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Speaker 2: It's going to be a busy week here in Washington
Speaker 2: as one hundred and eighteenth Congress tries to wrap up
Speaker 2: its work for the year. That, of course, will include
Speaker 2: finding a way to keep the government open past midnight
Speaker 2: on Friday, where the deadline is, and we have no
Speaker 2: deal yet as to how exactly that happens. We know
Speaker 2: it will be a stopgap measure of sometime likely going
Speaker 2: into March. We just don't know how exactly the sausage
Speaker 2: is going to be made and what compromise the Democrat
Speaker 2: and Republican leaders in both chambers will reach.
Speaker 3: But we do know what does need to.
Speaker 2: Get done and get a signature from President Biden, buy
Speaker 2: that deadline on Friday, so that when we come back
Speaker 2: in January and the one hundred and nineteenth Congress takes
Speaker 2: its seats, they can get started on their to do list,
Speaker 2: and certainly the incoming chairs of the various committees in
Speaker 2: the House have to do lists of their own, and
Speaker 2: one of them is joining us now here on Bloomberg
Speaker 2: TV and Radio. He was just named the incoming chair
Speaker 2: of the House Financial Services Committee, and his live with
Speaker 2: me from Capitol Hill. Congressman French Hill of Arkansas. Congratulations sir,
Speaker 2: first and foremost for getting the gabble here, and I
Speaker 2: do want to get into everything you want to accomplish
Speaker 2: in financial services in the two years ahead. Could we
Speaker 2: just begin, though, with what exactly is going to happen
Speaker 2: this week? Is there's not a lot of time to
Speaker 2: work with here, and I wonder if the seventy two
Speaker 2: hour rule to read this stopgap legislation after its released
Speaker 2: is going.
Speaker 3: To have to be waived.
Speaker 4: Well, Kayley, it's always good to be with you. Thanks
Speaker 4: for having me. Usually we hope to have that bill
Speaker 4: post it over the weekend, and we didn't see it,
Speaker 4: so you're right, we may be cons it with a
Speaker 4: tight time frame in order to review it before we
Speaker 4: have to vote on it and get the Senate to
Speaker 4: approve it before Friday.
Speaker 2: Well, that certainly is true. And when we talk about
Speaker 2: it being a deal making here we understand that the
Speaker 2: Speaker is looking for economic aid to farmers and might
Speaker 2: need to offer out something else to Democrats in exchange
Speaker 2: for that. Are you concerned at all about what additional
Speaker 2: provisions Democrats want could work its way into this continuing resolution?
Speaker 4: Well, sure, because the real issue is that the continuing
Speaker 4: resolution be done at the Fiscal Responsibility Act levels. This
Speaker 4: is the agreement. I think the Speaker's done an outstanding
Speaker 4: job negotiating that. But our farm counties in this country
Speaker 4: are facing a crisis. The last three years have been
Speaker 4: bad on pricing. There were high supplies and number of
Speaker 4: commodities this year which depressed price furthers. So they've had
Speaker 4: high costs from the Ukraine invasion plus now low prices
Speaker 4: this year. So it's tough to be refinanced if you've
Speaker 4: had three bad years of a row. I was an
Speaker 4: ag lender many many years ago in banking, so I
Speaker 4: know how tough that is. The Speaker is trying to
Speaker 4: get a deal where we just simply help the farm economy.
Speaker 4: I don't know why the Democrats are trying to take
Speaker 4: advantage of farmers who are hurting. This is not like
Speaker 4: it's a Republican policy. It's an American policy and try
Speaker 4: to help these farmers get through a tough period.
Speaker 2: Well, I'm glad you raise your background is once being
Speaker 2: a lender and community banker, sir, as, we understand that
Speaker 2: is one of the reasons why you were able to
Speaker 2: win the gavel in what was a competitive race for
Speaker 2: the Chairmanship of Financial Services. So let's get into what
Speaker 2: you want to accomplish. I'd like to begin with crypto
Speaker 2: as this is Bloomberg TV and Radio. We obviously saw,
Speaker 2: as you shared the Digital Asset Subcommittee, through your committee
Speaker 2: and the House, the passage of the FIT twenty one
Speaker 2: Act Crypto Market Structure legislation that divvied up responsibilities between
Speaker 2: the CFTC and SEC.
Speaker 3: Are you going to start.
Speaker 2: There and make changes or would you rather start from
Speaker 2: scratch when it comes to crypto market structure?
Speaker 4: Well, first, Dusty Johnson from South Dakota and Gt. Thompson
Speaker 4: of Pennsylvania, both on the AD Committee, where my partners.
Speaker 4: They'll be my partners again in this Congress. We don't
Speaker 4: have a learning curve here. We can take the lessons
Speaker 4: that we learned in one hundred and eighteenth Congress by
Speaker 4: producing FIT, which was a bill that got seventy one
Speaker 4: Democratic votes here in the House, and the work that
Speaker 4: Chairman mckenry did with the ranking Member Maxine Waters on
Speaker 4: a stable coin bill.
Speaker 3: Both those will be.
Speaker 4: Priorities coming into the new Congress. We want to work
Speaker 4: with the Trump administration and Senate Banking Committee Chairman Tim
Speaker 4: Scott and try to get all of us on the
Speaker 4: same page as to how do we proceed in one
Speaker 4: hundred and nineteenth. We've got new interest in the Senate.
Speaker 4: Bill Haggerty of Tennessee introduced his own bill in and
Speaker 4: around digital assets just before the election.
