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Speaker 2: In Washington after Bloomberg reported via sources familiar with the matter,
Speaker 2: that a ceasefire agreement has been reached between Israel and Hamas,
Speaker 2: although we should point out we just got a statement
Speaker 2: from the Israeli Prime Minister Benjamin Netanyahu's office saying there
Speaker 2: are still several unresolved points in the outline of the
Speaker 2: ceasefire and hostage release agreement, and they hope the details
Speaker 2: will be finalized tonight. Of course, these developments follow what
Speaker 2: had been days of signaling from officials in the Biden
Speaker 2: administration that things were getting closer, including Jake Sullivan, who
Speaker 2: told our colleague Jenny Letterd this at a visit to
Speaker 2: Bloomberg at the beginning of this week.
Speaker 3: I think the pressure is building for Hamas to come
Speaker 3: to yes. I think Israel also has achieved a huge
Speaker 3: amount of its military objectives in Gaza, and therefore they
Speaker 3: are in a position to be able to say yes.
Speaker 3: So there is a distinct possibility that we can get
Speaker 3: this deal done this week.
Speaker 4: You heard that here and saw it on Bloomberg on Monday.
Speaker 4: Here we are on Wednesday with reports of a breakthrough
Speaker 4: here and joining us at the table is the leader
Speaker 4: of our national security coverage in Washington. Bloomberg's Nick Wadham's.
Speaker 4: Great to see you, Nick. I know you're extremely busy
Speaker 4: at the moment. These headlines, though, coming from the Israeli
Speaker 4: Prime Minister's office, make us wonder what's really going on here,
Speaker 4: and it brings us back to May when Joe Biden
Speaker 4: announced what appeared to be a comprehensive seven point plan,
Speaker 4: only to be frowned on by Benjamin Netanyahu. Is this
Speaker 4: deja vu? Or is this a real breakthrough?
Speaker 5: Well, you know, up to about I would say, five
Speaker 5: minutes ago, we thought this was a real breakthrough. I
Speaker 5: mean President Elect Trump announced on truth Social he had
Speaker 5: Chuck Schumer from the Senate floor saying he'd just been
Speaker 5: informed by the administration that they had a deal. We
Speaker 5: and many others were told by US officials and folks
Speaker 5: in the region that the deal was done, so it's
Speaker 5: unclear whether these comments from the Prime Minister are some
Speaker 5: sort of face saving exercise or really mean that this
Speaker 5: deal is now being frozen in its tracks. I mean,
Speaker 5: what you are going to see here, though, is a
Speaker 5: test because President elect Trump has essentially in the last
Speaker 5: few minutes taken credit for this, saying it was his
Speaker 5: election in November that meant this deal could be done.
Speaker 5: And a big part of that narrative is that he
Speaker 5: was finally really able to put the squeeze on bb
Speaker 5: in a way that President Biden was not. So now
Speaker 5: that Israel seems to be equivocating a little bit, we've
Speaker 5: got some more reporting to do.
Speaker 2: It looks like well, and we'll let you get to
Speaker 2: it in just a minute, Nick, But while we have
Speaker 2: you this notion that obviously nothing is done until it's done.
Speaker 2: It also isn't a permanent ceasefire until it is one,
Speaker 2: even if they can reach an agreement tonight on whatever
Speaker 2: this temporary.
Speaker 6: Pause will be. Is this really the easier part.
Speaker 2: Than figuring out a way to fully end this war
Speaker 2: on a permanent basis?
Speaker 5: Yeah, I mean, this is such a heavy lift in
Speaker 5: so many ways, in a depressing way, this really is
Speaker 5: the easiest part. I mean, you have a pause in
Speaker 5: the fighting, you have a release of some three dozen hostages.
Speaker 5: Presumably the fundamental equation remains unchanged. And we've spoken about
Speaker 5: this many times. Israel has said no halt to the
Speaker 5: war until Gaza is freed of Hamas. You had Secretary
Speaker 5: of State blinking yesterday, I believe, essentially saying that they
Speaker 5: believe Hamas has managed to recruit almost as many fighters
Speaker 5: as it's lost in this So Hamas appears to remain,
Speaker 5: at least in the US view, somewhat undiminished. Where does
Speaker 5: that leave us? How do we transition then? If Hamas
Speaker 5: remains in power, and net and Yahoo insists that Israel
Speaker 5: won't stop until they're out of power, those are questions
Speaker 5: no one has been able to resolve. But at least
Speaker 5: for the time being, it does appear that we would
Speaker 5: have a halt. That then the US would try to
Speaker 5: sort of spin or seek to get momentum from to
Speaker 5: bring a lasting ceasefire that could bring a permanent into
Speaker 5: this conflict.
Speaker 4: That would also, though, mean those concerns you outline a
Speaker 4: continuation of the US military presence in the Middle East,
Speaker 4: at least of the level we have now that's right.
Speaker 5: I mean, there's there's absolutely no question that the US
Speaker 5: is going to maintain that presence President elect Trump. You know,
Speaker 5: he said just a few days ago, listen, if this
Speaker 5: thing is not wrapped up before I get into office,
Speaker 5: all hell is going to break loose. The idea was that, Okay,
Speaker 5: Hamas presumably listened to that and was felt some pressure
Speaker 5: that you know, no way out. Also he would have
Speaker 5: leaned on net Yahoo. But I mean, I mean, I
Speaker 5: do think when you look at the underlying force posture
Speaker 5: and strategic deployment for the region, and things are not
Speaker 5: going to change. We are not backing down. The US
Speaker 5: is not bringing people back, and it's forced posture is
Speaker 5: going to remain very high.
Speaker 2: As we are now just days away from Donald Trump's inauguration, Nick,
Speaker 2: We've had conversations with multiple national security experts, people focused
Speaker 2: on the Middle East, who have suggested that Donald Trump
Speaker 2: is inheriting what has a dramatically weakened Iran, and I
Speaker 2: wonder to what extent the weakening of Iran is attributing
Speaker 2: to the timing here as well. Knowing that Israel was
Speaker 2: able to dismantle a lot of the infrastructure and take
Speaker 2: out most of Hesbalah leadership in addition.
Speaker 6: To everything it's been waging with Hamas.
Speaker 2: Is this deal likely to go forward if Iran isn't saying, Cammas,
Speaker 2: you do kind of need to do this.
Speaker 6: We can't back you up in the same way.
Speaker 5: Well, I mean, Iran's role is a huge factor here,
Speaker 5: and yes, I mean a big element in this is
Speaker 5: that Hamas seems to be much more isolated than it was.
Speaker 5: I mean, you have Iran, you have Hesballah, you have Sirious.
Speaker 5: So all of these dominoes have fallen and that has
Speaker 5: fundamentally changed Hamas's calculus. So whether or not they say
Speaker 5: they're going to give up the fight permanently, there is
Speaker 5: no question that Hamas has been seriously weakened. And that
Speaker 5: is a direct result of the fact that Iran has
Speaker 5: also been very seriously weakened. And you know what's to come.
