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Speaker 1: Live from our nation's capital. This is Bloomberg sound On

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Speaker 1: talking about a huge issue here is investment in marginalized communities.

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Speaker 1: They want to deconstruct this package and cherry pick what

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Speaker 1: they like what they don't like. China is surgeon powered

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Speaker 1: with major investments. Bloomberg sound On, the insiders, the influencers,

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Speaker 1: the insides. Fiden has promised again and again he will

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Speaker 1: unite the country. Who do you think Fiden has to

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Speaker 1: watch in terms of moderate defectors. Infrastructure has always been

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Speaker 1: by part of the Bloomberg sound On on Bloomberg Radio.

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Speaker 1: I'm Ben Baine, joined by Bloomberg Politics contributor Rick Davis.

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Speaker 1: Coming up on the show today, We're going to talk

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Speaker 1: about the global pandemic and the politics around the US

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Speaker 1: push to vaccinate more Americans and reopened businesses from Wall

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Speaker 1: Street to Main Street. We're going to get the latest

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Speaker 1: on the White House is Big infrastructure plan. We're also

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Speaker 1: gonna talk about some drama in the House Republican Caucus

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Speaker 1: over Liz Cheney and her ongoing clash with former President

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Speaker 1: Donald Trump. And later in the show, we're gonna have

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Speaker 1: Alison Herron Lee, a Democratic Commissioner of the Securities and

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Speaker 1: Exchange Commission. I'm Ben Beging along with Bloomberg Politics contributor

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Speaker 1: Rick Davis, and we're joined on the line by Congressman

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Speaker 1: Blaine luke Meyer. Thanks so much for being here, Congressman.

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Speaker 1: Really appreciate you taking the time. My pleasure, Ben diet

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Speaker 1: it with bit to you this afternoon. So so thanks

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Speaker 1: that you're and you're joining us from Missouri. I understand

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Speaker 1: we represent the third district, that's correct. So you know,

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Speaker 1: I'm really interested to hear what are you hearing from

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Speaker 1: your constituents right now. I got a little recess here.

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Speaker 1: You're you're back home and you're talking to people. What

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Speaker 1: what what's top of mind right now? Well, the two

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Speaker 1: things that I get asked about consistently over the last

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Speaker 1: week that we've been home. Or number one, what are

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Speaker 1: we gonna do about this three and hour check that

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Speaker 1: allows people to stay home and not come to work? Uh?

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Speaker 1: A result that small businesses really are struggling to try

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Speaker 1: and to find enough people to be able to work

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Speaker 1: their businesses, whether it's a restaurant or a manufacturing plan

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Speaker 1: or the or the hardware store on the corner, without

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Speaker 1: people willing to come to work. Uh. You know, they're

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Speaker 1: able to stay home and get you know three just

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Speaker 1: to stay home. Uh, those businesses are struggling, and I

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Speaker 1: think that's gonna not bode well for economic cover here.

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Speaker 1: I think we're gonna be fine, but it's going to

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Speaker 1: a dining stretch out for recovering. The second thing we

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Speaker 1: hear about is this stepped up basis in uh in

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Speaker 1: in inheriting property that the Band administration is talking about eliminating.

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Speaker 1: This is really create a firestorm among my small business

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Speaker 1: people and farmers. I live in a central part of

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Speaker 1: the state and the rural part of my district, and

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Speaker 1: I got a farmer came up to me the other

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Speaker 1: night and he said, Lane, I want to tell you. Look,

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Speaker 1: this is concerning to me. Said, I've I've got. I

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Speaker 1: bought a farm, you know, my farm forty years ago

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Speaker 1: for two dollars an acre, and it's worth six thousand

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Speaker 1: dollars an acre. Now there's no way if something happens

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Speaker 1: to me and this thing is eliminated, that my family

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Speaker 1: can can pay the inheritance tax on this and be

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Speaker 1: able to retain the form. So this is a real concern.

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Speaker 1: And these these are the two things I hear about

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Speaker 1: most about the latest programs from around to the president. So,

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Speaker 1: so you talking about the latest programs from the president,

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Speaker 1: you're talking about small businesses. I mean there are there

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Speaker 1: are a number of things in these infrastructure plans that

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Speaker 1: in theory, would benefit a lot of those small businesses

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Speaker 1: in your district. And you kind of have a have

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Speaker 1: a slice of Americana, right You're talking from the suburbs

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Speaker 1: of St. Louis all the way through the capital into

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Speaker 1: some more rural areas, so you see, you know a

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Speaker 1: lot of your state. Are there things in there that

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Speaker 1: maybe you can work with the White House on. Maybe

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Speaker 1: there's certain points in this these infrastructure plans that you

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Speaker 1: could support. Well, I think the infrastructure part of the bill,

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Speaker 1: which is only nine of this bill or excusing six percent,

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Speaker 1: less than six percent of the bill um, which are

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Speaker 1: roads and bridges and highways and ports and airports things

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Speaker 1: like that. Yeah, you know, I'm just willing sit down

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Speaker 1: and talk with the folks on that, and my guys

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Speaker 1: in my district are certainly interested in talking about that.

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Speaker 1: But the other uh, and how you pay for it

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Speaker 1: is done unacceptable. Uh, they are they're pulling their hair

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Speaker 1: out and tremendously nervous about the direction of this thing

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Speaker 1: because as small businesses, uh, you know, they understand the

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Speaker 1: need for infrastructure and they're supportive of that. They're willing

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Speaker 1: to do what it takes to get that done. But

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Speaker 1: whenever you're you're continuing to allow people to stay home

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Speaker 1: and not come to work so they can actually earn

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Speaker 1: a living, so they can actually get their business up

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Speaker 1: and running, it makes it pretty tough. That's a tough sell.

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Speaker 1: And then whenever you look at the tax structure, you know, um,

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Speaker 1: then there's uh, I'm the ranking member on small business

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Speaker 1: and there's even though the you know, of all the

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Speaker 1: small businesses or escorps, there's still one million sea corps

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Speaker 1: out there that are small businesses. So when you raise

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Speaker 1: the corporate rate by a third, which is what is

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Speaker 1: being proposed, that's a hammer on the on the small businesses.