Speaker 2: Well, so when we consider though the actual market structure
Speaker 2: questions here, Obviously, when FIT twenty one was passed, Gary
Speaker 2: Gensler was the chair of the SEC s he is
Speaker 2: now that will be changing in the new administration. Presumably
Speaker 2: it will be Paul Atkins, And I wonder if you're
Speaker 2: more comfortable with the SEC having greater authority over crypto
Speaker 2: compared to the CFTC under that kind of regime, if
Speaker 2: it's no longer going to be Gary Gensler at the helm.
Speaker 4: Well, we didn't draft the FIT twenty one legislation because
Speaker 4: Gary Gensler was the chairman of the SEC. We drafted
Speaker 4: it because we thought there needed to be clear, transparent, transparent,
Speaker 4: fit for purpose rules of the road for digital asset
Speaker 4: companies so that tokens that are on a decentralized functioning
Speaker 4: blockchain are treated differently. They're not treated as securities. And
Speaker 4: we put that in law and defined exactly how to
Speaker 4: do it. And I think that's still important for the
Speaker 4: SEC under President Trump and Paul Atkins as the chairman elect,
Speaker 4: because there's some things you can do by exemptive relief
Speaker 4: at the SEC, but there are other things that you
Speaker 4: actually need statutory work for. We're prepared to work with
Speaker 4: the new chairman the new Commission, but permanent changes come
Speaker 4: from making legal changes, not just doing exemptive relief at
Speaker 4: the Commission. So I prefer a legislative solution, but I
Speaker 4: want to work with the chairman and see how we
Speaker 4: can work together.
Speaker 5: Well.
Speaker 2: And I do wonder about the working with not just
Speaker 2: other chairmen in the House and in the Senate, but
Speaker 2: others in this administration, like say David Sachs, Congressman, what
Speaker 2: is your relationship like with him or with other agencies
Speaker 2: that we understand the White House. We'll be giving a
Speaker 2: voice here in the shaping of crypto policy.
Speaker 4: Well, we had a great relationship with the banking regulators,
Speaker 4: the Treasury and the White House and the Biden administration
Speaker 4: on this topic, and I expect this will be even
Speaker 4: better in the Trump administration. The National Economic Council, with
Speaker 4: Kevin Hastrett and Treasury Secretary Designate Descent, the banking Supervisor
Speaker 4: that President Trump will appoint, all of us will work
Speaker 4: together along with the SEC Chairman on crafting the best
Speaker 4: policy for digital assets. We want America to have a
Speaker 4: growth policy and a fairness and a transparent policy on
Speaker 4: how to have a digital asset economy here in America
Speaker 4: that produces growth. We want to add employees here. We
Speaker 4: don't want this business driven offshore as we witness during
Speaker 4: the Gensler and Biden Harris regime.
Speaker 2: Well, we know the President elect has talked about making
Speaker 2: the US the bitcoin capital of the world. He's also
Speaker 2: floated this notion, Sir, of a bitcoin reserve. Do you
Speaker 2: have any concerns with an establishment of that?
Speaker 4: Well, actually, I think Senator Loomis floated the idea of
Speaker 4: the reserve, and President Trump heard about it when he
Speaker 4: was at the Bitcoin conference in Nashville during July This
Speaker 4: is something that has to be looked at carefully if
Speaker 4: that has benefits to the US Treasury and to the
Speaker 4: US balance sheet, and I'm sure Congress and members on
Speaker 4: both sides of the capital will do that.
Speaker 2: As we get into other banking matters as well, would
Speaker 2: you support a move to abolish the FDIC and to
Speaker 2: fold its duties into the Treasury Department.
Speaker 4: I think you've got to look at whatever proposals that
Speaker 4: the incoming administration has as part of a matrix, like
Speaker 4: what is the big picture objective here? Most people in
Speaker 4: Congress want outstanding, coordinated, harmonized supervision of our financial institutions
Speaker 4: that encourage new banks, encourage growth, encourage of fair minded
Speaker 4: rules and the capital standards. And they don't want to
Speaker 4: create a situation where our community banks are going out
Speaker 4: of business because they can't comply with all the rules.
Speaker 4: And we want tailoring, that is, we want smaller banks
Speaker 4: with simpler balance sheets and simpler strategies to be treated
Speaker 4: differently than a big, large, complex company like City Bank
Speaker 4: or JP Morgan Chase. But we're willing to listen to
Speaker 4: what proposals that the administration has on supervisory changes.
Speaker 2: So that's not a no that you wouldn't necessarily be
Speaker 2: opposed from the start on abolishing the FDIC or shifting
Speaker 2: the way in which that insurance mechanism actually happens in
Speaker 2: the US.
Speaker 4: Well, I don't personally, I've never seen anybody submit an
Speaker 4: idea like that. I've read about it in the newspaper.
Speaker 4: But I think deposit insurance is an important feature. We
Speaker 4: want to make sure it's run right. The FDIC has
Speaker 4: a poor leadership right now, but it's been an institution
Speaker 4: that's carried out its mission in a very tailored way.
Speaker 4: And I would just argue that we have, mostly in
Speaker 4: the Biden Harris regime, a personnel problem, not a structural problem.
Speaker 4: But the supervisory process in our country between state and
Speaker 4: federal supervisors has gotten convoluted. It's gotten in conflict with
Speaker 4: each other, it's not harmonized, it's not coordinated, and so
Speaker 4: there are a lot of improvements that need to be made,
Speaker 4: in my view, in bank supervision. So again I'm open
Speaker 4: minded about how those could be made. But just taking
Speaker 4: one out of context and saying that you should do
Speaker 4: away with the FDIC, I don't think so particularly the
Speaker 4: right way to go about it.
Speaker 2: Well, if it is to stick around. What do you
Speaker 2: see whoever Trump taps to lead the FDIC and the
Speaker 2: OCC for that matter, as their chief priority, what would
Speaker 2: you hope that they deal with first?
