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Speaker 2: From a true social post that President Trump has specifically
Speaker 2: addressed to quote the great farmers of the United States,
Speaker 2: it reads as follows, get ready to start making a
Speaker 2: lot of agricultural product to be sold inside of the
Speaker 2: United States. Tariffs will go on external product on April second,
Speaker 2: ending this true social post. Have fun. And when we
Speaker 2: consider what the impact of this could be, Joe, US
Speaker 2: agricultural imports buy and large from other countries include horticultural products, fruits, vegetables,
Speaker 2: that sort of thing. We do actually import.
Speaker 3: A lot of that.
Speaker 2: In fact, the annual growth rate was nearly six percent
Speaker 2: from fiscal years to twenty thirteen to twenty twenty three.
Speaker 2: And the fact that this is April second that he's
Speaker 2: talking about means we tack this on, presumably to reciprocal
Speaker 2: tariffs that he suggested, we'll go into effect that date. Autostos,
Speaker 2: what else am I missing, there's a laundry.
Speaker 3: List, steal an aluminum? Is that the second?
Speaker 4: I might have to check my home game for that one,
Speaker 4: because the timeline is getting a little confused here. External products,
Speaker 4: he refers to, Yeah, James Copper, that's another one that
Speaker 4: we're looking at as well. The question is will any
Speaker 4: of these be implemented? And, by the way, how long
Speaker 4: it might take our great farmers, as he refers to them,
Speaker 4: to ramp up production to replace what could be a
Speaker 4: lot of missing imports and prevent prices from rising. This
Speaker 4: is part of our conversation with Liz Pancotti, who's joining
Speaker 4: us right now to talk it out. Managing director of
Speaker 4: Public Policy and Advocacy at the Groundwork Collaborative. Liz was
Speaker 4: an economic advisor to Senator Bernie Sanders, and it's great
Speaker 4: to have you with us here, Liz, I'm not even
Speaker 4: sure where to begin, but big picture, you see the
Speaker 4: confusion in the markets here. What do you do with
Speaker 4: the lack of information when it comes to tariffs? And
Speaker 4: do you think any of them will in fact be
Speaker 4: put into effect tomorrow?
Speaker 5: You know, I think everyone's quite confused. This morning's ism
Speaker 5: manufacturing report hammered business uncertainty about tariffs, which is affecting
Speaker 5: both consumer spending and capital spending. Folks are just not
Speaker 5: willing to make decisions about what to spend and if
Speaker 5: to spend, and as a result, you're seeing quite a
Speaker 5: bit of economic softening. Consumer sentiment is down, consumer inflation
Speaker 5: expectations are up, small business optimism is down, and uncertainty
Speaker 5: is up. Consumer spending is down, and we just heard
Speaker 5: the market's report. It's not looking good.
Speaker 2: Well, and there is a certain degree of overlap here.
Speaker 2: I want to ask about, Liz, because the two largest
Speaker 2: suppliers of US agricultural imports Canada and the European Union,
Speaker 2: followed by Mexico, and we're already talking about tariffs going
Speaker 2: into place potentially on Canadian and New Mexican goods tomorrow
Speaker 2: of twenty five percent. What happens to all of these
Speaker 2: are compounded, then they all layer on top of each other,
Speaker 2: and the rates ultimately end up much higher than what
Speaker 2: we're thinking about right now.
Speaker 5: I think this is the issue is, you know, the
Speaker 5: Trump administration is not being clear about exactly what's happening.
Speaker 5: This morning, you had Commerce Secretary Lutnik saying tariffs may
Speaker 5: go into effect tomorrow, but at lower levels. Treasury Secretary
Speaker 5: Bescent said tariffs might be paused if Canada and Mexico
Speaker 5: increase their tariffs on China. In fact, Secretary Lutnik a
Speaker 5: couple hours ago said, we'll have an announcement tomorrow. Except
Speaker 5: the problem is these tariffs supposedly go into effect at
Speaker 5: midnight tonight. I think the uncertainty is extremely hard for
Speaker 5: both consumers and businesses to operate in this environment. The
Speaker 5: other issue have for farmers that you know President Trump
Speaker 5: is boasting about the returns that they'll get from this
Speaker 5: on truth social is that this could increase their fertilizer prices,
Speaker 5: the prices they pay for agricultural equipment, much of which
Speaker 5: is imported. And so even though you may have you know,
Speaker 5: increases in demand for domestically produced agriculture, much of our
Speaker 5: agriculture products right now are imported, especially things like food
Speaker 5: and groceries. The input costs for how much it costs
Speaker 5: to produce those is likely to rise, sort of limiting
Speaker 5: what farmers are able to do in terms of increasing supply.
Speaker 4: Well, so, which one of these keeps you up at night?
Speaker 4: Which one has the biggest impact on the US economy?
Speaker 4: Is it Mexico Canada tariffs that could be implemented tomorrow.
Speaker 4: Is it reciprocals that come in April Autos steal an
Speaker 4: aluminum cop for some of the stuff that we've already
Speaker 4: talked about. Liz, you've got a big menu to pick from.
