1 00:00:02,520 --> 00:00:10,119 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,119 --> 00:00:13,880 Speaker 1: Bloomberg Balance of Power podcast. Catch US Live weekdays at 3 00:00:13,920 --> 00:00:17,119 Speaker 1: noon and five pm Eastern on Apple, Cocklay and Android 4 00:00:17,160 --> 00:00:20,520 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 5 00:00:20,600 --> 00:00:24,240 Speaker 1: you get your podcasts, or watch US live on YouTube. 6 00:00:25,320 --> 00:00:27,400 Speaker 2: Only Tuesday and already we have a lot of tariff 7 00:00:27,400 --> 00:00:29,600 Speaker 2: news we're grappling with, and more tariff news we're expecting 8 00:00:29,640 --> 00:00:32,239 Speaker 2: over the course of the next week or so. As 9 00:00:32,240 --> 00:00:34,280 Speaker 2: it is at the end of this week, not even 10 00:00:34,360 --> 00:00:37,040 Speaker 2: August seventh, when the US is set to start collecting 11 00:00:37,320 --> 00:00:40,440 Speaker 2: higher levies on a number of trading partners after they 12 00:00:40,440 --> 00:00:43,640 Speaker 2: were told what TERI free on their exports would be 13 00:00:43,720 --> 00:00:46,560 Speaker 2: charged last Friday on August first. Then, of course there's 14 00:00:46,600 --> 00:00:49,760 Speaker 2: the August twelfth deadline that the current detent between the 15 00:00:49,880 --> 00:00:51,879 Speaker 2: US and China is set to expire at and in 16 00:00:51,920 --> 00:00:56,319 Speaker 2: the next week or so, timing to be determined here, 17 00:00:56,360 --> 00:00:59,360 Speaker 2: I suppose Joe, we're expecting we'll finally get the long 18 00:00:59,400 --> 00:01:03,720 Speaker 2: awaited hour of sectoral tariffs on tikey industry, semiconductors and 19 00:01:03,760 --> 00:01:04,679 Speaker 2: pharmaceutical She. 20 00:01:04,640 --> 00:01:06,000 Speaker 3: Did that all off the top of her head. 21 00:01:06,440 --> 00:01:08,080 Speaker 4: I was watching Yeah, it's a lot of dates to 22 00:01:08,120 --> 00:01:10,240 Speaker 4: be swimming through here, and it looks like the chips 23 00:01:10,240 --> 00:01:13,280 Speaker 4: could be coming at least the chip tariff semiconductors in 24 00:01:13,280 --> 00:01:16,080 Speaker 4: the next two or three weeks, next week or two, 25 00:01:16,160 --> 00:01:18,800 Speaker 4: based on the language we heard from President Trump this 26 00:01:18,880 --> 00:01:21,120 Speaker 4: morning in an interview on another network. It's where we 27 00:01:21,160 --> 00:01:23,760 Speaker 4: start our conversation with Laura Davison, who is with US 28 00:01:23,760 --> 00:01:27,119 Speaker 4: now our deputy bureau chief here in Washington. Laura's job 29 00:01:27,200 --> 00:01:28,960 Speaker 4: is of course to like, you know, cut through all 30 00:01:29,000 --> 00:01:30,600 Speaker 4: the noise and when you have a half an hour 31 00:01:30,720 --> 00:01:33,400 Speaker 4: long weave like that. Frankly, not a lot of news 32 00:01:33,400 --> 00:01:36,039 Speaker 4: in that conversation, but this one got our attention, and 33 00:01:36,080 --> 00:01:38,360 Speaker 4: it's something that investors have been waiting for. Was there 34 00:01:38,360 --> 00:01:40,600 Speaker 4: anything new when it came to chip tariffs? 35 00:01:40,640 --> 00:01:42,479 Speaker 3: Do we have a number? Do we have a more 36 00:01:42,520 --> 00:01:43,440 Speaker 3: exact timeline? 37 00:01:43,480 --> 00:01:45,800 Speaker 5: We don't other than it is a week or so. 38 00:01:45,959 --> 00:01:48,000 Speaker 5: In Trump world, that can mean a week or it 39 00:01:48,000 --> 00:01:52,120 Speaker 5: could mean months. But he's made several comments now in 40 00:01:52,200 --> 00:01:53,960 Speaker 5: recent weeks that you know, kind of by the end 41 00:01:54,000 --> 00:01:56,280 Speaker 5: of the month that this is sort of something that 42 00:01:56,920 --> 00:01:59,080 Speaker 5: the usgr US TRADERFF is getting close to. This is 43 00:01:59,080 --> 00:02:00,320 Speaker 5: one of one of those We're going to a little 44 00:02:00,320 --> 00:02:02,400 Speaker 5: nerd to here. The two thirty two tariffs. These are 45 00:02:02,400 --> 00:02:04,600 Speaker 5: the ones that are about a national emergency. These are 46 00:02:04,640 --> 00:02:06,600 Speaker 5: the ones that have staying power. This is the same 47 00:02:06,640 --> 00:02:09,080 Speaker 5: authority he used in his first term, So these are 48 00:02:09,120 --> 00:02:10,800 Speaker 5: not likely to get caught up in the courts. The 49 00:02:10,840 --> 00:02:13,480 Speaker 5: reciprocal tariffs, those tariffs that are on countries, those are 50 00:02:13,520 --> 00:02:14,880 Speaker 5: the ones that could get a little bit tricky. And 51 00:02:14,919 --> 00:02:17,320 Speaker 5: you're starting to see the White House think about, Okay, 52 00:02:17,320 --> 00:02:19,240 Speaker 5: if the courts come down and strike down some of these, 53 00:02:19,320 --> 00:02:21,919 Speaker 5: how do we implement our tariff strategy in a way 54 00:02:21,919 --> 00:02:24,200 Speaker 5: that the courts will uphold. That's going to be after 55 00:02:24,240 --> 00:02:26,600 Speaker 5: we get through this spate of dates of different deadlines 56 00:02:26,639 --> 00:02:28,400 Speaker 5: coming up. That's kind of the long term strategy of 57 00:02:28,440 --> 00:02:29,440 Speaker 5: what's going on at the White House. 58 00:02:29,560 --> 00:02:31,760 Speaker 2: Yeah, it's a good point that there's a massive legal 59 00:02:31,840 --> 00:02:36,320 Speaker 2: question around the use of the AIFA authority to implement 60 00:02:36,400 --> 00:02:39,680 Speaker 2: these kind of tariffs broadly on countries like for example, 61 00:02:39,760 --> 00:02:41,919 Speaker 2: Laura Switzerland, which of course last week learned it was 62 00:02:41,960 --> 00:02:44,160 Speaker 2: going to be paying a thirty nine percent tarif, or 63 00:02:44,200 --> 00:02:46,960 Speaker 2: rather that tariff would be charged on its exports to 64 00:02:47,200 --> 00:02:51,560 Speaker 2: the United States, surprising Switzerland to the extent that now 65 00:02:51,600 --> 00:02:54,560 Speaker 2: the Swiss president is rushing to DC to try to 66 00:02:55,760 --> 00:02:58,440 Speaker 2: get something of a better deal. Is this likely to 67 00:02:58,480 --> 00:02:58,919 Speaker 2: go anywhere? 68 00:02:59,040 --> 00:02:59,200 Speaker 6: Is it? 69 00:02:59,240 --> 00:03:01,800 Speaker 2: Thirty nine percent starting to be collected on the seventh, 70 00:03:01,840 --> 00:03:02,680 Speaker 2: just two days from now. 71 00:03:02,840 --> 00:03:05,160 Speaker 5: This is entirely up to Trump. The reason they are 72 00:03:05,160 --> 00:03:07,160 Speaker 5: at a thirty nine percent tariff is because of a 73 00:03:07,160 --> 00:03:10,000 Speaker 5: call that went badly with the Swiss president last week 74 00:03:10,040 --> 00:03:13,240 Speaker 5: ahead of that August first deadline, where they really were 75 00:03:13,240 --> 00:03:15,720 Speaker 5: talking about trade deficits, things that the president that US 76 00:03:15,800 --> 00:03:18,000 Speaker 5: President Trump did not want to hear at all. They're 77 00:03:18,040 --> 00:03:20,360 Speaker 5: trying to rectify that now. I anticipate the tone of 78 00:03:20,360 --> 00:03:22,440 Speaker 5: this conversation is going to be a lot different. But 79 00:03:22,480 --> 00:03:24,919 Speaker 5: will there be enough groveling for Trump to say, Okay, 80 00:03:24,960 --> 00:03:26,400 Speaker 5: we'll bring you down to more in line with other 81 00:03:26,440 --> 00:03:27,080 Speaker 5: EU nations. 82 00:03:27,200 --> 00:03:30,600 Speaker 4: Well, apparently they're showing up without an invitation? Is that correct? 83 00:03:30,639 --> 00:03:32,240 Speaker 4: From the White House? You just get on a plane 84 00:03:32,280 --> 00:03:34,480 Speaker 4: and hope for the best. Knock on the door. Will 85 00:03:34,480 --> 00:03:35,440 Speaker 4: the President let them in? 86 00:03:35,880 --> 00:03:37,960 Speaker 5: We will see this. This is really sort of a 87 00:03:38,040 --> 00:03:41,960 Speaker 5: high stakes negotiation. Trump, however, loves this. He loves when people, 88 00:03:42,280 --> 00:03:44,440 Speaker 5: you know, kind of come to him sort of you know, 89 00:03:44,760 --> 00:03:47,960 Speaker 5: our supplicants are asking for his forgiveness. You know, he 90 00:03:47,960 --> 00:03:50,840 Speaker 5: has a public event this afternoon. He's signing an executive order, 91 00:03:51,200 --> 00:03:52,520 Speaker 5: so we will may get a sense of where his 92 00:03:52,520 --> 00:03:54,280 Speaker 5: state of mind is on these negotiations in just a 93 00:03:54,280 --> 00:03:54,880 Speaker 5: couple hours. 94 00:03:55,040 --> 00:03:56,760 Speaker 2: And you know, the one thing I forgot to mention 95 00:03:56,840 --> 00:03:59,040 Speaker 2: that also falls within this week or so timeline is 96 00:03:59,080 --> 00:04:02,560 Speaker 2: come Friday, that's the deadline he gave Russia to agree 97 00:04:02,600 --> 00:04:05,880 Speaker 2: to a seasfire in Ukraine or else implement secondary tariffs 98 00:04:05,960 --> 00:04:08,760 Speaker 2: or secondary sanctions. I'm not sure we have full clarity, Laura, 99 00:04:08,760 --> 00:04:11,760 Speaker 2: as to what exactly he is willing to implement on 100 00:04:11,880 --> 00:04:13,920 Speaker 2: Friday if there is no agreement. Even as we learn 101 00:04:14,880 --> 00:04:18,320 Speaker 2: Russia is at least considering an air truce with Ukraine, 102 00:04:18,320 --> 00:04:19,560 Speaker 2: even if not a full seasfire. 