1 00:00:00,880 --> 00:00:04,360 Speaker 1: You're listening to the Bloomberg Sound On podcast. Catch us 2 00:00:04,400 --> 00:00:07,560 Speaker 1: live weekdays at one Eastern on Bloomberg dot com, the 3 00:00:07,640 --> 00:00:10,760 Speaker 1: iHeartRadio app and the Bloomberg Business App, or listen on 4 00:00:10,800 --> 00:00:12,800 Speaker 1: demand wherever you get your podcasts. 5 00:00:14,080 --> 00:00:16,360 Speaker 2: And welcome to the Friday edition of Sound On. I'm 6 00:00:16,440 --> 00:00:19,080 Speaker 2: Joe Matthew in Washington, where it's now up to the 7 00:00:19,079 --> 00:00:21,880 Speaker 2: President to sign the debt ceiling bill after the Senate 8 00:00:21,880 --> 00:00:22,880 Speaker 2: got it done last night. 9 00:00:22,960 --> 00:00:24,959 Speaker 1: On this vote, the a's are sixty three. 10 00:00:25,079 --> 00:00:28,040 Speaker 3: The a's are thirty six, the sixty vote threshold having 11 00:00:28,040 --> 00:00:30,760 Speaker 3: been achieved, the bill is passed. 12 00:00:30,800 --> 00:00:34,120 Speaker 2: Ah Yes, right around eleven o'clock last night, sixty three, 13 00:00:34,240 --> 00:00:38,199 Speaker 2: thirty six. The whole drama is over. After all the 14 00:00:38,240 --> 00:00:43,000 Speaker 2: talk of economic catastrophe, calamity, and disaster, we can tell 15 00:00:43,000 --> 00:00:45,240 Speaker 2: you the nation will not default on Monday. A cause 16 00:00:45,240 --> 00:00:48,199 Speaker 2: for celebration if your Senate majority of Leader Chuck Schumer. 17 00:00:47,880 --> 00:00:52,000 Speaker 4: Now Democrats are feeling very good tonight. We've saved the 18 00:00:52,040 --> 00:00:55,200 Speaker 4: country from the scourge of default, even though there were 19 00:00:55,280 --> 00:00:58,440 Speaker 4: some on the other side who wanted default, wanted to 20 00:00:58,520 --> 00:01:01,560 Speaker 4: lead us to default. We may be a little tired, 21 00:01:01,720 --> 00:01:02,720 Speaker 4: but we did it. 22 00:01:03,040 --> 00:01:08,080 Speaker 2: Not that everyone was happy. Seventeen Republicans voted no. Five 23 00:01:08,120 --> 00:01:12,000 Speaker 2: progressive Democrats voted against it as well, including Senator Elizabeth 24 00:01:12,000 --> 00:01:14,640 Speaker 2: Warren of Massachusetts. She spoke with a local TV station 25 00:01:14,720 --> 00:01:15,280 Speaker 2: after the vote. 26 00:01:15,319 --> 00:01:17,240 Speaker 5: We should never have been put in this position to 27 00:01:17,240 --> 00:01:20,240 Speaker 5: begin with. This is about paying the ransom to a 28 00:01:20,280 --> 00:01:23,480 Speaker 5: bunch of hostage takers, and that is not how we 29 00:01:23,520 --> 00:01:24,560 Speaker 5: should run this government. 30 00:01:24,640 --> 00:01:26,600 Speaker 2: This is where we begin with Heather Bouchet, glad to 31 00:01:26,600 --> 00:01:28,199 Speaker 2: say is back with us member of the White House 32 00:01:28,200 --> 00:01:31,400 Speaker 2: Council of Economic Advisors with the view of the White House. 33 00:01:31,840 --> 00:01:34,560 Speaker 2: Doctor Bouchet, welcome back to Bloomberg. It's great to have you. 34 00:01:34,600 --> 00:01:37,240 Speaker 2: What is your message this morning? Beyond the fact that 35 00:01:37,240 --> 00:01:39,440 Speaker 2: we're avoiding default and I realized that's a pretty big 36 00:01:39,520 --> 00:01:43,160 Speaker 2: deal here to progressive Democrats who thought that there was 37 00:01:43,200 --> 00:01:44,919 Speaker 2: something wrong in this bill enough for them. 38 00:01:44,760 --> 00:01:48,240 Speaker 6: To vote no, well, let's just start. You know, I'm 39 00:01:48,240 --> 00:01:50,880 Speaker 6: an economist. Let's just start with the economic angle. This 40 00:01:50,960 --> 00:01:54,840 Speaker 6: is certainly a win for the US economy. The catastrophic, 41 00:01:55,480 --> 00:02:00,440 Speaker 6: potentially catastrophic consequences defaulting on the US government debt would 42 00:02:01,400 --> 00:02:03,720 Speaker 6: you know, would have riven, you know, would have ricocheted 43 00:02:03,760 --> 00:02:07,040 Speaker 6: across the economy affecting families nationwide, and so we are 44 00:02:07,160 --> 00:02:10,520 Speaker 6: very glad there is a deal. You know, the President 45 00:02:10,639 --> 00:02:13,600 Speaker 6: fought hard for this deal and he secured a bipartisan 46 00:02:13,639 --> 00:02:16,320 Speaker 6: budget agreement that you know, this is a win for 47 00:02:16,360 --> 00:02:20,560 Speaker 6: the economy and the American people. And you know, he 48 00:02:20,760 --> 00:02:25,240 Speaker 6: proved again that he could you know, put his you know, 49 00:02:25,800 --> 00:02:29,400 Speaker 6: uh work hand in hand with you with Democrats to 50 00:02:29,440 --> 00:02:33,760 Speaker 6: be able to come up with a bipartisan process and 51 00:02:34,000 --> 00:02:37,240 Speaker 6: not having to give up anything of his uh, the 52 00:02:37,280 --> 00:02:39,160 Speaker 6: core agenda that he put in place over the past 53 00:02:39,240 --> 00:02:42,720 Speaker 6: couple of years. Now, let's be clear, this was hostage 54 00:02:42,760 --> 00:02:46,760 Speaker 6: taking by the Republicans, but you know, we always knew 55 00:02:46,760 --> 00:02:48,840 Speaker 6: that as we came up up to the budget that 56 00:02:48,919 --> 00:02:51,280 Speaker 6: this would have to be a bipartisan negotiation and that's 57 00:02:51,360 --> 00:02:54,600 Speaker 6: and that's what the President did, and he secured you know, uh, 58 00:02:55,040 --> 00:02:58,560 Speaker 6: a two year debt limit agreement and a pass forward 59 00:02:58,560 --> 00:02:59,040 Speaker 6: on the budget. 60 00:02:59,639 --> 00:02:59,799 Speaker 1: Yeah. 61 00:02:59,880 --> 00:03:02,600 Speaker 2: I thought you were going to say, is that the 62 00:03:02,680 --> 00:03:05,480 Speaker 2: great concern that progressives had that they were upset about 63 00:03:05,480 --> 00:03:09,520 Speaker 2: through this process was really focused largely on work requirements 64 00:03:09,800 --> 00:03:12,240 Speaker 2: among proposed cuts and so forth. But with regard to 65 00:03:12,280 --> 00:03:15,760 Speaker 2: work requirements, in the end, the net result was an 66 00:03:15,800 --> 00:03:19,760 Speaker 2: expansion of access to the SNAP food stamp program and 67 00:03:19,840 --> 00:03:23,760 Speaker 2: other social programs, to the point where some Republicans are 68 00:03:23,800 --> 00:03:27,480 Speaker 2: saying that Speaker McCarthy got rolled by President Biden. Would 69 00:03:27,720 --> 00:03:28,799 Speaker 2: do you not see it that way? 70 00:03:30,520 --> 00:03:33,040 Speaker 6: The important thing here is that the President focused on 71 00:03:33,120 --> 00:03:36,800 Speaker 6: maintaining his priorities, and certainly, you know, making sure that 72 00:03:36,880 --> 00:03:40,000 Speaker 6: veterans have access, that homeless folks have access to food 73 00:03:40,000 --> 00:03:43,920 Speaker 6: stamps was an important priority, and you know, making sure 74 00:03:44,000 --> 00:03:48,480 Speaker 6: that you know, as we worked through this process, that 75 00:03:48,640 --> 00:03:53,200 Speaker 6: his priorities were front loaded as things that he was 76 00:03:53,200 --> 00:03:55,480 Speaker 6: protecting as a part of this bipartisan agreement. 77 00:03:55,920 --> 00:03:59,000 Speaker 2: But that is accurate, right, that access to the SNAP 78 00:03:59,040 --> 00:04:02,160 Speaker 2: program has actually expanded in the end here net Net. 79 00:04:03,360 --> 00:04:05,800 Speaker 6: Yes, and I mean I think that is what it 80 00:04:05,800 --> 00:04:10,080 Speaker 6: looks like. I mean, certainly, it's important to remind your 81 00:04:10,120 --> 00:04:13,040 Speaker 6: listeners that this is a relatively small part of the 82 00:04:13,200 --> 00:04:16,920 Speaker 6: US population and so any estimates are of course very 83 00:04:16,920 --> 00:04:22,080 Speaker 6: both preliminary and subject to variant. But what is really 84 00:04:22,120 --> 00:04:26,520 Speaker 6: important is that those folks who are veterans, those folks 85 00:04:26,520 --> 00:04:31,400 Speaker 6: are homeless, do not have to deal with this onerous 86 00:04:31,640 --> 00:04:32,400 Speaker 6: work requirement. 87 00:04:32,920 --> 00:04:36,400 Speaker 2: There's more to talk about there, I'm sure, with regard 88 00:04:36,480 --> 00:04:38,280 Speaker 2: to the job market, and I know we have jobs 89 00:04:38,360 --> 00:04:40,320 Speaker 2: numbers out today that i'd like to ask you about 90 00:04:40,960 --> 00:04:45,039 Speaker 2: with regard to the rest of the bill. However, our 91 00:04:45,120 --> 00:04:48,359 Speaker 2: economists in house here at Bloomberg have crunched numbers to 92 00:04:48,400 --> 00:04:50,800 Speaker 2: show that this will have not a massive impact, but 93 00:04:50,839 --> 00:04:53,680 Speaker 2: a slightly negative one on economic growth GDP growth over 94 00:04:53,680 --> 00:04:56,640 Speaker 2: the next two years and could mean somewhere in the 95 00:04:56,720 --> 00:04:58,960 Speaker 2: area of three hundred and fifty to three hundred and 96 00:04:58,960 --> 00:05:03,280 Speaker 2: eighty thousand jobs. Realizing that's not what you were asking for. 97 00:05:03,360 --> 00:05:05,320 Speaker 2: Do you see it that way as well, that it's 98 00:05:05,720 --> 00:05:07,799 Speaker 2: not going to have a huge impact on the economy, 99 00:05:07,960 --> 00:05:09,760 Speaker 2: but possibly a slightly negative one. 100 00:05:10,920 --> 00:05:13,560 Speaker 6: Well, and it's interesting that we're having this conversation on 101 00:05:13,880 --> 00:05:17,840 Speaker 6: a morning when we also got very good data on 102 00:05:17,880 --> 00:05:20,880 Speaker 6: the labor market. The economy added three hundred and thirty 103 00:05:20,880 --> 00:05:23,920 Speaker 6: five three hundred and thirty nine thousand jobs last month, 104 00:05:25,440 --> 00:05:29,240 Speaker 6: very much above expectations. And you know, because of the 105 00:05:29,240 --> 00:05:31,720 Speaker 6: bold and decisive actions that the president took in the 106 00:05:31,960 --> 00:05:35,280 Speaker 6: early months of his presidency, we had seen this very 107 00:05:35,320 --> 00:05:40,480 Speaker 6: robust recovery. And I think what's really important is looking forward, 108 00:05:40,640 --> 00:05:43,200 Speaker 6: the investments that the President is making all across the 109 00:05:43,200 --> 00:05:46,200 Speaker 6: country through the Bipartisan Infrastructure Law, through the Chips and 110 00:05:46,240 --> 00:05:49,520 Speaker 6: Science Act, through the Inflation Reduction Act, that are going 111 00:05:49,560 --> 00:05:53,080 Speaker 6: to be building infrastructure, that are going to be investing 112 00:05:53,080 --> 00:05:58,000 Speaker 6: in semiconductor babs and boosting clean energy. These are all 113 00:05:58,720 --> 00:06:02,359 Speaker 6: investments in the long term productive capacity of the United States. 