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 00:00:15,320 --> 00:00:18,120 Speaker 2: Therefore, the Honorable Mike Johnson of the State of Louisiana, 6 00:00:18,160 --> 00:00:20,480 Speaker 2: having received a majority of the votes cast is Julie 7 00:00:20,520 --> 00:00:23,280 Speaker 2: elected Speaker of the House of Representatives for the one 8 00:00:23,360 --> 00:00:24,840 Speaker 2: hundred and eighteenth Congress. 9 00:00:26,320 --> 00:00:32,479 Speaker 3: There it is well at least half the room on 10 00:00:32,560 --> 00:00:37,199 Speaker 3: its feet, as it's made of fisher Here Republicans of 11 00:00:37,320 --> 00:00:41,680 Speaker 3: plotting following twenty two days of chaos without a Speaker 12 00:00:41,680 --> 00:00:54,279 Speaker 3: of the House. Patrick McHenry enjoying his final moments as 13 00:00:54,320 --> 00:00:58,760 Speaker 3: the keeper of the gabble in the Speaker's rostrum. Live 14 00:00:58,840 --> 00:01:01,800 Speaker 3: sound from the House floor here on Bloomberg Radio. I'm 15 00:01:01,880 --> 00:01:05,039 Speaker 3: Joe Matthew in Washington as we spend time with our 16 00:01:05,080 --> 00:01:10,320 Speaker 3: panel Jim Kessler and Lisa Camuso Miller and Bloomberg's Gregory 17 00:01:10,319 --> 00:01:13,280 Speaker 3: Cordy with me in studio here on a day that 18 00:01:13,400 --> 00:01:17,000 Speaker 3: I'm guessing tell me if I'm wrong, Gregory Mike Johnson 19 00:01:17,040 --> 00:01:20,200 Speaker 3: couldn't have imagined even last weekend. 20 00:01:20,680 --> 00:01:23,000 Speaker 4: That's exactly what I was going through my mind. And 21 00:01:23,200 --> 00:01:26,160 Speaker 4: his world's about to change. As we've said, he's now 22 00:01:26,280 --> 00:01:30,080 Speaker 4: second in line to the presidency after Vice President Kamwa Harris. 23 00:01:30,440 --> 00:01:34,440 Speaker 4: He has now instantaneously got a security detail that he 24 00:01:34,480 --> 00:01:37,160 Speaker 4: hasn't gotten before. Because he is now in that line 25 00:01:37,200 --> 00:01:39,720 Speaker 4: of succession, He's going to have to be read in 26 00:01:40,360 --> 00:01:43,200 Speaker 4: on some of the nation's most sensitive secrets. Things he's 27 00:01:43,240 --> 00:01:46,320 Speaker 4: never heard before. Things he's never heard before, the things 28 00:01:46,319 --> 00:01:49,320 Speaker 4: that he needs to know. Frankly, he is on the 29 00:01:49,400 --> 00:01:53,960 Speaker 4: Armed Services Committee, but doesn't have particular background in intelligence 30 00:01:54,640 --> 00:01:58,360 Speaker 4: in foreign affairs, so he will have to get up 31 00:01:58,360 --> 00:02:01,240 Speaker 4: to speed on that we've been talking about. He's got 32 00:02:01,280 --> 00:02:05,280 Speaker 4: to bring not only a fractured Republican conference together, but 33 00:02:05,360 --> 00:02:07,920 Speaker 4: now he's got to reach out to Hakeem Jeffries, the 34 00:02:07,960 --> 00:02:10,320 Speaker 4: Minority Leader. He's got to reach out to the Senate, 35 00:02:10,760 --> 00:02:14,680 Speaker 4: Mitch McConnell, and Chuck Schumer in the Senate. He's part 36 00:02:14,720 --> 00:02:18,120 Speaker 4: of that gang of foreign now, and at some point 37 00:02:18,160 --> 00:02:20,840 Speaker 4: he's going to pick up I would expect Joe Biden 38 00:02:20,919 --> 00:02:23,880 Speaker 4: may already be lining up that phone call. That's one 39 00:02:23,880 --> 00:02:26,240 Speaker 4: thing that we know that President Biden is very good 40 00:02:26,280 --> 00:02:28,399 Speaker 4: about is making these sort of congratuatory calls. I would 41 00:02:28,400 --> 00:02:30,400 Speaker 4: expect that to happen before the afternoon is over, to 42 00:02:30,440 --> 00:02:33,520 Speaker 4: introduce each other. And yeah, so this is now a 43 00:02:33,560 --> 00:02:36,600 Speaker 4: guy that none of us knew much about just a 44 00:02:36,639 --> 00:02:39,840 Speaker 4: couple of days ago, maybe even until last night, that 45 00:02:40,240 --> 00:02:43,000 Speaker 4: now is going to be part of the regular conversation 46 00:02:43,160 --> 00:02:43,679 Speaker 4: Washington d C. 47 00:02:43,919 --> 00:02:46,799 Speaker 3: Incredible stuff. Lisa, you mentioned having worked for the speaker. 48 00:02:46,840 --> 00:02:49,480 Speaker 3: You've got a staff of about thirty five. When does 49 00:02:49,520 --> 00:02:50,320 Speaker 3: the hiring begin? 50 00:02:52,080 --> 00:02:55,080 Speaker 5: Almost immediately. But the good news is that there's lots 51 00:02:55,120 --> 00:02:57,359 Speaker 5: of really talented people on Capitol Hill that know how 52 00:02:57,400 --> 00:03:00,280 Speaker 5: this works and know how the process comes to other 53 00:03:00,600 --> 00:03:02,680 Speaker 5: And the great news for the new Speaker is that 54 00:03:02,680 --> 00:03:05,680 Speaker 5: that those people are available and willing to help it 55 00:03:05,720 --> 00:03:09,040 Speaker 5: make him be successful. And so that alone gives a 56 00:03:09,040 --> 00:03:11,480 Speaker 5: lot of confidence to something someone like him, to know 57 00:03:11,520 --> 00:03:14,880 Speaker 5: that there are great, talented people on the leadership staff 58 00:03:14,880 --> 00:03:16,720 Speaker 5: that already can be very supportive to him. He's going 59 00:03:16,800 --> 00:03:19,040 Speaker 5: to have a seamless transition. That's the one thing I 60 00:03:19,120 --> 00:03:21,200 Speaker 5: can be certain of because I know how talented those 61 00:03:21,240 --> 00:03:23,600 Speaker 5: people are. They are the unsung heroes of the last 62 00:03:23,600 --> 00:03:26,200 Speaker 5: three weeks that have been working day and night to 63 00:03:26,240 --> 00:03:29,639 Speaker 5: make sure that this thing happened unsuccessfully a few times over. 64 00:03:29,720 --> 00:03:32,520 Speaker 5: But it'll be interesting and I think it'll be a 65 00:03:32,560 --> 00:03:35,400 Speaker 5: positive direction for the House going forward. 66 00:03:36,760 --> 00:03:39,240 Speaker 3: Him, Speaker Johnson is going to have to work with 67 00:03:39,680 --> 00:03:42,040 Speaker 3: the leader next door, that would be your former boss, 68 00:03:42,120 --> 00:03:44,080 Speaker 3: Chuck Schumer. How soon do these two get together? 69 00:03:46,360 --> 00:03:51,200 Speaker 6: I imagine it's going to happen very quickly, and there's 70 00:03:51,280 --> 00:03:54,760 Speaker 6: some serious work that needs to be done. And you know, 71 00:03:54,840 --> 00:03:59,920 Speaker 6: as we remarked on earlier, Leader McConnell and Leader Schumer, 72 00:04:00,040 --> 00:04:04,320 Speaker 6: y're roughly the same place, same with Jefferies, same with Biden. 