1 00:00:01,960 --> 00:00:06,240 Speaker 1: Live from our nation's capital. This is Bloomberg Sound On. 2 00:00:07,360 --> 00:00:10,400 Speaker 1: When you have such a slim majority, it means that 3 00:00:10,440 --> 00:00:13,840 Speaker 1: there's going to be compromises. One way to draw more 4 00:00:13,920 --> 00:00:16,920 Speaker 1: people into the workforce and to draw them in productively 5 00:00:17,160 --> 00:00:20,720 Speaker 1: is to pay them a higher way. Schloomberg Sound On, Politics, 6 00:00:20,800 --> 00:00:25,120 Speaker 1: Policy and Perspective from DC's top Name. Inflation is running 7 00:00:25,239 --> 00:00:28,880 Speaker 1: much higher than the Fed projected. There is a monitoring 8 00:00:28,960 --> 00:00:32,000 Speaker 1: system that many big corporations are really contemplating is to 9 00:00:32,080 --> 00:00:34,080 Speaker 1: sort of how do we keep the employees that are 10 00:00:34,120 --> 00:00:39,920 Speaker 1: inside healthy. Schloomberg Sound On with Joe Matthew on Bloomberg Radio. 11 00:00:41,200 --> 00:00:44,840 Speaker 1: We had for a working weekend here in Washington, lawmakers 12 00:00:44,880 --> 00:00:48,839 Speaker 1: inching closer to yet another bipartisan deal on infrastructure. They 13 00:00:48,840 --> 00:00:50,800 Speaker 1: hope to have it done, they say by early next week. 14 00:00:51,640 --> 00:00:53,920 Speaker 1: We're watching Monday very closely. We're going to talk about 15 00:00:53,920 --> 00:00:57,080 Speaker 1: it next with Congressman Kevin Brady, Republican from Texas, who 16 00:00:57,120 --> 00:01:00,280 Speaker 1: says there are red lines for the House o P 17 00:01:00,440 --> 00:01:02,960 Speaker 1: when it comes to infrastructure. Will look at what those 18 00:01:02,960 --> 00:01:04,759 Speaker 1: are and ask him as well if this week's OPEC 19 00:01:04,840 --> 00:01:08,520 Speaker 1: deal will keep shale drilling quiet this year in Texas. 20 00:01:08,600 --> 00:01:12,200 Speaker 1: Later we'll tackle new sanctions from China with James Lewis 21 00:01:12,200 --> 00:01:15,399 Speaker 1: of the Center for Strategic and International Studies. Thanks for 22 00:01:15,440 --> 00:01:17,800 Speaker 1: meeting us here at the threshold of the weekend, even 23 00:01:17,840 --> 00:01:20,559 Speaker 1: though at least some people will again be working through 24 00:01:20,640 --> 00:01:23,959 Speaker 1: the weekend around here, namely the group of senators negotiating 25 00:01:24,000 --> 00:01:29,080 Speaker 1: the infrastructure bill. Spending levels on transit and water remain issues, 26 00:01:29,120 --> 00:01:30,960 Speaker 1: along with well how to pay for it all, and 27 00:01:31,000 --> 00:01:33,880 Speaker 1: we're joined to talk about this and some other important 28 00:01:33,920 --> 00:01:37,680 Speaker 1: issues today with Congressman Kevin Brady, Republican from Texas, who's 29 00:01:37,680 --> 00:01:40,760 Speaker 1: the ranking member on the House Ways and Means Committee. Congressman, 30 00:01:40,800 --> 00:01:44,800 Speaker 1: welcome back to Bloomberg Radio YO. Thanks for having me. 31 00:01:44,840 --> 00:01:47,520 Speaker 1: Appreciate it. Your colleagues in the Senate say we're near 32 00:01:47,560 --> 00:01:51,000 Speaker 1: a deal on infrastructure, will you or other Republicans in 33 00:01:51,000 --> 00:01:54,920 Speaker 1: the House support the plan that Republican senators eventually agree to, 34 00:01:55,000 --> 00:01:58,560 Speaker 1: assuming that happens. Yeah, the short answer is not if 35 00:01:58,600 --> 00:02:01,720 Speaker 1: it is tied the three and a half trillion dollar 36 00:02:02,520 --> 00:02:08,079 Speaker 1: taxing and spending bill um infrastructure itself, I think is 37 00:02:08,120 --> 00:02:12,080 Speaker 1: by Parson. I'm pretty optimistic we can actually find consensus 38 00:02:12,480 --> 00:02:15,880 Speaker 1: on where we should invest in infrastruction. I think there's 39 00:02:15,880 --> 00:02:18,400 Speaker 1: a way to pay for it. No, I'm convinced there's 40 00:02:18,400 --> 00:02:21,640 Speaker 1: a way to pay for it without these cryptan tax increases. 41 00:02:21,680 --> 00:02:24,560 Speaker 1: But for some reason, I think, you know, when Joe 42 00:02:24,560 --> 00:02:29,640 Speaker 1: Biden linked UH the infrastructure bill, and then later Speaker 43 00:02:29,680 --> 00:02:33,320 Speaker 1: Plosi and today Leader Schumer are insisting it be linked, 44 00:02:33,560 --> 00:02:37,520 Speaker 1: you know, that will make it impossible for Republican support, 45 00:02:37,560 --> 00:02:41,040 Speaker 1: because if you link to tax increases to the infrastructure, 46 00:02:41,040 --> 00:02:44,840 Speaker 1: America actually becomes a net loser economically, and it will 47 00:02:44,880 --> 00:02:47,920 Speaker 1: be crippling to the economy. Now paying for it, you 48 00:02:47,960 --> 00:02:49,760 Speaker 1: just put your finger on it. Paying for it has 49 00:02:49,800 --> 00:02:53,440 Speaker 1: been obviously a problem. As ranking member on the Ways 50 00:02:53,440 --> 00:02:55,880 Speaker 1: and Means Committee, I wonder, for starters, did you think 51 00:02:55,880 --> 00:02:58,959 Speaker 1: it was smart or fair to remove funding from I 52 00:02:59,200 --> 00:03:01,440 Speaker 1: R S enforcement that was first put in the plan? 53 00:03:02,680 --> 00:03:04,880 Speaker 1: You know, I think that is a closing the tax 54 00:03:05,320 --> 00:03:08,040 Speaker 1: tax guy is something I think both parties have been 55 00:03:08,040 --> 00:03:13,119 Speaker 1: working on for decades now. It is it is more 56 00:03:13,160 --> 00:03:17,280 Speaker 1: complicated than simply adding more I R S agents. Too, 57 00:03:17,280 --> 00:03:20,040 Speaker 1: if the agency has always admitted that that closes a 58 00:03:20,120 --> 00:03:23,119 Speaker 1: small part of the gap, and and the recent estimates 59 00:03:23,280 --> 00:03:26,480 Speaker 1: prove that there is some money there, but not what 60 00:03:26,560 --> 00:03:30,760 Speaker 1: people believe and so yeah, I think that was probably 61 00:03:30,800 --> 00:03:34,040 Speaker 1: the right decision to make, but but there is still 62 00:03:34,040 --> 00:03:37,640 Speaker 1: a gap, and Republicans we are going to be introducing 63 00:03:37,760 --> 00:03:40,560 Speaker 1: legislation that shows the first thing we need to do 64 00:03:41,000 --> 00:03:44,040 Speaker 1: is a real concrete analysis of that tax cap because 65 00:03:44,400 --> 00:03:48,320 Speaker 1: the information Arrest is using is seven years old, uh, 66 00:03:48,360 --> 00:03:51,080 Speaker 1: and is coupled with a lot of just wild estimates 67 00:03:51,200 --> 00:03:58,200 Speaker 1: on issues like cryptocurrency, foreign transactions issues, concealed income issues 68 00:03:58,240 --> 00:04:01,360 Speaker 1: like that. Let's get a real analysis which will tell 69 00:04:01,440 --> 00:04:03,600 Speaker 1: us what the real solution is. We want to be 70 00:04:03,680 --> 00:04:08,200 Speaker 1: part of that solution. You know, the average person listening says, well, jeez, 71 00:04:08,240 --> 00:04:10,120 Speaker 1: if I don't pay my taxes, I get a lot 72 00:04:10,120 --> 00:04:13,080 Speaker 1: of trouble. How come we shouldn't simply enforce the rules 73 00:04:13,080 --> 00:04:15,440 Speaker 1: on the books. But you're saying that the method is 74 00:04:15,440 --> 00:04:18,560 Speaker 1: is antiquated? Is that right? It really is, and it 75 00:04:18,920 --> 00:04:21,320 Speaker 1: is difficult to determine what it is and where it 76 00:04:21,360 --> 00:04:24,320 Speaker 1: comes from. One thing that's always struck me that the 77 00:04:24,400 --> 00:04:27,320 Speaker 1: many years we've worked with I R S commissioners of 78 00:04:27,400 --> 00:04:30,840 Speaker 1: both parties, is what they will tell you privately is 79 00:04:31,400 --> 00:04:37,960 Speaker 1: what they need on information reporting will be so intrusive 80 00:04:38,120 --> 00:04:45,200 Speaker 1: on families and farmers and local businesses that they've never 81 00:04:45,240 --> 00:04:47,960 Speaker 1: really proposed it because the American people won't stand for 82 00:04:48,040 --> 00:04:52,920 Speaker 1: and I think their recent proposal to force banks to 83 00:04:53,760 --> 00:04:59,520 Speaker 1: report the UH total transactions in your personal bank account 84 00:04:59,600 --> 00:05:02,119 Speaker 1: or your in this bank