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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: Joining us from the White House is the National Economic

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Speaker 2: Council Director Kevin has Sick. Kevin, welcome to the program sir.

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Speaker 2: It's good to catch up with you once to get

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Speaker 2: it's great to be back. I want to say, first

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Speaker 2: of all, Kevin, congratulations on the new seat. You know,

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Speaker 2: the NAC has a storied history going back to the nineties,

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Speaker 2: including Bob Ruben and Glenn Hubud.

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Speaker 1: I know, you know all of that.

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Speaker 2: I just want to take a step back, get away

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Speaker 2: from the numbers we've got in front of us just now,

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Speaker 2: and think about the last few years.

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Speaker 1: What kind of labor market you and the team inheriting Oh,

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Speaker 1: you know.

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Speaker 3: I first also want to say thank you. It's great

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Speaker 3: to be back at Bloomberg, and thank you for the congratulations.

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Speaker 3: And you're right, if you look at the people who've been,

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Speaker 3: you know, in the office I I'm in now, like

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Speaker 3: even Leil Brader before, I'm kind of humbled to be there.

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Speaker 3: I also want to say thanks for leading off with

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Speaker 3: Mike McKee. I've been watching him do jobs stuff for

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Speaker 3: like twenty years and I always want to hear what

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Speaker 3: he has to say. I'm sure he had a couple

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Speaker 3: of things out there that I hadn't noticed in the release,

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Speaker 3: So that's great too. To be back, I would say

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Speaker 3: that the big headline for me is something that you

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Speaker 3: guys haven't talked about yet but I had encourage you to,

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Speaker 3: is that we've got this thing going on where the

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Speaker 3: professionals at the BLS keep revising down the data. And

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Speaker 3: so the headline for me when I'm looking at this

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Speaker 3: is that it was the biggest downward division. You know,

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Speaker 3: the benchmark goes through last March, the biggest downward division

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Speaker 3: since two thousand and nine. And we're still sifted through

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Speaker 3: the numbers, but you know, it's really really big. It

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Speaker 3: could be as much as if you go a little

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Speaker 3: bit beyond the month of the last month, it could

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Speaker 3: be as much as a million jobs fewer than we

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Speaker 3: thought after this benchmark revision. And so the thing is

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Speaker 3: that why is it that we keep seeing sort of

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Speaker 3: positive jobs numbers and then when we look back a

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Speaker 3: year later, it's way worse than we thought. And so

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Speaker 3: I say that what we learned with all these outward

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Speaker 3: divisions is that the Biden economy, the Biden jobs market,

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Speaker 3: was way worse than market slot, and that's sort of

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Speaker 3: consistent with the rest of our views that their policies

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Speaker 3: were wise and there's a whole lot of cleaning up

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Speaker 3: to do. And I think that if you look at

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Speaker 3: ism that just came out, the people market participants believe

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Speaker 3: that President Trump is going to be able to turn

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Speaker 3: things around, and with these big downward divisions, we can

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Speaker 3: see that there's actually a lot of work to do.

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Speaker 2: So, Kevin, that's your opinion on the state of affairs.

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Speaker 2: I want your view on the policy mat set, and

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Speaker 2: I want to get a bigger pitch of you as well,

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Speaker 2: because I think your approach is getting lost in the

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Speaker 2: trade headlines. The fuller approach is getting lost in the

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Speaker 2: trade headlines of the last week or so. Can I

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Speaker 2: ask you how your tax plan might complement the trade effort,

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Speaker 2: how these two things might.

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Speaker 3: Chowt Well, it's obviously you know President Trump's tax plan

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Speaker 3: working together with congressional leaders. You know, we had the

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Speaker 3: a team meeting together in the White House yesterday, including

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Speaker 3: meeting with the President the Vice President to talk with

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Speaker 3: the top House members about exactly what they want to

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Speaker 3: see in the reconciliation package and finally the bill. And

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Speaker 3: you know, in politics, there's always going to be a

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Speaker 3: work in progress, but I can tell you that President

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Speaker 3: Trump has assembled the very best possible team to negotiate

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Speaker 3: with Congress and make sure that they can be successful.