103 00:04:19,640 --> 00:04:21,840 Speaker 5: And even before then, he said he would put more 104 00:04:21,839 --> 00:04:24,719 Speaker 5: tariffs on India within the next twenty four hours because 105 00:04:24,720 --> 00:04:27,000 Speaker 5: of their purchases of Russian oil. So you have all 106 00:04:27,040 --> 00:04:29,479 Speaker 5: of these, as Joe said, a weave of tariffs that's 107 00:04:29,480 --> 00:04:32,880 Speaker 5: coming together that makes it very difficult for markets to 108 00:04:32,920 --> 00:04:35,560 Speaker 5: figure out what's coming. These timelines are all subject to 109 00:04:35,560 --> 00:04:38,240 Speaker 5: Trump's whims and this is just a very very difficult moment, 110 00:04:38,480 --> 00:04:41,080 Speaker 5: and that's why we're seeing some of this economic data 111 00:04:41,080 --> 00:04:43,720 Speaker 5: come in lower than expected. Services were lower. We also saw, 112 00:04:43,920 --> 00:04:46,560 Speaker 5: of course, the very infamous now jobs report last week. 113 00:04:46,600 --> 00:04:51,680 Speaker 4: How much of this is purposeful in its confusion to 114 00:04:51,800 --> 00:04:56,480 Speaker 4: keep I guess our trading partners or maybe other countries 115 00:04:56,520 --> 00:04:59,520 Speaker 4: on their heels to some extent as opposed to changing 116 00:04:59,560 --> 00:05:02,120 Speaker 4: the subject from Jeffrey Epstein. And I bring that up 117 00:05:02,120 --> 00:05:04,520 Speaker 4: because there is news today that the House Republicans have 118 00:05:04,560 --> 00:05:08,640 Speaker 4: subpoenaed the DOJ, along with former President Clinton, a former 119 00:05:08,680 --> 00:05:14,120 Speaker 4: Secretary of State Hillary Clinton, an unredacted complete Epstein files. 120 00:05:14,160 --> 00:05:15,520 Speaker 4: I don't know if you see that happening by the 121 00:05:15,600 --> 00:05:18,440 Speaker 4: deadline on August nineteenth, but this is obviously something that 122 00:05:18,480 --> 00:05:20,360 Speaker 4: the White House does not want us to be talking about. 123 00:05:20,480 --> 00:05:22,160 Speaker 5: There's really two tracks here for the White House. One 124 00:05:22,200 --> 00:05:24,719 Speaker 5: it helps to distract from Epstein, and clearly Republicans on 125 00:05:24,720 --> 00:05:26,480 Speaker 5: the Hill they're not even in town, but they're still 126 00:05:26,480 --> 00:05:29,120 Speaker 5: working on this Epstein issue. I think what we saw 127 00:05:29,200 --> 00:05:32,200 Speaker 5: yesterday in terms of the Justice Department also announcing they 128 00:05:32,200 --> 00:05:35,479 Speaker 5: were going to investigate the Russiagate scenario going back and 129 00:05:35,520 --> 00:05:39,400 Speaker 5: investigate Obama era officials over the Russia's involvement in the 130 00:05:39,400 --> 00:05:42,720 Speaker 5: twenty sixteen election. This is kind of a multi prong 131 00:05:42,760 --> 00:05:47,760 Speaker 5: strategy from the Trump administration to distract and pivot the narrative. Also, 132 00:05:47,839 --> 00:05:49,719 Speaker 5: it's important to remember that they just also don't have 133 00:05:49,720 --> 00:05:51,599 Speaker 5: a lot of these deals negotiated. They haven't made up 134 00:05:51,600 --> 00:05:54,040 Speaker 5: their mind, they haven't finished the investigations, and that they've 135 00:05:54,040 --> 00:05:57,680 Speaker 5: been doing tariffs on dozens of different fronts. And Trump 136 00:05:57,760 --> 00:05:59,560 Speaker 5: likes to leave these things to the very last minute 137 00:05:59,560 --> 00:06:01,240 Speaker 5: and make up was mine only when he has to. 138 00:06:01,800 --> 00:06:05,320 Speaker 2: All right, Laura Davison, our deputy beer chief here in Washington, 139 00:06:05,360 --> 00:06:08,080 Speaker 2: d C, thank you so much for joining us now 140 00:06:08,080 --> 00:06:10,320 Speaker 2: as we consider the President making up his mind or 141 00:06:10,320 --> 00:06:13,440 Speaker 2: not on tariffs of all different shapes and sizes. We 142 00:06:13,480 --> 00:06:15,560 Speaker 2: turned out of Sarah Bianki, who of course served as 143 00:06:15,800 --> 00:06:18,960 Speaker 2: a deputy US Trade Representative during the Biden administration. She's 144 00:06:19,000 --> 00:06:21,839 Speaker 2: now senior managing director and chief strategist of International Political 145 00:06:21,880 --> 00:06:26,240 Speaker 2: Affairs and Public Policy at Evercore ISSI. Sarah, welcome back 146 00:06:26,279 --> 00:06:28,760 Speaker 2: to Bloomberg TV and Radio. If we could just begin 147 00:06:28,920 --> 00:06:31,480 Speaker 2: with what was a very big number put out by 148 00:06:31,480 --> 00:06:34,400 Speaker 2: the President today, the suggestion that tariff's on pharmaceuticals when 149 00:06:34,400 --> 00:06:37,080 Speaker 2: and if they are announced, could ultimately go as high 150 00:06:37,120 --> 00:06:39,919 Speaker 2: as two hundred and fifty percent, just not immediately to 151 00:06:40,000 --> 00:06:44,760 Speaker 2: allow for some more on shoring of that industry here 152 00:06:44,800 --> 00:06:47,000 Speaker 2: in the United States. How long of a window do 153 00:06:47,040 --> 00:06:49,480 Speaker 2: you really need to leave to allow that kind of 154 00:06:49,520 --> 00:06:53,200 Speaker 2: supply chain reorientation to happen. Will two hundred and fifty 155 00:06:53,200 --> 00:06:56,000 Speaker 2: percent tariffs the threat of it actually make a difference 156 00:06:56,080 --> 00:06:59,560 Speaker 2: on say, things like drug prices that American people are 157 00:06:59,600 --> 00:07:00,640 Speaker 2: faced with at the pharmacy. 158 00:07:02,120 --> 00:07:04,920 Speaker 7: Well, two fifty is certainly a very very big number. 159 00:07:05,400 --> 00:07:10,200 Speaker 7: And it's particularly interesting because in the EU Agreement, the 160 00:07:10,240 --> 00:07:14,760 Speaker 7: EU sends the United States a lot of the drugs 161 00:07:14,760 --> 00:07:19,520 Speaker 7: that we get. They were given a fifteen percent from 162 00:07:19,560 --> 00:07:24,119 Speaker 7: the President on pharma, So a lot of confusion about 163 00:07:24,160 --> 00:07:29,280 Speaker 7: exactly what the President is solving for Relocating a manufacturing 164 00:07:29,360 --> 00:07:33,960 Speaker 7: facility or building one of the United States is very 165 00:07:34,120 --> 00:07:38,600 Speaker 7: very time consuming and expensive. You need to get FDA approval, 166 00:07:38,680 --> 00:07:42,720 Speaker 7: among other things. I think it'll be interesting to see 167 00:07:42,760 --> 00:07:46,760 Speaker 7: what part of the drug chain supply chain is the 168 00:07:46,840 --> 00:07:49,000 Speaker 7: President looking for. There's all the way down from the 169 00:07:49,160 --> 00:07:53,880 Speaker 7: very basic inputs like API to generic drugs. Many of 170 00:07:53,880 --> 00:07:56,520 Speaker 7: those come from India to more some of the more 171 00:07:56,520 --> 00:07:58,920 Speaker 7: advanced drugs from the EU. So I think we have 172 00:07:58,960 --> 00:08:02,040 Speaker 7: a lot to learn from the President about exactly what 173 00:08:02,200 --> 00:08:03,640 Speaker 7: he is seeking to achieve here. 174 00:08:04,600 --> 00:08:08,720 Speaker 4: Interesting we're talking about, to your point two very specialized industries, 175 00:08:09,680 --> 00:08:12,400 Speaker 4: and you've already expressed that when it comes to pharma, 176 00:08:12,480 --> 00:08:14,760 Speaker 4: when you talk about chips as well, it takes a 177 00:08:15,040 --> 00:08:18,560 Speaker 4: very long time to build a chip foundry, and there 178 00:08:18,600 --> 00:08:21,400 Speaker 4: seems to be an expectation in the White House that 179 00:08:21,480 --> 00:08:24,440 Speaker 4: these things can happen, including auto manufacturing back in the 180 00:08:24,520 --> 00:08:27,440 Speaker 4: US very quickly. You throw a switch and we're making 181 00:08:27,480 --> 00:08:30,040 Speaker 4: iPhones here in the United States. What would be more 182 00:08:30,080 --> 00:08:34,040 Speaker 4: difficult to re sure chips or pharmaceuticals. 183 00:08:35,760 --> 00:08:41,200 Speaker 7: Well, they're both very, very very challenging. Chips may be 184 00:08:41,240 --> 00:08:46,160 Speaker 7: even more complex, but they're both very very difficult and 185 00:08:46,280 --> 00:08:50,240 Speaker 7: not totally clear that there will be a cost advantage 186 00:08:50,320 --> 00:08:54,040 Speaker 7: of doing that. I think with the chips investigation, really 187 00:08:54,080 --> 00:08:58,360 Speaker 7: what I'm looking for is how much is the President 188 00:08:58,400 --> 00:09:01,640 Speaker 7: looking to just tear or if the chips themselves that 189 00:09:01,720 --> 00:09:05,560 Speaker 7: come in that's more in the fifty a billion dollar range, 190 00:09:06,040 --> 00:09:08,920 Speaker 7: or how wide is he willing to go with products 191 00:09:08,920 --> 00:09:11,400 Speaker 7: that have chips in them? In that case, you can 192 00:09:11,440 --> 00:09:15,520 Speaker 7: get to about three hundred billion of imports. So what 193 00:09:15,600 --> 00:09:18,160 Speaker 7: I'm really looking for on the chips is to see 194 00:09:18,720 --> 00:09:22,120 Speaker 7: how much of the derivative products is he looking for. 195 00:09:23,240 --> 00:09:27,079 Speaker 7: If not, again, you might find that what the teriffs 196 00:09:27,320 --> 00:09:32,840 Speaker 7: encourage is countries to send chips to other places first 197 00:09:32,920 --> 00:09:35,280 Speaker 7: and have them embedded in a product and then come 198 00:09:35,320 --> 00:09:38,800 Speaker 7: to the US. So how these tariffs are designed makes 199 00:09:38,840 --> 00:09:41,199 Speaker 7: a big difference in how the industry responds. 