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Speaker 1: You're listening to the Bloomberg Sound On podcast. Catch us

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Speaker 1: live weekdays at one Eastern on Bloomberg dot com, the

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Speaker 1: iHeartRadio app and the Bloomberg Business app, or.

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Speaker 2: Listening on demand wherever you get your podcasts.

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Speaker 3: Welcome to the Friday edition of Sound On. I'm Jill

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Speaker 3: Matthew in Washington, where we're balancing a couple of developing

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Speaker 3: stories to the beginning with the debt ceiling debate, whatever

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Speaker 3: we want to call it, negotiations. They're going nowhere fast,

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Speaker 3: it seems. We bring in Bloomberg's Kaylee Lines for an

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Speaker 3: update here an hour early, because Kayleie, we have a

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Speaker 3: pretty important update here today. Republican negotiators walked away from

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Speaker 3: the negotiating table this morning.

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Speaker 4: What do we know, Yeah, well, of course these negotiators

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Speaker 4: are being led by Congressman Garrett Graves on the speaker side,

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Speaker 4: And basically what we know is he walked out of

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Speaker 4: that closed door meeting and said that the White House

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Speaker 4: negotiators were being unreasonable and he said, unless they are

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Speaker 4: willing to have reasonable conversations about how you can actually

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Speaker 4: move forward and do the right thing, We're not going

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Speaker 4: to sit here and talk to ourselves. He went on

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Speaker 4: to say that he didn't know if they were going

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Speaker 4: to meet again later today or even this weekend, and

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Speaker 4: this really just kind of throws a wrench into that

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Speaker 4: whole timeline. Speaker McCarthy himself was laying out just yesterday

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Speaker 4: the idea that this deal could be done in principle

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Speaker 4: by the end of this weekend and on the floor

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Speaker 4: of the House of Representatives by next week. If the

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Speaker 4: negotiators aren't even talking and may not talk for the

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Speaker 4: next several days, clearly progress isn't as progressive as maybe

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Speaker 4: we thought.

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Speaker 2: Not.

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Speaker 3: Speaker McCarthy, the headline on the terminal telling reporters lack

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Speaker 3: of movement by the White House is the reason for

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Speaker 3: the pause. Of course, this could just be posturing or

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Speaker 3: trying to use the public sphere to pressure one side

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Speaker 3: or the other, because the White House knows and Speaker

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Speaker 3: McCarthy does too, if they're going to need some Democrats

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Speaker 3: to vote for this.

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Speaker 4: Thing, they are, and that really has been one of

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Speaker 4: the questions we've been exploring. Of course, show over the

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Speaker 4: last really weak this idea that there are some in

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Speaker 4: the Democratic Party that do not like some of the

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Speaker 4: measures that President Biden has allowed to be left on

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Speaker 4: the table this idea of stricter work requirements for entitlements. Yes,

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Speaker 4: he doesn't want to touch those tide to health benefits

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Speaker 4: like Medicaid, but leaving open SNAP, for example, is something

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Speaker 4: that aggressives. Those in the Congressional Black Caucus had really

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Speaker 4: said they would not vote for a deal that included it,

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Speaker 4: So that may be an area of contention. Maybe the

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Speaker 4: size and scope of these spending caps. Ultimately, for how

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Speaker 4: long into the future you're going to raise the debt ceiling?

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Speaker 4: Are we talking twenty twenty five? Do those in the

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Speaker 4: Publican party want it sooner? These are going to be

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Speaker 4: the issues that we're trying to flesh out. But I

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Speaker 4: would just note Joe that as these headlines are flying

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Speaker 4: thick and fast, it is one pm Eastern time, meaning

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Speaker 4: it is two in the morning in Japan, where President

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Speaker 4: Biden currently is. I would imagine he's asleep in bed

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Speaker 4: right now, unless someone's come and woken him up to

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Speaker 4: let him know what's going on.

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Speaker 3: Yeah, I don't know, but look, you and I have

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Speaker 3: talked to a number of representatives to your point.

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Speaker 1: Just this week.

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Speaker 3: Hailey Stevens of Michigan Jennifer McClellan of Virginia yesterday non

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Speaker 3: starter on the work requirement of anything. In addition is

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Speaker 3: a no vote. So this is really about straddling the

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Speaker 3: line here, yeah, or maybe threadling threading the needle is

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Speaker 3: a better cliche for me to reach for.

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Speaker 4: Well, and that's on the Democratic side. Then you have

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Speaker 4: to consider the reason why you need Democrats in the

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Speaker 4: first places, because you're probably going to lose some Republican side.

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Speaker 4: On the Republican side if you're Speaker McCarthy, because he

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Speaker 4: had to make a lot of promises, put a lot

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Speaker 4: in the bill to get it passed. When he did

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Speaker 4: so with the minimum two hundred and seventeen votes that

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Speaker 4: he needed, he has this very narrow majority, and the

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Speaker 4: House Freedom Caucus yesterday put out a statement saying there

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Speaker 4: should be no more negotiating until the Senate passes the

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Speaker 4: bill that the House did. So it also raises the

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Speaker 4: question of how much of what we're seeing take shape

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Speaker 4: today is also messaging not just to the White House,

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Speaker 4: but to the Republican Caucus like don't worry, we're not

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Speaker 4: rolling over that easily. We're still playing this tough. Because again,

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Speaker 4: there's two sides that have to come in line here.

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Speaker 4: It strikes me, Joe that the edges of each party

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Speaker 4: seem like they're straying further from the idea of compromise,

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Speaker 4: just as those negotiating are trying to work their way

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Speaker 4: towards it.

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Speaker 3: Why, Lord, I'll tell you what. The news conference Sunday

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Speaker 3: night with President Biden is going to be lively or

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Speaker 3: at least interesting. We might learn really what's going on

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Speaker 3: because we may not have a lot of updates over

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Speaker 3: the weekend.

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Speaker 4: Yeah, that's very true.

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Speaker 3: Great work, Kayley, Thank you so much, Kaylee. Lines will

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Speaker 3: be back, of course next hour, as always here Onloomberg's

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Speaker 3: Sound On, and we turned to our other developing story

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Speaker 3: here with Nick Wattams, Bloomberg's National security reporter with a

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Speaker 3: big breaker. In fact, this was our lead story until

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Speaker 3: everybody walked out of the Republicans did at least a

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Speaker 3: little while ago on the debt ceiling. This is a

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Speaker 3: really fascinating Nick, welcome back. We've talked so much about

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Speaker 3: fighter jets and Ukraine, and I recall our conversation with Urisk,

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Speaker 3: the advisor to the Defense Ministry in Ukraine. He was

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Speaker 3: with us back in April, coming on Bloomberg to beg

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Speaker 3: for F sixteens. He said, this is the difference maker.

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Speaker 3: The administration continued to say no, and it looks like

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Speaker 3: we're following a pattern in which they eventually say yes.

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Speaker 5: Yeah.

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Speaker 6: I mean, it's just extraordinary because it's now happened so

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Speaker 6: many times. I mean, you had a situation early on

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Speaker 6: where the US didn't want to provide shoulder fired missiles.

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Speaker 6: Then the big one was the Patriot Missile Defense System,

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Speaker 6: then Abrams tanks, and now here we are with F sixteens.

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Speaker 6: And what's happened is Joe Biden said, hey, we are

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Speaker 6: now fine with the idea of European country Rea's training

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Speaker 6: Ukrainian pilots on the F sixteen. The US has to

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Speaker 6: grant that permission, and then also we indicated the US

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Speaker 6: will grant permission for other countries to send F sixteens

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Speaker 6: to Ukraine. It's a real morale booster for Ukraine because

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Speaker 6: the F sixteen is so much better than anything that

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Speaker 6: Russia has, and it's just sort of for Ukraine or

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Speaker 6: real symbol of a longer term US and Allied commitment

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Speaker 6: because it's going to take so many months to train

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Speaker 6: these pilots. I mean at least six months I think

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Speaker 6: by some estimates, which would suggest, you know, that there's

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Speaker 6: going to be steadfast Allied support, well beyond what we

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Speaker 6: expect to be a counter offensive by Ukraine this summer.

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Speaker 3: Make an important distinction, though, these are not going to

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Speaker 3: be American F sixteens. We're just green lighting European F

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Speaker 3: sixteens for Ukraine. Yurisaka said they wanted forty. Is that number?

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Speaker 6: I think, you know, that's well within the range of possibility.

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Speaker 6: There was a report in the last few days suggesting

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Speaker 6: that they're about one hundred and twenty five of these

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Speaker 6: banging around Europe. I mean, what's actually happening is that

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Speaker 6: some European countries are retiring their fleet of F sixteens

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Speaker 6: because they want the F thirty five. They're getting the

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Speaker 6: F thirty five, more advanced fighter jet from the United States,

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Speaker 6: so they're going to be decommissioning them. That does raise

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Speaker 6: some questions because obviously these are older planes that are

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Speaker 6: going to require a lot of maintenance, a lot of upkeep,

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Speaker 6: and you do get to a question of funding from

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Speaker 6: the US. Presumably it's going to be the US that

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Speaker 6: bears a lot of the burden for that funding, you know,

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Speaker 6: and the US is really banging its head up against

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Speaker 6: the ceiling of funding from Congress, and Congress is going

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Speaker 6: to need to appropriate more funds to pay for a

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Speaker 6: lot of this.

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Speaker 3: I know there are newer versions, there are newer generations

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Speaker 3: of the F sixteen, but this is nineteen sixty seventies

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Speaker 3: technology that we're talking about here. When it comes to

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Speaker 3: the airframe and so forth, you're surprised they're not asking

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Speaker 3: for F thirty fives. Just that's going to be the

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Speaker 3: next one, isn't it?

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Speaker 6: Who knows? I mean, it'll be really interesting to see

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Speaker 6: because this has been the Ukrainian move all along, and

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Speaker 6: they've done it to great effect. They know each every

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Speaker 6: time they get them an advanced weapons system, they ask

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Speaker 6: for the next one, and it has worked very well.

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Speaker 6: But yes, this is an older technology for Ukraine and

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Speaker 6: certainly for Russia because it's meggs and other fighter jets

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Speaker 6: are not nearly as advanced as the F sixteen. But

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Speaker 6: you're going to really start to get into some technology

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Speaker 6: there that the US would not want to fall into

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Speaker 6: Russian hands, or really anybody else's hands. So I think

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Speaker 6: that's a bridge too far at least for this week.

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Speaker 3: We'll check back next week. Great reporting today, Nick, Thank

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Speaker 3: you so much. Nick Wadams, Bloomberg national Security reporter with

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Speaker 3: a se here on Bloomberg Sound On. As we turned

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Speaker 3: to Ambassador Daniel Freed for some insights here, former National

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Speaker 3: Security Senior Director, former Ambassador to Poland, former Assistant Secretary

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Speaker 3: of State for Europe. Mister ambassador, it's great to have

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Speaker 3: you back. How much of this has to do with

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Speaker 3: President Zelenski showing up at the G seven in person?

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Speaker 3: Could Joe Biden not say no to his face?

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Speaker 5: This has been a big and a good day for

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Speaker 5: Ukraine and for American efforts with our European allies in

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Speaker 5: support of Ukraine. A lot of things have happened today.