73 00:04:04,480 --> 00:04:08,280 Speaker 6: So in some ways it's four against one here. And 74 00:04:08,640 --> 00:04:11,560 Speaker 6: you know, I think Mike Johnson's going to have to 75 00:04:11,560 --> 00:04:15,840 Speaker 6: figure out a way to get his you know what 76 00:04:15,960 --> 00:04:20,400 Speaker 6: he needs out of this, but also move these just 77 00:04:20,839 --> 00:04:25,279 Speaker 6: critical spending bills and pieces of legislation forward at this 78 00:04:25,880 --> 00:04:29,880 Speaker 6: remarkably critical time in the world right now. 79 00:04:32,960 --> 00:04:37,480 Speaker 3: All right, many thanks to our panel for a marathon 80 00:04:37,600 --> 00:04:41,960 Speaker 3: session here. Jim Kessler at Third Way, Lisa Camusa Miller 81 00:04:42,000 --> 00:04:45,919 Speaker 3: at RESET Public Affairs, many thanks for your insights and 82 00:04:45,960 --> 00:04:48,279 Speaker 3: bringing your experience to us here. They're good friends of 83 00:04:48,320 --> 00:04:50,039 Speaker 3: the program and awfully glad that you could be with 84 00:04:50,120 --> 00:04:53,080 Speaker 3: us through this. Who knew starting an hour ago that 85 00:04:53,120 --> 00:04:56,240 Speaker 3: we would experience all of this together, Lisa and Jim, 86 00:04:56,839 --> 00:05:00,000 Speaker 3: many thanks to you and Gregory Cordy. We talk about 87 00:05:00,240 --> 00:05:02,440 Speaker 3: hiring up here, setting up the office. Then is the 88 00:05:02,480 --> 00:05:05,200 Speaker 3: matter of actual business. What's going to be the priority 89 00:05:05,240 --> 00:05:08,919 Speaker 3: a continuing resolution or the supplemental funding for Israel and Ukraine. 90 00:05:09,400 --> 00:05:11,920 Speaker 4: Well, I mean one thing even before that is the 91 00:05:11,960 --> 00:05:14,520 Speaker 4: clock starts ticking right now of forty eight hours on 92 00:05:14,560 --> 00:05:18,599 Speaker 4: a privileged resolution to expel George Santos, one of the 93 00:05:18,600 --> 00:05:21,919 Speaker 4: low thorns in the side of the past African business. 94 00:05:22,160 --> 00:05:26,159 Speaker 4: It actually is under house rules, it's privileged, so it 95 00:05:26,240 --> 00:05:27,760 Speaker 4: has to come to a vote at the time of 96 00:05:27,760 --> 00:05:30,400 Speaker 4: a speaker's choosing, now that we have a speaker, but 97 00:05:30,520 --> 00:05:32,720 Speaker 4: within the next forty eight hours, and of course you 98 00:05:32,800 --> 00:05:35,039 Speaker 4: know this was a difficult problem for Kevin McCarthy because 99 00:05:35,040 --> 00:05:37,800 Speaker 4: he relied on George Santos's vote, but his is a 100 00:05:37,800 --> 00:05:40,640 Speaker 4: congressman from New York who's under indictment. We all know 101 00:05:40,720 --> 00:05:42,800 Speaker 4: this saga, right, This is another one of the soap 102 00:05:42,839 --> 00:05:45,800 Speaker 4: operas that we've had in this year in Congress. So 103 00:05:45,839 --> 00:05:48,320 Speaker 4: that's actually one of the first orders of business. Then 104 00:05:48,320 --> 00:05:51,200 Speaker 4: we have a little bit of time until the middle 105 00:05:51,200 --> 00:05:53,680 Speaker 4: of next month to pass a spending bill. So I 106 00:05:53,680 --> 00:05:57,159 Speaker 4: would have to think that the supplemental for Israel and 107 00:05:57,279 --> 00:06:02,840 Speaker 4: Ukraine takes top priority. But that's also politically tricky through 108 00:06:02,880 --> 00:06:05,440 Speaker 4: those advanced as one bill, as the President certainly would like, 109 00:06:05,880 --> 00:06:08,719 Speaker 4: because the support for Israel is a lot more popular 110 00:06:08,720 --> 00:06:10,880 Speaker 4: than support for Ukraine, and maybe UKRAINI can come along 111 00:06:10,920 --> 00:06:13,400 Speaker 4: for the ride. But that's one of the issues that 112 00:06:13,520 --> 00:06:17,240 Speaker 4: was forcing this chaos in the Republican conference is where 113 00:06:17,240 --> 00:06:20,400 Speaker 4: these speaker candidates were on that question was a decisive 114 00:06:20,880 --> 00:06:23,839 Speaker 4: factor that may have killed some of these previous speaker candidates. 115 00:06:24,800 --> 00:06:26,960 Speaker 3: Gregory many thanks for being with us here in the 116 00:06:27,000 --> 00:06:29,279 Speaker 3: clutch as always, Gregory Cordy, great to have you, Bloomberg 117 00:06:29,360 --> 00:06:32,240 Speaker 3: Politics reporter, I'm Joe Matthew and Washington as we bring 118 00:06:32,279 --> 00:06:33,840 Speaker 3: you live to the capital once again. 119 00:06:33,880 --> 00:06:34,000 Speaker 1: Here. 120 00:06:34,040 --> 00:06:36,279 Speaker 3: If you're with us on YouTube, you've been seeing the 121 00:06:36,320 --> 00:06:40,120 Speaker 3: House floor, Let's go outdoors now. Bloomberg's Kaylee Lines is 122 00:06:40,320 --> 00:06:43,040 Speaker 3: just outside the chamber and I suspect we'll be talking 123 00:06:43,080 --> 00:06:45,719 Speaker 3: to a lot of lawmakers in just a matter of moments. 124 00:06:45,720 --> 00:06:48,520 Speaker 3: But she's ours first, right now, Kaylee, what's the vibe 125 00:06:48,560 --> 00:06:49,960 Speaker 3: out there now that this is official. 126 00:06:52,360 --> 00:06:54,680 Speaker 7: Well, there's definitely a sense of relief, especially for all 127 00:06:54,680 --> 00:06:56,440 Speaker 7: the reporters out here with me who have been at 128 00:06:56,440 --> 00:06:58,640 Speaker 7: this now for weeks, Joe out here each and every 129 00:06:58,680 --> 00:07:00,280 Speaker 7: day trying to figure out who the next Seaker of 130 00:07:00,320 --> 00:07:01,719 Speaker 7: the House will be. But of course now we know 131 00:07:01,960 --> 00:07:04,320 Speaker 7: it's Mike Johnson. We actually are expecting that he may 132 00:07:04,360 --> 00:07:06,640 Speaker 7: speak to press later on. They're setting up a press 133 00:07:06,640 --> 00:07:09,800 Speaker 7: conference just behind me, so we'll hear from the now 134 00:07:09,840 --> 00:07:12,920 Speaker 7: speaker himself shortly. But I would imagine and as we 135 00:07:12,960 --> 00:07:15,120 Speaker 7: wait for more lawmakers to come down the steps, that 136 00:07:15,160 --> 00:07:16,800 Speaker 7: there is going to be a bit of a sigh 137 00:07:16,840 --> 00:07:19,160 Speaker 7: of relief that this battle is actually over. The House 138 00:07:19,200 --> 00:07:21,240 Speaker 7: has a speaker and they can get back to the 139 00:07:21,280 --> 00:07:22,560 Speaker 7: business of legislating. 140 00:07:24,280 --> 00:07:26,840 Speaker 3: Well, that's right to your point, though, we have to 141 00:07:26,880 --> 00:07:30,320 Speaker 3: go through a few stages before we get to actual governance, 142 00:07:30,320 --> 00:07:33,880 Speaker 3: and that includes delivering a message. This is going to 143 00:07:33,880 --> 00:07:36,120 Speaker 3: be an outdoor news conference, Kaylee. Will there be a 144 00:07:36,120 --> 00:07:38,760 Speaker 3: big crowd, will he have the conference behind him or 145 00:07:38,800 --> 00:07:40,920 Speaker 3: do we have yet to learn all of these things. 146 00:07:42,880 --> 00:07:44,720 Speaker 7: We have yet to learn exactly who's going to be 147 00:07:44,720 --> 00:07:45,920 Speaker 7: in front of the mics. What I can tell you 148 00:07:46,000 --> 00:07:48,480 Speaker 7: is behind the mics, there is a lot of TV cameras, 149 00:07:48,480 --> 00:07:50,880 Speaker 7: there's ropes going up, there are reporters crawling all around 150 00:07:50,920 --> 00:07:53,840 Speaker 7: here getting ready to ask questions of now Speaker Johnson. 