Speaker 5: Trump has promised a reimposition of maximum pressure on Iran,
Speaker 5: so you can expect to see his administration really tight
Speaker 5: in the economic screws on them.
Speaker 2: All Right, Nick Wadams, I know you got work to do,
Speaker 2: so we'll let you go leading our national security team
Speaker 2: in Washington. Thank you so much and we want to
Speaker 2: get more on these developed developments. Now in turn to
Speaker 2: another expert in the region, Garshamali is with US former
Speaker 2: director for Syria and Lebanon at the National Security Council,
Speaker 2: now founder and CEO of Greenwich Media Strategies. Welcome back
Speaker 2: to Bloomberg TV and Radio.
Speaker 6: Hagar As.
Speaker 2: I'm sure you just heard us describing we have sources
Speaker 2: saying that yes, there is a deal in place. The
Speaker 2: Israeli Prime Minister's office, though, seems to be saying not
Speaker 2: quite so fast.
Speaker 6: Do you think this one's real?
Speaker 7: I do think this.
Speaker 8: One is real, And for the last few days I've
Speaker 8: been saying that we've never been so close. And the
Speaker 8: reason for that is that you have a lot of
Speaker 8: moving parts that have converged. I know that you're going
Speaker 8: to see president like Trump take credit and Biden take credit,
Speaker 8: and they're each going to, you know, thump their chest
Speaker 8: about it. But the fact is that you had a
Speaker 8: lot of different factors feed into this. The most important
Speaker 8: is the shifting geopolitical dynamics in the Middle East, and
Speaker 8: that really accelerated after the fall of US side. That's
Speaker 8: really what shifted Hamas's view. Suddenly they were completely alone
Speaker 8: Hamas is nothing without its backers.
Speaker 7: So now you've got Iran is on the defense.
Speaker 8: Hasbella's been decapitated, and when us AT falls and therefore
Speaker 8: their land bridge to Iran is also gone, Suddenly they
Speaker 8: were on their own. And back in December, that's when
Speaker 8: Hamas started to accept terms of this deal that they
Speaker 8: were not willing to accept before, namely with regards to
Speaker 8: Israeli military presence in Gaza, particularly on the Egypt Gaza border.
Speaker 7: And so that's when you saw them shift their tune.
Speaker 8: Of course, the maruhu're coming from Biden and Trump, each
Speaker 8: for different reasons.
Speaker 7: Biden wants one last success. Trump doesn't want this hanging
Speaker 7: over his head. That plays a significant role as well.
Speaker 8: But it's really all of these factors that played into this,
Speaker 8: and that's also why I believe that this will find,
Speaker 8: this final push will go through.
Speaker 4: Ugard's great to see you, and we appreciate your being
Speaker 4: with us here in the clutch with breaking news. I
Speaker 4: wonder if it's possible, though, that really we needed both
Speaker 4: sides to be working this negotiation and maybe both deserve credit.
Speaker 4: Donald Trump and his news conference last week, stood there
Speaker 4: with Steve Witkoff talking about the progress that they had made.
Speaker 4: Did it in fact take both administrations if you will.
Speaker 7: I'm a believer in that. That's my own opinion that
Speaker 7: it's both.
Speaker 8: That a lot of the success can be attributed to
Speaker 8: the fact that you have both working on it for
Speaker 8: different reasons, with different messages that complement each other. Because
Speaker 8: on the Biden side, they've been working on this for
Speaker 8: well over a year.
Speaker 7: They've been pushing these parties.
Speaker 8: They know these negotiators, they know all the issues, all
Speaker 8: the concerns, all the needs, and they've been working this.
Speaker 8: But when you have Trump coming into office, someone who's
Speaker 8: notoriously erratic, unpredictable, who assassinated Iran's a general costum Soulimani
Speaker 8: in twenty twenty, that shifts things because that instills a
Speaker 8: little bit more fear on one hand on the objectionable
Speaker 8: actors like Hamas and Iran, but also Trump is able
Speaker 8: to twist Netanyah, who's arms a bit further because Nettan Yah,
Speaker 8: who simply likes him more, and we've seen that play
Speaker 8: out many times. And a lot of that could be
Speaker 8: attributed to Trump's first administration and the policies he pursued
Speaker 8: toward Israel back then moving the embassy to Jerusalem, recognizing
Speaker 8: the annexation of goal On Heights, and so on. And
Speaker 8: so when you've got the mix of the two of them,
Speaker 8: it plays very well for a situation like this. And
Speaker 8: by the way, allegedly Steve Witkoff himself said that said
Speaker 8: something to that effect when he was in Israel.
Speaker 7: The Israeli Pressed for the last.
Speaker 8: Few days has said that Steve Witkoff said that Brett
Speaker 8: McGirk out in the region that he was leading these negotiations.
Speaker 8: They have been working in tandem for the last couple
Speaker 8: of months because the Biden administration has an interest in
Speaker 8: passing on their plans, of course to the next administration.
Speaker 7: That's just simply how it always works.
Speaker 8: But they've been working on both of them, and their
Speaker 8: messaging has apparently been different. Is there very Pressed, for example,
Speaker 8: said that Steve Whitkoff in his meetings said you better
Speaker 8: get to this deal or else to Israel by the way,
Speaker 8: Tantanyahu did specifically.
Speaker 7: So the mix of those messages.
Speaker 8: And goals I do think plays really well, and I
Speaker 8: agree with you they could both take.
Speaker 7: Credit for this.
Speaker 9: Well.
Speaker 2: So as we consider which administration is ultimately going to
Speaker 2: take credit or whether that credit will be shared. Obviously,
Speaker 2: it's not just about the presidents, but others, including for example,
Speaker 2: the Secretary of State Anthony B. Lincoln, who actually talked
Speaker 2: about the circumstances with Hamas in particular and whether or
Speaker 2: not this war could turn, this war with Hamas could
Speaker 2: turn into something everlasting. He spoke at the Atlantic Council yesterday. Hgar,
Speaker 2: this is what he said, and we'll have a respond.
Speaker 10: Each time Asrael completes its military operations and pulls back AMAS,
Speaker 10: militants regroup and re emerge because there's nothing else to
Speaker 10: fill the void.
Speaker 4: Indeed, we assess.
Speaker 10: That Hamas has recruited almost as many new militants as
Speaker 10: it is lost. That is a recipe for an enduring
Speaker 10: insurgency and perpetual war, so Gar.
Speaker 2: It brings us to the question of even if you
Speaker 2: get a ceasefire, now, even if you can turn that
Speaker 2: into something permanent, how permanent realistically it will be if
Speaker 2: Israel's goal of complete eradication of an ideology is not
Speaker 2: one that can actually be reached.
Speaker 8: What you say, you have two issues playing out here,
Speaker 8: two different but two related factors that could really lead
Speaker 8: into something a long lasting insurgency.
Speaker 7: For sure.