Speaker 5: It all keeps me up at night, and I think
Speaker 5: more importantly, it keeps American families and consumers up. You know,
Speaker 5: they voted for President Trump in hopes that he would
Speaker 5: bring down their prices, especially those they're facing on essentials
Speaker 5: at the grocery store. And instead of bringing their prices down,
Speaker 5: he is focused on, you know, indiscriminate tariffs that do
Speaker 5: nothing to protect American jobs or strengthen US manufacturing. And
Speaker 5: instead of imposing tariffs on allies on Canada that will
Speaker 5: hurt workers and raised prices, he really should be focusing
Speaker 5: on holding countries like China accountable for undercutting American workers
Speaker 5: and businesses. Sort Of lost in this whole conversation is
Speaker 5: that Trump walk back closing the Deminimus loophole that allows
Speaker 5: China to flood the US with cheap goods without being
Speaker 5: expected or paying tariffs. So it keeps me up at
Speaker 5: night that we're not doing any of this strategically. There
Speaker 5: are certainly strategic cases for tariffs. The President doesn't seem
Speaker 5: to be making them and certainly doesn't seem to be
Speaker 5: implementing them in a strategic way, which really does ultimately
Speaker 5: hurt both consumers, workers, families, and agriculture, you know, farmers,
Speaker 5: the whole nine yards.
Speaker 2: Well, so, Liz, when we consider the impact on consumers
Speaker 2: and the actual prices, they will see what we frequently
Speaker 2: hear from officials in the Trump administration are those aligned
Speaker 2: with his way of thinking on tariffs? Is what we're
Speaker 2: talking about here is a one time price increase, not
Speaker 2: necessarily sustained inflation as we experienced during the Biden administration.
Speaker 2: Is there a world in which though a one time
Speaker 2: price increase can actually precipitate an inflationary spiral if consumers
Speaker 2: expect that prices are going to keep going up even
Speaker 2: if they wouldn't have necessarily on their own.
Speaker 5: Yeah, I don't think this. There's any world where this
Speaker 5: is a one time increase. If these are all implemented
Speaker 5: in such a haphazard way, you know, as Joe said before,
Speaker 5: maybe these are leveled on top of each other, Maybe
Speaker 5: something comes tomorrow, and maybe something comes in April. And
Speaker 5: what about in six months when the president gets mad
Speaker 5: in another country that he wouldn't let them land a
Speaker 5: plane full of undocumented immigrants he's trying to deport. This
Speaker 5: really is just a needless trade war that he is
Speaker 5: lever that he is, you know, really picking with the
Speaker 5: entire world. I don't if you expected a one time
Speaker 5: increase in prices, or if that was your goal, you
Speaker 5: might implement all the tariffs all at once, in a
Speaker 5: very clear fashion, on a very clear set of goods. Instead,
Speaker 5: we're getting you know, delays on this, layers on this,
Speaker 5: changing in decisions at the last mint.
Speaker 6: It.
Speaker 5: I don't see how this is a one time price increase,
Speaker 5: especially with where consumer and business sentiment is. I think
Speaker 5: this is likely to spiral and more likely to see
Speaker 5: downstream effects for months to come as the Trump administration
Speaker 5: continues to play games with the implementation of these policies.
Speaker 3: Well, you know, we hear past is prologue a lot
Speaker 3: around here.
Speaker 4: We ask members of the administration about the potential inflationary
Speaker 4: impact of tariff's Liz Scott Besson was presented over the
Speaker 4: weekend with this Peterson Institute report showing the tariff policy
Speaker 4: could cost the typically US household an additional twelve hundred
Speaker 4: dollars a year. He called the report alarmist and referred
Speaker 4: to the first Trump administration.
Speaker 3: That showed tariffs did not affect prices.
Speaker 4: He said, how do you argue with that when you
Speaker 4: do have the example of the first administration.
Speaker 5: For this president, I think tariffs are likely to affect prices.
Speaker 5: It's unlikely to be a full one to one pass through.
Speaker 5: I think the bigger question is what are corporations going
Speaker 5: to do with the announcement of these tariffs? As we
Speaker 5: saw over the last four years, corporations really look for
Speaker 5: opportunities to pass increased prices and then some onto consumers.
Speaker 5: That pricing environment and those conditions really weren't present in
Speaker 5: the seventeen to nineteen period that Secretary of Descent is
Speaker 5: talking about. And so I think the bigger question is
Speaker 5: what are corporations going to do with this increased cost
Speaker 5: for them? How will they pass them on to consumers?
Speaker 5: If it looks anything like the priest you know the
Speaker 5: last four years that we've seen, they're likely to pass
Speaker 5: actually more than a dollar through to consumers because they can,
Speaker 5: because they know that they have favorable pricing conditions.
Speaker 2: Well, so when we consider them that pricing power that
Speaker 2: companies may have, their ability to pass costs on to
Speaker 2: the consumer is dependent on the consumer actually tolerating that
Speaker 2: and still being willing to purchase those items. Is there
Speaker 2: a world, though, list where we just see a precipitous
Speaker 2: drop in demand of consumers with say no, we are
Speaker 2: not going to swallow those increased costs.
Speaker 5: I think that's exactly right. And in fact, retail sales
Speaker 5: fell almost a percentage point in January from the prior
Speaker 5: month according to Commerce Department data we got last week,
Speaker 5: which is the first monthly declined since August of twenty
Speaker 5: twenty four. Consumers are already starting to withhold what they're spending,
Speaker 5: either out of uncertainty or because of increased prices. I
Speaker 5: think you can absolutely expect that to continue.
Speaker 4: Well, you had layoffs and things start to get interesting here, Liz.
Speaker 4: I don't know what kind of numbers we're going to
Speaker 4: see on Friday, and if, in fact a lot of
Speaker 4: these announcements following the reference date might in fact make
Speaker 4: us wait another month or two, but at some point
Speaker 4: we're going to start seeing the impact of federal government
Speaker 4: layoffs in economic data. We've got a jobs report coming
Speaker 4: out on Friday. We know that the Education Department has
Speaker 4: put up a midnight deadline for its staffers. Those who
Speaker 4: quit get a twenty five thousand dollars payout. There's a
Speaker 4: DoD purge coming. We've already talked about USAID and so
Speaker 4: many other agencies. What will that look like in the
Speaker 4: jobs report this week and over the next couple of months.