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Speaker 5: The G seven has announced new sanctions. The US has

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Speaker 5: announced specific sanctions, and it's an extensive and solid list.

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Speaker 5: I'm going through it now and I like what I see.

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Speaker 5: Plus the F sixteen decision. Now, there are two parts

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Speaker 5: to this decision. Is the US will not stand in

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Speaker 5: the way of European countries giving the Ukrainians their F

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Speaker 5: sixteen planes. And the second announcement came just a couple

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Speaker 5: of hours ago, is that the US will help train

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Speaker 5: the Ukrainian pilots on the F sixteens. Now, this is

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Speaker 5: not a US it's not a US led or US

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Speaker 5: only effort. The Dutch, the Belgian, Danes, and the British

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Speaker 5: then involved in this. The Dutch Prime Minister within the

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Speaker 5: hour has just tweeted his appreciation of the US joining.

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Speaker 5: So this is this European group. So what you have

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Speaker 5: here is not the US hanging out all along ahead

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Speaker 5: of our reluctant allies. Sometimes in the case you have

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Speaker 5: the allies actually taking the lead in the US backing

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Speaker 5: them up. That's actually a good signal to send the

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Speaker 5: American people that we're not alone in this. The allies,

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Speaker 5: our European allies, are putting our money in where their

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Speaker 5: mouth is. They're putting in the resources. This is a

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Speaker 5: good thing. Yes, it will take a while to train

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Speaker 5: the Ukrainians, but this war is going to last a while.

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Speaker 5: And the significance of this move, among other things, is

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Speaker 5: that Europe and the United States are not about to

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Speaker 5: give up a Ukraine or push the Ukrainians into a

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Speaker 5: bad negotiation on Putin's terms because we're tired or bored

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Speaker 5: or moved on to something else. This is a What's

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Speaker 5: happened today is the Transatlantic Alliance, the Free World backing

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Speaker 5: up Ukraine as Russia's military offensive fails and as Ukraine

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Speaker 5: gears up for its own counter attacks, which aren't guaranteed

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Speaker 5: to be successful, but they could be. So this is

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Speaker 5: a good day.

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Speaker 3: Well, I'll tell you what. As the former ambassador to Poland,

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Speaker 3: we know Poland provided Ukraine with migjets, but they want

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Speaker 3: something more capable here. And the word from the administration

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Speaker 3: ambassador was that the S sixteen's would be provocative, would

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Speaker 3: somehow escalate the war. We know that Ukraine is now attacking,

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Speaker 3: in some cases Russian positions three hundred miles into the

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Speaker 3: interior of Russia, that this has become more of an

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Speaker 3: offensive a tactic. What changed, because these jets could go

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Speaker 3: all long way to bringing the war to Russia.

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Speaker 5: Well, first of all, Ukraine has not acknowledged a lot

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Speaker 5: of its attack, a lot of these attacks inside Russia.

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Speaker 5: And they have stated also and fairly convincingly, that they're

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Speaker 5: not going to use the US or europe West Europeans

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Speaker 5: supplied or NATO country supplied weapons to do so. But

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Speaker 5: let's remember how Ukraine's at war Russia started this war,

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Speaker 5: and military targets inside Russia are fair game. That's not

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Speaker 5: any violation of the laws of war. But you earlier

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Speaker 5: raised a point, and you've got a point. You said

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Speaker 5: that the Biden administration was reluctant about S sixteen. So well,

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Speaker 5: and before that it was reluctant about tanks, and before

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Speaker 5: that it was reluctant about providing the Ukrainians with long

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Speaker 5: range rocket artillery, and it did so after all prolonged Yeah,

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Speaker 5: they got them all and after a prolonged decision making

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Speaker 5: process US. So you can argue that the administration was

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Speaker 5: too slow. If we had given them the Ukrainians these

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Speaker 5: weapons earlier, the war as outcome would have been different.

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Speaker 5: Or you can argue that the administration was deliberate and

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Speaker 5: careful and that the war is winnable by the Ukrainians.

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Speaker 5: The administration has done a lot. I personally think they

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Speaker 5: could have moved faster. But this is not trivial or

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Speaker 5: marginal assistance. This is a major military logistics operation in

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Speaker 5: which many countries have been involved, Poland, especially Poland's the

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Speaker 5: base for it. The US is the largest contributor. The

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Speaker 5: Germans have come on board. So this is a major

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Speaker 5: Western effort in support of Ukraine, which is fighting for

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Speaker 5: its life and to defend its country against Russian aggression.

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Speaker 3: Do you worry?

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Speaker 5: And this was a good day for that aligned in

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Speaker 5: support of Ukraine.

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Speaker 3: It is a big deal here. Do you worry? Ambassador though,

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Speaker 3: that Russia will attempt to target the transfer of those jets.

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Speaker 3: That was the idea here that whether it's the US

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Speaker 3: or European nations, you put those jets in the air,

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Speaker 3: you put them on a train, or how are the

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Speaker 3: heck they get into Ukraine? That's a target now, now.

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Speaker 5: Sure it is, sure it is. But that same argument

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Speaker 5: has been made with respect to the transfer of every

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Speaker 5: major sophisticated weapon system to Ukraine. So far, the patriots

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Speaker 5: are there, they're being very effective, saving lives of civilians

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Speaker 5: in Keys. Other major weapons systems have gone on and

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Speaker 5: supported the Ukrainian military stopping the Russian offensive, and they

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Speaker 5: may support them in his the Ukrainian military carries out

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Speaker 5: its own offensive, so this strikes me as doable. Of course,

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Speaker 5: the Russians will try to hit them, and they may succeed.

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Speaker 5: This is war, and in war things are unpredictable. But

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Speaker 5: the Ukrainians have shown their ability to manage these transfers.

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Speaker 5: Their operational security seems pretty good, in fact, a lot

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Speaker 5: better than the Russians. This is the right decision. And

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Speaker 5: remember these are not American troops. We're not fighting Ukraine's

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Speaker 5: war for it. We're helping Ukrainians fight their own war.

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Speaker 5: The war was very different from frankly, Afghanistan and Iraq,

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Speaker 5: and President Biden has said strongly, repeatedly and convincedly that

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Speaker 5: Americans are not going to fight Ukraine's war for it,

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Speaker 5: but we're going to help them fight their own and

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Speaker 5: we're doing it.

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Speaker 3: We are doing it. Ambassador, I'm so glad you could

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Speaker 3: join us today. We've talked about the run up to this,

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Speaker 3: and it's actually happening. Daniel Freed, former Ambassador to Poland,

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Speaker 3: now Wiser family distinguished fellow at the Atlantic Council.

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Speaker 1: You're listening to The Bloomberg Sound on podcast. Catch the

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Speaker 1: program live weekdays at one Eastern on Bloomberg Radio, the

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Speaker 1: tune in alf, Bloomberg dot Com, and the Bloomberg Business app.

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Speaker 1: You can also listen live on Amazon Alexa from our

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Speaker 1: flagship New York station, Just say Alexa play Bloomberg eleven thirty.

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Speaker 3: We've talked about the evolution before. It's happened over and

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Speaker 3: over evolution. It's a pattern. When Ukraine asks for something,

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Speaker 3: we say no, that'll never happen. Then a couple of

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Speaker 3: months later they continue begging. There's a call with Zelensky,

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Speaker 3: we say, well, I don't know, look it could be escalatory,

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Speaker 3: and then a couple months after that we deliver the prize.

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Speaker 3: Let's go back to the twenty first of April. The

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Speaker 3: Secretary of Defense, Lloyd Austin, asked about providing fighter jets

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Speaker 3: F sixteen's to Ukraine.

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Speaker 7: Right now, what we all believe is what Ukraine needs

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Speaker 7: most urgently is ground based air defense capability. Okay, that

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Speaker 7: is what has an able them to prevent the Russian

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Speaker 7: air forces from having a meaningful impact in this fight.

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Speaker 3: And that spend the line until now. In fact, at

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Speaker 3: one point the Pentagon said, and jeez, I thought, this

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Speaker 3: is the line everybody was going with. Is that you

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Speaker 3: know it's actually they don't need that. I know they

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Speaker 3: want that, but they don't need that. Strategically, we're giving

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Speaker 3: them what we believe is most effective. We spend time

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Speaker 3: with Yurisak, advisor to the Defense Ministry here on Bloomberg

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Speaker 3: on that same day. This is back in April, making

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Speaker 3: the case we want to.

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Speaker 8: Be successful in liberating our lends and we know that

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Speaker 8: you know, fighter jets F sixteen's, there are more than

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Speaker 8: four thousand of those around the world and we just

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Speaker 8: need forty, so that is less than one percent. And

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Speaker 8: just for understanding, for example, countries such as Pakistan, they

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Speaker 8: have more than eighty. So we are asking half of

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Speaker 8: the fleet of Pakistan. We're not saying that Pakistan should

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Speaker 8: give it to us, but I'm just saying that there

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Speaker 8: are so many of them around the world, and this

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Speaker 8: is why they're so appealing, because they are universal, versatile platforms,

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Speaker 8: and they are widely.

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Speaker 3: On that same day, the answer was no. And here

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Speaker 3: we are on the nineteenth of May, one month later,

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Speaker 3: and the answer is yes, at least if they come

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Speaker 3: from European countries. Let's assemble the panel. We've got a

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Speaker 3: lot to cover here with Rick Davis and Genie Shanzano

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Speaker 3: Bloomberg Politics contributors. Did you see this coming, rerec Did

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Speaker 3: you expect it would eventually happen?

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Speaker 9: Oh?

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Speaker 10: Sure, it's exactly what you just described, Joe. I mean,

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Speaker 10: you know they say no, and then they say yes.

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Speaker 10: They say, you know, they say no to stingers. Yes,

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Speaker 10: it's Patriot batteries. Abraham, thanks, I mean now it's f sixteens.

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Speaker 10: I mean, like, honestly, I don't understand the strategy that

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Speaker 10: this administration has employed. Just give Zelenski what he wants,

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Speaker 10: and he's a one fight in no war and he

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Speaker 10: would know better what he needs. So I don't understand

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Speaker 10: why we seem to be getting in the way of

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Speaker 10: his progress.

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Speaker 3: I wondered, and I asked the ambassador this how important

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Speaker 3: it was to have the Zelensky plan to visit the

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Speaker 3: G seven moves Joe Biden on this, because I think

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Speaker 3: he has a pretty hard time saying no to his face.

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Speaker 9: Genie, Yeah, it would be hard to say no to

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Speaker 9: his face. And I guess we still don't know he's

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Speaker 9: going to be virtual or in person. But if it

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Speaker 9: was in person, I think it'd be his first trip

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Speaker 9: to Asia since the invasion, So that would be a

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Speaker 9: big moment and very hard to say no to his face.

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Speaker 9: But of course, as you just mentioned, this is Groundhog

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Speaker 9: Day all over again. It repeats itself, and the ambassador

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Speaker 9: put it correctly. You know, it's easy to criticize.

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Speaker 5: For too slow.