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Speaker 3: And you've seen some of the news from that, and

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Speaker 3: I think the headline news as the President has stated,

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Speaker 3: as he always does exactly what he wants. That's not

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Speaker 3: like just negotiation, that's what he wants, and the people

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Speaker 3: in the House were able to work with it. And

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Speaker 3: now it looks like there's a lot of positive momentum

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Speaker 3: after they met with the president.

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Speaker 2: So Kevin just going through the list of things that

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Speaker 2: the President wants, and of course you know them well,

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Speaker 2: but for the benefit of our audience, that might just

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Speaker 2: be joining us sure, ending taxes on tips and overtime,

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Speaker 2: newcuts for made in America products, extend TCJA from twenty seventeen,

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Speaker 2: expand the state and local tax deduction.

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Speaker 1: There's a lot there.

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Speaker 2: One of the offsets was to end the carried interest loophole,

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Speaker 2: which was a little bit of a surprise. There's another

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Speaker 2: offset as well, potentially in the mix. And this is

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Speaker 2: where the trade story fits in. And i'd love you

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Speaker 2: view on things. Kevin what is the objective of the

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Speaker 2: trade approach, because in the first term it was about reciprocity,

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Speaker 2: and the administration at the time, and Larry Kudler was

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Speaker 2: in your position, made a pretty forceful argument to say

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Speaker 2: where in X and shine is not following cup, they

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Speaker 2: need to do more. That all makes sense. Now, it's

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Speaker 2: about national security, the southern border, it's about drugs, it's

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Speaker 2: about potential revenue rising as well.

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Speaker 1: Which one is it, Kevin? Can it be all of

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Speaker 1: the above? Oh?

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Speaker 2: You know.

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Speaker 3: The bottom line is the first time I ever met

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Speaker 3: the president, right at the beginning of twenty seventeen, that

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Speaker 3: one of our first discussions about trade policy was about reciprocity.

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Speaker 3: And so one hundred percent that's going to be a

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Speaker 3: key key factor in President Trump's thinking and his team's

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Speaker 3: workouts from his thinking as we work forward, and when

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Speaker 3: you think about, well, what is reciprocity, how should we

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Speaker 3: think about it? Then a lot of people focus on tariffs, tariffs, tariffs,

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Speaker 3: And if we look at just tariffs, then you'll see

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Speaker 3: that our trading partners tend to have tariffs that are

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Speaker 3: two or three times higher than our tariffs, and so like,

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Speaker 3: if we were going to be reciprocal, then they could

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Speaker 3: come down or we could go up, but it would

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Speaker 3: be a lot different trade policy. But the way I

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Speaker 3: like to think about it is just think about the

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Speaker 3: the fact that we have a tax system in the

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Speaker 3: US that's fundamentally different than the tax systems everywhere else

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Speaker 3: in the world. And so I had my guys a

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Speaker 3: couple of days ago just update the numbers I always

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Speaker 3: look at, and we found that US multinationals had paid

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Speaker 3: foreign governments three hundred and seventy billion dollars in taxes

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Speaker 3: because of value added taxes and income taxes in twenty

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Speaker 3: twenty three, and foreign multinationals operating in the US paid

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Speaker 3: the US government only fifty seven billion in taxes, and

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Speaker 3: so they have three times the GDP we do. You know, globally,

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Speaker 3: we're about a quarter of GDP and we're paying three

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Speaker 3: hundred and seventy billion and they're paid fifty seven billion.

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Speaker 3: And that's not reciprocal. That's something fundamentally different. And what

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Speaker 3: President Trump wants us to do is to come up

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Speaker 3: with a really smart program that includes trade policy, tariffs,

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Speaker 3: and revisions to the tax code, and he wants us

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Speaker 3: to make it work so that America's on a level

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Speaker 3: playing field again. And the reason he wants to do

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Speaker 3: that is not because of the numbers. It's because of

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Speaker 3: the people, the people in America who don't have jobs,

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Speaker 3: because we're paying three hundred seventy billion dollars a year

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Speaker 3: in taxes to foreign governments in order to incent our

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Speaker 3: companies to not create.

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Speaker 1: Jobs here but create jobs overseas.

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Speaker 2: Vint Old of the president, it sounds like you're talking

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Speaker 2: about Europe.

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Speaker 1: What's the ask of the Europeans.