Speaker 8: One is the fact that, as Secretary Blincoln was talking about,
Speaker 8: is the difficulty in reaching a permanent solution. And now,
Speaker 8: when you have a cease fire, it's obviously great news
Speaker 8: and it's something a lawed, but this is phase.
Speaker 7: If they come to this, this would be.
Speaker 8: Phase one of three phases, and the third phase is
Speaker 8: where a permanent end to this would be negotiated. So
Speaker 8: the good news is that you've now opened this door
Speaker 8: to potential future negotiations, but they're obviously very fragile and
Speaker 8: without real real thinking and buy in by the parties
Speaker 8: on how the future of Gaza will look and how
Speaker 8: that permanent solution looks, then it's going to be very
Speaker 8: tenuous now blinking. In that speech at the Atlantic Council,
Speaker 8: he did say that for months now, the Bide administration
Speaker 8: has worked on a post conflict plan. They've passed that
Speaker 8: on to the Trump folks, and they've worked with certain partners.
Speaker 8: There is some smart thinking on this issue, but we
Speaker 8: don't know the full details of it, so we don't
Speaker 8: know if those terms are really feasible. They include things,
Speaker 8: for example, like a Middle Eastern peacekeeping mission that would
Speaker 8: be there how Gaza would be governed in the future.
Speaker 7: But again, very very tenuous, very difficult issues.
Speaker 8: Hamas's one goals to survive, so they're not going to
Speaker 8: take it. They're not going to go down easily. The
Speaker 8: Palestinian authority or another authority to take control over gozens.
Speaker 8: It's going to be very difficult. And the second issue
Speaker 8: you have playing out here is that the way Israel
Speaker 8: approached the war in Gaza.
Speaker 7: Whether you know my views.
Speaker 8: I've been very clear about my views. I worked in
Speaker 8: counter terrorism. I'm more than happy to see Hamas completely decimated.
Speaker 8: But the way they approached it and the humanitarian crisis
Speaker 8: that ensued is going to push a lot of those
Speaker 8: gosins into the arms of the enemy. And that's the problem.
Speaker 8: So even if you erase Hamas, there is going to
Speaker 8: be grievances there. There's going to be angst and very
Speaker 8: recent i mean very fresh wounds there that could lead
Speaker 8: them to the arms of a different terrorist group with
Speaker 8: open arms, just under a different name. And that's why
Speaker 8: Secretary B. Lincoln was saying that I do think that
Speaker 8: that's a significant risk, and the only way to go
Speaker 8: about that at this stage is to plan for a
Speaker 8: very long peace process. But hopefully if you can include
Speaker 8: in that a deal that leads to state solution, something
Speaker 8: where you have the light at the end of the tunnel.
Speaker 7: That's the only way you're going to be able to
Speaker 7: try and circumvent.
Speaker 8: Some of that inevitability of individuals joining further insurgent or
Speaker 8: tear spoofs.
Speaker 4: Magarwin our remaining moment here if I can add to
Speaker 4: the permanent war argument. Terry Hayes at Pangaea out with
Speaker 4: analysis following this headline, suggesting that this will not lower
Speaker 4: geopolitical risk. Israel will remain split hamas is not out
Speaker 4: to Anthony Blincoln's point, battlefields from Yemen to the Red
Speaker 4: Sea to Lebanon will continue to be regional flashpoints behind
Speaker 4: it all. Yes, a weekend I ran, but also China.
Speaker 4: How much does Donald Trump have to worry about even
Speaker 4: after this deal is struck, if it's real.
Speaker 7: Well, he has a lot to worry about. There's still
Speaker 7: a lot of work there.
Speaker 8: The fact is that with Trump in office, the one
Speaker 8: region that I have real hope for that I have
Speaker 8: not had hope for in decades is the Middle East.
Speaker 8: That I don't share that for the whole world or
Speaker 8: for the United States, But when it comes to the
Speaker 8: Middle East in particular, I believe then the reason for
Speaker 8: that is that Iran is at the root of most
Speaker 8: of the problems in the Middle East, whether it's backing
Speaker 8: terroist groups in Yemen and in Syria and Iraq and Lebanon,
Speaker 8: or it's pursuing actual terrorists behavior across the region and
Speaker 8: pushing its ideology and the expansion of it across the region,
Speaker 8: trying to compete and become the regional hegemon. So with
Speaker 8: Iran on the defense this way, and with them knowing
Speaker 8: that they have a leader coming in who isn't afraid
Speaker 8: to assassinate one of their generals, that's going to make
Speaker 8: them behave So I have hope for the Middle East.
Speaker 7: But listen, you're talking about it.
Speaker 4: We want to share your hope. Agar, come back and
Speaker 4: bring more hope to us. Agar Shamali with us on
Speaker 4: Balance of Power. This is Bloomberg.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 1: eleven thirty.
Speaker 2: This is Balance of Power Life from Washington. I'm Kaylee
Speaker 2: Lines alongside Joe Matthew. This is, of course the early
Speaker 2: edition of Balance of Power. But we have a lot
Speaker 2: of coverage coming up for you throughout the course of today,
Speaker 2: not just the late edition of Balance of Power, but
Speaker 2: we will also be here this evening for special coverage
Speaker 2: of the farewell address of Joe Biden, given from the
Speaker 2: Oval Office at the White House tonight at eight pm
Speaker 2: Eastern Time.
Speaker 6: It's just one of many speeches he.
Speaker 2: Has given or will give this week, as he has
Speaker 2: just days left in office, five days to be exact.
Speaker 4: Jeff addressing the American people in prime time. It's a
Speaker 4: venue he hasn't used terribly often over the course of
Speaker 4: these four years. But we're wondering exactly what he's going
Speaker 4: to say, Kaylee. With news of what appears to be
Speaker 4: a possible cease fire in the Middle East, we thought
Speaker 4: there was a deal and he may well announce one,
Speaker 4: but after some hedging, I guess from the Israeli Prime
Speaker 4: Minister's office, We're playing this a little bit carefully here,
Speaker 4: so I'm guessing that we have a couple of scripts
Speaker 4: in play, and we're going to talk to our panel
Speaker 4: about this next. Rick and Jenie are with us, But
Speaker 4: why don't we start at the White House? Bloomberg's Tyler
Speaker 4: Kendall is on the North lawn right now. It's an
Speaker 4: important day there as the staff, the communications department, and
Speaker 4: the rest prepare for a farewell address to the nation. Tyler,
Speaker 4: how's it going well, Joe.
Speaker 11: The last time that President Biden addressed the nation from
Speaker 11: the Oval Office, it was back in July when he
Speaker 11: had dropped out of the twenty twenty four presidential race,
Speaker 11: and at the time he said there were a few
Speaker 11: priorities that he wanted to spend his remaining months in
Speaker 11: office focused on. In one of them was securing a
Speaker 11: deal for the hostages in Gaza to be released. So
Speaker 11: as these details start to emerge, we will wait and
Speaker 11: see if President Biden does end up announcing that deal
Speaker 11: and having that be part of these farewell address tonight. However, Joe,
Speaker 11: as you know, this is largely considered to be his
Speaker 11: capstone speech after more than fifty years here in Washington.
