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Speaker 2: We can't help but notice volumes a little bit light today,
Speaker 2: and I do wonder if there's a bunch of traders
Speaker 2: away from the desk post super Bowl blow out by
Speaker 2: the Eagles. Of course, a super Bowl that was at
Speaker 2: least in part attended by President Trump. He left early,
Speaker 2: maybe didn't like the halftime show, Maybe it was just
Speaker 2: for security and logistics purposes. But it wasn't so much
Speaker 2: about what he actually did at the super Bowl as
Speaker 2: the news he made around it, specifically on the plane
Speaker 2: on Air Force One when he gave us this on
Speaker 2: tariffs last night.
Speaker 3: I'll be announcing probably Tuesday or Wednesday at a news conference,
Speaker 3: reciprocal tariffs, and very simply, it's if they charge us,
Speaker 3: we charged them, that's all. It'll be great for everybody,
Speaker 3: including the other countries. But if they are charging us
Speaker 3: one hundred and thirty percent and we're charging them nothing.
Speaker 3: It's not going to say that way. We'll also be
Speaker 3: announcing steel tariffs on Monday. Any steel coming into the
Speaker 3: United States is going to have a twenty five percent
Speaker 3: terror a little bit of two.
Speaker 4: All right, that's a lot to unpack there, which we're
Speaker 4: going to do in a moment with and the current.
Speaker 5: Did you see the map behind him if you.
Speaker 4: Were with us on on Bloomberg TV or on YouTube.
Speaker 4: He actually gathered everyone there to talk about to cover
Speaker 4: what he said was a very more important moment. I
Speaker 4: think even than the super Bowl, which was Gulf of
Speaker 4: America Day. He made it a holiday instead of the
Speaker 4: Gulf of Mexico. That was as they were flying over
Speaker 4: for an important moment. There have the whole map on
Speaker 4: the easel. That's not again what we're here to talk
Speaker 4: about today, and occurrent covers the economy for us here
Speaker 4: with his eyes on the global economy and with us
Speaker 4: now at the table here we are again asking you
Speaker 4: about tariffs, and we don't know exactly where this is going.
Speaker 4: And I want to kind of pick apart what President
Speaker 4: Trump just said. There reciprocal tariffs one thing, steal and
Speaker 4: aluminum another. It could could end up scooping up a
Speaker 4: lot of countries in this action or will it Will
Speaker 4: there be exemptions when the president emerges a short time
Speaker 4: from now.
Speaker 6: Well, on paper, you're talking about key trading partners, yes,
Speaker 6: candidate creators. There's India as well, of course when it
Speaker 6: comes to a security alliance, and also obviously those European nations.
Speaker 6: So does go into the world of you know, is
Speaker 6: this competitive trade against a China or our allies being
Speaker 6: scooped up In the same book at we'll have city
Speaker 6: details gel in terms of when it gets them commended
Speaker 6: in Highland? Will there be exemptions? The reciprocal trade point,
Speaker 6: that's more technical and more complicated. Again we lead to
Speaker 6: the details, but as the President said, most trade experts
Speaker 6: this morning, we're saying, it's effectively, if the US sells
Speaker 6: goods to someone and they say, have a temperacent tariff
Speaker 6: for those goods and you only has a two percent
Speaker 6: tar if coming the other way around, well that's going
Speaker 6: to be leveled up. That's the thinking. But the interesting
Speaker 6: subplot coming out of that is people saying, maybe this
Speaker 6: is what the President's going to do instead of the
Speaker 6: universal tarff. Remember he had the idea of the universal
Speaker 6: turf of ten percent on everyone sure letters saying maybe
Speaker 6: he's going to go to this reciprocal way and do
Speaker 6: that instead of the universal.
Speaker 2: So is that how we make sense of the market's
Speaker 2: lack of real reaction, if you will ender or is
Speaker 2: this they're just waiting until something is final before trading
Speaker 2: on it, given our experience for the last two consecutive.
Speaker 6: Weeks, certainly waiting to see when it's a signed off
Speaker 6: and actually in action for sure. You know, the steel
Speaker 6: tariffs on their own are considered to be a game
Speaker 6: changer for either the US economy or the said, the
Speaker 6: Canadian economy. The Canadian the economy is involved in the
Speaker 6: world economy individually, maybe car companies and steal companies of
Speaker 6: coursal feeling impact, but in the bigger macro picture, the
Speaker 6: bigger focus remains on the broader trade policy, not just
Speaker 6: on these specific steel terrifts.
Speaker 5: This is, in fact an opening gambit.
Speaker 4: The last one took about twenty four hours, right, and
Speaker 4: Donald Trump ends up on the phone with the leaders
Speaker 4: of Canada, Mexico, many of the same players, with many
Speaker 4: more this time around. Whether that moves the needle, He's
Speaker 4: got his eyes on the EU coming up next, will
Speaker 4: will there be additional tariffs beyond steel and aluminum When
Speaker 4: it comes to EU.
Speaker 6: Members, well, all of the signaling and messaging the President
Speaker 6: has given is that yes, the EU's in is in
Speaker 6: for a sweep of the broom here as well. It's
Speaker 6: not just going to be steel. He's talking about ottos
Speaker 6: for example, the fact that unequal access to their markets.
Speaker 6: It's going to be food. I suspect it'll be across
Speaker 6: the board when it comes to EU. He has carved
Speaker 6: at the UK from that at times, making the point
Speaker 6: that their trade is doing okay, but there are other
Speaker 6: areas he wants to balance the books with the EU.
Speaker 6: But you know, remember this idea about negotiating tools and
Speaker 6: the like is there. But there was also an expectation
Speaker 6: of perhaps the tariffs retaliation tariffs that China has put
Speaker 6: on US goods wouldn't go into effect, that both leaders
Speaker 6: would talk, Yeah, that didn't happen. Those tariffs went into
Speaker 6: effect today on US goods going to going to China.
Speaker 2: So obviously a lot when it comes to tariffs remains uncertain,
Speaker 2: which does make me wonder tomorrow and Wednesday, when we
Speaker 2: see the chair of the Federal Reserve testifying before the
Speaker 2: Senate Banking Committee and House Financial Services Committee, undoubtedly going
Speaker 2: to face questions about this. I guess it would be
Speaker 2: kind of easy for him to punt and say, the
Speaker 2: policy is unclear, so I cannot tell you how it's
Speaker 2: going to dictate our monetary policy decisions at this point.
Speaker 6: Yeah, he, I mean, he obviously can legitimately, to some extense,
Speaker 6: say hang on until early days here. But you know,
Speaker 6: as I was just saying about the Chana harffs, some
Speaker 6: of this stuff is now actually happening. It's not just
Speaker 6: all threatned negotiation gets called off. The Chana tariffs are
Speaker 6: on both ways US and China goods, Chana and US goods.
Speaker 6: That's happening. The deportations are happening, The fiscal spending and
Speaker 6: the federal staff cuts are happening. So the Fed charm
Speaker 6: will have to start giving a nod that this is
Speaker 6: now happening and here's how we're thinking about it. Yes,
Speaker 6: he can say for sure how it's going to impact
Speaker 6: the economy, but I don't think he can just say
Speaker 6: early days, let's wait and see what the policies are.
Speaker 2: All right, and the current covering the economy and tariffs
Speaker 2: for US here at Bloomberg. Obviously, much still uncertain as
Speaker 2: far as this goes. And again, Donald Trump is expected
Speaker 2: to be signing executive orders in the Oval Office. It
Speaker 2: was scheduled to begin about eight minutes ago. Hasn't yet,
Speaker 2: but I would imagine we're going to get some news
Speaker 2: on this front.