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Speaker 9: Could have moved faster. I probably agree they could have

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Speaker 9: moved faster, But nobody can accuse this administration of not

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Speaker 9: doing a very good job summoning up the support around

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Speaker 9: the world to combat Russia. And so, yes, they may

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Speaker 9: have been slow on some of this, but I think

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Speaker 9: Joe Biden deserves an awful lot of credit for what

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Speaker 9: he's done to put this together with NATO and our

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Speaker 9: European alley, particularly thinking about the state of our alliances

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Speaker 9: when he took office, which was problematic to say the best.

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Speaker 3: How much of this has to do with the timing

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Speaker 3: of the spring offensive here? Rick? Or is this about

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Speaker 3: banking because we've got months of training involved here? Is

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Speaker 3: this is about banking, you know, potential hardware that could

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Speaker 3: be used to close this conflict, to end this conflict

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Speaker 3: by the end of the year.

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Speaker 10: Yeah, it's hard to tell what's motivated the present to

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Speaker 10: make this announcement. Maybe it's what Genie said, which is

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Speaker 10: I can't look at Zolensky in a face and say

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Speaker 10: no to f sixteens anymore. And if he's common, I

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Speaker 10: better get ahead of it. It would have been nice

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Speaker 10: to have had done this last summer and actually have

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Speaker 10: people prepared now to fill the skies with F sixteens

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Speaker 10: in a spring offensive. But it's hard to tell why

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Speaker 10: this timing makes sense. Again, it's almost like we have

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Speaker 10: a strategy to prolong the war rather than end it.

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Speaker 3: How about that this is obviously a major conversation for

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Speaker 3: the Group of seven leaders. They're talking about ways to

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Speaker 3: ratchet up pressure on Russia. Today, Genie and the Ambassador

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Speaker 3: made the point this is coupled with additional sanctions, which

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Speaker 3: is something we haven't talked about in a long time.

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Speaker 3: The story has been that Russia is doing a pretty

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Speaker 3: darn good job evading the sanctions, finding ways to keep

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Speaker 3: its economy moving, in many cases by selling oil on

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Speaker 3: the black market. Will this new round have any impact?

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Speaker 1: You know?

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Speaker 9: So far, it obviously hasn't achieved the ultimate goal, which

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Speaker 9: is to change behavior set sanctions seldom work that way historically.

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Speaker 9: But these sanctions are critically important, you know. Just as

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Speaker 9: an example, they have put in a new series of

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Speaker 9: sanctions to starve Russia of technology it needs to battle Ukraine.

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Speaker 9: That's critically important, and that they've already done some of that.

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Speaker 9: You're doing more of that we've seen, you know, efforts

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Speaker 9: to your point to tighten sanctioned loopholes so Russia can't

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Speaker 9: use third countries, third parties, in other words, to avoid sanctions.

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Speaker 9: So all of these are going to be critically important.

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Speaker 9: They have made it more difficult for Russia to do

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Speaker 9: what it wants to do visa the Ukraine. So I

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Speaker 9: think these are critically important. I'm not sure they ever

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Speaker 9: have the goal of you know, changing behavior, changing minds,

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Speaker 9: but certainly the fact that they have something about thirteen

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Speaker 9: different categories going into sorry, three hundred categories going into

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Speaker 9: place after this meeting is a big step forward.

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Speaker 3: Leaders issued a statement after their session on Ukraine rick

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Speaker 3: and appeared to take a stand against a cease fire

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Speaker 3: proposal by China. I found this fascinating. Of course, China

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Speaker 3: sent a special envoy to Ukraine earlier this week. Quote.

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Speaker 3: We underline that just a just piece cannot be realized

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Speaker 3: without the complete and unconditional withdrawal of Russian troops and

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Speaker 3: military equipment. This must be included in any call for peace.

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Speaker 3: So is China done here?

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Speaker 10: Yeah?

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Speaker 2: Sure?

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Speaker 10: I mean, like that China twelve point proposal was dead

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Speaker 10: on arrival, right, I mean it basically freezes Ukraine in

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Speaker 10: control of a third of the you know, or Russian

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Speaker 10: control a third of ukraine territory. That's total non starter.

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Speaker 10: They act as if both parties are equally vulnerable or

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Speaker 10: responsible for this war, which is a misunderstanding of what

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Speaker 10: happened here. But they can't insult their buddy Vladimir Putin.

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Speaker 10: So even though I think it's a good thing that,

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Speaker 10: you know, China keeps talking about peace and they're willing

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Speaker 10: to put people in the meetings, and or is that

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Speaker 10: it's it's it's not a realistic option at this point

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Speaker 10: in time, and they should not be given too much

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Speaker 10: credit for their efforts.

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Speaker 3: An unconditional withdraw though Genie would that would not come

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Speaker 3: without Ukraine actually beating Russia on the battlefield. Right, That

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Speaker 3: means you won the war. That's not part of a piece.

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Speaker 2: Deal, that's right.

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Speaker 9: And you know, we should also mention where is jijinping Ben?

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Speaker 9: While the G seven is going forward, he's been at

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Speaker 9: a summit of Central Asian countries, the former Soviet republics,

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Speaker 9: where they continue to deepen tie. This goes back ten

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Speaker 9: years now to the belt and Rowed initiative. So he

435
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Speaker 9: too while I agree with the ambassador a very good

436
00:22:40,680 --> 00:22:43,720
Speaker 9: day vis a v G. The G seven and Ukraine.

437
00:22:44,280 --> 00:22:46,560
Speaker 9: Not as good of a day in my mind as

438
00:22:46,600 --> 00:22:49,679
Speaker 9: it pertains to confront China. So I do think that

439
00:22:49,760 --> 00:22:52,000
Speaker 9: this is very important as we think not just about

440
00:22:52,080 --> 00:22:54,879
Speaker 9: China's role in the Ukraine War, but also or in

441
00:22:55,000 --> 00:22:57,880
Speaker 9: stopping the war potentially, but also in our ability as

442
00:22:57,920 --> 00:23:00,840
Speaker 9: a wes to confront China. He has been very, very

443
00:23:00,880 --> 00:23:04,320
Speaker 9: active just in the hours during this summit, storing up

444
00:23:04,480 --> 00:23:08,000
Speaker 9: his power, while the president, because of this crisis here,

445
00:23:08,240 --> 00:23:10,040
Speaker 9: is forced to cut his trip in the meeting with

446
00:23:10,080 --> 00:23:11,080
Speaker 9: the quad short.

447
00:23:11,080 --> 00:23:15,040
Speaker 3: Bloomberg's got some great reporting on the plans. The President

448
00:23:15,080 --> 00:23:19,399
Speaker 3: Zelenski here will travel to Hiroshima to join the G

449
00:23:19,520 --> 00:23:21,960
Speaker 3: seven leaders. Will fly on a US military plane to

450
00:23:22,040 --> 00:23:25,000
Speaker 3: Japan after an expected stop in Saudi Arabia's how this

451
00:23:25,040 --> 00:23:28,600
Speaker 3: is working out? A French official later clarified that it

452
00:23:28,640 --> 00:23:32,600
Speaker 3: will fly Zelenski to Hiroshima from the Middle East. The

453
00:23:32,720 --> 00:23:36,600
Speaker 3: US provided the plane to Saudi Arabia. Is this a

454
00:23:36,640 --> 00:23:40,080
Speaker 3: smart move for him as far as showing up in Japan?

455
00:23:40,200 --> 00:23:40,360
Speaker 5: Sure?

456
00:23:40,440 --> 00:23:40,920
Speaker 3: Yeah.

457
00:23:40,960 --> 00:23:46,000
Speaker 10: He is seen as an important figure in the geopolitical stage.

458
00:23:46,400 --> 00:23:51,879
Speaker 10: This topic of Ukraine and the Russian War is number

459
00:23:51,880 --> 00:23:55,400
Speaker 10: one on the agenda with the G seven, and they've

460
00:23:55,400 --> 00:23:58,320
Speaker 10: obviously done a lot, both the sanctions and the announcement

461
00:23:58,359 --> 00:24:03,679
Speaker 10: today on f sixteen, to actually create news around this issue.

462
00:24:03,880 --> 00:24:06,240
Speaker 10: I doubt if there'll be much news as it relates

463
00:24:06,320 --> 00:24:11,399
Speaker 10: to the region in Asia, Southeast Asia, but there certainly

464
00:24:11,440 --> 00:24:14,399
Speaker 10: has a lot of news coming out about Ukraine. So sure,

465
00:24:14,800 --> 00:24:18,200
Speaker 10: he has become a much more traveled individually. He spent

466
00:24:18,240 --> 00:24:20,280
Speaker 10: the first year hunkered down in Key fight in a war.

467
00:24:20,840 --> 00:24:22,840
Speaker 10: The fact that he has the ability to get out

468
00:24:22,880 --> 00:24:27,399
Speaker 10: and move around is good for the Ukraine's efforts to

469
00:24:27,400 --> 00:24:30,480
Speaker 10: try and sustain public support and government support in the

470
00:24:30,480 --> 00:24:33,520
Speaker 10: West for their efforts, which they will continue to need

471
00:24:33,560 --> 00:24:34,480
Speaker 10: for some time to come.

472
00:24:34,640 --> 00:24:37,240
Speaker 3: I've been quite a tour genie in the past week

473
00:24:38,160 --> 00:24:43,400
Speaker 3: Zelensky toward European capital, has went through Berlin, visited the UK.

474
00:24:43,760 --> 00:24:49,679
Speaker 3: Now he's going to Japan. Here he's become a missionary

475
00:24:49,720 --> 00:24:51,720
Speaker 3: in kind of a different sense than he was a

476
00:24:51,800 --> 00:24:54,439
Speaker 3: year ago. While he's kind of fighting the war with

477
00:24:54,480 --> 00:24:57,680
Speaker 3: one hand, he's become a true diplomat in the other,

478
00:24:57,720 --> 00:24:59,560
Speaker 3: hasn't he.

479
00:25:00,119 --> 00:25:02,120
Speaker 9: You know, you just look at the comparison we've got,

480
00:25:02,240 --> 00:25:06,040
Speaker 9: you know, Vladimir Putin rather hold up in the Kremlin,

481
00:25:06,720 --> 00:25:09,719
Speaker 9: we believe, and he hasn't been moving around, you know,

482
00:25:09,960 --> 00:25:12,679
Speaker 9: but a little bit. And you have Zelensky. He is

483
00:25:12,720 --> 00:25:15,320
Speaker 9: off meeting the Arab Summit. Now he heads to the

484
00:25:15,359 --> 00:25:18,120
Speaker 9: G seven. So this is quite a contrast. He has

485
00:25:18,119 --> 00:25:21,479
Speaker 9: positioned himself as a world leader. He has positioned himself

486
00:25:21,520 --> 00:25:25,600
Speaker 9: as somebody who is able to move countries around the world,

487
00:25:26,080 --> 00:25:28,399
Speaker 9: and he is somebody who is willing to talk to

488
00:25:28,520 --> 00:25:31,680
Speaker 9: almost anybody to do what he needs to do, which

489
00:25:31,720 --> 00:25:34,760
Speaker 9: is protect his country. It's quite a contrast with Vladimir Putin,

490
00:25:34,760 --> 00:25:37,200
Speaker 9: who is, you know, something of a hostage over in Russia.