account and to react strong 85 00:05:02,160 --> 00:05:05,080 Speaker 1: reaction against that is an example. So we've got to 86 00:05:05,120 --> 00:05:06,760 Speaker 1: find a way to do this. But I don't think 87 00:05:06,800 --> 00:05:10,960 Speaker 1: adding forty thou thiles and new I r S agency 88 00:05:11,000 --> 00:05:13,200 Speaker 1: is going to get the job done. So then the 89 00:05:13,240 --> 00:05:17,800 Speaker 1: big question, Congressman, how do we pay for it? Well, look, 90 00:05:17,800 --> 00:05:20,120 Speaker 1: good news is that was only a small part of 91 00:05:20,520 --> 00:05:23,320 Speaker 1: the paid for us for that. UM. They've got a 92 00:05:23,440 --> 00:05:27,080 Speaker 1: laundry list of about a dozen or so, some of 93 00:05:27,120 --> 00:05:31,200 Speaker 1: them more real than others. And I think the finn 94 00:05:31,240 --> 00:05:34,440 Speaker 1: it is trying to work through what our budget gimmicks 95 00:05:34,440 --> 00:05:36,800 Speaker 1: and what are real pay for is UH. There is 96 00:05:37,240 --> 00:05:40,839 Speaker 1: you know, a tax increased super fund UH tax increase 97 00:05:40,960 --> 00:05:43,960 Speaker 1: that hasn't been around for twenty five years. They're putting 98 00:05:44,000 --> 00:05:47,680 Speaker 1: place that's going to have a damaging effect on workers 99 00:05:47,880 --> 00:05:52,039 Speaker 1: in chemical companies and refineries, for example. But I think 100 00:05:52,040 --> 00:05:55,880 Speaker 1: they have the ability to close that that gap on 101 00:05:56,080 --> 00:05:58,320 Speaker 1: funding UH. The I R S was only a small 102 00:05:58,400 --> 00:06:02,000 Speaker 1: part of it. Is the fund inside adequate. We've heard 103 00:06:02,000 --> 00:06:05,320 Speaker 1: complaints by some members, at least those negotiating the deal. Congressman, 104 00:06:05,360 --> 00:06:07,880 Speaker 1: that there's not enough for water, a sanitation, there might 105 00:06:07,880 --> 00:06:11,680 Speaker 1: not be enough for mass transit. According to another you know, 106 00:06:11,720 --> 00:06:17,080 Speaker 1: I think in effect of doubling investments, uh federal investments 107 00:06:17,880 --> 00:06:21,640 Speaker 1: in all that infrastructure and the true infrastructure we're looking 108 00:06:21,680 --> 00:06:25,200 Speaker 1: at um is that he would be the largest increase 109 00:06:25,200 --> 00:06:28,880 Speaker 1: ever frankly in infrastructure comes at a time when you know, 110 00:06:28,960 --> 00:06:31,920 Speaker 1: we hope to get the economy back on track, there'll 111 00:06:31,920 --> 00:06:35,200 Speaker 1: be lots of growth. These investments that think long term 112 00:06:35,279 --> 00:06:38,480 Speaker 1: are very helpful. So yeah, I do think the investments adequate. 113 00:06:38,520 --> 00:06:43,760 Speaker 1: It's a it's it's it's a major surgeon spending. We're 114 00:06:43,760 --> 00:06:46,560 Speaker 1: talking with Congressman Kevin Brady, Republican from Texas here on 115 00:06:46,560 --> 00:06:49,920 Speaker 1: Bloomberg Sound On. It's been a bumpy week for oil, Congressman. 116 00:06:49,960 --> 00:06:52,880 Speaker 1: I'm sure I don't need to tell you. We're stabilizing 117 00:06:52,880 --> 00:06:56,280 Speaker 1: today back above seventy one barrel at least for now, 118 00:06:56,680 --> 00:06:59,520 Speaker 1: but we were below seventy earlier this week. Now that 119 00:06:59,560 --> 00:07:03,240 Speaker 1: OPEC has reached a deal on production, I wonder where 120 00:07:03,279 --> 00:07:05,440 Speaker 1: does that leave shale producers in your stake and they 121 00:07:05,480 --> 00:07:08,039 Speaker 1: afford to drill in this environment or is there no point? 122 00:07:09,040 --> 00:07:11,560 Speaker 1: You know? In short, they can, I think the big 123 00:07:11,760 --> 00:07:16,240 Speaker 1: they've gotten at at sixty and seventy dollars, certainly they 124 00:07:16,280 --> 00:07:20,000 Speaker 1: can and they will, and we're seeing that beginning to reopen. 125 00:07:20,040 --> 00:07:22,840 Speaker 1: I think though, you know, the biggest obstacles we face 126 00:07:23,360 --> 00:07:27,280 Speaker 1: a it's so frustrating to have the administration begging the 127 00:07:27,320 --> 00:07:30,240 Speaker 1: Middle East to open up the faucet when frankly we 128 00:07:30,320 --> 00:07:34,640 Speaker 1: have UH that ability and those resources right here in 129 00:07:34,680 --> 00:07:38,680 Speaker 1: the US. It's also frustrating see the administration working to 130 00:07:38,680 --> 00:07:43,320 Speaker 1: to UH open and forward the Nord Stream Russia Germany 131 00:07:43,400 --> 00:07:47,120 Speaker 1: pipeline while they are blocking ours here in the US. 132 00:07:47,200 --> 00:07:51,160 Speaker 1: And then, of course administrations come up with eleven now 133 00:07:51,200 --> 00:07:57,760 Speaker 1: twelve UH major tax increases that will really dampen production, 134 00:07:58,400 --> 00:08:02,120 Speaker 1: refining UH pipelines here in the United States, and so 135 00:08:02,280 --> 00:08:06,120 Speaker 1: I think they see that overall a sort of attack 136 00:08:06,720 --> 00:08:10,559 Speaker 1: on traditional energy as as I think the biggest challenge 137 00:08:10,680 --> 00:08:13,880 Speaker 1: is going forward. Talking with Congressman Kevin Brady of Texas 138 00:08:13,920 --> 00:08:16,480 Speaker 1: and Texas Instruments has been one of our top stories 139 00:08:16,480 --> 00:08:19,760 Speaker 1: the Earnings Report over the past twenty four hours. Here Congressman. 140 00:08:19,800 --> 00:08:22,840 Speaker 1: They beat estimates, they beat sales and earnings, But there 141 00:08:22,840 --> 00:08:25,040 Speaker 1: are a lot of worries about chips right now. I 142 00:08:25,080 --> 00:08:28,360 Speaker 1: wanted to ask you about this Chips Act that still 143 00:08:28,400 --> 00:08:30,960 Speaker 1: needs to be funded in the House. Would that do 144 00:08:31,160 --> 00:08:33,520 Speaker 1: enough if we we gave say the fifty two billion 145 00:08:33,559 --> 00:08:37,000 Speaker 1: dollars that's in the Senate version to incentivize chip making 146 00:08:37,120 --> 00:08:40,079 Speaker 1: domestically here. Is that the right approach? Should we be 147 00:08:40,120 --> 00:08:42,680 Speaker 1: building foundries here now or is there something else we 148 00:08:42,679 --> 00:08:44,800 Speaker 1: can do that would help to resolve this a lot 149 00:08:44,960 --> 00:08:48,400 Speaker 1: more quickly that would take years to accomplish. Yeah, yes, 150 00:08:48,440 --> 00:08:51,400 Speaker 1: so will I think ultimately we do want UH to 151 00:08:51,520 --> 00:08:55,160 Speaker 1: see more of that manufacturing here in the United States, 152 00:08:54,960 --> 00:08:58,080 Speaker 1: and that is part of the broader up and we 153 00:08:58,200 --> 00:09:01,920 Speaker 1: become we need to become more medically independent from China, 154 00:09:02,480 --> 00:09:05,880 Speaker 1: UH in medical equipment, supplies, the ingredients. We need to 155 00:09:05,880 --> 00:09:08,679 Speaker 1: look at the key technologies, you know, including chips, that 156 00:09:09,240 --> 00:09:12,000 Speaker 1: that those production lines need to be anchored in the 157 00:09:12,120 --> 00:09:16,959 Speaker 1: US and running through reliable, resilient trade partners such as Mexico, 158 00:09:17,120 --> 00:09:20,080 Speaker 1: Canada and others. We think that's that's smart for long 159 00:09:20,200 --> 00:09:22,560 Speaker 1: term questions, how to do it? You know, is this 160 00:09:23,400 --> 00:09:27,840 Speaker 1: a burden for taxpayers that should be undertaken. Is this 161 00:09:27,920 --> 00:09:30,840 Speaker 1: the issue of creating the right tax incentives so that 162 00:09:30,960 --> 00:09:35,840 Speaker 1: government isn't picking which industries in which businesses manufactured, but 163 00:09:35,920 --> 00:09:39,040 Speaker 1: frankly creating the right incentives to anchor that production and 164 00:09:39,120 --> 00:09:41,320 Speaker 1: accelerate here in the US. As you would guess, I 165 00:09:41,400 --> 00:09:45,880 Speaker 1: favored the second approach, and that we've introduced legislation broader 166 00:09:46,240 --> 00:09:49,360 Speaker 1: than just the chips there. Bottom line is we are 167 00:09:49,400 --> 00:09:53,200 Speaker 1: having conversations those of us who write the tax that provisions, 168 00:09:53,320 --> 00:09:57,120 Speaker 1: with leaders like Michael McCall on this issue, and I'm 169 00:09:57,120 --> 00:10:00,320 Speaker 1: hopeful we can find the right solution. Long as the 170 00:10:00,400 --> 00:10:03,920 Speaker 1: Chinese are reportedly hoarding chips in Beijing, you want to 171 00:10:03,960 --> 00:10:07,439 Speaker 1: start hoarding chips in Dallas. Yeah, Well, I'll tell you 172 00:10:07,480 --> 00:10:09,400 Speaker 1: the other thing that worries me is that if the 173 00:10:09,480 --> 00:10:12,760 Speaker 1: government is directing the grants and funding on this bill, 174 00:10:12,840 --> 00:10:16,920 Speaker 1: direct you know what types of chips are manufactured, the 175 00:10:17,040 --> 00:10:20,160 Speaker 1: witch industries they do they go to? As you know, 176 00:10:20,280 --> 00:10:24,480 Speaker 1: government often misses the market, the need to demand. And 177 00:10:24,559 --> 00:10:29,000 Speaker 1: also I do worry about this government down direction on chips. 