Speaker 5: Yeah, well, Dip Bartow's into that event. Of course.
Speaker 4: Donald Trump has been kind of talking to the press
Speaker 4: pool in a way that presidents haven't in the past.
Speaker 4: Usually this collection of reporters, one representing each platform or
Speaker 4: each medium, will kind of stand in the corner of
Speaker 4: the room. Maybe they shout a couple of questions. Usually
Speaker 4: they're whisked out. He's turned into full blown conversations that
Speaker 4: takes some time.
Speaker 2: Yeah, they go on for quite a while, sometimes thirty
Speaker 2: minutes or more, answering a wide range of questions. And
Speaker 2: I would imagine he's going to get some today as well.
Speaker 2: On DOGE, the Department of Government Efficiency and Efforts underway
Speaker 2: two unwined portions of the US government. It started with USAID,
Speaker 2: it has now moved to the CFPB, and someone who's
Speaker 2: very familiar with that particular agency is joining US now.
Speaker 2: Mulvaney here with us on Bloomberg TV and Radio. Former
Speaker 2: acting White House Chief of Staff, former OMB director of course,
Speaker 2: former Republican Congressman from South Carolina Mick. During your tenure
Speaker 2: in the first administration, CFPB came under your charge. Now
Speaker 2: that RUSS vote has essentially said to tell the agency
Speaker 2: to stop work at least for this week, no one's
Speaker 2: getting access to the building. It does seem that this
Speaker 2: is intended to be a kind of full freeze on
Speaker 2: the operations of this regulator. How are you watching this
Speaker 2: go down.
Speaker 7: With a great deal of joy? Is that the right
Speaker 7: answer to that question. Look, I also understand that he
Speaker 7: either today or is preparing today to request zero dollars
Speaker 7: for the funding of the Bureau in the upcoming quarter,
Speaker 7: the same thing that we did when we first got there.
Speaker 7: By the way, he's able to do that because he
Speaker 7: found out there was a seven hundred million dollars slush
Speaker 7: fund in the accounts that was only one hundred and
Speaker 7: seventy million when I was there, So clearly rohich Chopra
Speaker 7: had been running up the draw down in anticipation of
Speaker 7: not getting any more money. So anyway, no, it's very aggressive.
Speaker 7: I love it. We thought we could do this. In
Speaker 7: the first we floated this to the White House lawyers.
Speaker 7: They said that there were other priorities at the time,
Speaker 7: so we didn't try this. I'm glad to see they're
Speaker 7: they're actually giving it a shot.
Speaker 5: So Mike us great to have you back.
Speaker 4: There are going to be people listening to this conversation
Speaker 4: and watching this on Bloomberg TV, listening on the radio
Speaker 4: who don't have the experience with this agency that you have.
Speaker 4: The idea of consumer advocates in government, I'm assuming, by principle,
Speaker 4: are not your issue. What is it about the way
Speaker 4: this agency was constructed and operated that makes it so
Speaker 4: toxic to you?
Speaker 7: Look, if I want to give Elizabeth Warren credit for anything,
Speaker 7: I thought the idea, the premise, at least the stated premise,
Speaker 7: was a good one, which is to take all of
Speaker 7: the consumer protection elements out of the other financial regulators
Speaker 7: and consolidate them in one place, so it's a one
Speaker 7: stop shop for consumer protection. We didn't do that. What
Speaker 7: we did instead is just simply layer another level of
Speaker 7: regulation on top of the stuff that was already there
Speaker 7: and became duplicative in many ways. Then, in large part
Speaker 7: because of the way this entity is funded. This entity
Speaker 7: is funded directly from the Federal Reserve, not from Congress.
Speaker 7: It sort of felt like it didn't answer to Congress
Speaker 7: and they were able to do whatever the leadership wanted,
Speaker 7: and during progressive leadership, they did things that I believed
Speaker 7: were against the law. I'll give you a specific example.
Speaker 7: Dodd Frank, which creates CFPB, specifically says that CFPB has
Speaker 7: no jurisdiction over automotive dealerships. But under Richard Cordrat they
Speaker 7: went after The bureau went after automobile dealerships anyway, despite
Speaker 7: the law. There's lots of examples like that. So I
Speaker 7: think it was a renegade agency. I think that they're
Speaker 7: having the right discussion down and sort of say, look,
Speaker 7: let's shut the doors, figure out what's going on. They're
Speaker 7: still paying everybody, they can't fire anybody, to stry to
Speaker 7: see if they're actually serving their statutory purpose.
Speaker 2: Well, make you made an important point there about the
Speaker 2: funding structure. That this is funded through the Federal Reserve.
Speaker 2: It's not money appropriated by Congress, even if the agency
Speaker 2: itself was authorized via an Act of Congress. So is
Speaker 2: there a distinction you draw here between these efforts at
Speaker 2: the CFPB and what's going on, for example, at USAID,
Speaker 2: which is run into problems in courts because that is
Speaker 2: congressionally appropriated money that they're trying not to spend.
Speaker 7: It's a great point, Kayleye. And what I tell people
Speaker 7: is that you know this. When Liz Warren created this
Speaker 7: agency when she was a Harvard professor, she druamed up
Speaker 7: the idea. She wanted something in her mind that was
Speaker 7: above politics. Consumer protection in her mind, was too important
Speaker 7: to trust to elected officials, and you had to have
Speaker 7: this dedicated funding source so that the funding couldn't get
Speaker 7: turned on or off depending upon who was in Congress.
Speaker 7: She did that. The double edged sword of that is
Speaker 7: that when ro Hitchopra's running the place and Congress wants
Speaker 7: to shut them down, he can sort of go and
Speaker 7: get his money without having to worry about what Congress thinks.
Speaker 7: But the other side of the sword is if Russ
Speaker 7: Vote is running the place and he doesn't want to
Speaker 7: draw any money down from the Fed, he doesn't have to.
Speaker 7: So even if Congress wants him to spend money, he's
Speaker 7: really a benevolent dictator on his own over the CFPB.
Speaker 7: And so you're seeing the other side of this equation
Speaker 7: when he says, look, I'm not drawing any money, I'm
Speaker 7: not going to spend any you know, what's your next
Speaker 7: move in the court system?
Speaker 4: Funding, of course, is one thing make if you wanted
Speaker 4: to eliminate the agency, would you need congressional approval for that?
Speaker 4: And will Donald Trump essentially just zero out, as you said,
Speaker 4: the budget and let it sit there and whether or
Speaker 4: does it does it need to be closed with the
Speaker 4: authority of Congress.
Speaker 7: This this is this is this is a this is
Speaker 7: a this is what we struggled with. I did not
Speaker 7: believe that as the director, I had the right to
Speaker 7: shutter the place. I thought the President probably had the
Speaker 7: right to tell me to shut the place. My guess
Speaker 7: is that's what's that's what they're doing this time. If
Speaker 7: you really wanted to, you know, uh, acts the thing
Speaker 7: entirely to make it cease to be that would take
Speaker 7: an Act of Congress. But I think it's up to
Speaker 7: the President and the director again as this quasi benevolent dictator,
Speaker 7: to determine the scope of what the agency the Bureau does,
Speaker 7: and that could be a really really really broad scrope
Speaker 7: spope like under Richard Cordray or Hitchopra or very very
Speaker 7: narrow under myself, Kathy Craninger and now russbot.
Speaker 2: Well, I do wonder where this would come down on
Speaker 2: the congressional priorities list, Mick, considering the legislative priorities of
Speaker 2: the president, tax policy, energy and border policy, trying to
Speaker 2: get it all through the budget reconciliation process doesn't seem
Speaker 2: like it's making much progress forward, at least in the House.