491
00:25:37,240 --> 00:25:40,600
Speaker 1: At this point, you're listening to the Bloomberg Sound on

492
00:25:40,760 --> 00:25:44,320
Speaker 1: podcast Catch us Live weekdays at one Eastern.

493
00:25:44,000 --> 00:25:46,760
Speaker 2: On Bloomberg dot com, the iHeartRadio app.

494
00:25:46,520 --> 00:25:49,480
Speaker 1: And the Bloomberg Business App, or listening on demand wherever

495
00:25:49,520 --> 00:25:50,800
Speaker 1: you get your podcasts.

496
00:25:51,560 --> 00:25:53,879
Speaker 3: So the meeting didn't go so well this morning, you know,

497
00:25:54,119 --> 00:25:58,600
Speaker 3: the Republican negotiators apparently walked out of the room pretty

498
00:25:58,600 --> 00:26:01,040
Speaker 3: early on. We're talking about the debt ceiling here. We

499
00:26:01,080 --> 00:26:04,800
Speaker 3: thought we could be in the throws, the final throws

500
00:26:04,880 --> 00:26:07,679
Speaker 3: of negotiating a deal to be announced this weekend, but

501
00:26:07,720 --> 00:26:10,480
Speaker 3: now we're not so sure. Joining us to talk about

502
00:26:10,480 --> 00:26:14,720
Speaker 3: the latest wrinkle here, Megan Scully Bloomberg, congressional reporter in fact,

503
00:26:14,760 --> 00:26:18,320
Speaker 3: leads our congressional coverage here in the bureau. I'm sure

504
00:26:18,359 --> 00:26:20,360
Speaker 3: you have a more official title than I just use Megan.

505
00:26:20,400 --> 00:26:22,879
Speaker 3: It's great to see you. So we're going to be

506
00:26:22,920 --> 00:26:25,760
Speaker 3: talking about hopefully reality here today because it's really hard

507
00:26:25,800 --> 00:26:28,960
Speaker 3: to tell what is real at this point, and everyone's

508
00:26:29,000 --> 00:26:32,320
Speaker 3: trying to negotiate in the room, through the media, in

509
00:26:32,400 --> 00:26:36,480
Speaker 3: the public sphere. How much of a setback is this

510
00:26:36,880 --> 00:26:40,159
Speaker 3: when Republican negotiators leave the room to say, hey, you

511
00:26:40,160 --> 00:26:42,840
Speaker 3: know what, we're not getting anywhere? We're out. Did they

512
00:26:42,880 --> 00:26:44,480
Speaker 3: wake up this morning with a plan to do that?

513
00:26:45,080 --> 00:26:45,240
Speaker 1: You know?

514
00:26:45,359 --> 00:26:47,560
Speaker 11: So what we're seeing right now is some political theater,

515
00:26:47,760 --> 00:26:51,119
Speaker 11: some dangerous political theater with the economy.

516
00:26:51,280 --> 00:26:53,160
Speaker 6: And it is.

517
00:26:53,400 --> 00:26:56,080
Speaker 11: Certainly a setback when you look at the speaker's optimistic

518
00:26:56,119 --> 00:26:59,960
Speaker 11: comments yesterday when he said he thought he believed that

519
00:27:00,080 --> 00:27:04,159
Speaker 11: House would vote on a deal next week. Now we

520
00:27:04,280 --> 00:27:07,240
Speaker 11: see negotiators they met for just over an hour today.

521
00:27:07,800 --> 00:27:13,040
Speaker 11: The Republicans walked out. They were not happy and there's

522
00:27:13,080 --> 00:27:16,119
Speaker 11: no discussion of when negotiations are going to pick up again.

523
00:27:16,280 --> 00:27:18,120
Speaker 3: And they were supposed to be going through the weekend here.

524
00:27:18,080 --> 00:27:20,520
Speaker 11: Right, Sure, yeah they were. You know, whether they were

525
00:27:20,520 --> 00:27:23,399
Speaker 11: in person or virtual was remained to be seen. But

526
00:27:23,520 --> 00:27:26,440
Speaker 11: now we're hearing maybe no talks at all. McCarthy came

527
00:27:26,440 --> 00:27:28,880
Speaker 11: back to Washington. He wasn't actually in the capital when

528
00:27:28,920 --> 00:27:32,000
Speaker 11: the meeting was happening, but he came back about an

529
00:27:32,040 --> 00:27:35,360
Speaker 11: hour later, and you know, he said the talks need

530
00:27:35,400 --> 00:27:39,000
Speaker 11: to pause, and so that certainly doesn't indicate any.

531
00:27:38,840 --> 00:27:39,879
Speaker 3: Time to pause.

532
00:27:39,960 --> 00:27:42,200
Speaker 11: Megan, Yeah, we're getting awfully close to me.

533
00:27:42,280 --> 00:27:44,360
Speaker 3: I mean, I thought this was already pretty much as

534
00:27:44,400 --> 00:27:47,520
Speaker 3: close as it could get. If what they had forecast happened,

535
00:27:47,520 --> 00:27:50,320
Speaker 3: we would just barely make it to avoid a default.

536
00:27:51,040 --> 00:27:54,760
Speaker 3: Is this going to mean now more more conversations about alternatives,

537
00:27:54,800 --> 00:27:58,560
Speaker 3: either a short term solution or my god, the fourteenth Amendment.

538
00:27:58,600 --> 00:28:01,760
Speaker 3: Don't call Bernie Sanders, but that's what he wants to see.

539
00:28:01,880 --> 00:28:02,040
Speaker 9: You know.

540
00:28:02,160 --> 00:28:04,320
Speaker 11: On our team, we have a saying on the hill

541
00:28:04,359 --> 00:28:08,760
Speaker 11: it's no no, no, no, no yes. So Congress has

542
00:28:08,800 --> 00:28:11,360
Speaker 11: never met a deadline that it doesn't want to run

543
00:28:11,440 --> 00:28:15,840
Speaker 11: up right against. So we are still sort of in

544
00:28:15,880 --> 00:28:18,960
Speaker 11: that area where they have the tiniest bit of breathing room.

545
00:28:19,080 --> 00:28:21,680
Speaker 11: So it's certainly not out of the realm of possibility

546
00:28:21,720 --> 00:28:23,800
Speaker 11: that something could come together quickly here.

547
00:28:24,200 --> 00:28:27,840
Speaker 3: And that's the that's the game that Kevin McCarthy's playing, right,

548
00:28:27,840 --> 00:28:30,359
Speaker 3: if he's not getting what he needs from the White House,

549
00:28:31,000 --> 00:28:33,040
Speaker 3: tell you guys to walk out. Let's not make this

550
00:28:33,200 --> 00:28:35,840
Speaker 3: real easy for them, even knowing that, well, we need

551
00:28:35,880 --> 00:28:37,639
Speaker 3: we do need to arrive at an agreement in the

552
00:28:37,640 --> 00:28:38,440
Speaker 3: next couple of days.

553
00:28:38,520 --> 00:28:41,520
Speaker 11: Yeah, well, I mean, and Democrats aren't really singing kumbaya

554
00:28:41,680 --> 00:28:45,000
Speaker 11: right now either. There's issues on the progressive side with

555
00:28:45,200 --> 00:28:48,440
Speaker 11: work requirements that Republicans are demanding be attached to the deal.

556
00:28:48,680 --> 00:28:51,640
Speaker 3: Good lord, well, I'm glad we've figured how easy this

557
00:28:51,760 --> 00:28:53,840
Speaker 3: was going to be. Come see us the beginning of

558
00:28:53,880 --> 00:28:55,440
Speaker 3: next week so we can talk about where we are.

559
00:28:55,440 --> 00:28:58,600
Speaker 3: Megan Scully, thank you great reporting here at Bloomberg. As

560
00:28:58,600 --> 00:29:02,160
Speaker 3: we reassembled our panel, Rick, Dadavis and Genie Shanzino are

561
00:29:02,200 --> 00:29:03,560
Speaker 3: back with us. Rick, you've been in a lot of

562
00:29:03,640 --> 00:29:06,680
Speaker 3: negotiating sessions like this. Is this to be expected? Somebody

563
00:29:06,760 --> 00:29:08,520
Speaker 3: wakes up and not in the right mood. They say,

564
00:29:08,520 --> 00:29:10,360
Speaker 3: all right, we need to add pressure have them walk

565
00:29:10,400 --> 00:29:10,880
Speaker 3: out today.

566
00:29:11,440 --> 00:29:15,640
Speaker 10: Yeah, it isn't unusual. I would say the stakes are

567
00:29:15,720 --> 00:29:18,840
Speaker 10: higher now than probably at any other time and any

568
00:29:18,840 --> 00:29:22,240
Speaker 10: other negotiation. I mean, legislative calendars can be moved, but

569
00:29:22,400 --> 00:29:25,720
Speaker 10: this one can't. And so I think it adds a

570
00:29:25,720 --> 00:29:29,040
Speaker 10: little bit of drama to the weekend. I know that

571
00:29:29,080 --> 00:29:31,520
Speaker 10: the parties, you got to take them at their word.

572
00:29:32,600 --> 00:29:35,160
Speaker 10: The Speaker is completely committed to getting a deal done.

573
00:29:35,160 --> 00:29:37,800
Speaker 10: The White House is completely committed to getting a deal done.

574
00:29:38,520 --> 00:29:42,080
Speaker 10: Now they just need to act like it. The reality is,

575
00:29:42,120 --> 00:29:44,080
Speaker 10: we know what the parameters of a deal look like.

576
00:29:44,240 --> 00:29:46,960
Speaker 10: Well yeah, and so it must be the devils in

577
00:29:47,000 --> 00:29:50,640
Speaker 10: the details. And it's beyond me what level of detail

578
00:29:52,000 --> 00:29:55,040
Speaker 10: is to the extent that people would walk out. I mean,

579
00:29:55,160 --> 00:29:58,600
Speaker 10: maybe this was a stunt by Graves to try.

580
00:29:58,400 --> 00:30:01,320
Speaker 3: To create a little leverage, but for what, for what purpose,

581
00:30:02,480 --> 00:30:04,719
Speaker 3: particularly when there seemed to be a roadmap? Genie, How

582
00:30:04,720 --> 00:30:07,160
Speaker 3: should the White House respond to this or should it?

583
00:30:09,080 --> 00:30:10,800
Speaker 9: Yeah, I mean I think they're going to have to

584
00:30:10,880 --> 00:30:14,240
Speaker 9: keep negotiating. They have good people in place, so I

585
00:30:14,280 --> 00:30:17,600
Speaker 9: think that's the you know, only response. And you know,

586
00:30:18,040 --> 00:30:19,640
Speaker 9: I think the thing that we all need to think

587
00:30:19,640 --> 00:30:21,880
Speaker 9: about though, is the fact that you know, Meghan calls

588
00:30:21,880 --> 00:30:25,480
Speaker 9: it dangerous political theater, and it is dangerous. If we

589
00:30:25,560 --> 00:30:29,160
Speaker 9: get up to the deadline and something passes, whether short

590
00:30:29,240 --> 00:30:32,760
Speaker 9: term or a you know, long term deal, we still

591
00:30:32,840 --> 00:30:35,479
Speaker 9: do damage to the United States at home and abroad

592
00:30:35,480 --> 00:30:38,120
Speaker 9: in the economy. We saw that in twenty eleven. So

593
00:30:38,560 --> 00:30:42,640
Speaker 9: this sort of gamesmanship that we're seeing is already problematic

594
00:30:42,680 --> 00:30:45,840
Speaker 9: and dangerous and is having negative consequences for all of us.