200 00:09:42,880 --> 00:09:43,120 Speaker 6: Well. 201 00:09:43,160 --> 00:09:46,320 Speaker 2: As you talk about chips being embedded in other products, 202 00:09:46,440 --> 00:09:49,560 Speaker 2: it reminds me of the idea of where things are originating, 203 00:09:49,600 --> 00:09:52,280 Speaker 2: in what form, or from where they ultimately come to 204 00:09:52,400 --> 00:09:55,120 Speaker 2: the United States. Knowing Sarah, part of what is said 205 00:09:55,160 --> 00:09:57,840 Speaker 2: to be collected beginning August seventh, there is also a 206 00:09:57,880 --> 00:10:01,760 Speaker 2: forty percent tariff on trans shipped goods. That we've lacked 207 00:10:01,800 --> 00:10:04,319 Speaker 2: a great deal of clarity as to how exactly those 208 00:10:04,400 --> 00:10:07,880 Speaker 2: rules would be designed, how they would be tracked and implemented. 209 00:10:07,880 --> 00:10:10,360 Speaker 2: What is your expectation. How difficult is it actually to 210 00:10:10,440 --> 00:10:14,400 Speaker 2: get accurate transhipment information and charge levy accordingly. 211 00:10:15,160 --> 00:10:17,520 Speaker 7: Well, you have to It's very difficult. What you have 212 00:10:17,679 --> 00:10:20,160 Speaker 7: to first do is decide, again, what are you trying 213 00:10:20,200 --> 00:10:23,800 Speaker 7: to solve for There are some areas where I think 214 00:10:23,840 --> 00:10:28,040 Speaker 7: there's just abuses now where things come safe from China 215 00:10:28,080 --> 00:10:32,400 Speaker 7: and they really aren't transformed much in another country and 216 00:10:32,440 --> 00:10:35,760 Speaker 7: then they make it on their way to the United States. 217 00:10:36,080 --> 00:10:39,520 Speaker 7: That kind of crackdown is really just working, is just 218 00:10:39,640 --> 00:10:45,000 Speaker 7: more of a customs enforcement thing than anything else. But alternatively, 219 00:10:45,080 --> 00:10:48,000 Speaker 7: the president could be looking for something like a what 220 00:10:48,160 --> 00:10:52,680 Speaker 7: about a Chinese factory that's fully built in Vietnam in Mexico. 221 00:10:52,800 --> 00:10:57,800 Speaker 7: This is something that the Biden administration looked at around 222 00:10:57,840 --> 00:11:01,240 Speaker 7: steel we started to see more steel, Chinese steel coming 223 00:11:01,240 --> 00:11:04,000 Speaker 7: in through Mexico. Or are you trying to solve for buid? 224 00:11:04,440 --> 00:11:08,040 Speaker 7: You really have to define here what problem am I 225 00:11:08,080 --> 00:11:11,840 Speaker 7: solving for? Am I literally talking about any Chinese ownership? 226 00:11:12,880 --> 00:11:16,400 Speaker 7: And then design your policy accordingly? And trendshipment is one 227 00:11:16,480 --> 00:11:20,640 Speaker 7: where the definitions could certainly run the gamut. 228 00:11:21,760 --> 00:11:24,400 Speaker 4: Interesting data today as we find the US trade deficit 229 00:11:24,480 --> 00:11:28,600 Speaker 4: narrowed in June to the tightest since September of twenty 230 00:11:28,760 --> 00:11:32,760 Speaker 4: twenty three. It is happening a trade gap down sixteen 231 00:11:32,800 --> 00:11:36,080 Speaker 4: percent from the prior month to just over sixty billion dollars, 232 00:11:36,120 --> 00:11:39,439 Speaker 4: lower than expected to what extent, will this trend continue? 233 00:11:41,679 --> 00:11:45,240 Speaker 7: Well, certainly, you know, if you teariff things at very 234 00:11:45,320 --> 00:11:49,480 Speaker 7: high rates, you do get less of them. And particularly 235 00:11:49,559 --> 00:11:52,360 Speaker 7: while we've had remember over this period, we've had a 236 00:11:52,400 --> 00:11:56,760 Speaker 7: lot of different policies in place, and we had some 237 00:11:57,280 --> 00:11:59,960 Speaker 7: a pre ordering that happened in advance of the month 238 00:12:00,080 --> 00:12:02,640 Speaker 7: that could be so I would say I'd want to 239 00:12:02,679 --> 00:12:05,160 Speaker 7: see the data for a few more months to see 240 00:12:05,200 --> 00:12:07,120 Speaker 7: if we can cut out some of the noise as 241 00:12:07,120 --> 00:12:11,440 Speaker 7: the policy has adjusted. But in general, yeah, we should 242 00:12:11,520 --> 00:12:15,880 Speaker 7: see the trade deficit down. That's obviously a metric that 243 00:12:15,960 --> 00:12:21,000 Speaker 7: this administration cares a lot about. You know, there's a 244 00:12:21,000 --> 00:12:23,040 Speaker 7: lot of other metrics that are relevant as well, but 245 00:12:23,640 --> 00:12:26,920 Speaker 7: on this one, sure, the trade deficit should marginally come down. 246 00:12:28,080 --> 00:12:31,000 Speaker 2: Well, and we know that deficits in many ways factor 247 00:12:31,040 --> 00:12:34,120 Speaker 2: into the calculations the administration has made when setting tariff 248 00:12:34,200 --> 00:12:38,040 Speaker 2: rates on individual countries, Sarah, to what extent should we 249 00:12:38,080 --> 00:12:42,280 Speaker 2: expect a dramatic reduction in those actual structural deficits or 250 00:12:42,400 --> 00:12:45,280 Speaker 2: surplus is depending obviously on what country we're talking about. 251 00:12:45,280 --> 00:12:47,920 Speaker 2: But is this an achievable aim to try to bring 252 00:12:47,960 --> 00:12:50,080 Speaker 2: all of those down substantially? 253 00:12:52,120 --> 00:12:55,040 Speaker 7: It really depends. I mean you know, one of the 254 00:12:55,080 --> 00:12:57,679 Speaker 7: reasons we a lot of people don't just look at 255 00:12:57,679 --> 00:13:01,079 Speaker 7: trade deficits across the board as a meaningful metric, even 256 00:13:01,120 --> 00:13:04,040 Speaker 7: though this administration takes them quite seriously, is it can 257 00:13:04,080 --> 00:13:06,959 Speaker 7: tell you a lot of different things about what's going on. So, 258 00:13:07,000 --> 00:13:09,960 Speaker 7: for example, in from Canada, we get a lot of 259 00:13:10,080 --> 00:13:14,160 Speaker 7: energy in the United States pretty cost effective. That's one 260 00:13:14,200 --> 00:13:17,480 Speaker 7: that's been exempted from some of the tariffs, So that 261 00:13:17,600 --> 00:13:21,960 Speaker 7: deficit should persist. I think that's probably good for both economies. 262 00:13:22,840 --> 00:13:26,199 Speaker 7: In other places where you were talking about, you know, 263 00:13:27,080 --> 00:13:30,559 Speaker 7: the Swiss, Sure they're going to send a lot more. 264 00:13:32,920 --> 00:13:33,120 Speaker 6: Thing. 265 00:13:33,360 --> 00:13:36,480 Speaker 7: So it really depends on the country. It depends what 266 00:13:36,600 --> 00:13:42,920 Speaker 7: composition of their exports to the US are sectoral. But 267 00:13:43,080 --> 00:13:47,640 Speaker 7: certainly places that can are looking to divert to other 268 00:13:47,760 --> 00:13:51,400 Speaker 7: markets to the degree that there's demand, because this is 269 00:13:51,440 --> 00:13:54,880 Speaker 7: an expensive way to go. So it may not be 270 00:13:55,040 --> 00:13:59,400 Speaker 7: that the United States isn't necessarily exporting anymore to that country, 271 00:13:59,440 --> 00:14:02,199 Speaker 7: but rather they're just sending of their goods elsewhere. 272 00:14:03,080 --> 00:14:06,320 Speaker 4: Sure, sorry, Sarah, we were talking earlier about the deadline 273 00:14:06,320 --> 00:14:07,920 Speaker 4: at the end of the week that the President has 274 00:14:07,960 --> 00:14:11,959 Speaker 4: put on Russia for secondary sanctions, which sometimes he refers 275 00:14:12,000 --> 00:14:15,080 Speaker 4: to as tariffs. If that in fact happens, does that 276 00:14:15,160 --> 00:14:18,480 Speaker 4: jeopardize our potential to make a trade deal with China 277 00:14:18,640 --> 00:14:22,680 Speaker 4: or does it hasten an opportunity. 278 00:14:23,600 --> 00:14:26,760 Speaker 7: Well, I think there's a lot riding on the trade 279 00:14:26,760 --> 00:14:30,080 Speaker 7: deal with China, and the administration does seem quite nervous 280 00:14:30,120 --> 00:14:36,000 Speaker 7: about the potential for China to take additional action or 281 00:14:36,120 --> 00:14:37,920 Speaker 7: or revert to some of the action we've seen on 282 00:14:38,040 --> 00:14:40,200 Speaker 7: rare Earth. So I think they're going to try to 283 00:14:40,200 --> 00:14:46,560 Speaker 7: not really disrupt that negotiation going into August twelfth, So 284 00:14:46,600 --> 00:14:49,600 Speaker 7: we'll see what he does on this oil front. It 285 00:14:49,600 --> 00:14:53,920 Speaker 7: shouldn't be a huge but I don't think he's looking 286 00:14:53,960 --> 00:14:59,760 Speaker 7: to escalate with China. Certainly, it's also an issue with India, 287 00:14:59,800 --> 00:15:02,360 Speaker 7: where he's been trying to land a deal that's gone 288 00:15:02,400 --> 00:15:06,880 Speaker 7: a bit sideways of late, so certainly impacts if he 289 00:15:06,960 --> 00:15:10,080 Speaker 7: goes there. But again, my expectation is that the administration 290 00:15:10,240 --> 00:15:15,600 Speaker 7: is looking to keep China from not escalating at this point, 291 00:15:15,960 --> 00:15:20,960 Speaker 7: and my base case is they'll do policies supportingly. 