WEBVTT - Trump Is Getting a Civics Lesson in First 100 Days, Haass Says 0:00:00.120 --> 0:00:02.920 Brought you by Bank of America, Mary Lynch. Investing in 0:00:03.000 --> 0:00:07.840 local communities, economies and a sustainable future. That's the power 0:00:08.080 --> 0:00:12.360 of global connections, Mary Lynch, Pierce Fenner and Smith Incorporated 0:00:12.760 --> 0:00:26.400 Member s I p C. Welcome to the Bloomberg Surveillance Podcast. 0:00:26.440 --> 0:00:29.920 I'm Tom Keene with David Gura. Daily we bring you 0:00:29.960 --> 0:00:34.800 insight from the best of economics, finance, investment, and international relations. 0:00:35.240 --> 0:00:40.760 Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, Bloomberg dot Com, 0:00:40.800 --> 0:00:48.560 and of course, on the Bloomberg. Can I bring Richard Os? 0:00:48.560 --> 0:00:50.720 Please bring in Richard? Host Joins is now President of 0:00:50.760 --> 0:00:53.400 Council and Form Relations, author of A World in Disarray, 0:00:53.440 --> 0:00:56.400 American Foreign Policy and the Crisis of the Old Order. 0:00:56.400 --> 0:00:58.760 He's in our Bloomberg eleven three our studios with Tom 0:00:59.040 --> 0:01:00.560 in New York. Sorry about that, Chard. Let me let 0:01:00.600 --> 0:01:03.080 me start by asking you about what's happening in New 0:01:03.120 --> 0:01:05.240 York today. The Secretary of State rex dealers and headed 0:01:05.319 --> 0:01:07.440 up to the U n UH. He'll be talking about 0:01:07.480 --> 0:01:08.800 North Korea. What do you expect to hear from What 0:01:08.840 --> 0:01:10.760 would you like to hear from him on the issue 0:01:10.760 --> 0:01:12.880 of North Korea today at the U n What the 0:01:12.920 --> 0:01:16.480 United States is doing and the presidents doing it regularly 0:01:16.480 --> 0:01:19.440 in his tweets. It's just essentially saying this is an intolerable, 0:01:19.520 --> 0:01:23.520 unacceptable situation, and they're signaling Beijing that they have got 0:01:23.520 --> 0:01:25.480 to put much more pressure on North Korean And I 0:01:25.520 --> 0:01:27.840 think this is the prelude to in the uh to 0:01:28.240 --> 0:01:30.639 an effort to open up a negotiation between the United 0:01:30.640 --> 0:01:33.080 States and North Korea to see not if we can 0:01:33.120 --> 0:01:35.920 resolve the problem, but at least put a ceiling on 0:01:35.959 --> 0:01:39.039 it in the way both sides can live with. When 0:01:39.080 --> 0:01:41.920 you look at what the President said thus far, is 0:01:41.959 --> 0:01:44.840 he indicating that he's moving toward likely preemptive strikes? He does, 0:01:44.840 --> 0:01:46.480 he want to have more conversations as he want to 0:01:46.480 --> 0:01:48.280 rely more on on sanctions. When you look at what 0:01:48.320 --> 0:01:50.880 that policy might be, what do you see as the 0:01:50.880 --> 0:01:53.640 contours of it. Well, what you're seeing is the putting 0:01:53.640 --> 0:01:56.040 the military option quote unquote on the table, as the 0:01:56.120 --> 0:01:58.560 cliche goes, and they keep talking about it, but no 0:01:58.600 --> 0:02:01.680 one's anxious to go to war. The reality of what 0:02:01.760 --> 0:02:04.240 a second Korean war be is it should make anyone 0:02:04.320 --> 0:02:06.800 pause and then pause again. But they've got to put 0:02:06.840 --> 0:02:08.640 that out there because it is a real option, because 0:02:08.639 --> 0:02:11.080 the whole idea of allowing this to continue to drift 0:02:11.560 --> 0:02:14.239 is a truly unattractive future. And this though, is a 0:02:14.360 --> 0:02:17.720 necessary prelude to set the table again for a negotiation, 0:02:17.800 --> 0:02:21.360 and that requires Chinese pressure on North Korea. Let me 0:02:21.400 --> 0:02:25.040 ask the right wing question, can we negotiate with a nation? 