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Speaker 3: The President is going to negotiate with Europeans. He's going

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Speaker 3: to negotiate with everybody, and at the time when he

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Speaker 3: does that, you'll find out what hiss asked. Are specifically us.

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Speaker 2: Some situations more negotiable than others. We've seen already. You

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Speaker 2: put the threat on the likes of Canada and Mexico.

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Speaker 2: Mexico provided some concessions. We saw the same thing from Colombia.

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Speaker 2: It's the approach to Europe going to be any different.

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Speaker 3: I mean one hundred percent. What happened over the last

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Speaker 3: week wasn't a trade war. Why would you have a

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Speaker 3: trade war with your neighbors you trade with so much.

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Speaker 3: It was a drug war because ninety thousand people died

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Speaker 3: a fentanyl because of the fentanyl coming across the borders

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Speaker 3: in Canada and in Mexico. A lot of times the

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Speaker 3: drug from Canada was coming across from the Mexican drug cartels,

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Speaker 3: by the way, and so the Canadians and the Mexicans

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Speaker 3: made a deal with us to make progress on this

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Speaker 3: because it's absolutely unacceptable that more people die from that

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Speaker 3: poison than from the Vietnam War in one year. And

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Speaker 3: so we just had a discussion about how are we

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Speaker 3: going to win the drug war, and that's what happened.

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Speaker 1: Then.

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Speaker 3: You know, I'm not aware of, nor have I been

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Speaker 3: informed of, you know, massive fentanels shipments from Europe, and

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Speaker 3: so the discussions we have with Europe will be about

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Speaker 3: other things.

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Speaker 4: So it sounds like you want to do revenue raising

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Speaker 4: on more terrorists potentially when it comes to Europe. Does

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Speaker 4: that need to happen before the tax bill or is

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Speaker 4: the president willing to expand the deficit?

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Speaker 3: Kevin, the President is negotiating the parameters of the tax

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Speaker 3: bill as we speak with members of Congress, and he's

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Speaker 3: you know, asked the Treasury Secretary and me, the Director

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Speaker 3: of the National Economic Council, to meet regularly with leaders

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Speaker 3: of the House of the Senate and to see what's

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Speaker 3: possible and what's right and good and should happen, and

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Speaker 3: to get them as close to exactly the same thing

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Speaker 3: as possible. And that's what we're going to do.

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Speaker 4: With Kevin, as you know, how do you, guys, Republicans

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Speaker 4: and Congress are not on the same page. He spent

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Speaker 4: a lot of time with members of Congress yesterday, but

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Speaker 4: he's going to have dinner this evening with senators. Do

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Speaker 4: you have a sense of what the President prefers at

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Speaker 4: this moment one or two bills when it comes to

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Speaker 4: Congress enacting his legislative agenda.

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Speaker 3: The President is going to work that out with them,

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Speaker 3: and he's talking to everybody. I know that there are

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Speaker 3: different opinions on the Hill, and we'll see what happens.

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Speaker 2: You also know, Kevin, that confidence coming into twenty twenty

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Speaker 2: five from Corporate America is sky high. Sentiment is ready

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Speaker 2: robust as strong. You know that the President does we

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Speaker 2: all know that here on Wall Street? Is there a

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Speaker 2: risk that you scor onto that confidence? That confidence doesn't

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Speaker 2: translate into action into hiring into Capex without clarity on

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Speaker 2: a trade story.

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Speaker 1: I think that.

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Speaker 3: We're a couple weeks in and we've made an enormous

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Speaker 3: amount of progress. Where I look, people are saying, how

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Speaker 3: could you guys possibly get so much done in such

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Speaker 3: little time? And the thing that I can promise markets

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Speaker 3: and you guys, and you'll probably be back next week

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Speaker 3: with you to talk about more things that we're gonna

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Speaker 3: This piece of progress is not gonna slow. It's not

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Speaker 3: gonna slow at all.

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Speaker 2: Kevin stand touch, looking forward to coming in the next

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Speaker 2: four years with you. Thank you, sir. I appreciate your time.

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Speaker 1: I will too.

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Speaker 2: Kevin has said that the National Economic Council Director on

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Speaker 2: the latest jobs report and a little bit of an

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Speaker 2: outlook there on the policy changes you might expect from

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Speaker 2: the incoming administration, the new administration under the President Donald Trump,