Speaker 11: Elected to the Senate in nineteen seventy three, and Caylee
Speaker 11: mentioned it before. This has been a week of farewell
Speaker 11: events for President Biden, and for a sense of the
Speaker 11: tone of the messaging that we could expect tonight, I
Speaker 11: want you to take a lesson here to how he
Speaker 11: addressed this State Department on Monday during one of his
Speaker 11: farewell addresses to the employees there.
Speaker 12: Common I took office, our nation had become stronger at home,
Speaker 12: are stronger in the world, and now America is more capable,
Speaker 12: and I would argue better prepared, and we've been in
Speaker 12: a long long time.
Speaker 11: Bloomberg News is also reporting that President Biden is expected
Speaker 11: to talk about the country's economic turnaround, noting how he
Speaker 11: took office amid the height of the COVID nineteen pandemic.
Speaker 11: We are also expecting him to teut some of his
Speaker 11: legislative victories, including the bipartisan Infrastructure Bill, as well as
Speaker 11: the Chips and Science Act. But of course, Joe and Kelley,
Speaker 11: as you both know, this is coming against the backdrop
Speaker 11: of low approval ratings for President Biden. According it to Gallup,
Speaker 11: he is leaving office with a thirty nine percent approval
Speaker 11: rating That is about eighteen percentage points lower than when
Speaker 11: he took office four years ago.
Speaker 2: All right, Bloomberg Tyler Kendall live at the White House
Speaker 2: for us this afternoon. Thank you so much, And as
Speaker 2: we look ahead to this farewell address, we want to
Speaker 2: bring in our signature political panel. Rick Davis is with
Speaker 2: US Republican Strategists and partner at Stone Court Capital, alongside
Speaker 2: Democratic strategist Genie Shanzeno, political science professor at Iona University
Speaker 2: and Senior Democracy Fellow at the Center for the Study
Speaker 2: of the Presidency and Congress. Genie just on Tyler's last
Speaker 2: point about the fact that Joe Biden is leaving office
Speaker 2: as a deeply unpopular president, can he say anything tonight
Speaker 2: to help make history view him differently than that?
Speaker 13: I'm not sure he can say anything in particular tonight,
Speaker 13: but I and I don't have hope he will do
Speaker 13: what I'm advising, Kaylee. But I'm really hoping that they
Speaker 13: don't go with a litany of accomplishments that we have
Speaker 13: achieved and a litany of policies and the amount of
Speaker 13: legislation we've passed, because one thing we know about this administration,
Speaker 13: they've had a habit of trying to convince the American
Speaker 13: public to feel something that they simply don't, hence those
Speaker 13: low approval ratings Tyler was just talking about. So you know,
Speaker 13: I am hoping that he could try to do this
Speaker 13: in a different way, which would be to come to
Speaker 13: it with a bit of humility and honesty about where
Speaker 13: the American public finds itself.
Speaker 7: And nobody is.
Speaker 13: Better positioned to do that than Joe Biden fifty years
Speaker 13: in Washington, d C. So I think there's a way
Speaker 13: to do it. I'm not sure he's going to get there,
Speaker 13: and that is my concern. So I will be watching
Speaker 13: with you tonight, Kayley, with baited breath, to see if you.
Speaker 7: Can get there.
Speaker 4: We'll be watching together with Rick and Jeanie. They'll be
Speaker 4: with us as part of our special coverage, and I'm
Speaker 4: guessing Rick that this will be fine tuned until the
Speaker 4: last moment, until it's loaded into the teleprompter. Not unlike
Speaker 4: a State of the Union, give us a sense of
Speaker 4: what's happening behind the scenes right now, especially in light
Speaker 4: of what appears to be a massive developing story in
Speaker 4: the Middle East.
Speaker 14: Yeah, that's right. I mean, there is a paragraph that's
Speaker 14: probably been altered as we speak around the Middle East
Speaker 14: peace process. So that's probably one of them that's getting
Speaker 14: hacked up. But look, Joe Biden is a medaler, right.
Speaker 14: He loves to take speeches right in the columns, change
Speaker 14: things right to the last minute. I mean, the worst
Speaker 14: job in the world is being the teleprompter operator on
Speaker 14: a Biden you know, campaign or in the White House,
Speaker 14: because he's getting changes all the way up to the
Speaker 14: time they go broadcast. So but these are more refinements.
Speaker 14: The substance of his administration is baked, right. We know
Speaker 14: the good news and the bad news. And as indicated,
Speaker 14: the public is basically checked out on the Biden presidency.
Speaker 14: He's not going to leave a popular president, but he'll leave.
Speaker 4: He'll will leave.
Speaker 14: As a president who accomplished many things, regardless of whether
Speaker 14: you liked what he did or not. And so this
Speaker 14: is his chance of sort of setting the record the
Speaker 14: way he wants it and actually blow through a little
Speaker 14: bit of the clouds around the economy. I mean, we
Speaker 14: have the most robust economy of any departing president I
Speaker 14: can remember, especially one that has an approval rating sub
Speaker 14: for percent, And so I would think that he would
Speaker 14: want to try one more time to convince the American
Speaker 14: public that the economic benefits that he brought to the
Speaker 14: administration are enduring, will last through the next administration, and
Speaker 14: that they were done by his policies and his policies alone.
Speaker 2: Well, which might bring it back to some of the
Speaker 2: legislative accomplishments that Genie is not so sure he should
Speaker 2: be trying.
Speaker 6: Too much to talk about.
Speaker 2: But Genie, on that note of the economy, something he
Speaker 2: has long struggled with, how quickly do you think American
Speaker 2: minds could change their hindsight view of Joe Biden if
Speaker 2: indeed we do see improvements in the economy, more infrastructure
Speaker 2: projects actually being completed in relatively short order, or is
Speaker 2: that all going to be things that Donald Trump gets
Speaker 2: credit for because he'll be in the oval office next No.
Speaker 13: I think overtime people's views will evolve, is probably the
Speaker 13: best way to say it. On Joe Biden, as they
Speaker 13: do on all modern presidents, and Donald Trump in office
Speaker 13: will have the same challenges any president in sitting in
Speaker 13: the office has. And you know, the reality is is
Speaker 13: that if Joe Biden rather tries again tonight like Rick
Speaker 13: is urging him too, It is again like trying to
Speaker 13: convince somebody who doesn't want to date you, to date you.
Speaker 13: We've gone through this for the last four years, Like,
Speaker 13: stop telling people things are going great. You know, He's
Speaker 13: Brick's right on the numbers. The economy looks good. But
Speaker 13: the American public spoke during the election. They are not happy.
Speaker 13: And it's not just Republicans, it is Democrats as well.
