams in New York City, so you know, as usual
Speaker 15: in New York has to be the home of ethical,
Speaker 15: ethically challenged polls, and here we have it in this
Speaker 15: race almost up and down the ballot, unfortunately, and by partisan,
Speaker 15: I should add.
Speaker 2: That's a very fair point. Genie Shanzano and Rick Davis,
Speaker 2: our signature political panel, thank you so much for joining
Speaker 2: us here on the early edition a Balance of Power.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast ken
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Speaker 1: Say Alexa play Bloomberg eleven thirty.
Speaker 4: It's the Friday edition of Balance of Power. I'm Joe
Speaker 4: Matthew indeed, alongside Kaylee Lines here in the Nation's Capital
Speaker 4: with our eyes of course on Israel. There are so
Speaker 4: many questions about what might happen over this weekend as
Speaker 4: Israel calculates a potential and expected promised frankly, a response
Speaker 4: to Iran. But Kaylei, it's not just Iran we're talking about.
Speaker 4: Israel continues air strikes now in southern leven on the
Speaker 4: fact they are urging civilians in more than twenty towns
Speaker 4: and villages across the border to evacuate. We talked about
Speaker 4: cross border incursions limited groups of troops, but the air
Speaker 4: strikes are really what's been doing the damage.
Speaker 2: And we've gotten reporting from the New York Times and
Speaker 2: a number of other media outlets about the strike, specifically
Speaker 2: that we saw overnight targeting the potential successor of Hassan Estralla,
Speaker 2: of course, the assassinated leader of HESBLA, as well as
Speaker 2: other figures. At the same time, though, as we're still
Speaker 2: seeing this activity in southern Lebanon outside of Beirut, Aron's
Speaker 2: foreign minister visiting Beirut and saying we will back a ceasefire.
Speaker 3: The question is.
Speaker 2: Whether Israel is going to get on board with that
Speaker 2: after it resoundedly rejected the ceasefire proposal put forward by
Speaker 2: the US and other allies just last week.
Speaker 4: Yeah, and of course we talk about the idea of
Speaker 4: a ceasefire in Gaza. Wants to see these basically take
Speaker 4: place at once, and I cannot imagine that's something that
Speaker 4: Benjamin Etna who is looking for.
Speaker 2: Yeah, well, so that's what we want to get into now.
Speaker 2: As we turn to the voice of Michael O'Hanlon, he
Speaker 2: is Brookings Institution Senior Fellow and director of Research in
Speaker 2: the Foreign Policy Program. Welcome to Balance of Power. Michael.
Speaker 2: Great to have you here on Bloomberg TV and Radio.
Speaker 2: What is your expectation as to what happens next here?
Speaker 2: Knowing Joe Biden yesterday admitted that it is up for
Speaker 2: discussion that Israel hit Iran energy infrastructure. Now Iran seems
Speaker 2: to be the one signaling that they would like to
Speaker 2: see de escalation here. Is that de escalation likely to happen?
Speaker 14: Readings Not very likely, although you could imagine off ramps,
Speaker 14: but it probably would take a different personality than Benjamin
Speaker 14: Netan Yahoo, given where he is in his thinking and
Speaker 14: where this whole war is. As we near the one
Speaker 14: year anniversary of the terrible tragedy of last October seventh,
Speaker 14: it's pretty clear Israel will respond about as you just said,
Speaker 14: I think the most minimal kind of response you could
Speaker 14: envision would be a beefed up version of what Israel
Speaker 14: did back in April, when Iran launched three hundred plus
Speaker 14: missiles and drones at Israel.
Speaker 11: Again, like this time, almost all were intercepted, and.