Speaker 2: Mike Johnson had suggested we could see a budget mark
Speaker 2: up this week. Now he's suggesting maybe it won't be
Speaker 2: on that timeline. Lindsey Graham is trying to move first
Speaker 2: in the Senate. How do you ultimately see this going down?
Speaker 2: Is it going to be two bills instead of one?
Speaker 7: Yeah, it's going to be whatever it takes to pass.
Speaker 7: And I think this focus on one bill versus two bills.
Speaker 7: Of course, I think President Trump had it right. He
Speaker 7: came out and said he wanted one big, beautiful bill
Speaker 7: and then the next day said I don't really care
Speaker 7: as long as it passes.
Speaker 2: And I think that's what well, But I guess the
Speaker 2: question then, Mick, is can two bills pass this House
Speaker 2: of Representatives?
Speaker 7: The better questions can one pass? So I mean, take
Speaker 7: the simplest way it's gonna work. You know this, You've
Speaker 7: been around long enough to do it. You're gonna you're gonna
Speaker 7: have five or six ideas. You're gonna have taxes, you're
Speaker 7: gonna have immigration, you're gonna have deregulation, a bunch of stuff,
Speaker 7: and you're gonna sort of throw them together and say, Okay,
Speaker 7: if we add one more thing, do we gain net
Speaker 7: votes or do we lose net votes? And they're gonna
Speaker 7: keep adding and subtracting different big pieces of the puzzle
Speaker 7: until they figure out a way to get a majority
Speaker 7: plus one in the in the state, in the House.
Speaker 7: That's the way this is gonna shake out. Honestly, it's
Speaker 7: gonna be hard to pass anything, it really really is.
Speaker 7: There's gonna be there's deep divisions with the Republican Party
Speaker 7: about how much money they want to save other folks
Speaker 7: just want to spend it, and what the priorities are
Speaker 7: between immigration, taxes, et cetera. It's going to be very,
Speaker 7: very difficult. With the margin of what are they down
Speaker 7: to this week? I think two, maybe one, depending on
Speaker 7: who got confirmed in the last forty eight hours, it's
Speaker 7: gonna be hard to pass anything. That's why I say
Speaker 7: look to the Senate, because I think they're probably start
Speaker 7: driving this discussion on that side of the building.
Speaker 4: Wouldn't be the first time that happened, Mick, and it's
Speaker 4: not the first time that we're hearing threats of a
Speaker 4: government shut down. I've only got a minute left here,
Speaker 4: but both senators from New Jersey went on Sunday morning
Speaker 4: television to threaten a government shutdown. We're going to run
Speaker 4: out of money on March fourteenth in protest of what
Speaker 4: the Doge is doing and what the administration is doing
Speaker 4: to gut, in their words, federal agencies. Is this finally
Speaker 4: it we shut down in March?
Speaker 7: You know, you forget that. I was the one who
Speaker 7: tried to coin the term shoeer shutdown back a couple
Speaker 7: of years ago. It didn't stick at the time. But
Speaker 7: if they want to try and do this, that's fine. Look,
Speaker 7: if the Democrats want to go to the mat because
Speaker 7: of doughe we welcome that as Republicans. Even if Elon
Speaker 7: Musk is not popular individually, the stuff he's turning up
Speaker 7: is solid gold material for us for midterm elections. For
Speaker 7: presidential elections. People don't like what they're learning about how
Speaker 7: their money is being spent at USAID, and I don't
Speaker 7: care if they you're progressive or conservative for the most part.
Speaker 7: So yeah, let's have that discussion. If the Democrats want
Speaker 7: to want to go to the mat on this one,
Speaker 7: I think the Republicans would welcome it from home.
Speaker 5: I think that was a bring it up.
Speaker 4: Yeah, sounded like Reilly make It's good to see if
Speaker 4: Mick Mulvaney back with US former acting White House Chief
Speaker 4: of Staff, longest business card in Washington. I'm Joe Matthew
Speaker 4: alongside Kaylee Lines. This is Bloomberg.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 2: The nation's capital, the seat of all three branches of
Speaker 2: the US government, the executive, legislative, and judicial. Sometimes they
Speaker 2: work together, other times they check and balance each other
Speaker 2: as designed by the Constitution. And certainly we've seen the
Speaker 2: judicial branch specifically acting on a check so far of
Speaker 2: this administration in many ways. Judges blocking Donald Trump's executive
Speaker 2: order ending birthrates citizenship, blocking this weekend, doge access to
Speaker 2: the Treasury payment system, blocking efforts to put thousands of
Speaker 2: employees at USAID on leave. And none of that seems
Speaker 2: to be sitting too well with the Vice President of
Speaker 2: the United States, who we should note is a Yale
Speaker 2: educated attorney. He said on x this weekend. If a
Speaker 2: judge tried to tell a general how to conduct a
Speaker 2: military operation, that would be illegal. If a judge tried
Speaker 2: to command the attorney general and how to use her
Speaker 2: discretion as a prosecutor, that's also illegal. Judges aren't allowed
Speaker 2: to control the executive's legitimate power.
Speaker 4: It's like a dystopian schoolhouse rock you just put together
Speaker 4: there here in the seat of power. Yeah, District Judge
Speaker 4: Paul Engelmeyer, New York, an Obama appointee, this is really
Speaker 4: playing back like eight years ago, right, eighteen nineteen. In fact,
Speaker 4: democratic state attorneys general start this up. Then you have
Speaker 4: the ruling from the judge who says there's some merit
Speaker 4: to the state's arguments that the administration has crossed legal
Speaker 4: boundaries here and goes back to giving access to sensitive
Speaker 4: Treasury data to the Doge. You've got people walking around
Speaker 4: inside this agency wearing T shirts and jackets that look
Speaker 4: exactly like Elon Musk. There's something to behold here, and
Speaker 4: this like a dress code at the Doge. It's a
Speaker 4: whole different story that we're talking about, and our panel
Speaker 4: surely has thoughts on this as we wait to hear
Speaker 4: from Donald Trump in the Oval Office. Genie Shanzano is
Speaker 4: with us our Democratic analyst and political science professor at
Speaker 4: Iona University, Ashley Davis, Republican strategist, and I want to
Speaker 4: get this right now. S three group, where Ashley is
Speaker 4: a new partner. It's great to see both of you here. Genie,
Speaker 4: I'm not sure your thoughts on this because it doesn't
Speaker 4: seem to be Congress on the front lines of fighting
Speaker 4: this battle. Will this all be decided in the courts?
Speaker 8: You know it might.
Speaker 9: Joe, You've forgot to mention their backpacks. A lot of
Speaker 9: focus on the DOGE lads black backpacks along their attire,
Speaker 9: So we'll add that to the mix. You know, there's
Speaker 9: really three buckets that would check the executive and obviously
Speaker 9: it's the first branch, which at least as of yet
Speaker 9: hasn't stepped up, the third branch, which just really started
Speaker 9: stepping up in concert this weekend, and then also the
Speaker 9: voters themselves, and we may see that down the road,
Speaker 9: but certainly haven't seen that yet. So at this point
Speaker 9: it does look like the courts and what we're hearing
Speaker 9: jd Vance. As Kaylee said, you know this a lawyer
Speaker 9: by training with the best education. He's mimicking something that
Speaker 9: Andrew Jackson said back in the eighteen thirties. You know,
Speaker 9: John Marshall, you want to make your decision, now you
Speaker 9: can enforce it. And of course that's what we've known
Speaker 9: since the founding, is that the Court has zero ability
Speaker 9: to enforce its ruling. It depends on the executive to
Speaker 9: do that. And so this sets up a constitutional clash.