Speaker 13: And as we just look at what's happening in the
Speaker 13: Middle East, Democrats in particular are saying two million people
Speaker 13: forty six thousand people on the Gaza Strip killed. Please
Speaker 13: stop celebrating these wins. So he's got to be very
Speaker 13: careful about how he threads this needle. He's not in
Speaker 13: an advantageous position. There's a lot we need to thank
Speaker 13: Joe Biden for, but I think the way in which
Speaker 13: they do this, he's got to be careful. But I'm
Speaker 13: not sure he's listening either to his advisors, speech writers,
Speaker 13: or certainly he's.
Speaker 6: Not to me.
Speaker 13: So you know, I think we'll just have to wait
Speaker 13: and see how he.
Speaker 7: Tries to do this.
Speaker 4: Likely to strike a tone of optimism, I think we
Speaker 4: can expect Rick Davis, But you know, five days from now,
Speaker 4: there's another important speech to be delivered, and that's Donald
Speaker 4: Trump's inauguration speech. We remember kind of the dark, dystopian
Speaker 4: world he described in his first inaugural address. What do
Speaker 4: you think they're working on now?
Speaker 14: Yeah, we were just getting used to Donald Trump as
Speaker 14: president in twenty seventeen. In January for his innaugur address,
Speaker 14: and we're shocked by how dark and dismal he described
Speaker 14: not just the United States but the rest of the world.
Speaker 14: I do think he has changed somewhat turning the campaign.
Speaker 14: He even though I would say, was more pessimistic about
Speaker 14: the economy. I don't know if that was a device
Speaker 14: to just make all the things that are bad in
Speaker 14: your life. Ne're from Joe Biden, But yeah, it would
Speaker 14: be hopeful that he talks about his solutions to the
Speaker 14: problems rather than just an iteration of how bad people
Speaker 14: have it, because I do think there's a chance he
Speaker 14: talks past people and how they feel today. When we
Speaker 14: do look at surveys and especially consumer indexes, people actually
Speaker 14: feel pretty good about their personal situation. They worry, as
Speaker 14: Donald Trump has pounded into them, that the future is
Speaker 14: not bright. And so we'll see this is also his
Speaker 14: last term in office. We're now seeing a lame duck president.
Speaker 14: Leaving office and a lame duck president entering office a
Speaker 14: first time in our lifetime that we'll have actually witnessed this,
Speaker 14: And so how does that play out in both men's
Speaker 14: speeches both tonight and a week.
Speaker 4: For about that's something else.
Speaker 2: Yeah, well, except that the lame duck president who's entering
Speaker 2: office will be working with something that the outgoing president
Speaker 2: hasn't been working with for the last two years, which
Speaker 2: is Republican control of both chambers of Congress. So realistically,
Speaker 2: at least in the first two years of what's going
Speaker 2: to be a lame duck four years, Rick, he still
Speaker 2: has the ability to get quite a lot done.
Speaker 14: Yeah, and look, I mean Joe Biden said he was
Speaker 14: going to be a lame duck and then change his mind.
Speaker 14: Let's hope Donald Trump he doesn't have the same options.
Speaker 14: But yeah, he's got a good run, certainly for the
Speaker 14: next two years before mid terms, with a compliant House
Speaker 14: and a compliant Senate. And I think they're doing everything
Speaker 14: they can to front load this administration in order to
Speaker 14: do as much as they can in these first two years.
Speaker 4: A lame duck on the way out, a lame duck
Speaker 4: on the way in, Jeanie. A Republican majority of one
Speaker 4: in the House, how's anything going to get done?
Speaker 13: It's going to be hard, And you all just reminded me.
Speaker 13: I was listening to Pam Bondi's hearings and she was
Speaker 13: asked by one of the senators, can Donald Trump run
Speaker 13: again or is he term limited out? And she said,
Speaker 13: unless we change the constitution, he is term limited out.
Speaker 7: So presumably that's right.
Speaker 13: But this is actually an enormous concern because you know,
Speaker 13: there's one thing Donald Trump doesn't dound to be described
Speaker 13: at because that is lame.
Speaker 7: So I'm not sure he's going to like that monitor.
Speaker 13: But he did say this is it for him.
Speaker 7: There's that he.
Speaker 4: Doesn't like that. He doesn't like the Donald Duck thing either,
Speaker 4: so I'm not sure that name is going to work
Speaker 4: in either regard, although he did say if elected, we'd
Speaker 4: never have to vote again. Seriously, not literally. Our panel,
Speaker 4: we're going to let that one hang there. Jemmie Shanzo
Speaker 4: and Rick Davis, thank you both. As always our signature panel.
Speaker 4: They're going to be back in our special coverage. As
Speaker 4: Kaylee mentioned eight pm Eastern time, the address we've been
Speaker 4: talking about after fifty three years in public service, in
Speaker 4: public life, Joe Biden says, farewell from the Oval Office,
Speaker 4: and we'll have a lot more on that. It's going
Speaker 4: to be interesting to see how the speech is written
Speaker 4: and how it's delivered.
Speaker 2: Yeah, especially on the economy, as he is going to
Speaker 2: be speaking on a day when we got inflation data
Speaker 2: that at least the market seems pretty happy about.
Speaker 4: We're going to get should accomplished here.
Speaker 6: I wouldn't go that far.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
Speaker 1: us live weekdays at noon and five pm Eastern on Apple,
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Speaker 1: live on YouTube.
Speaker 4: Kaylee, we are obsessed with the core right, but energy
Speaker 4: prices are something that we all need to manage, and
Speaker 4: with crude oil bumping up against eighty dollars a barrel here,
Speaker 4: there are questions about where we're going in the immediate
Speaker 4: term and whether Donald Trump can make good on a
Speaker 4: promise to cut energy prices by half. This was part
Speaker 4: of the conversation today in one of many confirmation hearings
Speaker 4: underway on Capitol Hill. Chris Wright Liberty Energy. We told
Speaker 4: you about this tap by Donald Trump to run the
Speaker 4: Energy to Apartment. This is from his testimony in the
Speaker 4: Senate earlier today.
Speaker 15: Federal policies today make it too easy to stop projects
Speaker 15: and very hard hard to start and complete projects. This
Speaker 15: makes energy more expensive and less reliable. President Trump is
Speaker 15: committed to lowering energy costs, and to do so, we
Speaker 15: must prioritize cutting red tape, enabling the private sector investments,
Speaker 15: and building the infrastructure we need to make energy more
Speaker 15: affordable for families and businesses.
Speaker 4: Just the right voice for this conversation now is Tom
Speaker 4: Close Up back with us on Bloomberg, Global head of
Speaker 4: Energy Analysis at Opus. Tom, it's great to see you,
Speaker 4: Welcome back. I hope the years start now well for you,
Speaker 4: and we want to get into a lot of different
Speaker 4: things here with regard to energy prices and your forecast
Speaker 4: for the new year. But based on what you're hearing
Speaker 4: from the Trump team, which you heard today in this
Speaker 4: confirmation hearing, on what Donald Trump was saying even on
Speaker 4: the campaign trail, based on the baseline he has to
Speaker 4: come into office, is it possible to cut energy prices
Speaker 4: by fifty percent this year?