Speaker 14: Israel sent back some limited strikes against air defense capabilities
Speaker 14: around the Iranian nuclear enrichment facility, partly as a message
Speaker 14: to Iran to say, you know, we could have hit
Speaker 14: the enrichment facilities if we had wanted to, and maybe
Speaker 14: we will next time. So I still think there's a
Speaker 14: chance that Israel will go after the underground facilities. It
Speaker 14: would require some of the same kind of successive bomb
Speaker 14: jackhammering that we saw kill Nasrala in Lebanon, because Israel
Speaker 14: doesn't have a weapon powerful enough to just get down
Speaker 14: to those facilities in one fell swoop. But there's a
Speaker 14: good chance that Israel could take out the Iranian air
Speaker 14: defense network and then go ahead and do that. It's
Speaker 14: a long flight for any of the aircraft involved, but
Speaker 14: I wouldn't rule that out. But it's more likely, as
Speaker 14: again you said a few minutes ago, that Israel will
Speaker 14: do something that's big but different than that, and probably
Speaker 14: targeting oil and energy and money the Iranian regime's ability
Speaker 14: to keep itself afloat, especially at a time when sanctions
Speaker 14: evasion has become more rampant and Iran's earning more money
Speaker 14: than we really wanted them to under the Joint Comprehensive
Speaker 14: Plan of Action. Of course, the US hasn't really even
Speaker 14: responded or returned to that framework, but it's still there
Speaker 14: with other countries. And Israel could say, listen, if sanctions
Speaker 14: won't work, how about bomb and we can do the
Speaker 14: same sort of thing. But then that invites a response
Speaker 14: by Iran to shut down the Strait of horror, moves
Speaker 14: to shipping in general, and or at least to complicate
Speaker 14: shipping through the Persian Gulf. And so I think Israel
Speaker 14: would actually be wise to look for an off ramp,
Speaker 14: but I don't think they will.
Speaker 4: Why then, Michael used brute force in the form of
Speaker 4: bunker busting, bombs or whatever would get the Israeli military
Speaker 4: down to that level underground where the nuclear facilities are.
Speaker 4: Why not use a cyber attack as we saw with
Speaker 4: stucks Net. That is something that Iran might not even
Speaker 4: acknowledge publicly.
Speaker 14: Well, if you could do it, sure, but as you'll recall,
Speaker 14: stucks Net was based partly on good luck. I think
Speaker 14: somebody left a thumb drive in a parking lot and
Speaker 14: that allowed us to or took a thumb drive maybe
Speaker 14: that we had deposited in a parking lot, and put
Speaker 14: it into a machine, and then sucks Net was unleashed,
Speaker 14: and then the whole world found out because it spread
Speaker 14: further than intended. Also only took down their centrifuges for
Speaker 14: a few months, and you could say, well, maybe that's
Speaker 14: good enough, except that Iran is now so close to
Speaker 14: a nuclear weapon that I think slowing them down for
Speaker 14: a few months in something they can probably recover from
Speaker 14: after that would not be seen as ample. And moreover,
Speaker 14: I doubt very much Israel has the access to those
Speaker 14: machines that we managed to buy, you know, trick and
Speaker 14: buy guy find our way to according to public reports,
Speaker 14: you know, a dozen years ago.
Speaker 11: So I don't think we have a stuck in that option.
Speaker 11: I don't think Israel does either.
Speaker 4: Well.
Speaker 2: Well, of course we've had Joe and I have had
Speaker 2: a lot of conversations in recent days as we've considered
Speaker 2: this question around Iran's nuclear facilities. Of whether that would
Speaker 2: mean they rush to actually make a weapon, not just
Speaker 2: develop the components of that. What the consequence could be
Speaker 2: that Iran does in response to that. There's also the question, Michael,
Speaker 2: and that's especially relevant to our audience here at Bloomberg,
Speaker 2: about the straight of horror moves and whether Iran could be,
Speaker 2: if attack severely enough, on the cusp of making a
Speaker 2: decision to choke off the export of energy from the golf.
Speaker 2: We've certainly seen oil prices with their biggest weekly spike
Speaker 2: since October of twenty twenty two this week, potentially out
Speaker 2: of concern for that. Do you think that is actually
Speaker 2: a warranted concern?