151 00:07:53,880 --> 00:07:55,760 Speaker 7: So I would imagine the crowd is going to be 152 00:07:55,840 --> 00:07:57,720 Speaker 7: pretty big, as this is a historic day. The fifty 153 00:07:57,720 --> 00:07:59,800 Speaker 7: six Speaker of the House has been elected after twenty 154 00:07:59,840 --> 00:08:02,680 Speaker 7: more more than three weeks without one, and there's going 155 00:08:02,720 --> 00:08:05,040 Speaker 7: to be some pretty pressing questions for him, given as 156 00:08:05,080 --> 00:08:07,720 Speaker 7: you were just discussing, until about twenty four hours ago, 157 00:08:07,760 --> 00:08:09,760 Speaker 7: a lot of people didn't even know who Mike Johnson was, 158 00:08:09,800 --> 00:08:11,880 Speaker 7: and now the policy he wants to push forward is 159 00:08:11,920 --> 00:08:14,040 Speaker 7: really going to matter, not just for what happens here 160 00:08:14,040 --> 00:08:16,080 Speaker 7: in Capitol Hill, but for the country as a whole. 161 00:08:17,320 --> 00:08:20,240 Speaker 3: This is great behind the scenes stuff here, especially if 162 00:08:20,240 --> 00:08:23,400 Speaker 3: you're with us on YouTube. Go there now, search Bloomberg 163 00:08:23,440 --> 00:08:26,240 Speaker 3: Global News and check this out. You'll see Kaylee outdoors. 164 00:08:26,520 --> 00:08:30,320 Speaker 3: I'm also hearing producers counting down on their live shots 165 00:08:30,400 --> 00:08:33,120 Speaker 3: next to you, Kaylee. And this is the way it works. 166 00:08:33,160 --> 00:08:35,200 Speaker 3: You can feel free to turn the camra tell us 167 00:08:35,200 --> 00:08:37,720 Speaker 3: what's happening here because this is the gathering, the spontaneous 168 00:08:37,720 --> 00:08:40,599 Speaker 3: gathering of reporters who come out of the trees practically 169 00:08:40,760 --> 00:08:41,640 Speaker 3: for an event like this. 170 00:08:43,600 --> 00:08:43,800 Speaker 6: Yeah. 171 00:08:43,880 --> 00:08:46,360 Speaker 7: Well, actually, just to my right, Joe, Congressman Bob Good 172 00:08:46,360 --> 00:08:49,040 Speaker 7: of Virginia is huddling with a few of my colleagues. Here. 173 00:08:49,080 --> 00:08:51,320 Speaker 7: There's other ropes going on around me, so I'm afraid 174 00:08:51,360 --> 00:08:53,880 Speaker 7: I might get moved here in a second. They're trying 175 00:08:53,880 --> 00:08:56,600 Speaker 7: to establish a perimeter essentially just in front of the steps, 176 00:08:56,600 --> 00:08:58,439 Speaker 7: to clear the way for where the podium is, where 177 00:08:58,440 --> 00:09:01,280 Speaker 7: the speaker. Now speaker is assumed to be talking, and 178 00:09:01,320 --> 00:09:03,839 Speaker 7: they're making gestures. So I'm just going to slowly start 179 00:09:03,840 --> 00:09:05,040 Speaker 7: shifting to the side. 180 00:09:05,840 --> 00:09:06,760 Speaker 3: Please, don't get a rest. 181 00:09:07,720 --> 00:09:10,000 Speaker 7: You can see the road. Glad I moved, Yes. 182 00:09:10,440 --> 00:09:12,920 Speaker 3: Look at that. This is the real stuff. You won't 183 00:09:12,960 --> 00:09:16,160 Speaker 3: see that on the cable news networks, you know, Kaylee, 184 00:09:16,160 --> 00:09:18,040 Speaker 3: I suspect that staircase is going to be full of 185 00:09:18,080 --> 00:09:20,240 Speaker 3: lawmakers in a bit. Do you have an ETA on 186 00:09:20,320 --> 00:09:21,079 Speaker 3: the news conference? 187 00:09:23,720 --> 00:09:25,800 Speaker 7: It should be beginning shortly now that the vote has 188 00:09:25,840 --> 00:09:28,880 Speaker 7: finally wrapped up. Once everything is gabbled and complete in there, 189 00:09:29,400 --> 00:09:32,280 Speaker 7: we'll see how quickly around they will turn this around 190 00:09:32,280 --> 00:09:35,120 Speaker 7: and actually bring them outside, and whether or not other 191 00:09:35,160 --> 00:09:37,160 Speaker 7: members will be descending down the steps on their owner. 192 00:09:37,200 --> 00:09:39,400 Speaker 7: If everyone's going to come out together as a conference, 193 00:09:39,440 --> 00:09:41,679 Speaker 7: We're all staying tuned for that. Joe and I apologize 194 00:09:41,679 --> 00:09:43,920 Speaker 7: for the taping sound. There's a lot of chords and 195 00:09:44,160 --> 00:09:46,800 Speaker 7: plugs that know it to effort like this one. 196 00:09:47,480 --> 00:09:51,200 Speaker 3: Yeah, I'll let you leave this awkward situation, Kayley. Thank 197 00:09:51,240 --> 00:09:53,720 Speaker 3: you for showing that too us. This is absolutely fascinating. 198 00:09:54,000 --> 00:09:56,000 Speaker 3: You know, look, it's your backyard, but not everybody gets 199 00:09:56,040 --> 00:09:57,839 Speaker 3: to see this every day. Just think of like these 200 00:09:57,840 --> 00:09:59,640 Speaker 3: guys are going to be friends for life, these reporters 201 00:09:59,679 --> 00:10:01,600 Speaker 3: who've been there for twenty two days, that Kaye will 202 00:10:01,600 --> 00:10:03,720 Speaker 3: have to introduce me at some point to everyone she's met. 203 00:10:03,800 --> 00:10:05,400 Speaker 3: Thank you, Kaylee. I'll see you back here in the 204 00:10:05,400 --> 00:10:07,880 Speaker 3: Bureau for Balance of Power a bit later on, and 205 00:10:07,920 --> 00:10:09,600 Speaker 3: of course Kaylee will bring us some of the sites 206 00:10:09,640 --> 00:10:13,240 Speaker 3: and sounds of what's about to happen on Capitol Hill. 207 00:10:13,640 --> 00:10:18,079 Speaker 3: What a moment to have Libby Kantrill, the head of 208 00:10:18,200 --> 00:10:20,600 Speaker 3: US Public Policy at PIMC. We've been talking about this 209 00:10:21,120 --> 00:10:23,160 Speaker 3: for twenty two days and she's with us. 210 00:10:23,200 --> 00:10:23,520 Speaker 1: Now. 211 00:10:23,800 --> 00:10:26,320 Speaker 3: Your timing as usual is impeccable, Libby, we have a 212 00:10:26,400 --> 00:10:29,520 Speaker 3: fifty sixth Speaker of the House. I don't even know 213 00:10:29,559 --> 00:10:33,080 Speaker 3: what to ask you. First, Is the market signing a 214 00:10:33,080 --> 00:10:33,920 Speaker 3: bit of relief for me? 215 00:10:34,720 --> 00:10:38,760 Speaker 8: I mean, at long last, right, even I think the 216 00:10:38,800 --> 00:10:42,760 Speaker 8: markets haven't really been so focused on this, obviously, and 217 00:10:42,880 --> 00:10:47,040 Speaker 8: this sort collided with a lot of other geopolitical and 218 00:10:47,120 --> 00:10:50,920 Speaker 8: other issues happening, particularly in the US treasury market, So 219 00:10:50,920 --> 00:10:53,280 Speaker 8: I don't think the markets have really been paying all 220 00:10:53,320 --> 00:10:57,000 Speaker 8: that much attention to it. However, as as we all know, 221 00:10:57,120 --> 00:10:58,400 Speaker 8: not to kind of nerd out here a little bit, 222 00:10:58,440 --> 00:11:00,760 Speaker 8: but we all know that the term premium in the 223 00:11:00,880 --> 00:11:04,360 Speaker 8: US yield curve treasuries have backed up, and that sort 224 00:11:04,360 --> 00:11:07,400 Speaker 8: of elusive term premium can include a lot of things, 225 00:11:08,000 --> 00:11:11,280 Speaker 8: including just concerns about the governance of the United States, 226 00:11:11,320 --> 00:11:13,520 Speaker 8: And so you know, you could argue that some of 227 00:11:13,520 --> 00:11:16,360 Speaker 8: the backup and treasury yields that we've seen is at 228 00:11:16,440 --> 00:11:19,000 Speaker 8: least in part due to these concerns about just the 229 00:11:19,040 --> 00:11:22,840 Speaker 8: ability of Washington to function. So I guess in that respect, 230 00:11:22,960 --> 00:11:26,400 Speaker 8: you would think that yes, the markets would likely breathe 231 00:11:26,520 --> 00:11:27,559 Speaker 8: a sigh of relief. 