Speaker 16: I don't think it's possible to cut a buy fifty percent.
Speaker 16: But I think that he set out for a reasonable task.
Speaker 16: I think you'll hear them talk about three million barrels
Speaker 16: of oil equivalent in the Trump term, and that's actually
Speaker 16: like me shooting under one hundred golf. That's not a
Speaker 16: herculean task because we'll probably add about six hundred thousand
Speaker 16: barrels a day under normal circumstances. We'll add plenty of
Speaker 16: natural gas, and then gas liquids get attached in that.
Speaker 16: So that's a reasonable view half the price. No, And
Speaker 16: as a matter of fact, right now, inflation is alive
Speaker 16: and well in the oil business. We're up about eleven
Speaker 16: or twelve percent so far in twenty twenty five. Nothing
Speaker 16: to do with Trump policies for the most part, although
Speaker 16: a lot of nervousness and uncertainty about what the tariffs
Speaker 16: might do to prices.
Speaker 2: Well and how much of what we've seen most recently
Speaker 2: tom is also attributable to the tightening of sanctions on
Speaker 2: Russian oil, specifically that the Biden administration has finally agreed
Speaker 2: to in its waning days.
Speaker 16: Yeah, that's part of it. These sanctions for the first
Speaker 16: time really have teeth. Remember when Russia invaded Ukraine, we
Speaker 16: thought that, oh, they were going to have impede impediments
Speaker 16: of several million barrels a day of the crude they
Speaker 16: sense of the world. What happened was it just got
Speaker 16: re routed and China and India took most of it.
Speaker 16: This time, it looks as though it might be a
Speaker 16: cutting production by about seven hundred thousand barrels a day,
Speaker 16: So for the short term, that helps. The other thing
Speaker 16: I have to really emphasize is that we're in the
Speaker 16: season where oil prices go up. Oil prices are not
Speaker 16: like a Tarantino movie or you know, a movie by
Speaker 16: the Coen Brothers. It's more like you know the Hallmark
Speaker 16: movie where you know the plot pretty much when you
Speaker 16: tune in, and the plot for the first one hundred
Speaker 16: days of any year is usually for higher prices. So
Speaker 16: I think we're going to go onward and upward in
Speaker 16: this first hundred days. Will be above eighty for WTI shortly,
Speaker 16: and will probably be in the mid to high eighties
Speaker 16: for Brent. But then this is a front end loaded year.
Speaker 16: I mean, by the end of the year, and perhaps
Speaker 16: the Trump administration may take credit for this, we're going
Speaker 16: to see a lot lower prices in the second half
Speaker 16: of the year than what we see in the first
Speaker 16: hundred days.
Speaker 4: All right, so no plot twists coming in the immediate term, Tom,
Speaker 4: I wonder we've been asking about oil here should we
Speaker 4: be asking you instead about natural gas. Everyone is submitting
Speaker 4: the President elect to lift the moratorium on LNG exports.
Speaker 4: Is it going to be boom times this year?
Speaker 16: I don't think so. I think those are mostly you know,
Speaker 16: a lot of the things that the Biden administration did
Speaker 16: were you know, we're measured, you know, in terms of
Speaker 16: it doesn't really makes sense to have a moratorium on
Speaker 16: LNG when we are going to be the Saudi Arabia, Russia, US,
Speaker 16: and Persian Gulf of the world for natural gas. The
Speaker 16: thing the watch about natural gas is this, we have
Speaker 16: plenty of it, and we have plenty of it in
Speaker 16: the ground that we can bring to market. But when
Speaker 16: you get a cold winter in the northern hemisphere, and
Speaker 16: this really qualifies as a cold winter, you can have
Speaker 16: all sorts of problems. You've got plenty of gas natural
Speaker 16: gas in Henry Hub, but you don't have it in
Speaker 16: New York, Boston, Chicago and places that need it. For
Speaker 16: commercial businesses, there's a really good chance next week that
Speaker 16: we're going to have what they call natural gas urtailments
Speaker 16: or interruptions, where you know, maybe you're a pizza parlor
Speaker 16: and you get cut off on natural gas when the
Speaker 16: residents and the hospitals and the schools eat it. And
Speaker 16: when that happens, a lot of those commercial customers turn
Speaker 16: to oil and they buy diesel, jet fuel, kerosene, heating oil,
Speaker 16: you name it. And there really looks like there's a
Speaker 16: good chance that we could get a little bit of
Speaker 16: a sticker shock for some of the middle of the
Speaker 16: barrel products next week.
Speaker 2: Well, of course, next week also brings with it the inauguration.
Speaker 2: To get to where we started this conversation, the impact
Speaker 2: that Donald Trump's administration will have. You mentioned in your
Speaker 2: first answer Tom this question around what tariffs ultimately are
Speaker 2: going to mean, and that in theory points us toward Canada,
Speaker 2: where the US is getting a lot of this product from.
Speaker 2: What would happen if we were to see a twenty
Speaker 2: five percent tariff implemented on all Canadian goods, energy products included,
Speaker 2: What would the immediate translation be on prices here in
Speaker 2: the US?
Speaker 16: The immediate translation would be the Canadian companies would really suffer.
Speaker 16: I mean they are stranded producers. Now. Some of the
Speaker 16: refiners in the US Midwest and in the Rocky Mountains
Speaker 16: are stranded customers, and they need Canadian crew to run on.
Speaker 16: You know, there's a lot of US crew. But it's
Speaker 16: very very light, and it's very very sweet, and it
Speaker 16: makes too much gasoline and propane and buttane and things
Speaker 16: like that. So we're very dependent on Canadian crude. I
Speaker 16: got to tell you, I don't know what's going to happen.
Speaker 16: I pull it the circus of uncertainty, and I don't
Speaker 16: know which of the three rings is going to be
Speaker 16: open because we don't know how they're going to collect
Speaker 16: the twenty five percent tariff. I assume that it would
Speaker 16: be on Mexico as well. But I think ultimately it
Speaker 16: moves into that narrative of higher prices in the first
Speaker 16: one hundred days of the year, and then the market
Speaker 16: will make an adjustment for it. I mean, Canadian crude,
Speaker 16: which sells for about thirteen dollars under WTI now may
Speaker 16: sell for thirty dollars under by the time the second
Speaker 16: half of the year comes around.
Speaker 2: Tom we're just getting some breaking news regarding the ceasefire
Speaker 2: agreement between Israel and Hamas. Both Cutter and now the
Speaker 2: White House have said an agreement has been reached and
Speaker 2: a ceasefire will begin on Sunday. A statement just released
Speaker 2: from the White House show says after many months of
Speaker 2: intensive diploma to see Israel and Hamas have reached a
Speaker 2: ceasefire and hostage deal. This deal will halt the fighting
Speaker 2: and Gaza surge, much needed humanitarian assistance to Palestinian civilians,
Speaker 2: and reunite hostages with their families after more than fifteen
Speaker 2: months in captivity. And we will hear remarks from the
Speaker 2: President on this pretty soon.