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Speaker 1: When you raise the individual rate and you double camp

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Speaker 1: games or run camp games through there through their regular

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Speaker 1: um rate, now that is that is another dagger in

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Speaker 1: the heart. And so then you add on top of

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Speaker 1: it the estate tax um you know, reconfiguration of the

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Speaker 1: tax itself, plus elimination of the steptop basis. There's there's

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Speaker 1: a war on small business going on, and they're very,

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Speaker 1: very concerned about this. And you know, while they're supportive

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Speaker 1: of of of infrastructure, true infrastructure, the other of this

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Speaker 1: bill is not something they support. Congressmen, Uh, you know,

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Speaker 1: talking a little bit more about these small businesses, because

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Speaker 1: I think this is the one thing that I keep

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Speaker 1: hearing over and over on Capitol Hill from members I

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Speaker 1: know is that, um, uh, these increases in in corporate

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Speaker 1: rates are going to affect consumers and small business people.

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Speaker 1: And and are you seeing any backlash even within the

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Speaker 1: Democratic Party on some of these I mean, obviously the

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Speaker 1: impact on family farms with this elimination a stepped up basis.

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Speaker 1: I mean, these are all things that have real practical

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Speaker 1: uh and immediate applications that would be very difficult for

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Speaker 1: people who, by President Biden's adminished admission, are the folks

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Speaker 1: he's actually trying to help. And and so do you

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Speaker 1: see a reconciliation happening in the House on some of this?

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Speaker 1: I mean, what will actually wind up making it through

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Speaker 1: like your committee? I don't know. I that's a great question. Uh,

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Speaker 1: And I'm not sure how far they're willing to go.

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Speaker 1: I think I could find a half a dozen Democrats

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Speaker 1: that would be willing to look at just infrastructure and

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Speaker 1: and and and some of this other tax stuff. You know,

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Speaker 1: let it go away. But unfortunately AOC and companies seem

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Speaker 1: to be running the the party over there, and you know,

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Speaker 1: to the extent that if you don't go along with them,

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Speaker 1: they go find a primary can just trying to take

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Speaker 1: you out. Um. You know, for instance, I think, um,

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Speaker 1: something like this, this state tax a steptop basis on

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Speaker 1: the estate tax up. I think that's something we could

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Speaker 1: probably get rid of. Uh. You know, the Family Business

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Speaker 1: Estate Tax Coalition estimate that eight hundred thousand jobs will

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Speaker 1: be lost over ten years and a hundred thousand a

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Speaker 1: year after that. It costs thirty CUSS workers thirty two

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Speaker 1: dollars for hundred dollars revenue. RAYS is going to cost

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Speaker 1: about ten billion dollars in GDP. This is a non starter,

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Speaker 1: and I think many many Democrats would be willing to

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Speaker 1: look at that and say, no, no, this, this can't

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Speaker 1: happen because many of them are small businesses owners to

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Speaker 1: they've got family members are small business owners, and the

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Speaker 1: inability to pass on a small business to to your

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Speaker 1: level ones. Um, is going to crush the small business

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Speaker 1: of this country. And guess who's the beneficiary of all

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Speaker 1: that Just the big businesses. So this is this is

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Speaker 1: a big business bill through and through. They don't care

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Speaker 1: about the raising the corporate tax on themselves because they

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Speaker 1: pass those taxes along. Small businesses aren't able to do that.

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Speaker 1: So what does this have to And this this is

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Speaker 1: why the three years part of the pandemic, whenever we

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Speaker 1: cut taxes and cut regulation, were so impactful because they

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Speaker 1: gave us a template on how to generate economic economic activity.

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Speaker 1: If you turn that around now and you take money

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Speaker 1: away from the small businesses that they were investing in

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Speaker 1: new new equipment and new planet uh expansion and new employees.

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Speaker 1: If you stop that, you're going to stop that hiring

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Speaker 1: them new employees. You're gonna stop that expansion of the

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Speaker 1: business and stop that, you know, adding the new equipment

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Speaker 1: in your business. And so this is really really harmful.

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Speaker 1: Um And if you increase regulation, it takes money to

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Speaker 1: comply with regulations, and so again that's another hit. And

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Speaker 1: small businesses have very little room to to to work

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Speaker 1: as compared to what the big car part of that

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Speaker 1: and part of the part of the what the White

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Speaker 1: House is is saying here, though, is that these these

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Speaker 1: programs are focused on creating jobs for smaller businesses. It

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Speaker 1: sounds like you're saying, essentially that the tax element completely

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Speaker 1: outweighs any of these new infrastructure programs that are going

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Speaker 1: to be developed. The administration and some of your Democratic

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Speaker 1: colleagues are are seeings quite differently. I mean, there there

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Speaker 1: is you know, saying that ultimately the programs and the

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Speaker 1: money that's going to go towards building new infrastructure, be

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Speaker 1: it the traditional UM roads and bridges or other types

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Speaker 1: of UM programs, are going to create a number of

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Speaker 1: new industries, let alone new jobs. So it sounds like

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Speaker 1: you're saying that the tax repercussions outweigh those new jobs.

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Speaker 1: From what you're hearing from your constituents, yeah, so very significantly.

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Speaker 1: I mean I I still have yet to see an

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Speaker 1: estimate of the new jobs on their infrastructure bill. Uh,

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Speaker 1: there isn't one out there. They talk about there's going

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Speaker 1: to create jobs, but they can't put a number on it.

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Speaker 1: So there's a really current jobs. I can tell you.

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Speaker 1: The tax part of this bill is going to it's

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Speaker 1: going to cost jobs. There is no doubt about it.

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Speaker 1: Whenever we after at last three years, three years for pandemic.

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Speaker 1: At the end of that time, we had one point

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Speaker 1: two million more jobs and don't have people to fill them.

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Speaker 1: Where are we now? Now We've got we're paying people

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Speaker 1: to stay home when we actually could use them in

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Speaker 1: the workforce. And we're going to get ready to tax

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Speaker 1: the small businesses who aren't able to make a living

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Speaker 1: because people are not not not working in their factors

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Speaker 1: or the restaurants, and now you're gonna slap a tax

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Speaker 1: on them. This is this is going to be the

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Speaker 1: death nail for a lot of a lot of small businesses.

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Speaker 1: They just can't survive when you're getting hit from both

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Speaker 1: sides like this. Yeah, Congressman, I think the point you're

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Speaker 1: making has been made actually even in the previous administration.

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Speaker 1: I remember Senator Lindsey Graham, my good friend, argued with

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Speaker 1: the Trump administration about the nine text to stay home

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Speaker 1: and not work and and and now we've whittled a

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Speaker 1: number down a bit, uh and and and it is

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Speaker 1: this management of the family and their needs versus what um,

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Speaker 1: what we want to do to spur employment. And we

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Speaker 1: do see uh, new employment numbers exactly what you just described,

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Speaker 1: saying that we actually need people to go back to work,

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Speaker 1: that jobs and manufacturing and the service industries are going

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Speaker 1: on filled, and so maybe the administration I'll be looking

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Speaker 1: for ways to try and employ people, um without without

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Speaker 1: having them stay at home on a government doll Well,

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Speaker 1: thanks a lot for joining us, Congressman Blaine luke Meyer.