114 00:06:02,400 --> 00:06:07,560 Speaker 6: And we're already seeing indications of an uptick in investment 115 00:06:07,880 --> 00:06:14,240 Speaker 6: in the construction of these new new manufacturing facilities across 116 00:06:14,279 --> 00:06:19,120 Speaker 6: the country. So I think that there is the important 117 00:06:19,120 --> 00:06:22,400 Speaker 6: thing for the economy was to preserve those investments in 118 00:06:22,400 --> 00:06:24,880 Speaker 6: America that the presidents making that are going to deliver 119 00:06:24,960 --> 00:06:26,880 Speaker 6: the kinds of good jobs that people need to see 120 00:06:27,839 --> 00:06:28,640 Speaker 6: in the future. 121 00:06:29,440 --> 00:06:31,520 Speaker 2: There's a lot I'd like to ask you about with 122 00:06:31,640 --> 00:06:33,840 Speaker 2: regard to all of this, but I sin since we're 123 00:06:33,880 --> 00:06:37,800 Speaker 2: talking about the jobs report here, to see the headline 124 00:06:37,839 --> 00:06:41,680 Speaker 2: that black unemployment is coming off an historic low to 125 00:06:41,800 --> 00:06:46,279 Speaker 2: five point six percent, many would see as encouraging. We 126 00:06:46,320 --> 00:06:49,440 Speaker 2: did see a release today from the NAACP that refers 127 00:06:49,440 --> 00:06:52,279 Speaker 2: to the debt ceiling bill quote missing the mark for 128 00:06:52,400 --> 00:06:55,240 Speaker 2: black America. Are you concerned about the impact that this 129 00:06:55,480 --> 00:06:59,039 Speaker 2: legislation might have on black workers in this country? 130 00:07:00,480 --> 00:07:03,040 Speaker 6: Well, I'm an economist sewerage for the President. I get 131 00:07:03,120 --> 00:07:06,560 Speaker 6: up every day concerned about how our economic policies affect 132 00:07:06,560 --> 00:07:10,440 Speaker 6: working people across the country, including Black Americans. One of 133 00:07:10,480 --> 00:07:13,360 Speaker 6: the things we know about data is that you don't 134 00:07:13,400 --> 00:07:15,160 Speaker 6: ever want to make too much out of a one 135 00:07:15,200 --> 00:07:18,240 Speaker 6: month trend. And the thing about black unemployment is that 136 00:07:18,280 --> 00:07:20,640 Speaker 6: for the past two months it had been at historic lows, 137 00:07:21,240 --> 00:07:24,560 Speaker 6: and now we see a bit of a reversion. Certainly 138 00:07:24,600 --> 00:07:26,680 Speaker 6: we don't want to see it go up, but we 139 00:07:26,760 --> 00:07:28,680 Speaker 6: want to make sure that we are watching the trend, 140 00:07:28,840 --> 00:07:31,960 Speaker 6: not making two much out of any one month, moving 141 00:07:32,000 --> 00:07:34,120 Speaker 6: of the data around. If you look at that series, 142 00:07:34,440 --> 00:07:37,440 Speaker 6: there is a lot of volatility in it. I think 143 00:07:37,480 --> 00:07:40,320 Speaker 6: that when you look at the whole job market report 144 00:07:40,480 --> 00:07:44,680 Speaker 6: and you see the strong labor force participation, you see 145 00:07:44,680 --> 00:07:47,840 Speaker 6: the strong job gains, you see you know other data 146 00:07:47,920 --> 00:07:50,120 Speaker 6: that has come out recently, the lack of increases and 147 00:07:50,200 --> 00:07:53,520 Speaker 6: unemployment claims combined, this is a labor market that is 148 00:07:53,560 --> 00:07:56,640 Speaker 6: strong and is delivering. And let's remember that this is 149 00:07:56,680 --> 00:08:00,520 Speaker 6: still a relatively for Black Americans, relatively low ployment rate. 150 00:08:00,560 --> 00:08:03,160 Speaker 6: Although we always need to remember that the black unemployment 151 00:08:03,240 --> 00:08:06,440 Speaker 6: rate is too high relative to the rest of America, 152 00:08:07,160 --> 00:08:10,240 Speaker 6: that it's always higher than white Americans, and that is 153 00:08:10,280 --> 00:08:13,840 Speaker 6: a problem that the presidents Invest in America agenda. That 154 00:08:13,960 --> 00:08:16,600 Speaker 6: is why it is focused on investing across the country. 155 00:08:16,680 --> 00:08:18,600 Speaker 6: It is why it is focused on making sure to 156 00:08:18,680 --> 00:08:23,640 Speaker 6: prioritize investments in underserved communities, and why the President has 157 00:08:23,680 --> 00:08:26,360 Speaker 6: taken a whole of government equity lens for focusing on 158 00:08:26,400 --> 00:08:28,160 Speaker 6: how we can eliminate these gaps. 159 00:08:28,600 --> 00:08:30,600 Speaker 2: We're spending some time with doctor Heather Bouchet of the 160 00:08:30,600 --> 00:08:34,120 Speaker 2: White House Council of Economic Advisors here on Bloomberg Radio. 161 00:08:34,880 --> 00:08:36,840 Speaker 2: To your point here, we don't want to make a 162 00:08:36,880 --> 00:08:39,920 Speaker 2: trend out of one month, but I wonder your view 163 00:08:40,000 --> 00:08:42,120 Speaker 2: if we keep your economist hat on here for the 164 00:08:42,120 --> 00:08:45,760 Speaker 2: disparity between the two surveys, and what you make of that. 165 00:08:45,800 --> 00:08:48,520 Speaker 2: Does that signal a turning point in the job market 166 00:08:48,600 --> 00:08:50,480 Speaker 2: somehow Well, you. 167 00:08:50,440 --> 00:08:52,920 Speaker 6: Know, it's a great question. When we got the data, 168 00:08:53,040 --> 00:08:54,839 Speaker 6: that was one of the first things that popped out 169 00:08:54,880 --> 00:08:57,560 Speaker 6: to all of us, and we're like, wow, that the 170 00:08:57,720 --> 00:09:00,480 Speaker 6: bump up in the unemployment rate from three point four 171 00:09:00,520 --> 00:09:04,360 Speaker 6: to three point seven percent was a big, a big jump, 172 00:09:04,520 --> 00:09:07,640 Speaker 6: especially given what happened in the payroll data. But here's 173 00:09:07,679 --> 00:09:10,200 Speaker 6: the thing. You know, when we get the job data, 174 00:09:10,280 --> 00:09:14,960 Speaker 6: we have two different surveys, one of establishments businesses and 175 00:09:15,040 --> 00:09:17,280 Speaker 6: they tell us how many employees they have, and then 176 00:09:17,320 --> 00:09:20,920 Speaker 6: one of households, and the definition of employment is slightly 177 00:09:20,960 --> 00:09:24,480 Speaker 6: different across six two surveys, so they don't always match up. 178 00:09:24,640 --> 00:09:27,280 Speaker 6: And you know, I've been watching these surveys for decades, 179 00:09:27,360 --> 00:09:30,800 Speaker 6: and you know, you don't often see such a big gap. 180 00:09:30,960 --> 00:09:33,240 Speaker 6: But when you do. You know what we did is 181 00:09:33,280 --> 00:09:36,320 Speaker 6: we dug into the data and found actually, it's it's 182 00:09:36,360 --> 00:09:39,800 Speaker 6: really all about the different definitions. And once you adjust 183 00:09:39,880 --> 00:09:42,800 Speaker 6: the household survey to have the same definition of employment 184 00:09:43,120 --> 00:09:46,880 Speaker 6: as the payroll survey, that gap disappears. And here's the thing. 185 00:09:47,679 --> 00:09:50,440 Speaker 6: The jump in the unemployment rate was the aberration. You 186 00:09:50,440 --> 00:09:52,160 Speaker 6: look at all the data that's come out over the 187 00:09:52,160 --> 00:09:55,320 Speaker 6: past few weeks, you look at, you know, again, the 188 00:09:55,400 --> 00:10:00,280 Speaker 6: lack of increase in unemployment insurance claims that the Jolts data, 189 00:10:00,400 --> 00:10:03,560 Speaker 6: the Labor Turner for data that we got earlier this week, 190 00:10:03,920 --> 00:10:07,440 Speaker 6: and the fact that once you adjusted for this difference 191 00:10:07,440 --> 00:10:10,320 Speaker 6: in methodology, that it was more consistent with the larger 192 00:10:10,320 --> 00:10:13,880 Speaker 6: body of evidence really does indicate that this is a 193 00:10:13,960 --> 00:10:16,120 Speaker 6: strong labor market and we will see, you know, when 194 00:10:16,120 --> 00:10:17,680 Speaker 6: we get the data next month, whether or not this 195 00:10:17,760 --> 00:10:18,880 Speaker 6: is a part of a trend or not. 196 00:10:20,559 --> 00:10:21,800 Speaker 3: Yeah. 197 00:10:21,880 --> 00:10:24,520 Speaker 2: With that said, as well, does this job market as 198 00:10:24,559 --> 00:10:26,439 Speaker 2: you see it? But the point you just made is 199 00:10:26,480 --> 00:10:29,120 Speaker 2: this job market strong enough to keep the economy out 200 00:10:29,160 --> 00:10:29,800 Speaker 2: of a recession? 201 00:10:31,840 --> 00:10:34,199 Speaker 6: Well, you know, people keep asking us this. I feel like, 202 00:10:34,320 --> 00:10:36,400 Speaker 6: you know, months and months and months, and every month 203 00:10:36,480 --> 00:10:41,320 Speaker 6: we've continued to see job gains that have been beating expectations. 204 00:10:41,800 --> 00:10:43,640 Speaker 6: You know, this is what it looks like to be 205 00:10:43,840 --> 00:10:47,200 Speaker 6: promoting a full employment economy. This is the outcome of 206 00:10:47,240 --> 00:10:49,520 Speaker 6: the kinds of policies that the President Congress put into 207 00:10:49,520 --> 00:10:52,400 Speaker 6: place a couple of years ago. And this economy has 208 00:10:52,440 --> 00:10:56,280 Speaker 6: been able to weather a lot of challenges. Now, obviously, 209 00:10:57,200 --> 00:11:00,480 Speaker 6: you know there are you know, there's always the knowns. 210 00:11:00,559 --> 00:11:03,680 Speaker 6: But I think getting to this debt sealing challenge, having 211 00:11:03,720 --> 00:11:06,000 Speaker 6: this deal, being able to move on from this, and 212 00:11:06,040 --> 00:11:09,520 Speaker 6: then having it pass forward for the budget for next 213 00:11:09,600 --> 00:11:12,520 Speaker 6: year all gives us a lot of clarity that I 214 00:11:12,600 --> 00:11:17,400 Speaker 6: think gives me more confidence that this labor market is 215 00:11:17,559 --> 00:11:20,640 Speaker 6: on a more solid footing today than it certainly was 216 00:11:20,679 --> 00:11:22,080 Speaker 6: before the debt ceiling passed. 217 00:11:22,200 --> 00:11:24,960 Speaker 2: How about that you've been generous with your time. Doctor, 218 00:11:25,000 --> 00:11:27,000 Speaker 2: Before you go, I'll just ask you're getting back to 219 00:11:27,040 --> 00:11:29,760 Speaker 2: where we started with this debt limit deal. Does the 220 00:11:29,800 --> 00:11:32,480 Speaker 2: economist in you, and not a political question, does the 221 00:11:32,480 --> 00:11:35,040 Speaker 2: economist in you wish we didn't have to do this, 222 00:11:35,160 --> 00:11:36,760 Speaker 2: that we didn't have to do it again two years 223 00:11:36,800 --> 00:11:39,040 Speaker 2: from now. Should we eliminate the debt limit or reform 224 00:11:39,040 --> 00:11:39,600 Speaker 2: it somehow? 