292 00:15:22,440 --> 00:15:25,800 Speaker 4: It's great to have you back as always, Sarah evercore Isi, 293 00:15:26,040 --> 00:15:30,040 Speaker 4: Sarah Bianki, we appreciate the insights our panels Up next 294 00:15:30,080 --> 00:15:31,400 Speaker 4: here on Bloomberg. 295 00:15:33,120 --> 00:15:36,600 Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch 296 00:15:36,680 --> 00:15:39,760 Speaker 1: us live weekdays at noon and five pm Eastern on 297 00:15:39,840 --> 00:15:43,080 Speaker 1: Apple Cockley and Android Auto with the Bloomberg Business App. 298 00:15:43,120 --> 00:15:46,160 Speaker 1: You can also listen live on Amazon Alexa from our 299 00:15:46,160 --> 00:15:51,400 Speaker 1: flagship New York station Just Say Alexa played Bloomberg eleven thirty. 300 00:15:52,360 --> 00:15:55,560 Speaker 2: Town is a whole lot less crowded as it is August, 301 00:15:55,680 --> 00:15:58,800 Speaker 2: which means Congress is on recess. Both the Senate and 302 00:15:58,840 --> 00:16:02,440 Speaker 2: the House are either traveling on codels or home in 303 00:16:02,520 --> 00:16:05,960 Speaker 2: their districts talking to their constituents. And in the case 304 00:16:06,000 --> 00:16:09,440 Speaker 2: of several Republican lawmakers who have decided to hold town 305 00:16:09,480 --> 00:16:13,560 Speaker 2: halls with their constituents in recent days, it hasn't necessarily 306 00:16:14,520 --> 00:16:17,800 Speaker 2: gone incredibly well as they try to tout what they 307 00:16:17,840 --> 00:16:20,200 Speaker 2: see as the positives of the one big, beautiful bill 308 00:16:20,240 --> 00:16:23,640 Speaker 2: that they all just voted for, and those gathered at 309 00:16:23,640 --> 00:16:26,280 Speaker 2: the town halls seemed to see it in a very 310 00:16:26,280 --> 00:16:28,560 Speaker 2: different light. We saw the most recent evidence of this 311 00:16:28,760 --> 00:16:35,880 Speaker 2: yesterday when Republican Congressman Flood of Nebraska held a town hall. 312 00:16:35,920 --> 00:16:38,880 Speaker 2: He's actually the vice chair of the Republican Main Street Caucus. 313 00:16:38,920 --> 00:16:42,200 Speaker 2: He's been on this program several times Mike Flood faced 314 00:16:42,200 --> 00:16:46,440 Speaker 2: down some seven hundred individuals at a town hall, and 315 00:16:46,520 --> 00:16:48,960 Speaker 2: let's just get a taste of the reception he got. 316 00:16:51,720 --> 00:16:54,680 Speaker 3: We've heard this, sat, We've got Medicare. 317 00:16:54,800 --> 00:16:59,440 Speaker 8: Now we can start rolling back behaves five ten years 318 00:16:59,480 --> 00:16:59,960 Speaker 8: at a time. 319 00:17:00,200 --> 00:17:03,440 Speaker 3: Would you support that? We can't afford that. 320 00:17:03,520 --> 00:17:08,119 Speaker 9: Why did you cut snap and healthcare research? 321 00:17:08,840 --> 00:17:11,560 Speaker 3: We do not have unllimited money in the United States. 322 00:17:14,440 --> 00:17:18,960 Speaker 4: Lincoln, Nebraska, a room that erupted in chants of tax 323 00:17:19,119 --> 00:17:19,639 Speaker 4: the rich. 324 00:17:20,480 --> 00:17:22,280 Speaker 3: This, of course, Kaylee, follows our. 325 00:17:22,200 --> 00:17:25,480 Speaker 4: Conversation right around this time yesterday with Congressman Brian's Style 326 00:17:25,560 --> 00:17:29,240 Speaker 4: Republican from Wisconsin had a similar experience, although to see 327 00:17:29,440 --> 00:17:31,399 Speaker 4: hundreds of people line up around the block in this 328 00:17:31,520 --> 00:17:34,440 Speaker 4: case for a Mike Flood town hall says a lot 329 00:17:34,480 --> 00:17:36,440 Speaker 4: about where we are, and it's where we start today 330 00:17:36,760 --> 00:17:39,520 Speaker 4: with our political panel here on Balance of Power. Bloomberg 331 00:17:39,560 --> 00:17:44,080 Speaker 4: Politics contributors Rick Davis and Jeanie Shanzano are with us. Genie, 332 00:17:44,080 --> 00:17:46,600 Speaker 4: of course, is Senior Democracy Fellow with the Center for 333 00:17:46,640 --> 00:17:49,240 Speaker 4: the Study of the Presidency in Congress. Rick is partner 334 00:17:49,480 --> 00:17:52,080 Speaker 4: at Stone Court Capital. You know what they're saying, Genie 335 00:17:52,119 --> 00:17:55,040 Speaker 4: and it's happened at a couple of these that Democrats 336 00:17:55,080 --> 00:17:57,680 Speaker 4: packed the room with activists, some people not even from 337 00:17:57,720 --> 00:18:00,679 Speaker 4: the district, to make trouble for somebody like Mike Flood, who, 338 00:18:00,720 --> 00:18:03,119 Speaker 4: by the way, is considered a pretty moderate Republican. And 339 00:18:03,160 --> 00:18:05,040 Speaker 4: the grand scheme here in the House is that what's 340 00:18:05,040 --> 00:18:07,640 Speaker 4: going on, that is. 341 00:18:07,680 --> 00:18:09,439 Speaker 9: Part of it. I mean, if we look at the 342 00:18:09,520 --> 00:18:13,480 Speaker 9: spending numbers, the DNC has already put together and activated 343 00:18:13,480 --> 00:18:17,440 Speaker 9: a campaign on these very issues. They are flooding the airwaves, 344 00:18:17,560 --> 00:18:22,600 Speaker 9: online advertisements, billboards, and certainly getting people out to the 345 00:18:22,840 --> 00:18:25,760 Speaker 9: very few town halls that are being held. By one count, 346 00:18:25,800 --> 00:18:30,040 Speaker 9: only one or two of the thirty five vulnerable Republicans 347 00:18:30,080 --> 00:18:32,719 Speaker 9: has held a town hall. So have to give credit 348 00:18:32,800 --> 00:18:37,000 Speaker 9: to Brian Style, Mike Flood, the ones that are willing 349 00:18:37,080 --> 00:18:40,320 Speaker 9: to hold these town halls. But the reality is that 350 00:18:40,359 --> 00:18:45,320 Speaker 9: can't account for all of the energy and frustration that 351 00:18:45,359 --> 00:18:47,879 Speaker 9: we're hearing at those town halls. It can't be accounted 352 00:18:47,880 --> 00:18:52,080 Speaker 9: for by Democrats alone. And Republicans have to get on 353 00:18:52,280 --> 00:18:55,000 Speaker 9: message if they want to fight this. And one big 354 00:18:55,080 --> 00:18:57,480 Speaker 9: problem they have is, you know who hasn't been out 355 00:18:57,520 --> 00:19:01,040 Speaker 9: defending this. Donald Trump said on Meet the press, it 356 00:19:01,080 --> 00:19:04,600 Speaker 9: was so wildly popular that he didn't need to. But 357 00:19:04,720 --> 00:19:07,520 Speaker 9: the polls say something different, And of course we heard 358 00:19:07,600 --> 00:19:11,560 Speaker 9: it in Floodstown Hall yesterday. The people on the ground, 359 00:19:11,600 --> 00:19:13,640 Speaker 9: at least in certain parts of the country don't think 360 00:19:13,640 --> 00:19:15,280 Speaker 9: it's quite as popular as the president. 361 00:19:17,359 --> 00:19:20,600 Speaker 2: Well, when we consider Republicans trying to get their messaging out, Rick, 362 00:19:20,680 --> 00:19:23,400 Speaker 2: it does seem that both the lawmakers were talking about 363 00:19:23,400 --> 00:19:27,200 Speaker 2: in this instance instance, did come prepared with the messages 364 00:19:27,560 --> 00:19:29,640 Speaker 2: that they wanted to be able to send to these 365 00:19:29,720 --> 00:19:33,840 Speaker 2: individuals to defend the various elements of this bill. Hard 366 00:19:33,880 --> 00:19:35,760 Speaker 2: to do so, though, when you're being drowned out by 367 00:19:35,760 --> 00:19:40,520 Speaker 2: booze and shouts. Is this productive? Yes, give credit to 368 00:19:41,240 --> 00:19:44,119 Speaker 2: members who are actually getting out there and doing the 369 00:19:44,119 --> 00:19:46,840 Speaker 2: FaceTime thing, but is it getting them anywhere at all? 370 00:19:48,600 --> 00:19:51,760 Speaker 10: Yeah, As someone who has attended literally thousands of town 371 00:19:51,800 --> 00:19:55,520 Speaker 10: halls throughout the years, sadly it was one of John 372 00:19:55,560 --> 00:20:01,159 Speaker 10: McCain's favorite modes of communication. Off some steam is a 373 00:20:01,200 --> 00:20:03,320 Speaker 10: good thing from time to time, right, I mean, like 374 00:20:03,400 --> 00:20:07,600 Speaker 10: part of what happens at these is your constituencies have 375 00:20:07,680 --> 00:20:11,040 Speaker 10: a chance to sort of voice their own opinion in 376 00:20:11,680 --> 00:20:15,000 Speaker 10: addition to you out there selling what you've just done, 377 00:20:15,760 --> 00:20:19,240 Speaker 10: and so yeah, I mean I think that all in all, 378 00:20:19,560 --> 00:20:22,720 Speaker 10: there's no such thing as a bad town hall. If 379 00:20:23,119 --> 00:20:25,040 Speaker 10: the opposition wants to come and crowd it in there 380 00:20:25,040 --> 00:20:28,120 Speaker 10: and disrupt it, your