Speaker 9: We've seen it before, and it sounds like rhetorically, it's
Speaker 9: something they may be banking on seeing again out of
Speaker 9: the executive branch.
Speaker 2: Yeah, it's an excellent point, Ashley. It is the president
Speaker 2: who is the enforcer of laws. The executive branch. It
Speaker 2: is the judicial branch that is the interpreter of law
Speaker 2: and whether law is consistent with the US Constitution. So
Speaker 2: when jd. Vance says judges aren't allowed to control the
Speaker 2: executive's legitimate power, isn't it up to them to determine
Speaker 2: what legitimate power the executive actually has?
Speaker 10: Yes, And I think that you're going to see a
Speaker 10: lot of different legal cases on this. And also, just
Speaker 10: as we were talking earlier, this is one of the
Speaker 10: only mechanisms that the Democrats have, especially with their Democrat
Speaker 10: appointed judges or elected judges for some that to kind
Speaker 10: of stop this train that is like going down the
Speaker 10: tracks as fast as it can. I think that one
Speaker 10: of the main things that everyone needs to remember is
Speaker 10: that I don't know if the Trump administration cares, if
Speaker 10: the courts continued to do this. They're going to move
Speaker 10: as fast as they can, put things in place as
Speaker 10: much as they can, and just let it bride out
Speaker 10: in the courts, and it's going to take years and
Speaker 10: years and years. By all this time and all this
Speaker 10: stuff is appealed, So I just don't know. I think again,
Speaker 10: if I was a Democrat, I would be using this
Speaker 10: one hundred percent. I just don't know how impactful it's
Speaker 10: going to be. Besides some of these delays We're.
Speaker 4: Just talking about this with Nick Mulvaney, Genie. Some Democrats
Speaker 4: are preparing to act, and look no further than the
Speaker 4: two senators from New Jersey, Corey Booker and Andy Kim
Speaker 4: split up and went on different Sunday morning shows to
Speaker 4: threaten a government shutdown to protest Donald Trump's gutting of
Speaker 4: federal agencies. Mick Mulvaney, when we pose this idea to him,
Speaker 4: basically said, make my day. Donald Trump is finding solid gold.
Speaker 4: Are the words that he used in making the case
Speaker 4: line by line as to why an agency like USAID
Speaker 4: should be defunded or at least thought. Is that smart
Speaker 4: politics to hold up a government funding bill over this?
Speaker 10: Yeah?
Speaker 9: I mean part of the problem here you nailed at, Joe,
Speaker 9: is that the Democrats are all over the map. You've
Speaker 9: got some who are really standing up. I think of
Speaker 9: the senator from Connecticut, you know, hair on fire. We've
Speaker 9: got to do everything we can to stop this. And
Speaker 9: you've got more raquel centrends, say Jakim Jeffries having to
Speaker 9: lead the group in the House. So they Democrats have
Speaker 9: to get it together on this. You know something I
Speaker 9: say all the time is yes, you can use the
Speaker 9: courts to try to stop political movement forward. But it
Speaker 9: is a political disaster. We saw that in the twenty
Speaker 9: twenty four election. Democrats, to the point that was just made,
Speaker 9: have a habit of doing this. It is not advised.
Speaker 9: If you want to win politically in this country, you
Speaker 9: have to appeal to the hearts and minds of the
Speaker 9: American voters, not unelected judges in courts. So the first
Speaker 9: piece of advice, and the second is holding up the
Speaker 9: government and shutting it down. That should be on the
Speaker 9: Republicans because they are in control. But Democrats have got
Speaker 9: to get it together and not let the mcmontaneys of
Speaker 9: the world. Quite frankly, he's very good at this saying
Speaker 9: that it's a Schumer shutdown, because again, politically, that's a
Speaker 9: loser for them. So Democrats have a lot of work
Speaker 9: to do on this score. But there are a lot
Speaker 9: of solid arguments for them to make on this and
Speaker 9: they just have to get together and make those. And
Speaker 9: what we saw the other weekend, quite frankly at the
Speaker 9: DNC meeting them talking about transgender issues, all these things.
Speaker 9: They are far afield from where they need to be
Speaker 9: talking to the American public. So they have some work
Speaker 9: to do on this front.
Speaker 2: Well, on the notion of a Schumer shutdown or a
Speaker 2: Democratic shutdown, Ashley that that is the party that would
Speaker 2: get the blame. How does that work when Republicans are
Speaker 2: the ones who are in control of both the White
Speaker 2: House and Congress. Would they not shoulder any of the
Speaker 2: blame if this happens in mid March?
Speaker 10: Yeah, I mean you would think. I would think so.
Speaker 10: I actually was having this conversation over the weekend, and
Speaker 10: how how do the Republicans and Democrats kind of win
Speaker 10: the pr message? Which is a horrible thing to say
Speaker 10: if we all think about it, if this is how
Speaker 10: we're running our country. But I because Republicans are in
Speaker 10: control of all three ranches, this should be one hundred
Speaker 10: percent down around their neck in regards to responsibility. However,
Speaker 10: if the Democrats don't at least look like they're coming
Speaker 10: to the table to negotiate, and then they just can't
Speaker 10: agree to the government funding numbers based on difference in policies,
Speaker 10: then it's really hard.
Speaker 7: For Republicans to blame it on them.
Speaker 10: If they sit back and just say, you know what,
Speaker 10: I'm mad because USAID funding is going away or whatever.
Speaker 10: That's not going to work. And you know, Trump's a
Speaker 10: brilliant messenger, and he'll start trying to make this all
Speaker 10: their faults. So I do think they're going to have
Speaker 10: to split that balance of negotiation, at least looking like
Speaker 10: they are.
Speaker 4: Senator Andy Kim on NBC Genie, I would be the
Speaker 4: last person to want to get to that stage referring
Speaker 4: to a shutdown, But we're at a point where we're
Speaker 4: basically on the cusp of a constitutional crisis. Is that
Speaker 4: how you look at this and is that the way
Speaker 4: Democrats should be framing it?
Speaker 9: You know, that is what they're hearing from their base.
Speaker 9: I mean what we're hearing. The calls coming into these
Speaker 9: offices are coming fast and furious, and you know, we
Speaker 9: are only three weeks in. But wait until people start
Speaker 9: to feel on the ground the impact of these kinds
Speaker 9: of actions by the executive branch, and even Republicans in
Speaker 9: the House and Senate are going to feel it. You know,
Speaker 9: we had a Christy Gnome on Sunday saying she would
Speaker 9: advise the President to shut down FEMA is the way
Speaker 9: it exists now that impacts people on the ground. It's
Speaker 9: going to take a while, but it impacts people on
Speaker 9: the ground, and you can bet their senators and representatives
Speaker 9: will hear that.
Speaker 3: Well.
Speaker 9: The Andy Kims of the world, the Chris Murphys of
Speaker 9: the world, they are already hearing from their constituents. And
Speaker 9: that's why they are talking in this way. And it's
Speaker 9: not just voters. You know. If we go back to
Speaker 9: the CFPB Elon Musk has talked about wanting a payments
Speaker 9: and commerce platform. What about the other companies that he
Speaker 9: now has an advantage over because he presumably has got
Speaker 9: proprietary information about those companies now having been in there
Speaker 9: all weekend before the judge shut that down. There are
Speaker 9: also going to be companies that say, hey, wait a minute,
Speaker 9: the executive has gone too far, and that is what
Speaker 9: is going to turn this around. I'm not sure that
Speaker 9: it works for Democrats to keep crying, you know, crisis, crisis, crisis,
Speaker 9: but they do have to talk to people about what
Speaker 9: they're feeling on the ground, and there will be real
Speaker 9: impacts to all this action eventually.