225 00:11:41,040 --> 00:11:42,560 Speaker 6: Well, you know, one of the things about the debt 226 00:11:42,600 --> 00:11:46,480 Speaker 6: limit is that there's many years where Congress just increases it, 227 00:11:46,880 --> 00:11:50,840 Speaker 6: no questions asked, just increases it without a lot of drama, 228 00:11:50,920 --> 00:11:52,640 Speaker 6: and then there's years like this year where there's a 229 00:11:52,679 --> 00:11:55,280 Speaker 6: lot of drama around it. The best thing for the 230 00:11:55,320 --> 00:11:59,240 Speaker 6: economy is greater certainty and not the kind of hostage 231 00:11:59,320 --> 00:12:02,320 Speaker 6: tasting that we saw happening over the past couple of months. So, 232 00:12:03,360 --> 00:12:04,880 Speaker 6: you know, we really want to make sure that we 233 00:12:04,920 --> 00:12:07,200 Speaker 6: are all focused on what's best for the American people, 234 00:12:07,360 --> 00:12:09,640 Speaker 6: and what is best is making sure that we keep 235 00:12:09,679 --> 00:12:12,640 Speaker 6: this economy on a solid path of growth, delivering good 236 00:12:12,720 --> 00:12:14,960 Speaker 6: jobs for Americans all across the country. So my hope 237 00:12:15,040 --> 00:12:16,720 Speaker 6: is is that we can all focus on that goal. 238 00:12:17,200 --> 00:12:19,600 Speaker 2: When does the President sign it does he doing that today? 239 00:12:21,840 --> 00:12:24,319 Speaker 6: I you know, I don't. I have been so busy 240 00:12:24,360 --> 00:12:26,440 Speaker 6: looking at the job summers, and I apologize I don't 241 00:12:26,440 --> 00:12:27,439 Speaker 6: know the answer to that question. 242 00:12:27,800 --> 00:12:29,360 Speaker 2: Well, it'll be nice to see it when it happens. 243 00:12:29,400 --> 00:12:31,640 Speaker 2: I know he's addressing the nation tonight. I figure it'll 244 00:12:31,640 --> 00:12:34,920 Speaker 2: happen between now and then. Doctor Heather Bruschet, many thanks 245 00:12:35,040 --> 00:12:37,360 Speaker 2: again for being with us from the White House, the 246 00:12:37,360 --> 00:12:40,160 Speaker 2: Council of Economic Advisor. She has the ear of the President, 247 00:12:41,720 --> 00:12:44,480 Speaker 2: much like the panel has your ear, and we assemble 248 00:12:44,720 --> 00:12:47,600 Speaker 2: our panel now. Jeanie Shanzano is with US Democratic Analyst 249 00:12:47,640 --> 00:12:50,880 Speaker 2: and of course Bloomberg Politics contributor, joined today by Lester 250 00:12:50,960 --> 00:12:53,760 Speaker 2: Months and Leicester's back with US Principle like government relations 251 00:12:53,760 --> 00:12:56,160 Speaker 2: Firm BG our group. Great to have you both here. 252 00:12:56,480 --> 00:12:58,680 Speaker 2: What's your thought on this, Genie? The President's going to 253 00:12:58,679 --> 00:13:02,400 Speaker 2: address the nation tonight and I suspect this is going 254 00:13:02,440 --> 00:13:04,800 Speaker 2: to be a fairly broad audience. But does he have 255 00:13:04,880 --> 00:13:08,160 Speaker 2: a message to the progressive Democrats who voted now. 256 00:13:08,559 --> 00:13:10,679 Speaker 7: Yeah, I think he does. I think he's been saying 257 00:13:10,720 --> 00:13:13,480 Speaker 7: for a long time. You know, I'm not going to, 258 00:13:13,559 --> 00:13:15,560 Speaker 7: you know, go out there and rant and rave in 259 00:13:15,559 --> 00:13:17,760 Speaker 7: front of reporters, but I am going to do the job, 260 00:13:17,840 --> 00:13:20,440 Speaker 7: so watch me. And the job got done, I think, 261 00:13:20,720 --> 00:13:22,840 Speaker 7: faster than most of us thought. The fact that the 262 00:13:22,880 --> 00:13:26,079 Speaker 7: Senate pushed this through last night, so he did the job. 263 00:13:26,160 --> 00:13:28,520 Speaker 7: The job got done. It's in the best interest of 264 00:13:28,559 --> 00:13:31,400 Speaker 7: the American people. And as he keeps saying, not everybody 265 00:13:31,440 --> 00:13:34,320 Speaker 7: gets what they want in a negotiation, but this is 266 00:13:34,360 --> 00:13:36,400 Speaker 7: the best thing for the American public, and it kept 267 00:13:36,480 --> 00:13:38,760 Speaker 7: us from default a place we never should have been. 268 00:13:38,800 --> 00:13:41,600 Speaker 7: It was reckless for Republicans to do that. And he 269 00:13:41,720 --> 00:13:44,040 Speaker 7: was able, nevertheless, to work with Kevin McCarthy in a 270 00:13:44,080 --> 00:13:46,880 Speaker 7: productive way to push this through and now we can 271 00:13:47,000 --> 00:13:50,280 Speaker 7: move forward to address the other challenges the country is facing. 272 00:13:50,480 --> 00:13:52,440 Speaker 2: So they actually got it done. Lester, I feel like 273 00:13:52,480 --> 00:13:54,920 Speaker 2: we should all meet for a drink later and the 274 00:13:54,960 --> 00:13:57,360 Speaker 2: President will speak tonight. You'll hear it on Bloomberg Radio 275 00:13:57,559 --> 00:14:01,080 Speaker 2: seven pm Eastern time. What's up with the Friday night speech? 276 00:14:01,120 --> 00:14:03,080 Speaker 2: Why not do it when the sun is up, have 277 00:14:03,120 --> 00:14:04,319 Speaker 2: a big signing ceremony. 278 00:14:05,080 --> 00:14:06,680 Speaker 8: I don't know. Maybe the President's going to have a 279 00:14:06,720 --> 00:14:12,080 Speaker 8: beer also to celebrate, and that would be news. Well, 280 00:14:12,120 --> 00:14:15,920 Speaker 8: good for him, good for him getting out there claim victory. 281 00:14:16,000 --> 00:14:19,560 Speaker 8: Spike the football a little bit as appropriate. He should 282 00:14:19,560 --> 00:14:22,040 Speaker 8: be doing that. What I hope he doesn't do is 283 00:14:22,120 --> 00:14:26,400 Speaker 8: try to at the same time he's claiming some credit 284 00:14:26,480 --> 00:14:29,200 Speaker 8: here talk down the other side that actually didn't deal 285 00:14:29,280 --> 00:14:32,720 Speaker 8: with him, And so I think he's got a difficult 286 00:14:32,760 --> 00:14:35,880 Speaker 8: messaging task where he needs to kind of motivate his base. 287 00:14:42,680 --> 00:14:46,080 Speaker 1: You're listening to the Bloomberg Sound On podcast. Catch the 288 00:14:46,120 --> 00:14:50,000 Speaker 1: program live weekdays at one Eastern on Bloomberg Radio, the 289 00:14:50,040 --> 00:14:53,400 Speaker 1: tune in app, Bloomberg dot Com, and the Bloomberg Business App. 290 00:14:53,520 --> 00:14:56,360 Speaker 1: You can also listen live on Amazon Alexa from our 291 00:14:56,400 --> 00:14:59,960 Speaker 1: flagship New York station. Just say Alexa, play Bloomberg. 292 00:15:02,120 --> 00:15:04,880 Speaker 2: It's all AI, all the time right now. Just ask 293 00:15:04,920 --> 00:15:07,400 Speaker 2: Wall Street, as we talk about all day every day. 294 00:15:07,480 --> 00:15:10,760 Speaker 2: If it's not in Nvidia, it's Microsoft C three AI, 295 00:15:10,960 --> 00:15:15,520 Speaker 2: somebody else, Google, You tell me, Chat, GPT. Maybe. As 296 00:15:15,520 --> 00:15:19,680 Speaker 2: the Biden administration finds a bit of division over how 297 00:15:20,000 --> 00:15:23,400 Speaker 2: these new tools should be regulated. We've touched on this before, 298 00:15:23,480 --> 00:15:27,000 Speaker 2: We've so far gotten nowhere. Washington can't figure out even 299 00:15:27,040 --> 00:15:30,040 Speaker 2: to do with what to do with crypto, never mind AI, 300 00:15:31,000 --> 00:15:33,600 Speaker 2: and it's very much in the air this week as 301 00:15:33,640 --> 00:15:38,560 Speaker 2: the USU Trade and Technology Council gathers in Sweden with 302 00:15:38,640 --> 00:15:42,040 Speaker 2: the EU's plan on the table here to subject generative 303 00:15:42,080 --> 00:15:44,840 Speaker 2: AI to additional rules. As I read the writing of 304 00:15:44,880 --> 00:15:47,920 Speaker 2: Anna Edgerton, Bloomberg's Anna Edgerton is with us right now 305 00:15:47,920 --> 00:15:51,080 Speaker 2: as a matter of fact, as we consider the divide 306 00:15:51,600 --> 00:15:54,920 Speaker 2: here within the administration, Anna, welcome back. It's great to 307 00:15:54,960 --> 00:15:57,920 Speaker 2: have you. If the White House itself can't even figure 308 00:15:57,920 --> 00:16:00,280 Speaker 2: out how to approach this, how is Washington and as 309 00:16:00,280 --> 00:16:02,440 Speaker 2: a whole going to do it well? 310 00:16:02,480 --> 00:16:04,520 Speaker 9: It is a really tricky question. And I'm glad you 311 00:16:04,560 --> 00:16:07,520 Speaker 9: mentioned chat GPT because that really has kind of scrambled 312 00:16:07,520 --> 00:16:10,960 Speaker 9: the regulatory environment for AI. You know, we saw how 313 00:16:11,280 --> 00:16:13,760 Speaker 9: both the US and EU were kind of aligned on 314 00:16:14,320 --> 00:16:17,640 Speaker 9: regulation that takes a risk based approach. Now, this is 315 00:16:18,360 --> 00:16:22,480 Speaker 9: rules that would apply to high risk artificial intelligence used 316 00:16:22,480 --> 00:16:26,200 Speaker 9: for things like critical infrastructure and law enforcement, that would 317 00:16:26,240 --> 00:16:29,080 Speaker 9: be subjected to higher levels of impliance. But with the 318 00:16:29,120 --> 00:16:32,520 Speaker 9: introduction of generative AI tools like chat GPT, you have 319 00:16:32,640 --> 00:16:35,960 Speaker 9: this kind of general purpose AI that isn't inherently risky. 320 00:16:36,280 --> 00:16:38,640 Speaker 9: But you see when it's used by hundreds of millions 321 00:16:38,680 --> 00:16:41,440 Speaker 9: of people every month, when it's used in all different 322 00:16:41,520 --> 00:16:44,720 Speaker 9: kinds of applications from you know, giving you know, eating 323 00:16:44,800 --> 00:16:48,680 Speaker 9: order just advice, to helping with homework, to you know, 324 00:16:48,800 --> 00:16:53,160 Speaker 9: creating powerpoints across the societal level. It really could have 325 00:16:53,720 --> 00:16:56,960 Speaker 9: more risky implications. So what they're really grappling with now 326 00:16:57,280 --> 00:16:59,560 Speaker 9: is how to regulate this generative AI. And that's where 327 00:16:59,560 --> 00:17:01,880 Speaker 9: we see this vision within the Biden administration. 