595
00:30:46,120 --> 00:30:49,000
Speaker 9: And that's the reality. So what can the White House do.

596
00:30:49,120 --> 00:30:52,240
Speaker 9: They have to keep talking, or they have to move

597
00:30:52,240 --> 00:30:54,720
Speaker 9: forward with something like a discharge petition or the fourteenth

598
00:30:54,760 --> 00:30:57,200
Speaker 9: Amendment or one of those other options. But those are

599
00:30:57,200 --> 00:31:00,440
Speaker 9: not easy to achieve either. So this you know, sort

600
00:31:00,480 --> 00:31:02,840
Speaker 9: of game of a political theater and walking out in

601
00:31:02,920 --> 00:31:04,560
Speaker 9: all of these things that's going on right now on

602
00:31:04,600 --> 00:31:09,840
Speaker 9: the Republican side, it's destroying really important aspects of our

603
00:31:09,880 --> 00:31:12,880
Speaker 9: political and economic and social life at home and abroad.

604
00:31:12,960 --> 00:31:15,760
Speaker 9: And I think the seriousness of it should not be discounted.

605
00:31:15,840 --> 00:31:17,400
Speaker 3: Well, you wonder how much this has to do with

606
00:31:17,480 --> 00:31:21,360
Speaker 3: the pushback from Democrats on work requirements. Rick the President's

607
00:31:21,400 --> 00:31:25,160
Speaker 3: losing progressives on this. Alexandria Cossio Cortez says that could

608
00:31:25,160 --> 00:31:28,160
Speaker 3: be one hundred to one hundred and fifty no's by

609
00:31:28,200 --> 00:31:30,360
Speaker 3: Democrats in the House when you look at the Progressive

610
00:31:30,360 --> 00:31:32,800
Speaker 3: Caucus and the others there who are not on board

611
00:31:32,880 --> 00:31:36,680
Speaker 3: with this idea, suggesting that maybe the White House wanted

612
00:31:36,720 --> 00:31:39,760
Speaker 3: to pull back on that idea, and the way Republicans

613
00:31:39,760 --> 00:31:41,800
Speaker 3: can deal with that with very little time to spare

614
00:31:41,880 --> 00:31:45,120
Speaker 3: is to walk out. Does that sound plausible. Yeah.

615
00:31:45,160 --> 00:31:48,120
Speaker 10: The only thing that is kind of the nightmare scenario

616
00:31:48,240 --> 00:31:51,280
Speaker 10: for the White House is that the deal that gets

617
00:31:51,320 --> 00:31:54,680
Speaker 10: passed that raises the detliment is a Republican only deal

618
00:31:55,360 --> 00:31:58,000
Speaker 10: in the House. Then they look like the obstructionists and

619
00:31:58,040 --> 00:32:01,960
Speaker 10: Republicans will get the advantage in the media by saying, look,

620
00:32:02,240 --> 00:32:04,920
Speaker 10: you know, we negotiating good faith. President signed off on

621
00:32:04,920 --> 00:32:07,280
Speaker 10: this deal and none of the Democrats voted for it.

622
00:32:08,120 --> 00:32:11,480
Speaker 10: They have an issue there. I honestly think it's overblown.

623
00:32:11,800 --> 00:32:16,680
Speaker 10: I think the center caucuses on both sides are anxious

624
00:32:16,720 --> 00:32:20,120
Speaker 10: to get a vote on I know that AOC has

625
00:32:20,160 --> 00:32:24,120
Speaker 10: been a notoriously bad vote counter. Every time she threatens

626
00:32:24,120 --> 00:32:26,240
Speaker 10: that she can bring something down, it's you know, six

627
00:32:26,280 --> 00:32:29,480
Speaker 10: to twelve votes on her side. So I don't think

628
00:32:29,600 --> 00:32:33,239
Speaker 10: that's actually something that the Republicans care about. They know

629
00:32:33,280 --> 00:32:34,920
Speaker 10: that if they get a deal, they can deliver the votes.

630
00:32:34,920 --> 00:32:39,240
Speaker 10: They've already done it once, and so yeah, maybe the

631
00:32:39,240 --> 00:32:42,000
Speaker 10: White House is spooked by the Democratic Caucus. They listen

632
00:32:42,040 --> 00:32:45,920
Speaker 10: to the Progressives a lot. They probably shouldn't, But Raschetti's

633
00:32:45,920 --> 00:32:48,719
Speaker 10: a smart political operative and he knows how to manage

634
00:32:48,720 --> 00:32:49,520
Speaker 10: through that process.

635
00:32:50,880 --> 00:32:55,120
Speaker 3: I'll tell you what we're hearing from John Rizzo, the

636
00:32:55,200 --> 00:32:59,560
Speaker 3: former senior spokesperson for the US Treasury, speaking with Bloomberg.

637
00:33:00,400 --> 00:33:03,960
Speaker 3: He says, totally predictable. With this much time left, there

638
00:33:04,000 --> 00:33:06,480
Speaker 3: was always going to be a weekend tempest in a

639
00:33:06,600 --> 00:33:10,280
Speaker 3: teapot when the markets were closed. But they're still open

640
00:33:10,960 --> 00:33:12,960
Speaker 3: and it downs down one hundred points right now. The

641
00:33:13,120 --> 00:33:15,480
Speaker 3: S and P is down single digits. Will be tracking

642
00:33:15,520 --> 00:33:17,520
Speaker 3: markets for you as we move forward. Rick Davis and

643
00:33:17,600 --> 00:33:23,560
Speaker 3: Genie Shanzano stay with us.

644
00:33:24,440 --> 00:33:27,840
Speaker 1: You're listening to the Bloomberg Sound On podcast. Catch the

645
00:33:27,840 --> 00:33:31,720
Speaker 1: program live weekdays at one Eastern on Bloomberg Radio, the

646
00:33:31,800 --> 00:33:33,960
Speaker 1: tune in app, Bloomberg dot Com, and the.

647
00:33:33,920 --> 00:33:35,120
Speaker 2: Bloomberg Business App.

648
00:33:35,280 --> 00:33:38,120
Speaker 1: You can also listen live on Amazon Alexa from our

649
00:33:38,160 --> 00:33:42,640
Speaker 1: flagship New York station. Just say Alexa, play Bloomberg eleven thirty.

650
00:33:43,960 --> 00:33:46,120
Speaker 3: It's gonna be quite a week for politics next week,

651
00:33:46,120 --> 00:33:49,600
Speaker 3: because you know this one wasn't. But seriously, with regard

652
00:33:49,640 --> 00:33:53,360
Speaker 3: to twenty twenty four Monday, Senator Tim Scott set to

653
00:33:53,400 --> 00:33:56,600
Speaker 3: announce his campaign for president. He's pulled the paperwork already.

654
00:33:57,120 --> 00:34:00,320
Speaker 3: And then on Wednesday, Ron DeSantis, after a month of

655
00:34:00,360 --> 00:34:05,840
Speaker 3: speculation and touring the globe waging war with Disney, he

656
00:34:05,960 --> 00:34:08,200
Speaker 3: too will jump into the race. And then we've got

657
00:34:08,200 --> 00:34:11,520
Speaker 3: ourselves something Donald Trump not waiting. Of course, a new

658
00:34:11,600 --> 00:34:15,880
Speaker 3: add up against the Trump campaign is calling Ron de

659
00:34:16,120 --> 00:34:23,200
Speaker 3: sales tax, and this one's creative sales plan. This is real,

660
00:34:23,400 --> 00:34:26,440
Speaker 3: the sales tax here, sales You're a tax.

661
00:34:26,880 --> 00:34:29,000
Speaker 2: Everywhere, sales tax in Congress.

662
00:34:29,280 --> 00:34:33,040
Speaker 3: Ron DeSantis back to national sales. Got like a bobblehead,

663
00:34:33,120 --> 00:34:35,839
Speaker 3: Ron De Santis walking through a farm with all these

664
00:34:35,920 --> 00:34:39,279
Speaker 3: price tags flying. Rick Davis and Jeanie Shanzano can't wait

665
00:34:39,320 --> 00:34:42,640
Speaker 3: for this campaign. And I have to say, Rick from

666
00:34:42,680 --> 00:34:45,880
Speaker 3: the creative department here, this one actually is kind of funny.

667
00:34:45,920 --> 00:34:47,759
Speaker 3: Make them laugh, right, if you make them laugh, they'll

668
00:34:47,760 --> 00:34:48,680
Speaker 3: always remember the ad.

669
00:34:48,840 --> 00:34:52,080
Speaker 10: Yeah, they'll remember this ad. They get the tongues wagon.

670
00:34:52,280 --> 00:34:54,640
Speaker 10: You know, people talking about it and uh, and look,

671
00:34:54,640 --> 00:34:57,279
Speaker 10: it is a vulnerability for Ron de Santis. When he

672
00:34:57,320 --> 00:35:00,000
Speaker 10: was in Congress, he did back you know, a national

673
00:35:00,080 --> 00:35:04,080
Speaker 10: sales tax, which is not really Republican conservative orthodoxy by

674
00:35:04,120 --> 00:35:06,680
Speaker 10: any stretch of the imagination. I can't wait for the

675
00:35:06,719 --> 00:35:10,000
Speaker 10: next one. Ron does social Security cut? I mean no

676
00:35:10,120 --> 00:35:11,520
Speaker 10: telling how entertaining that'll be.

677
00:35:12,200 --> 00:35:14,680
Speaker 3: Yeah, starting your name with duh. I was talking to

678
00:35:14,719 --> 00:35:17,400
Speaker 3: Kaylee Lines a minute ago. Is it's apparently an unfortunate

679
00:35:17,440 --> 00:35:19,760
Speaker 3: place to be when you're running against Donald Trump, Genie.

680
00:35:21,120 --> 00:35:23,680
Speaker 9: That's right, And this is part of thirteen million in

681
00:35:23,760 --> 00:35:26,480
Speaker 9: negative ads Trump has put versus DeSantis. Trump has to

682
00:35:26,480 --> 00:35:28,600
Speaker 9: do nothing about telling people who he is because we

683
00:35:28,640 --> 00:35:31,399
Speaker 9: all know. So it's all focused on DeSantis, who has

684
00:35:31,400 --> 00:35:34,560
Speaker 9: this unfortunate name and that you know, the ad isn't

685
00:35:34,600 --> 00:35:37,960
Speaker 9: exactly factual or accurate, but who cares about that because it.

686
00:35:37,920 --> 00:35:40,800
Speaker 3: Is funny, good, right, make him laugh, that's the idea.