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Speaker 1: We appreciate you being here with us. I'm Ben Bain.

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Speaker 1: Coming up. We are going to talk a bit more

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Speaker 1: about the White House's plans and also talk a little

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Speaker 1: bit about today. You heard that we heard the President

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Speaker 1: speaking about the coronavirus pandemic, and we're going to get

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Speaker 1: into some other issues as well that are catching everyone's

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Speaker 1: attention here in Washington. I'm Ben Baine. This is Bloomberg

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Speaker 1: and I'm Ben Bain, along with Bloomberg Politics contributor Rick Davis,

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Speaker 1: and we're joined by Laura Fink, Democratic strategists and founder

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Speaker 1: and CEO of A Bell Communications. As we were talking

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Speaker 1: about earlier, we're gonna be delving a bit into what

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Speaker 1: the White House is planning to do and really grapple

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Speaker 1: with into the next phase of its plan to deal

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Speaker 1: with the COVID pandemic. President by it in today speaking

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Speaker 1: at the White House, basically announcing a new three pronged approach.

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Speaker 1: He says it's going to help America move into the

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Speaker 1: next phase. Here he laid out a plan to consider

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Speaker 1: ways to potentially vaccinate children once the FDA approves that

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Speaker 1: make it more convenient for people to get vaccinated, including

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Speaker 1: by introducing a new website. And finally, and probably most importantly,

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Speaker 1: and we're gonna get into this with our panelists here

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Speaker 1: convincing Americans who are still hesitant to get vaccinated to

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Speaker 1: want to go ahead and take the jab here sound

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Speaker 1: on that as we anticipated, the pace of vaccination is

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Speaker 1: slowing out of the majority of American adults have already

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Speaker 1: gotten their first shot, but we're still vaccinating millions of

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Speaker 1: America's every day. So, Rick, Laura, we heard from President

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Speaker 1: Biden today, and you know, I have to say, I

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Speaker 1: mean the United States. You look at the rest of

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Speaker 1: the world in many ways where we're way ahead of

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Speaker 1: where really every other country in the world is. Right now,

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Speaker 1: there's discussions about how to get some of these vaccine

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Speaker 1: to the rest of the world. But are we hitting

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Speaker 1: an inflection point here? You heard it a little bit

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Speaker 1: from the President today where there's concerned that at a

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Speaker 1: certain point everyone who has gotten a shot at the

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Speaker 1: people who want shots, and now it really comes to

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Speaker 1: convincing them. Rick, can you can you talk about that

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Speaker 1: a little bit? What do you think? Sure? Look, I mean,

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Speaker 1: obviously they are addressing the issue that remains, which is

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Speaker 1: trying to get the harder half of the population with

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Speaker 1: a vaccine rather than the easy half, which was people

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Speaker 1: willing to go and stand in line and a mass

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Speaker 1: vaccination site. As those closed down and a lot of

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Speaker 1: mare this month even uh, and they're closing down not

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Speaker 1: because uh, the run out of vaccine or anything like that,

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Speaker 1: it's just running out of people who will show up

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Speaker 1: at those locations. So I think it's actually smart policy

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Speaker 1: to start making more of a public campaign around the

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Speaker 1: need to get vaccinated, to you know, get your vaccinations

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Speaker 1: because it's good for your neighbors, get your vaccinations because

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Speaker 1: it's good for your employer, you know. I mean, there

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Speaker 1: are a lot of different ways to to sell it,

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Speaker 1: but it's important that they make these things as readily available.

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Speaker 1: And I think having these pharmacies where you know you're

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Speaker 1: walking into a pharmacy or a grocery store and you

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Speaker 1: can get vaccinated right then and there. Uh is really

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Speaker 1: going to help keep the momentum up. It's starting to

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Speaker 1: tail off a little bit now, although daily averages of

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Speaker 1: about two and two and a half two point two

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Speaker 1: million are still happening. The expectation is it will decline

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Speaker 1: and and and Laura, I mean, one of the highest

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Speaker 1: marks that President Biden gets so far. As for his

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Speaker 1: handling of the this pandemic. Uh, there are a couple

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Speaker 1: of polls out recently which showed him well over sixty

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Speaker 1: of Americans approving of how he handled this. Do do

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Speaker 1: you think that there's a political risk here for the

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Speaker 1: White House that as we start to get into the

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Speaker 1: people who are reluctant, Uh, you know, maybe Uh, there

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Speaker 1: there's a need to to also kind of think about

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Speaker 1: the politics here because he has been so popular. This

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Speaker 1: administration has drawn a lot of its popularity from it's

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Speaker 1: handling up the coronavirus so far. Well, I don't know

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Speaker 1: that anyone that'svaccine hesitant, UH is necessarily necessarily going to

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Speaker 1: punish Joe Biden for advertising the vaccine. And I agree

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Speaker 1: with Rick that we need to see a centralized effort

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Speaker 1: to advertise and to talk about the benefits and to

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Speaker 1: sort of reach those populations that maybe just need more information.

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Speaker 1: I think you also have to go in with trusted sources,

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Speaker 1: So you know, people's employers, people people, we've got to

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Speaker 1: do some Hollywood stuff, we've got to do, you know,

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Speaker 1: people's later union, people's church. All of these could be

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Speaker 1: trusted uh sponsors of the vaccine or for information and encouragers.

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Speaker 1: And you know, but to your point about partisanship, one

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Speaker 1: of the most vaccine hesitant groups is as we know,

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Speaker 1: in the Republican circles, particularly people that support Donald Trump

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Speaker 1: UM and within those groups, particularly men, and within that group,

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Speaker 1: particularly men that identify as masculine as you see themselves,

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Speaker 1: those particularly masculine. You look at that data and you've

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Speaker 1: got to say, Okay, how do we go ahead and

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Speaker 1: make sure that we persuade these people. So we've got

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Speaker 1: to get some some trusted people that those individuals and

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Speaker 1: groups may be persuaded by. And I don't think we've

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Speaker 1: seen a lot of that. Is that the next phase here?

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Speaker 1: You think, what's that that's the next phase here? You

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Speaker 1: think that you think the White House the next phase?