328 00:17:02,160 --> 00:17:04,720 Speaker 2: Yeah, give us a sense of what the EU wants 329 00:17:04,760 --> 00:17:05,040 Speaker 2: to do. 330 00:17:06,200 --> 00:17:09,200 Speaker 9: So the EU had their AI Act pretty much set 331 00:17:09,240 --> 00:17:11,760 Speaker 9: to go. It did take this risk base approach, but 332 00:17:12,200 --> 00:17:15,600 Speaker 9: in the European Parliament version of this bill they introduced 333 00:17:16,840 --> 00:17:20,239 Speaker 9: more strict rules for generative AI. So we have some 334 00:17:20,359 --> 00:17:23,399 Speaker 9: from the Biden administration, including in the Commerce Department and 335 00:17:23,560 --> 00:17:26,000 Speaker 9: parts of the White House, who kind of think this 336 00:17:26,160 --> 00:17:28,200 Speaker 9: is a good idea, that we do need to have 337 00:17:28,240 --> 00:17:31,120 Speaker 9: stricter rules for generative AI. But then there are others, 338 00:17:31,119 --> 00:17:34,040 Speaker 9: like in the State Department and National Security officials who 339 00:17:34,080 --> 00:17:38,320 Speaker 9: are kind of casting a wherry eye towards China and saying, 340 00:17:38,359 --> 00:17:40,840 Speaker 9: you know, maybe we don't want to so heavily regulate 341 00:17:41,359 --> 00:17:44,760 Speaker 9: AI development in the Western world as it's trying to 342 00:17:44,760 --> 00:17:46,520 Speaker 9: compete with some of our global adversaries. 343 00:17:46,600 --> 00:17:48,399 Speaker 2: I know, you covered Congress for a long time, and 344 00:17:48,440 --> 00:17:50,760 Speaker 2: I suppose you still do depending on the issue here, 345 00:17:50,560 --> 00:17:53,480 Speaker 2: we're a long way from somebody writing legislation around this, 346 00:17:53,640 --> 00:17:56,240 Speaker 2: or never mind an administrative proposal, right. 347 00:17:56,960 --> 00:17:59,280 Speaker 9: That's right. I mean, we have kind of four bullet 348 00:17:59,280 --> 00:18:03,119 Speaker 9: points from Senate Majority Leader Chuck Schumer kind of outlining 349 00:18:03,160 --> 00:18:06,600 Speaker 9: where he wants to take eventual AI regulation. You have 350 00:18:06,680 --> 00:18:10,280 Speaker 9: some hearings kind of being held on an educational business 351 00:18:10,400 --> 00:18:13,240 Speaker 9: kind of just to help lawmakers get up to speed 352 00:18:13,280 --> 00:18:16,400 Speaker 9: on what artificial intelligence is. But we're a long way 353 00:18:16,440 --> 00:18:20,119 Speaker 9: from actually putting pens to paper writing legislation, much less 354 00:18:20,240 --> 00:18:22,400 Speaker 9: marking it up and signing bipartisan consensus. 355 00:18:22,840 --> 00:18:26,639 Speaker 2: Bloomberg's Anna Edgerton, great reporting and great conversation. Anna, thank you. 356 00:18:27,040 --> 00:18:29,520 Speaker 2: Let's stay close on this because it's a story that 357 00:18:29,600 --> 00:18:32,040 Speaker 2: again we're obsessed with at Bloomberg, because it's gripping the 358 00:18:32,080 --> 00:18:36,640 Speaker 2: markets right now. It's gripping businesses of all stripes. It's 359 00:18:36,680 --> 00:18:39,360 Speaker 2: not just retailers, it's not just law firms, it's not 360 00:18:39,400 --> 00:18:42,440 Speaker 2: just academia. It's just steeping into everything. Every conference call, 361 00:18:42,480 --> 00:18:45,479 Speaker 2: every earnings call. In this most recent cycle, you had 362 00:18:45,480 --> 00:18:49,160 Speaker 2: to mention AI to be taken seriously and I wonder 363 00:18:49,200 --> 00:18:52,520 Speaker 2: the Panels thoughts on this. Genie Shanzeno is with us. 364 00:18:52,680 --> 00:18:57,560 Speaker 2: Bloomberg Politics contributor, Democratic analyst and Republican strategist Leicster months 365 00:18:57,600 --> 00:19:01,120 Speaker 2: in of BGR group. Genie, at some point the administration, 366 00:19:01,240 --> 00:19:03,440 Speaker 2: particularly if there's a second Biden term, is going to 367 00:19:03,520 --> 00:19:04,159 Speaker 2: have to deal with this. 368 00:19:04,720 --> 00:19:06,919 Speaker 7: They will, and you know, the thinking is that the 369 00:19:06,960 --> 00:19:10,160 Speaker 7: White House, because they can use executive orders, as Anna mentioned, 370 00:19:10,160 --> 00:19:12,600 Speaker 7: they don't have to wait for Congress to act, they 371 00:19:12,640 --> 00:19:14,879 Speaker 7: may be able to move the needle on this faster. 372 00:19:15,040 --> 00:19:18,439 Speaker 7: But you know, Washington has been so slow. You mentioned 373 00:19:18,480 --> 00:19:22,679 Speaker 7: crypto tech in general, social media freak always seemed to 374 00:19:22,720 --> 00:19:25,480 Speaker 7: miss the boat. And I think that's what was frustrating 375 00:19:25,520 --> 00:19:27,520 Speaker 7: for some of us as we watch Sam Altman go 376 00:19:27,560 --> 00:19:30,639 Speaker 7: to Congress and sort of like Mark Zuckerberg, ask for 377 00:19:30,720 --> 00:19:33,680 Speaker 7: regulation and then when this EU Parliament proposals and it's 378 00:19:33,680 --> 00:19:36,720 Speaker 7: a mammoth one came out, you heard them say, well, 379 00:19:36,760 --> 00:19:38,560 Speaker 7: we'll take a look, but if we can't comply, we're 380 00:19:38,560 --> 00:19:40,800 Speaker 7: just going to stop operating in Europe. And you know, 381 00:19:41,160 --> 00:19:43,320 Speaker 7: that may be what we face in Europe, that may 382 00:19:43,359 --> 00:19:46,280 Speaker 7: be what we face around the world. If our legislators 383 00:19:46,280 --> 00:19:49,280 Speaker 7: can't get together and start figuring out a way to 384 00:19:49,400 --> 00:19:52,760 Speaker 7: regulate in these spaces, which has been the old story 385 00:19:52,800 --> 00:19:54,920 Speaker 7: in all of these spaces for Washington, DC. 386 00:19:55,440 --> 00:19:57,679 Speaker 2: Lester, I want to advance the conversation here to a 387 00:19:57,720 --> 00:20:01,119 Speaker 2: slightly scarier place, if you'll forget or indulge me. 388 00:20:01,240 --> 00:20:01,720 Speaker 1: Yeah. 389 00:20:02,000 --> 00:20:06,159 Speaker 2: And this comes from Congressman Seth Moulton, of course, a 390 00:20:06,240 --> 00:20:10,240 Speaker 2: veteran of the Marine Corps who's pretty involved in Pentagon 391 00:20:10,280 --> 00:20:12,320 Speaker 2: affairs as a member of the House, and he wrote 392 00:20:12,359 --> 00:20:16,879 Speaker 2: an op ed about AI and weapons and how we 393 00:20:16,960 --> 00:20:20,240 Speaker 2: need to start investing more in this because China, for instance, 394 00:20:20,280 --> 00:20:23,120 Speaker 2: is spending twice as much as we are, twice its 395 00:20:23,160 --> 00:20:26,760 Speaker 2: defense budget on AI that we are, and the potential 396 00:20:26,800 --> 00:20:30,199 Speaker 2: here for something going really wrong. Imagine Vladimir Putin, you know, 397 00:20:30,240 --> 00:20:35,320 Speaker 2: with a robot army in his hands, or AI controlled aircraft, 398 00:20:35,359 --> 00:20:37,879 Speaker 2: all of which apparently were on the precipice of having 399 00:20:38,400 --> 00:20:41,040 Speaker 2: and Congressman Moulton says it's time to get ahead of it. 400 00:20:41,080 --> 00:20:41,840 Speaker 2: Here's what he said. 401 00:20:42,080 --> 00:20:44,879 Speaker 10: That's the risk here that there are no moral guidelines, 402 00:20:44,920 --> 00:20:49,080 Speaker 10: there's no moral compass for autonomous weapons, or at least 403 00:20:49,119 --> 00:20:52,400 Speaker 10: it's very easy to shut it off. And given the destruction. 404 00:20:52,480 --> 00:20:55,639 Speaker 10: I mean, I mean Vladimir Putin is literally erasing Ukrainian cities. 405 00:20:55,680 --> 00:20:59,160 Speaker 10: You can very easily imagine him flipping that switch. That's 406 00:20:59,200 --> 00:21:01,280 Speaker 10: what's so danger about this. I think it could be 407 00:21:01,280 --> 00:21:04,760 Speaker 10: even more dangerous than nuclear weapons because we haven't established 408 00:21:04,800 --> 00:21:08,480 Speaker 10: any kinds of restrictions. We haven't established any international treaties, 409 00:21:08,480 --> 00:21:10,400 Speaker 10: no Geneva conventions. 410 00:21:09,960 --> 00:21:12,359 Speaker 2: He talked to us on balance of power on Bloomberg TV. 411 00:21:12,560 --> 00:21:14,760 Speaker 2: Is that the point here, Lester? We need a Geneva 412 00:21:14,840 --> 00:21:15,920 Speaker 2: Convention for AI. 413 00:21:17,200 --> 00:21:19,280 Speaker 8: I don't know if we're ready for that yet. It's 414 00:21:19,400 --> 00:21:22,679 Speaker 8: it's an interesting idea. I think we we do need 415 00:21:22,720 --> 00:21:25,840 Speaker 8: to be a little realistic here. There are already curbs 416 00:21:25,960 --> 00:21:30,000 Speaker 8: on behavior and the things governments are willing to do 417 00:21:30,240 --> 00:21:35,920 Speaker 8: in international affairs and in war, and AI doesn't necessarily 418 00:21:36,040 --> 00:21:38,960 Speaker 8: change those things. Vladimir Putin's not going to unleash something 419 00:21:39,600 --> 00:21:42,879 Speaker 8: that he can't ultimately be held responsible for. He invaded 420 00:21:42,960 --> 00:21:45,800 Speaker 8: Ukraine because he thought he can still he could survive 421 00:21:45,920 --> 00:21:48,640 Speaker 8: and thrive while still being held responsible for that under 422 00:21:48,640 --> 00:21:53,960 Speaker 8: our system. I'm not sure AI changes the you know, 423 00:21:54,040 --> 00:21:57,919 Speaker 8: this kind of basic human constraints and the things that 424 00:21:57,960 --> 00:21:59,720 Speaker 8: we have to do to get along in the world 425 00:21:59,760 --> 00:22:02,280 Speaker 8: as states and all of that, I'm not sure it 426 00:22:02,320 --> 00:22:04,119 Speaker 8: does doesn't mean we shouldn't be talking about it and 427 00:22:04,160 --> 00:22:06,320 Speaker 8: thinking about it. Seth Molton is a very smart guy 428 00:22:06,720 --> 00:22:08,639 Speaker 8: and and has certainly seen a lot of things, and 429 00:22:08,680 --> 00:22:10,919 Speaker 8: we should be paying attention to him. I don't know 430 00:22:10,960 --> 00:22:13,000 Speaker 8: that we're ready for a Geneva convention. I'm not even 431 00:22:13,000 --> 00:22:16,480 Speaker 8: sure what what an international treaty would look like. That's true, 432 00:22:16,520 --> 00:22:19,720 Speaker 8: We're not even we can't even pass something through Congress 433 00:22:19,400 --> 00:22:23,679 Speaker 8: that that regulates you know, personal data right less AI. 434 00:22:23,960 --> 00:22:26,359 Speaker 2: So it's a conversation that's going to get louder, and 435 00:22:26,359 --> 00:22:28,280 Speaker 2: it's one I hope that we'll continue having with Lester 436 00:22:28,400 --> 00:22:31,040 Speaker 2: Munson and Genie Shanzano. Many thanks to you both for 437 00:22:31,080 --> 00:22:34,320 Speaker 2: a great conversation. Hey, we lifted the debt ceiling. Have 438 00:22:34,359 --> 00:22:35,720 Speaker 2: a weekend. This is Bloomberg. 439 00:22:36,640 --> 00:22:40,160 Speaker 1: You're listening to the Bloomberg Sound on podcast. Catch us 440 00:22:40,200 --> 00:22:43,359 Speaker 1: live weekdays at one Eastern on Bloomberg dot com, the 441 00:22:43,440 --> 00:22:46,520 Speaker 1: iHeartRadio app, and the Bloomberg Business app, or listen on 442 00:22:46,600 --> 00:22:48,560 Speaker 1: demand wherever you get your podcasts. 