Speaker 4: Well, first tailoring, following the law, making sure that their
Speaker 4: light touch regulation where it's deserved, and heavy complex tux
Speaker 4: regulation where it's merited because of the nature of the business. Further,
Speaker 4: I think they have to understand that fintech is here
Speaker 4: and AI is here, and they need to deal with
Speaker 4: that reality and make sure that all banks of all
Speaker 4: sizes and broker dealers of all sizes are treated in
Speaker 4: the right way according with their business plan. But debank
Speaker 4: banking businesses because they're involved in the fintech or the
Speaker 4: crypto business is not a good approach. And that's what
Speaker 4: we've seen in the Biden Harris administration, and in my view,
Speaker 4: that's a key point to get changed as we change administrations.
Speaker 4: We do not want customers de banked because they're in
Speaker 4: a legal business, and we don't want to see banks
Speaker 4: and thrifts or credit unions or broker dealers treated inappropriately
Speaker 4: by the supervisors.
Speaker 2: Well, certainly, we've seen a number of pursuits during this
Speaker 2: administration in regard to banking, including, of course, the initial
Speaker 2: proposal of the BOSL three un gained by the FEDS
Speaker 2: Vice Chair of Supervision Michael Barr. That obviously is now
Speaker 2: being changed. It's unclear what form it's ultimately going to take, sir,
Speaker 2: and I do wonder how you at the Financial Services
Speaker 2: Committee are hoping to shape ultimately that endgame and what's
Speaker 2: going to happen to capital requirements, assuming Michael Barr is
Speaker 2: still going to be the guy in this role.
Speaker 4: Well, look, the Board of Governors is responsible for obviously
Speaker 4: that decision, and I don't believe that the Board of
Speaker 4: Governors is supportive of Basil three in game as proposed.
Speaker 4: I think President Trump should withdraw that rule and repropose
Speaker 4: whatever the right, more balanced approach is. It got thousands
Speaker 4: of comments, they were all negative, and I don't believe
Speaker 4: that the Biden Harris's effort to just simply tweak the
Speaker 4: proposal and re release it is the way to go.
Speaker 4: I think it should be withdrawn and then be reconsidered
Speaker 4: by the Trump administration.
Speaker 2: As we consider other Biden era banking policies. Would you
Speaker 2: support a congressional review through the Congressional Review Act of
Speaker 2: any of them?
Speaker 4: Well, we have. We've done that for the Small Business
Speaker 4: Data Reporting, which is Section ten seventy one that was
Speaker 4: a CFPB proposal. We've done that for the currents the
Speaker 4: Corporate Transparency Act, which I still hope gets put in
Speaker 4: the cr this week to delay that. This is this
Speaker 4: beneficial ownership reporting for thirty two million American small businesses
Speaker 4: that I believe is the wrong approach and handled in
Speaker 4: an incorrect way. So I hope that we can. We've
Speaker 4: used the CRA for that, and we want to try
Speaker 4: to delay the implementation of that for a year since
Speaker 4: to give us an opportunity to reconsider it. We'll use
Speaker 4: the Congressional Review Act, We'll use our Article one power
Speaker 4: on funding through looking at activities in the Financial Services
Speaker 4: Committee that are not currently authorized, and so we're going
Speaker 4: to use all the oversight authorities that we have at
Speaker 4: house financial Services to roll back what we believe to
Speaker 4: be an inappropriate level of regulation proposed by Biden. Harris.
Speaker 2: I'd like to ask you, as well, Congressman, about something
Speaker 2: we're hearing a lot about in Washington these days as
Speaker 2: we get ready for the second administration and for the
Speaker 2: DOGE to make their commendations.
Speaker 3: It's this idea of remote.
Speaker 2: Work or perhaps a return to working in the office
Speaker 2: instead of working remotely for those who work in Washington
Speaker 2: through federal agencies. Is there anything Congress can do to
Speaker 2: help the administration this incoming administration see through that goal
Speaker 2: of having people return to the office, even if there's
Speaker 2: existing union contracts that allow them to work from home.
Speaker 4: Well, I think this is the advantage of the Doze
Speaker 4: process with Vivek and Elon. I think it's good to
Speaker 4: have for profit business executives look at the sedimentary regulatory
Speaker 4: burden that's been built up over years, and also the
Speaker 4: HR and work practices in the bureaucracy and try to
Speaker 4: find ways to do things in a more effective way,
Speaker 4: efficient way, and where possible, to get out of certain
Speaker 4: businesses that are not necessary. We have a real issue
Speaker 4: here in Washington, d C. I think the last number
Speaker 4: I saw Kayley was only about forty percent of the
Speaker 4: federal work force in the District of Columbia is in
Speaker 4: the office. And so the question is is that appropriate
Speaker 4: or inappropriate based on the kind of work that they're doing.
Speaker 4: We've seen since the pandemic, the whole economy shift workflows,
Speaker 4: and so from a federal government point of view. Maybe
Speaker 4: they don't need to do that in some areas, like
Speaker 4: if you're working in an auditing capacity, maybe you're on
Speaker 4: the road a lot or working from a computer and
Speaker 4: you want to do that from home. But that's the
Speaker 4: kind of good, straightforward look I think we'll get from
Speaker 4: Doje in Veka and Elon as they work with these
Speaker 4: Cabinet secretaries to assess workloads, management techniques, the use of technology,
Speaker 4: and the use of where people should be during the workday.