Speaker 2: Is this something that is going to be felt beyond
Speaker 2: the beltwagh Ashley, or at least outside of the bubble
Speaker 2: here in Washington. I do wonder it's hard to see
Speaker 2: outside the bubble sometimes if this is actually very insular
Speaker 2: conversation that most of America may not be paying that
Speaker 2: much attention to.
Speaker 10: Frankly, I completely agree with you. I mean, I wonder
Speaker 10: how many people in North Dakota even understand what USAIDA
Speaker 10: is or doges or whatever I mean, or paying attention
Speaker 10: to it, because what they are worried about is the
Speaker 10: price of their eggs, or the price of their rent
Speaker 10: or everyday expenses. And so this question was asked yesterday
Speaker 10: to the President as well, is where are we on that? So, yes,
Speaker 10: he is doing things fast and furious and things that
Speaker 10: he said he would do on the campaign trail that
Speaker 10: you know, isn't that surprising. I think the speed that
Speaker 10: he's doing it is what's maybe surprising people. However, I
Speaker 10: think that if I were the Democrats, I would be
Speaker 10: concentrating on the price of some of these groceries and
Speaker 10: things like that. Instead of saying this guy has fallen
Speaker 10: as these words, I'm saying this like this guy is
Speaker 10: falling on every single topic.
Speaker 2: So maybe just more about egg prisis Ashley Davis s
Speaker 2: and Genie Shanzano our political panel on this Monday. Thank
Speaker 2: you so much for joining us. We'll have more Balance
Speaker 2: of Power straight ahead here on Bloomberg TV and radio.
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 4: As we stand by for news at the White House,
Speaker 4: President Trump is expected to be signing some executive orders
Speaker 4: that had been scheduled well for forty two minutes ago.
Speaker 5: He still has not emerged.
Speaker 4: The press pool is standing by from what we understand,
Speaker 4: and this is important because we're anticipating some news on
Speaker 4: tariffs twenty five percent tariffs as you've been hearing today
Speaker 4: and seeing on Blue Umberg against steel and aluminum imports.
Speaker 4: There are huge questions, Kayley, about whether there will be
Speaker 4: some countries exempted from this, like say Canada, whether China
Speaker 4: will in fact be double tariff. All that will presumably
Speaker 4: be made clear a little bit later on. He tends
Speaker 4: to have kind of the rolling news conference while he's
Speaker 4: signing with the Sharpie.
Speaker 2: Well, and he indicated this may not be the only
Speaker 2: tariff related announcement he makes this week. Is reciprocal tariffs,
Speaker 2: that's right, maybe announced Tuesday or Wednesday, he told reporters
Speaker 2: aboard Air Force One last night. And it's unclear how
Speaker 2: wide and scope those will be either. We have a
Speaker 2: lot of outstanding questions regarding tariff policy that we do know,
Speaker 2: of course, that ten percent tariffs on Chinese goods are
Speaker 2: already in place in the retaliatory measures from China on
Speaker 2: US imports to that country have kicked in as well.
Speaker 2: So we want to discuss the net effect of all
Speaker 2: of this and go now live to Capitol Hill, where
Speaker 2: Democratic Congressman Haley Stevens of Michigan is joining us back
Speaker 2: with us on balance of Power. Welcome back to Bloomberg
Speaker 2: TV and Radio. Congresswoman, when you consider your district in
Speaker 2: Michigan and not just the tariffs that are in place,
Speaker 2: but the threat of tariffs going into place and potentially
Speaker 2: affecting costs that your constituents are facing, what are you
Speaker 2: hearing about this, What impact are you bracing for?
Speaker 11: Well, I think it's very important to bring the American
Speaker 11: worker to the table on these decisions, and we all
Speaker 11: know that select tariffs can be utilized for the strength
Speaker 11: of the American economy, to bolster the pocketbook of the
Speaker 11: American worker and to strengthen our supply chain. And we've
Speaker 11: seen previous administrations used tariffs. What we've lived through in
Speaker 11: the last couple of weeks, though, has been without the
Speaker 11: buy in, and certainly those of us on Capitol Hill,
Speaker 11: we're just waiting to hear if we have a White
Speaker 11: House liaison over there at sixteen hundred Pennsylvania Avenue. I
Speaker 11: had some constituents from Michigan in town last week and
Speaker 11: we went to go log on to the White House
Speaker 11: and see if we could get them a tour. And
Speaker 11: they don't even have the portal open for members of
Speaker 11: Congress to give our constituents tours of the White House.
Speaker 11: So in terms of what they're going to put forward
Speaker 11: with all these executive orders and how we're going to
Speaker 11: work together, we want to be at the table for
Speaker 11: our constituents. We're certainly taking a lot of cues from
Speaker 11: those who've been in the trenches, like the United Auto Workers,
Speaker 11: certainly the United steel Workers and the like. And we
Speaker 11: know that other rounds of tariffs got worked out, but
Speaker 11: our supply chain, and particularly our automotive sector, it's complex.
Speaker 11: They need certainty and they don't need this pendulum swinging
Speaker 11: from one minute, we're going to see twenty five percent
Speaker 11: tariffs on Canada and Mexico. Oops, that get scaled back
Speaker 11: or whatever. We got out of that, and then you
Speaker 11: see what's going on with China. Maybe that does have
Speaker 11: some outcome for us, but we just need to know,
Speaker 11: we need to know, and we need some time to
Speaker 11: work this all out, and we're waiting on the administration
Speaker 11: to do that for us as well.
Speaker 5: Well. Congress Swiman, welcome back.
Speaker 4: I want to bring it back to your time as
Speaker 4: an employee of the Treasury Department. You were chief of
Speaker 4: staff on the Auto Task Force, which we talk about
Speaker 4: a lot responsible for returning the auto industry to stability
Speaker 4: and preserving auto jobs back in the Obama administration.
Speaker 5: You know what it's like to be in that building,
Speaker 5: and you.
Speaker 4: Also know what it's like, as you said, to go
Speaker 4: through this complex series of stages to build a car
Speaker 4: in a place like Michigan, crossing the border back and
Speaker 4: forth between Michigan and Canada multiple times at various stages
Speaker 4: of assembly. That's not going to live through a twenty
Speaker 4: five percent tariff if that ends up being the case.
Speaker 4: Donald Trump's got I realized a couple of months left
Speaker 4: to figure that out. When you talk about Canadian and
Speaker 4: Mexican tariffs to car companies, now while they have the chance,
Speaker 4: need to start rethinking the way they produce these vehicles.
Speaker 11: Well, I really appreciate you bringing up my time at
Speaker 11: the Treasury Department during President Obama's first term, because it
Speaker 11: was such a special time. It was a tough time.
Speaker 11: It was a very challenging time, but what made it
Speaker 11: special is that people came together for the betterment of
Speaker 11: our nation and our economy. The Bush administration officials, they
Speaker 11: stayed on a lot of them at the Treasury Department,
Speaker 11: they worked with those of us in the Obama administration.
Speaker 11: We set up a nonpartisan team to rescue General Motors
Speaker 11: and Chrysler and two hundred thousand Michigan jobs. And certainly
Speaker 11: we weren't putting an Elon Musk in charge of the
Speaker 11: wires to spook everyone that he has access to your data.