687
00:35:41,440 --> 00:35:43,160
Speaker 3: So you guys are going to be with us for

688
00:35:43,600 --> 00:35:46,160
Speaker 3: some pretty big stuff next week, and deeply curious to

689
00:35:46,200 --> 00:35:48,360
Speaker 3: hear your thoughts. As Tim Scott enters the fray, and

690
00:35:48,360 --> 00:35:51,280
Speaker 3: then of course Ron DeSantis makes it official. Rick Davis

691
00:35:51,320 --> 00:35:54,840
Speaker 3: and Genie Shanzo have a great weekend. We're going to

692
00:35:54,920 --> 00:35:56,759
Speaker 3: have to have a vote at some point and we'll

693
00:35:56,760 --> 00:36:00,560
Speaker 3: do a Twitter poll on which was the best nickname

694
00:36:01,920 --> 00:36:04,040
Speaker 3: for Ronda Santis. We'll see what he's got up his

695
00:36:04,120 --> 00:36:05,680
Speaker 3: sleeve as well. Next week.

696
00:36:06,320 --> 00:36:09,839
Speaker 1: You're listening to the Bloomberg Sound On podcast. Catch us

697
00:36:09,880 --> 00:36:13,040
Speaker 1: live weekdays at one Eastern on Bloomberg dot com, the

698
00:36:13,120 --> 00:36:16,360
Speaker 1: iHeartRadio app and the Bloomberg Business app, or listening.

699
00:36:16,120 --> 00:36:18,239
Speaker 2: On demand wherever you get your podcasts.

700
00:36:19,560 --> 00:36:22,319
Speaker 3: We're live from Washington and Kaylee Lines has joined us

701
00:36:22,440 --> 00:36:24,560
Speaker 3: once again. It says deja vu for you. Thank you

702
00:36:24,600 --> 00:36:27,600
Speaker 3: for popping in last hour, because well, we've got some

703
00:36:27,680 --> 00:36:29,920
Speaker 3: breaking news here. It's just hard to tell what exactly

704
00:36:30,000 --> 00:36:32,239
Speaker 3: is serious right now with the debt negotiations. But when

705
00:36:32,239 --> 00:36:35,320
Speaker 3: there's so little time involved, everything is news. And today

706
00:36:35,360 --> 00:36:37,840
Speaker 3: you have negotiators on the Republican side walking out of

707
00:36:37,840 --> 00:36:41,920
Speaker 3: the room, Kayley, and a president who's literally in the

708
00:36:41,960 --> 00:36:46,040
Speaker 3: middle of likely sleeping. Yeah, considering the time difference in Japan.

709
00:36:46,320 --> 00:36:49,000
Speaker 4: Yeah, when these headlines first started crossing, it was after

710
00:36:49,120 --> 00:36:53,880
Speaker 4: midnight in Hiroshima where the president is Therefore, is he

711
00:36:53,960 --> 00:36:55,759
Speaker 4: aware of all of this going down at the moment,

712
00:36:55,840 --> 00:36:57,320
Speaker 4: I don't know. I don't know if this is something

713
00:36:57,320 --> 00:36:59,919
Speaker 4: that you go wake up the President to tell him about.

714
00:37:00,120 --> 00:37:01,840
Speaker 4: But we have been getting statements out of the White

715
00:37:01,840 --> 00:37:05,000
Speaker 4: House in response, just basically admitting that these talks are

716
00:37:05,040 --> 00:37:07,319
Speaker 4: going to be difficult, that the two sides have some

717
00:37:07,440 --> 00:37:09,560
Speaker 4: work to do. And of course what the Republicans are

718
00:37:09,560 --> 00:37:12,480
Speaker 4: messaging today is that it is the White House's fault,

719
00:37:12,520 --> 00:37:14,840
Speaker 4: Speaker McCarthy saying they need to see movement from the

720
00:37:14,840 --> 00:37:16,880
Speaker 4: White House. They aren't seeing it, so they had to pause.

721
00:37:17,080 --> 00:37:19,239
Speaker 4: And of course Congressman Garrett Graves, who is his chief

722
00:37:19,280 --> 00:37:22,120
Speaker 4: negotiator now on this issue, saying that they were being

723
00:37:22,200 --> 00:37:25,080
Speaker 4: unreasonable and therefore he didn't know if they were going

724
00:37:25,080 --> 00:37:27,560
Speaker 4: to keep talking today or even over the weekend. And

725
00:37:27,600 --> 00:37:31,799
Speaker 4: this throws the entire timeline into question, because it's May nineteenth, Joe,

726
00:37:31,960 --> 00:37:33,799
Speaker 4: or less than two weeks away from June first, And.

727
00:37:33,760 --> 00:37:35,799
Speaker 3: This is when the downgrade happened in twenty eleven. It

728
00:37:35,840 --> 00:37:39,200
Speaker 3: was right about two weeks before the X date, and

729
00:37:39,239 --> 00:37:42,600
Speaker 3: they had already come to terms on a deal by then, Kaylee,

730
00:37:42,600 --> 00:37:45,240
Speaker 3: which is why we're a little concerned here. The market

731
00:37:45,280 --> 00:37:48,840
Speaker 3: reaction seems to be fairly contained. I mean, it's not

732
00:37:48,920 --> 00:37:50,880
Speaker 3: a great day on the markets, but the now isn't

733
00:37:51,200 --> 00:37:53,560
Speaker 3: doing anything out of the ordinary here. The S and

734
00:37:53,560 --> 00:37:56,319
Speaker 3: P five hundred is down twelve points right now. It's

735
00:37:56,320 --> 00:37:58,360
Speaker 3: certainly not an end of the world scenario for the market.

736
00:37:58,400 --> 00:38:01,080
Speaker 4: No, nothing's falling out of bed. And tell these headlines

737
00:38:01,120 --> 00:38:03,000
Speaker 4: Cross we were looking at a day in which stocks

738
00:38:03,000 --> 00:38:03,839
Speaker 4: were higher and then.

739
00:38:03,719 --> 00:38:05,840
Speaker 3: They felt the sessions very story.

740
00:38:06,080 --> 00:38:09,359
Speaker 4: Yes, so it definitely is has having an impact. But Joe,

741
00:38:09,360 --> 00:38:12,200
Speaker 4: as you and I have discussed so many times now,

742
00:38:12,440 --> 00:38:15,840
Speaker 4: the market really seems to not believe that there is

743
00:38:15,880 --> 00:38:19,279
Speaker 4: a real risk of defaulting, at least the equity market does.

744
00:38:19,320 --> 00:38:20,960
Speaker 4: They want to believe that we've done this song and

745
00:38:21,040 --> 00:38:24,000
Speaker 4: dance many times before. It has always ended up okay,

746
00:38:24,040 --> 00:38:27,239
Speaker 4: even if there was a downgrade involved twelve years ago.

747
00:38:27,520 --> 00:38:30,719
Speaker 4: But that has been the belief. It's a forward looking mechanism,

748
00:38:30,719 --> 00:38:32,759
Speaker 4: and they think there's going to be a deal done.

749
00:38:32,800 --> 00:38:35,520
Speaker 4: Obviously in the treasury market, specifically in some of that

750
00:38:35,520 --> 00:38:37,719
Speaker 4: short term paper, those tea bills that mature in June,

751
00:38:37,760 --> 00:38:39,799
Speaker 4: you've seen a lot of that anst but on a

752
00:38:39,800 --> 00:38:43,040
Speaker 4: headline level for the broader market. I think they still believe,

753
00:38:43,160 --> 00:38:46,120
Speaker 4: maybe that this is just negotiations playing out in public,

754
00:38:46,120 --> 00:38:48,040
Speaker 4: a lot of posture and going on, a deal is

755
00:38:48,040 --> 00:38:48,799
Speaker 4: still going to get done.

756
00:38:48,880 --> 00:38:50,920
Speaker 3: Yeah, well, I'll tell you that could be a dangerous

757
00:38:50,920 --> 00:38:54,240
Speaker 3: assumption here. Yeah, this week closer, But I thought everyone

758
00:38:54,320 --> 00:38:57,880
Speaker 3: knew that Washington was dysfunctional. We're really we're really making okay,

759
00:38:57,960 --> 00:38:58,759
Speaker 3: We're going to give them the.

760
00:38:58,680 --> 00:39:00,520
Speaker 4: Best disapproved time and time again.

761
00:39:00,600 --> 00:39:03,040
Speaker 3: Oh my god. Of course the G seven is something

762
00:39:03,080 --> 00:39:05,160
Speaker 3: that we're following closely here as well. We've got a

763
00:39:05,200 --> 00:39:09,600
Speaker 3: few plates that we're spinning today with G seven leaders

764
00:39:09,680 --> 00:39:13,160
Speaker 3: set to meet once again on I guess this is

765
00:39:13,239 --> 00:39:17,120
Speaker 3: day two now, and even President Zelenski were reporting is

766
00:39:17,160 --> 00:39:21,000
Speaker 3: going to attend in person here. China has been really

767
00:39:21,080 --> 00:39:25,440
Speaker 3: hanging over this whole gathering and Russia of course, Kayley,

768
00:39:25,520 --> 00:39:28,319
Speaker 3: but we know that China is very closely watching the

769
00:39:28,400 --> 00:39:31,040
Speaker 3: situation in Ukraine, and the stuff that we saw today

770
00:39:31,040 --> 00:39:34,040
Speaker 3: at the Ukraine meeting was pretty remarkable. Another round of

771
00:39:34,080 --> 00:39:37,840
Speaker 3: sanctions green light for F sixteen jetson President she is

772
00:39:37,920 --> 00:39:41,480
Speaker 3: learning as he's watching with Taiwan in mind, and there's

773
00:39:41,520 --> 00:39:44,200
Speaker 3: news there too, the US and Taiwan agreeing to boost

774
00:39:44,239 --> 00:39:49,239
Speaker 3: trade ties, an important initiative announced initially last year, but

775
00:39:49,320 --> 00:39:54,239
Speaker 3: this expands it despite vehement opposition from Beijing. So we

776
00:39:54,280 --> 00:39:56,279
Speaker 3: wanted to get into this with Craig Singletons. But in

777
00:39:56,320 --> 00:39:58,120
Speaker 3: a while since we've had a chance to talk to Craig,

778
00:39:58,160 --> 00:40:02,920
Speaker 3: senior fellow at the Foundation for the Defense of Democracies. Craig, welcome.

779
00:40:03,360 --> 00:40:05,960
Speaker 3: How closely is President she watching this G seven?

780
00:40:06,840 --> 00:40:08,560
Speaker 12: Well, thanks so much for having me. I mean, he

781
00:40:09,200 --> 00:40:11,600
Speaker 12: is obviously wanting to know what's going on there. China

782
00:40:11,640 --> 00:40:14,719
Speaker 12: increasingly views the G seven as a forum aim that

783
00:40:14,960 --> 00:40:18,400
Speaker 12: encircling China and sort of blunting its great power ambitions.