178 00:10:29,040 --> 00:10:31,680 Speaker 1: I think it's much smarter if we create the right 179 00:10:32,120 --> 00:10:35,040 Speaker 1: tax in cent is and regulatory incent is for them 180 00:10:35,080 --> 00:10:38,199 Speaker 1: to respond to the market, and that works better. Congressman 181 00:10:38,240 --> 00:10:41,280 Speaker 1: Kevin Brady, Republican from Texas, thanks for being with us 182 00:10:41,320 --> 00:10:43,680 Speaker 1: on Bloomberg. Enjoy your weekend in the home district, and 183 00:10:43,679 --> 00:10:46,160 Speaker 1: we'll talk to you once we get a deal. Thank you, Joe. 184 00:10:46,200 --> 00:10:49,680 Speaker 1: Take care as we learn more about the chip shortage 185 00:10:49,679 --> 00:10:53,239 Speaker 1: as well from the new bosson Intel, new CEO relatively 186 00:10:53,280 --> 00:10:57,080 Speaker 1: new pack Gelsinger says we are likely for the worst 187 00:10:57,080 --> 00:11:01,760 Speaker 1: of it, knowing that it's three to four years, he says, 188 00:11:01,840 --> 00:11:05,079 Speaker 1: to build a fab from scratch, a foundry from scratch. 189 00:11:05,640 --> 00:11:08,559 Speaker 1: The dearth of semiconductor's crossed many parts of the industry, though, 190 00:11:08,600 --> 00:11:10,640 Speaker 1: will hit bottom the second half of this year, he 191 00:11:10,679 --> 00:11:17,280 Speaker 1: told Bloomberg Today, and persist as late as still by 192 00:11:17,320 --> 00:11:20,640 Speaker 1: then won't have those new foundries in place. Coming up 193 00:11:20,640 --> 00:11:23,360 Speaker 1: on Bloomberg Radio, will turn all these issues over to 194 00:11:23,440 --> 00:11:27,920 Speaker 1: the panel. Insights today from Bloomberg Congressional reporter Stephen Dennis. 195 00:11:28,240 --> 00:11:32,160 Speaker 1: He will join us next along with Bloomberg Governments Jack Fitzpatrick. 196 00:11:32,240 --> 00:11:34,120 Speaker 1: Will have a lot to talk about as we are 197 00:11:34,200 --> 00:11:36,160 Speaker 1: on the verge of a deal. You just heard Kevin 198 00:11:36,160 --> 00:11:38,640 Speaker 1: Brady get into this a bit highlighting some of the 199 00:11:38,640 --> 00:11:41,520 Speaker 1: red lines that Republicans have and giving us a sense 200 00:11:41,520 --> 00:11:44,480 Speaker 1: of what may or may not be acceptable as a 201 00:11:44,480 --> 00:11:50,000 Speaker 1: actual written document could emerge following this weekend's negotiations. Stay here, 202 00:11:50,080 --> 00:11:53,000 Speaker 1: we'll check traffic next for you and come back as 203 00:11:53,000 --> 00:11:55,640 Speaker 1: well with the panel. I'm Joe Matthew. This is Bloomberg. 204 00:12:13,200 --> 00:12:18,640 Speaker 1: This is Bloomberg. Sound on with Joe Matthew on Bloomberg Radio. 205 00:12:20,480 --> 00:12:23,040 Speaker 1: Hearing how close they are in the Senate to a 206 00:12:23,120 --> 00:12:26,920 Speaker 1: deal on infrastructure, another deal, but after hearing from Congress 207 00:12:26,920 --> 00:12:29,160 Speaker 1: from Brady, you realize there are still some big items 208 00:12:29,160 --> 00:12:33,200 Speaker 1: to negotiate. White House Press Secretary Jen Saki was asked 209 00:12:33,240 --> 00:12:35,880 Speaker 1: about one of them today, spending on transit and whether 210 00:12:35,920 --> 00:12:38,760 Speaker 1: there's a red line there for President Biden. I'm not 211 00:12:38,840 --> 00:12:41,080 Speaker 1: setting red lines here, but we are confident that they 212 00:12:41,120 --> 00:12:44,800 Speaker 1: can work through uh the funding issues and the breakdown 213 00:12:44,840 --> 00:12:48,520 Speaker 1: of funding issues between Democrats and Republicans over the coming days. 214 00:12:48,679 --> 00:12:51,240 Speaker 1: So let's get into it with Bloomberg. Congressional reporter Stephen 215 00:12:51,240 --> 00:12:54,680 Speaker 1: Dennis and Bloomberg Government's Jack Fitzpatrick both joined me in 216 00:12:54,720 --> 00:12:57,040 Speaker 1: studio this Friday. Welcome. It's great to have both of you. 217 00:12:57,559 --> 00:13:00,959 Speaker 1: Stephen lawmaker's sound optimistic, and we talked to them for 218 00:13:01,000 --> 00:13:03,560 Speaker 1: the most part, But how close are we to having 219 00:13:03,559 --> 00:13:06,280 Speaker 1: something on paper? Yeah, I think we're a lot closer 220 00:13:06,320 --> 00:13:09,360 Speaker 1: than we were a few weeks ago. They've resolved a 221 00:13:09,360 --> 00:13:12,400 Speaker 1: lot of the bigger questions, like how they're going to 222 00:13:12,440 --> 00:13:16,040 Speaker 1: pay for this largely, and you know, they got rid 223 00:13:16,080 --> 00:13:19,680 Speaker 1: of some contentious items like ramped up I R S 224 00:13:19,800 --> 00:13:22,560 Speaker 1: tax enforcement and hiring lots and lots of new I 225 00:13:22,679 --> 00:13:26,200 Speaker 1: R S agents, which caused heartburn on the right. Now 226 00:13:26,240 --> 00:13:29,200 Speaker 1: you have heartburn on the left. You have some some 227 00:13:29,320 --> 00:13:33,520 Speaker 1: Democrats who are saying, hey, when they're looking at the 228 00:13:33,559 --> 00:13:36,120 Speaker 1: fine print behind the scenes, saying, look, this is not 229 00:13:36,320 --> 00:13:41,120 Speaker 1: enough of a guarantee that transit's going to get in 230 00:13:41,160 --> 00:13:43,320 Speaker 1: the future years that we want to make sure it 231 00:13:43,360 --> 00:13:46,839 Speaker 1: gets instead of eighteen. Now that sounds like a really 232 00:13:46,880 --> 00:13:51,000 Speaker 1: small discrepancy, but you know, the numbers that they're talking 233 00:13:51,040 --> 00:13:53,840 Speaker 1: about are so big. Here we're talking about billions of dollars. 234 00:13:53,880 --> 00:13:56,240 Speaker 1: It might be the difference between whether or not your 235 00:13:56,280 --> 00:14:00,160 Speaker 1: project in Ohio or General Way gets money or not. Uh. 236 00:14:00,920 --> 00:14:02,640 Speaker 1: It gives you a sense of, you know, what the 237 00:14:02,640 --> 00:14:06,360 Speaker 1: personal priorities are here at this point, Jack, But I 238 00:14:06,400 --> 00:14:10,520 Speaker 1: wonder does anything that does not end up in the 239 00:14:10,559 --> 00:14:13,560 Speaker 1: bipartisan deal end up in reconciliation. In other words, you're 240 00:14:13,559 --> 00:14:15,720 Speaker 1: gonna get it at some point, we're just not sure 241 00:14:15,720 --> 00:14:18,120 Speaker 1: which package it will be in. Well, that's the catch all, 242 00:14:18,200 --> 00:14:20,880 Speaker 1: that three and a half trillion dollar bill that Democrats 243 00:14:20,920 --> 00:14:23,880 Speaker 1: are are going to do. Um. I don't know if 244 00:14:23,920 --> 00:14:27,560 Speaker 1: every single transit priority would necessarily get in there. There's 245 00:14:27,600 --> 00:14:30,320 Speaker 1: a lot left that's up in the air. Really. They've 246 00:14:30,320 --> 00:14:34,720 Speaker 1: described that next reconciliation bill as the human infrastructure one. 247 00:14:34,800 --> 00:14:38,320 Speaker 1: A lot of Biden's proposals that Republicans didn't want to 248 00:14:38,480 --> 00:14:42,600 Speaker 1: try to fit into a quote unquote infrastructure bill. So yeah, 249 00:14:42,600 --> 00:14:46,360 Speaker 1: if you're a Democrat, I think it's hard to argue, oh, 250 00:14:46,480 --> 00:14:48,640 Speaker 1: they're just playing small ball, even if you thought they 251 00:14:48,680 --> 