Speaker 11: Which is also why last week, alongside our House Democratic
Speaker 11: Leader Haikeen Jeffries, I introduced the Taxpayer Data Protection Act. Now,
Speaker 11: you asked a very important question about what do our
Speaker 11: automakers need and certainly their views and their declarations has
Speaker 11: proven original equipment manufacturer are going to matter a whole
Speaker 11: heck of a lot here. But I also know they
Speaker 11: don't want to pick a big fight with the administration
Speaker 11: out of the get, which is why I'm taking my
Speaker 11: expertise as a member of Congress, as a representative from
Speaker 11: Oakland County, Michigan, where we've got automation Alley and a
Speaker 11: lot of suppliers and stillanis headquartered, and certainly you know
Speaker 11: that strong affiliation with Ford and General Motors. And we're saying,
Speaker 11: wait a minute, guys, give us a minute here. We've
Speaker 11: got this USMCA framework. Why don't we use that. We're
Speaker 11: going into a review period. We're going to race against
Speaker 11: China with these rare earth minerals. I'm working on legislation
Speaker 11: for that too. Maybe we could do something along the
Speaker 11: industrial policy lines like we did with the Chips and
Speaker 11: Science Act, which by the way, has worked for the
Speaker 11: American taxpayer, has worked for the manufacturing economy, and so
Speaker 11: those might be some other things that we could consider
Speaker 11: together both branches of government, as our founders intended.
Speaker 2: Well at Congressman, I'm glad you raised the legislation that
Speaker 2: you introduced last week to rein in the ability of
Speaker 2: Elon Muskin those working for the dogs to access taxpayer information.
Speaker 2: I do wonder, though, if you really think there is
Speaker 2: appetite for that in your chamber, specifically if you're expecting
Speaker 2: Republican buy into this, or if ultimately it's going to
Speaker 2: be left up to the courts after a judge over
Speaker 2: the weekend, did indeed at least temporarily block access to
Speaker 2: these systems.
Speaker 11: Well, certainly as someone who's not afraid to work in
Speaker 11: a bipartisan way, I'm not here to play gimmicks. And
Speaker 11: I'd say to my fellow House members on the other
Speaker 11: side of the Okaylee, Hey, come on over right. I mean,
Speaker 11: think about the authority that we're seeding to the Executive
Speaker 11: Office when we also need to insert ourselves. And part
Speaker 11: of how we've gotten into these challenges with our debt
Speaker 11: and our deficit is that we also need to do
Speaker 11: a better job of doing our job as members of Congress.
Speaker 11: And that means taking hold of our authority. That means
Speaker 11: utilizing the led powers before us, and it's not necessarily
Speaker 11: to I mean, I'm looking at it as I'm a
Speaker 11: citizen and an elected official who's concerned about what Elon
Speaker 11: Musk is doing at the Treasury Department. A little bit
Speaker 11: of transparency here would go a long way. And I
Speaker 11: understand the presidents doing his press conferences and he is
Speaker 11: answering questions, but we really haven't gotten an answer as
Speaker 11: to what the heck they're doing in the Bureau of
Speaker 11: Fiscal Service, which I never had access to as a
Speaker 11: White House appointee in a schedule see role. Why does
Speaker 11: Elon Musk, who doesn't even have a top security clearance
Speaker 11: and these conflicts of interest? And I just say that
Speaker 11: with all due respect, you have to understand elected officials,
Speaker 11: executive branch, legislative branch. We hold the public trust. Let's
Speaker 11: continue to build it. And that's also what we're seeing
Speaker 11: that the legislation can do. I'm here, I love our country.
Speaker 11: I want to work with our country. I want to
Speaker 11: deliver for the taxpayer. I want to deliver for our
Speaker 11: economy and with that, hardworking Americans and those who've retired
Speaker 11: and those who are trying to raise their kids.
Speaker 4: Right now, well, let's get to it here, congresswoman, because
Speaker 4: when you introduced that legislation, you wrote in your statement.
Speaker 4: It begs the question, what exactly is he referring to
Speaker 4: Elon Musk? What is he trying to accomplish research on
Speaker 4: his opponents? You asked stopping payments on Americans earned benefits
Speaker 4: like Social Security and Medicare? Is there something that you
Speaker 4: know about here, Congresswoman, that would indicate any of these
Speaker 4: are happening.
Speaker 11: We don't know those answers, And I will tell you
Speaker 11: it's just what I'm hearing from concerned citizens, Joe. It
Speaker 11: really is the level of nerves that I have gotten
Speaker 11: from people back home in Oakland County, Michigan. It is
Speaker 11: really palpable. And I say that because I'm just trying
Speaker 11: to do my darnness as a representative and a purveyor
Speaker 11: of the truth and as somebody who's got the power
Speaker 11: of the pen to write these bills that we need
Speaker 11: those answers. That's all that that is going to do here.
Speaker 11: This is a new thing for us, And look, we
Speaker 11: do need people digging into our government and helping us
Speaker 11: figure out how to get the best bills done and
Speaker 11: how to trim some of the fat and to make
Speaker 11: us more efficient. Gosh, that came up when I was
Speaker 11: working for President Obama over a decade ago, we really
Speaker 11: went through a whole exercise on that, particularly for small businesses,
Speaker 11: and how challenging it is for them to work for
Speaker 11: the work with the federal government on occasion, and so
Speaker 11: we really just want to build that trust and we
Speaker 11: want to get those questions answered. And that's what I
Speaker 11: think my bill would do taxpayer data protection, all sides
Speaker 11: of the I are welcome to join in and sign
Speaker 11: on to it. We really love to have you.
Speaker 2: Well, Congressman, if we're talking about trust in the federal government,
Speaker 2: what about trust and the government's ability to make sure,
Speaker 2: at least through Congress, that it is continued, continually funded
Speaker 2: beyond the deadline of mid next month. We've heard from
Speaker 2: some of your Democratic colleagues a suggestion that your party
Speaker 2: is not willing to play ball with Republicans over some
Speaker 2: of the very same things we're taught talking about the
Speaker 2: efforts of doge, the operations of this administration. Are you
Speaker 2: willing to tolerate a shut down to make a point
Speaker 2: on that.
Speaker 11: Well, let me tell you this, I don't think there's
Speaker 11: anyone more frustrated in the Congress right now than the
Speaker 11: House Republicans, in part because they're finding out about these
Speaker 11: executive orders. When the American public find out, they're not
Speaker 11: necessarily being brought in to the objectives of this administration,
Speaker 11: and they're not having a lot of say in terms
Speaker 11: of what's going on here. I've made it really clear
Speaker 11: that as a member of the Minority Party in the
Speaker 11: House of Representatives, I'm going to use my vote and
Speaker 11: my voice accordingly, and I'm going to do so alongside
Speaker 11: this steady and incredible leadership that we have here in
Speaker 11: the House of Representatives from Hakeem Jeffreys. That's absolutely essential.
Speaker 11: There's a lot of things that we have worked really
Speaker 11: hard for over a number of years that frankly have
Speaker 11: a lot of support around this country. I'm thinking about
Speaker 11: these new manufacturing facilities that are opening up in the
Speaker 11: clean tech space, that big competition we're in with the
Speaker 11: Chinese Communist Party.
Speaker 9: Jd.
Speaker 11: Vance came to Michigan and said one of those plants
Speaker 11: was table scraps. He's now our vice president. I can't
Speaker 11: look all those people, the hundreds of people just working
Speaker 11: on rehabbing that plant. I can't look them in the
Speaker 11: face and say that's okay. So if we're going into
Speaker 11: a budget where you're going to slash that I'm not
Speaker 11: signed up here. Let's negotiate.
Speaker 4: Could you look them in the face, though, Congresswoman, to
Speaker 4: get to Kyley's question and tell them that it's worth
Speaker 4: shutting down the government to make a statement here when
Speaker 4: it comes to the actions of this administration, for instance,
Speaker 4: getting inside the Treasury, Department, USAID and others.