own voters sit there and look 381 00:20:28,119 --> 00:20:30,040 Speaker 10: at that and say, gee that they're being unfair to 382 00:20:30,720 --> 00:20:34,240 Speaker 10: Brian Styles or you know, Mike Flood. But at the 383 00:20:34,320 --> 00:20:36,040 Speaker 10: end of the day, what you really care about are 384 00:20:36,080 --> 00:20:38,680 Speaker 10: those voters who are more likely to vote for you, 385 00:20:38,840 --> 00:20:41,399 Speaker 10: and that you have a chance to convey that. And 386 00:20:41,440 --> 00:20:44,240 Speaker 10: sometimes it's tough, as you point out, it can get 387 00:20:44,320 --> 00:20:49,119 Speaker 10: out of control, but by and large, I am a 388 00:20:49,160 --> 00:20:52,080 Speaker 10: big believer in that these guys have to go and 389 00:20:52,160 --> 00:20:54,080 Speaker 10: face the music. And if you're good at what you 390 00:20:54,160 --> 00:20:56,520 Speaker 10: do for your day job, then you ought to be 391 00:20:56,560 --> 00:20:59,040 Speaker 10: able to sell what you just did in this case 392 00:20:59,119 --> 00:21:03,440 Speaker 10: on the Reconciliation bill and answer the questions that people 393 00:21:03,480 --> 00:21:06,080 Speaker 10: have and give it your best shot, because if you don't, 394 00:21:06,560 --> 00:21:09,639 Speaker 10: they will only hear the Democratic talking point and that 395 00:21:09,680 --> 00:21:11,679 Speaker 10: ain't going to help you at all. 396 00:21:11,760 --> 00:21:15,080 Speaker 4: You know, It's interesting, guys, because the lawmakers who are 397 00:21:15,080 --> 00:21:17,560 Speaker 4: actually choosing to do town halls, let's just take the 398 00:21:17,600 --> 00:21:21,080 Speaker 4: two names we've already mentioned here. Brian style and now 399 00:21:21,160 --> 00:21:25,719 Speaker 4: Mike Flood are not considered MAGA, they're not considered the 400 00:21:25,720 --> 00:21:29,159 Speaker 4: most conservative members of their conference. In the case of 401 00:21:29,240 --> 00:21:32,280 Speaker 4: Mike Flood, Genie, he was on the program here less 402 00:21:32,320 --> 00:21:34,879 Speaker 4: than two weeks ago. Remember, they had just passed the 403 00:21:34,960 --> 00:21:39,520 Speaker 4: recisions package President's Big beautiful Bill, and he actually didn't 404 00:21:39,560 --> 00:21:42,240 Speaker 4: seem to like any of the procedure around this. That 405 00:21:42,320 --> 00:21:45,880 Speaker 4: has upset a lot of Democrats. Let's back up less 406 00:21:45,880 --> 00:21:48,280 Speaker 4: than two weeks. Mike Flood here on balance of power. 407 00:21:48,280 --> 00:21:50,760 Speaker 11: Listen, I don't want to talk about recisions either. We 408 00:21:50,840 --> 00:21:55,359 Speaker 11: have a process for appropriations. We appropriate the money, we 409 00:21:55,480 --> 00:21:58,560 Speaker 11: pass a budget. We use our article, want authority and 410 00:21:58,600 --> 00:21:59,800 Speaker 11: our power of the purse. 411 00:21:59,600 --> 00:22:01,560 Speaker 3: To do our job. 412 00:22:01,800 --> 00:22:03,960 Speaker 11: Listen, I signed out to be in Congress. I signed 413 00:22:04,000 --> 00:22:08,000 Speaker 11: up to a help craft legislation, put budgets together, decide 414 00:22:08,000 --> 00:22:10,119 Speaker 11: where the spending goes. I don't want to hear the 415 00:22:10,119 --> 00:22:12,600 Speaker 11: word recision. I don't want to hear the word impoundment. 416 00:22:12,760 --> 00:22:15,200 Speaker 11: I really don't even want to hear the word reconciliation. 417 00:22:15,720 --> 00:22:17,360 Speaker 3: I want to get back. 418 00:22:17,160 --> 00:22:19,159 Speaker 11: To work and I want to pass a budget. 419 00:22:20,240 --> 00:22:23,240 Speaker 4: He doesn't even want to use the word reconciliation, nevermind 420 00:22:23,240 --> 00:22:26,880 Speaker 4: recision or impoundment Genie. He almost sounds like a Democrat there. 421 00:22:26,880 --> 00:22:28,359 Speaker 4: What's the problem with Mike Flood. 422 00:22:30,280 --> 00:22:32,800 Speaker 9: I don't think there's a problem with Mike Flood except 423 00:22:32,840 --> 00:22:35,879 Speaker 9: for the fact that he voted in favor of a 424 00:22:35,920 --> 00:22:39,920 Speaker 9: bill that he told his constituents he didn't even read. 425 00:22:40,240 --> 00:22:42,840 Speaker 9: He is one thousand percent right they should move away 426 00:22:42,920 --> 00:22:48,680 Speaker 9: from recisions unless they are completely supported with documented evidence, 427 00:22:48,720 --> 00:22:51,080 Speaker 9: that we should get back to regular order, as Rick 428 00:22:51,240 --> 00:22:54,560 Speaker 9: likes to say. But you listen to him there, and 429 00:22:54,600 --> 00:22:58,479 Speaker 9: he sounds like his constituents who were frustrated at that 430 00:22:58,640 --> 00:23:02,199 Speaker 9: town hall. And he even went out and said that 431 00:23:02,840 --> 00:23:05,040 Speaker 9: if there's a problem with this bill that I have 432 00:23:05,160 --> 00:23:07,959 Speaker 9: voted for, we can go back and revisit it and 433 00:23:08,000 --> 00:23:12,200 Speaker 9: rethink some of it very much, sounding like Josh Hawley 434 00:23:12,520 --> 00:23:16,280 Speaker 9: and some other Republicans. But the reality is you voted 435 00:23:16,600 --> 00:23:20,080 Speaker 9: for the bill, and pulling back on any part of 436 00:23:20,119 --> 00:23:23,280 Speaker 9: that is going to be all but impossible. So he 437 00:23:23,400 --> 00:23:27,280 Speaker 9: is acknowledging the frustration his constituents are feeling. You gave 438 00:23:27,320 --> 00:23:30,240 Speaker 9: a big tax break for the ultra wealthy. You are 439 00:23:30,280 --> 00:23:33,560 Speaker 9: cutting people off of healthcare in the millions, You're cutting 440 00:23:33,600 --> 00:23:37,159 Speaker 9: back on money for food, for Needy all the while 441 00:23:37,720 --> 00:23:40,159 Speaker 9: they're building a ballroom at the White House for two 442 00:23:40,240 --> 00:23:42,760 Speaker 9: hundred million dollars and you're standing up there saying we 443 00:23:42,880 --> 00:23:45,439 Speaker 9: don't have money. I mean, the number of ways in 444 00:23:45,480 --> 00:23:48,080 Speaker 9: which people can just go around this is you know, 445 00:23:48,680 --> 00:23:52,840 Speaker 9: so so must be so frustrating for him because you 446 00:23:52,960 --> 00:23:56,639 Speaker 9: know that he probably is understanding what they're saying, but 447 00:23:56,800 --> 00:24:00,000 Speaker 9: because he's under the thumb of Trump and the Maga universe, 448 00:24:00,160 --> 00:24:02,040 Speaker 9: he hasn't been able to say it, and they're calling 449 00:24:02,119 --> 00:24:02,760 Speaker 9: him out on that. 450 00:24:04,200 --> 00:24:06,639 Speaker 2: We should note that President Trump says he and donors 451 00:24:06,640 --> 00:24:09,040 Speaker 2: will be footing the bill for that two hundred million 452 00:24:09,119 --> 00:24:11,919 Speaker 2: dollar ballroom. He actually reiterated as much when he was 453 00:24:11,920 --> 00:24:15,080 Speaker 2: on the roof of the White House earlier today. He 454 00:24:15,080 --> 00:24:17,600 Speaker 2: told reporters he was just taking a little walk. When 455 00:24:17,600 --> 00:24:19,280 Speaker 2: he was asked if he was thinking about adding a 456 00:24:19,359 --> 00:24:22,040 Speaker 2: second story potentially, he didn't necessarily answer, but he did 457 00:24:22,119 --> 00:24:25,040 Speaker 2: make the point, Joe that he would finance any projects. 458 00:24:25,119 --> 00:24:25,560 Speaker 3: That's true. 459 00:24:25,720 --> 00:24:27,359 Speaker 4: Yeah, look at him up there, by the way, if 460 00:24:27,359 --> 00:24:30,159 Speaker 4: you're with us on Bloomberg TV or on YouTube. The 461 00:24:30,160 --> 00:24:32,320 Speaker 4: President of the United States walked out on the roof 462 00:24:32,359 --> 00:24:35,000 Speaker 4: of the West Wing out of the State dining room. 463 00:24:35,000 --> 00:24:38,080 Speaker 4: He had the architect of that ballroom that Genie mentions, 464 00:24:38,280 --> 00:24:41,160 Speaker 4: and he held a gaggle from the roof with questions 465 00:24:41,200 --> 00:24:43,680 Speaker 4: being held up to him, implying they're going to build 466 00:24:43,720 --> 00:24:45,800 Speaker 4: something up there. Kaylee, I wonder if they're going to 467 00:24:45,800 --> 00:24:47,240 Speaker 4: put a skylight in the briefing room. 468 00:24:47,440 --> 00:24:49,359 Speaker 2: I guess we're all going to have to stay tuned 469 00:24:49,400 --> 00:24:53,520 Speaker 2: on the latest White House renovation project. They are numerous. 