00:14:52,920 Speaker 1: went too small on the infrastructure package, particularly because Speaker 252 00:14:52,920 --> 00:14:57,200 Speaker 1: Pelosi has said she's going to require that next big 253 00:14:57,240 --> 00:14:59,920 Speaker 1: bill before she even allows this infrastructure bill to go. 254 00:15:00,040 --> 00:15:02,000 Speaker 1: But yeah, I mean, when you get into the details, 255 00:15:02,040 --> 00:15:04,680 Speaker 1: some things could fall through and some members could be unhappy, 256 00:15:04,720 --> 00:15:07,119 Speaker 1: and then the margins are so close in both chambers, 257 00:15:06,960 --> 00:15:08,920 Speaker 1: it's it's going to be a challenge. There is kind 258 00:15:08,960 --> 00:15:12,200 Speaker 1: of a gentleman's agreement here between the President. However, in 259 00:15:12,240 --> 00:15:16,600 Speaker 1: these Republican negotiators that whatever subject matter ends up in 260 00:15:16,640 --> 00:15:20,200 Speaker 1: the Biparsan package will not be reopened and added to 261 00:15:20,480 --> 00:15:23,760 Speaker 1: in the reconciliation package, which is why the fight is 262 00:15:23,760 --> 00:15:26,400 Speaker 1: so tough right now. They are holding by that. Well, 263 00:15:26,480 --> 00:15:29,360 Speaker 1: you know, individual senators are not part of that agreement. 264 00:15:29,520 --> 00:15:32,760 Speaker 1: I think Shared Brown told some of our reporters this week, 265 00:15:32,800 --> 00:15:34,400 Speaker 1: you know, I'm not part of that agreement. I could 266 00:15:34,600 --> 00:15:37,520 Speaker 1: keep on trying later on, but you know, I think 267 00:15:37,760 --> 00:15:40,560 Speaker 1: that you know, the White House has been basically talking 268 00:15:40,600 --> 00:15:43,640 Speaker 1: about this is the this infrastructure package. We're gonna have 269 00:15:43,720 --> 00:15:46,520 Speaker 1: a different set of things that we're gonna be having 270 00:15:46,520 --> 00:15:49,960 Speaker 1: that Democratic only package, and so, you know, I think 271 00:15:50,000 --> 00:15:54,400 Speaker 1: that that's causing some heartburn. You have senators who are 272 00:15:54,440 --> 00:15:58,280 Speaker 1: worried that stuff won't be fixed later on. They there's 273 00:15:58,320 --> 00:16:02,080 Speaker 1: no guarantee, so they want to make sure that their 274 00:16:02,160 --> 00:16:04,360 Speaker 1: priorities are are dealt with. One of the things that 275 00:16:04,360 --> 00:16:08,240 Speaker 1: that's been a headache here the last few days is 276 00:16:08,280 --> 00:16:13,160 Speaker 1: whether water and sewer projects will be guaranteed and mandated 277 00:16:13,520 --> 00:16:16,920 Speaker 1: UH funding in this package, or whether they're gonna have 278 00:16:16,960 --> 00:16:19,560 Speaker 1: to keep fighting every year to get the money that 279 00:16:19,680 --> 00:16:22,800 Speaker 1: they want. And that's one of the last little hold 280 00:16:22,880 --> 00:16:26,720 Speaker 1: ups from Senator Carper, who's you know, close to the President, 281 00:16:26,800 --> 00:16:29,640 Speaker 1: has passed a water bill with something like eight six 282 00:16:29,680 --> 00:16:32,080 Speaker 1: eight seven votes out of the Senate. So it's very 283 00:16:32,120 --> 00:16:35,760 Speaker 1: popular item. But you know they're trying to keep it 284 00:16:35,800 --> 00:16:38,240 Speaker 1: to five dred and seventy nine billion dollars and you 285 00:16:38,240 --> 00:16:40,760 Speaker 1: know they've already figured out where they want to spend 286 00:16:40,760 --> 00:16:43,720 Speaker 1: that money. And so if you decide, okay, well I 287 00:16:43,800 --> 00:16:46,480 Speaker 1: want extra over here or extra over there, you have 288 00:16:46,520 --> 00:16:49,280 Speaker 1: to take it from somebody else. And that that's where 289 00:16:49,320 --> 00:16:52,240 Speaker 1: it gets hard in those last moments, that's for sure. 290 00:16:52,280 --> 00:16:55,040 Speaker 1: As we spend time with our panel, Bloomberg Congressional reporter 291 00:16:55,080 --> 00:16:57,920 Speaker 1: Stephen Dennis, and a familiar voice on this program is 292 00:16:57,960 --> 00:17:02,120 Speaker 1: in this chair from time to time, Bloomberg Government's Fitzpatrick. Uh. 293 00:17:02,200 --> 00:17:04,240 Speaker 1: This is going to be the weekend, right, do we both? 294 00:17:04,320 --> 00:17:07,159 Speaker 1: Do you both expect a deal on Monday? Jack? Is 295 00:17:07,160 --> 00:17:10,160 Speaker 1: this going to happen Monday? If not Monday, it sounds 296 00:17:10,200 --> 00:17:12,080 Speaker 1: like they're on track for pretty early next week. I 297 00:17:12,080 --> 00:17:14,959 Speaker 1: think the last thing that Senator Romney had said was 298 00:17:15,000 --> 00:17:18,200 Speaker 1: maybe Monday or Tuesday. I mean, correct me if I'm wrong, Steve, 299 00:17:18,240 --> 00:17:21,119 Speaker 1: But I think the timeline is early next week. And 300 00:17:21,160 --> 00:17:23,359 Speaker 1: we left to see exactly how they put the schedule together. 301 00:17:23,400 --> 00:17:25,680 Speaker 1: But you know that's a pretty fast pace that could 302 00:17:25,680 --> 00:17:27,959 Speaker 1: allow for a vote on Wednesday, right, Yeah, I doubt it. 303 00:17:28,000 --> 00:17:31,119 Speaker 1: I mean I think, you know, Romney was, I was 304 00:17:31,200 --> 00:17:33,639 Speaker 1: thinking it might be early this past week. And and 305 00:17:33,680 --> 00:17:36,360 Speaker 1: the thing is is, uh, you know there's that old 306 00:17:36,359 --> 00:17:38,679 Speaker 1: saying about hard drives. They tend to fill up, you know. 307 00:17:39,480 --> 00:17:44,600 Speaker 1: Uh So the main backdrop here is the August recess. 308 00:17:44,640 --> 00:17:47,240 Speaker 1: Senators want to get out of town and go on 309 00:17:47,280 --> 00:17:51,080 Speaker 1: their vacations or whatever they're gonna do in August, and 310 00:17:51,119 --> 00:17:52,960 Speaker 1: they want to do it on time. Well, that means 311 00:17:53,000 --> 00:17:55,080 Speaker 1: they have two weeks left. You know, they've kind of 312 00:17:55,080 --> 00:17:58,879 Speaker 1: puttered around here for several weeks and chewed up a 313 00:17:58,880 --> 00:18:00,800 Speaker 1: lot of time. Well, time is starting to run out. 314 00:18:00,840 --> 00:18:03,200 Speaker 1: It doesn't run out on Monday, it doesn't run out 315 00:18:03,200 --> 00:18:05,840 Speaker 1: on Tuesday, it doesn't run out Wednesday. But if they 316 00:18:05,880 --> 00:18:09,520 Speaker 1: don't have a deal and earliest next week, you know 317 00:18:09,600 --> 00:18:12,879 Speaker 1: you're staring at Chuck Schumer probably saying next weekend you're 318 00:18:12,880 --> 00:18:15,560 Speaker 1: gonna have to work. You know, we're gonna We're gonna 319 00:18:15,600 --> 00:18:18,040 Speaker 1: have to be here next weekend to pass this thing, 320 00:18:18,520 --> 00:18:21,679 Speaker 1: because then right after that he wants to have the 321 00:18:21,760 --> 00:18:25,160 Speaker 1: Democrats pass a budget resolution, which we still haven't seen 322 00:18:25,160 --> 00:18:28,479 Speaker 1: the details of. He still has to get all fifty 323 00:18:28,520 --> 00:18:31,040 Speaker 1: Democrats to vote for. He still has a huge vote 324 00:18:31,080 --> 00:18:33,840 Speaker 1: Arama before they leave, so there's a lot to do 325 00:18:33,920 --> 00:18:38,360 Speaker 1: on that end. There's also the Capitol Police funding package, 326 00:18:38,400 --> 00:18:40,280 Speaker 1: so there's a lot of other things that they've got 327 00:18:40,280 --> 00:18:42,800 Speaker 1: to get done in the next two weeks. Stephen and Jack, 328 00:18:43,160 --> 00:18:46,160 Speaker 1: stay right where we are. We're gonna wrap this whole 329 00:18:46,160 --> 00:18:48,800 Speaker 1: hour with our panel with a couple of other ideas, 330 00:18:49,160 --> 00:18:53,159 Speaker 1: including China, which will tackle next. US sanctions against Chinese 331 00:18:53,240 --> 00:18:57,480 Speaker 1: officials have resulted in Chinese sanctions against the US. It's 332 00:18:57,520 --> 00:19:05,320 Speaker 1: next broadcasting live from our nation's capital, Bloomberg to New York, 333 00:19:05,400 --> 00:19:10,119 Speaker 1: Bloomberg eleven Frio to San Francisco, Bloomberg nine sixty to 334 00:19:10,200 --> 00:19:14,280 Speaker 1: the country Sirius XM Channel one nineteen, and around the globe, 335 00:19:14,320 --> 00:19:18,240 Speaker 1: the Bloomberg Business app and Bloomberg Radio dot Com. This 336 00:19:18,640 --> 00:19:24,760 Speaker 1: is Bloomberg Sound On with Joe Matthew. The Deputy Secretary 337 00:19:24,800 --> 00:19:28,119 Speaker 1: of State is headed for China. This weekend dispatched by 338 00:19:28,160 --> 00:19:32,119 Speaker 1: the President, and what timing as China just today announces 339 00:19:32,160 --> 00:19:37,399 Speaker 1: retaliatory sanctions following the Biden administration sanctions on Chinese officials 340 00:19:37,840 --> 00:19:40,680 Speaker 1: in Hong Kong, along with the big warning we talked 341 00:19:40,680 --> 00:19:44,320 Speaker 1: about earlier this week. We'll get into the significance of 342 00:19:44,359 --> 00:19:47,119 Speaker 1: this next with James Lewis from the Center for Strategic 343 00:19:47,160 --> 00:19:50,600 Speaker 1: and International Studies here on sound on China pushes back 344 00:19:50,720 --> 00:19:53,439 Speaker 1: on the US with sanctions against a group about a 345 00:19:53,440 --> 00:19:58,679 Speaker 1: half dozen Americans, including former Commerce Secretary Wilburg Ross, in 346 00:19:58,720 --> 00:20:02,520 Speaker 1: response to recent sang on Chinese officials in Hong Kong 347 00:20:02,640 --> 00:20:07,280 Speaker 1: and the Biden administration's warning against Americans doing business there. 348 00:20:07,800 --> 00:20:13,600 Speaker 1: Chinese government is not keeping his commitment made. How would 349 00:20:13,640 --> 00:20:16,680 Speaker 1: it deal with with Hong Kong. We're joined now by 350 00:20:16,760 --> 00:20:20,000 Speaker 1: James Lewis, Senior Vice president and Program director at the 351 00:20:20,000 --> 00:20:23,960 Speaker 1: Center for Strategic and International Studies. James, welcome. The timing 352 00:20:23,960 --> 00:20:27,639 Speaker 1: here is important as Deputy Secretary of State Wendy Sherman 353 00:20:27,680 --> 00:20:30,840 Speaker 1: prepares to visit China in the next several days. Yes, 354 00:20:30,880 --> 00:20:34,480 Speaker 1: and the Chinese are sending a message to that UH. 355 00:20:34,760 --> 00:20:38,879 Speaker 1: Deputy Secretary Sherman should expect the bumpy ride when she 356 00:20:38,960 --> 00:20:42,639 Speaker 1: gets to China. Uh, they are. They're more interested in 357 00:20:42,680 --> 00:20:46,280 Speaker 1: decompanying that we are. So it's it's going to be 358 00:20:46,440 --> 00:20:49,400 Speaker 1: messy and probably get messier. We'll see what she gets 359 00:20:49,400 --> 00:20:51,480 Speaker 1: out of the talks. There are some areas where we 360 00:20:51,520 --> 00:20:54,639 Speaker 1: can cooperate, areas where we're going to be in conflict. 361 00:20:55,040 --> 00:20:57,720 Speaker 1: When you say bumpy ride, are you talking about maybe 362 00:20:57,720 --> 00:20:59,879 Speaker 1: tough meetings that she'll be in or her entire ex 363 00:21:00,040 --> 00:21:03,119 Speaker 1: vurience in China. I think the meetings are going to 364 00:21:03,160 --> 00:21:06,399 Speaker 1: be difficult because the Chinese have no interest in making 365 00:21:06,440 --> 00:21:10,720 Speaker 1: any concessions to the US. They think we're in decline. Uh. 366 00:21:10,840 --> 00:21:13,320 Speaker 1: They're the ones who went to decouple more than we do. 367 00:21:13,600 --> 00:21:18,959 Speaker 1: So Um. Whatever they do outside the meetings, inside the meetings, 368 00:21:19,080 --> 00:21:22,120 Speaker 1: I think it will be a very tough environment. Does 369 00:21:22,160 --> 00:21:24,879 Speaker 1: Wilbur Ross have anything to worry about? Um? And not. 370 00:21:24,960 --> 00:21:27,160 Speaker 1: Unless Wilbur Ross is fun as long as he doesn't 371 00:21:27,200 --> 00:21:30,320 Speaker 1: take any trips to China, I'm not sure he's planning 372 00:21:30,359 --> 00:21:32,879 Speaker 1: to do that. This is it's interesting here, James. The 373 00:21:32,920 --> 00:21:38,440 Speaker 1: sanctions were first imposed under China's new anti foreign sanctioned 374 00:21:38,480 --> 00:21:40,560 Speaker 1: law that was passed just in June. Is this the 375 00:21:40,560 --> 00:21:42,920 Speaker 1: beginning of a new trend. One of the things that 376 00:21:43,040 --> 00:21:47,119 Speaker 1: Chinese have been doing is copying the US. We use sanctions, 377 00:21:47,280 --> 00:21:52,000 Speaker 1: we block foreign investment, we try and block Chinese technology. 378 00:21:52,560 --> 00:21:55,760 Speaker 1: They're basically copying everything we do. It's important for them 379 00:21:55,800 --> 00:21:59,520 Speaker 1: to show they're equal their appear and so, yes, if 380 00:21:59,520 --> 00:22:01,840 Speaker 1: we do thing, expect them to do it back. And 381 00:22:02,640 --> 00:22:06,520 Speaker 1: sanctions on individuals always drove the Chinese wild when we 382 00:22:06,560 --> 00:22:08,760 Speaker 1: did it to them. I'm not sure if we'll get 383 00:22:08,760 --> 00:22:12,040 Speaker 1: the same same effect out of sanctioning Glilberg Ross, but 384 00:22:12,160 --> 00:22:15,320 Speaker 1: they are definitely copying what we do. White House Press 385 00:22:15,359 --> 00:22:18,639 Speaker 1: Secretary Jensaki said today and the briefing that the US 386 00:22:18,880 --> 00:22:23,720 Speaker 1: was undeterred by China's move. Do you believe her? I 387 00:22:23,800 --> 00:22:28,160 Speaker 1: absolutely believe her. This is largely a symbolic action. Wilbert 388 00:22:28,240 --> 00:22:31,080 Speaker 1: Ross has nothing to fear that Chinese want to show 389 00:22:31,480 --> 00:22:34,280 Speaker 1: Americans can't push us around. We can do what they 390 00:22:34,320 --> 00:22:38,600 Speaker 1: do to us. They hate these kind of sanctions on individuals, 391 00:22:39,160 --> 00:22:42,159 Speaker 1: um but it's largely for domestic consumption. It's largely a 392 00:22:42,200 --> 00:22:47,359 Speaker 1: symbolic act. So you know, if they were indicting or 393 00:22:47,680 --> 00:22:50,680 Speaker 1: sanctioning sitting officials, that would be different. And they haven't 394 00:22:50,720 --> 00:22:52,879 Speaker 1: been willing to go that far yet. We're talking with 395 00:22:52,960 --> 00:22:55,800 Speaker 1: James Lewis, Senior vice president program director at the Center 396 00:22:55,800 --> 00:23:00,080 Speaker 1: for Strategic and International Studies. Following the sanctions announced by 397 00:23:00,200 --> 00:23:03,439 Speaker 1: China against a group of Americans, about a half dozen 398 00:23:03,520 --> 00:23:07,800 Speaker 1: of them, including former Secretary Wilbur Ross. James, some of 399 00:23:07,840 --> 00:23:10,440 Speaker 1: the other stuff, we've seen the actions from the Chinese 400 00:23:10,520 --> 00:23:14,080 Speaker 1: against their own companies, essentially with an effort to get 401 00:23:14,119 --> 00:23:17,119 Speaker 1: to American investors. Seen a crackdown on US listings of 402 00:23:17,200 --> 00:23:20,560 Speaker 1: Chinese companies. We've seen them crack down on big tech 403 00:23:21,040 --> 00:23:24,040 Speaker 1: in their own country that is hurt stocks here owned 404 00:23:24,040 --> 00:23:27,600 Speaker 1: by Americans, a d RS owned by Americans. Wouldn't you 405 00:23:27,640 --> 00:23:31,360 Speaker 1: suggest those are much more detrimental, much more meaningful actions 406 00:23:31,400 --> 00:23:35,840 Speaker 1: against the US than these sanctions, sanctions, the moves against 407 00:23:35,880 --> 00:23:39,920 Speaker 1: Chinese companies listing in the United States, the cracked out 408 00:23:39,960 --> 00:23:43,040 Speaker 1: on Chinese tech companies, it's all part of a larger 409 00:23:43,119 --> 00:23:46,960 Speaker 1: effort might has been in she to extend control and 410 00:23:47,040 --> 00:23:50,360 Speaker 1: to push back on what they see as American interference. 411 00:23:50,400 --> 00:23:54,160 Speaker 1: So this is only the start. China wants the decouple 412 00:23:54,240 --> 00:23:58,440 Speaker 1: more than we do. China wants to get the US 413 00:23:58,480 --> 00:24:01,639 Speaker 1: out of its internal affairs, and that might mean UM 414 00:24:01,760 --> 00:24:06,560 Speaker 1: forcing company to list in Shanghai rather than New York. 415 00:24:07,240 --> 00:24:09,639 Speaker 1: Not in the interest of stock owners, not in the 416 00:24:09,680 --> 00:24:12,919 Speaker 1: interest of Chinese companies, but it's in the political interests 417 00:24:12,960 --> 00:24:15,800 Speaker 1: of the Chinese Communist Party. James, getting back to where 418 00:24:15,840 --> 00:24:19,359 Speaker 1: we started this whole conversation, the visit by Deputy Secretary 419 00:24:19,359 --> 00:24:23,480 Speaker 1: of State Wendy Sherman. She'll be leaving this weekend for China. 