232 00:11:28,120 --> 00:11:28,920 Speaker 9: We can get into it. 233 00:11:28,960 --> 00:11:32,520 Speaker 8: But there's also maybe some clarity around how we move 234 00:11:32,559 --> 00:11:34,720 Speaker 8: forward on the government funding question as well. 235 00:11:36,200 --> 00:11:38,440 Speaker 3: Okay, well, what do you think about that? Because Mike 236 00:11:38,520 --> 00:11:42,600 Speaker 3: Johnson says he's willing to grab that third rail called 237 00:11:42,600 --> 00:11:44,760 Speaker 3: a continuing resolution, and it doesn't seem to be a 238 00:11:44,800 --> 00:11:47,800 Speaker 3: problem for the Conference the way it was for Kevin McCarthy. 239 00:11:47,840 --> 00:11:48,680 Speaker 3: Can he actually do this? 240 00:11:49,720 --> 00:11:51,880 Speaker 8: And this is the great irony, of course, is that 241 00:11:51,960 --> 00:11:56,319 Speaker 8: what got former Speaker McCarthy ousted was working with Democrats 242 00:11:56,320 --> 00:11:59,480 Speaker 8: to pass that short term staff gap funding bill. And 243 00:11:59,559 --> 00:12:05,839 Speaker 8: yet now I guess Speaker elect Johnson has indicated that's 244 00:12:05,880 --> 00:12:08,360 Speaker 8: exactly what he will do as well, in order to 245 00:12:08,400 --> 00:12:12,160 Speaker 8: buy more time. Now, ironically or maybe interestingly, he did 246 00:12:12,160 --> 00:12:16,680 Speaker 8: not representive Johnson did not vote for that stop gap 247 00:12:16,800 --> 00:12:20,560 Speaker 8: bill back in late September, But to your point, he 248 00:12:20,720 --> 00:12:27,240 Speaker 8: has indicated that he does plan on passing a stop 249 00:12:27,280 --> 00:12:30,520 Speaker 8: gap again to buy more time for the House to 250 00:12:30,640 --> 00:12:34,560 Speaker 8: pass those single subject appropriations bills, which I think is 251 00:12:34,559 --> 00:12:36,680 Speaker 8: sort of a distinction without a difference for many people, 252 00:12:36,720 --> 00:12:40,080 Speaker 8: for most people and the markets, but for many members 253 00:12:40,120 --> 00:12:42,680 Speaker 8: of Congress, particularly among the House Freedom co because that 254 00:12:42,720 --> 00:12:46,920 Speaker 8: has been really a decisive issue for them. They have 255 00:12:47,040 --> 00:12:51,360 Speaker 8: wanted to tackle appropriations, spending bills one at a time 256 00:12:51,840 --> 00:12:55,320 Speaker 8: versus what is usual at the minibus are omnibus where 257 00:12:55,400 --> 00:12:58,280 Speaker 8: bills are all sort of stuck together and passed at 258 00:12:58,320 --> 00:12:59,199 Speaker 8: the eleventh hour. 259 00:12:59,320 --> 00:13:00,400 Speaker 9: So you know, we'll. 260 00:13:00,280 --> 00:13:05,320 Speaker 8: See you know again. His sort of fiscal record is 261 00:13:05,480 --> 00:13:10,720 Speaker 8: one more of austerity. He has advocated for spending cuts 262 00:13:10,720 --> 00:13:14,120 Speaker 8: in many different respects, and again he voted for a 263 00:13:14,240 --> 00:13:17,439 Speaker 8: voted against that funding bill. He's voted against Ukraine funding 264 00:13:18,080 --> 00:13:21,840 Speaker 8: several times as well. So this may not be a 265 00:13:21,920 --> 00:13:25,520 Speaker 8: totally smooth glide path, but at least as of now, 266 00:13:25,600 --> 00:13:28,000 Speaker 8: he is indicating that he will move forward in a 267 00:13:28,000 --> 00:13:30,679 Speaker 8: way that certainly the markets will will appreciate. 268 00:13:32,720 --> 00:13:35,600 Speaker 3: The President of the United States is speaking right now 269 00:13:35,600 --> 00:13:38,280 Speaker 3: along with the Prime Minister of Australia on the other 270 00:13:38,360 --> 00:13:41,360 Speaker 3: end of Pennsylvania Avenue. They're holding a bilateral news conference 271 00:13:42,040 --> 00:13:44,400 Speaker 3: that was set to start almost an hour ago. At 272 00:13:44,440 --> 00:13:46,520 Speaker 3: this point, Libby, do you want to hear him address 273 00:13:47,120 --> 00:13:49,240 Speaker 3: any of these issues? What does the market want to 274 00:13:49,240 --> 00:13:51,760 Speaker 3: hear him say about a continuing resolution and about the 275 00:13:51,800 --> 00:13:53,080 Speaker 3: supplemental budget request? 276 00:13:53,760 --> 00:13:55,760 Speaker 8: Oh about the President saying yeah, I mean, of course, 277 00:13:55,840 --> 00:13:57,599 Speaker 8: you know, I think what the market's going to be 278 00:13:57,640 --> 00:14:01,160 Speaker 8: more in tune to in terms of this meeting, you know, 279 00:14:01,200 --> 00:14:04,480 Speaker 8: with one of our closest allies is probably around the 280 00:14:04,559 --> 00:14:09,160 Speaker 8: question of China and sort of how we move forward together, 281 00:14:09,400 --> 00:14:12,440 Speaker 8: you know, with Australia on that issue. You know, I 282 00:14:12,440 --> 00:14:14,839 Speaker 8: think that the President has been very clear that he 283 00:14:15,440 --> 00:14:18,480 Speaker 8: wants to avoid a government shutdown, that he will work 284 00:14:18,520 --> 00:14:23,200 Speaker 8: with anybody who is in leadership to that end. Now, 285 00:14:23,240 --> 00:14:25,960 Speaker 8: of course, this is a bit of an interesting dynamic 286 00:14:26,120 --> 00:14:29,560 Speaker 8: because the speakerl Lot Johnson, you did not vote to 287 00:14:29,600 --> 00:14:33,240 Speaker 8: certify the twenty twenty election, so you know right off 288 00:14:33,320 --> 00:14:36,480 Speaker 8: that that maybe puts things on a bit of an 289 00:14:36,520 --> 00:14:39,080 Speaker 8: awkward foot. But you know, Biden is sort of a 290 00:14:39,120 --> 00:14:42,400 Speaker 8: constant legislator at heart, and I think he will work 291 00:14:42,400 --> 00:14:44,680 Speaker 8: with whomever he needs to work with you to get 292 00:14:44,680 --> 00:14:47,000 Speaker 8: things to get things done, at least at least that's 293 00:14:47,000 --> 00:14:49,000 Speaker 8: what people say, most likely. 294 00:14:50,840 --> 00:14:54,560 Speaker 3: Spending time with Libby Cantrell, head of public policy at PIMCO, 295 00:14:54,760 --> 00:14:57,880 Speaker 3: with a Speaker of the House. It is actually official now, 296 00:14:57,920 --> 00:15:02,000 Speaker 3: Mike Johnson voted to be the fifty sixth Speaker a 297 00:15:02,040 --> 00:15:06,040 Speaker 3: short time ago in the House of Representatives. 