WEBVTT - NEC Director Kevin Hassett Talks Jobs Numbers, AI

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>We welcome our Bloomberg TV and radio audience. I'm Danny Berger.

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<v Speaker 2>And we saw US jobs jumping one hundred and fifteen

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<v Speaker 2>thousand in April. It beats estimates, marking the first back

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<v Speaker 2>to back gain in nearly a year. Joining us now

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<v Speaker 2>and please to say is the White House Director of

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<v Speaker 2>Economic National Economic Council, Kevin Hassett. Director Hasset, thank you

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<v Speaker 2>so much for joining a strong jobs number a beat.

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<v Speaker 2>Let me just get your initial reaction right.

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<v Speaker 1>Well, you know, two months in a row now we've

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<v Speaker 1>had blackbuster jobs numbers. And the really interesting thing is

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<v Speaker 1>that we look at these things that you guys do too,

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<v Speaker 1>I'm sure, called heat maps where you look by category,

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<v Speaker 1>like where's the green and where's the red, and pretty

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<v Speaker 1>much it was green across the board. And so what

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<v Speaker 1>it means is it's a rip roarin jobs market. And

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<v Speaker 1>it's completely consistent with what we saw with the claims

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<v Speaker 1>data just a few days ago, right like, initial claims

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<v Speaker 1>for unemployment churns right now are the lowest since we've

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<v Speaker 1>ever been counting them.

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<v Speaker 3>All the way back to the iteen sixties. And so

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<v Speaker 3>the job market is really, really really strong, Kevin.

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<v Speaker 2>Part of the issue though, that people would folk to

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<v Speaker 2>focus on is the fact that the job's creation is narrow.

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<v Speaker 2>It's in issues like healthcare. Meanwhile, we saw financial jobs down,

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<v Speaker 2>tech jobs down. These are exactly the type of categories

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<v Speaker 2>you would expect if AI is having an impact on

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<v Speaker 2>jobs in this economy. Is there a plan from this

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<v Speaker 2>administration to combat job loss over AI's impact.

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<v Speaker 1>Well, right now, what we're seeing is the AI is

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<v Speaker 1>creating job creation. There are a couple of new studies

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<v Speaker 1>out at the National girl of Economic Research that show

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<v Speaker 1>and one at Stanford University that show that AI adjacent

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<v Speaker 1>jobs at AI adjacent professions are actually increasing faster than

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<v Speaker 1>everywhere else. But of course, in the medium to long term,

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<v Speaker 1>people are right to be concerned about what might AI

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<v Speaker 1>mean for them. But right now, the very very best

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<v Speaker 1>thing that you could do in order to protect yourself

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<v Speaker 1>and protect your career is start to use AI tools

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<v Speaker 1>yourself to make yourself more productive.

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<v Speaker 3>And that's what we're seeing the data.

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<v Speaker 2>Guess, Kevin, will there be a point where the White

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<v Speaker 2>House needs to address this. I've talked to many, many

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<v Speaker 2>people who say that twenty twenty eight, the election will

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<v Speaker 2>be centered around AI and what politicians are saying about it.

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<v Speaker 2>You're already seeing hints of it in twenty twenty six.

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<v Speaker 2>Does there need to be a clear plan going forward

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<v Speaker 2>if there are huge economic consequences of what AI does?

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<v Speaker 1>Absolutely, of something that's being very very careful, carefully studied

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<v Speaker 1>by all of government. We've got five different work plans

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<v Speaker 1>depending on which direction we're going, what topic it is,

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<v Speaker 1>whether it's AI and the workforce, AI and security and

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<v Speaker 1>so on, and these have been underway since President Trump

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<v Speaker 1>took office. Really so absolutely, we're working through policy options

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<v Speaker 1>as we watch.

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<v Speaker 3>The data evolve.

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<v Speaker 1>But right now, where we are sure to see the

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<v Speaker 1>AI adjacent jobs are the ones that are growing the fastest.