443 00:22:49,720 --> 00:22:53,080 Speaker 2: I'm Joe Matthew along with Kayleie Lines in Washington with 444 00:22:53,119 --> 00:22:57,160 Speaker 2: our Eyes Now on the campaign trail, and Donald Trump 445 00:22:57,200 --> 00:23:01,800 Speaker 2: has made his way to Iowa, where Ronda Santis was 446 00:23:01,840 --> 00:23:03,920 Speaker 2: a couple of days this week. He's now gone through 447 00:23:03,960 --> 00:23:07,080 Speaker 2: New Hampshire and to South Carolina. So it's all about 448 00:23:07,119 --> 00:23:08,800 Speaker 2: the early voting states. And now that we're through this 449 00:23:08,880 --> 00:23:11,560 Speaker 2: madness in Washington, we can really start focusing on this. 450 00:23:11,680 --> 00:23:13,800 Speaker 2: You know, the president, the former president, Donald Trump is 451 00:23:14,119 --> 00:23:17,959 Speaker 2: he's pushing back on this idea by Ronda Santis that 452 00:23:18,000 --> 00:23:20,760 Speaker 2: the governor of Florida is a better candidate because he 453 00:23:20,800 --> 00:23:23,680 Speaker 2: can actually serve two terms. Yes, he keeps saying's gonna 454 00:23:23,680 --> 00:23:26,960 Speaker 2: take eight years to fix this. Donald Trump throwing back 455 00:23:26,960 --> 00:23:27,719 Speaker 2: on that last night. 456 00:23:27,760 --> 00:23:30,080 Speaker 5: But he's going around saying, go, well, I conserve for 457 00:23:30,080 --> 00:23:31,800 Speaker 5: eight years. It takes eight years to fix it. No, 458 00:23:31,920 --> 00:23:34,680 Speaker 5: he made a big mistake. Just like you don't change 459 00:23:34,720 --> 00:23:37,840 Speaker 5: your name in the middle of a election, change his 460 00:23:37,960 --> 00:23:39,720 Speaker 5: name in the middle of the election. You don't do that. 461 00:23:39,840 --> 00:23:42,240 Speaker 5: You do it before or after, but ideally you don't 462 00:23:42,240 --> 00:23:42,840 Speaker 5: do it at all. 463 00:23:43,000 --> 00:23:45,120 Speaker 2: Now did you hear about this name thing. I don't 464 00:23:45,119 --> 00:23:47,159 Speaker 2: even know if so. He used to call himself De 465 00:23:47,359 --> 00:23:49,400 Speaker 2: Santis and now it's DeSantis. 466 00:23:50,600 --> 00:23:51,720 Speaker 11: I guess. 467 00:23:53,080 --> 00:23:56,399 Speaker 2: I never noticed. I he was asked about it. Of 468 00:23:56,440 --> 00:23:58,119 Speaker 2: course in Hampshire. 469 00:23:57,720 --> 00:24:00,719 Speaker 3: There's been some confusion over your last name, the pronunciation, 470 00:24:00,800 --> 00:24:02,359 Speaker 3: and I'm just wondering to correct the record. 471 00:24:02,359 --> 00:24:02,800 Speaker 1: What is it? 472 00:24:02,840 --> 00:24:05,639 Speaker 3: Oh, that's ridiculous, the stupid things. Listen the way to 473 00:24:05,680 --> 00:24:06,840 Speaker 3: pronounce my last name. 474 00:24:07,520 --> 00:24:07,879 Speaker 1: Winner. 475 00:24:10,160 --> 00:24:10,679 Speaker 2: I don't know what. 476 00:24:12,800 --> 00:24:13,440 Speaker 11: I'm sorry. 477 00:24:13,960 --> 00:24:17,479 Speaker 2: The President also hitting him on his retail politics style. 478 00:24:19,680 --> 00:24:21,800 Speaker 2: Remember he got upset with some of this reporter with 479 00:24:21,800 --> 00:24:25,280 Speaker 2: shouting questions at him about interacting with voters. This was 480 00:24:25,720 --> 00:24:26,200 Speaker 2: in Iowa. 481 00:24:26,240 --> 00:24:27,920 Speaker 9: Why not taking any questions from voters? 482 00:24:27,920 --> 00:24:28,280 Speaker 8: Government? 483 00:24:30,680 --> 00:24:32,520 Speaker 9: Governor not taking questions from voter? 484 00:24:32,680 --> 00:24:34,639 Speaker 8: Now, I'm not coming up to be talking to me. 485 00:24:34,640 --> 00:24:35,360 Speaker 1: What are you talking about? 486 00:24:35,400 --> 00:24:37,800 Speaker 3: I'm not here word with people. Are you are you blind? 487 00:24:38,760 --> 00:24:40,040 Speaker 3: Are you blind? 488 00:24:40,160 --> 00:24:42,040 Speaker 9: Okay, so people are coming up to be talking to 489 00:24:42,040 --> 00:24:42,920 Speaker 9: me whatever they want to. 490 00:24:42,840 --> 00:24:43,400 Speaker 5: Talk to me about. 491 00:24:43,480 --> 00:24:45,080 Speaker 2: Are you blind? He said that was actually he was 492 00:24:45,080 --> 00:24:47,640 Speaker 2: still in Iowa. How would you feel as the reporter there? 493 00:24:47,640 --> 00:24:49,960 Speaker 2: Does that mean? Is that fair game? Does he get 494 00:24:49,960 --> 00:24:52,840 Speaker 2: points for beating up on the fake news media? What's the. 495 00:24:54,280 --> 00:24:56,119 Speaker 11: I'd rather not be told I was blind at a 496 00:24:56,320 --> 00:24:58,560 Speaker 11: given point. You know, you're asking a question, You're just 497 00:24:58,600 --> 00:25:01,840 Speaker 11: looking for the answer. But it seems that this is 498 00:25:01,960 --> 00:25:05,240 Speaker 11: just kind of the way that these politics are going 499 00:25:05,480 --> 00:25:06,080 Speaker 11: at the moment. 500 00:25:06,760 --> 00:25:09,199 Speaker 5: You really go after the one who's second, and I 501 00:25:09,200 --> 00:25:11,520 Speaker 5: think the one who's second is going down so much 502 00:25:11,600 --> 00:25:13,920 Speaker 5: and so rapidly that I don't think he's going to 503 00:25:13,960 --> 00:25:15,639 Speaker 5: be second that much longer. I think he's going to 504 00:25:15,640 --> 00:25:18,439 Speaker 5: be third or fourth. Had a very bad day that 505 00:25:18,520 --> 00:25:21,560 Speaker 5: he got very angry at the press. You're not allowed 506 00:25:21,600 --> 00:25:22,600 Speaker 5: to get angry at the press. 507 00:25:22,720 --> 00:25:26,080 Speaker 2: I thought that was at the fake news. 508 00:25:26,119 --> 00:25:27,360 Speaker 6: He got angry. 509 00:25:28,520 --> 00:25:30,240 Speaker 2: I thought we were the enemy of the American people. 510 00:25:30,359 --> 00:25:33,840 Speaker 11: Distinction between the press and then fakis. 511 00:25:35,320 --> 00:25:39,680 Speaker 2: Dave Price gets to endure this every day for what 512 00:25:40,320 --> 00:25:43,000 Speaker 2: the next six months? I guess nine months? When is 513 00:25:43,040 --> 00:25:46,000 Speaker 2: the he's the political director. You know, I could read 514 00:25:46,000 --> 00:25:50,120 Speaker 2: all these titles. Dave Price is the dean of Iowa politics, 515 00:25:50,119 --> 00:25:52,040 Speaker 2: which is why we have him on here the Des 516 00:25:52,040 --> 00:25:55,800 Speaker 2: Moines News. He's the managing editor at the NBC affiliate 517 00:25:56,240 --> 00:25:59,320 Speaker 2: in Iowa, and he's joining us from Des Moines. David's 518 00:25:59,320 --> 00:26:02,399 Speaker 2: great to have you on Bloomberg Radio. I hope that 519 00:26:02,440 --> 00:26:03,879 Speaker 2: we'll be talking a little bit over the course of 520 00:26:03,920 --> 00:26:06,280 Speaker 2: this campaign. Is IOA ready for this all over again? 521 00:26:07,640 --> 00:26:10,560 Speaker 3: I don't think it really ever stopped. So I think 522 00:26:10,640 --> 00:26:12,440 Speaker 3: people know they have to be ready. Right. 523 00:26:13,560 --> 00:26:17,760 Speaker 2: This has been a big question about Ron DeSantis' style 524 00:26:18,640 --> 00:26:21,080 Speaker 2: because Iowa, as you can tell us, is very different 525 00:26:21,119 --> 00:26:25,480 Speaker 2: than New Hampshire. There's no center really of activity, so 526 00:26:25,520 --> 00:26:28,480 Speaker 2: you kind of have to go everywhere. And he's really 527 00:26:28,880 --> 00:26:30,960 Speaker 2: planted his flag in Iowa. He mean, just like every 528 00:26:30,960 --> 00:26:32,800 Speaker 2: other word that comes out of his mouth is Iowa. 529 00:26:33,960 --> 00:26:35,960 Speaker 2: Is he doing this the right way? 530 00:26:37,840 --> 00:26:41,320 Speaker 3: He may, he may have to do it. So there's 531 00:26:41,400 --> 00:26:47,000 Speaker 3: the there's this thing here. The full longtime Senator Chuck 532 00:26:47,080 --> 00:26:52,160 Speaker 3: Grassley every year goes to all ninety nine of Iowa's counties, 533 00:26:52,200 --> 00:26:54,600 Speaker 3: and if you look at you look at a map, 534 00:26:56,040 --> 00:26:57,960 Speaker 3: you know we're sort of a middle of the road 535 00:26:58,040 --> 00:27:00,840 Speaker 3: stayed in the sense size wise, we have a bunch 536 00:27:00,840 --> 00:27:05,800 Speaker 3: of mostly square shaped counties that were created a gazillion 537 00:27:05,840 --> 00:27:10,760 Speaker 3: years ago really for the egg world in mind. But 538 00:27:11,960 --> 00:27:14,320 Speaker 3: Graftly every year goes to all of ninety ninety. So 539 00:27:14,400 --> 00:27:17,480 Speaker 3: it's kind of a legendary thing, become part of a 540 00:27:17,600 --> 00:27:23,240 Speaker 3: political folklore. So DeSantis, I believe, is going to try 541 00:27:23,280 --> 00:27:26,639 Speaker 3: to do that as well, and this will be a test. 542 00:27:26,800 --> 00:27:28,560 Speaker 3: It's one thing to come in here. You can ask 543 00:27:28,640 --> 00:27:31,439 Speaker 3: Rudy Giuliani how well this works, come in and give 544 00:27:31,480 --> 00:27:33,920 Speaker 3: a big speech, maybe shake some hands, and then head 545 00:27:33,960 --> 00:27:37,440 Speaker 3: out of town. It's another thing to really work it. 546 00:27:38,160 --> 00:27:40,199 Speaker 3: That's the retail side that we're going to see if 547 00:27:40,200 --> 00:27:42,760 Speaker 3: DeSantis can figure out how to do it. You can 548 00:27:42,800 --> 00:27:44,520 Speaker 3: go up there and give a speech that you've given 549 00:27:44,520 --> 00:27:46,920 Speaker 3: a bunch of times, but can you go out there 550 00:27:46,920 --> 00:27:49,960 Speaker 3: and really walk around in a room, shake hands and 551 00:27:50,160 --> 00:27:54,120 Speaker 3: people here? While this Iowa nice thing is a thing. 552 00:27:54,800 --> 00:27:57,760 Speaker 3: It can be very direct with you as they have 553 00:27:57,840 --> 00:28:00,480 Speaker 3: a hole in your hand and say, you know, hey, 554 00:28:00,520 --> 00:28:03,000 Speaker 3: what do you think about ethanol? What do you think 555 00:28:03,040 --> 00:28:06,760 Speaker 3: about school choice? What do you think about row? Whatever 556 00:28:06,800 --> 00:28:09,800 Speaker 3: it is? But they can be very direct with their questions. 557 00:28:09,840 --> 00:28:11,280 Speaker 3: There's a polite way to do it, and they know 558 00:28:11,320 --> 00:28:13,160 Speaker 3: how to do it well. 559 00:28:13,200 --> 00:28:15,000 Speaker 11: And then so I guess it becomes a question of 560 00:28:15,000 --> 00:28:18,320 Speaker 11: what they want to hear. The candidates say what messages? 561 00:28:18,359 --> 00:28:21,080 Speaker 11: Granted it's early seem to be resonating. 562 00:28:20,720 --> 00:28:25,400 Speaker 3: At this point, it's you know, you have a lot 563 00:28:25,440 --> 00:28:28,600 Speaker 3: of What I'm fascinated with is who is going to 564 00:28:28,680 --> 00:28:33,119 Speaker 3: expand the message? Perhaps because so many of the Trump 565 00:28:33,359 --> 00:28:39,720 Speaker 3: challengers are talking about I'm the anti woke person, and 566 00:28:39,840 --> 00:28:42,720 Speaker 3: we need to make sure parents are in charge of schools. 