Speaker 5: The federal government is, though the largest individual employer in
Speaker 5: the country, it accounts for about two percent of total employment. Obviously,
Speaker 5: we're not laying off the entire federal government yet so far.
Speaker 5: I don't expect that we will see especially given where
Speaker 5: the reference period was. I don't expect we'll see a
Speaker 5: massive blip. But I think in the months to come,
Speaker 5: you can expect to start to see those jobs. Both
Speaker 5: of those first order effects of actual federal jobs being cut,
Speaker 5: the second order effects that either federal funding freezes or
Speaker 5: contracts being pulled people who are funded people whose jobs
Speaker 5: are funded by federal spending. And then the third order
Speaker 5: effects are of course, you know, if you have a
Speaker 5: bunch of laid off federal employees or federally funded employees
Speaker 5: stop spending money at the grocery store or at the
Speaker 5: lunch counter, or in their neighborhoods, or not sending their
Speaker 5: kids to degare because they're home. And you have that
Speaker 5: drop in consumer demand, you are ultimately going to see, really,
Speaker 5: you are going to see effects really kind of reverbiate
Speaker 5: through the economy. You have to think about the economy
Speaker 5: that Trump inherited. On paper, he inherited almost a perfect economy,
Speaker 5: high consumer sentiment, low unemployment, inflation almost at target, and
Speaker 5: he has really, within a matter of weeks almost almost
Speaker 5: ruined it. You are starting to see that honeymoon period
Speaker 5: really come to a close. Does not so much look
Speaker 5: like his first term, and certainly does not look like
Speaker 5: the economy that President Biden was able to turn around
Speaker 5: within a couple of months of taking office. So the
Speaker 5: prospects don't look good. And I'm worried about this softening
Speaker 5: that's already happening this close into the administration. And I
Speaker 5: do suspect that if we don't see it in NICH
Speaker 5: Jobs report, the next two won't be so rosy. And
Speaker 5: then we've got CPI next week that might not look
Speaker 5: great either.
Speaker 2: Well, In the meantime, tomorrow, Liz, we are expecting President
Speaker 2: Trump to Trump to address a joint session of Congress,
Speaker 2: in which I'm sure he's going to talk about his
Speaker 2: ambitions for tax cuts and extending the twenty seventeen tax cuts. Specifically,
Speaker 2: is you talk about a softening in the consumer what
Speaker 2: would happen if those actually do expire at the end
Speaker 2: of the year.
Speaker 5: Those tax cuts have very little effect on the vast
Speaker 5: majority of America pocketbooks. For the bottom fifty percent, you're
Speaker 5: looking at a couple hundred dollars, whereas the top point
Speaker 5: one percent you're looking at about three hundred thousand dollars each.
Speaker 5: And so I think, really, if you combine what they
Speaker 5: are proposing, which is massive cuts to things like Medicaid,
Speaker 5: food stamps, vital programs that support middle class families balance sheets,
Speaker 5: and you combine that with large tax cuts for the wealthy,
Speaker 5: who are much less likely to consume and spend in
Speaker 5: the economy, it's both a picture that doesn't look good
Speaker 5: for middle class families but also doesn't look good on
Speaker 5: the broader macro scale in terms of consumer demand.
Speaker 4: Boy, we've got a lots to figure out here, obviously,
Speaker 4: Liz if these I know you're not a market analyst,
Speaker 4: but these terriffs don't take effect.
Speaker 3: Do we have a big rally on our hands?
Speaker 5: I don't think so. We didn't see one when Trump
Speaker 5: pulled down the announcement last time, and I think you know,
Speaker 5: to some extent, they're all priced in, right. I think
Speaker 5: the markets are expecting some amount of chaos here, but
Speaker 5: I don't foresee a big rally given the other things
Speaker 5: going on in the economy, federal job layoffs, consumer sentiment.
Speaker 5: The uncertainty also causes quite a bit of calamity, and
Speaker 5: so I'm certainly not looking at my portfolio expecting a
Speaker 5: rally if that gets pulled down.
Speaker 7: Well.
Speaker 2: Right now, stocks are just around the lows of the session,
Speaker 2: down about a percent on the S and P five
Speaker 2: hundred in Nasdaq one hundred. Liz Pancotti, Managing director of
Speaker 2: Policy and Advocacy at the Groundwork Collective, thank you so
Speaker 2: much for joining us collaborative, I should say, as we
Speaker 2: deal with this breaking news.
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Speaker 2: The reports of that investment one hundred billion dollars TSMC
Speaker 2: is slated to make in the United States, that expected
Speaker 2: to be announced at the White House by President Trump
Speaker 2: later around this hour. It's scheduled for thirty pm Eastern time.
Speaker 2: We'll see if that holds. Things have been running late
Speaker 2: as of late at the White House, and certainly that
Speaker 2: was true on Friday as well, although things also ended
Speaker 2: earlier than expected. When President Trump was meeting with Ukrainian
Speaker 2: President vladimir's Lynsky, keeping in mind, they were supposed to
Speaker 2: sign a deal on minerals in which the wealth that
Speaker 2: Ukraine derives from minerals was going to be shared with
Speaker 2: the United States, the President seeing that as a step
Speaker 2: toward peace ultimately with Russia, in a way to provide
Speaker 2: security guarantee to Ukraine through economic means. But as we've
Speaker 2: all learned and I'm sure have seen replayed over the
Speaker 2: last several days, things went south quickly in that Oval
Speaker 2: Office meeting.
Speaker 3: Mister President with respect, I think it's disrespectful.
Speaker 5: For you to come into the Oval Office to try
Speaker 5: to litigate this in front of the American media. You
Speaker 5: should be thanking the president for to bring it into
Speaker 5: this conflicts.