Speaker 2: All right, Congressman, thank you so much for being generous
Speaker 2: with your time on Bloomberg TV and radio today. That's
Speaker 2: Republican Congressman French Hill of Arkansas, the incoming chairman of
Speaker 2: the House Financial Services Committee. Happy holidays to you, sir,
Speaker 2: and will see you in one hundred and nineteenth, when he,
Speaker 2: of course, will be taking that gavel. We still have
Speaker 2: much more ahead here on balance of power. He of course,
Speaker 2: was just talking about the DOGE, those two co leaders
Speaker 2: of the dough to vag Ramaswami and Elon Musk. We're
Speaker 2: in the DC area in Landover, Maryland, specifically this weekend
Speaker 2: at the Army Navy Game with a laundry list of
Speaker 2: others including President elect Donald Trump, the House Speaker Mike Johnson,
Speaker 2: the incoming Senate Majority Leader John Thune. Reconciliation and what
Speaker 2: exactly is going to happen with taxes and the budget
Speaker 2: next year was on the agenda, and of course there
Speaker 2: were cabinet nominees in tow as well, So we're going
Speaker 2: to get into that next. Our signature political panel, Rick
Speaker 2: Davis and Jeanie Shanzino will join me on Bloomberg TV
Speaker 2: and Radio.
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Speaker 2: Welcome back to Balance of Power on Bloomberg TV and Radio,
Speaker 2: where we've been dealing with a lot of news today,
Speaker 2: including news from down in Florida. We're at mar A Lago.
Speaker 2: The CEO of SoftBank, Masoshi's Sun, met with Donald Trump
Speaker 2: this morning, pledging to invest one hundred billion dollars in
Speaker 2: the US over the next four years. That money to
Speaker 2: be spent on things like infrastructure to support artificial intelligence
Speaker 2: apparently could bring one hundred thousand jobs with it now.
Speaker 2: Their meeting was followed by a press conference in which
Speaker 2: we heard from both of them. Donald Trump, we heard
Speaker 2: from for an extended period of time on a number
Speaker 2: of subjects well beyond just this soft bank investment, and
Speaker 2: we want to get into all of that now with
Speaker 2: Laura Davison, who is Bloomberg Politics editor here with me
Speaker 2: in our.
Speaker 3: Washington, d C. Studio.
Speaker 2: So, Laura, in that press conference, he did talk about
Speaker 2: this soft bank investment, but he also talked about the
Speaker 2: fact that Tim Cook and a number of other tech
Speaker 2: executives have come to visit him at mar Alago. He
Speaker 2: says this term is different, that everyone wants to be
Speaker 2: his friend now in the tech world, and I guess
Speaker 2: we add Mashiyoshi's son to that list of people who
Speaker 2: want to get friendly with the president elect.
Speaker 6: Yes, there have been a series of meetings in the
Speaker 6: past couple of days. We've had Mark Zuckerberg go down,
Speaker 6: We've had the Google CEO Pinchai, We've had Bezos is
Speaker 6: scheduled to come this week. On Friday, he met with
Speaker 6: Tim Cook from Apple. So there is a real outreach
Speaker 6: in the business community that just didn't happen eight years ago.
Speaker 6: You know, part of this was they didn't know Trump,
Speaker 6: they didn't know how he operated, They didn't even know
Speaker 6: you know who in his orbit to call to even
Speaker 6: set up a meeting. And now you have people realizing
Speaker 6: that this is if they want to be in Trump's
Speaker 6: good graces, if they want to have this personal relationship
Speaker 6: because that's how he does business, they need to personally
Speaker 6: go there, set up a meeting, set up a dinner.
Speaker 6: This worked out really well for Tim Cook during the
Speaker 6: first term he was you know, it was sort of
Speaker 6: a rarity among big CEOs who went down and he
Speaker 6: was able to fend off most of the tariffs that
Speaker 6: that Trump was going to impose on iPhones. So you
Speaker 6: see this recognition from people saying, look, we need to
Speaker 6: go down, we need to meet with them, and you know,
Speaker 6: potentially be able to to influence some of these decisions
Speaker 6: before things that we don't like, like tariffs, come down
Speaker 6: the pike.
Speaker 2: Well, so I do wonder about sequencing here when it
Speaker 2: comes to the soft Bank investment in particular, because it
Speaker 2: was what just last week Trump posted on true Social Hey,
Speaker 2: if you want to invest one billion dollars in the US.
Speaker 2: I'll get you expedited permits, get ready to rock and
Speaker 2: Maciochi Sun comes in a week later and says, how
Speaker 2: about one hundred billion? Is there is there a line
Speaker 2: connecting those two things?
Speaker 3: There certainly is.
Speaker 6: And you also, this is sort of a move that
Speaker 6: SoftBank has done in the past. You know, they have
Speaker 6: previous said they would invest fifty billion dollars. You know,
Speaker 6: that had some some kind of went down in a
Speaker 6: couple of ways with with deals not actually following through,
Speaker 6: but kind of coming in with a big headline number.
Speaker 6: Saying look, we're going to invest one hundred billion dollars
Speaker 6: really starts almost kind of this bidding war between other
Speaker 6: companies being say, hey, look, you know we're bringing this money,
Speaker 6: we're bringing this jobs. You know, what what can you
Speaker 6: do for US, mister president? And they you know, even
Speaker 6: you know, my son, the soft mak CEO got a
Speaker 6: press conference out of this. So that's a real, uh,
Speaker 6: you know, a real tangible benefit that attaches that saying look,
Speaker 6: I have you know, essentially the most powerful man in
Speaker 6: the world, who is you know, willing to give his
Speaker 6: first press conference really since becoming president or since becoming
Speaker 6: president elect.
Speaker 3: That's a that's a major mark for SoftBank.
Speaker 2: Well, and just quickly on that, Laura, this was an
Speaker 2: extended press conference. It went well beyond the soft Bank investment.