567 00:28:42,840 --> 00:28:48,719 Speaker 3: We need to have kids play the sports according to 568 00:28:48,840 --> 00:28:52,960 Speaker 3: their gender assigned birth. All of those kind of cultural 569 00:28:53,240 --> 00:28:59,920 Speaker 3: social issues. Not a lot of economic matters other than 570 00:29:00,560 --> 00:29:04,160 Speaker 3: you know, your inflation, gas prices, whatever, which you know 571 00:29:04,280 --> 00:29:07,560 Speaker 3: is not fortunately not ash as those things once were. 572 00:29:08,040 --> 00:29:11,200 Speaker 3: But so a lot of the messages are similar. Now. 573 00:29:11,480 --> 00:29:14,640 Speaker 3: Donald Trump is Donald Trump, right. He's a unique force. 574 00:29:14,760 --> 00:29:17,640 Speaker 3: And you've you've played a couple of clips yesterday from 575 00:29:17,680 --> 00:29:21,000 Speaker 3: the events I was with him, and he's a free 576 00:29:21,000 --> 00:29:24,360 Speaker 3: wheeler man, like he can can go do his speech. 577 00:29:24,880 --> 00:29:26,920 Speaker 3: A lot of times. He doesn't use notes, so you 578 00:29:27,000 --> 00:29:29,200 Speaker 3: may he may make a point, he may make that 579 00:29:29,240 --> 00:29:32,520 Speaker 3: same point later on, but then he turns it up, 580 00:29:32,960 --> 00:29:35,240 Speaker 3: turns it over to the crowd. And he did that 581 00:29:35,320 --> 00:29:37,680 Speaker 3: at his third event of the day yesterday, And that's 582 00:29:37,680 --> 00:29:41,120 Speaker 3: his little subtle dig at Disantis, since hasn't had one 583 00:29:41,160 --> 00:29:44,320 Speaker 3: of those yet. And Trump probably took I think it 584 00:29:44,360 --> 00:29:47,480 Speaker 3: was either eleven or twelve questions from people, and he's 585 00:29:47,800 --> 00:29:51,800 Speaker 3: very comfortable doing that. I think one thing that I'm 586 00:29:51,800 --> 00:29:54,360 Speaker 3: not sure made a lot of national news was that 587 00:29:54,800 --> 00:29:59,240 Speaker 3: he largely decided not to make fun of Joe Biden's 588 00:29:59,520 --> 00:30:00,600 Speaker 3: fall yesterday. 589 00:30:00,880 --> 00:30:03,040 Speaker 2: Yeah, we've actually got that here. It was. It was 590 00:30:03,080 --> 00:30:06,120 Speaker 2: a pretty incredible moment, actually, and I guess it's Dave 591 00:30:06,160 --> 00:30:07,479 Speaker 2: because he's been there a little bit. 592 00:30:09,320 --> 00:30:12,400 Speaker 3: Right. There was a woman in the crowd who had asked, 593 00:30:12,480 --> 00:30:14,400 Speaker 3: and I think I know I first saw it on 594 00:30:14,560 --> 00:30:17,240 Speaker 3: social media during that third event of the day. I 595 00:30:17,400 --> 00:30:20,440 Speaker 3: presume Trump had not heard about it yet. Did it 596 00:30:20,600 --> 00:30:23,120 Speaker 3: just happened? Woman in the crowd said, Hey, I'm seeing 597 00:30:23,160 --> 00:30:25,600 Speaker 3: on my phone that Joe Biden fell again, and you 598 00:30:25,640 --> 00:30:27,880 Speaker 3: know a couple of people are laughing and cat calling 599 00:30:27,960 --> 00:30:30,800 Speaker 3: and all that kind of stuff. And Trump's response was 600 00:30:30,840 --> 00:30:32,320 Speaker 3: not to make fun of him. He said, oh he did. 601 00:30:32,440 --> 00:30:34,320 Speaker 3: That's too bad, right, I hope he's not hurt. 602 00:30:34,560 --> 00:30:36,760 Speaker 2: We've we've got it right here, Dave Price. Let's listen. 603 00:30:36,880 --> 00:30:37,440 Speaker 3: You gotta be. 604 00:30:37,400 --> 00:30:38,239 Speaker 12: Careful about that. 605 00:30:38,800 --> 00:30:41,240 Speaker 5: You gotta be careful about that, because you don't you 606 00:30:41,280 --> 00:30:44,320 Speaker 5: don't want that. Even if you have to tiptoe down 607 00:30:44,320 --> 00:30:44,800 Speaker 5: a ramp. 608 00:30:44,840 --> 00:30:45,320 Speaker 3: He got a. 609 00:30:45,320 --> 00:30:50,400 Speaker 2: Tip, it comes back immediately, you know, it's Trump. 610 00:30:51,200 --> 00:30:53,680 Speaker 5: That was the best speech I think I've ever made. 611 00:30:54,680 --> 00:30:56,920 Speaker 5: And it was pouring rayan and it was horrible and 612 00:30:57,000 --> 00:30:59,840 Speaker 5: cold and windy, and they have a ramp that was pure, 613 00:31:00,080 --> 00:31:02,160 Speaker 5: like a nice skating rink, and it was like twenty 614 00:31:02,240 --> 00:31:04,760 Speaker 5: five feet long. And I talked to the general and 615 00:31:04,760 --> 00:31:06,720 Speaker 5: he has boots on, you know, big combat boots and 616 00:31:06,720 --> 00:31:07,640 Speaker 5: their rubber. 617 00:31:07,560 --> 00:31:13,240 Speaker 12: Soles, and I have nice leather to it. And uh, 618 00:31:13,440 --> 00:31:15,520 Speaker 12: I say, you know what, Jenna, get ready if I 619 00:31:15,560 --> 00:31:17,720 Speaker 12: grab you, you just get ready because I got this 620 00:31:17,840 --> 00:31:21,560 Speaker 12: stupid ramp that somebody put up and there's no stairs, 621 00:31:21,680 --> 00:31:24,680 Speaker 12: right And I said, so I tiptoed down, and I 622 00:31:24,840 --> 00:31:25,560 Speaker 12: suffered for that. 623 00:31:25,640 --> 00:31:29,240 Speaker 5: They never covered my speech, but everybody, the smart. 624 00:31:29,000 --> 00:31:29,960 Speaker 13: People understood that. 625 00:31:30,040 --> 00:31:31,640 Speaker 12: But uh, that's too bad. 626 00:31:31,680 --> 00:31:32,600 Speaker 5: If you felt it's too. 627 00:31:32,440 --> 00:31:34,760 Speaker 2: Bad, it's if he felt it's too bad. That does 628 00:31:34,840 --> 00:31:38,360 Speaker 2: not sound like Donald Trump. Although I have to admit, Kaylee, 629 00:31:38,400 --> 00:31:41,000 Speaker 2: it was pretty sunny that day when he went down 630 00:31:41,040 --> 00:31:43,800 Speaker 2: the ramp West Point. It was the skies were blue 631 00:31:43,840 --> 00:31:44,480 Speaker 2: and it was sunny. 632 00:31:45,000 --> 00:31:48,360 Speaker 11: Context is important, Joe, but yeah, it was a unique moment. 633 00:31:48,360 --> 00:31:50,680 Speaker 11: And Dave, to bring you back in here, what do 634 00:31:50,720 --> 00:31:53,040 Speaker 11: you think about that? Is this like a shift in 635 00:31:53,160 --> 00:31:57,560 Speaker 11: terms of how Donald Trump's thinking about talking to his 636 00:31:58,040 --> 00:32:01,080 Speaker 11: opponents or talking about his opponents At the Democratic one, 637 00:32:01,480 --> 00:32:02,840 Speaker 11: the Republicans or another matter. 638 00:32:03,840 --> 00:32:06,200 Speaker 3: I think this might be one. I don't know that 639 00:32:06,280 --> 00:32:09,120 Speaker 3: this is going to represent an overall theme here. And 640 00:32:09,160 --> 00:32:13,160 Speaker 3: now you know Trump used that. You know, he masterfully 641 00:32:13,160 --> 00:32:15,520 Speaker 3: works the crowd, and of course he works them embellishment 642 00:32:15,600 --> 00:32:18,760 Speaker 3: into that his ramp story. And we all know Secret 643 00:32:18,760 --> 00:32:22,080 Speaker 3: Service would never let a current president president have to 644 00:32:22,120 --> 00:32:26,160 Speaker 3: walk down an icy ramp. There's no one on earth 645 00:32:26,200 --> 00:32:30,680 Speaker 3: who believes that that would be the protocol. We thought 646 00:32:30,680 --> 00:32:34,600 Speaker 3: it was fascinating that this that Trump, you know, he 647 00:32:34,680 --> 00:32:37,680 Speaker 3: is seventy six himself chose not to take a pot 648 00:32:37,720 --> 00:32:42,400 Speaker 3: shot at Biden's age, fragility, anything like that, and other 649 00:32:42,480 --> 00:32:45,960 Speaker 3: than saying sad and I think during Hannity's thing last night, 650 00:32:46,040 --> 00:32:49,200 Speaker 3: I think he said something similar. He's got plenty to 651 00:32:49,240 --> 00:32:53,000 Speaker 3: say about other things, but it seems like he's cognizant 652 00:32:53,080 --> 00:32:55,880 Speaker 3: enough to know that as DeSantis may be his chief 653 00:32:56,000 --> 00:32:59,800 Speaker 3: rival now who's thirty years his junior, that perhaps poking 654 00:33:00,040 --> 00:33:02,640 Speaker 3: on a Biden's age may not be a wise move. 655 00:33:02,880 --> 00:33:07,080 Speaker 2: Yeah, interesting how this all works. The latest numbers that 656 00:33:07,160 --> 00:33:11,360 Speaker 2: I've at least seen from Iowa Dave comes from Emerson 657 00:33:11,920 --> 00:33:15,000 Speaker 2: and the numbers Donald Trump's been reading them for a 658 00:33:15,040 --> 00:33:19,920 Speaker 2: reason are skewed pretty heavy in his favor Trump sixty two, 659 00:33:20,000 --> 00:33:23,040 Speaker 2: DeSantis twenty. And then you go to single digits, Snicky 660 00:33:23,080 --> 00:33:26,200 Speaker 2: Haley's at five, Mike Pence at five, Mike Pence launching 661 00:33:26,240 --> 00:33:30,719 Speaker 2: his campaign there next week, Dave, and he loves him 662 00:33:30,800 --> 00:33:34,920 Speaker 2: from Iowa too, and the evangelical community in Iowa loves 663 00:33:34,960 --> 00:33:36,880 Speaker 2: some Mike Pence. Is he going to make a dent there? 664 00:33:38,800 --> 00:33:41,560 Speaker 3: Boy? It is an uphill climb for him. If you 665 00:33:41,600 --> 00:33:44,440 Speaker 3: look at some of his early crowds, and you know, 666 00:33:44,480 --> 00:33:49,640 Speaker 3: he probably has as much street cred with the evangelical 667 00:33:49,760 --> 00:33:55,640 Speaker 3: folks as anyone could, but you definitely saw some of 668 00:33:55,680 --> 00:33:59,959 Speaker 3: his support disappear on him when he refused to follow 669 00:34:00,080 --> 00:34:06,120 Speaker 3: Trump's orders regarding January sixth. And it's I think he's 670 00:34:06,200 --> 00:34:09,560 Speaker 3: committed to also trying to campaign in all ninety nine 671 00:34:09,600 --> 00:34:13,479 Speaker 3: counties and we'll really have to work it hard here. 672 00:34:13,560 --> 00:34:18,040 Speaker 3: But putting together a path for him unless he wants 673 00:34:18,080 --> 00:34:20,680 Speaker 3: to plan a different course of action to kind of 674 00:34:20,719 --> 00:34:23,760 Speaker 3: go full boar against Trump, which would not be his style, 675 00:34:24,880 --> 00:34:26,960 Speaker 3: it really seems uphill for him. 676 00:34:27,920 --> 00:34:29,839 Speaker 11: Well, as we talked about all of the effort that 677 00:34:30,080 --> 00:34:32,600 Speaker 11: Pence and the other candidates are putting into Iowa hitting 678 00:34:32,640 --> 00:34:36,200 Speaker 11: all ninety nine of those square counties. Is there a 679 00:34:36,280 --> 00:34:38,879 Speaker 11: sense that it really still is worth it? And not 680 00:34:38,920 --> 00:34:41,520 Speaker 11: to insult your Iowa here, Dave, but does it still 681 00:34:41,560 --> 00:34:44,279 