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Speaker 1: I would you know, I heard Frank Munths talk about it,

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Speaker 1: you know, same Republican polsters, saying, we've got to find

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Speaker 1: a way to penetrate um this this this problem because

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Speaker 1: we know that her immunity is up there at eight percent.

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Speaker 1: We're nowhere near that. We don't know if we'll get there.

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Speaker 1: But the closer we get, the better off we are,

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Speaker 1: and the easier it will be to handle smaller outbreaks

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Speaker 1: of this virus as it continues to morph in and

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Speaker 1: to become more spread herble and uh and and in

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Speaker 1: terms of thinking about what the next phase might be,

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Speaker 1: is this something that comes from the White House or

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Speaker 1: is this something that that actually is going to need

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Speaker 1: to come from you mentioned Hollywood be for is is

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Speaker 1: this is this a civic society kind of effort? What

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Speaker 1: do you think, Rick? Yeah, I think this should be.

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Speaker 1: I think, you know, the Biden administration she used their power,

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Speaker 1: you know, to pull together people from every walk of

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Speaker 1: life to be able to push out this message of

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Speaker 1: go get a shot. Well, thanks a lot. We're we'll

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Speaker 1: be back in just a few moments. We're gonna switch

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Speaker 1: gears a little bit and continue our conversation with Bloomberg.

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Speaker 1: Politic distributor Rick Davis and Laura Fink and talk about

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Speaker 1: some drama simmering in the Republican House Caucus. This is Bloomberg, Rick, Laura,

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Speaker 1: I know you've all been waiting to delve into this one.

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Speaker 1: There's some signs today that Liz Cheney's time as the

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Speaker 1: GOP Conference chair may be numbered. Just to catch everyone

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Speaker 1: up here who maybe hasn't been following this bit by

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Speaker 1: bit so, Cheney was one of ten House Republicans who

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Speaker 1: voted to impeach Trump following the January six ride at

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Speaker 1: the Capitol by the Presidents by the former president supporters.

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Speaker 1: She fended off attempts to oust her in February, but

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Speaker 1: she's become increasingly isolated in her own party after she

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Speaker 1: repeatedly has criticized Trump. Its just continue you to falsely

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Speaker 1: claim that the election was rigged. So here we are.

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Speaker 1: It's uh, it's Tuesday, May fourth, and today we have

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Speaker 1: Kevin McCarthy, the highest ranking Republican in the House, saying,

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Speaker 1: and I quote, I've heard from members concerned about her

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Speaker 1: ability to carry out the job as conference chair, to

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Speaker 1: carry out the message. So Rick, I wanna start with

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Speaker 1: you here. Um, you're a Republican veteran, you've you've you've

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Speaker 1: been in these campaigns. Is this just kind of more

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Speaker 1: noise or is this kind of the real time when

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Speaker 1: the rubber hits the road in terms of figuring out

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Speaker 1: whether the Republican Party is still the Party of Trump

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Speaker 1: or something else. Well, Ben, I must say congratulations because

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Speaker 1: you did make a complete insider baseball issue sound actually

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Speaker 1: mainstream as you introduced this topic. So well done on that. Look,

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Speaker 1: I mean, this is stuff of junkies. Um McCarthy goes on,

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Speaker 1: it's got a hot Mike says he's had it with

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Speaker 1: her on the same Fox interview that makes its rounds,

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Speaker 1: um and and and I love the message he gave

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Speaker 1: that she can't carry the message. Is the message that

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Speaker 1: she's not caring that they want to agree to the

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Speaker 1: lot in the big lie about the election? Or uh?

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Speaker 1: Is it something to do with taxes and spending of

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Speaker 1: the Biden administration, because I don't think she has same

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Speaker 1: problem with that one. I would say she was given

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Speaker 1: a little bit of a lifeline by centaertt Romney today

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Speaker 1: who weighed in on her behalf and said that you know,

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Speaker 1: he supports her for refusing to perpetuate this Trump myth

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Speaker 1: on voters and also and also we also heard from

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Speaker 1: the White House Press Secretary Jen Saki weighing in as well.

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Speaker 1: We have sound on that the Republican Party seems to

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Speaker 1: be spending a lot of blood, sweat and tears trying

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Speaker 1: to figure out where they stand and what they stand for.

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Speaker 1: And that's their prerogative. So, Laura, I want to bring

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Speaker 1: in here politically for the Democrats. You know, is this

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Speaker 1: just kind of inside GOP Beltway baseball or or is

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Speaker 1: this kind of what some Democrats have been hoping for

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Speaker 1: for a long time, that moment when Republicans have to

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Speaker 1: decide are you still the party of Trump or or

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Speaker 1: has the party moved on? You know, I think it's bad.

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Speaker 1: I think it's also it's let's a litmus test about Trump,

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Speaker 1: which is who is inarguably the head of the of

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Speaker 1: the Republican Party. Um. I do think it's a little

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Speaker 1: bit more about how the GOP will tolerate differences of opinion,

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Speaker 1: especially about something like whether or not someone won an election,

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Speaker 1: like how central is what Trump says um and his

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Speaker 1: pet issues the cornerstone of the party. And I think

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Speaker 1: we got our answer. When you take the highest ranking

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Speaker 1: GOP woman. And you have Kevin McCarthy, who I think

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Speaker 1: his knees are knocking. I think he took a call

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Speaker 1: from Mara Lago and got a little scared because as

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Speaker 1: soon as she speaks out with no coincidence that that

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Speaker 1: that Donald Trump had brought up the Big lie once

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Speaker 1: again in a public way the day before. So she's

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Speaker 1: maintained a consistent position. But I would say there are

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Speaker 1: three things here that we can take away. One, we

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Speaker 1: see a retaliation against women like Liz Shaney and not

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Speaker 1: against folks like um Marjorie Taylor Green and Matt Gates.

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Speaker 1: The second thing I would say is what we were

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Speaker 1: talking about before, what is the Republican message message? If

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Speaker 1: Kevin McCarthy says that she's off message, is that the

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Speaker 1: central message that we're going to see running into the

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Speaker 1: mid terms. I think maybe it is. I think it

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Speaker 1: also highlights the Republicans have struggled to find a cohesive

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Speaker 1: message in terms of what they would do for Americans.