470 00:24:53,520 --> 00:24:56,240 Speaker 2: Apparently there's more guilding going into the Ogle office as well. 471 00:24:56,240 --> 00:24:58,159 Speaker 2: We've got the flat. You hear about the rosegard We're 472 00:24:58,160 --> 00:25:01,480 Speaker 2: doing the ceiling though, I guess yeah. To get back 473 00:25:01,520 --> 00:25:04,920 Speaker 2: to what we were just discussing, though, Rufe adventure aside, Rick, 474 00:25:05,200 --> 00:25:08,960 Speaker 2: As we consider the messaging around this bill, the struggle 475 00:25:09,000 --> 00:25:11,800 Speaker 2: Republicans are finding themselves in and trying to defend their 476 00:25:11,840 --> 00:25:14,200 Speaker 2: positions on this what does this all mean in reality 477 00:25:14,240 --> 00:25:17,400 Speaker 2: for twenty twenty six because some of those unpopular provisions 478 00:25:17,440 --> 00:25:19,840 Speaker 2: that Genie was just referring to won't have even actually 479 00:25:19,880 --> 00:25:23,040 Speaker 2: been implemented by the time the midterms roll around. So 480 00:25:23,040 --> 00:25:25,480 Speaker 2: as angry as people might be, now, do you see 481 00:25:25,520 --> 00:25:28,119 Speaker 2: that lasting until next November when they haven't felt the 482 00:25:28,119 --> 00:25:28,760 Speaker 2: effects yet? 483 00:25:29,800 --> 00:25:34,680 Speaker 10: Well? I do think Genie makes a good point. The 484 00:25:34,720 --> 00:25:37,720 Speaker 10: answers to the questions that we're hearing from the Brian 485 00:25:37,800 --> 00:25:41,720 Speaker 10: styles and the Mike Floods are things like, oh well, 486 00:25:41,840 --> 00:25:44,720 Speaker 10: I wasn't for this either, or we can change some 487 00:25:44,840 --> 00:25:47,480 Speaker 10: of this when we get back to Congress. And if 488 00:25:47,480 --> 00:25:51,120 Speaker 10: you look at the sort of articulation of the concerns 489 00:25:51,119 --> 00:25:54,239 Speaker 10: people have, especially around the Medicaid, they already get it. 490 00:25:55,280 --> 00:25:58,840 Speaker 10: I would have thought that until it actually impacted them, 491 00:25:59,320 --> 00:26:02,399 Speaker 10: they would not have been this voiceless. But whether that's 492 00:26:02,920 --> 00:26:07,040 Speaker 10: good democratic talking points or people paying attention don't care 493 00:26:07,080 --> 00:26:09,440 Speaker 10: when it actually comes into effect because they know it's 494 00:26:09,520 --> 00:26:12,040 Speaker 10: going to and that it's going to affect their families 495 00:26:12,119 --> 00:26:16,320 Speaker 10: or their families families, I think they've already been lit 496 00:26:16,440 --> 00:26:20,000 Speaker 10: up and the explosion is likely to occur, you know, 497 00:26:20,040 --> 00:26:24,159 Speaker 10: in November twenty twenty six. I don't think it's a 498 00:26:24,200 --> 00:26:26,920 Speaker 10: wait and see attitude that the public's taking based on 499 00:26:27,000 --> 00:26:29,679 Speaker 10: some of the anecdotal evidence we're seeing on the ground 500 00:26:29,760 --> 00:26:32,720 Speaker 10: in front of these districts. And I might add, these 501 00:26:32,760 --> 00:26:35,639 Speaker 10: are two vulnerable Republicans, right, I mean, these are guys 502 00:26:35,760 --> 00:26:40,439 Speaker 10: on the Democratic target list to be taken out, and 503 00:26:41,080 --> 00:26:43,639 Speaker 10: they made a lot of good commercials for their Democratic 504 00:26:43,640 --> 00:26:46,480 Speaker 10: opponents just by holding these town halls and backing off 505 00:26:46,520 --> 00:26:48,360 Speaker 10: of what they already had voted for. 506 00:26:49,520 --> 00:26:53,240 Speaker 4: Fascinating, Genie, Are Democrats holding town halls right now or 507 00:26:53,320 --> 00:26:54,000 Speaker 4: is there no point? 508 00:26:55,840 --> 00:26:58,480 Speaker 9: Yeah? I mean they are out there. They've got a 509 00:26:58,520 --> 00:27:01,840 Speaker 9: lot of work to do. They have got to make 510 00:27:01,920 --> 00:27:06,360 Speaker 9: the case that this bill is against what the president 511 00:27:06,480 --> 00:27:10,359 Speaker 9: promised when he was running, and that to support the 512 00:27:10,440 --> 00:27:12,760 Speaker 9: working in the middle class, and they are making a 513 00:27:12,800 --> 00:27:15,159 Speaker 9: message of repealing it. I don't know if they're going 514 00:27:15,240 --> 00:27:17,879 Speaker 9: to be successful on that, but I think we should 515 00:27:17,920 --> 00:27:21,440 Speaker 9: also keep in mind that this all may help explain 516 00:27:21,600 --> 00:27:26,160 Speaker 9: this push to redistrict in Texas and elsewhere. The Republicans 517 00:27:26,320 --> 00:27:28,920 Speaker 9: know that they are in a bit of trouble or 518 00:27:29,000 --> 00:27:31,600 Speaker 9: a lot of trouble as they look out and look 519 00:27:31,640 --> 00:27:35,600 Speaker 9: into twenty twenty six. Hence the argument that we've got 520 00:27:35,600 --> 00:27:38,200 Speaker 9: to redraw these districts if we're going to hold the House, 521 00:27:38,280 --> 00:27:41,760 Speaker 9: because we can't defend what we have done when we've 522 00:27:41,760 --> 00:27:45,160 Speaker 9: been in Congress. And that's going to be a huge, 523 00:27:45,280 --> 00:27:48,880 Speaker 9: huge talking point for Democrats as well. 524 00:27:48,960 --> 00:27:51,919 Speaker 2: All Right, Jeanie Shanzeno and Rick Davis our Political Panel 525 00:27:52,240 --> 00:27:54,520 Speaker 2: on this Tuesday. Thank you so much, Jennie. Thank you 526 00:27:54,600 --> 00:27:57,359 Speaker 2: especially for giving us the opportunity to talk about the 527 00:27:57,400 --> 00:28:00,760 Speaker 2: president's morning White House roof adventure. I'm more still had 528 00:28:00,760 --> 00:28:06,159 Speaker 2: here in Balance of Power on Bloomberg TV and Radio. 529 00:28:06,960 --> 00:28:10,440 Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch 530 00:28:10,520 --> 00:28:13,960 Speaker 1: us live weekdays at noon and five pm Eastern on Apple, 531 00:28:14,000 --> 00:28:17,359 Speaker 1: Cocklay and Android Auto with the Bloomberg Business App. Listen 532 00:28:17,440 --> 00:28:20,560 Speaker 1: on demand wherever you get your podcasts, or watch us 533 00:28:20,600 --> 00:28:21,960 Speaker 1: live on YouTube. 534 00:28:23,080 --> 00:28:26,160 Speaker 4: Yeah, it's only Tuesday, and it's already been a pretty 535 00:28:26,200 --> 00:28:28,639 Speaker 4: newsy week, considering the fact that the House and Senate 536 00:28:28,680 --> 00:28:33,240 Speaker 4: are both gonzo, and we have no major public events 537 00:28:33,320 --> 00:28:35,239 Speaker 4: in the works here at the White House. Although, did 538 00:28:35,280 --> 00:28:37,240 Speaker 4: you see the President on the roof a little while ago. 539 00:28:37,280 --> 00:28:40,840 Speaker 4: I've never been watching Washington for some time, never seen 540 00:28:40,880 --> 00:28:42,760 Speaker 4: the President on the roof of the West Wing. It 541 00:28:42,800 --> 00:28:44,760 Speaker 4: was up there, right up on top of the briefing 542 00:28:44,840 --> 00:28:47,560 Speaker 4: room with who appeared to be the architect of the 543 00:28:47,560 --> 00:28:48,640 Speaker 4: new ballroom. 544 00:28:48,240 --> 00:28:49,640 Speaker 3: That's being installed at the White House. 545 00:28:49,640 --> 00:28:52,040 Speaker 4: The President actually was shouting down to reporters who were 546 00:28:52,560 --> 00:28:57,800 Speaker 4: shouting questions at him. He says, they're working on something beautiful. 547 00:28:58,360 --> 00:29:00,840 Speaker 4: Maybe they'll get skylights in the reefing room. That would 548 00:29:00,880 --> 00:29:05,560 Speaker 4: be kind of a bit dungeony in there. So with 549 00:29:05,680 --> 00:29:10,520 Speaker 4: the Senate gone, maybe it makes sense when the majority 550 00:29:10,520 --> 00:29:15,160 Speaker 4: of Leader John Thune says the process is broken. He's 551 00:29:15,200 --> 00:29:20,000 Speaker 4: referring to the process for confirming nominations, routine nominations to 552 00:29:20,040 --> 00:29:23,200 Speaker 4: the Pentagon, and what appeared to be a deal in 553 00:29:23,240 --> 00:29:25,440 Speaker 4: the works with Chuck Schumer last weekend fell apart. We 554 00:29:25,480 --> 00:29:28,560 Speaker 4: haven't talked about this a lot outside of a brief 555 00:29:28,600 --> 00:29:32,680 Speaker 4: mention yesterday. There's very big reason why there are calls 556 00:29:32,720 --> 00:29:36,080 Speaker 4: now or predictions even louder predictions for a government shutdown 557 00:29:36,120 --> 00:29:39,440 Speaker 4: in September, because no one is getting along. When this 558 00:29:39,480 --> 00:29:42,320 Speaker 4: came to be an opportunity over the weekend to start 559 00:29:42,360 --> 00:29:50,040 Speaker 4: confirming nominees, en mass Democrats asked for no more recisions packages. 560 00:29:50,080 --> 00:29:53,360 Speaker 4: I want to promise on that and to reinstate some 561 00:29:53,520 --> 00:29:57,560 Speaker 4: already approved funding for foreign aid and some other programs 562 00:29:57,640 --> 00:30:01,480 Speaker 4: they got nowhere, talks broke down and everybody went home. 563 00:30:02,360 --> 00:30:04,920 Speaker 4: And now this has left a lot of people still 564 00:30:04,920 --> 00:30:10,080 Speaker 4: on the field here. Remembering that President Trump at one 565 00:30:10,080 --> 00:30:12,280 Speaker 4: point said he wanted the Senate to stay here until 566 00:30:12,320 --> 00:30:15,560 Speaker 4: the work was done. Work through August, if you have to, well, 567 00:30:15,560 --> 00:30:17,960 Speaker 4: that never happened. Democrats were able to use the rules 568 00:30:17,960 --> 00:30:20,560 Speaker 4: of the Senate to delay dozens of votes on Trump 569 00:30:20,560 --> 00:30:23,280 Speaker 4: nominees until fall. And this is where we start our 570 00:30:23,320 --> 00:30:27,040 Speaker 4: conversation with General Penaro. Really glad to say that he's back, 571 00:30:27,080 --> 00:30:29,120 Speaker 4: because this is an individual who knows what it's like 572 00:30:29,160 --> 00:30:33,040 Speaker 4: to prep these nominees for their confirmation hearings and has 573 00:30:33,920 --> 00:30:38,640 Speaker 4: the rule book memorized. Cold retired Marine Corps General, former 574 00:30:38,680 --> 00:30:41,840 Speaker 4: staff director of the Senate Armed Services Committee, General Arnold Panaro, 575 00:30:41,880 --> 00:30:44,360 Speaker 4: Welcome back to Bloomberg. It's great to see you, sir, 576 00:30:44,440 --> 00:30:47,280 Speaker 4: Is John Thune Wright. The process is broken. 