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<v Speaker 1>And so the story the AI is destroying people's jobs

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<v Speaker 1>right now is not anywhere in the data. But we

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<v Speaker 1>can imagine, we can imagine things, especially once robots get

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<v Speaker 1>better and better, then we're going to have to have

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<v Speaker 1>more policies to help people, you know, reskill and so

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<v Speaker 1>a lot.

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<v Speaker 2>So in the meantime, as you say the figures are

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<v Speaker 2>strong for this jobs market, doesn't that essentially kill any

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<v Speaker 2>hopes of a rate cut this year?

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<v Speaker 3>You know?

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<v Speaker 1>For me, I think that when we have a strong

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<v Speaker 1>supply sock, then that means that there's downward pressure on

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<v Speaker 1>inflay should and that's what we're seeing. And in fact,

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<v Speaker 1>even with the oil prices going up, excuse me for

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<v Speaker 1>the big truck threading byby look, even when the oil

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<v Speaker 1>price is going up, you saw core inflay should remain stable.

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<v Speaker 1>And you could even see that in the wage data

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<v Speaker 1>in today's jobs report, where there were strong wage growth

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<v Speaker 1>but not anything that was a sign of the kind

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<v Speaker 1>of runaway Philip's curb inflationhold that should make the FED

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<v Speaker 1>want to lift Rakes.

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<v Speaker 2>Well, I suppose, Kevin. Last time you were on the

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<v Speaker 2>show last Friday, after the CPI report, you mentioned that

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<v Speaker 2>you were looking forward to a wash FED share because

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<v Speaker 2>of the independence it would bring to the FED. Since then,

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<v Speaker 2>we've learned more about the descents coming from the FOMC

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<v Speaker 2>that one of the language of the statement change to

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<v Speaker 2>take out any bias, any sort of easing bias. It

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<v Speaker 2>was three descents. You can make that four if you have,

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<v Speaker 2>Susan Collins adding as she spoke to Bloomberg, saying that

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<v Speaker 2>she agreed with that idea. Do you think that this

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<v Speaker 2>is an FOMC, at least those four members that are

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<v Speaker 2>gearing up to push back against a worsh fed shair.

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<v Speaker 1>Well, I can tell you speak specifically about Susan Collins.

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<v Speaker 1>I've known her since graduate school. She's an A plus

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<v Speaker 1>economist who goes where the evidence leads. Disappointed that these

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<v Speaker 1>people made the decision that they did, but I'm sure

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<v Speaker 1>that when Kevin Worf's fed shair, he'll have lots of

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<v Speaker 1>people that will be open to argument and open to evidence,

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<v Speaker 1>and he's a very persuasive guy. I think Kevin believes

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<v Speaker 1>as I do, that a supply shock is a time

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<v Speaker 1>when you don't have to lift rates just because you

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<v Speaker 1>have high growth. And I think that he'll bring lots

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<v Speaker 1>of evidence to bear and convince his colleagues. So I

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<v Speaker 1>think we're really likely to see rake cuts this year

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<v Speaker 1>because of Kevin.

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<v Speaker 2>Warsh ELSEWEUR Director. Last night, the Court of ISSI International

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<v Speaker 2>Trade once again declared unlawful President's teriffs, this time the

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<v Speaker 2>one twenty two duties on imports. When does the administration

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<v Speaker 2>plan to appeal this?

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<v Speaker 1>Well, you know, I think that we're studying all our

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<v Speaker 1>options right now, and Jameson Grier will have a message

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<v Speaker 1>out of that probably later today.

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<v Speaker 2>Are there are there any mechanisms in mind to keep

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<v Speaker 2>those tariffs in place or any other stop gap measures.

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<v Speaker 3>I'm going to leave that to the trade lawyers for you.

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<v Speaker 2>Okay, fine, I guess there is this bigger question than

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<v Speaker 2>if we're going to leave that part to the trade lawyers.

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<v Speaker 2>But the economic talks with China, then, does this put

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<v Speaker 2>the White House at a disadvantage as the President goes

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<v Speaker 2>to have those discussions with she next week?

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<v Speaker 1>You know, I don't think so, first of all, that

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<v Speaker 1>this affects, you know, one corner of the trade policy.