Speaker 14: Yes, I think it's certainly one that has double digit
Speaker 14: probabilities associated with it. Whether it's ten percent, twenty or fifty,
Speaker 14: I don't know, but I think there is a decided
Speaker 14: chance that Israel will attack Iran's oil economy, and that
Speaker 14: Iran will respond not by attacking Israel again, which it's
Speaker 14: proven itself relatively incapable of doing, at least with this
Speaker 14: missile approach, but instead by trying to hurt the whole
Speaker 14: world economy and hurt the United States and the process. Now,
Speaker 14: they might you know Benjaminyal, who probably would like to
Speaker 14: see Donald Trump elected. I'm not sure the Iranian leadership
Speaker 14: wants that, and so to throw the world economy into
Speaker 14: a tizzy a few weeks before at US election, you
Speaker 14: have to think through the effects on American politics if
Speaker 14: you're in Iran shoes. But I think there's a decided
Speaker 14: chance that yes, they would in fact take that approach.
Speaker 14: Would it be permanent, No, The Saudis could build more
Speaker 14: pipelines over their territory and go by land.
Speaker 11: We could go in and.
Speaker 14: Try to clear out whatever Iran was doing in the
Speaker 14: Persian Gulf by way of laying minds and using fast
Speaker 14: attack boats against ships and whatever else. I don't know
Speaker 14: that we would succeed perfectly, but you know we've escorted
Speaker 14: ships in the Persian Gulf before, so you could imagine
Speaker 14: ways to recover from this, But it would probably take
Speaker 14: a few weeks or maybe longer, and even after that
Speaker 14: point you might have a state of low grade ongoing
Speaker 14: hostilities with some chance of oil tankers still being hit
Speaker 14: even once we've reopened things. So I think Iran might
Speaker 14: very well consider that approach. You know, it works against
Speaker 14: their interests as well, so part of it depends on
Speaker 14: how hard Israel strikes them. If Israel really shuts down
Speaker 14: the Iranian oil economy, then Iran has no reason to
Speaker 14: tolerate the rest of the world using the strait of
Speaker 14: horror moves. But if Israel takes out five percent, leaving
Speaker 14: ninety five percent still effectively as hostage, then maybe Iran
Speaker 14: doesn't go that route and maybe does continue with the
Speaker 14: call for a ceasefire.
Speaker 4: Spending time with Michael o'halen from Brookings, I was really
Speaker 4: struck by a piece of reporting in the Washington Post.
Speaker 4: I wanted to ask you about here, Michael. Maybe we
Speaker 4: haven't fully understood the amount of damage that Iran brought
Speaker 4: to Israel in this most recent attack. Turns out, based
Speaker 4: on videos that have been verified by the Post, at
Speaker 4: least two dozen long range Iranian ballistic missiles broke through
Speaker 4: Israeli and Allied air defenses on Tuesday night, striking or
Speaker 4: landing near at least three military and intelligence installations. Did
Speaker 4: Iran do a better job than they were first given
Speaker 4: credit for.
Speaker 14: That's an excellent question, and you're right that the Post
Speaker 14: has done good reporting and that the Israelis have understandably
Speaker 14: been quiet about this. They don't want Iran to think
Speaker 14: that they've been successful. Clearly, if if there was enough damage,
Speaker 14: don there'd be no doubting it because all sorts of
Speaker 14: commercial satellites would have the damage by now, and so
Speaker 14: I have to suspect that the damage was not that severe.
Speaker 14: But you're right, there's a big difference between a dozen
Speaker 14: getting through and zero, and back in April, by all reports,
Speaker 14: basically zero got through. It does seem that very few
Speaker 14: people were hurt, regardless of whether some buildings were damaged.
Speaker 14: But you're right to raise that distinct possibility. And we
Speaker 14: really don't have firm understanding of whether the intercept probability
Speaker 14: was nine ninety nine percent.
Speaker 11: It's still an open question.
Speaker 2: Michael. There is a new Big Take piece out on
Speaker 2: the Bloomberg terminal that can be found on the terminal
Speaker 2: or online, and the headline reads as follows, Widening Midi's
Speaker 2: conflict shows limit of US leverage with Israel. The essential
Speaker 2: thesis of the piece here, Michael, is that the US
Speaker 2: can only do so much to actually influence the outcomes,
Speaker 2: and what the Israeli government does is the US desire
Speaker 2: to see things ease in the region. Anything that they're
Speaker 2: frankly telling the net Yahoo government consequential at this point
Speaker 2: or does it not matter?