577 00:30:48,960 --> 00:30:52,120 Speaker 6: Well, Joe, privileged to be with you, and I call 578 00:30:52,200 --> 00:30:55,880 Speaker 6: the August recess all play and no work. And unfortunately 579 00:30:55,960 --> 00:30:57,880 Speaker 6: the Senate and the House won't be back till the 580 00:30:57,920 --> 00:31:01,360 Speaker 6: first week in September, and our national security has not 581 00:31:01,480 --> 00:31:05,640 Speaker 6: gone on vacation. And unfortunately the majority leader is correct. 582 00:31:06,240 --> 00:31:10,080 Speaker 6: The process has deteriorated and broken down over the years. 583 00:31:10,280 --> 00:31:13,640 Speaker 6: And as you've said on your program, often the world 584 00:31:13,720 --> 00:31:15,840 Speaker 6: is more dangerous and unstable than the peak of the 585 00:31:15,840 --> 00:31:18,800 Speaker 6: Cold War, and we need these senior people in the 586 00:31:18,880 --> 00:31:22,680 Speaker 6: Nikey national security jobs on the job and not sitting 587 00:31:22,720 --> 00:31:26,480 Speaker 6: in confirmation purgatory in the US Senate where they are today. 588 00:31:27,560 --> 00:31:30,960 Speaker 6: The administration, the President is nominated fifty five of the 589 00:31:31,040 --> 00:31:35,560 Speaker 6: sixty five presidentially appointed Senate confirmed individuals that run DoD, 590 00:31:35,960 --> 00:31:39,200 Speaker 6: a record for this point in any administration, and yet 591 00:31:39,520 --> 00:31:42,479 Speaker 6: only fifteen of them have been confirmed by the Senate. 592 00:31:42,920 --> 00:31:45,960 Speaker 6: We left fourteen pending on the Senate Executive calendar that 593 00:31:46,040 --> 00:31:49,400 Speaker 6: should have been confirmed by unanimous consent and voice vote. 594 00:31:49,400 --> 00:31:53,040 Speaker 6: There's another twenty four in the Armed Services Committee awaiting 595 00:31:53,120 --> 00:31:57,280 Speaker 6: processing in the Doe Nuclear Complex that runs our nuclear 596 00:31:57,320 --> 00:32:00,800 Speaker 6: weapons surity and safety and provides the warheads that we 597 00:32:00,840 --> 00:32:04,640 Speaker 6: need for strategic nuclear deterrence. Four of the five are 598 00:32:04,640 --> 00:32:07,240 Speaker 6: in the penning in the Senate. And yet Brandon Williams, 599 00:32:07,440 --> 00:32:10,880 Speaker 6: who's going to run the Nuclear Security Administration, has been 600 00:32:10,920 --> 00:32:17,000 Speaker 6: penning since January twentieth and very capable, very experienced individual 601 00:32:17,320 --> 00:32:21,280 Speaker 6: and so we are really it is broken. I think 602 00:32:21,320 --> 00:32:24,680 Speaker 6: that the majority leader, unfortunately is absolutely correct. 603 00:32:24,760 --> 00:32:25,440 Speaker 3: It is broken. 604 00:32:26,520 --> 00:32:29,840 Speaker 4: Well, there's a move now by Senate Republicans to consider 605 00:32:30,480 --> 00:32:33,000 Speaker 4: changes to the rules of the Senate that would allow 606 00:32:33,040 --> 00:32:35,800 Speaker 4: them to move without Democrats, essentially a simple majority here 607 00:32:35,800 --> 00:32:38,880 Speaker 4: approve the president's nominees on their own. Does that need 608 00:32:38,920 --> 00:32:39,640 Speaker 4: to happen next? 609 00:32:40,800 --> 00:32:43,760 Speaker 6: Well, you actually have a simple majority now. But the 610 00:32:43,800 --> 00:32:47,440 Speaker 6: simple majority you have now won when they won't agree 611 00:32:47,480 --> 00:32:50,800 Speaker 6: to do anything by unanimous consent or voice vote, which 612 00:32:50,840 --> 00:32:54,800 Speaker 6: has been the standard for these non controversial national security 613 00:32:54,840 --> 00:32:58,800 Speaker 6: nominations in every administration, you have to file cloture, and 614 00:32:58,920 --> 00:33:02,600 Speaker 6: cloture is a majority vote. Once you get cloture on 615 00:33:02,680 --> 00:33:06,720 Speaker 6: a nominee because of the filibuster of that nomination, then 616 00:33:06,800 --> 00:33:09,320 Speaker 6: you have two hours of post cloture debate before you 617 00:33:09,360 --> 00:33:12,200 Speaker 6: can vote on the actual nominee, which also is a 618 00:33:12,240 --> 00:33:16,000 Speaker 6: majority vote. So you technically have it now, but the 619 00:33:16,080 --> 00:33:19,840 Speaker 6: cloture petition can take two legislative days before you can 620 00:33:19,920 --> 00:33:22,080 Speaker 6: vote on it. Then you have the time afterwards. So 621 00:33:22,560 --> 00:33:25,280 Speaker 6: I think what they will look at when they come back. 622 00:33:25,600 --> 00:33:28,600 Speaker 6: If there's no agreement on a package, and there should be, 623 00:33:29,040 --> 00:33:31,480 Speaker 6: just like there should have been before the recess, then 624 00:33:31,560 --> 00:33:35,320 Speaker 6: I think that the leadership on the Republican side will 625 00:33:35,320 --> 00:33:38,480 Speaker 6: correctly look at how do we shorten all these timeframes, 626 00:33:38,520 --> 00:33:41,160 Speaker 6: how do we reduce the amount of time it takes 627 00:33:41,240 --> 00:33:43,840 Speaker 6: us to get these nominees through, and how do we 628 00:33:43,880 --> 00:33:46,400 Speaker 6: do more at a time than just one at a time, 629 00:33:46,640 --> 00:33:48,480 Speaker 6: so I think all of those things will be on 630 00:33:48,560 --> 00:33:49,040 Speaker 6: the table. 631 00:33:50,200 --> 00:33:50,760 Speaker 3: Fascinating. 632 00:33:50,880 --> 00:33:53,960 Speaker 4: This is really instructive, General, and I brings us back 633 00:33:54,000 --> 00:33:58,480 Speaker 4: to the conversations we were having around the Senator Tubberville blockade, 634 00:33:58,600 --> 00:34:03,800 Speaker 4: conversations about not only military readiness, but chaos within the 635 00:34:03,800 --> 00:34:08,560 Speaker 4: military culture, families that are waiting to move, families and 636 00:34:08,600 --> 00:34:13,080 Speaker 4: in this case, perspective generals who are not going to 637 00:34:13,200 --> 00:34:15,920 Speaker 4: be made good on pay that they missed while waiting. 638 00:34:16,000 --> 00:34:19,120 Speaker 4: These are all real factors for these nominees as well. 639 00:34:19,200 --> 00:34:21,200 Speaker 3: Right, That's correct. 640 00:34:21,200 --> 00:34:23,960 Speaker 6: And the good news in this particular Congress is we're 641 00:34:24,000 --> 00:34:26,959 Speaker 6: not seeing any hold up on our senior military nominations 642 00:34:27,320 --> 00:34:31,360 Speaker 6: or any of the n block nominations of our field 643 00:34:31,360 --> 00:34:34,160 Speaker 6: grade officers, so those are moving through at a pace. 644 00:34:34,239 --> 00:34:37,360 Speaker 6: We just confirmed the new Chief of Naval Operations to 645 00:34:37,640 --> 00:34:42,360 Speaker 6: additional war fighting combatant commanders they and several would confirmed 646 00:34:42,400 --> 00:34:45,799 Speaker 6: weeks before. So the military we are not facing the 647 00:34:45,840 --> 00:34:49,439 Speaker 6: Senator Tuberville hole, which, as you know, was opposed by 648 00:34:49,640 --> 00:34:54,480 Speaker 6: four Republicans with combat experience, Senator Dan Sullivan, Senator Joey Arnt, 649 00:34:54,520 --> 00:34:59,040 Speaker 6: Senator Todd Young, and Senator Lindsay Graham Republicans, saying that 650 00:34:59,120 --> 00:35:03,680 Speaker 6: Senator Tuberville Hole was unwarranted over nine hundred senior military 651 00:35:03,719 --> 00:35:07,279 Speaker 6: nominations for close to nine months. We're not seeing that now, 652 00:35:07,360 --> 00:35:08,040 Speaker 6: Thank goodness. 653 00:35:09,800 --> 00:35:11,279 Speaker 3: This is good to know. 654 00:35:11,400 --> 00:35:13,120 Speaker 4: I want to ask you about a couple of other 655 00:35:13,160 --> 00:35:15,440 Speaker 4: things happening at the Pentagon right now. And we had 656 00:35:15,440 --> 00:35:18,440 Speaker 4: a really interesting conversation yesterday with the US Ambassador to 657 00:35:18,520 --> 00:35:22,279 Speaker 4: NATO about a pretty important announcement when it comes to 658 00:35:22,320 --> 00:35:26,919 Speaker 4: providing US made weapons to Ukraine. In this case, though, 659 00:35:26,920 --> 00:35:29,000 Speaker 4: as the President had announced a couple of weeks ago, 660 00:35:29,560 --> 00:35:33,160 Speaker 4: NATO allies will be buying the weapons and transferring them 661 00:35:33,200 --> 00:35:35,880 Speaker 4: to Ukraine, as opposed to going to Congress, coming up 662 00:35:35,920 --> 00:35:39,960 Speaker 4: with a weapons package and putting it overseas to our 663 00:35:40,000 --> 00:35:43,000 Speaker 4: allies in Kiev. We talked to Matthew Whitaker about this, 664 00:35:43,160 --> 00:35:44,560 Speaker 4: the NATO Ambassador General. 