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<v Speaker 1>The strategy really is to finalize the deals that we

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<v Speaker 1>have negotiated over last year with three oh one's and

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<v Speaker 1>two thirty two's, two authorities that are basically ironclad in

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<v Speaker 1>the courts, and so the job has always been for

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<v Speaker 1>Jamison Greer to get ready to sort of finalize the

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<v Speaker 1>deals with these much stronger authorities. We believe the IEPA

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<v Speaker 1>authority that you originally use was a solid authority and

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<v Speaker 1>disagree with the court's decision that is forcing us to

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<v Speaker 1>refund the tariffs, But we have a backup plan that

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<v Speaker 1>is going to make sure that the President's trade policy

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<v Speaker 1>is made a reality very very shortly.

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<v Speaker 2>Okay, so a backup plan. Might we expect to hear

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<v Speaker 2>something today, Director has.

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<v Speaker 1>It excuse me from Jamison Greer, Yes, you you have.

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<v Speaker 2>To talk to him, Okay, Okay, fair enough.

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<v Speaker 3>I spoke with him yesterday about it.

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<v Speaker 2>Okay. I know it is fresh news. But again to

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<v Speaker 2>your point, the White House always looking for alternatives. What

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<v Speaker 2>about when it comes to the Europeans. The President has

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<v Speaker 2>sent this July fourth deadline to reach some sort of agreement.

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<v Speaker 2>Does this also complicate things?

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<v Speaker 3>Well, I don't know if it complicates things.

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<v Speaker 1>We've got lots of deep agreements with the Europeans and

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<v Speaker 1>they haven't really kept up their end of the bargain,

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<v Speaker 1>and that has the President pretty frustrated. But my expectation

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<v Speaker 1>is by the fourth of July that they will and

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<v Speaker 1>then we'll have these this pro America, pro worker trade

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<v Speaker 1>deal with Europe that has already been negotiated and agreed to.

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<v Speaker 2>Director Hasse. Before I let you go, there's been this

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<v Speaker 2>outstanding question of the debt piles in the United States

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<v Speaker 2>and what that means going forward and the need to

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<v Speaker 2>service that debt. We heard from Double Line Jeffrey Gunlock

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<v Speaker 2>speaking to Bloomberg TV, saying that he was positioning for

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<v Speaker 2>a world in which the government unilaterally lowers coupons on

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<v Speaker 2>existing US debt in order to manage those internal costs.

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<v Speaker 2>I just wonder what you think of that. Might that

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<v Speaker 2>be the direction that we had.

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<v Speaker 1>There's not a chance in a million years that this

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<v Speaker 1>administration would ever do anything that looks in any way

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<v Speaker 1>like a debt default. We believe in the strong dollar,

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<v Speaker 1>and we believe in a strong fiscal responsible government, and

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<v Speaker 1>so that's why we reduced the deficit last year by

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<v Speaker 1>hundreds of billions of dollars. We reduced federal employment by

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<v Speaker 1>the most it's ever been reduced. Actually, their fewer federal

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<v Speaker 1>employees right now in the US than there have been

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<v Speaker 1>in any year since World War Two. That's the kind

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<v Speaker 1>of fiscal responsibility the lifts confidence of the debt. And

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<v Speaker 1>you know, we're not done yet again with the growth

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<v Speaker 1>that we're seeing, the growth that was echoed in the

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<v Speaker 1>reports today and last month, you know, we absolutely are

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<v Speaker 1>seeing the kind of growth you need as you had

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<v Speaker 1>in the nineties, to get the deficits under control.

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<v Speaker 3>And that's our plan.

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<v Speaker 2>So of course, no way to do debt default but

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<v Speaker 2>might you look at restructuring it again in this way,

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<v Speaker 2>maybe lowering the coupon something like that.

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<v Speaker 1>There's absolutely nothing that we're going to do other than

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<v Speaker 1>be fiscally responsible.

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<v Speaker 2>All right, Director Kevin Hasset, thank you so much for

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<v Speaker 2>joining us after that one hundred and fifteen beat on

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<v Speaker 2>the jobs figures, that is, the national Director of National

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<v Speaker 2>Economic Council, Kevin Hassett, thank you so much.