Speaker 2: We touched Ukraine, we touched who's invited, the inauguration, tariffs,
Speaker 2: taxes January sixth, the polio vaccine. What stood out to
Speaker 2: you the most of this morning's extended affair.
Speaker 3: I mean a couple of things.
Speaker 6: One is, this is on Laura Trump and the Senate seat.
Speaker 6: You know, he'd mentioned that, you know, he does not
Speaker 6: think that Desanta is going to give that a seat
Speaker 6: to her. He also, you know, was very critical of
Speaker 6: Biden on several things, on you know, the foreign wars,
Speaker 6: on Ukraine, on Israel, but also on the drone sightings
Speaker 6: that have continued to spark concern, particularly in the Northeast.
Speaker 6: He said that the government knows something and they should
Speaker 6: reveal it. You know, he did not cite any evidence
Speaker 6: for that. It's not clear. The Pentagon and the White
Speaker 6: House come out and said there's no risk there. But
Speaker 6: this is clearly going to be a flashpoint going forward
Speaker 6: as well.
Speaker 2: Yeah, everybody's obsessed with the drones now. I have questions
Speaker 2: about the drones.
Speaker 3: I think we all do.
Speaker 2: Bloomberg's Laura Davison, or politics editor here in Washington, thank
Speaker 2: you so much. Now, before Donald Trump was in mar
Speaker 2: A Lago today, he spent part of his weekend in
Speaker 2: this area and landover Maryland at the Army Navy game,
Speaker 2: which of course was a big deal, in part because
Speaker 2: Navy pretty much dominated, played a great game. Go Navy,
Speaker 2: but also because along with Donald Trump, there were a
Speaker 2: number of other high profile individuals and attendance, including the
Speaker 2: vaik Ramaswami and Elon Musk who are going to be
Speaker 2: running this Department of Government Efficiency cabinet secretary nominees including
Speaker 2: Pete Hegseth who has been tapped for the Department of Defense,
Speaker 2: and Tulci Gabbard for the Director of National Intelligence. And
Speaker 2: he had Senator John Thune, the incoming Senate majority leader,
Speaker 2: as well as House Speaker Mike Johnson discussing things with
Speaker 2: the president, not just football, but how they want to
Speaker 2: deal with Trump's agenda when he takes office. It's a
Speaker 2: question of sequencing here. Do you pass one budget reconciliation
Speaker 2: package with everything in it, or do you split it up?
Speaker 2: Dealing with the border first and taxes later. So let's
Speaker 2: get into this now with our signature political panel, Rick
Speaker 2: Davis stone Court Capital Partner and Republican strategists alongside Democratic
Speaker 2: strategist Genie Schanzino, who is a Senior Democracy Fellow at
Speaker 2: the Center for the Study of the Presidency and Congress. So, Genie,
Speaker 2: if we consider how all of this is going to
Speaker 2: shake out, it's very likely. It seems that this is
Speaker 2: going to end up in two packages. Right, We're going
Speaker 2: to try to get something done immediately on the border,
Speaker 2: which Donald Trump campaigned on, and then wait for his
Speaker 2: other campaign promise on taxes until later in the year.
Speaker 7: Yeah, I think so, it's clearly. I mean, we have
Speaker 7: heard Trump's associates, some of the closest aids he has
Speaker 7: make the case, such as Stephen Miller, that that's how
Speaker 7: it should be done. We have heard from the incoming
Speaker 7: majority leader of the Senate. There has been some pushback
Speaker 7: on the House side, but you know, as you look
Speaker 7: at it and the difficulty of doing this, I think
Speaker 7: it does make sense for him as far as possible
Speaker 7: to get a win. And also we heard Lindsey Graham
Speaker 7: over the weekend making the case that you have to
Speaker 7: deal with security at the border and national security before
Speaker 7: you attempt these other things. I think that's what we're
Speaker 7: hearing more and more from the President and the incoming administration.
Speaker 2: Well, so as we consider the fact that there is
Speaker 2: some consternation, if you will, about at least what some
Speaker 2: members of the House, like the chair of the Ways
Speaker 2: and Means Committee, Jason Smith, want to do here Rick
Speaker 2: versus what John Thune wants to do with. Isn't Thune's
Speaker 2: majority that he's dealing with more comfortable? The House is
Speaker 2: going to have very few few votes that Republicans can lose.
Speaker 2: And if Jason Smith is saying no, I'm telling you,
Speaker 2: doing this is one package, is the way I get
Speaker 2: these votes. Should it not be his voice that's listened to?
Speaker 8: Yeah, I think it's probably going to be his voice
Speaker 8: is listened to, mostly because of the point you make, Kayley,
Speaker 8: which is it's just simply easier to get things done.
Speaker 8: I mean, look at the problem we're having now even
Speaker 8: getting this stopgap measure. The margins are so thin that Democrats,
Speaker 8: if they don't go along, you know, with the provisions
Speaker 8: on the agriculture spending, that they can stop it. From
Speaker 8: happening as they have, and all of a sudden, instead
Speaker 8: of getting this done yesterday, we're still talking about it
Speaker 8: today and time is running short. The last thing that
Speaker 8: Trump wants to do is have his agenda kept hostage
Speaker 8: by Democrats and some Racalcua Trent Republicans and the House
Speaker 8: of Representatives. So he wants to get whatever he can
Speaker 8: get quick. And of course we do know his priorities
Speaker 8: are the border. It's border, border, border. He can do
Speaker 8: the tariff, economic, geopolitical stuff himself. And he wants to
Speaker 8: clear the path for more energy development in the country.
Speaker 8: And so those things top of mind in the Senate.