420 00:24:23,880 --> 00:24:26,600 Speaker 1: What might she accomplish or even try to accomplish, and 421 00:24:26,640 --> 00:24:29,000 Speaker 1: could that lead to a meeting between President she and 422 00:24:29,040 --> 00:24:32,879 Speaker 1: President Biden. The Chinese definitely want to summit. They're a 423 00:24:32,920 --> 00:24:37,080 Speaker 1: little myth that President Biden met with Vladimer Putin and 424 00:24:37,200 --> 00:24:40,320 Speaker 1: not with She. It's you know, there's were a great 425 00:24:40,320 --> 00:24:43,160 Speaker 1: power to why are you ignoring us? So they weren't 426 00:24:43,160 --> 00:24:46,639 Speaker 1: the summit, and that gives the Deputy Secretary Sherman a 427 00:24:46,840 --> 00:24:50,439 Speaker 1: little leverage, not a lot. There's a couple of areas 428 00:24:50,480 --> 00:24:53,480 Speaker 1: where we probably will want to cooperate the Chinese and 429 00:24:53,480 --> 00:24:56,440 Speaker 1: may be willing to do something on climate change. They're 430 00:24:56,480 --> 00:24:59,680 Speaker 1: probably interested in seeing North Korea be a little more stable. 431 00:25:00,119 --> 00:25:02,920 Speaker 1: So there's places where we have some overlap, where there's 432 00:25:02,920 --> 00:25:07,320 Speaker 1: a potential for some progress, but in general, this is 433 00:25:07,320 --> 00:25:10,280 Speaker 1: going to be a tough series of talks. The Chinese 434 00:25:10,320 --> 00:25:14,480 Speaker 1: are going to come in asking Germans confer that they're 435 00:25:14,520 --> 00:25:19,080 Speaker 1: not not only appear, they're actually superior. So they've actually said, 436 00:25:19,520 --> 00:25:24,200 Speaker 1: we want to reinforce America's understanding of China's new position 437 00:25:24,280 --> 00:25:27,439 Speaker 1: in the world, and that means tough stocks of semi 438 00:25:27,520 --> 00:25:33,320 Speaker 1: confessions from the Chinese on trade, on cyber spying, on technology. 439 00:25:33,840 --> 00:25:36,240 Speaker 1: But maybe we can make some progress on Korea and 440 00:25:36,359 --> 00:25:39,520 Speaker 1: climate change, because that's the probably the only two places 441 00:25:39,560 --> 00:25:42,800 Speaker 1: where we have shared interests. James Lewis, Senior vice president, 442 00:25:42,800 --> 00:25:46,040 Speaker 1: program director at the Center for Strategic and International Studies. 443 00:25:46,400 --> 00:25:48,399 Speaker 1: We thank you for your time today on Bloomberg Radio. 444 00:25:50,160 --> 00:25:53,600 Speaker 1: Statement from the Chinese embassy quoted the US, it reads 445 00:25:53,640 --> 00:25:57,840 Speaker 1: has concocted the so called Hong Kong Business Advisory to 446 00:25:57,960 --> 00:26:02,640 Speaker 1: groundlessly smear Hong Kong's busines this environment and illegally imposed 447 00:26:02,640 --> 00:26:05,840 Speaker 1: sanctions on several officials. It goes on to say, in 448 00:26:05,880 --> 00:26:08,520 Speaker 1: response to the uroneous practice on the U S side 449 00:26:08,560 --> 00:26:12,400 Speaker 1: or China's decided to take reciprocal countermeasures unquote. You might 450 00:26:12,400 --> 00:26:15,720 Speaker 1: have heard earlier on Bloomberg Radio. A Bloomberg report that 451 00:26:15,880 --> 00:26:20,400 Speaker 1: the PRC is considering asking tutoring companies there to turn nonprofit. 452 00:26:20,440 --> 00:26:24,520 Speaker 1: It made a mess of stocks in those companies. Tall 453 00:26:24,680 --> 00:26:29,520 Speaker 1: Education groups down over seventy percent today, New Oriental Education 454 00:26:29,560 --> 00:26:34,040 Speaker 1: and Tech Group down over fifty percent, and Chinese A 455 00:26:34,119 --> 00:26:36,600 Speaker 1: d R s we're down hard again. So they Ali 456 00:26:36,680 --> 00:26:41,360 Speaker 1: Baba down four percent, j D down five, ten cent 457 00:26:41,480 --> 00:26:45,000 Speaker 1: down four percent, Pin Duo Duo down seven. I could 458 00:26:45,040 --> 00:26:50,840 Speaker 1: go on. Steep selling and steep losses continue in shares 459 00:26:50,880 --> 00:26:54,239 Speaker 1: of Chinese based companies. Coming up. We'll talk about this 460 00:26:54,320 --> 00:26:57,479 Speaker 1: and what you expect next week here in Washington inside 461 00:26:57,480 --> 00:26:59,720 Speaker 1: the Beltway, with a lot on the line as we 462 00:26:59,840 --> 00:27:04,320 Speaker 1: back Bloomberg Congressional reporter Stephen Dennis and Bloomberg Government's Jack Fitzpatrick. 463 00:27:04,440 --> 00:27:07,960 Speaker 1: Next on Bloomberg sound On, Stay with us. We'll check 464 00:27:08,000 --> 00:27:11,320 Speaker 1: the markets and traffic. Next, I'm Joe Matthew. This is Bloomberg. 465 00:27:19,200 --> 00:27:25,800 Speaker 1: This is Bloomberg. So no with Joe Matthew on Bloomberg Radio. 466 00:27:26,240 --> 00:27:29,280 Speaker 1: Thanks for being with us, and good Friday. Bloomberg sound 467 00:27:29,320 --> 00:27:33,040 Speaker 1: On brought to you by with him forward thinking advisory 468 00:27:33,080 --> 00:27:37,520 Speaker 1: and accounting firm offering industry expertise and innovative solutions for 469 00:27:37,560 --> 00:27:42,520 Speaker 1: your business experience. The withem Way Innovative, Adaptive, effective, trusted. 470 00:27:43,359 --> 00:27:46,600 Speaker 1: Visit with him dot com for more. Next week should 471 00:27:46,600 --> 00:27:48,639 Speaker 1: be one to remember around here in Washington. As the 472 00:27:48,680 --> 00:27:51,200 Speaker 1: Deputy Secretary of State heads for China, we were just 473 00:27:51,240 --> 00:27:55,280 Speaker 1: discussing that with James Lewis. An infrastructure bill was expected 474 00:27:55,320 --> 00:27:58,040 Speaker 1: to emerge from negotiations at some point, and oh, then 475 00:27:58,160 --> 00:28:02,440 Speaker 1: there's the debt ceiling. Who says, nothing ever happens around here. 476 00:28:02,480 --> 00:28:05,399 Speaker 1: It's a good thing we have Bloomberg Government's Jack Fitzpatrick 477 00:28:05,480 --> 00:28:08,879 Speaker 1: with us and Bloomberg Congressional reporter Stephen Dennis as we 478 00:28:09,000 --> 00:28:10,840 Speaker 1: round out the hour. Thanks again to both of you 479 00:28:11,280 --> 00:28:13,399 Speaker 1: for being here. Uh, Jack, I don't know if you 480 00:28:13,480 --> 00:28:16,280 Speaker 1: heard our conversation with James Lewis, but there are deep 481 00:28:16,320 --> 00:28:19,439 Speaker 1: concerns about China on both ends of Pennsylvania Avenue, and 482 00:28:19,520 --> 00:28:23,000 Speaker 1: we've got retaliatory sanctions in place today. Of course, President 483 00:28:23,040 --> 00:28:26,080 Speaker 1: Biden was talking about doing business in Hong Kong and 484 00:28:26,160 --> 00:28:31,359 Speaker 1: implementing sanctions against Chinese officials there just about a week ago. Uh, 485 00:28:31,880 --> 00:28:35,600 Speaker 1: is there a path in Congress to approach what's going 486 00:28:35,640 --> 00:28:37,960 Speaker 1: on in China? Right now or is this really something 487 00:28:38,000 --> 00:28:42,360 Speaker 1: that that the executive is going to be dealing with. Actually, coincidentally, 488 00:28:42,400 --> 00:28:44,840 Speaker 1: a lot of stuff with China's coming up in Congress, 489 00:28:44,880 --> 00:28:48,239 Speaker 1: it's really been under the radar. I think. Actually the 490 00:28:48,360 --> 00:28:50,400 Speaker 1: spending bills that I'm covering that are coming up in 491 00:28:50,400 --> 00:28:54,640 Speaker 1: the House next week are chock full of China. Basically 492 00:28:54,880 --> 00:28:57,880 Speaker 1: every kind of tough on China measure you could have 493 00:28:57,920 --> 00:29:00,800 Speaker 1: added in. Uh. Some of this is messaging stuff. There's 494 00:29:00,840 --> 00:29:03,600 Speaker 1: a ban on any money going to the Wuhan Institute 495 00:29:03,680 --> 00:29:07,160 Speaker 1: Institute of Virology, which you know that funding was frozen anyway, 496 00:29:07,680 --> 00:29:12,160 Speaker 1: There's all sorts of stuff in there focused on military. UH. 497 00:29:12,440 --> 00:29:15,440 Speaker 1: No funds uh to go to anything that would support 498 00:29:15,480 --> 00:29:18,239 Speaker 1: the Belton Road initiative. Congress has taken this up. They 499 00:29:18,240 --> 00:29:20,960 Speaker 1: don't have that executive authority. But when you talk to 500 00:29:21,040 --> 00:29:25,680 Speaker 1: lawmakers about China, UM really both parties now feel the need, 501 00:29:25,720 --> 00:29:28,840 Speaker 1: probably more pushed by Republicans, but Democrats are are largely 502 00:29:28,880 --> 00:29:30,400 Speaker 1: on board with a much more of a tough on 503 00:29:30,520 --> 00:29:33,160 Speaker 1: China approach. And earlier this week we were dealing with 504 00:29:33,240 --> 00:29:37,800 Speaker 1: China recruiting scientists, for instance, from the US. Even it 505 00:29:37,920 --> 00:29:40,440 Speaker 1: is one of those few bipartisan issues, I guess on 506 00:29:40,520 --> 00:29:43,360 Speaker 1: Capitol Hill. Oh yeah, And you know, the Senate's already 507 00:29:43,360 --> 00:29:49,719 Speaker 1: passed this big semiconductor slash China bill aimed at trying 508 00:29:49,760 --> 00:29:53,480 Speaker 1: to bring back some chip plants to the United States. 