Speaker 11: It's an excellent question.
Speaker 14: I don't know if the United States has had major
Speaker 14: leverage in any crisis over Israel since nineteen fifty six,
Speaker 14: the sus crisis. It's the last one where I can
Speaker 14: really feel or to say that the United States essentially
Speaker 14: carried the day, maybe in the seventy three Middle East War,
Speaker 14: but Israel wanted our help in a sense, at least initially,
Speaker 14: and then we needed We put pressure on them to
Speaker 14: agree to a ceasefire sooner than they wanted, but we
Speaker 14: still had their back, and their overall goals were not
Speaker 14: fundamentally different from what they achieved. And so in that regard,
Speaker 14: I think it's been a half century at least, maybe
Speaker 14: longer since we've really been able to coerce Israel into
Speaker 14: a plan of action that we preferred. And the last
Speaker 14: time it was really even tried by the United States
Speaker 14: except through browbeating and persuasion, was the first Bush administration
Speaker 14: suspending loan guarantees when the Israelis continued with occupation development
Speaker 14: no excuse me, you know, with housing development in the
Speaker 14: occupying territories, especially in the West Bank. And so it's
Speaker 14: been thirty plus years since anybody really even tried to
Speaker 14: use more than just nice words to persuade Israel to
Speaker 14: do something that we wanted them to do. You know,
Speaker 14: I can go through other cases. George W. Bush shut
Speaker 14: down a Rocky air space according to public accounts, when
Speaker 14: the Israelis wanted to think about bombing Iran back in
Speaker 14: two thousand and four or five six, when we control
Speaker 14: the Rocky air space, and at that time we told
Speaker 14: them no, and they had to take that for an
Speaker 14: answer because we were essentially the occupying power formally in
Speaker 14: that zone. We don't have control over a Rocky air
Speaker 14: space anymore. My whole point, you can see is that
Speaker 14: I don't know how often we have been able to
Speaker 14: tell Israel what to do as a sovereign nation, and
Speaker 14: we usually haven't even tried that.
Speaker 11: I do think we should try harder.
Speaker 14: I would withhold some of the two thousand pound bombs
Speaker 14: they've been using in Gaza, for example. But for the
Speaker 14: most part, this is not news. This is not something
Speaker 14: that just happened with Biden and net and Yahoo.
Speaker 4: Michael Rasashana ends tonight. What does that mean for this weekend.
Speaker 14: Well, one more reason why your earlier prediction that something
Speaker 14: might be brewing is probably correct, and I wouldn't be
Speaker 14: surprised at all, but this would happen sooner rather than later.
Speaker 14: But Israel also can take its time, you know, and
Speaker 14: I would rate the odds of something happening in the
Speaker 14: next week as more than fifty to fifty, but maybe
Speaker 14: not ninety ten.
Speaker 2: All right, Michael O'Hanlon, great to have you on this Friday. He,
Speaker 2: of course is Brookings Institution Senior Fellow and director of
Speaker 2: Research in the Foreign Policy Program. Really appreciate and of
Speaker 2: course Joe on a day in which we're talking about
Speaker 2: potentially an economic victory for Kamala Harris and this administration
Speaker 2: in the form of a stronger jobs report, we do
Speaker 2: also have to consider inflationary pressures that could readgnite as
Speaker 2: we talk about this conflict in the Middle East and
Speaker 2: oil prices that are now seven dollars a barrel higher
Speaker 2: on this Friday than they were when this week start.