Speaker 8: Let's get it done and we'll get to the taxes
Speaker 8: as the year goes on.
Speaker 2: Well, I want to get into another question that was
Speaker 2: raised by the attendance at the Army Navy Game this weekend, Rick,
Speaker 2: and that was that in the presidential suite with the
Speaker 2: President elect where some of his controversial cabinet nominees, namely
Speaker 2: Pete Hegseth, who has been tapped for Secretary of Defense.
Speaker 2: What is the signal there of him being there literally
Speaker 2: next to Donald Trump and very close proximity to him,
Speaker 2: Is that Trump saying, you know, I have confidence that
Speaker 2: this guy is ultimately going to be confirmed. Or is
Speaker 2: that Trump threatening others in attendance or who were viewing
Speaker 2: the events of Saturday saying I am with this guy
Speaker 2: no matter what, and you need to do what I
Speaker 2: say when I say that I want him in that slot.
Speaker 8: Yeah, probably more the latter. First of all, Trump is
Speaker 8: always confident that he's going to get what he wants.
Speaker 8: But I do think in this Cassie realizes that this
Speaker 8: is a lift that he's going to have to do
Speaker 8: in order to get this nominee in particular through. And
Speaker 8: I would say too, who was on the right hand
Speaker 8: side of Donald Trump in that suite, Telsea Gabber, somebody
Speaker 8: who he believes Donald Trump leaves will need that same
Speaker 8: kind of lift. So his two most troublesome cabinet picks
Speaker 8: right now we're flanking him at that event. I would
Speaker 8: say too. An interesting person who is there who's had
Speaker 8: his own issues with Donald Trump was the chairman of
Speaker 8: the Joint chiefs of Staff c Q. Brown evidently in
Speaker 8: that suite, and somebody who likely may lose his job
Speaker 8: because of this present.
Speaker 2: Yeah, a very good point to flag Rick. So We've
Speaker 2: talked about Pete Hegseth and Toulci Gabbard as being their genie.
Speaker 2: There's also the question this week of RFK Junior, because
Speaker 2: he'll be meeting with senators throughout the course of the week.
Speaker 2: In fact, some twenty five of them will be meeting
Speaker 2: with the Health and Human Services Secretary nominee. We heard
Speaker 2: Donald Trump talking about him from mar A Lago in
Speaker 2: that press conference this morning, suggesting that he is not
Speaker 2: as extreme perhaps as others may seem to think that
Speaker 2: he is, that the polio vaccine isn't going anywhere. But
Speaker 2: how difficult is it going to be for RFK Junior
Speaker 2: to make that case himself as he takes these meetings
Speaker 2: this week.
Speaker 7: Yeah, I mean, he's certainly skilled at this is He
Speaker 7: is famously a very good presenter, and he's very good
Speaker 7: in meetings. He's very engaging. That said, you know, Donald
Speaker 7: Trump not only said that he himself is a big
Speaker 7: believer in the polio vaccine during that press EFTs, but
Speaker 7: he also at the same time suggested he would give
Speaker 7: RFK Junior wide latitude. And that's going to be concerning
Speaker 7: to some of these senators. We've already heard from somebody
Speaker 7: like Mitch McConnell. And you know, the reality is Number one,
Speaker 7: RFK has zero public health expertise. He is an environmental lawyer.
Speaker 7: Number Two, he spread lies about the COVID vaccine and
Speaker 7: has associated with anti vaxxers on polio and other things.
Speaker 7: This is deeply concerning to not just Mitch McConnell, but
Speaker 7: many Republicans in the Senate. And that's why we understand
Speaker 7: he's going to go in there starting today and he's
Speaker 7: going to downplay this skepticism of vaccines. He's going to
Speaker 7: downplay his abortion stance and try to be appealing. But
Speaker 7: I think it is going to be a challenge for
Speaker 7: him to thread that needle. That said, you know, I
Speaker 7: look back, Kayley, we have had only one nominee of
Speaker 7: the President's cabinet in like the last thirty five years
Speaker 7: denied in the Senate. Almost everyone who left has withdrawn
Speaker 7: themselves or been withdrawn by the president. So if he
Speaker 7: gets over that hurdle, statistically, he's likely going to get through.
Speaker 5: All right.
Speaker 2: Jeanie Shanzeno always bringing the stats for us here on
Speaker 2: Bloomberg TV and Radio alongside the other half of our
Speaker 2: signature political panel Rick Davis.
Speaker 3: Thank you both.
Speaker 2: I should note Rick Davis was also at that Army
Speaker 2: Navy game on Saturday.
Speaker 3: We're both Navy fans.
Speaker 2: I think we're both feeling pretty good on Saturday night.
Speaker 2: But it is Monday, and we still have more of
Speaker 2: our Monday edition of Balance of Power ahead here, So
Speaker 2: stick with us on Bloomberg.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 2: It has been just over one week since the toppling
Speaker 2: of Basher al Assad's regime in Syria. He was, of
Speaker 2: course ousted by a rebel group HTS, which is a
Speaker 2: designated terrorist organization by the US. But we learned this
Speaker 2: weekend from the US Secretary of State Anthony Blincoln, who
Speaker 2: was speaking in Jordan as he wrapped up a trip
Speaker 2: to the Middle East in the aftermath of Assad's fall,
Speaker 2: that the US has had direct talks with HTS, as
Speaker 2: well as a number of other groups. He said that
Speaker 2: those talks focused on a set of principles that they
Speaker 2: want to guide this transition of power in Syria, as
Speaker 2: well as the importance of finding Austin Tice, who, of course,
Speaker 2: is a missing American journalist still unaccounted for in the country.