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Speaker 1: They do have a solid grip on the whatever Biden

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Speaker 1: is doing, it's a no, but I think that's something

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Speaker 1: to look for. Kevin McCarthy wants a message and force,

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Speaker 1: but it's not clear exactly what it is. And then

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Speaker 1: the third thing, fealty to Trump remains the primary measure

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Speaker 1: of the support you will get from GOP leadership, and

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Speaker 1: we will see that as the mid terms continue and

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Speaker 1: Republican primaries take place. And Rick, do you think that's

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Speaker 1: going to continue into as we kind of look towards two.

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Speaker 1: I mean one thing, uh, you know, with Kevin McCarthy, Uh,

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Speaker 1: one of our colleagues here at Bloomberg noted that that

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Speaker 1: he's you know, been mentioning Trump in a recent visit

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Speaker 1: tomorrow lago in fundraising notes as well. So so is

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Speaker 1: is how much of what we're seeing here is about fundraising?

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Speaker 1: And how much of this do you think it is

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Speaker 1: just a preview to what we're going to see over

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Speaker 1: the next year in terms of the campaign? You know,

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Speaker 1: I think it's a mixed bag. Then I think you're

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Speaker 1: gonna have Donald Trump uh continue to hold some control

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Speaker 1: over the party apparatus, especially around money. And and by

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Speaker 1: the way, he's the one raising the money in his account,

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Speaker 1: not into the RNC account, so the party won't have

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Speaker 1: access to it. He will and and so yes, there'll

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Speaker 1: be people who want to make their way to mar

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Speaker 1: Lago for cash. Uh. In addition to that, he's going

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Speaker 1: to use that cash to run against you know, sitting

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Speaker 1: U S senators and congressmen who have not carried his message,

432
00:22:56,600 --> 00:22:59,320
Speaker 1: whatever that happens to be. And and and so I

433
00:22:59,320 --> 00:23:01,320
Speaker 1: think there's going to be that kind of pushback. But

434
00:23:01,320 --> 00:23:04,280
Speaker 1: there are leaders in the Repulican probably like Mitch McConnell said, Okay,

435
00:23:04,280 --> 00:23:07,679
Speaker 1: stop it, I'll give I'll give cover to Republican senators

436
00:23:07,720 --> 00:23:09,880
Speaker 1: who want to speak out on this. You're never gonna

437
00:23:09,920 --> 00:23:13,000
Speaker 1: hear him admonishment Romney for weighing in on something like this.

438
00:23:13,080 --> 00:23:16,080
Speaker 1: So the party is split. How far it split is

439
00:23:16,200 --> 00:23:18,600
Speaker 1: yet to be determined. And all of this is actually

440
00:23:18,640 --> 00:23:22,840
Speaker 1: bad for their prospects for winning seats in so rick

441
00:23:22,920 --> 00:23:24,399
Speaker 1: real quick. And then, Laura, I want to ask you too,

442
00:23:24,520 --> 00:23:26,920
Speaker 1: do you think this? Do you think we're gonna see? Uh?

443
00:23:27,160 --> 00:23:29,679
Speaker 1: Liz Cheney au stood here from her leadership role. What

444
00:23:29,720 --> 00:23:32,360
Speaker 1: do I think if McCarthy pulls his support from her,

445
00:23:32,520 --> 00:23:37,520
Speaker 1: she'll probably go? How about you? Laura support when she

446
00:23:37,720 --> 00:23:40,399
Speaker 1: was called upon when her vote was called in February.

447
00:23:40,480 --> 00:23:42,760
Speaker 1: I think I think she's got a chance of surviving it.

448
00:23:42,840 --> 00:23:46,560
Speaker 1: Since it's a secret ballot. It'll be close interesting. Well,

449
00:23:46,800 --> 00:23:50,920
Speaker 1: we'll we'll certainly uh be watching, be watching closely. When

450
00:23:50,960 --> 00:23:54,000
Speaker 1: we come back, I'm going to be speaking with Democratic

451
00:23:54,880 --> 00:23:58,720
Speaker 1: Commissioner Alison Herren Lee on the Securities and Exchange Commission.

452
00:23:58,760 --> 00:24:02,800
Speaker 1: We're gonna talk about a number of topics, market volatility,

453
00:24:02,840 --> 00:24:05,480
Speaker 1: We're gonna talk about cryptocurrencies. We're also going to talk

454
00:24:05,480 --> 00:24:09,960
Speaker 1: about climate and the role that the SEC can play there. Uh,

455
00:24:10,000 --> 00:24:12,680
Speaker 1: it's going to be an interesting conversation. We will be back.

456
00:24:13,160 --> 00:24:15,879
Speaker 1: I'm Ben Bain. This is Bloomberg. I'm Ben Bain. I'm

457
00:24:15,960 --> 00:24:18,840
Speaker 1: joined by Alison Herren Lee, a Democratic member of the

458
00:24:18,880 --> 00:24:22,320
Speaker 1: Securities and Exchange Commission who until last month was serving

459
00:24:22,359 --> 00:24:25,920
Speaker 1: as the acting chair of the SEC. Wall Street's main regulator,

460
00:24:25,920 --> 00:24:29,080
Speaker 1: Commissioner Lee, thanks so much for joining us. Thank you then,

461
00:24:29,119 --> 00:24:31,520
Speaker 1: it's a pleasure to be here. So it's been a

462
00:24:31,520 --> 00:24:34,000
Speaker 1: busy year and you were at the helm of the

463
00:24:34,080 --> 00:24:37,119
Speaker 1: SEC for much of it. Um and it seems like

464
00:24:37,160 --> 00:24:40,040
Speaker 1: it's it's pretty unlikely to to slow down anytime soon.

465
00:24:40,280 --> 00:24:43,000
Speaker 1: I'm just looking at kind of stock stock moves of

466
00:24:43,040 --> 00:24:46,760
Speaker 1: the day, and market seems to hit record after record.

467
00:24:46,920 --> 00:24:51,679
Speaker 1: Cryptocurrencies are surgy. Some have been calling this and everything rally.

468
00:24:51,760 --> 00:24:56,080
Speaker 1: I'm curious, Commissioner, from from your position, what worries you

469
00:24:56,119 --> 00:24:59,960
Speaker 1: about this situation that we find ourselves in right now,

470
00:25:00,080 --> 00:25:03,600
Speaker 1: where where everything seems to be going up? UM, are

471
00:25:03,600 --> 00:25:06,880
Speaker 1: there areas that you think, maybe, um, the SEC needs

472
00:25:06,880 --> 00:25:11,080
Speaker 1: to be paying particular attention to sure. You know, what

473
00:25:11,160 --> 00:25:13,679
Speaker 1: I would say is, uh, it's our job at the

474
00:25:13,800 --> 00:25:17,040
Speaker 1: SEC to to worry and and to you know, focus

475
00:25:17,080 --> 00:25:19,520
Speaker 1: on and consider what's going on in the market's Um.