Speaker 6: Into Ukraine that you say, what problems we have.
Speaker 3: I have been to Kamban. I were not in a
Speaker 3: good position. I was. You don't have the cards right
Speaker 3: now with us. You start having coins car right.
Speaker 5: Now play.
Speaker 4: You're gambling with World War three and what you're doing
Speaker 4: is very disrespectful to the country.
Speaker 3: Have you said thank you once that lawyer meeting.
Speaker 4: Now, as we just mentioned earlier, we advance over the
Speaker 4: weekend to a meeting in the UK with Prime Minister
Speaker 4: Keir Starmer and commentary from President Zelenski that an end
Speaker 4: of the war with Russia is quote very very far away.
Speaker 4: Donald Trump did not like that line, putting to truth
Speaker 4: social a short time ago. Today, this is the worst
Speaker 4: statement that could have been made by Zelenski, and America
Speaker 4: will not put up for it for much longer. He
Speaker 4: goes on to write, meeting they had with Zelensky stated
Speaker 4: flatly they cannot do the job without the US. Referring
Speaker 4: to the Europeans, and he says, this guy referring to
Speaker 4: Vladimir Zelenski does not want there to be peace as
Speaker 4: long as he has.
Speaker 3: America is backing.
Speaker 4: Zelensky, taking to social media himself out with a statement
Speaker 4: a short time ago to take issue with this, thank
Speaker 4: the American people for what they have given so far,
Speaker 4: and a lot of questions about what this is going
Speaker 4: to lead to with a minerals deal that remains unsigned,
Speaker 4: and what we might hear from the President tomorrow night
Speaker 4: and his address to a joint session of Congress. With
Speaker 4: us to get into all this right now is Michael Allen.
Speaker 4: He's back with us here at the table. Managing director
Speaker 4: Beacon Global Strategy, is former special assistant to President George W.
Speaker 3: Bush in the national security space. Michael, welcome back, Thank
Speaker 3: you to see you. Thank you.
Speaker 4: It's a precarious moment, being right before a major event
Speaker 4: like this that Donald Trump is also professing to tell
Speaker 4: it like it is.
Speaker 3: What's he going to say about Ukraine tomorrow? Might it
Speaker 3: actually be a deal?
Speaker 8: Well?
Speaker 9: I hope that the President will say that he wants
Speaker 9: to get back on side with the Ukrainians and sign
Speaker 9: the minerals deal as soon as possible. But I'm really
Speaker 9: worried right now and I say, this is somebody that
Speaker 9: supports Ukraine. I feel like Zelensky is almost practicing malpractice
Speaker 9: when it comes to politics here. We all know the
Speaker 9: way it should work when you come to visit the
Speaker 9: United States. You have to get this relationship right if
Speaker 9: you're in Ukraine and you depend on the economic and
Speaker 9: military superpower as much as you do. President Trump thinks
Speaker 9: of himself as the honest broker here. We may wish
Speaker 9: he were more on side with the Western Powers, but
Speaker 9: he wants to broker a piece, so he sees himself
Speaker 9: as trying to condition the two parties to get in here.
Speaker 9: And I really feel like Zelenski keeps getting him his
Speaker 9: own way. He should just say I look forward to peace.
Speaker 9: I want it to be a durable piece. He should
Speaker 9: look for security assurances later. Trump wasn't going to issue
Speaker 9: those in the meeting last week. He's not going to
Speaker 9: do it on truth social It would be at the
Speaker 9: end of the day anyway. So I hope he can
Speaker 9: clean his messaging up. He's a politician, He's got to
Speaker 9: be able to read the room. And let's shift the
Speaker 9: focus over to Vladimir Putin. If you want to talk
Speaker 9: about obstinate that's where you'll start seeing it. And let's
Speaker 9: let Putin occupy the space for a little while.
Speaker 2: Well, you speak to an important point here, which is
Speaker 2: that the crux of the issue, it seems, is that
Speaker 2: Ukraine wants more commitment from the US on keeping a
Speaker 2: piece secure than the President right now at least seems
Speaker 2: willing to provide. Dlensky's suggestion in that meeting was a
Speaker 2: mineral's deal alone is not enough that Ukraine needs more
Speaker 2: than that. If that is still the fundamental issue, do
Speaker 2: you see them being able to sort that out? Otherwise,
Speaker 2: why would you crane agree to whatever Trump to goes.
Speaker 9: Well, I see them getting farther away from an eventual
Speaker 9: deal where the United States plays some role in a
Speaker 9: European peacekeeping force. That's why I want Zelensky to keep
Speaker 9: trying to advance the ball forward the minerals deal. It
Speaker 9: could have been a huge win for last week, especially
Speaker 9: considering where they had been the week prior to that.
Speaker 8: And so I'm the dictator of misinformation bubble, Yes, the
Speaker 8: misinformation bubble. You can't. Actually it's not just Trump.
Speaker 9: I don't think any president wants to be messaged negatively
Speaker 9: by another world leader through the media, and you especially
Speaker 9: don't want that in the person's presence in the Oval office.
Speaker 9: So I think to get to where Zolensky needs to go,
Speaker 9: he needs to say.
Speaker 8: The right thing. Step back.
Speaker 9: Let the Europeans advance the ball a little bit on
Speaker 9: security assurances. They had a big meeting yesterday and they
Speaker 9: decided something along the lines of well, why don't we
Speaker 9: do a one month cease fire in terms of in
Speaker 9: the air and in the sea and on energy attacks.
Speaker 8: Let's let them run with the ball for a little while.