Speaker 2: Let's hear more of what Secretary Blincoln had to say
Speaker 2: in Jordan on Saturday.
Speaker 9: We've seen how the fall of a repressive regime can
Speaker 9: swiftly give way to more conflicts and chaos, how the
Speaker 9: shoes of one dictator can be filled by another. Well,
Speaker 9: now interference by an outside country can be thrown off
Speaker 9: only to be replaced by another. That's why it's so
Speaker 9: important that we and our partners came together today to
Speaker 9: agree on principles that will guide our efforts to help
Speaker 9: the Syrian people meet these challenges and build the inclusive,
Speaker 9: non sectarian, peaceful and sovereign state that they want. Our
Speaker 9: message to the Syrian people is this, we want them
Speaker 9: to succeed, and we're prepared to help them do so.
Speaker 2: For more, I want to turn now. Tamara Rudman, who
Speaker 2: is professor at the Miller Center at the University of Virginia,
Speaker 2: also director of the Ripples of Hope project focused on
Speaker 2: democratic solutions, and formerly Deputy Envoy for Middle East Peace
Speaker 2: at the US Department of State. Welcome back to Bloomberg.
Speaker 4: Mara.
Speaker 3: Always good to have you. As the Secretary talks.
Speaker 2: About wanting the Syrian people to succeed, is that success
Speaker 2: going to be reliant on assuming that HTS, at least
Speaker 2: in some interim period is in power the US removing
Speaker 2: HTS is terrorist designation or terror organization designation rather.
Speaker 5: It's a good question, and it's good to be here.
Speaker 5: I think it's hard to say, though, it's hard to
Speaker 5: answer directly in terms of how that terrorism designation will
Speaker 5: get removed. What's the ability to interact with HTS absent
Speaker 5: that and with a real awareness of the number of
Speaker 5: different groups and factions and centers of power within Syria
Speaker 5: right now it's not just HTS, and there's a question
Speaker 5: of making some tough choices among bad options, and doing
Speaker 5: it at a time of transition in this country and
Speaker 5: a number of other key countries as well, in terms
Speaker 5: of leadership transitions ongoing.
Speaker 2: Obviously it's still early days, but to this point, the transition,
Speaker 2: the management that we've seen from HTS of it, Mara,
Speaker 2: how would you rate it? It does seem by and large,
Speaker 2: things have been pretty peaceful and orderly so far.
Speaker 5: I think that's a fair characterization. These things can often
Speaker 5: go bad quickly, but at least from public perceptions, HTS
Speaker 5: is taking is making a significant effort to first show
Speaker 5: their strength in being able to govern Damascus and the
Speaker 5: environs again number of other groups. It's important for them
Speaker 5: internally to show they're in control. They've also thus far
Speaker 5: it seem to have been fairly relaxed about how women
Speaker 5: appear and interactance here, and you can see it on
Speaker 5: the news reports. There's a wide range of degrees of
Speaker 5: covern by women from completely uncovered to you know, fully
Speaker 5: fully so, and that the traditional extreme Islamist groups would
Speaker 5: expect and require women to be fully covered. And there's
Speaker 5: not been looting, there's not been some of the actions
Speaker 5: we've seen in other places when despicable leader like Assad
Speaker 5: has left and there's a certain amount of chaos, And
Speaker 5: as you point out, they seem to have managed to
Speaker 5: maintain a certain amount of order, have been sending the
Speaker 5: right public messages internationally, but have a record that is
Speaker 5: worth some wariness from outsiders and from those inside Syria.
Speaker 2: Well, especially when you consider their historic relationship to al Qaeda.
Speaker 2: It does speak to the broader concerns the US has
Speaker 2: not just to making sure there is you know, security
Speaker 2: for the Syrian people who have been living under Assad
Speaker 2: and the Assad families regime for decades now, but also
Speaker 2: this notion that they have been trying to keep Isis
Speaker 2: the Islamic state at bay and there is concern about
Speaker 2: a potential resurgence. What is your degree of concern around that, Mara,
Speaker 2: that we could see a kind of reigniting of this
Speaker 2: group's power and ability.
Speaker 5: My concern is high. Isis has not gone away, nor
Speaker 5: has al Qaeda. And what I was referencing earlier in
Speaker 5: terms of Syria being a country of faction, of different
Speaker 5: communities and different spheres of power is even more the case.
Speaker 5: It was the case when Assad was ruling in He
Speaker 5: kept control, he and his father both in a fairly
Speaker 5: brutal way. I shouldn't have said fairly brutal, in a
Speaker 5: brutal and despicable way. But those factions are still are
Speaker 5: not only there, but have the potential to gain a
Speaker 5: tremendous amount of power work in coalition with each other.
Speaker 5: HTS was formerly a group called Al Lustra, which is
Speaker 5: I believe where their terrorist designation came, and as you
Speaker 5: point out, they were on offshoot of al Qaeda. They
Speaker 5: were a group that kept hostages, including American hostages, during
Speaker 5: the ISIS regime and time period. So a lot of
Speaker 5: reason for awareness and concern and a real effort, and
Speaker 5: I think you saw it in what Secretaric Lincoln said
Speaker 5: this weekend of trying to figure out how you get
Speaker 5: coalitions of like minded countries together around things like principles
Speaker 5: to advance, and particularly when as I said, the States
Speaker 5: is going through a transition, Germany a pairents will be
Speaker 5: going through transition France as a new prime minister, and
Speaker 5: Macron has his challenges there. So we're really going to
Speaker 5: have to work very closely with countries in the region
Speaker 5: to figure out how we put together these more solid coalitions.