Speaker 4: Another two percent today West Texas above seventy five dollars
Speaker 4: a barrel. What does that mean for gas prices at
Speaker 4: the end of October? If this hasn't been resolved yet.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
Speaker 1: us live weekdays at noon Eastern on Apocarplay and then
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Speaker 4: It says we dig deeper into the world of politics
Speaker 4: here on the Friday edition of Balance of Power, with
Speaker 4: a political cycle that has been so ridiculous it calls
Speaker 4: for a psychologist. And I'm not just trying to make
Speaker 4: jokes here. Is this campaign the death of truth? There's
Speaker 4: a question that a lot of people have been asking,
Speaker 4: got fake news from Russian bots, misinformation from Iran getting
Speaker 4: on to our social media AI bots are making videos
Speaker 4: that we can't tell are real or not. And then
Speaker 4: of course the candidates themselves saying things that, well, I
Speaker 4: wouldn't be up to me to call them lies, but
Speaker 4: maybe embellishments, maybe challenging the truth. Think about this whole
Speaker 4: conversation about Springfield, Ohio. They're eating cats and dogs and
Speaker 4: routing up the geese. Until you talk to the people
Speaker 4: in Springfield, it turns out that's not happening. And I'm
Speaker 4: reaching for this one example. Don't worry, We'll get to
Speaker 4: both sides here. Remember jd Vance called out on this
Speaker 4: when he did a bunch of Sunday morning shows, in
Speaker 4: this case on CNN, when he talked about creating stories
Speaker 4: to make a point. Let's go back to listen.
Speaker 7: Can you affirmatively say now that that is a rumor
Speaker 7: that has no base basis with evidence, Dana.
Speaker 17: The evidence is the first hand account of my constituents
Speaker 17: who are telling me that this happened. And by the way,
Speaker 17: I've been trying to talk about the problems in Springfield
Speaker 17: for months and the American media ignored it. If I
Speaker 17: have to create stories so that the American media actually
Speaker 17: pays attention to the suffering of the American people, then
Speaker 17: that's what I'm gonna do, Dana, because you guys are
Speaker 17: completely letting Kamala Harris coast.
Speaker 4: If I have to create stories, It's been echoing ever
Speaker 4: since he said it. Daniel Efron specializes in the psychology
Speaker 4: behind the way we interpret these messages because a lot
Speaker 4: of times, hey, let's be honest, voters like to be
Speaker 4: lied to, and other times voters can justify I won't
Speaker 4: call it a lie, but maybe an embellishment or a
Speaker 4: mistruth if it seems to codify something that they already believe.
Speaker 4: That's where Daniel's work comes in. He's Professor of organization
Speaker 4: will Behavior at the London Business School, social psychologist and
Speaker 4: with us now live on Bloomberg. Daniel, I'm so happy
Speaker 4: that you could join us. I have a lot of
Speaker 4: questions about your work, and I know that you've done
Speaker 4: very specific research on this. You've been writing about it
Speaker 4: for years as a matter of fact. But let me
Speaker 4: start with the big question. Is this campaign the death
Speaker 4: of truths?
Speaker 13: Thanks so much for having me on the program, Joe.
Speaker 13: You know people are often concerned about is everyone just
Speaker 13: believing all these falsehoods, misinformation, fake news? Why do people
Speaker 13: sometimes believe this stuff? Yeah, that's an interesting, important and
Speaker 13: important question. In my work, I look at something a
Speaker 13: little different, as you've alluded to. I'm interested in why
Speaker 13: people would tolerate falsehoods even when they.
Speaker 11: Get they're false.
Speaker 13: And the issue is, I see, it is not so
Speaker 13: much that people don't care about the truth anymore. It's
Speaker 13: that people are capable of thinking about the truth in
Speaker 13: different ways. We're all capable this, regardless of what side
Speaker 13: of the isle we're on, and the issue is that
Speaker 13: we define truth differently depending on who's telling the falsehoods.
Speaker 4: Well, you've actually done some real research in this area,
Speaker 4: which is it's great that you're with us to talk
Speaker 4: about this. And I'm referring back to a piece you
Speaker 4: wrote in The New York Times in twenty eighteen, how
Speaker 4: little Things have changed? And you write, wittingly or not,
Speaker 4: mister Trump's representatives have used a subtle psychological strategy to
Speaker 4: defend his falsehoods. They encourage people to reflect on how
Speaker 4: the falsehoods could have been true. And so Daniel sat
Speaker 4: down with more than twenty seven hundred Americans and asked
Speaker 4: them throughout by the way, from both sides of the
Speaker 4: political spectrum, to read a series of claims that they
Speaker 4: were told were false. They were false. What did you
Speaker 4: learn from these interviews?