0:02:25.320 --> 0:02:29.120 I guess it's a nation that barely is ruled by law? 0:02:29.520 --> 0:02:32.440 I mean, do they even observed the North Korea even 0:02:32.440 --> 0:02:36.520 observe international law to a limited extent? And the answer is, well, 0:02:36.520 --> 0:02:38.919 you know, again, the alternatives are lousy. That's where the 0:02:39.000 --> 0:02:41.480 Chinese come in to put to use their leverage. And 0:02:41.480 --> 0:02:44.480 we'll try. And we've had negotiations with North Korea before, 0:02:44.520 --> 0:02:48.480 both bilateral and multilateral. We've had shall we say, limited success, 0:02:48.520 --> 0:02:51.520 which is another way of saying also limited failure, And 0:02:51.639 --> 0:02:53.640 you know, we'll go at it one more time. David 0:02:53.639 --> 0:02:56.640 Guray in Washington and Tom keenan New York. David, we 0:02:56.680 --> 0:03:00.920 have Douglas holtz Eken coming up later on tax reform. 0:03:01.160 --> 0:03:03.799 Maybe that's a good way to secure you with Ambassador 0:03:03.960 --> 0:03:08.320 hass into the domestic front. Yeah, when you look at 0:03:08.320 --> 0:03:10.440 all of the let's let's use the hundred day metric, 0:03:10.480 --> 0:03:12.080 and we've had a president here has been uneasy about 0:03:12.080 --> 0:03:14.119 people holding that up. He was keen to talk about 0:03:14.160 --> 0:03:15.760 all that he hoped to accomplish in the free hundred 0:03:15.800 --> 0:03:18.200 days earlier on in them, and now he's he's downplaying 0:03:18.200 --> 0:03:20.440 the importance of it. When you look at the ambitiousness 0:03:20.480 --> 0:03:22.920 of his foreign policy and domestic policy, how do you 0:03:22.919 --> 0:03:24.680 how do you rate sort of what what he's been 0:03:24.720 --> 0:03:27.359 able to do and and what's he learned about governing 0:03:27.360 --> 0:03:29.840 here in these first hundred days. On the farm policy 0:03:29.840 --> 0:03:33.240 society's probably had two pluses, the limited use of force 0:03:33.320 --> 0:03:36.600 in Surria and the marshaling of pressure on on North Korea. 0:03:36.880 --> 0:03:39.560 I think the real diant downside on FIGM policies. He's 0:03:39.600 --> 0:03:44.120 injected so much uncertainty into American FIGN policy that he's 0:03:44.160 --> 0:03:47.560 really worked against the fabric of almost all of our 0:03:47.600 --> 0:03:51.280 alliance relations. I think at home he's learned the difference 0:03:51.360 --> 0:03:55.000 between campaigning or business life on one hand, on political 0:03:55.080 --> 0:03:57.720 governing on the other, whether it's health care or now 0:03:57.760 --> 0:04:01.520 these other issues. He's having real problems building a viable 0:04:01.560 --> 0:04:04.320 coalition with Congress, and more broadly, I think he's seen 0:04:04.360 --> 0:04:07.720 the strength of independent institutions in American democracy. So he 0:04:07.760 --> 0:04:11.680 has his his orders on homeland security and immigration and refugees, 0:04:11.920 --> 0:04:14.480 and time and time again has been rebuffed by the courts. 0:04:14.880 --> 0:04:17.400 So this is almost a course. And Professor Dick new 0:04:17.480 --> 0:04:19.960 stat my former colleague at Harvard about that we have 0:04:20.040 --> 0:04:24.040 separate institutions, each wielding independent power. I think Mr Trump 0:04:24.080 --> 0:04:26.919 is basically getting Civics one O one. You know, after 0:04:27.080 --> 0:04:30.000 after the US launched those tomahawk strikes on Syria, I 0:04:30.000 --> 0:04:32.160 think a lot of people wondering what would happen next? 0:04:32.160 --> 0:04:35.520 Have we gotten any more clarity on what has changed 0:04:35.520 --> 0:04:37.359 when it comes to US Syria policy? And can you 0:04:37.440 --> 0:04:39.760 draw a line between what happened in Syria and indeed 0:04:39.800 --> 0:04:41.880 what our outlook is, what our policy is at toward 0:04:41.920 --> 0:04:44.800 North Korea? Are they Are they connected? On the first part. 0:04:44.880 --> 0:04:47.240 Not a whole lot of change with the American Syria policy. 