Speaker 4: What we heard from the Prime Minister of the UK
Speaker 4: he hosted twenty allies in London on Sunday, kir Starmer
Speaker 4: and talking about joining with France to step up to
Speaker 4: support Ukraine here and forge a peace plan they could
Speaker 4: offer to Donald Trump. I don't know how receptive he's
Speaker 4: going to be to a peace plan that's coming from Europe.
Speaker 4: But here's Kirre Starmer following the meeting with Zelenski and others.
Speaker 7: We are at a crossroads in history today. This is
Speaker 7: not a moment for more talk. It's time to act.
Speaker 7: The UK is prepared to back this with boots on
Speaker 7: the ground and planes in the air, together with others.
Speaker 7: Europe must do the heavy listing.
Speaker 4: A coalition of the willing, as he describes it, I
Speaker 4: feel like we've seen this movie before.
Speaker 3: How much can they actually do on their own without
Speaker 3: the US.
Speaker 9: Well, at least they could do a great deal in
Speaker 9: terms of just putting troops on the ground. And this
Speaker 9: is actually what the Trump White House wants. He wants
Speaker 9: these types of commitments to step forward.
Speaker 8: But I think everybody.
Speaker 9: Knows that at the end of the day, you would
Speaker 9: still need what the Europeans are calling a US backstop,
Speaker 9: and that basically means that we would help with command
Speaker 9: to control, intelligence, maybe overflight, so it would be a
Speaker 9: more limited role. Trump's definitely not going to put US
Speaker 9: troops on the ground in Ukraine. But if they can
Speaker 9: help with the mission from Afar, maybe that's something that
Speaker 9: Trump could sign up to if it's to get a
Speaker 9: deal in the final analysis. But it's not on brand
Speaker 9: for Trump to agree to this. At this point in
Speaker 9: the negotiations. He's trying to be the mediator, rightly or wrongly,
Speaker 9: and so he's not going to just absolutely tramp on
Speaker 9: what he believes to be a putin redline.
Speaker 2: Well, and when he was asked in the Oval Office
Speaker 2: meeting last week. Whose side he's on or if he
Speaker 2: was in the middle. He says he's for both Ukraine
Speaker 2: and Russia. Truly just sees himself as a middleman here.
Speaker 2: Didn't suggest he's advocating for one side or the other,
Speaker 2: but on the Russian side. How has all of this
Speaker 2: changed the calculation for Vladimir Putin with he's considering what
Speaker 2: concessions he does or does not need to make in
Speaker 2: any deal.
Speaker 8: Well, so I agree.
Speaker 9: I don't think this was done as a calculated way
Speaker 9: to give a gift to the Russians, but that's the outcome.
Speaker 9: In reality, the Russians are loving this. They're able to
Speaker 9: see Ukraine lose ground with the United States, not just substantively,
Speaker 9: but substantively and publicly.
Speaker 8: And so this is.
Speaker 9: Not a great place for Zelensky to be. I feel
Speaker 9: like he needs to say, listen, I am for peace.
Speaker 9: I just want it to be durable, and I regret
Speaker 9: that I've aired all of our differences in the public sphere.
Speaker 9: And let's try to get the minerals deal signed and
Speaker 9: get back on track, and let's put the emphasis on Putin.
Speaker 9: He's the one that's truly recalcitrant. If he gets into
Speaker 9: this and starts to deny Trump elements of what Trump
Speaker 9: wants to be able to advance as part of peace talks,
Speaker 9: then let's see Trump go after Putin for a while
Speaker 9: instead of Zelenski.
Speaker 4: It's your point. The line from the Kremlin is remarkable.
Speaker 4: Quote this is from Kremlin spokesman Dmitri Peskoff. The new
Speaker 4: administration is rapidly changing all foreign policy configurations. This largely
Speaker 4: aligns with our vision.
Speaker 3: Unquote. Is Ronald Reagan spinning in his grave?
Speaker 8: I think so.
Speaker 9: But more importantly, I think a lot of people in
Speaker 9: the Republican Senate are probably very uncomfortable with the way
Speaker 9: this is going down. I think they want to be
Speaker 9: able to argue that, hey, Russia is our obstinate sort
Speaker 9: of opponent, but they don't have any sort of room
Speaker 9: to do that yet because of the way that this
Speaker 9: is going down at the present moment, Which is another
Speaker 9: reason why we need to get past this Zelensky disaster
Speaker 9: from last week and get back to the merits of
Speaker 9: the deal, because I think that the Europeans and Republican
Speaker 9: senators and others need to start saying back to the
Speaker 9: White House I'm glad you're trying to mediate here. We
Speaker 9: want peace also, but let's not give away too much
Speaker 9: to Russia.
Speaker 2: So what's the role a former senator and Secretary of
Speaker 2: State Marco Rubio or the National Security Advisor Mike Waltz,
Speaker 2: for example, in all of this? Can they provide that
Speaker 2: check to what Trump's impulses might be right now?
Speaker 10: Around your well?
Speaker 8: I think they can somewhat.
Speaker 9: But what I've been sort of arguing to people of
Speaker 9: late is that Donald Trump is making all the decisions
Speaker 9: in his administration. It may not always be this way
Speaker 9: the way that the presidency may catch up. There may
Speaker 9: be other events that'll have to focus on. But Trump
Speaker 9: is deciding personnel matters, He's deep into the doge. He's
Speaker 9: very much deciding, if not all of the tariff decisions,
Speaker 9: the vast majority of them. So Trump is totally invested
Speaker 9: in his presidency, making every decision. So I haven't seen
Speaker 9: a lot of room for cabinet government in areas where
Speaker 9: Trump is plugged in, and in foreign affairs and on
Speaker 9: this war, he is basically very plugged in.