Speaker 11: Well, I certainly reject the notion that the Democrats would
Speaker 11: be responsible for a shutdown. I want to be really
Speaker 11: clear on that. We're really proud that under the four
Speaker 11: years of President Biden's leadership that we never shut down
Speaker 11: the government once. That's actually something that that he has
Speaker 11: under his belt. And I know he's not the president anymore,
Speaker 11: and that's going to fall to our commander in chief. Ultimately,
Speaker 11: he's the one signing the bills, and he's got the
Speaker 11: grip on the Congress with the party that he is in,
Speaker 11: and we've got a speaker, and they're saying, this is
Speaker 11: a big old mandate and if they are going to
Speaker 11: try and open up that door to working with us,
Speaker 11: we're all ears on certainly workforce initiatives which truly meet
Speaker 11: that those incredible goals of the realize potential of all Americans.
Speaker 11: The STEM bills, Science, Technology, Engineering and Mathematics that I've
Speaker 11: worked on for a number of years, from rural Americans
Speaker 11: to urban Americans, making sure that they've got that pipeline
Speaker 11: to a good paying job. Let's have that conversation. Let's
Speaker 11: fund those programs. Let's not attack the National Science Foundation,
Speaker 11: the National Institute of Health. Let's build a government we
Speaker 11: can trust together.
Speaker 4: Well, it's great to have you back, Congressman Hailey Stevens,
Speaker 4: or should I say former Treasury Department official Hailey Stevens
Speaker 4: of Michigan, And it's great to have you with us,
Speaker 4: of course, live from Capitol Hill.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 4: President Trump will be signing some executive orders. They have
Speaker 4: not been detailed on the schedule, but we do expect
Speaker 4: one of them, maybe several of them, to address steel
Speaker 4: and aluminum tariffs. Questions about whether there'll be exemptions. We're
Speaker 4: double tariffing China. What about Canada, the primary source of
Speaker 4: steel on an export level in this country. We need
Speaker 4: to find all of this out still, and there will
Speaker 4: likely be market implications here. We're kind of dancing along
Speaker 4: listening to Charlie and interesting that we haven't seen.
Speaker 5: Much action outside of the steel companies. We'll let you
Speaker 5: know what goes on there.
Speaker 4: As we turn to what I would argue is the
Speaker 4: most important story of the day. Tariff seemed to come
Speaker 4: and go around here. The penny not so much, though
Speaker 4: it may be going. That's the latest order from the
Speaker 4: President of the United States to the Treasury, which of
Speaker 4: course oversees the mint, stop making the penny, he says,
Speaker 4: calling them wasteful. You do wonder about these executive orders,
Speaker 4: the stroke of a pen or a sharpie, impacting entire
Speaker 4: industries or businesses as anyone reached out to coinstar at
Speaker 4: the grocery store. Stephen Dennis, as a matter of fact,
Speaker 4: has before this order went out. We were talking to
Speaker 4: Stephen about the veracity of the penny, the value of
Speaker 4: the penny, staying.
Speaker 5: Power of the penny.
Speaker 4: Stephen covers Congress for a living, but as an expert
Speaker 4: on the penny and he's with us right now at
Speaker 4: the table. Did I go too far with that? I
Speaker 4: feel like you're pretty close to an expert.
Speaker 8: I've found this penny issue fascinating. See for decade, for decades,
Speaker 8: we've spent more money to make a penny than the
Speaker 8: government gets back by selling them to banks, right, and
Speaker 8: so this is like such an old, you know issue.
Speaker 8: They actually made a West Wing episode about it, and
Speaker 8: people have been trying to kill it or to suspend
Speaker 8: the production of it. John McCain actually had a bill
Speaker 8: a number of years ago to well to stop.
Speaker 5: Minting them, could still use them?
Speaker 8: Yeah, you still use them. I mean there are something
Speaker 8: like two hundred billion pennies in circulation, so they're not
Speaker 8: going to go away overnight even if we stop minting them.
Speaker 8: We've been minting about three or four five billion every
Speaker 8: year and so that's imagine that potentially one hundred million
Speaker 8: dollars in less spending. But you know, in the past,
Speaker 8: Congress has not wanted to take on the penny lobby.
Speaker 8: And yeah, so there's you know, there's Pennies dot Org.
Speaker 8: There's a company in Tennessee called now called Artisan.
Speaker 5: Were you referring to Americans for common sense.
Speaker 8: Yeah, there's a various groups out there that lobby to
Speaker 8: keep the penny in it. And so you have the
Speaker 8: company that makes all the zinc blanks is in Tennessee
Speaker 8: called Artisan Okay, so they make money off of the penny.
Speaker 5: Which is not made of copper.
Speaker 8: Oh, it's still has some copper in little copper, mostly zinc.
Speaker 5: And these people have real jobs at this place.
Speaker 8: Yeah, there's still lots of people who mine the zinc
Speaker 8: and the copper, make the stuff.
Speaker 4: The trade of zoo pennies dot org. These guys are,
Speaker 4: they're not volunteers.
Speaker 8: Used to be a company called Jarden Zinc. It's been
Speaker 8: around since the eighteen hundreds making things like pennies. And
Speaker 8: so you know, there could be a fight on Trump's
Speaker 8: hands here with people who represent districts where there are
Speaker 8: penny jobs. But you know this is this has been
Speaker 8: one of those classic cases of Washington not wanting to,
Speaker 8: you know, squeeze something because you have to take on
Speaker 8: somebody who's going to be lobbing to keep their piece.
Speaker 5: Of the pie.
Speaker 4: Well, so Doge was got a head start on this, yes,
Speaker 4: and took to X saying the penny costs over three
Speaker 4: cents to make. Consider that and cost US taxpayers over
Speaker 4: one hundred and seventy nine million dollars in f y
Speaker 4: twenty twenty three penny or three cents for your thoughts,
Speaker 4: it said Donald Trump, making the point that when do
Speaker 4: you think the last time Donald Trump used a penny?
Speaker 8: I think it's unlikely. He's just a penny just you know,
Speaker 8: do you.
Speaker 5: Ever know guys who throw the pennies out?
Speaker 3: Yeah?
Speaker 8: I mean if you think, if you think about it,
Speaker 8: like minimum wage now seven to twenty five an hour,
Speaker 8: still seven twenty five an hour, you'd have to pick
Speaker 8: up been down seven hundred and twenty five times every
Speaker 8: hour just to make a minimum wage. And that explains
Speaker 8: why there are two hundred billion in circulation.
Speaker 3: You know.
Speaker 8: People throw them out, people throw them into the river,
Speaker 8: the people put them in jars in their basements. Because
Speaker 8: but he uses them. The only person I've seen using
Speaker 8: one in the last year in the US Senate. Yeah, okay,
Speaker 8: where I eat every day is Ed Markey. So he's
Speaker 8: he's brought he to the penny. He's basically sort of
Speaker 8: he's been in Congress for many decades. He's truly old school.
Speaker 8: He wants to mandate AM radio in every car.
Speaker 5: Yeah, God love them.
Speaker 8: Uh, you know, he still uses pennies and sort of
Speaker 8: wadded up dollar bills to pay for his lunch, and
Speaker 8: but everybody else uses a card, so the demand for
Speaker 8: Kenny's pennies is plummeting. Retailers tend to not like having
Speaker 8: to have cash registers waste their time sort of counting them.