509 00:29:53,960 --> 00:29:57,480 Speaker 1: You know, Chuck Schumer was in New York touting the 510 00:29:57,560 --> 00:30:01,520 Speaker 1: plans for an expansion of a chip factory there. This 511 00:30:01,600 --> 00:30:05,840 Speaker 1: is uh, something where I think the Republicans saw it 512 00:30:05,880 --> 00:30:08,440 Speaker 1: as something they could run against Biden on in in 513 00:30:08,480 --> 00:30:11,400 Speaker 1: the midterms, and the Democrats were like, well, we're gonna 514 00:30:11,400 --> 00:30:12,920 Speaker 1: get out in front of that and we're gonna put 515 00:30:12,960 --> 00:30:15,400 Speaker 1: it on the floor, and you know, got a big 516 00:30:15,480 --> 00:30:17,680 Speaker 1: vote in the Senate. There's still kind of a messy 517 00:30:17,720 --> 00:30:20,760 Speaker 1: situation in the House as far as the path forward 518 00:30:20,760 --> 00:30:23,280 Speaker 1: for that bill, but you know there's tens of billions 519 00:30:23,280 --> 00:30:28,200 Speaker 1: of dollars in there for science, for research for semiconductors, 520 00:30:28,200 --> 00:30:33,040 Speaker 1: So I do see, Uh, this is something that really 521 00:30:33,080 --> 00:30:36,440 Speaker 1: does have bipartisan support. When you have chips shutting down. 522 00:30:36,560 --> 00:30:39,520 Speaker 1: You know, truck plants and car plants all over the 523 00:30:39,560 --> 00:30:42,520 Speaker 1: country there they're in red states and blue states, and 524 00:30:42,560 --> 00:30:46,720 Speaker 1: those are jobs that that you know, people want to 525 00:30:46,720 --> 00:30:49,720 Speaker 1: make sure our back up and running quickly. Comress Woman 526 00:30:49,760 --> 00:30:54,240 Speaker 1: Hayley Stevens yesterday a Democrat, and Congressman Kevin Brady today, 527 00:30:54,280 --> 00:30:56,400 Speaker 1: of course, a Republican and a and a high ranking 528 00:30:56,400 --> 00:31:00,000 Speaker 1: Republican in the House, both got to this chip issue. 529 00:31:00,200 --> 00:31:02,840 Speaker 1: Both pointed to jobs, just like Stephen did Jack to say, 530 00:31:02,880 --> 00:31:05,840 Speaker 1: you know, GM shutting down for a week pickup truck 531 00:31:05,880 --> 00:31:09,400 Speaker 1: production next week because of this, thirteen thousand jobs in 532 00:31:09,480 --> 00:31:12,120 Speaker 1: Michigan on the line. This is this is a major 533 00:31:12,160 --> 00:31:15,080 Speaker 1: political issue I suspect we'll be hearing about through the summer. Yeah, 534 00:31:15,080 --> 00:31:18,080 Speaker 1: the chips issue in particularly because for one, there there 535 00:31:18,120 --> 00:31:24,120 Speaker 1: are national security concerns when you allow a critical object 536 00:31:24,240 --> 00:31:26,960 Speaker 1: to be produced very heavily by a foreign entity with 537 00:31:27,000 --> 00:31:31,440 Speaker 1: an adversarial government. But also the chips issue gets into 538 00:31:31,600 --> 00:31:35,400 Speaker 1: the production shortages right now with vehicles. That's been a 539 00:31:35,440 --> 00:31:40,560 Speaker 1: significant part of you know, Jerome Powell even mentioned that 540 00:31:40,640 --> 00:31:43,440 Speaker 1: as a contributing factor to the inflation that we've seen. 541 00:31:43,720 --> 00:31:45,880 Speaker 1: It's a broad economic issue, and I think Steve's right 542 00:31:45,920 --> 00:31:49,440 Speaker 1: that Republicans wanted to bring up China as something to 543 00:31:49,520 --> 00:31:52,120 Speaker 1: bludgeon Democrats with, and largely Democrats have said, no, we 544 00:31:52,160 --> 00:31:54,400 Speaker 1: can't really see that ground. We have to take some 545 00:31:54,520 --> 00:31:57,360 Speaker 1: tough measures as well. That's that's gonna be something we're 546 00:31:57,400 --> 00:32:00,640 Speaker 1: talking about next week once again, along with of course infrastructure. 547 00:32:01,040 --> 00:32:04,200 Speaker 1: We touched on some of this, but I want to 548 00:32:04,200 --> 00:32:06,000 Speaker 1: get to some of the comments we heard today from 549 00:32:06,040 --> 00:32:08,800 Speaker 1: Senator Bill Cassidy, who spoke with Bloomberg's David Weston of 550 00:32:08,840 --> 00:32:13,680 Speaker 1: course Republican from Louisiana, speaking very optimistically and just smiling 551 00:32:13,680 --> 00:32:16,960 Speaker 1: through the whole interview, but spoke specifically when David asked 552 00:32:17,040 --> 00:32:20,120 Speaker 1: him about the matter of paying for all this. Folks 553 00:32:20,120 --> 00:32:22,640 Speaker 1: so always find a problem with our paid for us. 554 00:32:22,680 --> 00:32:25,160 Speaker 1: They will always find a problem. On the other hand, 555 00:32:25,800 --> 00:32:30,280 Speaker 1: um um, we will haven't paid for and we will 556 00:32:30,320 --> 00:32:32,840 Speaker 1: be able to not just pay for it, but point 557 00:32:32,920 --> 00:32:36,960 Speaker 1: towards long term gangs the society will the economy will 558 00:32:37,000 --> 00:32:41,120 Speaker 1: benefit from. According to multiple economists across the political spectrum, 559 00:32:41,200 --> 00:32:43,360 Speaker 1: that all sounds great, Stephen, But have we figured out 560 00:32:43,360 --> 00:32:45,760 Speaker 1: how to pay for it? Yeah? I mean, you know, 561 00:32:46,080 --> 00:32:48,760 Speaker 1: the pay for is I kind of call them couch 562 00:32:48,880 --> 00:32:52,200 Speaker 1: cushion pay for us. That this is not a whole 563 00:32:52,200 --> 00:32:54,520 Speaker 1: lot of pain. You know, pain is when you go 564 00:32:54,560 --> 00:32:58,080 Speaker 1: out and you say, okay, we're gonna cut Medicare providers 565 00:32:58,200 --> 00:33:01,960 Speaker 1: or we're gonna increase taxes is on corporation X y Z. 566 00:33:02,600 --> 00:33:04,840 Speaker 1: They didn't want to do that, so they looked around 567 00:33:04,840 --> 00:33:07,600 Speaker 1: for couch cushion money, money that isn't going to be 568 00:33:07,640 --> 00:33:10,560 Speaker 1: spent anyways, and they could say, well, hey, look at 569 00:33:10,600 --> 00:33:12,560 Speaker 1: this pot of money that I am going to quote 570 00:33:12,640 --> 00:33:16,800 Speaker 1: unquote saf um or things that are probably gonna happen anyways. 