Speaker 4: What will be his tone is posture on Ukraine tomorrow night,
Speaker 4: when he speaks to a joint Session of Congress, remembering
Speaker 4: the Ukrainian flags that lined Pennsylvania Avenue going to the
Speaker 4: Capital of the Knight, that Zelensky also addressed a joint
Speaker 4: session of Congress, or when he joined the First Lady
Speaker 4: in the gallery as a guest of honor of the President.
Speaker 4: It's going to be a very, I presume, different feel.
Speaker 9: It is going to be a different feel. I think
Speaker 9: he's going to fault Zelensky for not being ready to
Speaker 9: enter into piece to a piece equation. I think that's
Speaker 9: going to be the overriding message when Trump at his core,
Speaker 9: for all we say about Trump, really just wants to
Speaker 9: end the killing. He doesn't subscribe to some international relations
Speaker 9: theory the different folks in Washington have subscribed to. He
Speaker 9: wants to stop the killing as soon as possible. He
Speaker 9: sees a path in that direction, and right now Zelensky
Speaker 9: looks like he's in the way and Putin's hidden, And
Speaker 9: so I think Zelensky's going to continue to be faulted
Speaker 9: until he cleans everything up.
Speaker 2: So with things as they stand now, how soon do
Speaker 2: you think, realistically is possible.
Speaker 9: For I don't think it's I would have hoped that
Speaker 9: Zelensky would have said something over the weekend and had
Speaker 9: done something more quickly.
Speaker 8: But if we can.
Speaker 9: Start reacting maybe to the ideas that the Europeans are
Speaker 9: putting on the table, the cease fire in the air
Speaker 9: and in the sea, and begin to talk through some
Speaker 9: different details, maybe that eventually changes the dynamics, because the
Speaker 9: one we're in right now is not a good.
Speaker 2: One, all right, Michael Allen, Great to see you, as
Speaker 2: always here in our Washington, d C. Studio. He's Managing
Speaker 2: director of Beacon Global Strategies, also former Special Assistant to
Speaker 2: President George W. Bush in the national security sector. Here
Speaker 2: with us on Balance of Power.
Speaker 1: You're listening to the Bloomberg Balance of Power podcasts. Catch
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Speaker 4: We're talking politics here on a big week in Washington.
Speaker 4: Great to have you with us on Bloomberg Radio on
Speaker 4: the satellite radio channel one twenty one and.
Speaker 3: On YouTube search Bloomberg Business News Live.
Speaker 4: You can get to hang out with our signature panel
Speaker 4: and just a moment, Rick and Jeanie will be in
Speaker 4: as we set things up for the super Bowl of
Speaker 4: politics tomorrow night, the big speech to a joint Session
Speaker 4: of Congress, what would in any other year be called
Speaker 4: a State of the Union. And as we find the
Speaker 4: headline at Bloomberg Government, a speech and deadline set up
Speaker 4: March powder keg. Yeah, welcome to March. I hope you
Speaker 4: enjoyed the weekend.
Speaker 3: I got some rest because Beegov is right.
Speaker 4: March offers two new windows into how Democrats and Republicans
Speaker 4: are dealing with the new Trump administration and what Jonathan
Speaker 4: Tomory calls Trump's bulldozer style presidency one of the national
Speaker 4: spotlight one behind closed doors. I already mentioned tomorrow night,
Speaker 4: the big spectacle, Trump's speech joint Session of Congress. We
Speaker 4: will all be together here for special coverage starting at
Speaker 4: eight pm Eastern time.
Speaker 3: I hope you're with us.
Speaker 4: Then it's onto government funding. Yes, the key dividing line
Speaker 4: centering on the sharp cuts that Donald Trump and Elon
Speaker 4: Musk have imposed. This is why Democrats are not feeling
Speaker 4: like playing along at the moment with a continuing resolution
Speaker 4: that would go through the end of the fiscal year
Speaker 4: straight through September. Pentagon hawks on a Love that Freedom
Speaker 4: caucus at all of it too.
Speaker 3: And we've got a new.
Speaker 4: Poll rolled out Sunday Morning CBS News You Go of
Speaker 4: eighty percent of adults think Donald Trump should be focused
Speaker 4: on the economy and inflation. Only twenty nine and thirty
Speaker 4: six percent believe he is prioritizing these issues respectively. So
Speaker 4: what's the point tomorrow night? It's going to be a big,
Speaker 4: long speech, a big performance, But what are the messages
Speaker 4: that Donald Trump actually needs to land Having spent a
Speaker 4: lot of time talking about tariffs and geopolitics the last
Speaker 4: couple of weeks, our messaging experts are with us, and
Speaker 4: by that I mean our signature political panel. Genie Schanzeno
Speaker 4: was here, Bloomberg Politics contributor, Democratic analyst, and political science
Speaker 4: professor at Iona University. And there's Rick Davis, a Republican strategist,
Speaker 4: Bloomberg Politics contributor and partner at Stone Court Capital.
Speaker 3: Rick, what is the job for Donald Trump tomorrow night?
Speaker 4: He's going to have to get a message that you
Speaker 4: can fit on a bumper sticker somewhere.
Speaker 3: What should it be?
Speaker 10: Well, his messages don't come bumper sticker already. In fact,
Speaker 10: his speeches tend to go well over an hour, tough
Speaker 10: to fit on a bumper sticker, And I anticipate he's
Speaker 10: going to use all the time that he needs to.
Speaker 8: Make this speech.
Speaker 10: The reality is in the past, when he was president,
Speaker 10: we have a lot to learn from. He was spending
Speaker 10: a lot of time on these kinds of speeches, trying
Speaker 10: to get Congress to do what he wants him to do. Right,
Speaker 10: And for the first two years it was his agenda,
Speaker 10: I want, you know my text cuts passed, and then
Speaker 10: he had a victory lap over his tax cuts getting
Speaker 10: passed in his speech. And then in the second two
Speaker 10: years he had Democrat control and it was you know,
Speaker 10: a bunch of socialists, and you need to do what.