Speaker 10: Daniel?
Speaker 11: That's great.
Speaker 13: So yeah, I do experiments where I randomly assign people
Speaker 13: to read about alsehoods in different conditions. The experiment you're
Speaker 13: alluding to was inspired by Trump's inauguration in twenty sixteen.
Speaker 13: You remember Sean Spicer went on TV and claimed it
Speaker 13: was the largest inauguration ever.
Speaker 11: In person or remotely right, And.
Speaker 13: Then the next day newspapers published side by side photographs
Speaker 13: showing that at the same time of day, Obama's inauguration
Speaker 13: a few years earlier had been bigger. Now it was
Speaker 13: instructive to see how members of the Trump administration respond
Speaker 13: to this. At some point they stopped defending the literal
Speaker 13: truth of that claim that the inauguration was the biggest,
Speaker 13: and they started saying or implying things like, well, the
Speaker 13: inauguration would have been bigger if the weather had been nicer,
Speaker 13: or it would have been bigger if security hadn't been
Speaker 13: so tight. Psychologists refer to these as counter factuals, where
Speaker 13: you kind of mentally undo reality and you think about
Speaker 13: how things could have turned out differently. Now, logically, these
Speaker 13: counterfactuals don't bring falls any closer to the truth, but
Speaker 13: psychologically they can make the falsehoods feel a little bit truthier,
Speaker 13: let's say. And we find in this and many other
Speaker 13: experiments that when you invite people to imagine that a
Speaker 13: falsehood could have been true if circumstances had been different,
Speaker 13: they think the falsehood is a little less unethical to tell.
Speaker 13: They're less inclined to want to punish the person who
Speaker 13: tells it. And this is particularly true if you like
Speaker 13: the person who's telling the falsehood, like if it's a
Speaker 13: politician that you.
Speaker 4: Support, isn't that right? Virtually everyone you talk to recognize
Speaker 4: the claims as being false. But as you just said
Speaker 4: and wrote quite well in The New York Times in
Speaker 4: this piece, a little imagination can apparently make a lie
Speaker 4: feel truthy enough to give the liar a bit of
Speaker 4: a pass. Now we've got lies, and of course the
Speaker 4: lying liars who tell them, forgive me, Daniel, but we
Speaker 4: also have sometimes embellishments.
Speaker 10: Right.
Speaker 4: Politicians love telling stories. They've been around the world and back.
Speaker 4: And in the case of Tim Walls, this came to
Speaker 4: a head during the debate just a couple of nights
Speaker 4: ago here, and I'd love to bring you back to
Speaker 4: that moment. This, of course, is Kamala Harris's running mate,
Speaker 4: and he had claimed to be in Hong Kong at
Speaker 4: the time of Tieneman. Turns out he was not, and
Speaker 4: he was called out on this during the debate. Here's
Speaker 4: how he handled it.
Speaker 14: Just to follow up on that, the question was can
Speaker 14: you explain the noterepancy?
Speaker 9: All I said on this was is I got there
Speaker 9: that summer and misspoke on this, so I will just
Speaker 9: that's what I've said. So I was in Hong Kong
Speaker 9: and China during the democracy protest went in and from
Speaker 9: that I learned a lot of what needed to be
Speaker 9: in governance.
Speaker 4: Okay, awkward at best, but I wonder, Daniel, if you
Speaker 4: can dig into the psychology behind this politicians who want
Speaker 4: to embellish their record that might make a supporter feel
Speaker 4: better about them, maybe codify feeling that they already have.
Speaker 4: Is there some parallel here?
Speaker 10: Sure?
Speaker 13: So in my recent studies, my colleagues and I find
Speaker 13: that when you support a political candidate, you start caring
Speaker 13: more about whether what they're saying speaks to a larger truth,
Speaker 13: is making a general point that you think is true,
Speaker 13: as opposed to caring about whether what they say is
Speaker 13: literally and precisely true. So another thing that Tim Walls
Speaker 13: has said is that he's been to China thirty times.
Speaker 13: His campaign later walked that back and said that it's something.