476
00:25:19,560 --> 00:25:22,679
Speaker 1: It's not our job to uh, you know, police whether

477
00:25:22,680 --> 00:25:24,800
Speaker 1: they go up or down, but rather to make sure

478
00:25:24,840 --> 00:25:27,720
Speaker 1: that they're running smoothly. And I think you know, that's

479
00:25:27,760 --> 00:25:29,920
Speaker 1: something that we've been able to do in the face

480
00:25:30,000 --> 00:25:32,719
Speaker 1: of a lot of volume, a lot of demand, um,

481
00:25:32,760 --> 00:25:35,320
Speaker 1: you know, and and and a lot of ups and downs.

482
00:25:35,440 --> 00:25:39,119
Speaker 1: So I'm I'm comfortable with the infrastructure and UM in

483
00:25:39,240 --> 00:25:43,520
Speaker 1: terms of the economy and the stock market itself, those

484
00:25:43,560 --> 00:25:46,040
Speaker 1: are issues that you know, as I said that, that's

485
00:25:46,040 --> 00:25:50,000
Speaker 1: our job to be focused on and worried about and

486
00:25:50,000 --> 00:25:52,600
Speaker 1: and and you know, as as you were acting chair

487
00:25:53,480 --> 00:25:57,800
Speaker 1: of the agency for really up until a few weeks ago, uh,

488
00:25:57,840 --> 00:26:00,760
Speaker 1: you know, there was tremendous market volatility and I was wondering,

489
00:26:00,760 --> 00:26:03,840
Speaker 1: if you know, I'd like to hear your views, particularly

490
00:26:04,040 --> 00:26:07,080
Speaker 1: just a few weeks in when we had this, uh,

491
00:26:07,280 --> 00:26:11,119
Speaker 1: this really extraordinary moment with game Stop and some of

492
00:26:11,119 --> 00:26:14,400
Speaker 1: these other so called meme stocks. Um, it was became

493
00:26:14,440 --> 00:26:17,080
Speaker 1: a national story. Essentially, it was usually a business story,

494
00:26:17,160 --> 00:26:21,640
Speaker 1: became this Wall Street versus Main Street phenomenon. And now

495
00:26:21,640 --> 00:26:24,600
Speaker 1: that we've kind of moved a few months past that, UM,

496
00:26:24,680 --> 00:26:27,239
Speaker 1: I'm curious to kind of hear from you about what

497
00:26:27,280 --> 00:26:31,080
Speaker 1: the takeaways were. Where do you think the gaps were

498
00:26:31,400 --> 00:26:35,840
Speaker 1: in terms of regulation or visibility, um, that that we saw,

499
00:26:36,040 --> 00:26:37,920
Speaker 1: you know, through all this, and do you think they've

500
00:26:37,960 --> 00:26:39,879
Speaker 1: been they've been plugged at this point and there's more

501
00:26:39,960 --> 00:26:44,000
Speaker 1: left to do, so you're you're absolutely right, that was

502
00:26:44,040 --> 00:26:47,840
Speaker 1: a pretty galvanizing moment, UM, and it occurred actually one

503
00:26:48,000 --> 00:26:50,880
Speaker 1: one week into my tenure. Um. You know, I think

504
00:26:50,880 --> 00:26:54,879
Speaker 1: it's premature at this point to draw any firm, definite conclusions,

505
00:26:55,560 --> 00:26:58,359
Speaker 1: and as you probably know, our staff is working on

506
00:26:58,400 --> 00:27:01,439
Speaker 1: a report right now to kind of layout all the facts.

507
00:27:01,440 --> 00:27:03,919
Speaker 1: I think it's very important that we get the facts

508
00:27:04,000 --> 00:27:07,040
Speaker 1: right so that we get the policy right. But certainly, UM,

509
00:27:07,200 --> 00:27:11,560
Speaker 1: it brought to the forefront some pretty important issues. First

510
00:27:11,600 --> 00:27:14,560
Speaker 1: and foremost, I think payment for order flow, which I

511
00:27:14,560 --> 00:27:18,720
Speaker 1: know you know is just through the practice of broker

512
00:27:18,720 --> 00:27:23,560
Speaker 1: dealers routing customer orders based on venues paying them for

513
00:27:23,720 --> 00:27:26,040
Speaker 1: routing those orders. I think to make sure that they're

514
00:27:26,080 --> 00:27:30,080
Speaker 1: sufficient transparency and visibility on how that's operating, is whether

515
00:27:30,280 --> 00:27:34,520
Speaker 1: that's operating in investors, retail investors best interests. It also,

516
00:27:34,680 --> 00:27:37,119
Speaker 1: I think brought to the forefront this idea of so

517
00:27:37,240 --> 00:27:41,800
Speaker 1: called gamification of the stock markets. Um. Clearly, you know,

518
00:27:41,880 --> 00:27:45,480
Speaker 1: tools and apps are very useful in increasing investors access

519
00:27:45,520 --> 00:27:47,200
Speaker 1: to the markets, but we really need to pay close

520
00:27:47,240 --> 00:27:51,320
Speaker 1: attention to whether they are promoting investors behavior that's really

521
00:27:51,400 --> 00:27:56,000
Speaker 1: in the investors interest rather than that of the blogers themselves,

522
00:27:56,000 --> 00:27:59,720
Speaker 1: and whether they distort perceptions about the real life consequences

523
00:27:59,760 --> 00:28:02,000
Speaker 1: of the risks that they're trading. So so there are

524
00:28:02,000 --> 00:28:05,159
Speaker 1: a couple of, you know, I think policy issues that

525
00:28:05,160 --> 00:28:07,959
Speaker 1: we're going to need to look at going forward to

526
00:28:08,000 --> 00:28:10,880
Speaker 1: make sure we understand whether there are steps we need

527
00:28:10,960 --> 00:28:16,000
Speaker 1: to take. As you know, the the SEC Chairman Gary

528
00:28:16,040 --> 00:28:20,280
Speaker 1: Gensler is going to be uh testifying in hearing just

529
00:28:20,359 --> 00:28:24,520
Speaker 1: two days on Thursday before the House Financial Service Committee,

530
00:28:24,720 --> 00:28:27,640
Speaker 1: UH talking about game stop and some of these these

531
00:28:27,760 --> 00:28:32,159
Speaker 1: very issues. Is there a need for Congress to step