Speaker 11: hold the same weight, the same importance as it has 682 00:34:44,320 --> 00:34:45,520 Speaker 11: in election cycles past. 683 00:34:47,640 --> 00:34:50,040 Speaker 3: Well, if you're looking at travel schedules, then I would 684 00:34:50,040 --> 00:34:53,759 Speaker 3: selfishly say yes, coming here so often. And this is 685 00:34:53,840 --> 00:34:56,719 Speaker 3: kind of a rare quiet day in the sense that 686 00:34:56,800 --> 00:35:00,200 Speaker 3: we're going to have eight of them here tomorrow. The 687 00:35:00,200 --> 00:35:03,279 Speaker 3: most relieved person is Senator Jony Ernst, who's hosting this 688 00:35:03,320 --> 00:35:07,240 Speaker 3: big event tomorrow. She was chewing her fingernails off fearing 689 00:35:07,280 --> 00:35:10,400 Speaker 3: that she'll be doing that death ceiling vote tomorrow indeed 690 00:35:10,640 --> 00:35:13,680 Speaker 3: instead of hosting her big annual fundraisers. So at least 691 00:35:13,680 --> 00:35:16,600 Speaker 3: that things settled. But there are eight people tomorrow, I mean, 692 00:35:16,640 --> 00:35:20,040 Speaker 3: I think that shows that that there's still a lot 693 00:35:20,040 --> 00:35:23,040 Speaker 3: of focus here. Now we'll see going forward. You know, 694 00:35:23,040 --> 00:35:26,000 Speaker 3: when Chris Christy launches this week, you know, if he's 695 00:35:26,040 --> 00:35:28,239 Speaker 3: going to do more of a New Hampshire strategy, we'll 696 00:35:28,239 --> 00:35:31,399 Speaker 3: see what Kristin and does. You know, there may be 697 00:35:31,480 --> 00:35:35,759 Speaker 3: some others who decide that New Hampshire's friendly or to 698 00:35:35,880 --> 00:35:39,920 Speaker 3: their to their potential than Iowa maybe, but it seems 699 00:35:39,960 --> 00:35:42,800 Speaker 3: as as we talk right now, that Iowa is still 700 00:35:42,840 --> 00:35:44,000 Speaker 3: going to be a big player. 701 00:35:44,719 --> 00:35:47,239 Speaker 2: Will you meet us at the Iowa State Fair in. 702 00:35:47,160 --> 00:35:49,879 Speaker 3: August's good, plenty of good food there. 703 00:35:54,680 --> 00:35:58,040 Speaker 2: That's right. We've got the elastic waste ready, Dave Price, 704 00:35:58,120 --> 00:36:01,200 Speaker 2: great to talk, come back and see us, the dean 705 00:36:01,280 --> 00:36:05,520 Speaker 2: of Iowa politics from the Des Moines News and Who 706 00:36:05,680 --> 00:36:08,640 Speaker 2: thirteen maybe they call it who thirteen. We've got to 707 00:36:08,680 --> 00:36:10,879 Speaker 2: do the show for the I'm thinking this happens. I'm 708 00:36:10,920 --> 00:36:14,440 Speaker 2: at the website. Yeah, sixty eight days, nine hours, forty 709 00:36:14,480 --> 00:36:18,600 Speaker 2: two minutes the Iowa State Fair August tenth. We're gonna 710 00:36:18,600 --> 00:36:22,040 Speaker 2: go corn dogs and fried twinkies. 711 00:36:21,920 --> 00:36:22,960 Speaker 11: My late birthday party. 712 00:36:23,320 --> 00:36:26,719 Speaker 2: Yeah, all right, that's a plan. There. 713 00:36:26,760 --> 00:36:27,040 Speaker 1: You have. 714 00:36:27,200 --> 00:36:28,960 Speaker 2: The campaign as we know it today is going to 715 00:36:29,000 --> 00:36:30,759 Speaker 2: look different next week, and we'll talk about it a 716 00:36:30,800 --> 00:36:33,120 Speaker 2: lot more than with Kaylie Lines. I'm Joe, Matthew and 717 00:36:33,239 --> 00:36:35,840 Speaker 2: Washington on sound On. This is Bloomberg. 718 00:36:41,760 --> 00:36:45,120 Speaker 1: You're listening to the Bloomberg Sound On podcast. Catch the 719 00:36:45,160 --> 00:36:49,040 Speaker 1: program live weekdays at one eastern on Bloomberg Radio, the 720 00:36:49,080 --> 00:36:52,440 Speaker 1: tune in app, Bloomberg dot Com, and the Bloomberg Business app. 721 00:36:52,560 --> 00:36:55,400 Speaker 1: You can also listen live on Amazon Alexa from our 722 00:36:55,440 --> 00:37:01,759 Speaker 1: flagship New York station, Just say Alexa play Bloomberg eleven thirty. 723 00:37:01,600 --> 00:37:05,600 Speaker 2: On Jobs Day. But it's kind of hard to put 724 00:37:05,600 --> 00:37:07,759 Speaker 2: a headline on it, Kaylee lines. It's sort of a 725 00:37:07,760 --> 00:37:10,640 Speaker 2: mixed report because the two surveys don't exactly agree, although 726 00:37:10,680 --> 00:37:13,719 Speaker 2: by the looks of Wall Street, people are accentuating the 727 00:37:13,760 --> 00:37:16,480 Speaker 2: positive and all coming off the debt ceiling vote last night, 728 00:37:17,080 --> 00:37:20,040 Speaker 2: which means we live to see another day. No defaults 729 00:37:20,040 --> 00:37:21,040 Speaker 2: on Monday. 730 00:37:21,200 --> 00:37:24,920 Speaker 11: Yes, although what's interesting to me here on just the 731 00:37:24,960 --> 00:37:27,840 Speaker 11: default subject before we get back to jobs is Fitch Ratings. 732 00:37:28,000 --> 00:37:29,840 Speaker 11: We all talked about a few weeks ago for putting 733 00:37:29,840 --> 00:37:33,080 Speaker 11: the US's triple A rating on negative way, which. 734 00:37:32,880 --> 00:37:35,480 Speaker 2: By the way, got very little coverage. Yes, it was 735 00:37:35,560 --> 00:37:37,200 Speaker 2: kind of a big deal here at Bloomberg, but did 736 00:37:37,200 --> 00:37:39,399 Speaker 2: not get mainstream coverage, I'm assuming because most people don't 737 00:37:39,400 --> 00:37:39,960 Speaker 2: really kind of. 738 00:37:39,960 --> 00:37:42,200 Speaker 11: Got it and it wasn't a full den isn't actual 739 00:37:42,360 --> 00:37:44,919 Speaker 11: just kind of a warning. But what's interesting is they 740 00:37:45,440 --> 00:37:47,400 Speaker 11: came out today and said, even though you had the 741 00:37:47,400 --> 00:37:51,040 Speaker 11: mill passing, we're keeping it there because of the impasse, 742 00:37:51,760 --> 00:37:54,440 Speaker 11: the difficulty, and then they need to assess what this 743 00:37:54,520 --> 00:37:58,360 Speaker 11: actually means in terms of the medium term fiscal trajectory. 744 00:37:58,360 --> 00:38:02,319 Speaker 2: Interesting knowing the S and P downgrade followed the deal 745 00:38:02,440 --> 00:38:05,120 Speaker 2: back in twenty eleven for a lot of the same reasons, 746 00:38:06,040 --> 00:38:08,839 Speaker 2: so we're kind of wondering what that means for our 747 00:38:08,880 --> 00:38:11,480 Speaker 2: credit worthiness, even though we are avoiding a default and 748 00:38:11,480 --> 00:38:13,799 Speaker 2: we don't want to confuse those two things. But yeah, 749 00:38:13,840 --> 00:38:16,239 Speaker 2: Fitch is sticking by its guns and the warning is 750 00:38:16,239 --> 00:38:18,239 Speaker 2: in place. I mean, does that indicate that they could 751 00:38:18,320 --> 00:38:19,799 Speaker 2: downgrade in any time they want? 752 00:38:20,320 --> 00:38:24,200 Speaker 11: I guess that the risk remains there. I mean, remember 753 00:38:24,200 --> 00:38:27,560 Speaker 11: when S and P Global Ratings downgraded the US back 754 00:38:27,560 --> 00:38:30,120 Speaker 11: in twenty eleven, it was because of the longer term 755 00:38:30,160 --> 00:38:33,040 Speaker 11: fiscal trajectory. So kind of this real better? 756 00:38:33,200 --> 00:38:36,600 Speaker 2: I mean, it's gotten worse, yeah, by many trillions of dollars, But. 757 00:38:36,560 --> 00:38:38,520 Speaker 11: At least we have a strong job support show. 758 00:38:38,920 --> 00:38:39,640 Speaker 2: Yes we do. 759 00:38:40,600 --> 00:38:40,920 Speaker 12: We do. 760 00:38:40,960 --> 00:38:43,239 Speaker 2: And when that came out, everybody of course thought, oh boy, 761 00:38:43,280 --> 00:38:45,799 Speaker 2: we're going to start recalibrating the FED here. But then 762 00:38:45,840 --> 00:38:48,600 Speaker 2: when you see the household survey, it makes you slow down. 763 00:38:48,600 --> 00:38:52,200 Speaker 2: That thought is, are they sort of canceling each other out? 764 00:38:52,880 --> 00:38:53,000 Speaker 6: Uh? 765 00:38:53,239 --> 00:38:56,360 Speaker 11: Well, it may be that or maybe the other components 766 00:38:56,400 --> 00:39:01,879 Speaker 11: of the data, uh, the idea that the unemployment rate 767 00:39:01,920 --> 00:39:04,640 Speaker 11: went up to three point seven percent, wage growth cooled 768 00:39:04,680 --> 00:39:08,120 Speaker 11: down to four point three percent. So the headline figure 769 00:39:08,200 --> 00:39:10,520 Speaker 11: sure suggests that the labor market is booming, but some 770 00:39:10,560 --> 00:39:13,480 Speaker 11: of these other indicators that are very important to the 771 00:39:13,480 --> 00:39:17,399 Speaker 11: FED didn't do so. So let's continue this conversation. Ethan 772 00:39:17,400 --> 00:39:19,239 Speaker 11: Harris is joining us now. He is head of a 773 00:39:19,640 --> 00:39:23,239 Speaker 11: global economics at Bank of America. Ethan, we have a 774 00:39:23,239 --> 00:39:25,600 Speaker 11: lot to discuss with you, including the fiscal picture here 775 00:39:25,640 --> 00:39:29,000 Speaker 11: in the US, but just first on jobs. The payrolls 776 00:39:29,000 --> 00:39:30,920 Speaker 11: figure so hot you can't touch it, but you do 777 00:39:31,000 --> 00:39:33,960 Speaker 11: have this cooling in wage growth, you have an unemployment 778 00:39:34,000 --> 00:39:36,120 Speaker 11: rate tacking up. How should we be thinking about this 779 00:39:36,160 --> 00:39:37,200 Speaker 11: and what it means for the FED? 780 00:39:38,480 --> 00:39:41,520 Speaker 13: Well, it's telling us that the labor market's still pretty hot. 781 00:39:41,719 --> 00:39:45,680 Speaker 13: I mean everyone knows. Everyone knows the payroll number is 782 00:39:45,760 --> 00:39:50,000 Speaker 13: much better measurement than the household survey. And this wasn't 783 00:39:50,120 --> 00:39:53,000 Speaker 13: just a strong reading. This was off the charts. I 784 00:39:53,000 --> 00:39:55,960 Speaker 13: mean he had ninety thousand upper divisions, he had a 785 00:39:56,000 --> 00:40:00,680 Speaker 13: three hundred thousand plus headline. Yeah, can take a little 786 00:40:00,680 --> 00:40:05,279 Speaker 13: bit of consolation from the support. But you know, this 787 00:40:05,440 --> 00:40:08,239 Speaker 13: was a This was a clearly strong report and it 788 00:40:08,280 --> 00:40:10,200 Speaker 13: adds a little extra pressure on the FED. 789 00:40:11,640 --> 00:40:14,160 Speaker 2: What does it mean then for the dot plot from 790 00:40:14,200 --> 00:40:15,400 Speaker 2: your perspective. 