Speaker 4: He says, I will speak more about this soon, Kayley,
Speaker 4: suggesting he may be speaking from the White House ahead
Speaker 4: of his scheduled farewell address which is at eight pm.
Speaker 4: While we have Tom close on the line, Tom, you
Speaker 4: may or may not have seen this coming. While it
Speaker 4: lowers potentially the political temperature in the Middle East, what
Speaker 4: does it mean for energy markets? Is this good news
Speaker 4: or a non factor?
Speaker 16: It's probably a non factor. Here's the interesting thing. When
Speaker 16: the Moss War broke out on October seventh, you didn't
Speaker 16: really see much of a reaction in oil, and I
Speaker 16: would submit that oil has really lost a lot of
Speaker 16: the speculative flavor that had had oh back with the
Speaker 16: Arab spring years or back in two thousand and seven,
Speaker 16: in two thousand and eight. There's so many better places
Speaker 16: to sort of speculate about price appreciation. You have crypto,
Speaker 16: which is probably attracting about four trillion, and you have
Speaker 16: big tech, and those companies didn't exist when crude oil
Speaker 16: futures first started, and now they're worth about seventeen trillion dollars.
Speaker 16: So we never really saw the positioning go to where
Speaker 16: people were betting on higher prices after the massage Israeli war.
Speaker 16: So I don't think there's much of a reaction now
Speaker 16: that there's peace and God, we all hope that this
Speaker 16: is a lasting piece in the region.
Speaker 2: All right, Tom, thank you so much for joining us.
Speaker 2: Tom close, of course is with Opus.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 4: Here in Fortress, Washington. It has been incredible to try
Speaker 4: to get around here. And if you're coming to the
Speaker 4: inaugural I'm going to give you a big warning right now.
Speaker 4: You won't even recognize it. With thirty miles that's three
Speaker 4: zero miles of security fencing, that's like ten twelve feet tall,
Speaker 4: the big black the stuff they put around the Capitol
Speaker 4: for January sixth, it's basically wrapping the whole city. The
Speaker 4: streets are being closed and Washington is ready. When I
Speaker 4: came in this morning, an army I don't know where
Speaker 4: they get these guys, but an army of people shoveling
Speaker 4: snow drifts off of Pennsylvania Avenue to make room for
Speaker 4: more security gates for the big inaugural parade. We'll be
Speaker 4: ready for you when you get here. Confirmation hearings taking
Speaker 4: place on Capitol Hill as we speak. And now we
Speaker 4: got the big breaker. You gotta love Bloomberg. I know
Speaker 4: you do. That's why you're here, whether you're on the
Speaker 4: radio and satellite radio, YouTube, maybe you catch us on TV.
Speaker 4: If it was on Monday, you knew what was coming
Speaker 4: today because Jake Sullivan was here the President's National security
Speaker 4: advisor to let us know what was happening with the
Speaker 4: potential ceasefire in the Middle East. Remember here's what he said.
Speaker 3: I think the pressure is building for Hamas to come
Speaker 3: to yes. I think Israel also has achieved a huge
Speaker 3: amount of its military objectives in Gaza, and therefore they
Speaker 3: are in a position to be able to say yes.
Speaker 3: So there is a distinct possibility that we can get
Speaker 3: this deal done this week.
Speaker 4: This week, here we are on Wednesday, ceasefire just announced.
Speaker 4: If you're joining us, Israel and Hamas have agreed to
Speaker 4: a deal now that brings at least a temporary halt
Speaker 4: to the war, of course in Gaza, but also means
Speaker 4: the release of hostages. More than fifteen months of fighting
Speaker 4: under their belts. Now there is little left of Gaza,
Speaker 4: and we're looking at the potential for some thirty three
Speaker 4: hostages now to be released. We have a lot of
Speaker 4: questions about this, of course, details is the President going
Speaker 4: to talk later today. We'll be talking to some smart
Speaker 4: people about it along the way. But from a military
Speaker 4: standpoint here and from a national security standpoint, we have
Speaker 4: a lot of questions, and that's why we're lucky to
Speaker 4: be joined by Rebecca Grant, vice president of the Defense
Speaker 4: Program at the Lexington Institute. Rebecca, it's good to have you.
Speaker 4: It's been too long, and we welcome you back to Bloomberg.
Speaker 4: I wonder your thoughts here. As I mentioned, after fifteen
Speaker 4: months of war, in many cases with support from the
Speaker 4: United States military either by way of intelligence, we've seen
Speaker 4: a couple of counter attacks against Israel from Iran in
Speaker 4: this time, all going back to October seventh. What are
Speaker 4: the lessons learned here for the United States from a
Speaker 4: military standpoint?
Speaker 17: Well, this is such a big achievement, and none of
Speaker 17: this would have been possible without the thirty to thirty
Speaker 17: five thousand US forces that have been deployed to Central Command.
Speaker 17: That augmentation started right after October seventh, twenty twenty three.
Speaker 17: It's involved, for example, five different aircraft carriers that have
Speaker 17: rotated through to keep a lid on Iran and to
Speaker 17: assist Israel in their defense against Iran's missiles. So a
Speaker 17: ton of credit to the US military forces. They're all branches,
Speaker 17: air force, fighters, bombers, you name it, really helping to
Speaker 17: keep a lid and then give the pressure on hamas well.
Speaker 4: You were last here, Rebecca, right around the time we
Speaker 4: were sending an additional carrier strike group into the regions.
Speaker 4: So I know that you're steeped in all of this.
Speaker 4: Will we maintain a similar footprint, a similar posture following
Speaker 4: Joe Biden's departure from the White House and following I
Speaker 4: guess the implementation of this cease fire.
Speaker 17: Deal, and that's going to be one of President Trump's
Speaker 17: biggest set of decisions, what to do with the Mid
Speaker 17: East force posture. I don't expect any changes right away,
Speaker 17: because we'll want to keep the destroyers there that do
Speaker 17: balistic missile defense. We're also still guarding the Red Sea
Speaker 17: shipping lanes, and then we're doing force protection for our
Speaker 17: own US forces in Iraq, and then there's always Syria.
Speaker 17: But longer term, what President Trump wants is peace in
Speaker 17: the Middle East built around the normalization of relations between
Speaker 17: Saudi and Israel, and this Trumpet presidency, we need to
Speaker 17: see a smart and calculated draw down of US forces
Speaker 17: in the Middle East so that they can go to
Speaker 17: other places in the world where we need them, China
Speaker 17: if necessary.