0:04:47.279 --> 0:04:50.080 We're not going to make the removal of Bosher Alassa 0:04:50.240 --> 0:04:53.520 and his regime of priority. We we can't. Instead, you're 0:04:53.520 --> 0:04:56.560 going to have a focus on hammering isis trying to 0:04:56.600 --> 0:04:59.760 eliminate their control of territory, and the real challenge there 0:04:59.760 --> 0:05:01.800 will coming up with a policy for who would run 0:05:01.839 --> 0:05:04.440 it if and when they don't. I think the use 0:05:04.480 --> 0:05:07.200 of force in Syria wasn't part meant to signal China. 0:05:07.480 --> 0:05:09.400 If you remember, the use of force happened while she 0:05:09.800 --> 0:05:13.440 Jumping was dining in Mara Lago with that delicious chocolate cake, 0:05:14.000 --> 0:05:16.480 and I think it's most delicious. It was. It was 0:05:16.520 --> 0:05:18.800 a message to him and North Korea that this is 0:05:18.800 --> 0:05:22.520 an administration that's more comfortable with the use of military force. 0:05:22.560 --> 0:05:26.400 Then was Mr Obama's help me with with a president's doctrine? 0:05:26.440 --> 0:05:28.120 How long did it take before we got the so 0:05:28.240 --> 0:05:33.080 called Obama historical on a Friday? Well, I'm not so 0:05:33.200 --> 0:05:35.440 quite sure we ever had in Obama. You don't think so, No, 0:05:35.560 --> 0:05:37.800 I think what we had was a bias towards restraint 0:05:37.880 --> 0:05:41.240 and retrenchment. The doctrines have to be real explanations of 0:05:41.279 --> 0:05:42.719 what you're going to do in the world. They have 0:05:42.800 --> 0:05:45.680 to explain big things. They've got to be enduring. I'm 0:05:45.720 --> 0:05:50.520 not sure Mr Obama had one again, much more than theme. No, 0:05:50.680 --> 0:05:54.000 I thought it. Usually doctrines are conferred by history in retrospect. 0:05:54.320 --> 0:05:57.000 Anytime you you declare a doctrine, you don't you haven't 0:05:57.000 --> 0:05:59.679 done looking a little bit silly doctrines are the judgment 0:05:59.680 --> 0:06:01.720 of his three that what you've done really matters and 0:06:01.760 --> 0:06:04.880 really lasts. I have failed David Gura this morning, and 0:06:04.920 --> 0:06:08.040 that I did not speak to Richard hass about the 0:06:08.080 --> 0:06:11.040 Canadian events of the week. We featured the Canadian dollar 0:06:11.080 --> 0:06:14.039 at the beginning of the show one thirty six forty. 0:06:14.240 --> 0:06:18.520 Christiph Friedland, their Foreign Affairs minister, was quite sharp with 0:06:18.560 --> 0:06:21.840 our Matt Miller about how they've never lost on the 0:06:21.960 --> 0:06:26.400 lumber issue. What is the CFR backgrounder on this relation 0:06:26.480 --> 0:06:29.400 that we just take for granted? Well again on this 0:06:29.520 --> 0:06:31.680 on the lumber issue, there's nothing new. When I worked 0:06:31.720 --> 0:06:34.039 in the European Bureau of the State Department in the 0:06:34.040 --> 0:06:37.520 early this was Teddy Roosevelt. It feels like there was 0:06:37.640 --> 0:06:41.000 lumber one of those roads belts. We had the same issue. 0:06:41.040 --> 0:06:43.680 Then every day we'd start the European Bureau staff meeting 0:06:43.720 --> 0:06:46.719 with the latest on softwood lumber. Very little hash j 0:06:46.920 --> 0:06:49.120 became actually something have a standing joke. Well here we are, 0:06:49.960 --> 0:06:53.960 you know, thirty forty years later, the same issue. I think, 0:06:54.000 --> 0:06:56.680 more broadly, though it wasn't a bad day for Canada yesterday. 