Speaker 11: Closer to fifteen.
Speaker 13: So I haven't studied this exact example in my lab,
Speaker 13: but the prediction I would make from our research is
Speaker 13: that if you're a Wall's opponent, you would say he
Speaker 13: said it was thirty, but it's actually fifteen.
Speaker 11: That's a lie, that's very dishonest. That's wrong.
Speaker 13: And if you're a Wall supporter, you might say something like, look,
Speaker 13: is it thirty, is it fifteen? Is it two? I mean,
Speaker 13: let's not get pedantic here. The sheets to China, bind
Speaker 13: shed it's informed his policy and.
Speaker 11: Of the Aisle.
Speaker 13: An example that I have studied in my lab. If
Speaker 13: you think back to Senator Katie Britt's response to Joe
Speaker 13: Biden State of the Union address some months ago. She
Speaker 13: was criticizing Biden's immigration policies, and she told a very
Speaker 13: upsetting story about a woman she had met who had
Speaker 13: been sex trafficked, ostensibly by Mexican drug cartels. And Britt said,
Speaker 13: you know, he wouldn't be okay with this. You remember this,
Speaker 13: She said, we wouldn't be okay with this happening in
Speaker 13: a third world country.
Speaker 11: This is the United States of America.
Speaker 15: Okay.
Speaker 13: So I had a Democrat and Republican participants watch a
Speaker 13: video clip of Brit making these remarks, and then they
Speaker 13: were shown actual fact chats from Fox News, PolitiFact, other
Speaker 13: sources saying, well, it's true that Britt met someone who
Speaker 13: had been sex traffic, but some of the details were wrong.
Speaker 13: This didn't happen at the border, It didn't happen because
Speaker 13: of Mexican drug cartels. Cartels were not involved, and it
Speaker 13: actually happened during the George W. Bush administration. So then
Speaker 13: I asked Democrats and Republicans how dishonest are BRIT's remarks
Speaker 13: and why. Democrats say it's very dishonest because she's making
Speaker 13: up facts. This none of this stuff isn't true. Republicans
Speaker 13: say it's not so dishonest because, look, she may have
Speaker 13: chosen the wrong story, but this stuff happens all the time.
Speaker 13: The issue she's talking about is true. So again, whether
Speaker 13: you're a Democrat or a Republican, if you support someone
Speaker 13: that's telling you falsehoods, you might not care so much
Speaker 13: if you think the falsehoods speak to a broader truth.
Speaker 13: And this is what I meant earlier when I said
Speaker 13: that it's not that people don't care about truth, it's
Speaker 13: that they may just define truth differently depending on who's
Speaker 13: lying to them.
Speaker 4: Ah, the alternate facts. I've got less than a minute, Daniel.
Speaker 4: I don't mean to set you up to cut you off,
Speaker 4: but don't we love to be lied to voters love
Speaker 4: to be lied to. Is that not part of the story.
Speaker 11: Well again, I don't.
Speaker 13: Know that people are seeing all of these falsehoods as
Speaker 13: as lies.
Speaker 4: That is what I want you to tell me, what
Speaker 4: I want to hear. That's the point, Daniel, Make me happy.
Speaker 11: Yeah, I look.
Speaker 13: I think when voters want to hear falsehoods, they define
Speaker 13: dishonesty in different ways. And you know whether it's reasonable
Speaker 13: to care about details or whether it's reasonable to care
Speaker 13: about the gist, the broader picture of what someone's saying.
Speaker 13: We're all capable about caring about both. The problem is
Speaker 13: we're just maybe a little hypocritical and how we apply
Speaker 13: those standards.
Speaker 4: Love talking to you, Daniel Fron. I do this in
Speaker 4: person sometimes. He's the professor of organizational behavior at London
Speaker 4: Business School. Maybe I'll come over there and see a
Speaker 4: social psychologist. How about James, let's get a residence psychologist
Speaker 4: for Balance of Power for the next four weeks. I
Speaker 4: need one today. Thanks for listening to the Balance. It's
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Speaker 4: at Noontimeeastern at Bloomberg dot com.