Speaker 4: Over the course of this fifteen months, the US policy
Speaker 4: in Israel became very controversial, among progressive Democrats many others
Speaker 4: who were critical of the Biden administration approach, specifically here
Speaker 4: when it came to essentially allowing in their words, and
Speaker 4: I know that this is very controversial, but allowing civilian
Speaker 4: deaths even as we provided military support to Israel. I
Speaker 4: know Joe Biden urged restraint repeatedly in caution in his
Speaker 4: meetings with Benjamin Netan Yahoo. But at one point there
Speaker 4: were lawmakers Rebecca threatening to hold back or change to
Speaker 4: some degree lessen our military support to Israel, in fact,
Speaker 4: stall the shipment of weapons programs until certain conditions were met.
Speaker 4: Are those lawmakers going to be silent in a Trump administration?
Speaker 4: I'm assuming this is going to be all in on Israel.
Speaker 17: Well, I think that what we've seen in the end
Speaker 17: is very strong support for Israel. It's been a tragic war,
Speaker 17: of course, but remember it's Hamas that put their military
Speaker 17: capabilities in amongst civilians and led to that in the end,
Speaker 17: we did not stop shippments to Israel. Quite the contrary,
Speaker 17: We've continued to support Israel with munitions, and of course
Speaker 17: Israel has made great use of the US designed F
Speaker 17: thirty five that they used as a fighter jet to
Speaker 17: take down Iran's air defenses. So Israel's security is paramount.
Speaker 17: It's the cornerstone of stability in the Middle East. The
Speaker 17: US is going to continue to support that heavily, and
Speaker 17: I hope take a lot of lessons learned, particularly in
Speaker 17: the drone and missile defense regions, from what we've seen
Speaker 17: Israel do as they have restored Israeli security.
Speaker 4: I wonder from a greater standpoint, what your expectation is
Speaker 4: for procurement reform at the Pentagon under a Trump administration,
Speaker 4: the weapons programs that we might be looking at the
Speaker 4: level of spending. We keep hearing Rebecca about the first
Speaker 4: trillion dollar defense budget. Ever, Marco Rubio is testifying. A
Speaker 4: lot of people think it'll be a very easy move
Speaker 4: for him to become the Secretary of State, but testifying
Speaker 4: in his confirmation hearing earlier, he talked about the triumphalism
Speaker 4: that followed the Cold War and the sleepwalking essentially that
Speaker 4: we did, thinking that, as he put it, all mankind
Speaker 4: was destined to abandon national sovereignty. He called it a
Speaker 4: fantasy and a dangerous delusion, and I wonder how that
Speaker 4: informs your view on the way this administration will not
Speaker 4: only approach diplomacy but military spending.
Speaker 17: Well, we're all wide awake now with Iran, with the
Speaker 17: Russia China alliance. Actually, I think Santor Rubio has done
Speaker 17: a fantastic job laying out the importance of American safety, strength,
Speaker 17: and prosperity. You know, he's the A plus student of
Speaker 17: this round of Cabinet nominees and is doing a superb job.
Speaker 17: And I look forward to his leadership as Secretary of State.
Speaker 17: But the fact is we are facing a lot of
Speaker 17: problems around the world and a real challenge in maintaining
Speaker 17: US leadership. Back to the military side, defense budgets are big,
Speaker 17: but in real growth terms they've been flat.
Speaker 6: We spend a lot less.
Speaker 17: Now on defense than we did back in the Cold
Speaker 17: War or even in the Reagan build up. So I
Speaker 17: want to see some smart reform, but I also want
Speaker 17: to see US invest in technology, to stay ahead in AI,
Speaker 17: to make the transition to drones and unmanned systems, and
Speaker 17: of course to pay our service members appropriately.
Speaker 6: But look, mcno mistake, We're not going to be.
Speaker 17: Able to do a big cut back in the defense
Speaker 17: budget because our military is our global insurance.
Speaker 5: Policy.
Speaker 6: Is that simple m Well.
Speaker 4: We heard from Marco Rubio on that insurance policy when
Speaker 4: it comes to China, specifically Rebecca earlier today and the
Speaker 4: confirmation hearing. Here's what he said.
Speaker 9: We welcome the Chinese Communist Party into the global order,
Speaker 9: and they took advantage of all of its benefits and
Speaker 9: they ignored all of its obligations and responsibilities. Instead, they
Speaker 9: have repressed and lied, and cheated and hacked and stolen
Speaker 9: their way into global superpower status. And they have done
Speaker 9: so at our expense and at the expense of the
Speaker 9: people of their own country.
Speaker 4: I don't want to get too abstract on you here,
Speaker 4: Rebecca Grant, but what's the war that we're supposed to
Speaker 4: be preparing for if it is in fact China that
Speaker 4: is our greatest threat. I think you've got a picture
Speaker 4: of an aircraft carrier behind you. There. Is that the
Speaker 4: approach that we're tanking, we're taking as a carrier, strike groups, tanks, missiles,
Speaker 4: or should we be building drones and creating new cyber
Speaker 4: warfare weapons that we've never used.
Speaker 17: Well, it's all of the above. And don't forget the
Speaker 17: space domain, where China is very active and wanting to
Speaker 17: assert control and China has weapons that can hit our
Speaker 17: satellites up in orbit. So big picture, I love what
Speaker 17: sender Rubio is saying. This is now basically official US policy.
Speaker 17: We know that we let China into the game. They
Speaker 17: were no good, and we're going to have a big
Speaker 17: job to get out of it. That starts with military strength,
Speaker 17: taking lessons learned from Ukraine and applying them to see
Speaker 17: control in the Pacific. But it also will really mean
Speaker 17: a lot of economic steps. I do expect to see tariffs,
Speaker 17: I want to see AI export control regulations, but also
Speaker 17: a boost to our great tech leaders. We have a
Speaker 17: significant lead over China in AI. Keeping that lead is
Speaker 17: something our big corporations will help us do, and we've
Speaker 17: got to make sure that we keep it. And then
Speaker 17: we do have to integrate drones and all this other
Speaker 17: new technology into what the military calls all domain warfare
Speaker 17: to deter China. Yeah, and finally, don't forget China's building
Speaker 17: more nuclear weapons and they don't do arms control, so
Speaker 17: we'll have to be very serious on the strategic deterrent
Speaker 17: side as well.
Speaker 4: I need an hour with you, but I only have
Speaker 4: a minute left. We're going to see a new stealth
Speaker 4: bomber apparently we heard Pete Hagsith talk about B twenty one.
Speaker 4: Do we see an next generation fighter under the Trump administration?
Speaker 6: I hope.
Speaker 17: So we need the B twenty one with a second
Speaker 17: production site, build more of those raiders. China's real afraid
Speaker 17: of them, and I'd like to see a Secretary of
Speaker 17: Defense hegseeth green light the next generation air dominance, the
Speaker 17: new Air Force fighter that's ready to go. China's already
Speaker 17: experimented with some of their answers. We want to see
Speaker 17: that dominant US airpower get the green light.
Speaker 4: I saw those images of that Chinese stealth fighter flying
Speaker 4: around the Delta thing. I thought, if you I don't,
Speaker 4: is this real? You need to come back soon. Tell
Speaker 4: us when you're back. Rebecca Grant Lexington institute the perfect
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