298 00:15:06,240 --> 00:15:08,400 Speaker 2: In their tallies that the total number of votes cast 299 00:15:08,520 --> 00:15:12,040 Speaker 2: is four hundred and twenty nine, of which the Honorable 300 00:15:12,080 --> 00:15:15,120 Speaker 2: Mike Johnson of the State of Louisiana has received two 301 00:15:15,200 --> 00:15:42,360 Speaker 2: hundred and twenty votes, and the Honorable Hakeem Jeffries of 302 00:15:42,400 --> 00:15:44,440 Speaker 2: the State of New York has received two hundred and 303 00:15:44,520 --> 00:15:59,320 Speaker 2: nine votes. Therefore, the Honorable Mike Johnson of the State 304 00:15:59,320 --> 00:16:01,840 Speaker 2: of Louisiana having received a majority of the votes cast 305 00:16:01,880 --> 00:16:04,840 Speaker 2: as Julie elected Speaker of the House of Representatives for 306 00:16:04,960 --> 00:16:06,760 Speaker 2: the one hundred and eighteenth Congress. 307 00:16:09,240 --> 00:16:11,640 Speaker 3: Yes, indeed, Patrick McHenry, don't be confused by what you're 308 00:16:11,640 --> 00:16:13,840 Speaker 3: seeing on YouTube that took place a short time ago, 309 00:16:13,880 --> 00:16:17,240 Speaker 3: making it all official. Hackem Jeffries, the minority leader and 310 00:16:17,480 --> 00:16:22,120 Speaker 3: obviously Speaker Johnson now official. Libby, how important will it 311 00:16:22,160 --> 00:16:26,240 Speaker 3: be for these two Jeffries and Johnson to show a 312 00:16:26,360 --> 00:16:28,320 Speaker 3: united front or are we beyond that? 313 00:16:28,400 --> 00:16:29,080 Speaker 1: In Washington? 314 00:16:31,040 --> 00:16:33,560 Speaker 8: Well, I will just say that the Republicans seemed happy 315 00:16:33,960 --> 00:16:36,840 Speaker 8: that they finally got to that threshold. I will just 316 00:16:36,880 --> 00:16:39,480 Speaker 8: take you to commenting on that that latest clip that 317 00:16:39,520 --> 00:16:42,880 Speaker 8: you played, they are I think that folks were exhausted 318 00:16:42,920 --> 00:16:45,160 Speaker 8: and they were frustrated, and they just wanted to move forward. 319 00:16:45,240 --> 00:16:48,400 Speaker 8: And that's one of the reasons why you Representative Johnson, 320 00:16:48,400 --> 00:16:51,320 Speaker 8: who most people don't know. I mean many people on 321 00:16:51,360 --> 00:16:53,960 Speaker 8: the Hill don't know him very well, but certainly kind 322 00:16:53,960 --> 00:16:57,080 Speaker 8: of nationally, he doesn't have the same profile that certainly 323 00:16:57,120 --> 00:17:00,680 Speaker 8: former Speaker McCarthy or Pelosi and Pelosi had Joe. In 324 00:17:00,760 --> 00:17:03,240 Speaker 8: terms of your question about how important it is for 325 00:17:03,400 --> 00:17:05,920 Speaker 8: the two of them to work together, I mean, clearly, 326 00:17:06,080 --> 00:17:10,600 Speaker 8: you you know, it's important to have a working, constructive 327 00:17:10,680 --> 00:17:15,440 Speaker 8: relationship with folks across the aisle. Johnson doesn't really he 328 00:17:15,800 --> 00:17:18,560 Speaker 8: just hasn't been sort of in the leadership mix, so 329 00:17:18,600 --> 00:17:21,800 Speaker 8: it's difficult to sort of assess at this point kind 330 00:17:21,800 --> 00:17:25,199 Speaker 8: of what his approach will be working with Democrats. But 331 00:17:25,320 --> 00:17:28,120 Speaker 8: as we have seen kind of painfully over the last 332 00:17:28,119 --> 00:17:31,919 Speaker 8: few weeks, for many things, Republicans will need and Speaker 333 00:17:32,000 --> 00:17:36,960 Speaker 8: Johnson or througher elect Johnson will need Democrats to to 334 00:17:36,960 --> 00:17:39,880 Speaker 8: to pass things and to advance, you know, the entire 335 00:17:39,960 --> 00:17:43,560 Speaker 8: kind of Nations agenda, So it is important. I do 336 00:17:43,720 --> 00:17:46,720 Speaker 8: think there is you know, poisoning of the well here, however, 337 00:17:47,440 --> 00:17:49,199 Speaker 8: but you know, I think that they will both be 338 00:17:49,240 --> 00:17:51,080 Speaker 8: side we'll try to kind of move forward. I do 339 00:17:51,119 --> 00:17:54,040 Speaker 8: think there is a Republicans or of the sense of 340 00:17:54,119 --> 00:17:57,680 Speaker 8: urgency among Republicans to sort of move forward, focus on legislating, 341 00:17:58,000 --> 00:17:59,840 Speaker 8: focus on kind of the business of the day, and 342 00:18:00,080 --> 00:18:02,360 Speaker 8: try to put this as far in the rear view 343 00:18:02,359 --> 00:18:05,119 Speaker 8: mirror as possible. And of course we won't know what 344 00:18:05,160 --> 00:18:09,200 Speaker 8: the political implications of all of this is until next November. 345 00:18:11,000 --> 00:18:14,520 Speaker 3: Do you have a sense that this is a speaker 346 00:18:14,560 --> 00:18:17,080 Speaker 3: who can finish the job or would suffer potentially the 347 00:18:17,080 --> 00:18:18,480 Speaker 3: same fate as Kevin McCarthy. 348 00:18:18,640 --> 00:18:20,680 Speaker 9: I do not want to even imagine that we would 349 00:18:20,760 --> 00:18:23,560 Speaker 9: be back here again. I think that they want, folks. 350 00:18:24,280 --> 00:18:25,119 Speaker 9: I'm sure you don't. 351 00:18:25,200 --> 00:18:26,760 Speaker 8: I mean, this is you know, there are other things 352 00:18:26,760 --> 00:18:28,520 Speaker 8: happening in the world, and this is not something that 353 00:18:28,520 --> 00:18:32,040 Speaker 8: we've we've all been consumed with this, you know, so regrettably. 354 00:18:32,119 --> 00:18:34,400 Speaker 8: But you know, I think that they I think folks 355 00:18:34,440 --> 00:18:37,560 Speaker 8: will be incredibly reticent to use this the motion to 356 00:18:37,640 --> 00:18:41,320 Speaker 8: maake it again in this session of Congress. Now, Joe, 357 00:18:41,359 --> 00:18:43,840 Speaker 8: as you as you well know, though, there's just not 358 00:18:44,040 --> 00:18:47,919 Speaker 8: that much time left in this Congress because practically in 359 00:18:47,960 --> 00:18:51,680 Speaker 8: an election year, you know, most both sides usually try 360 00:18:51,680 --> 00:18:54,439 Speaker 8: to send their members home by kind of Midsummer to 361 00:18:54,480 --> 00:18:57,600 Speaker 8: start campaigning and then only bring them back in the 362 00:18:57,640 --> 00:18:58,439 Speaker 8: fall for kind. 363 00:18:58,280 --> 00:18:59,560 Speaker 9: Of muth pass issues. 364 00:18:59,680 --> 00:19:02,080 Speaker 8: So the sort of idea that this might be a 365 00:19:02,160 --> 00:19:06,280 Speaker 8: really productive Congress of legislating, which I don't think we 366 00:19:06,359 --> 00:19:09,199 Speaker 8: really had anyway, but certainly we don't have that now, 367 00:19:09,240 --> 00:19:12,439 Speaker 8: just because we haven't even passed you know, funding bills. 