Speaker 8: I tell you to do.
Speaker 10: I don't think he thinks he needs Congress anymore. I
Speaker 10: think this speech is going to be all about what
Speaker 10: he's doing as president. I don't think he really thinks
Speaker 10: Congress is a player. And I'm I'm leveling tariffs, I'm
Speaker 10: creating all kinds of economic activity. Look at all these
Speaker 10: commitments I'm getting from Apple and others to you know,
Speaker 10: build off our technical infrastructure. I think it's going to
Speaker 10: be more what he's doing for the country than what
Speaker 10: he needs Congress to do for him.
Speaker 4: Amazing, Genie, what's your thought on tomorrow night here? Does
Speaker 4: he need to make an announcement that coincides with the
Speaker 4: numbers we're talking about here? Does he need to get
Speaker 4: more focused on the issue of inflation or is it
Speaker 4: going to sound like the most recent speech we heard
Speaker 4: from Donald Trump.
Speaker 6: Yeah, it's always hard to predict with Donald Trump, which
Speaker 6: is what is going to make it fascinating. But I
Speaker 6: do think that to your discussion of that CBSU Gov poll,
Speaker 6: we saw similar results from a CNN and an NPR
Speaker 6: poll that also came out in the last twenty four
Speaker 6: to forty eight hours, and just the signs of the
Speaker 6: economy and consumer confidence, there are signs of sort of
Speaker 6: blinking yellow going into red. Whether you're looking at public
Speaker 6: opinion on the Trump presidency arguably only six weeks in,
Speaker 6: so it's still early, and also the economy itself, and
Speaker 6: I think Donald Trump and his team are going to
Speaker 6: have to take those things very seriously. There is a
Speaker 6: danger not just with the Trump administration but all presidents.
Speaker 6: They overread mandates. And the reality is he did win
Speaker 6: the popular vote and he won the electoral college, but
Speaker 6: he didn't run away with it. He lost Senate seats
Speaker 6: in some key states that Republicans should have won. And
Speaker 6: so what did the American public elected to do? They
Speaker 6: elected him to make them feel better about the economy.
Speaker 6: We all remember Joe Biden's economy. The numbers weren't bad,
Speaker 6: but people weren't feeling it. We elected Donald Trump he
Speaker 6: was gonna make us feel better. You look at those
Speaker 6: polls most taken before the debacle in the White House
Speaker 6: on Friday, and people aren't feeling better, and by large
Speaker 6: numbers are saying he's not focused on what we elected
Speaker 6: him to do. And so that's what I think he
Speaker 6: should talk about. He's not going to listen to me, though, Joe,
Speaker 6: so who knows what he talks about. But that's what
Speaker 6: I think he needs to talk about.
Speaker 4: Well, I'll be curious to hear from both of you
Speaker 4: on the way Democrats are handling this. I guess Senator
Speaker 4: Chris Murphy is suggesting that he might actually skip the speech,
Speaker 4: and there could be some boycotting, but there's been more
Speaker 4: of an effort in the party to bring guests who
Speaker 4: have been affected by Trump policies. So get ready to
Speaker 4: see a lot of laid off federal workers showing up
Speaker 4: with lawmakers and doing interviews. Here Elizabeth Warren just right
Speaker 4: in front of me. I just popped into my email
Speaker 4: by announced to she's going to be bringing Doug Kowaluski
Speaker 4: of Wellesley will be there, a former National Science Foundation employee. Rick,
Speaker 4: Is this a good strategy? Does anybody care?
Speaker 10: You know, it's hard to tell whether or not the
Speaker 10: public is really feeling the pinch on these job losses.
Speaker 10: You know, the pulling is a little bit all around.
Speaker 10: I think nine times out of ten when you hear
Speaker 10: stories about individuals who are particularly affected by this, I
Speaker 10: think it has the potential for the public to get aroused.
Speaker 10: But I think if it's just thousands of people fired
Speaker 10: today through DOGE, I think there's an attitude that the
Speaker 10: government's too big. It's part of what fueled Trump's victory
Speaker 10: and that he's finally doing something about it. And unless
Speaker 10: it's specific to an individual, it's kind of hard to
Speaker 10: get your head around thousands of people being fired at
Speaker 10: any given time. So I do think the democratic strategy
Speaker 10: of sort of identifying stories and trying to get those
Speaker 10: stories out may be worthwhile, but at the end of
Speaker 10: the day, the momentum is all on Trump side. I mean,
Speaker 10: what's creating of activity is going to be hard to
Speaker 10: fit into one night's speech, right, I mean, we've never
Speaker 10: had a president in my time get this much done
Speaker 10: in this short period of time, and now.
Speaker 3: He's going to talk all about it.
Speaker 8: Well, we're going to be in for a long night.
Speaker 4: There's a New York Times story that you probably saw today, Genie.
Speaker 4: By the way, the White House did react to the
Speaker 4: Washington Post story on Democrats bringing guests in the form
Speaker 4: of laid off federal workers. Quote Democrats exploiting the American
Speaker 4: people for political points, is what the White House said.
Speaker 4: And you can weigh in on that if you want, Genie.
Speaker 4: The fact the matter is you start talking about what
Speaker 4: the Doge has accomplished, and I'm sure a lot of
Speaker 4: the speech will be aimed at that. The group claiming
Speaker 4: credit for canceling procurement agreements that had been completed years earlier.
Speaker 4: Another in a string of public errors on its receipts website,
Speaker 4: they start kind of promoting big cuts, only to find
Speaker 4: out in this case that there was a Coastguard contract
Speaker 4: track signed in the Bush George W. Bush administration, and
Speaker 4: it was completed by two thousand and five, twenty years past,
Speaker 4: and we're still talking about this. Does Donald Trump have
Speaker 4: enough to actually take credit for?