532
00:28:32,200 --> 00:28:35,240
Speaker 1: in here? Um? The House Financial Services Committee has put

533
00:28:35,280 --> 00:28:39,080
Speaker 1: out a couple of drafts UH proposed bills. Some of

534
00:28:39,120 --> 00:28:41,400
Speaker 1: them are only two pages long, but they seem to

535
00:28:41,400 --> 00:28:45,520
Speaker 1: suggest that there's some desire to actually write law that

536
00:28:45,560 --> 00:28:47,200
Speaker 1: would deal with some of these issues. Or is this

537
00:28:47,280 --> 00:28:49,840
Speaker 1: something that, as you see it, the SEC has the

538
00:28:49,840 --> 00:28:55,640
Speaker 1: power to do itself through rulemaking or other types of measures. Well,

539
00:28:55,680 --> 00:28:58,480
Speaker 1: it depends on the specific policy that we're looking at

540
00:28:58,480 --> 00:29:02,360
Speaker 1: in the specific issue. Obviously, Congress will make its own

541
00:29:02,360 --> 00:29:06,400
Speaker 1: decisions about women if it wants to draft legislation. We

542
00:29:06,560 --> 00:29:10,239
Speaker 1: certainly have the requisite authority to look at things like

543
00:29:10,400 --> 00:29:14,120
Speaker 1: I mentioned the like payments for order flow, like like gamification.

544
00:29:14,520 --> 00:29:17,120
Speaker 1: We've also got you know, there are some other issues

545
00:29:17,160 --> 00:29:20,560
Speaker 1: that that this these events raised, like like the settlement

546
00:29:20,600 --> 00:29:23,480
Speaker 1: cycle and the length of the settlement cycle. Um, we

547
00:29:23,600 --> 00:29:26,720
Speaker 1: have certainly, you know, we've got plenty of authority to

548
00:29:26,800 --> 00:29:29,160
Speaker 1: look at and consider that. As you know, we recently

549
00:29:29,240 --> 00:29:32,920
Speaker 1: we shortened the settlement cycle three years ago. Now we're

550
00:29:33,000 --> 00:29:35,240
Speaker 1: kind of looking at whether we need to do that again.

551
00:29:35,840 --> 00:29:39,000
Speaker 1: So I think we have plenty of authority to deal

552
00:29:39,040 --> 00:29:42,080
Speaker 1: with many of the issues and policies that are implicated

553
00:29:42,200 --> 00:29:44,920
Speaker 1: by these events. But that doesn't mean that Congress may

554
00:29:44,920 --> 00:29:48,120
Speaker 1: not decide to, you know, to to draft some legislation

555
00:29:48,160 --> 00:29:51,320
Speaker 1: that's completely within their um, that's within their realm to

556
00:29:51,360 --> 00:29:53,880
Speaker 1: do so, should they choose and and and game Stoff

557
00:29:53,880 --> 00:29:56,000
Speaker 1: issues were kind of right at the beginning of your tenure.

558
00:29:56,040 --> 00:29:58,840
Speaker 1: And then right at the end, there was another event

559
00:29:58,920 --> 00:30:01,920
Speaker 1: that really captured Wall Street and and you know, not

560
00:30:01,960 --> 00:30:05,520
Speaker 1: just financial headlines, but but more broadly as well. And

561
00:30:05,640 --> 00:30:08,760
Speaker 1: that was, um, you know, the liquidation of our keego's

562
00:30:08,800 --> 00:30:11,840
Speaker 1: capital management. And in some of the issues raised there

563
00:30:12,680 --> 00:30:17,960
Speaker 1: essentially of how family offices UM are regulated and also

564
00:30:18,040 --> 00:30:21,920
Speaker 1: how derivatives are used on Wall Street. Uh, people have

565
00:30:22,040 --> 00:30:26,120
Speaker 1: been raising issues in terms of whether there needs to

566
00:30:26,160 --> 00:30:29,600
Speaker 1: be increased regulation both in terms of the use of

567
00:30:29,640 --> 00:30:35,600
Speaker 1: derivatives potentially by family offices and hedge funds, and additionally

568
00:30:35,640 --> 00:30:40,080
Speaker 1: whether there's perhaps disclosure or additional disclosure needed. UM, I'm

569
00:30:40,120 --> 00:30:42,120
Speaker 1: wondering if you could tell us a little bit about

570
00:30:42,160 --> 00:30:44,920
Speaker 1: where you think the SEC needs to go here. UM.

571
00:30:45,000 --> 00:30:49,440
Speaker 1: This issue certainly is captured a lot of interest, particularly

572
00:30:50,000 --> 00:30:55,120
Speaker 1: as banks have collectively reported billions of dollars and losses. Yeah,

573
00:30:55,240 --> 00:30:58,200
Speaker 1: no question. I mean, as you point out this, this

574
00:30:58,400 --> 00:31:01,480
Speaker 1: this particular fund Archiego was a it's what's called a

575
00:31:01,520 --> 00:31:04,200
Speaker 1: family office, which for the most part means they are

576
00:31:04,200 --> 00:31:09,040
Speaker 1: excluded from a lot of our regulatory regime at the SEC.

577
00:31:09,480 --> 00:31:12,640
Speaker 1: And so you know, if they're a transparency gap there,

578
00:31:12,680 --> 00:31:16,800
Speaker 1: perhaps perhaps there is UM. They're not completely that. There's

579
00:31:16,800 --> 00:31:20,200
Speaker 1: certainly are rules like as you know about reporting thresholds

580
00:31:20,200 --> 00:31:22,880
Speaker 1: for investors under thirteen D if they hit five per

581
00:31:22,920 --> 00:31:26,320
Speaker 1: cent they have to report UM, but not when it's

582
00:31:26,320 --> 00:31:28,479
Speaker 1: a derivative. So I do think we need we need

583
00:31:28,560 --> 00:31:31,240
Speaker 1: to look at and consider whether when we have these

584
00:31:31,320 --> 00:31:35,040
Speaker 1: kinds of products that are not directly equities, but rather

585
00:31:35,120 --> 00:31:38,000
Speaker 1: these total return swaps, which are which are derivative forms

586
00:31:38,040 --> 00:31:41,600
Speaker 1: of that, should we have a better reporting regime. Should

587
00:31:41,640 --> 00:31:44,080
Speaker 1: they have to report UM, you know on thirteen D.