368 00:19:12,520 --> 00:19:15,240 Speaker 9: There's the you know, the farm bill, there's the NDAA. 369 00:19:16,200 --> 00:19:19,000 Speaker 8: Then of course there's Ukraine and Israel funding as well, 370 00:19:19,080 --> 00:19:21,920 Speaker 8: so they have a lot on their plate, and I 371 00:19:21,960 --> 00:19:24,600 Speaker 8: would assume that, you know, not much more than kind 372 00:19:24,600 --> 00:19:27,199 Speaker 8: of the bare minimum gets done gets done this Congress. 373 00:19:27,200 --> 00:19:28,959 Speaker 8: The last thing I will say, which I think has 374 00:19:29,000 --> 00:19:31,359 Speaker 8: been important to markets, that I'm not sure folks should 375 00:19:31,359 --> 00:19:35,520 Speaker 8: feel hopeful is energy permitting reform. That was there's sort 376 00:19:35,520 --> 00:19:38,800 Speaker 8: of a down payment, if you remember, in the debt 377 00:19:38,800 --> 00:19:41,439 Speaker 8: sealing deal, with kind of a promise to address that 378 00:19:41,520 --> 00:19:44,399 Speaker 8: later in this Congress. I think that with all of 379 00:19:44,440 --> 00:19:48,520 Speaker 8: this not nobody should be should be hopeful that there 380 00:19:48,600 --> 00:19:52,479 Speaker 8: is a you know, big grand bargain on energy permitting reform. Now, 381 00:19:52,520 --> 00:19:54,240 Speaker 8: you know, never say never, but at least at this 382 00:19:54,320 --> 00:19:56,160 Speaker 8: point it doesn't it doesn't look likely. 383 00:19:57,440 --> 00:19:59,520 Speaker 3: Well, you point out in your notes of clients. Winning 384 00:19:59,600 --> 00:20:03,320 Speaker 3: is easy, Governing is harder, and I'm sure he's about 385 00:20:03,320 --> 00:20:05,680 Speaker 3: to get a sense of that if he doesn't already 386 00:20:05,680 --> 00:20:08,479 Speaker 3: here with the just the daunting amount of work that 387 00:20:08,560 --> 00:20:11,560 Speaker 3: lies ahead. Libby, what do you make of, if anything. 388 00:20:11,560 --> 00:20:13,720 Speaker 3: I don't know if this is an issue for the 389 00:20:13,760 --> 00:20:15,720 Speaker 3: markets or one for you on a personal level. The 390 00:20:16,040 --> 00:20:19,080 Speaker 3: comments around his attempts to overturn the twenty twenty election. 391 00:20:19,520 --> 00:20:22,280 Speaker 3: Is that's something that will follow him throughout his speakership 392 00:20:22,600 --> 00:20:25,199 Speaker 3: or is that an issue that's being excized as we speak. 393 00:20:26,280 --> 00:20:28,160 Speaker 8: Yeah, So I think that the kind of the read 394 00:20:28,320 --> 00:20:31,239 Speaker 8: through for the markets or the economy is just if 395 00:20:31,280 --> 00:20:35,800 Speaker 8: it has political implications come in twenty twenty four, and 396 00:20:35,880 --> 00:20:38,400 Speaker 8: I think the way that it could, you know, potentially, 397 00:20:38,400 --> 00:20:39,960 Speaker 8: and it's really too early to say. I think that, 398 00:20:40,280 --> 00:20:42,280 Speaker 8: as you know, Joe, a lot haven't been Washington. Folks 399 00:20:42,280 --> 00:20:45,359 Speaker 8: are so breathless about something, how this is just going 400 00:20:45,400 --> 00:20:47,399 Speaker 8: to be sort of existential, and then they just move. 401 00:20:47,320 --> 00:20:49,160 Speaker 9: On and no one even talks about it again. 402 00:20:49,240 --> 00:20:52,920 Speaker 8: So, you know, I'm a little bit reticent about trying 403 00:20:52,960 --> 00:20:55,960 Speaker 8: to drought too many political conclusions, but the market would 404 00:20:55,960 --> 00:21:00,879 Speaker 8: care if there were political consequences. This particular if it 405 00:21:01,040 --> 00:21:05,720 Speaker 8: makes the eighteen Republicans who are defending House districts in 406 00:21:05,920 --> 00:21:10,080 Speaker 8: those districts where President Biden won, so basically purplish districts, 407 00:21:10,119 --> 00:21:13,560 Speaker 8: if you will, if it makes them even more even 408 00:21:13,600 --> 00:21:16,680 Speaker 8: more vulnerable going into twenty twenty four. And of course, 409 00:21:16,720 --> 00:21:20,520 Speaker 8: as we now all painfully know, you know, Republicans only 410 00:21:20,560 --> 00:21:23,240 Speaker 8: have a five seat majority, and so they only need 411 00:21:23,280 --> 00:21:27,320 Speaker 8: to lose five seats in order to in order to 412 00:21:27,359 --> 00:21:30,119 Speaker 8: lose the House. And of course, again there's eighteen districts, 413 00:21:30,119 --> 00:21:32,480 Speaker 8: So I think that's kind of the tie in. If 414 00:21:32,560 --> 00:21:34,680 Speaker 8: having a very sort of you know, work by zone 415 00:21:34,720 --> 00:21:38,680 Speaker 8: amission conservative speaker who didn't vote to certify the twenty 416 00:21:38,720 --> 00:21:43,160 Speaker 8: twenty election, does that make them, these moderate moderate Republicans 417 00:21:43,200 --> 00:21:45,880 Speaker 8: from the places like New York and California even more 418 00:21:45,960 --> 00:21:48,360 Speaker 8: vulnerable going into twenty twenty four, And does that make 419 00:21:48,560 --> 00:21:51,679 Speaker 8: the House vulnerable to flip to Democratic control. 420 00:21:51,720 --> 00:21:53,520 Speaker 9: That will be an issue for the market, because. 421 00:21:53,320 --> 00:21:55,600 Speaker 8: Of course the Trump tax cuts among other fiscal issues 422 00:21:55,640 --> 00:21:56,880 Speaker 8: will be up in twenty twenty five. 423 00:21:57,880 --> 00:21:59,960 Speaker 3: Well, I just imagine the fund that we're going to 424 00:22:00,080 --> 00:22:01,359 Speaker 3: have fear. At least we know who we're going to 425 00:22:01,440 --> 00:22:03,720 Speaker 3: be talking about for the next little bit here. Libby Cantrell, 426 00:22:04,280 --> 00:22:07,280 Speaker 3: many thanks for being with us on this historic day. 427 00:22:07,359 --> 00:22:09,400 Speaker 3: We have a speaker and of course the voice from 428 00:22:09,400 --> 00:22:11,280 Speaker 3: PIMCO to back it up. It's great to see Libyan. 429 00:22:11,359 --> 00:22:13,439 Speaker 3: Thank you as always for joining us here on the 430 00:22:13,440 --> 00:22:17,159 Speaker 3: fastest show in politics. It's certainly moving today in Washington 431 00:22:17,200 --> 00:22:20,000 Speaker 3: as we balance stories on both ends of Pennsylvania Avenue. 432 00:22:20,359 --> 00:22:24,520 Speaker 3: The breaker, of course, Mike Johnson is now Speaker. Johnson 433 00:22:25,160 --> 00:22:30,600 Speaker 3: the fifty sixth Speaker and has the job officially, following 434 00:22:30,640 --> 00:22:34,679 Speaker 3: a protracted process that went through three nominees before we 435 00:22:34,720 --> 00:22:38,240 Speaker 3: got to this one. 436 00:22:39,080 --> 00:22:42,480 Speaker 1: You're listening to The Bloomberg Sound on podcast. Catch the 437 00:22:42,480 --> 00:22:46,399 Speaker 1: program live weekdays at one Eastern on Bloomberg Radio, the 438 00:22:46,440 --> 00:22:49,800 Speaker 1: tune in app, Bloomberg dot Com, and the Bloomberg Business App. 439 00:22:49,920 --> 00:22:52,760 Speaker 1: You can also listen live on Amazon Alexa from our 440 00:22:52,800 --> 00:22:57,280 Speaker 1: flagship New York station. Just say Alexa play Bloomberg eleven thirty. 