665 00:35:44,600 --> 00:35:45,279 Speaker 3: Here's what he said. 666 00:35:46,080 --> 00:35:47,759 Speaker 8: I want to make sure that the United States has 667 00:35:47,800 --> 00:35:51,200 Speaker 8: never at a strategic disadvantage or puts ourselves in a 668 00:35:51,280 --> 00:35:55,479 Speaker 8: vulnerable position. And so what we're providing is what would 669 00:35:55,520 --> 00:35:59,880 Speaker 8: be considered access in addition to what we need to 670 00:36:00,080 --> 00:36:02,920 Speaker 8: defend ourselves strategically. But at the same time. 671 00:36:03,040 --> 00:36:04,760 Speaker 3: You know, we're still manufacturing. 672 00:36:04,920 --> 00:36:09,759 Speaker 8: We see the need in Ukraine. We've then, you know, 673 00:36:09,800 --> 00:36:13,560 Speaker 8: the people at the Pentagon, especially the generals that manage 674 00:36:13,640 --> 00:36:17,560 Speaker 8: a lot of these important programs, looked and determined what 675 00:36:17,640 --> 00:36:21,040 Speaker 8: we could sell to our NATO allies and. 676 00:36:21,000 --> 00:36:22,720 Speaker 3: Then they could provide them to Ukraine. 677 00:36:23,880 --> 00:36:26,520 Speaker 4: Do you like this idea, this plan, General, and do 678 00:36:26,560 --> 00:36:30,200 Speaker 4: you worry about eliminating some of our own stocks? There 679 00:36:30,280 --> 00:36:33,400 Speaker 4: was a moment there where the Pentagon had halted supplies 680 00:36:33,440 --> 00:36:37,279 Speaker 4: to Ukraine, suggesting that we needed to preserve our own 681 00:36:37,400 --> 00:36:39,480 Speaker 4: arsenal for our own uses here at home. 682 00:36:39,520 --> 00:36:41,520 Speaker 3: What's your thought, well, Joe, I. 683 00:36:41,440 --> 00:36:43,760 Speaker 6: Think we have to take the strategic view. We cannot 684 00:36:43,800 --> 00:36:46,919 Speaker 6: allow Russia to be successful in Ukraine. They wouldn't stop there. 685 00:36:47,000 --> 00:36:49,800 Speaker 6: And also if they were successful, it would mold in China. 686 00:36:50,120 --> 00:36:52,480 Speaker 6: I ran in North Korea, which would be a bad situation. 687 00:36:52,640 --> 00:36:55,880 Speaker 6: And so I don't know the ambassador but I'm very 688 00:36:55,920 --> 00:36:58,920 Speaker 6: impressed with what I've seen of him today. Remember, at 689 00:36:58,920 --> 00:37:01,359 Speaker 6: the outset of the administry there was concern that we're 690 00:37:01,360 --> 00:37:03,360 Speaker 6: going to abandon NATO and abandon Ukraine. 691 00:37:03,440 --> 00:37:04,440 Speaker 3: That has not happened. 692 00:37:04,640 --> 00:37:07,080 Speaker 6: So I would say this is a really good positive 693 00:37:07,120 --> 00:37:10,239 Speaker 6: mood where we get the NATO allies to do more 694 00:37:10,280 --> 00:37:14,080 Speaker 6: of the burden sharing, a longstanding principle of President Trump 695 00:37:14,480 --> 00:37:17,240 Speaker 6: get these weapons into the hands of the Ukrainians. Quicker. 696 00:37:17,640 --> 00:37:20,239 Speaker 6: I think we also need the President needs to move 697 00:37:20,239 --> 00:37:22,640 Speaker 6: out on the sanctions that he's talked about on Russia 698 00:37:22,960 --> 00:37:26,120 Speaker 6: and those people that are helping Russia, you know, perpetuate 699 00:37:26,200 --> 00:37:31,520 Speaker 6: this war. And I think also the Deputy Secretary of Defense, 700 00:37:31,520 --> 00:37:35,920 Speaker 6: Steve Finberg, is working with our munition suppliers to significantly 701 00:37:36,040 --> 00:37:39,120 Speaker 6: enhance it. If you look at the Reconciliation bill that 702 00:37:39,320 --> 00:37:43,319 Speaker 6: passed the House and the Senate marked up by the 703 00:37:43,320 --> 00:37:48,759 Speaker 6: two authorizing committees of substantial increases in our munitions, and 704 00:37:48,880 --> 00:37:51,520 Speaker 6: our industry is getting ready to Roger up to really 705 00:37:51,560 --> 00:37:54,160 Speaker 6: beat that up. So I think a combination of all 706 00:37:54,200 --> 00:37:57,239 Speaker 6: of these factors are all needed. You can't just do one. 707 00:37:57,320 --> 00:38:00,560 Speaker 6: I think all of the above is necessary. 708 00:38:00,760 --> 00:38:02,800 Speaker 4: It's time to Roger Rupp, says the General. We just 709 00:38:02,880 --> 00:38:06,480 Speaker 4: got a headline while we're talking here, General Penaro, Russia 710 00:38:06,560 --> 00:38:10,200 Speaker 4: mulling Ukraine air truce offer to Trump without ending the war. 711 00:38:10,280 --> 00:38:12,439 Speaker 4: We've got a deadline coming at the end of this week. 712 00:38:12,480 --> 00:38:16,759 Speaker 4: The President says. Secondary sanctions go on Russia and it's 713 00:38:16,800 --> 00:38:21,120 Speaker 4: trading partners. If the bombing of civilians does not cease. 714 00:38:21,239 --> 00:38:25,000 Speaker 4: The Kremlin now weighing options, according to Bloomberg News, for 715 00:38:25,040 --> 00:38:28,360 Speaker 4: a concession, including an air truce with Ukraine. 716 00:38:28,520 --> 00:38:29,560 Speaker 3: Do you see that happening? 717 00:38:30,920 --> 00:38:33,600 Speaker 6: Well, look, Joe, I hate to say, I'm a very 718 00:38:33,640 --> 00:38:36,080 Speaker 6: realistic I've been in a war where I was told 719 00:38:36,080 --> 00:38:38,799 Speaker 6: there was a ceasefire and a truce and those things 720 00:38:38,880 --> 00:38:43,359 Speaker 6: never happen. I wouldn't trust Russia one centil you know. 721 00:38:43,440 --> 00:38:46,799 Speaker 6: I think they basically we've got to bring the hammer down. 722 00:38:47,520 --> 00:38:50,040 Speaker 6: That's the only thing that putin understand He's a thug. 723 00:38:50,080 --> 00:38:52,640 Speaker 6: He kills his own people, he has no regard for 724 00:38:52,719 --> 00:38:56,960 Speaker 6: human life. He's killing women, children, infants. I wouldn't trust him, 725 00:38:57,239 --> 00:38:59,359 Speaker 6: and I think we've got to bring the hammer down 726 00:38:59,400 --> 00:39:01,960 Speaker 6: and do all the things that we just discussed, Put 727 00:39:01,960 --> 00:39:04,920 Speaker 6: the sanctions in place, give Ukraines of weapons they need 728 00:39:04,960 --> 00:39:08,160 Speaker 6: to defend their country, both offensively and defensively. 729 00:39:08,400 --> 00:39:08,719 Speaker 8: I don't. 730 00:39:08,760 --> 00:39:09,360 Speaker 3: I wouldn't. 731 00:39:09,560 --> 00:39:12,799 Speaker 6: I wouldn't be very careful. I wouldn't trust them. I've 732 00:39:12,800 --> 00:39:16,120 Speaker 6: been in actual in combat when I was told there 733 00:39:16,200 --> 00:39:18,359 Speaker 6: was a cease fire and a truce, and the other 734 00:39:18,440 --> 00:39:19,360 Speaker 6: side never honored it. 735 00:39:20,520 --> 00:39:21,960 Speaker 3: Which which battle was that? 736 00:39:22,239 --> 00:39:26,040 Speaker 6: General, Well, this goes back to Vietnam, you know, the 737 00:39:26,520 --> 00:39:29,360 Speaker 6: where we had different things in Vietnam. And but I 738 00:39:29,640 --> 00:39:32,920 Speaker 6: mean I also know from being in the First Iraq 739 00:39:32,960 --> 00:39:35,680 Speaker 6: War when there was said talks about well you're in 740 00:39:35,719 --> 00:39:37,799 Speaker 6: a no fire zoneer, you're in a free fire zone, 741 00:39:37,840 --> 00:39:41,200 Speaker 6: things like that. Though, I mean, when you're on the battlefield, 742 00:39:41,440 --> 00:39:43,799 Speaker 6: you know, Murphy's law works all the time. You know, 743 00:39:43,840 --> 00:39:44,399 Speaker 6: you've got to. 744 00:39:44,320 --> 00:39:45,400 Speaker 3: Be prepared for anything. 745 00:39:45,440 --> 00:39:48,839 Speaker 6: And so the Russians have never been good at their 746 00:39:48,840 --> 00:39:51,439 Speaker 6: work when it comes to this, and so why would 747 00:39:51,480 --> 00:39:52,080 Speaker 6: we trust them? 748 00:39:52,080 --> 00:39:52,239 Speaker 7: Now? 749 00:39:53,000 --> 00:39:56,880 Speaker 6: Ronald Reagan was right terrify. I think the hammer. I 750 00:39:56,880 --> 00:39:59,719 Speaker 6: think the President is right to bring the hammer down. 751 00:40:00,800 --> 00:40:03,880 Speaker 4: Bringing as many years of experience to us here on Bloomberg. 752 00:40:03,920 --> 00:40:07,240 Speaker 4: We thank you for your service as always, General Arnold Panaro, 753 00:40:07,400 --> 00:40:10,799 Speaker 4: author of the book If Confirmed, An Insider's view of 754 00:40:10,840 --> 00:40:15,000 Speaker 4: the National security confirmation process. You just got your insider's 755 00:40:15,040 --> 00:40:17,000 Speaker 4: view right there, and we'll have to tackle the rest 756 00:40:17,000 --> 00:40:22,160 Speaker 4: of these nominations in the fall. Thanks for listening to 757 00:40:22,200 --> 00:40:25,600 Speaker 4: the Balance of Power podcast. Make sure to subscribe if 758 00:40:25,600 --> 00:40:28,160 Speaker 4: you haven't already, at Apple, Spotify. 759 00:40:27,640 --> 00:40:28,040 Speaker 3: Or wherever. 760 00:40:28,080 --> 00:40:30,680 Speaker 4: You get your podcasts, and you can find us live 761 00:40:30,760 --> 00:40:34,480 Speaker 4: every weekday from Washington, DC at noontime Eastern at Bloomberg 762 00:40:34,600 --> 00:40:35,240 Speaker 4: dot com