784
00:40:18,800 --> 00:40:20,920
Speaker 12: But even as the world leaders, you know, the world's

785
00:40:20,960 --> 00:40:23,719
Speaker 12: leading democracies meet in Hiroshima, China, it's hosting its own

786
00:40:23,800 --> 00:40:25,719
Speaker 12: gathering this week. You know, it's rolling out the red

787
00:40:25,760 --> 00:40:29,319
Speaker 12: carpet for the first ever China Central Asia Summit, which

788
00:40:29,440 --> 00:40:32,640
Speaker 12: China has sort of billed as its first major diplomatic

789
00:40:32,680 --> 00:40:36,040
Speaker 12: activity of the year and an opportunity to draw a

790
00:40:36,120 --> 00:40:39,320
Speaker 12: new blueprint in the region. And so I think China's

791
00:40:39,360 --> 00:40:41,480
Speaker 12: really trying to say, hey, we're building out this alternate

792
00:40:41,480 --> 00:40:45,799
Speaker 12: international architecture, one that doesn't include the world's leading democracies

793
00:40:45,800 --> 00:40:47,880
Speaker 12: of the United States, and that we're going to deepen

794
00:40:47,920 --> 00:40:52,400
Speaker 12: our political influence and our access throughout these really resource

795
00:40:53,080 --> 00:40:55,799
Speaker 12: rich regions. And so I think as we sort of

796
00:40:55,840 --> 00:40:59,080
Speaker 12: watch what's happening in Hiroshima, there is this alternate story

797
00:40:59,160 --> 00:41:02,839
Speaker 12: of what China is doing to promote an international architecture

798
00:41:02,880 --> 00:41:06,400
Speaker 12: that like sort of really rejects universal values, and like

799
00:41:06,440 --> 00:41:09,400
Speaker 12: I said, it excludes the United States, and it's just

800
00:41:09,440 --> 00:41:11,720
Speaker 12: a threat that G seven can no longer enhorse.

801
00:41:12,360 --> 00:41:14,880
Speaker 4: Well, and of course the President is attending this G

802
00:41:14,960 --> 00:41:17,239
Speaker 4: seven meeting. He went to Japan. He will be there

803
00:41:17,320 --> 00:41:20,760
Speaker 4: leaving Sunday, but he isn't going to the second planned

804
00:41:20,800 --> 00:41:22,560
Speaker 4: part of his trip. He was supposed to go to

805
00:41:22,560 --> 00:41:24,719
Speaker 4: Australia and Papua New Guinea. And at the time when

806
00:41:24,760 --> 00:41:26,440
Speaker 4: he announced he was going to Papua New Guinea, all

807
00:41:26,440 --> 00:41:27,879
Speaker 4: of us here in the newsroom we're kind of looking

808
00:41:27,920 --> 00:41:29,840
Speaker 4: at each other like, really, is he just going to

809
00:41:29,880 --> 00:41:32,480
Speaker 4: be the first president that goes. But we understand there

810
00:41:32,480 --> 00:41:36,400
Speaker 4: really is strategic importance to that country, given its location

811
00:41:36,520 --> 00:41:39,480
Speaker 4: in particular, and of course the importance of the Quad

812
00:41:39,520 --> 00:41:43,040
Speaker 4: which will now be meeting in Japan in replacement of

813
00:41:43,080 --> 00:41:45,239
Speaker 4: the meeting that was supposed to take place in Australia.

814
00:41:45,239 --> 00:41:47,680
Speaker 4: But is there consequence Craig to the second leg of

815
00:41:47,719 --> 00:41:48,799
Speaker 4: this trip not being made.

816
00:41:49,680 --> 00:41:52,720
Speaker 12: Yeah, it's a huge blow, I think to Asia watchers.

817
00:41:52,719 --> 00:41:55,920
Speaker 12: You know, the reasoning behind Biden's plastmunic cancelation is obviously,

818
00:41:56,160 --> 00:41:59,520
Speaker 12: I think understandable, even if some folks, even like myself,

819
00:41:59,560 --> 00:42:03,120
Speaker 12: hear that Washington maybe falling back into old patterns of neglects.

820
00:42:03,160 --> 00:42:06,840
Speaker 12: I mean, remember President Bush, Clinton, and Obama, they all

821
00:42:06,880 --> 00:42:09,239
Speaker 12: pulled out of diplomatic trips to Asia because of so

822
00:42:09,280 --> 00:42:13,880
Speaker 12: called domestic crises. President Trump infamously skipped a summit in

823
00:42:13,920 --> 00:42:17,000
Speaker 12: the Philippines in twenty seventeen. So China has sort of

824
00:42:17,040 --> 00:42:21,120
Speaker 12: long parroted this idea that democratic governance is dysfunctional. You know,

825
00:42:21,200 --> 00:42:25,920
Speaker 12: Beijing's broader strategy aims to alter global perceptions about Chinese

826
00:42:25,960 --> 00:42:30,440
Speaker 12: autocracy and Western democracy in ways that are advantageous to China.

827
00:42:30,560 --> 00:42:33,360
Speaker 12: So they're going to make messaging hey of the cancelation

828
00:42:33,560 --> 00:42:37,880
Speaker 12: and the ongoing debt crisis to undermine Washington's reputation as

829
00:42:37,920 --> 00:42:41,320
Speaker 12: a responsible global stakeholder. And so you know, the sooner

830
00:42:41,360 --> 00:42:43,879
Speaker 12: the debt crisis can be resolved, I think the better

831
00:42:43,960 --> 00:42:46,600
Speaker 12: for Washington's credibility. But the White House is really going

832
00:42:46,640 --> 00:42:49,160
Speaker 12: to need to think about how they sort of recover

833
00:42:49,239 --> 00:42:52,000
Speaker 12: from this, whether they host regional leaders at the White

834
00:42:52,000 --> 00:42:54,759
Speaker 12: House sometime soon, whether they reschedule his trip to the

835
00:42:54,800 --> 00:42:58,319
Speaker 12: Pacific Islands, and so far this you know, it sounds

836
00:42:58,320 --> 00:43:00,920
Speaker 12: like they're going to deploy Secretary of State Anthony Blincoln there.

837
00:43:00,920 --> 00:43:03,080
Speaker 12: But I think what everyone is really looking for is

838
00:43:03,120 --> 00:43:05,680
Speaker 12: a presidential show of leadership in this region that is

839
00:43:05,920 --> 00:43:08,439
Speaker 12: just incredibly vital as we think about this renewed era

840
00:43:08,600 --> 00:43:09,600
Speaker 12: create power competition.

841
00:43:10,000 --> 00:43:13,120
Speaker 3: Interesting statement coming out of the G seven Craig. They

842
00:43:13,120 --> 00:43:15,719
Speaker 3: held a session on Ukraine earlier, as I mentioned, and

843
00:43:15,760 --> 00:43:21,080
Speaker 3: reiterated their quote firm rejection of Russia's illegal attempts to

844
00:43:21,120 --> 00:43:25,240
Speaker 3: acquire Ukrainian territory by force, but went on to check China,

845
00:43:25,880 --> 00:43:28,640
Speaker 3: which of course be sent a special envoy to Ukraine

846
00:43:28,680 --> 00:43:32,360
Speaker 3: earlier this week. Quote we underline a just peace cannot

847
00:43:32,400 --> 00:43:35,600
Speaker 3: be realized without the complete and unconditional withdrawal of Russian

848
00:43:35,600 --> 00:43:38,719
Speaker 3: troops and military equipment, and this must be included in

849
00:43:38,800 --> 00:43:45,240
Speaker 3: any call for peace, essentially rejecting China's attempts to find

850
00:43:45,360 --> 00:43:48,680
Speaker 3: a cease fire in Ukraine. Is China now out of

851
00:43:48,719 --> 00:43:51,920
Speaker 3: the business of finding peace in Ukraine? Following this meeting?

852
00:43:52,840 --> 00:43:54,919
Speaker 12: I mean, I think the Japanese Prime Minister went even

853
00:43:54,960 --> 00:43:57,800
Speaker 12: further by saying, you know, Ukraine today may be East

854
00:43:57,840 --> 00:44:01,720
Speaker 12: Asia tomorrow. I think the notion that the G seven

855
00:44:01,719 --> 00:44:05,440
Speaker 12: agenda was more or less explicitly focus on countering, you know,

856
00:44:05,520 --> 00:44:08,640
Speaker 12: Chinese economic aggression or Chinese activity in these parts of

857
00:44:08,680 --> 00:44:12,520
Speaker 12: the world is It's sort of unfathomable that it would

858
00:44:12,560 --> 00:44:14,279
Speaker 12: not have occurred a few years ago, and yet here

859
00:44:14,280 --> 00:44:14,680
Speaker 12: we are.

860
00:44:14,760 --> 00:44:14,920
Speaker 1: You know.

861
00:44:15,760 --> 00:44:18,799
Speaker 12: Part of the impetus for this tetonic policy shift has

862
00:44:18,840 --> 00:44:21,400
Speaker 12: to do with China using its economic power to like

863
00:44:21,560 --> 00:44:25,360
Speaker 12: fully smaller countries that act against its political interests, and

864
00:44:25,400 --> 00:44:28,239
Speaker 12: so so much of this conversation in Hiroshima it's going

865
00:44:28,320 --> 00:44:32,000
Speaker 12: to focus on diversifying supply chains away from China and

866
00:44:32,080 --> 00:44:34,960
Speaker 12: really starting to see whether the G seven countries can

867
00:44:35,000 --> 00:44:37,880
Speaker 12: come together on some sort of a broader framework of

868
00:44:38,000 --> 00:44:40,200
Speaker 12: how they themselves are going to deal with China, and

869
00:44:40,200 --> 00:44:43,600
Speaker 12: then trying to expand that framework to include other like

870
00:44:43,640 --> 00:44:46,600
Speaker 12: minded countries. But the real question, I think really is

871
00:44:46,680 --> 00:44:49,160
Speaker 12: how far is the G seven willing to go on

872
00:44:49,200 --> 00:44:52,919
Speaker 12: the China front. Germany's expressed a lot of concern about

873
00:44:52,960 --> 00:44:56,880
Speaker 12: investment screening, so is Japan. It's really if they're all

874
00:44:56,960 --> 00:44:59,960
Speaker 12: united on Russia, it's a lot cloudier on China.

875
00:45:00,320 --> 00:45:01,880
Speaker 4: I'm so glad you brought that up, because that was

876
00:45:01,920 --> 00:45:03,920
Speaker 4: literally the next question I wanted to ask, is we

877
00:45:03,920 --> 00:45:07,840
Speaker 4: have seen such unification among the G seven and broadly

878
00:45:07,880 --> 00:45:10,160
Speaker 4: the Western allies when it comes to the Ukraine issue,

879
00:45:10,280 --> 00:45:14,040
Speaker 4: willingness to put pressure on Russia. I just wonder if

880
00:45:14,080 --> 00:45:17,080
Speaker 4: it's more fractured on the China. On the China question,

881
00:45:17,239 --> 00:45:20,040
Speaker 4: given the economic reliance that, of course the US has

882
00:45:20,080 --> 00:45:22,279
Speaker 4: on that country, but Europe is heavily dependent on it

883
00:45:22,320 --> 00:45:25,520
Speaker 4: in terms of trade as well. Obviously there are you know,

884
00:45:25,600 --> 00:45:28,640
Speaker 4: literally location of security concerns for some of the Asian

885
00:45:29,400 --> 00:45:33,200
Speaker 4: allies in question. So does China know that?