Speaker 8: So the Coinstar Yeah, now, Coinstar also, their entire business
Speaker 8: model is basically based on people not wanting to count
Speaker 8: them out and finding them useless, so they'll go to
Speaker 8: Coinstar and dump in hundreds of pennies to get like
Speaker 8: a you know, a gift card or something. And you know,
Speaker 8: so I don't think Coinstar is going to be actually
Speaker 8: that hurt that.
Speaker 5: Much because people a lot of dumb pennies.
Speaker 8: People still have two hundred billion pennies to turn and
Speaker 8: now that's only two billion dollars. You know, it's just
Speaker 8: you know, when you think about the actual amount of
Speaker 8: money involved here, it's made small, yes, right, And that's
Speaker 8: the classic example in Washington where they say, you know,
Speaker 8: the juice isn't worth a squeeze. Do you actually want
Speaker 8: to squeeze it when you know you're gonna have to
Speaker 8: make some people unhappy.
Speaker 4: We're getting the best of Steven Dennis right now. I
Speaker 4: hope everyone who enjoys.
Speaker 8: Don't forget the nickel.
Speaker 5: Get the nickel.
Speaker 4: I'm about to go there because Ed Marky will be
Speaker 4: glad to know that the people at penny dot org
Speaker 4: penny or pennies pennies dot org, well, they see the
Speaker 4: nickel eating us alive if you do.
Speaker 5: Away with the penny. Now, by the way, I.
Speaker 4: Was shocked to learn today that the nickel costs thirteen
Speaker 4: point seven eight cents to make.
Speaker 5: This is way worse than the penny.
Speaker 4: And they say you take pennies away, you know what's
Speaker 4: gonna happen drive up the cost of the nickel.
Speaker 8: Well, and they also, you know people might use more.
Speaker 5: You're gonna need more nickel, right, so you know.
Speaker 8: The next step would obviously be get getting rid of
Speaker 8: the nickel. Now, nickel uses nickel, which is actually very
Speaker 8: important for things like ev batteries. Right, so you have
Speaker 8: you have Elon Musk he uses a lot of nickel,
Speaker 8: and his Tesla's correct. Right now, we're like digging nickel
Speaker 8: out of like an island mine in the South Pacific.
Speaker 8: We're surrounded by it and using some of that nickel
Speaker 8: and nichols, right, so uh yeah, the the nickel costs
Speaker 8: a lot more than we than we currently get back.
Speaker 5: From The Canada has done this right, They just round
Speaker 5: everything up.
Speaker 8: Lots lots of countries have gotten rid of it and
Speaker 8: it's no big deal.
Speaker 4: So that it would be it would be nine ninety
Speaker 4: five from now on if it had been nine ninety one,
Speaker 4: you're gonna go to you probably.
Speaker 8: You know, Congress could theoretically come in and pass a
Speaker 8: law to govern the rounding up, rounding down part of this,
Speaker 8: but in the meantime it might be just sort of
Speaker 8: like anything goes.
Speaker 4: This is a fascinating conversation in the age of blockchain.
Speaker 4: Is there an eventual goal to eliminate all the coins here,
Speaker 4: all the physical coins, so we're doing digital coins.
Speaker 8: I mean, if you think about the inflation that we've
Speaker 8: had and the inflation we're going to continue to have
Speaker 8: even if we get down to the two percent target,
Speaker 8: eventually all these coins become worthless. You know, you're gonna
Speaker 8: you know, the dyme might stick around a little longer.
Speaker 8: The quarter currently make a profit on that's not gonna
Speaker 8: last another one hundred years. So and the reality is
Speaker 8: is fewer and fewer people are using physical money. They
Speaker 8: are using their credit cards, they're using their debit cards.
Speaker 8: That trend is going to continue. And then you've got
Speaker 8: people talking about, well, we can do stable coins and
Speaker 8: you can have a stable coin card. You can go
Speaker 8: to Walmart use the Walmart stable coin card. That's already
Speaker 8: talk of, you know, doing all that sort of thing
Speaker 8: as well. Nobody's using pennies, like there are a few
Speaker 8: people who say, well, charity use it in the you know, holidays,
Speaker 8: you can go to the Salvation Army and dump your
Speaker 8: pennies into the but that's still a lot of friction,
Speaker 8: you know, to actually give somebody some money. And it's
Speaker 8: this may be the time the pennies finally go away.
Speaker 8: But it's also possible that Congress says no on Article one.
Speaker 8: Congress has the power to mint coins. Now they've given
Speaker 8: the secretary some discretion, you know, the secretary has some
Speaker 8: discretion on how many to make. So I wouldn't be
Speaker 8: surprised if the Treasury Secretary, you know, says, will mint
Speaker 8: ten thousand this year.
Speaker 4: Well, it's funny to think. You know, Congress doesn't have
Speaker 4: a lot to say about ending entire federal agencies. But
Speaker 4: you mess with the penny, you're flying a little close
Speaker 4: to the sun. Pennies are made of zinc, little copper. Yeah,
Speaker 4: is there steal in any of this stuff to the
Speaker 4: steel aluminum tariffs?
Speaker 5: No, it's the coins.
Speaker 8: But there was a proposal by Joni Ernzt, who kind
Speaker 8: of got the ball rolling here with Dough. She's the
Speaker 8: co chair of the Dough Caucus. She had a bill
Speaker 8: with the Democrats to change the composition of pennies, nickels,
Speaker 8: and other things to make them a little cheaper, not
Speaker 8: to get rid of them entirely, but to make them
Speaker 8: a little cheaper than three cents for a penny, so
Speaker 8: you could you could make them out of something cheaper.
Speaker 8: But that bill doesn't seem to be going anywhere, you know,
Speaker 8: you know, any anytime you're doing something like this, you
Speaker 8: canna have a zinc lobby, a copper lobby. You know,
Speaker 8: you're gonna have the nickel lobby. They're not gonna wanna
Speaker 8: lose their money. The unions aren't.
Speaker 4: Gonna want then lobby and the nickel lobby like they
Speaker 4: they have like chain fights in the parking lot.
Speaker 5: Is that are these guys opposed? You know, it does
Speaker 5: seem to any of them.
Speaker 8: It does seem to be every metal and every coin
Speaker 8: out for themselves.
Speaker 4: It seems like maybe they could band together for the
Speaker 4: greater good. Now, next time I find like a green
Speaker 4: gross penny in a pocket or in the couch or whatever,
Speaker 4: it's kind of corroded. Am I saving that for posterity?
Speaker 4: Or there's just so many of them that they're they're
Speaker 4: gonna be worthless.
Speaker 8: I think unless they're an old penny, that they're basically worthless.
Speaker 5: Got it?
Speaker 8: You know, there's two hundred billion out there. There's like
Speaker 8: think I think about how big that number is. That
Speaker 8: is a stupefyingly big number. It might be the most
Speaker 8: common thing out there than like dental picks, it is,
Speaker 8: and people aren't saving those either. So like this is
Speaker 8: that This is just you.
Speaker 4: Know, this is the kind of stuff you learn when
Speaker 4: you talk to Steven Dennis in the pantry in the hallway.
Speaker 4: This is the kind of man you want to have
Speaker 4: in the newsroom. Thank you for bringing your expertise to
Speaker 4: us here. Sure, I need to balance of power when
Speaker 4: it comes to the Mighty Penny. I'm Joe, Matthew and Washington.
Speaker 4: Glad you came along. You didn't think you were going
Speaker 4: to learn as much about the Penny Today. Look out
Speaker 4: for the Nickel lobby guys. They're not fooling around. The
Speaker 4: fastest show in politics, This is Bloomberd. Thanks for listening
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Speaker 4: from Washington, DC at noontime Eastern at Bloomberg dot com.