791 00:40:16,520 --> 00:40:19,920 Speaker 13: Well, I think that the the the FED is going 792 00:40:19,960 --> 00:40:22,400 Speaker 13: to be very close to adding a rate hike onto 793 00:40:22,440 --> 00:40:25,720 Speaker 13: their forecast. I don't think they're ready to hike in June. 794 00:40:25,880 --> 00:40:29,360 Speaker 13: They've kind of set us up for a for a 795 00:40:29,400 --> 00:40:33,320 Speaker 13: pause here, but there's a good chance that they bump 796 00:40:33,400 --> 00:40:36,440 Speaker 13: up their terminal rate and and you know what to 797 00:40:36,480 --> 00:40:38,520 Speaker 13: get them to stop. I mean, we need to remember 798 00:40:38,520 --> 00:40:41,640 Speaker 13: if things have to get weaker, it's the status quo 799 00:40:41,800 --> 00:40:45,399 Speaker 13: won't stop the FED. They'll slow down, and they'll hike 800 00:40:45,480 --> 00:40:47,880 Speaker 13: at alternative meetings and so on, but they're not going 801 00:40:47,960 --> 00:40:52,759 Speaker 13: to stop their raid hikes completely until they see a 802 00:40:52,800 --> 00:40:54,200 Speaker 13: real weakening of the economy. 803 00:40:54,840 --> 00:40:56,920 Speaker 11: Well, and of course we have to consider that we 804 00:40:57,000 --> 00:40:59,800 Speaker 11: have another pretty important report coming just the day before 805 00:41:00,120 --> 00:41:03,719 Speaker 11: the Fed's meeting in a couple of weeks CPI. So 806 00:41:03,800 --> 00:41:06,000 Speaker 11: could that make or break what the move is in June? 807 00:41:07,000 --> 00:41:10,200 Speaker 13: You know it could. I mean they're clearly kind of 808 00:41:10,280 --> 00:41:14,600 Speaker 13: torn here. We've had a variety of views out of speakers. 809 00:41:14,680 --> 00:41:20,560 Speaker 13: The most recent ones, including Governor Jefferson, suggested they're pretty 810 00:41:20,560 --> 00:41:23,560 Speaker 13: comfortable pausing for a while. So I think that the 811 00:41:24,080 --> 00:41:27,640 Speaker 13: burden of proof is on the Hawks to convince them 812 00:41:28,120 --> 00:41:30,719 Speaker 13: to do another hike at this meeting. But you know, 813 00:41:30,760 --> 00:41:33,879 Speaker 13: the data flow has not cooled off, and the big 814 00:41:33,960 --> 00:41:36,040 Speaker 13: risk factors that we're all looking at, you know, the 815 00:41:36,080 --> 00:41:41,480 Speaker 13: death ceiling potentially blowing up, and the banking stress and 816 00:41:41,600 --> 00:41:45,239 Speaker 13: a lot of other risk factors have faded and the 817 00:41:45,360 --> 00:41:49,759 Speaker 13: data looks solid. So yeah, it could be that that 818 00:41:49,800 --> 00:41:52,000 Speaker 13: could be you know, that could tip the balance there 819 00:41:52,000 --> 00:41:53,240 Speaker 13: if we get a strong CPI. 820 00:41:54,000 --> 00:41:55,960 Speaker 2: How what are your thoughts on the diversions between the 821 00:41:55,960 --> 00:42:00,799 Speaker 2: two surveys here Ethan, the household survey and the payrolls number. 822 00:42:00,800 --> 00:42:03,520 Speaker 2: It's something that I talked about earlier today with Heather 823 00:42:03,600 --> 00:42:07,120 Speaker 2: Bouchet from the Council of Economic Advisors at the White House. 824 00:42:07,160 --> 00:42:09,240 Speaker 2: She noted this as well, it's a great question. 825 00:42:09,320 --> 00:42:11,200 Speaker 6: When we got the data, that was one of the 826 00:42:11,200 --> 00:42:13,560 Speaker 6: first things that popped out to all of us, and like, wow, 827 00:42:13,600 --> 00:42:17,480 Speaker 6: that the bump up in the unemployment rate from three 828 00:42:17,480 --> 00:42:19,440 Speaker 6: point four to three point seven percent was a big, 829 00:42:19,640 --> 00:42:23,919 Speaker 6: a big jump, especially given what happened in the payroll data. 830 00:42:24,520 --> 00:42:27,040 Speaker 6: But here's the thing. You know, when we get the 831 00:42:27,120 --> 00:42:30,959 Speaker 6: job data, we have two different surveys, one of establishments 832 00:42:31,120 --> 00:42:34,000 Speaker 6: businesses and they tell us how many employees they have, 833 00:42:34,440 --> 00:42:37,840 Speaker 6: and then one of households, and the definition of employment 834 00:42:37,920 --> 00:42:40,080 Speaker 6: is slightly different across the two surveys. 835 00:42:40,120 --> 00:42:42,799 Speaker 2: Knowing that, though, ethan, when we see diversions like this 836 00:42:42,880 --> 00:42:46,040 Speaker 2: in the past, it sometimes signaled a shift in the 837 00:42:46,120 --> 00:42:48,919 Speaker 2: job market where one survey isn't keeping up with the other. 838 00:42:48,960 --> 00:42:51,879 Speaker 13: How do you see it, Well, I think you put 839 00:42:52,600 --> 00:42:54,680 Speaker 13: you put a lot more weight on the payroll number. 840 00:42:55,040 --> 00:42:57,640 Speaker 13: What I like to do to get rid of some 841 00:42:57,760 --> 00:43:01,200 Speaker 13: of that volatility in the host numbers, I'll take like 842 00:43:01,239 --> 00:43:04,000 Speaker 13: a three month average or a six month average and 843 00:43:04,040 --> 00:43:06,320 Speaker 13: look at it that way. Of course, that means you're 844 00:43:06,840 --> 00:43:09,520 Speaker 13: it's a bit old data when you average like that, 845 00:43:09,719 --> 00:43:13,520 Speaker 13: But if you average it out over three months, it 846 00:43:13,560 --> 00:43:16,640 Speaker 13: looks better. It's more like a two hundred thousand gain 847 00:43:16,760 --> 00:43:18,600 Speaker 13: instead of a three hundred thousand loss. 848 00:43:20,200 --> 00:43:20,480 Speaker 3: I mean. 849 00:43:20,480 --> 00:43:23,120 Speaker 13: The reality is, though, that we're even if you think 850 00:43:23,160 --> 00:43:28,120 Speaker 13: the household survey has some real merit to it, we're 851 00:43:28,200 --> 00:43:30,640 Speaker 13: just a long way from normal in the job markets. 852 00:43:30,960 --> 00:43:36,320 Speaker 13: This is job growth like this is unusual for a 853 00:43:36,440 --> 00:43:39,480 Speaker 13: mature stage of the business cycle, especially with the central 854 00:43:39,520 --> 00:43:43,680 Speaker 13: bank that's trying to get inflation under control. We're a 855 00:43:43,719 --> 00:43:48,080 Speaker 13: long way from rebalancing in the job market that will 856 00:43:48,080 --> 00:43:49,600 Speaker 13: take inflation out of the picture. 857 00:43:50,080 --> 00:43:53,000 Speaker 11: Yeah, and there's no potential default that's going to happen. 858 00:43:53,040 --> 00:43:56,880 Speaker 11: That could accelerate some real weakness in the labor market 859 00:43:56,880 --> 00:43:59,520 Speaker 11: and the US economy. Now that we have had a 860 00:43:59,560 --> 00:44:02,160 Speaker 11: bill pass both chambers of Congress, and I got to say, Ethan, 861 00:44:02,239 --> 00:44:05,480 Speaker 11: I was feeling good. Came into the office, the bill 862 00:44:05,480 --> 00:44:08,399 Speaker 11: had passed. It's Friday. The debt ceiling drama is over. 863 00:44:08,960 --> 00:44:10,879 Speaker 11: And then I get a note in my inbox from 864 00:44:10,920 --> 00:44:15,479 Speaker 11: your colleague Michael Gapin entitled Fiscal one Risk Down, one 865 00:44:15,600 --> 00:44:19,200 Speaker 11: to go, and he says, we expect budget negotiations to 866 00:44:19,239 --> 00:44:21,279 Speaker 11: be tense over the coming months and see a non 867 00:44:21,400 --> 00:44:25,759 Speaker 11: zero risk of a government shutdown come October. Yeah, talk 868 00:44:25,800 --> 00:44:29,160 Speaker 11: about a buzzkill. How worried should we be for what comes. 869 00:44:28,880 --> 00:44:31,880 Speaker 13: In the next couple I am, Yeah, Mike has no 870 00:44:32,000 --> 00:44:36,759 Speaker 13: fun at all. No, here's the way to think about this, 871 00:44:37,320 --> 00:44:40,640 Speaker 13: the debt ceiling. A death ceiling violation would be a 872 00:44:40,840 --> 00:44:45,160 Speaker 13: massive shock. If you violate the death ceiling. You are 873 00:44:46,040 --> 00:44:49,560 Speaker 13: putting under question the credit worthiness of the US government, 874 00:44:50,040 --> 00:44:53,600 Speaker 13: and you're forcing the government to balance the budget immediately, 875 00:44:54,160 --> 00:44:57,920 Speaker 13: and that means massive spending cuts. So if you go 876 00:44:58,040 --> 00:45:01,080 Speaker 13: over the debt ceiling for any standard period of time, 877 00:45:01,200 --> 00:45:05,520 Speaker 13: you will create a deep recession. So we just avoided, 878 00:45:06,280 --> 00:45:12,160 Speaker 13: you know, a really big bullet there. The failure to 879 00:45:12,200 --> 00:45:15,080 Speaker 13: pass a budget and shut down is a much smaller 880 00:45:15,320 --> 00:45:18,680 Speaker 13: problem because what they do is they keep essential parts 881 00:45:18,680 --> 00:45:22,040 Speaker 13: of government going. There's no threat to the credit worthiness 882 00:45:22,040 --> 00:45:25,000 Speaker 13: of the US government, and we know from history that 883 00:45:25,040 --> 00:45:28,400 Speaker 13: they then make up for payments later, So it's a 884 00:45:28,520 --> 00:45:31,640 Speaker 13: much smaller shock. It's something we've learned to live with, 885 00:45:32,800 --> 00:45:37,040 Speaker 13: but it does, you know, it's another sign of dysfunction 886 00:45:37,160 --> 00:45:41,439 Speaker 13: in Washington. Creates a little bit of anxiety. But yeah, 887 00:45:41,480 --> 00:45:45,320 Speaker 13: we dodged the really big one with the debt ceiling, 888 00:45:45,360 --> 00:45:48,160 Speaker 13: and these fights in the fall are much less important. 889 00:45:49,000 --> 00:45:51,520 Speaker 2: The evidence is in the markets today. Ethan Harris, great 890 00:45:51,520 --> 00:45:53,239 Speaker 2: to have you, Ethan, thanks for being with us, the 891 00:45:53,239 --> 00:45:55,920 Speaker 2: head of Global Economics at Bank of America. This is 892 00:45:55,960 --> 00:45:57,640 Speaker 2: what we promise at Bloomberg. You're not going to hear 893 00:45:57,640 --> 00:46:00,200 Speaker 2: a conversation like that anywhere else. And again of our 894 00:46:00,239 --> 00:46:04,000 Speaker 2: listeners access to someone like Ethan is pretty cool, even 895 00:46:04,120 --> 00:46:06,640 Speaker 2: if Bava brought to you a buzzco. 896 00:46:06,920 --> 00:46:09,960 Speaker 11: Yeah, you know what, it's okay, it's it's just a 897 00:46:10,000 --> 00:46:12,560 Speaker 11: reality check, and it's still is Friday, and still the 898 00:46:12,600 --> 00:46:13,880 Speaker 11: dead sealing drama kind. 899 00:46:13,760 --> 00:46:15,400 Speaker 2: Of is over All of that is still true. 900 00:46:15,480 --> 00:46:17,560 Speaker 11: All of it's still true. There's just something new to 901 00:46:17,560 --> 00:46:18,080 Speaker 11: worry about. 902 00:46:22,160 --> 00:46:24,440 Speaker 2: Thanks for listening to The Sound On podcast. Make sure 903 00:46:24,480 --> 00:46:27,320 Speaker 2: to subscribe if you haven't already, at Apple, Spotify, and 904 00:46:27,400 --> 00:46:29,959 Speaker 2: anywhere else you get your podcasts, and you can find 905 00:46:30,000 --> 00:46:33,080 Speaker 2: us live every weekday from Washington, DC at one pm 906 00:46:33,160 --> 00:46:36,760 Speaker 2: Eastern Time at Bloomberg dot com