Speaker 2: We're just getting some breaking news Mara from the Times
Speaker 2: of London, which is reporting citing an interview with Muhammad
Speaker 2: Abu Muhammad al Julani, who of course is the leader
Speaker 2: here of HTS, who told the Times that he would
Speaker 2: not allow Siria to be used as a launchpad for
Speaker 2: attacks against Israel or any other state. And I feel
Speaker 2: like this does in some way speak to the role
Speaker 2: Iron will or will not be able to play under
Speaker 2: this new regimes, considering the alliance they had with Asad.
Speaker 3: What is your reaction to that?
Speaker 2: What is that signal about the way in which the
Speaker 2: new transitional government will be approaching Israel specifically?
Speaker 5: Thanks well, I think I have two reactions. One is
Speaker 5: that it's consistent with what I referenced earlier about how
Speaker 5: the HTS leader Al Johanni is positioning himself and his leadership,
Speaker 5: so as not just these are the Israel and its concerns,
Speaker 5: but the kinds of coalition groups that Secretary Blincoln was
Speaker 5: speaking about, right of trying to assuage the United States
Speaker 5: and others as well in the region with those kinds
Speaker 5: of words. My second reaction, though, is that it's a
Speaker 5: fairly practical thing for him to say, because we know
Speaker 5: that part of how Assad fell so quickly in the
Speaker 5: end was because Iran's air defense capability, Iran's access points
Speaker 5: are severely limited. They could not go in.
Speaker 7: And and.
Speaker 5: What has Belah has done in the past and backing
Speaker 5: up Assad's forces in Srea, all of those things are gone,
Speaker 5: and Russia does not have the ability to provide air
Speaker 5: cover either, so it's a fairly low cost and very
Speaker 5: rational proposition for the HTS leader to put out what
Speaker 5: he's saying, because he also may not have the means
Speaker 5: to do anything other than that until he's getting credit
Speaker 5: internationally for putting out that position.
Speaker 3: It makes sense.
Speaker 2: Well, I guess it speaks as well to the way
Speaker 2: in which we've seen Iran through this and through the
Speaker 2: way in which Israel has been very successful in dismantling
Speaker 2: a lot of Hesbela's operation, and of course it's leadership
Speaker 2: we've seen Iran diminished in a lot of ways. Mara,
Speaker 2: and I wonder if you think that makes Iran less
Speaker 2: dangerous at least in the near term, or potentially more
Speaker 2: so if they feel cornered in some way.
Speaker 5: It can be both, and I don't mean to avoid
Speaker 5: your question, but on the why they'd be less dangerous
Speaker 5: is if what they conclude is because of their lack
Speaker 5: of because of the extent to which has law has
Speaker 5: been decimated, and iran Own air defense capabilities and others
Speaker 5: have other items have been decimated, that means they should
Speaker 5: turn more rigorously to some sort of negotiating a compromise
Speaker 5: track with a new Trump administration, with Israel with others,
Speaker 5: and that's the conclusion they take that that's the best
Speaker 5: way to preserve the regime. They can also go to
Speaker 5: the other extreme and say no, this means what they
Speaker 5: need to do is absolutely speed up their ability to
Speaker 5: develop and potentially deploy their nuclear weapon capability because they
Speaker 5: have no other option, because all of the other defenses
Speaker 5: that they put up as essentially no longer exist and
Speaker 5: it could go either way, which is why it's very
Speaker 5: important how President Biden handles his last days in office
Speaker 5: with them, and how the baton is carried over to
Speaker 5: President Trump and his team, and how carefully and seriously
Speaker 5: they evaluate what the options are going forward and what
Speaker 5: the different trajectories might be, and how they react, how
Speaker 5: they relate to Iran.
Speaker 4: Mara.
Speaker 2: In our final two minutes here, what is all this
Speaker 2: entire conversation around Syria, around Iran, around Hesbola in Lebanon
Speaker 2: and its proximity to Syria. How does all of it
Speaker 2: inform your view on what is likely to happen with
Speaker 2: a potential ceasefire between Israel and Hamas. Is it more
Speaker 2: likely because of all of this?
Speaker 5: I hope that that means it's more likely and certainly.
Speaker 5: I listened very closely to Jake Sullivan, the American National
Speaker 5: Security Advisors comments I believe in Israel when he was
Speaker 5: there most recently, and he's been on the kind of
Speaker 5: a been a series of meetings with the countries again
Speaker 5: working very closely and trying to get yet again to
Speaker 5: a ceasefire that gets the hostages home, that helps to
Speaker 5: get humanitarian assistants in, and develops a path forward for Gaza,
Speaker 5: I would say, for Gaza and the West Bank post Hamas.
Speaker 5: So I do think that Hamas is even more isolated
Speaker 5: than they had been previously by the most recent developments.
Speaker 5: My concern is how much the acting leadership of Hamas,
Speaker 5: which I believe is in the hands it's point of
Speaker 5: the brother of Yaya Sinmar, who was killed some weeks
Speaker 5: ago and who is every bit as diabolical as sinoar
Speaker 5: as Yaya Sinwar was. What their willingness is to ultimately
Speaker 5: deploy an exit strategy as opposed to continuing this to
Speaker 5: the absolute end, and the hostages are key in that.
Speaker 5: So I hope Jake Sullivan is really onto something. I
Speaker 5: hope that it's possible for a variety for reasons I
Speaker 5: can make an argument that it is prior to President
Speaker 5: Electromp coming into office, but I'm not as certain as
Speaker 5: I would like to be, all.
Speaker 2: Right, Mara Rudman at the University of Viginia's Miller Center,
Speaker 2: where she is a professor.
Speaker 3: Thank you so much for joining us.
Speaker 1: Thanks for listening to the Balance of Power podcast.
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