571 00:33:16,800 --> 00:33:20,480 Speaker 1: There's a big sort of a Medicare drug rebate rule 572 00:33:20,560 --> 00:33:24,160 Speaker 1: which is really hard to explain, but it involves pharmacy 573 00:33:24,200 --> 00:33:28,200 Speaker 1: benefit UH companies that are sort of like the middlemen 574 00:33:28,280 --> 00:33:34,080 Speaker 1: of the drug market. Delaying that rule or killing that 575 00:33:34,200 --> 00:33:36,960 Speaker 1: rule saves a lot of money for the government, but 576 00:33:37,080 --> 00:33:38,800 Speaker 1: it's sort of like it's not something that people are 577 00:33:38,840 --> 00:33:42,320 Speaker 1: gonna notice. Um, it hasn't been implemented, probably never was 578 00:33:42,360 --> 00:33:45,360 Speaker 1: going to be implemented. It's going to be superseded by 579 00:33:45,360 --> 00:33:50,000 Speaker 1: lots of other things. So you know, UH, senators, for 580 00:33:50,040 --> 00:33:52,360 Speaker 1: as long as I have covered them, do not like 581 00:33:52,520 --> 00:33:57,000 Speaker 1: to do things that cause their constituents pain. And so 582 00:33:57,160 --> 00:34:00,760 Speaker 1: they've managed to cobble together, you know, half a trillion 583 00:34:00,800 --> 00:34:05,560 Speaker 1: dollars or so of couch cushion money and they can say, hey, 584 00:34:05,720 --> 00:34:08,760 Speaker 1: we're not going to raise taxes, but you know, somewhere 585 00:34:08,800 --> 00:34:11,359 Speaker 1: somewhere down the line, you're still going to have the 586 00:34:11,400 --> 00:34:14,200 Speaker 1: fact that we have a gas tax revenue source that 587 00:34:14,280 --> 00:34:18,600 Speaker 1: hasn't been increased since cars are getting more fuel efficient 588 00:34:18,680 --> 00:34:22,480 Speaker 1: or going electric, they haven't solved a long term problem here. 589 00:34:22,520 --> 00:34:26,440 Speaker 1: This is sort of a very large can kick for 590 00:34:26,480 --> 00:34:29,120 Speaker 1: about five years, and in about five years we're all 591 00:34:29,160 --> 00:34:32,200 Speaker 1: going to be having this discussion again of you know, 592 00:34:32,239 --> 00:34:35,799 Speaker 1: what do we do now that the electric cars are 593 00:34:35,840 --> 00:34:38,000 Speaker 1: maybe instead of one or two percent or maybe five 594 00:34:38,080 --> 00:34:43,480 Speaker 1: or um and so on. So you know, this is 595 00:34:43,520 --> 00:34:46,640 Speaker 1: not like the deal that the Reagan cut with Tip 596 00:34:46,640 --> 00:34:50,239 Speaker 1: O'Neil to you know, solve Social Security for twenty or 597 00:34:50,280 --> 00:34:54,000 Speaker 1: thirty years. This is a five year type deal, maybe 598 00:34:54,040 --> 00:34:57,600 Speaker 1: eight years. Well, we'll see what the details end up 599 00:34:57,840 --> 00:35:00,239 Speaker 1: looking like. So Jack, we add the debt ceiling to 600 00:35:00,280 --> 00:35:02,600 Speaker 1: all of this. Now, it was set to expire at 601 00:35:02,600 --> 00:35:05,719 Speaker 1: the end of this month, right the the CBO this 602 00:35:05,760 --> 00:35:08,600 Speaker 1: week said that we would actually default in October. I 603 00:35:08,600 --> 00:35:10,520 Speaker 1: think was the idea, right, So we have a little 604 00:35:10,520 --> 00:35:12,000 Speaker 1: bit of time to play with this. Is this gonna 605 00:35:12,040 --> 00:35:14,719 Speaker 1: end up at reconciliation, Like Mitch McConnell, So that's a 606 00:35:14,760 --> 00:35:17,480 Speaker 1: tough one. And actually the effective deadline they're they're very 607 00:35:17,520 --> 00:35:21,960 Speaker 1: vague on the CBO said October or November, but maybe sooner. 608 00:35:22,239 --> 00:35:24,800 Speaker 1: And then there was a warning today from Janet yelling 609 00:35:24,840 --> 00:35:27,400 Speaker 1: that this could happen shortly after the lawmakers come back 610 00:35:27,440 --> 00:35:30,000 Speaker 1: from their August recess. So how do we not know 611 00:35:30,760 --> 00:35:34,239 Speaker 1: because the deadline deadline is the beginning of August. And 612 00:35:34,280 --> 00:35:36,600 Speaker 1: then it's a matter of how many payments that can 613 00:35:36,640 --> 00:35:38,960 Speaker 1: they delay, how much cash can they keep on hand. 614 00:35:39,120 --> 00:35:42,600 Speaker 1: There's a hundred fifty billion dollars due to be paid 615 00:35:43,040 --> 00:35:47,040 Speaker 1: on October one, that one single day, so it's very difficult. 616 00:35:47,480 --> 00:35:50,600 Speaker 1: It's like they are blindfolded on a raft headed to 617 00:35:51,200 --> 00:35:53,400 Speaker 1: a waterfall and they don't know when they're going to 618 00:35:53,480 --> 00:35:55,400 Speaker 1: go off the waterfall, but they know what will happen. 619 00:35:55,680 --> 00:35:58,080 Speaker 1: So there needs to be a deal soon. It can 620 00:35:58,120 --> 00:36:01,239 Speaker 1: be done through reconciliation. But then Democrats would have to 621 00:36:01,280 --> 00:36:04,000 Speaker 1: own that politically and say we increased this, which that 622 00:36:04,040 --> 00:36:07,360 Speaker 1: would be exactly what mconnell wants and exactly what the 623 00:36:07,400 --> 00:36:09,680 Speaker 1: Democrats don't want. I've talked to a lot of Democrats 624 00:36:09,719 --> 00:36:12,600 Speaker 1: this week who are like, let me get this straight. 625 00:36:12,640 --> 00:36:16,600 Speaker 1: We helped the Republicans increase the debt limit year after year, 626 00:36:16,680 --> 00:36:19,839 Speaker 1: even though we didn't like that income tax cut for 627 00:36:19,840 --> 00:36:23,479 Speaker 1: for the corporations and the wealthy. And now you're gonna 628 00:36:23,520 --> 00:36:25,880 Speaker 1: hold it hostage again, or try to hold it hostage again. 629 00:36:26,680 --> 00:36:29,439 Speaker 1: Why Chuck Schumer says, this is Trump debt we're talking about, 630 00:36:29,520 --> 00:36:32,279 Speaker 1: right to remind everything, it's you know, it's the a 631 00:36:32,360 --> 00:36:36,920 Speaker 1: lot of even if the Congress didn't spend any more money, 632 00:36:37,080 --> 00:36:40,400 Speaker 1: um between now and you know, September, if they just 633 00:36:40,400 --> 00:36:43,760 Speaker 1: spend no more money, uh, even if they had passed 634 00:36:43,800 --> 00:36:47,319 Speaker 1: that one point nine trillion dollar rescue package, that our 635 00:36:47,360 --> 00:36:50,479 Speaker 1: annual deficitis are a trillion dollars a year, they're eighty 636 00:36:50,480 --> 00:36:53,160 Speaker 1: billion dollars a month on average. You need to raise 637 00:36:53,160 --> 00:36:55,600 Speaker 1: the debt limit or else you're gonna have, you know, 638 00:36:55,920 --> 00:36:58,400 Speaker 1: the first default in well, I mean, you know, you 639 00:36:58,480 --> 00:37:01,880 Speaker 1: might not have a d fault on payments on interest 640 00:37:02,000 --> 00:37:04,359 Speaker 1: on the debt, but you could say, okay, well we 641 00:37:04,440 --> 00:37:09,400 Speaker 1: can't make payroll at certain departments, or the SoC Security 642 00:37:09,480 --> 00:37:12,759 Speaker 1: checks can't go out. I mean, we haven't had that 643 00:37:12,840 --> 00:37:15,520 Speaker 1: kind of a situation where we've actually gone over the cliff. 644 00:37:15,800 --> 00:37:19,720 Speaker 1: In twent we came very close, and the markets were rattled, 645 00:37:19,920 --> 00:37:26,719 Speaker 1: consumer confidence tanked, uh interest rates wobbled, we had a 646 00:37:26,760 --> 00:37:29,839 Speaker 1: credit downgrade from one of the main credit rating agencies. 647 00:37:29,880 --> 00:37:33,200 Speaker 1: It was not a great situation. Although the Republicans look 648 00:37:33,239 --> 00:37:34,839 Speaker 1: back at that and they say, Okay, well, we've got 649 00:37:34,840 --> 00:37:37,040 Speaker 1: a couple of trillion dollars in spending cuts out of 650 00:37:37,040 --> 00:37:40,319 Speaker 1: it over a decade, so they, you know, they're kind 651 00:37:40,320 --> 00:37:43,359 Speaker 1: of of two minds of that. But you know, right now, 652 00:37:43,400 --> 00:37:46,160 Speaker 1: the Democrats have the majority in both houses, they have 653 00:37:46,280 --> 00:37:49,200 Speaker 1: the White House, they can use reconciliation. It's not a 654 00:37:49,320 --> 00:37:52,400 Speaker 1: question of whether the debt limit is going to be raised. 655 00:37:52,800 --> 00:37:57,640 Speaker 1: It's a question of when how much can they how 656 00:37:57,719 --> 00:37:59,879 Speaker 1: far can they kick the can on it this time? 657 00:38:00,480 --> 00:38:03,200 Speaker 1: And they've got to get, you know, on like everything else, 658 00:38:03,239 --> 00:38:05,799 Speaker 1: they've got to get Joe Manchin and Bernie Sanders. Don't 659 00:38:05,840 --> 00:38:08,600 Speaker 1: both of you guys thin covered Washington for some time, 660 00:38:08,719 --> 00:38:12,560 Speaker 1: think it's gonna it'll have to be lifted. And every 661 00:38:12,600 --> 00:38:16,000 Speaker 1: Democrat knows that, including Joe Manchin who said there will 662 00:38:16,080 --> 00:38:18,640 Speaker 1: not be a debt default. You heard it from Jack 663 00:38:18,719 --> 00:38:22,960 Speaker 1: Fitzpatrick here and Stephen Dennis our panel today, I'm Joe 664 00:38:23,000 --> 00:38:25,680 Speaker 1: Matthew have a great weekend. See if we get some 665 00:38:25,719 --> 00:38:28,160 Speaker 1: news on Monday, stay with us. I'm Joe Matthew