0:06:56.960 --> 0:06:59.039 The fact that the president got pushed by so many 0:06:59.080 --> 0:07:03.000 of his senior adviceisers to essentially say enough with breaking 0:07:03.080 --> 0:07:06.440 up napptick. You know, whatever your tactical positioning, this relationship 0:07:06.839 --> 0:07:10.000 is simply too important with Canada and Mexico. So I 0:07:10.000 --> 0:07:13.720 actually think things yesterday got back to reality. In your 0:07:14.000 --> 0:07:16.280 study of history and all the work of the Council 0:07:16.320 --> 0:07:21.600 on Foreign Relations, can you teach a dealmaker to negotiate 0:07:21.680 --> 0:07:25.360 within the US world? Uh? So far at least it's 0:07:25.400 --> 0:07:29.400 not clear. The president still New York Times actually is 0:07:29.440 --> 0:07:31.200 a story about it today. Is his whole approach is 0:07:31.240 --> 0:07:33.720 what worked in real estate. You are these narrow, one 0:07:33.720 --> 0:07:36.720 off approaches. You come out out of the box tremendously 0:07:37.000 --> 0:07:40.440 ambitious or aggressively, and what happens then is you've almost 0:07:40.480 --> 0:07:42.200 always got to back down. We had to do it 0:07:42.240 --> 0:07:44.400 with the Chinese over Taiwan. We're doing it with the 0:07:44.400 --> 0:07:47.080 Mexicans over the Wall. So you get a reputation for 0:07:47.120 --> 0:07:49.680 backing down, But in the meantime, you not only lose 0:07:49.720 --> 0:07:53.320 credibility with others, you undermine your friends. The thing with Canada, 0:07:53.960 --> 0:07:56.360 to be so aggressive with your friends sends the message 0:07:56.400 --> 0:07:59.520 we don't really value this relationship. I really think Mr 0:07:59.520 --> 0:08:02.280 Trump has got to figure out the difference between what 0:08:02.280 --> 0:08:05.640 what purportedly worked for him in real estate and being president. 0:08:05.680 --> 0:08:07.800 It's a totally different tool set. You sound like a 0:08:07.800 --> 0:08:14.240 marriage counselor my wife would tell you probably Richard as 0:08:14.240 --> 0:08:16.920 the president of the Council on Foreign Relations and of 0:08:16.960 --> 0:08:20.720 course a former ambassador with work in Northern Ireland a 0:08:20.800 --> 0:08:36.079 few years ago in our studios in New York. Right now, 0:08:36.080 --> 0:08:39.160 we are thrilled to bring you Horondo Rodriguez with black Rock, 0:08:39.720 --> 0:08:43.120 but more importantly with immense public service to finance and 0:08:43.160 --> 0:08:47.680 Treasury for the government of Mexico and uh out of 0:08:47.720 --> 0:08:51.440 Stanford and economic systems and operation research as a Horodo. 0:08:51.480 --> 0:08:53.960 We were talking earlier about Mexico, but we really didn't 0:08:54.000 --> 0:08:58.000 get the NAFTA to President Trump caused damage with a 0:08:58.040 --> 0:09:02.120 relationship with Mexico. This they have nft off and then 0:09:02.120 --> 0:09:06.560 left back on. I think that, um, what he did 0:09:06.880 --> 0:09:11.200 is introduced an additional element of uncertainty that had been 0:09:11.960 --> 0:09:19.160 going away. Um. Mexico again is not considered political or 0:09:19.160 --> 0:09:24.240 economic threat by any relevant political constituency in the US. 0:09:24.559 --> 0:09:27.200 It is a country that has been a strategic ally 0:09:27.480 --> 0:09:31.280 in liberal matters when it comes to trade, when the 0:09:31.320 --> 0:09:34.760 world when when the US engages with the rest of 0:09:34.840 --> 0:09:39.640 the world. So that the work that has been done 0:09:39.679 --> 0:09:44.000 on both sides prior to the recent comments is one 0:09:44.840 --> 0:09:50.520 of preparing institutions, preparing Congress for an upcoming negotiation. There 0:09:50.600 --> 0:09:54.280 is a clear interest to improve NAFTA, and these in 0:09:54.320 --> 0:09:57.800 a way is just sending a message that you've gotta 0:09:57.840 --> 0:10:00.720 be careful because surprise may comment use. Three or four 0:10:00.800 --> 0:10:03.960 years ago, Mexico was opposed to child for an eleven success. 