588
00:31:44,160 --> 00:31:47,040
Speaker 1: Should they have to report their holdings under under thirteen

589
00:31:47,200 --> 00:31:51,360
Speaker 1: S that's kind of quarterly holdings that institutional investment advisors

590
00:31:51,520 --> 00:31:54,400
Speaker 1: would would normally report. I think we need to look

591
00:31:54,480 --> 00:31:57,720
Speaker 1: at all of that UM. And I think finally one

592
00:31:57,760 --> 00:32:00,440
Speaker 1: really important piece that we need to consider here is

593
00:32:00,800 --> 00:32:03,600
Speaker 1: whether we understand as well as we need to the

594
00:32:03,680 --> 00:32:07,360
Speaker 1: risk management practices at some of these counterparties, these prime

595
00:32:07,640 --> 00:32:11,520
Speaker 1: UH dealers that will counterparties to our keegos that seemed

596
00:32:11,520 --> 00:32:15,480
Speaker 1: to be unaware of kegs combined exposures. How big of

597
00:32:15,520 --> 00:32:19,160
Speaker 1: a blind spot? Uh? You know was this? I mean,

598
00:32:19,160 --> 00:32:21,960
Speaker 1: do you think that you know this was something this

599
00:32:22,040 --> 00:32:23,560
Speaker 1: is a bit of a wake up call, or this

600
00:32:23,680 --> 00:32:25,520
Speaker 1: was this was a one off when you think about

601
00:32:25,560 --> 00:32:27,920
Speaker 1: it in kind of the the overall system here of

602
00:32:28,360 --> 00:32:33,360
Speaker 1: identities like this and the regulation coming from Washington. Well,

603
00:32:33,360 --> 00:32:35,160
Speaker 1: it's hard to know when you say how big of

604
00:32:35,160 --> 00:32:37,480
Speaker 1: a blind spot are if you're referring to how big

605
00:32:37,520 --> 00:32:40,920
Speaker 1: of a blind spot was it at the with the counterparties. Um,

606
00:32:41,040 --> 00:32:44,080
Speaker 1: that's the question, of course I can't answer directly, but

607
00:32:44,160 --> 00:32:47,080
Speaker 1: I will say that I you know, it strikes me

608
00:32:47,160 --> 00:32:49,440
Speaker 1: as being similar to a bank giving out a loan

609
00:32:49,600 --> 00:32:53,320
Speaker 1: without visibility on the other depths of the loan recipient.

610
00:32:53,400 --> 00:32:55,160
Speaker 1: So I, you know, I worry about that a little

611
00:32:55,200 --> 00:32:58,200
Speaker 1: bit In terms of regulatory blind spots, As I said,

612
00:32:58,240 --> 00:32:59,840
Speaker 1: I think there are some places we need to con

613
00:33:00,000 --> 00:33:02,720
Speaker 1: it or whether the definition of family office is it

614
00:33:02,840 --> 00:33:05,200
Speaker 1: the way? You know, do we have the carve out

615
00:33:05,360 --> 00:33:09,680
Speaker 1: right there. I think looking at potential reporting on third

616
00:33:09,840 --> 00:33:14,000
Speaker 1: and thirteen the holdings, and you know, of these types

617
00:33:14,040 --> 00:33:16,240
Speaker 1: of derivatives of something we need to look at. So

618
00:33:16,480 --> 00:33:19,200
Speaker 1: you know, it does implicate some some policies that I

619
00:33:19,200 --> 00:33:21,360
Speaker 1: think it makes good sense for us to consider. I

620
00:33:21,440 --> 00:33:23,400
Speaker 1: want to switch gears a little bit and askue. During

621
00:33:23,520 --> 00:33:26,320
Speaker 1: during your time is as acting chair, you were very

622
00:33:26,360 --> 00:33:29,880
Speaker 1: focused on the role that the SEC could play in

623
00:33:29,960 --> 00:33:34,280
Speaker 1: terms of uh E S, G and and climate. UM.

624
00:33:34,440 --> 00:33:37,600
Speaker 1: Talk with us a little bit about how you see

625
00:33:37,680 --> 00:33:43,520
Speaker 1: the financial regulator and the financial regulatory structure UM dealing

626
00:33:43,560 --> 00:33:46,400
Speaker 1: with climate. You know, there's there's some in the business

627
00:33:46,400 --> 00:33:49,160
Speaker 1: community and also Republicans who kind of pushed back against

628
00:33:49,200 --> 00:33:51,520
Speaker 1: the idea that the SEC is squarely in the middle

629
00:33:51,560 --> 00:33:54,080
Speaker 1: of this UM. You know, you've made it UM pretty

630
00:33:54,160 --> 00:33:57,200
Speaker 1: much a focus UM at the regulator. So you know,

631
00:33:57,320 --> 00:33:58,560
Speaker 1: I'd like for you to tell us a little bit

632
00:33:58,600 --> 00:34:00,680
Speaker 1: about how you how you see the SEC is playing

633
00:34:00,680 --> 00:34:04,400
Speaker 1: in port role here. Sure, I mean it starts with

634
00:34:04,760 --> 00:34:09,759
Speaker 1: the investor demand. There's enormous investor demand for climates and

635
00:34:09,920 --> 00:34:14,160
Speaker 1: particularly climate related but also other e SC related disclosures,

636
00:34:14,239 --> 00:34:17,799
Speaker 1: and that's our job at the sec is to protect investors.

637
00:34:17,800 --> 00:34:20,840
Speaker 1: It's a central part of what we do, so ensuring

638
00:34:20,880 --> 00:34:24,839
Speaker 1: that investors have consistent, comparable and reliable information so they

639
00:34:24,840 --> 00:34:29,040
Speaker 1: can price risk and allocate capital. UM. That's our roll.

640
00:34:29,200 --> 00:34:32,799
Speaker 1: And here I think we've got investors representing tens of

641
00:34:32,920 --> 00:34:36,360
Speaker 1: trillions of dollars in investments, the largest asset managers in

642
00:34:36,400 --> 00:34:40,000
Speaker 1: the world. They're out there UM telling us they need

643
00:34:40,040 --> 00:34:42,640
Speaker 1: more information in order to do this. So I think

644
00:34:42,680 --> 00:34:44,920
Speaker 1: we need to take a look at that team up

645
00:34:44,960 --> 00:34:49,480
Speaker 1: with market participants and investors, UM and issuers. Thank you

646
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Speaker 1: very much, thanks so much for joining us. That was

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Speaker 1: Democratic Commissioner Alis inherent Lee on the Securities and Exchange Commission.

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Speaker 1: I'm Ben Bane. This is Bloomberg