441 00:22:59,240 --> 00:23:01,080 Speaker 3: If you're just joined seeing us, we have a lot 442 00:23:01,119 --> 00:23:03,520 Speaker 3: to catch up on. We now have a Speaker of 443 00:23:03,560 --> 00:23:07,920 Speaker 3: the House. It actually happened, Mike Johnson, Speaker number fifty 444 00:23:08,000 --> 00:23:10,919 Speaker 3: six as official. He just spoke to the House of 445 00:23:10,920 --> 00:23:14,720 Speaker 3: Representatives and will be speaking to reporters momentarily support from 446 00:23:14,800 --> 00:23:18,080 Speaker 3: the full conference. Nothing like what we saw for Tom 447 00:23:18,160 --> 00:23:23,000 Speaker 3: m or Jim Jordan, Steve Scalise, not a single no vote. 448 00:23:23,240 --> 00:23:25,600 Speaker 3: As he moves forward with the message of unity here 449 00:23:25,600 --> 00:23:28,800 Speaker 3: in the Republican Conference, we'll see if governing will follow. Apparently, 450 00:23:29,480 --> 00:23:33,600 Speaker 3: as Michael McCall told us over a week ago, congressman 451 00:23:33,640 --> 00:23:35,840 Speaker 3: who chairs the Foreign Affairs Committee in the House, the 452 00:23:35,840 --> 00:23:38,280 Speaker 3: first order of business will be bringing a resolution to 453 00:23:38,320 --> 00:23:43,440 Speaker 3: the floor condemning the terror attack by Hamas against Israel 454 00:23:43,520 --> 00:23:48,399 Speaker 3: and supporting Israel as we move forward here. Separately, Joe Biden, 455 00:23:48,480 --> 00:23:52,080 Speaker 3: speaking earlier today in a bilateral news conference with the 456 00:23:52,080 --> 00:23:57,040 Speaker 3: Prime Minister of Australia, speaking to this request for funding 457 00:23:57,119 --> 00:23:59,120 Speaker 3: and this is important because we've talked a lot about 458 00:23:59,160 --> 00:24:02,480 Speaker 3: it through the guys of Israel and Ukraine. This is 459 00:24:02,480 --> 00:24:05,600 Speaker 3: one hundred and six billion dollars he's asking for, and 460 00:24:05,640 --> 00:24:08,960 Speaker 3: supplemental funds would also send money to Taiwan and to 461 00:24:09,119 --> 00:24:14,200 Speaker 3: our southern border for border security. But Bloomberg Government reminds 462 00:24:14,240 --> 00:24:18,440 Speaker 3: us there's more to this as well. Inside that budget 463 00:24:18,480 --> 00:24:24,320 Speaker 3: request also includes money for the Submarine Industrial Base as 464 00:24:24,400 --> 00:24:29,560 Speaker 3: part of our alliance with Australia. Remembering this pact between 465 00:24:29,600 --> 00:24:34,760 Speaker 3: the US, the UK and Australia to counter China's military expansion. 466 00:24:35,480 --> 00:24:38,119 Speaker 3: This would help to pay for that, and it's something 467 00:24:38,119 --> 00:24:39,879 Speaker 3: that we want to talk about, among other issues with 468 00:24:39,960 --> 00:24:45,520 Speaker 3: Jennifer Welsh, Bloomberg Economics Chief geo economics analyst. It's great 469 00:24:45,560 --> 00:24:48,720 Speaker 3: to see you, Jennifer, as someone who of course comes 470 00:24:48,720 --> 00:24:51,840 Speaker 3: out of the national security space. We're juggling a lot 471 00:24:51,840 --> 00:24:54,880 Speaker 3: of priorities here, but they all seem to be when 472 00:24:54,880 --> 00:24:58,920 Speaker 3: it comes to our defense. Included in this supplemental budget request. 473 00:24:59,200 --> 00:25:03,119 Speaker 3: How important is that money for the submarine program with Australia. 474 00:25:04,520 --> 00:25:06,680 Speaker 10: Well, thanks so much again for having me on, Joe. 475 00:25:06,680 --> 00:25:09,640 Speaker 10: It's a pleasure to be here. It's incredibly important. One 476 00:25:09,680 --> 00:25:12,199 Speaker 10: of the challenges that Aucus has faced, and this was 477 00:25:12,320 --> 00:25:15,399 Speaker 10: brought up during the press conference that President Biden just had, 478 00:25:16,040 --> 00:25:18,919 Speaker 10: was the issue of Congressional support for it. And one 479 00:25:19,000 --> 00:25:21,440 Speaker 10: of the main areas of concern for Congress has been 480 00:25:21,960 --> 00:25:24,600 Speaker 10: the DIB issue, as you noted, and the problem there 481 00:25:24,800 --> 00:25:28,159 Speaker 10: is that the submarine deal includes transferring Virginia class subs 482 00:25:28,160 --> 00:25:31,440 Speaker 10: to Australia. But right now the United States it's struggling 483 00:25:31,480 --> 00:25:34,399 Speaker 10: to reach its goal of making two Virginia Class subs 484 00:25:34,440 --> 00:25:36,840 Speaker 10: every year. You add on top of that the need 485 00:25:36,920 --> 00:25:40,359 Speaker 10: to sustain our forces and to transfer to Australia, and 486 00:25:40,440 --> 00:25:42,119 Speaker 10: there's a question there of whether or not we can 487 00:25:42,160 --> 00:25:43,800 Speaker 10: do both these things at the same time. 488 00:25:45,800 --> 00:25:48,920 Speaker 3: Of course, we're asking for sixty billion dollars for Ukraine. 489 00:25:48,960 --> 00:25:52,960 Speaker 3: We're asking for billions more in Israel. And the President 490 00:25:53,000 --> 00:25:56,640 Speaker 3: did speak to the situation in Israel. Here's what he said, Jennifer, 491 00:25:56,640 --> 00:25:59,000 Speaker 3: and we'll have you respond. This is Joe Biden a 492 00:25:59,000 --> 00:26:00,520 Speaker 3: short time ago in the garden. 493 00:26:01,080 --> 00:26:05,920 Speaker 11: The anger of the hurt, the sense of outrage that 494 00:26:05,960 --> 00:26:11,320 Speaker 11: the Israeli people are feeling after the brutally inflicted devastation 495 00:26:11,520 --> 00:26:16,080 Speaker 11: by Hamas is completely understandable. Israel has the right and 496 00:26:16,119 --> 00:26:19,760 Speaker 11: I would add responsibility to respond to the slaughter of 497 00:26:19,800 --> 00:26:23,040 Speaker 11: their people. And we will ensure Israel has what it 498 00:26:23,080 --> 00:26:26,360 Speaker 11: needs to defend itself against these terrorists. That's a guarantee. 499 00:26:28,560 --> 00:26:28,760 Speaker 1: Yep. 500 00:26:29,480 --> 00:26:32,680 Speaker 3: We're asking Israel to slow its role and in fact 501 00:26:32,760 --> 00:26:38,679 Speaker 3: delay the invasion of Gaza. The headline on the terminal 502 00:26:38,720 --> 00:26:41,480 Speaker 3: Biden asking Israel to delay ground war if it helps 503 00:26:41,520 --> 00:26:44,760 Speaker 3: to free hostages. And there's been talk about a potential 504 00:26:45,200 --> 00:26:49,679 Speaker 3: release of more hostages here. Is that what we're waiting for, Jenny. 