Speaker 6: You know, I think the reality is is the cutting
Speaker 6: the federal government cleaning it up is popular. But what
Speaker 6: is happening now is a really ill conceived execution of
Speaker 6: a very popular mandate, and that will catch up with them.
Speaker 6: I mean, that's what the New York Times story was about,
Speaker 6: you know, Elon Musk. And big question for tomorrow night, Joe,
Speaker 6: does Elon Musk come They're demanding that four time president
Speaker 6: wear a suit. I'd like to see a demand that
Speaker 6: Elon Musk wear one. If that's the case. Does he
Speaker 6: get that pushback? Is he sitting with the first Lady?
Speaker 6: All kinds of questions about Elon Musk? And he did rightly.
Speaker 6: So we're going to make a lot of mistakes during
Speaker 6: that cabinet meeting, and boy have they. No, there aren't
Speaker 6: tens of millions of people dead. You know, you're not
Speaker 6: going to be able to save eight billion dollars on
Speaker 6: some of these contracts. We didn't send fifty million dollars
Speaker 6: worth of condoms. You know, all of this they have
Speaker 6: had to walk back, and that just speaks to the fact,
Speaker 6: as does the New York Times piece that execution matters.
Speaker 6: And I think what Democrats need to do, beyond bringing
Speaker 6: people personally impacted by these cuts to the speech, is
Speaker 6: they need to talk about the reality of the numbers.
Speaker 6: What even if Elon Musk is wildly popular, none of
Speaker 6: this matters with a seven trillion dollar spend and sixty
Speaker 6: percent of that going to mandatory programs like Social Security, Medicare,
Speaker 6: and Medicaid, which they've taken off the cuts list. So
Speaker 6: the reality is their numbers don't add up. They never
Speaker 6: have and until they do, they can talk about this
Speaker 6: all they want, but at some point the American people
Speaker 6: are going to say, wait a minute. Causing people a
Speaker 6: lot of pain for very little gain, and that is
Speaker 6: a problem, and that's what the Democrats really need to
Speaker 6: focus on.
Speaker 10: Rick.
Speaker 4: What does Donald Trump do with Elon Musk tomorrow? I
Speaker 4: do they give him a special seat like up near
Speaker 4: the Supreme Court? I do maybe you get a couple
Speaker 4: of the doge bros. They get their own bench set
Speaker 4: up there. Does he go as a guest of a lawmaker.
Speaker 3: What do you expect?
Speaker 10: Yeah, normally, you know, the stories that the President talk
Speaker 10: about are sitting up with the first Lady in the balcony.
Speaker 10: I can't see Elon Musk in the balcony.
Speaker 3: No, but he's not.
Speaker 10: An official, he's an advisor. I mean, they make pains
Speaker 10: to try and twist themselves into pretzels to figure out
Speaker 10: what Elon Musk is. Uh, And so yeah, it'll be
Speaker 10: interesting to see physically what happens to Elon Musk. I mean,
Speaker 10: for if we really, you know, transpose his power, he'd
Speaker 10: have a third seat sitting behind you know, Donald Trump,
Speaker 10: with the speaker and the majority of leader of the Senate.
Speaker 10: I mean, it's it's going to be kind of an
Speaker 10: interesting side show. But the reality is, I'm sure he'll
Speaker 10: talk a lot about it because that is where the
Speaker 10: action is right now in the Trump administration. Things are happening,
Speaker 10: Elon's making moves. Very hard for Democrats to sort of
Speaker 10: figure out how to juxtapose it. I think that what
Speaker 10: Genie was just talking about is ultimately the problem. I
Speaker 10: don't think anybody's going to really get excited about it
Speaker 10: from a popular point of view until they start calling
Speaker 10: the VA and don't get their calls back, or they
Speaker 10: can't get an appointment for an MRI at a hospital.
Speaker 8: I mean, like there are going to be net effects
Speaker 8: of this.
Speaker 10: Maybe we do have a bloated government and maybe none
Speaker 10: of these firings make that bit of difference, but if
Speaker 10: they do, that's when people will start to react.
Speaker 4: Genie, Producer James's just designated survivor Elon Musk.
Speaker 3: Maybe we don't see.
Speaker 4: Him at all tomorrow night because he's holed up in
Speaker 4: an undisclosed location. I've only got a minute left, Genie.
Speaker 4: Senator Slotkin's got a tough job. It's like the worst
Speaker 4: job in the world doing the response, no matter which
Speaker 4: party you're in.
Speaker 3: Does she make it work.
Speaker 4: Tomorrow night and not end up being something we're talking
Speaker 4: about as a fail the next day?
Speaker 6: Yeah? Please, James, can we have Keefer Sutherland be the
Speaker 6: designated survivor? That's what we'd all like to see. You know,
Speaker 6: certainly we don't see her in a kitchen. We know
Speaker 6: that we don't see her reaching for a lot of water.
Speaker 6: It is a very tough speech. She is really really
Speaker 6: well well situated to give it. This is somebody with
Speaker 6: a national security background. She is from a swing state.
Speaker 6: She is you know, popular among moderates. You know, I
Speaker 6: think she is a very good shot. But it is
Speaker 6: a tough gig either way around. But yeah, bring Keifer
Speaker 6: Sutherland back please, all right, I.
Speaker 3: Think we've got a lot done here in this conversation.
Speaker 4: Jeanie Shanzano and Rick Davis ready to play on a Monday.
Speaker 3: This is Kingbery. Thanks for listening to the Balance of
Speaker 3: Power podcast.
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