886
00:45:33,560 --> 00:45:39,279
Speaker 12: Greg Absolutely. They call it weaponized interdependence, and the key

887
00:45:39,320 --> 00:45:41,440
Speaker 12: part of their strategy is they start to think about

888
00:45:41,600 --> 00:45:45,320
Speaker 12: how they can wield that leverage to constrain decision making

889
00:45:45,360 --> 00:45:47,880
Speaker 12: in Washington and Brussels and other parts of the world.

890
00:45:48,239 --> 00:45:50,239
Speaker 12: I mean, you're right, the G seven nations have shown

891
00:45:50,239 --> 00:45:54,320
Speaker 12: that's remarkable resilience in maintaining a united front against Russia.

892
00:45:54,560 --> 00:45:57,440
Speaker 12: The newly announced sanctions and export controls overnight, I think

893
00:45:57,480 --> 00:46:00,600
Speaker 12: are evidence of that. But the cohesions a lot murkier

894
00:46:00,640 --> 00:46:04,000
Speaker 12: when it comes to developing a calibrated and coordinated response

895
00:46:04,080 --> 00:46:07,560
Speaker 12: to what is an increasingly assertive China and the threat

896
00:46:07,640 --> 00:46:11,319
Speaker 12: China poses to global stability and economic security at the

897
00:46:11,480 --> 00:46:13,440
Speaker 12: very time right that the world is already sort of

898
00:46:13,480 --> 00:46:16,239
Speaker 12: shaken by Moscow's invasion, and so I think G seven

899
00:46:16,280 --> 00:46:19,440
Speaker 12: leaders they seem keen to not let this opportunity go

900
00:46:19,520 --> 00:46:21,239
Speaker 12: to waste, and they're going to focus a lot of

901
00:46:21,280 --> 00:46:26,120
Speaker 12: their conversation on reducing reliance on Chinese manufacturing and sort

902
00:46:26,160 --> 00:46:29,040
Speaker 12: of helping their own companies compete in a new energy economy.

903
00:46:29,360 --> 00:46:32,280
Speaker 12: But it is notable that China is on the agenda,

904
00:46:32,400 --> 00:46:35,920
Speaker 12: and I really feel that we're sort of feeling maybe

905
00:46:35,920 --> 00:46:37,719
Speaker 12: this is sort of fright, but like it does feel

906
00:46:37,719 --> 00:46:39,680
Speaker 12: a little bit like a watershed moment, a critical junk

907
00:46:39,880 --> 00:46:41,240
Speaker 12: juncture for Asia followers.

908
00:46:41,680 --> 00:46:44,080
Speaker 3: Well, that says something coming from you. We're spending time

909
00:46:44,120 --> 00:46:47,640
Speaker 3: with Craig Singleton of the Foundation for the Defense of Democracies.

910
00:46:47,640 --> 00:46:51,120
Speaker 3: There's a meeting just announced as a matter of fact,

911
00:46:52,960 --> 00:46:57,320
Speaker 3: between the Chinese Minister of Commerce and Commerce Secretary Gina Romando.

912
00:46:57,360 --> 00:47:01,160
Speaker 3: Apparently this will happen next week. How important will that

913
00:47:01,200 --> 00:47:01,960
Speaker 3: conversation be.

914
00:47:03,080 --> 00:47:05,400
Speaker 12: I mean, what's so fascinating right is that hu Jinping

915
00:47:05,520 --> 00:47:08,400
Speaker 12: has been ghosting President Biden for six months. You know,

916
00:47:08,440 --> 00:47:11,560
Speaker 12: they last had a conversation back in Bali in November,

917
00:47:11,560 --> 00:47:14,120
Speaker 12: and since then, the Chinese have come up with literally

918
00:47:14,200 --> 00:47:17,240
Speaker 12: every distraction in the book to sort of explain why

919
00:47:17,280 --> 00:47:19,880
Speaker 12: they can't Shi Jing Ping can't pick up to President

920
00:47:19,920 --> 00:47:22,280
Speaker 12: Biden's phone calls. And so I think what we're starting

921
00:47:22,320 --> 00:47:24,720
Speaker 12: to see to hear is this development of a Chinese

922
00:47:24,719 --> 00:47:28,080
Speaker 12: strategy where they say, we are most reliant on the

923
00:47:28,200 --> 00:47:31,720
Speaker 12: United States in the West for access to capital markets

924
00:47:31,719 --> 00:47:34,200
Speaker 12: and for critical technologies. And so the Chinese are going

925
00:47:34,280 --> 00:47:38,360
Speaker 12: to focus their engagement on Secretary Raymundo, and I suspect

926
00:47:38,400 --> 00:47:41,400
Speaker 12: Secretary Yellen, and they're probably going to push back on

927
00:47:41,480 --> 00:47:44,600
Speaker 12: trips by for example, Secretary b Lincoln, thinking we don't

928
00:47:44,640 --> 00:47:46,160
Speaker 12: really need to speak to him. What's sort of the

929
00:47:46,160 --> 00:47:48,880
Speaker 12: benefit of these engagements, And they're going to do everything

930
00:47:48,880 --> 00:47:53,040
Speaker 12: in their power to sort of weaponize these channels such

931
00:47:53,080 --> 00:47:55,319
Speaker 12: that it looks as if the US is willing to

932
00:47:55,400 --> 00:48:00,200
Speaker 12: hold fire from taking specific steps against the Chinese, all

933
00:48:00,280 --> 00:48:04,680
Speaker 12: in exchange for potentially that next President Biden she phone

934
00:48:04,680 --> 00:48:08,040
Speaker 12: call and perhaps choosing pain flying out the San Francisco

935
00:48:08,080 --> 00:48:10,959
Speaker 12: this fall for the APEX conference. So it is part

936
00:48:10,960 --> 00:48:14,520
Speaker 12: of a very concerted strategy the Chinese are employing, and

937
00:48:14,600 --> 00:48:16,160
Speaker 12: at some point soon we sort of have to think

938
00:48:16,200 --> 00:48:20,200
Speaker 12: about whether we are perhaps enabling and sort of accommodating

939
00:48:20,239 --> 00:48:22,640
Speaker 12: Chinese behavior and whether we need to shift from this

940
00:48:23,000 --> 00:48:26,560
Speaker 12: guardrails competitive coexistence approach to this White House is sort

941
00:48:26,560 --> 00:48:30,560
Speaker 12: of employed and embrace to saying like firm reciprocity, We'll

942
00:48:30,560 --> 00:48:32,120
Speaker 12: meet with you, but you also have to meet with

943
00:48:32,200 --> 00:48:34,080
Speaker 12: us on the topics that we want to talk about.

944
00:48:34,400 --> 00:48:37,120
Speaker 4: Well, there is a question of the optics of that.

945
00:48:37,320 --> 00:48:40,680
Speaker 4: Just last week, Congressman Mike Gallagher, who is the chair

946
00:48:40,719 --> 00:48:43,920
Speaker 4: of the China Select Committee in the House, was quoted

947
00:48:43,920 --> 00:48:46,239
Speaker 4: as saying that he doesn't understand the sort of desperation

948
00:48:46,360 --> 00:48:48,240
Speaker 4: to have a meeting and what he called the ardent

949
00:48:48,400 --> 00:48:52,399
Speaker 4: suitor behavior that the Biden administration is exhibiting. He said

950
00:48:52,440 --> 00:48:55,000
Speaker 4: he thinks it creates a lot of confusion in terms

951
00:48:55,080 --> 00:48:58,080
Speaker 4: of our overall strategies. So Craig. Why is it important

952
00:48:58,440 --> 00:49:00,840
Speaker 4: to have these sit downs visible ones?

953
00:49:02,040 --> 00:49:03,920
Speaker 12: I mean, I think the Chinese have even come out

954
00:49:03,920 --> 00:49:06,560
Speaker 12: though and said that, you know, engagement for engagement sake

955
00:49:06,640 --> 00:49:09,160
Speaker 12: isn't really going to be our policy going forward, which

956
00:49:09,160 --> 00:49:11,279
Speaker 12: I think is as diplomatic as you can get for

957
00:49:11,440 --> 00:49:13,600
Speaker 12: you know, don't call us and we may not even

958
00:49:13,680 --> 00:49:17,040
Speaker 12: call you. It's the bigger challenge, right is the Biden administration,

959
00:49:17,160 --> 00:49:19,560
Speaker 12: in my assessment, doesn't actually have a China policy. It

960
00:49:19,600 --> 00:49:22,440
Speaker 12: has several, and they all sort of conflict with one another.

961
00:49:23,160 --> 00:49:25,720
Speaker 12: I think the big challenge, right is that President Biden

962
00:49:25,800 --> 00:49:28,520
Speaker 12: has never actually delivered a speech outlining his vision for

963
00:49:28,600 --> 00:49:31,600
Speaker 12: US China relations, and so he's helped sourced this messaging

964
00:49:31,920 --> 00:49:36,279
Speaker 12: to other officials Secretary of State, Commerce, Treasury, others. So

965
00:49:36,360 --> 00:49:39,080
Speaker 12: they all approach it right from their own parochial perch,

966
00:49:39,160 --> 00:49:42,360
Speaker 12: and so the result has been the deeply fractured policy

967
00:49:42,400 --> 00:49:46,960
Speaker 12: making process that produces contradictory pronouncements, which, in my view,

968
00:49:46,960 --> 00:49:49,040
Speaker 12: more often than not sort of contribute to a sense

969
00:49:49,080 --> 00:49:51,200
Speaker 12: of confusion rather than clarity. And I think it's just

970
00:49:51,320 --> 00:49:55,279
Speaker 12: very frustrating, particularly for members of Congress who are sitting

971
00:49:55,320 --> 00:49:57,800
Speaker 12: here and saying like what exactly is our China policy

972
00:49:57,840 --> 00:50:00,920
Speaker 12: and where are we going? You know, competition is a means,

973
00:50:00,960 --> 00:50:03,839
Speaker 12: not an end, so what is our desired end date

974
00:50:03,960 --> 00:50:07,080
Speaker 12: with China? And so far it's really been a lot

975
00:50:07,160 --> 00:50:08,960
Speaker 12: more showed than tell from this administration.

976
00:50:09,960 --> 00:50:11,960
Speaker 3: Thanks for helping us understand what's going on the other

977
00:50:12,000 --> 00:50:14,160
Speaker 3: side of the world. Once again, Craig Singleton. Great to

978
00:50:14,160 --> 00:50:16,360
Speaker 3: have you back, Greg Senior fellow at the Foundation for

979
00:50:16,400 --> 00:50:24,400
Speaker 3: the Defensive Democracies. Thanks for listening to the Sound On podcast.

980
00:50:24,440 --> 00:50:27,560
Speaker 3: Make sure to subscribe if you haven't already, at Apple, Spotify,

981
00:50:27,640 --> 00:50:30,080
Speaker 3: and anywhere else you get your podcasts, and you can

982
00:50:30,080 --> 00:50:33,080
Speaker 3: find us live every weekday from Washington, DC at one

983
00:50:33,120 --> 00:50:37,080
Speaker 3: pm Eastern Time at Bloomberg dot com.