505 00:26:50,320 --> 00:26:52,040 Speaker 3: Are we potentially going to be in a world where 506 00:26:52,080 --> 00:26:53,359 Speaker 3: there is no invasion of Gaza. 507 00:26:55,200 --> 00:26:57,439 Speaker 10: That's a really good question, and it does seem to 508 00:26:57,480 --> 00:26:59,800 Speaker 10: be a fast moving target in terms of you know, 509 00:27:00,119 --> 00:27:02,640 Speaker 10: Israel saying in terms of their plans for the ground 510 00:27:02,640 --> 00:27:06,400 Speaker 10: offensive kind of changing day by day. More recently, they've 511 00:27:06,480 --> 00:27:08,560 Speaker 10: kind of moved away from referring to it as an 512 00:27:08,640 --> 00:27:11,439 Speaker 10: invasion and more towards an operation, saying that it's going 513 00:27:11,480 --> 00:27:13,480 Speaker 10: to be a lot more targeted. And I think there's 514 00:27:13,480 --> 00:27:15,560 Speaker 10: a couple of factors at play. I think certainly the 515 00:27:15,640 --> 00:27:19,280 Speaker 10: ongoing hostage negotiations are part of it. Certainly US concerns 516 00:27:19,359 --> 00:27:21,280 Speaker 10: are part of it, and as part of an effort 517 00:27:21,280 --> 00:27:24,639 Speaker 10: to avoid this from becoming a broader regional conflict and 518 00:27:24,720 --> 00:27:26,280 Speaker 10: kind of stirring and rest across. 519 00:27:25,960 --> 00:27:26,560 Speaker 6: The Middle East. 520 00:27:26,840 --> 00:27:29,760 Speaker 10: But I think Israeli forces are also very concerned about 521 00:27:29,760 --> 00:27:32,840 Speaker 10: having to fight on multiple fronts already they're taking incoming 522 00:27:33,160 --> 00:27:35,880 Speaker 10: from Hasbela forces. I think there's some concern about whether 523 00:27:35,960 --> 00:27:39,720 Speaker 10: or not they have the bandwidth, in particular air defense bandwidth, 524 00:27:39,760 --> 00:27:43,600 Speaker 10: in order to manage additional incoming coming from Husbola, if 525 00:27:43,600 --> 00:27:46,639 Speaker 10: they start to increase the scale of their attacks to 526 00:27:46,640 --> 00:27:48,920 Speaker 10: take advantage of a ground offensive. And then there's the 527 00:27:48,960 --> 00:27:52,479 Speaker 10: complexity of the ground offensive itself. Gaza is obviously a 528 00:27:52,600 --> 00:27:56,160 Speaker 10: very dense area. There's also the potential for many, many 529 00:27:56,240 --> 00:28:00,000 Speaker 10: tunnels that we don't have great insight into, for Hamasfide 530 00:28:00,200 --> 00:28:03,400 Speaker 10: to be hiding in. It could be a very dangerous operation. 531 00:28:03,680 --> 00:28:05,680 Speaker 10: And I think the United States as well as other 532 00:28:05,720 --> 00:28:08,919 Speaker 10: partners have been counseling Israel to really carefully plan that 533 00:28:09,000 --> 00:28:12,159 Speaker 10: out and to plan out for what happens after the offensive. 534 00:28:12,600 --> 00:28:15,280 Speaker 10: Their goal is to remove Hamas, but what happens after 535 00:28:15,320 --> 00:28:16,480 Speaker 10: Hamas is gone? 536 00:28:17,640 --> 00:28:19,879 Speaker 3: A lot of good questions here, the presidents saying earlier 537 00:28:19,880 --> 00:28:22,680 Speaker 3: today in the Rose Garden, what I've indicated to him 538 00:28:22,880 --> 00:28:25,600 Speaker 3: by that he means, Benjamin Netanyaho is that if that's 539 00:28:25,680 --> 00:28:28,199 Speaker 3: possible to get these folks out safely, that's what he 540 00:28:28,280 --> 00:28:32,880 Speaker 3: should do. It's their decision. But of course Benjamin Netanyahu 541 00:28:33,600 --> 00:28:35,560 Speaker 3: doesn't want to lose the US in this fight. How 542 00:28:35,600 --> 00:28:39,400 Speaker 3: closely is he listening to Joe Biden, No, I would. 543 00:28:39,240 --> 00:28:41,720 Speaker 10: Say, compared to where we were soon after the October 544 00:28:41,760 --> 00:28:44,480 Speaker 10: seventh attack, and where we are today. Again that ground 545 00:28:44,480 --> 00:28:47,000 Speaker 10: offensive hasn't happened. It seemed to be on the bridge 546 00:28:47,000 --> 00:28:50,560 Speaker 10: of it, you know, several weeks ago. Now we've seen 547 00:28:50,720 --> 00:28:52,960 Speaker 10: Israel kind of budge a little bit on making sure 548 00:28:52,960 --> 00:28:56,000 Speaker 10: aid is flowing into Gaza. We've seen them, you know, 549 00:28:56,080 --> 00:28:59,400 Speaker 10: start to address concerns about civilian casualties, include coming out 550 00:28:59,560 --> 00:29:02,560 Speaker 10: very clear on the nature of the hospital attack that 551 00:29:02,640 --> 00:29:05,560 Speaker 10: happened last week. So I do think that Israel is 552 00:29:05,560 --> 00:29:09,280 Speaker 10: listening to the US. I think also US regional support 553 00:29:09,320 --> 00:29:12,240 Speaker 10: has been helpful to sort of reassuring Israel, both the 554 00:29:12,280 --> 00:29:15,280 Speaker 10: presence of US forces in the region as well as 555 00:29:15,400 --> 00:29:18,200 Speaker 10: US efforts to try and line up regional powers to 556 00:29:18,280 --> 00:29:21,000 Speaker 10: at least, if not at the very least support Israel, 557 00:29:21,040 --> 00:29:22,880 Speaker 10: then to at least, you know, kind of decry the 558 00:29:22,880 --> 00:29:26,720 Speaker 10: attack and not foment or add fire to the flame. 559 00:29:26,800 --> 00:29:29,280 Speaker 10: So I think all of that is helping sort of 560 00:29:29,440 --> 00:29:32,479 Speaker 10: take us down a steparate too, at least temporarily in 561 00:29:32,520 --> 00:29:35,239 Speaker 10: the conflict. But it remains to be seen, you know, 562 00:29:35,240 --> 00:29:37,840 Speaker 10: where Israel goes from here, and I think the Biden 563 00:29:37,840 --> 00:29:40,920 Speaker 10: administration is being very careful to at least publicly indicate 564 00:29:40,960 --> 00:29:45,120 Speaker 10: that this is still very much within Israel's agency rather 565 00:29:45,160 --> 00:29:47,760 Speaker 10: than being directed by the US. That being said, I 566 00:29:47,760 --> 00:29:50,840 Speaker 10: think behind closed doors, the US is very much counseling 567 00:29:50,960 --> 00:29:53,320 Speaker 10: Israel to approach us in a way that is both 568 00:29:53,320 --> 00:29:56,200 Speaker 10: good for Israel strategically and in the long term, but 569 00:29:56,280 --> 00:30:00,480 Speaker 10: also helps further inflame avoid further inflaming regional tensions. 570 00:30:01,200 --> 00:30:04,560 Speaker 3: Jenny Welch helps to advise our Bloomberg Economics team here 571 00:30:04,560 --> 00:30:07,000 Speaker 3: in Washington, and it's great to have you back, Jenny. 572 00:30:07,040 --> 00:30:07,880 Speaker 4: Thank you for the insights. 573 00:30:07,960 --> 00:30:10,840 Speaker 3: Jenny Welch at Bloomberg with us on sound On as 574 00:30:10,840 --> 00:30:13,280 Speaker 3: we move forward here with a speaker of the house, 575 00:30:13,440 --> 00:30:17,760 Speaker 3: dare to dream it's true. If you're just joining us, 576 00:30:18,720 --> 00:30:22,000 Speaker 3: Joe Biden will soon be talking to speaker Mike Johnson. 577 00:30:22,560 --> 00:30:24,560 Speaker 3: We'll let you know when that phone call takes place. 578 00:30:24,960 --> 00:30:27,280 Speaker 3: Thanks for listening to the sound On podcast. Make sure 579 00:30:27,280 --> 00:30:30,160 Speaker 3: to subscribe if you haven't already, at Apple, Spotify, and 580 00:30:30,240 --> 00:30:32,760 Speaker 3: anywhere else you get your podcasts. And you can find 581 00:30:32,840 --> 00:30:35,920 Speaker 3: us live every weekday from Washington, DC at one pm 582 00:30:35,960 --> 00:30:40,120 Speaker 3: Eastern Time at Bloomberg dot com.