0:10:04.160 --> 0:10:06.880 Is that success still there? I think I'm a growth 0:10:06.880 --> 0:10:10.760 of Mexico. I think it is, But other things have 0:10:10.920 --> 0:10:14.040 happened at the same time. Mexico sort of stood out 0:10:14.120 --> 0:10:18.640 because of its reform impetus, not only the willingness but 0:10:18.720 --> 0:10:22.960 the capacity to push through several reforms of the constitutional 0:10:23.040 --> 0:10:28.040 and legal level, opening up the energy sector, telecoms, competition label, 0:10:28.600 --> 0:10:32.840 and other things. Now, at the same time, what has 0:10:32.920 --> 0:10:37.520 happened is that oil prices and oil production in Mexico 0:10:37.559 --> 0:10:42.720 decline significantly, creating macroeconomic challenge especially on the fiscal side, 0:10:42.760 --> 0:10:46.680 that have been starting to be addressed, But at the 0:10:46.720 --> 0:10:52.080 same time also challenges on corruption matters at the federal 0:10:52.200 --> 0:10:58.600 and state government level have actually created a political environment 0:10:58.760 --> 0:11:01.880 where the popularity of the president is at all time 0:11:02.000 --> 0:11:07.680 lows and in anticipation of next year's presidential election. Clearly 0:11:07.880 --> 0:11:13.079 the left wing candy they UH left wing party candidate 0:11:13.320 --> 0:11:18.320 has been benefiting from all these sort of UH social 0:11:18.400 --> 0:11:21.800 dynamics in Mexico. Where is their their opportunity right now? Yes, 0:11:21.840 --> 0:11:24.480 in Mexico, but in Latin American more generally, when you're 0:11:24.480 --> 0:11:26.880 when you're looking at where to investor, you're looking at corporate, 0:11:26.920 --> 0:11:29.800 so you're looking at sovereign's what's attractive to you. So 0:11:29.960 --> 0:11:33.640 clearly as you say that the Mexican peso, with the 0:11:33.679 --> 0:11:37.440 weakness around these commerses, is clearly one of the most 0:11:37.559 --> 0:11:40.720 attractive investment opportunities that we see out there in the 0:11:40.800 --> 0:11:44.520 emerging world. We like Colombia as well. Columbia is an 0:11:44.600 --> 0:11:49.240 interesting a case where the macro rebalancing after major shocks 0:11:49.240 --> 0:11:55.800 both on production and other agricultural elements, have forced a 0:11:55.880 --> 0:12:00.520 significant adjustment of the external and physical accounts. In UH Colombia, 0:12:00.600 --> 0:12:03.720 the central Bank is in the middle of an aggressive 0:12:03.920 --> 0:12:09.800 easing cycle, so long term rates in Colombia is actually 0:12:10.320 --> 0:12:12.760 something that we like. We like Brazil on the equity 0:12:12.800 --> 0:12:17.480 side as well, the very aggressive easing cycled by a 0:12:17.520 --> 0:12:21.000 central bank. I mean they're lowering a hundred basis points 0:12:21.040 --> 0:12:24.400 per meeting, perhaps going to a hundred and twenty five 0:12:25.240 --> 0:12:29.079 next meeting. It is an economy that has turned the corner. 0:12:30.120 --> 0:12:33.800 The country has also turned the corner politically. It's starting 0:12:33.840 --> 0:12:36.680 to get ready for the next year's presidential election. And 0:12:36.720 --> 0:12:41.000 although the economy is somewhat of flatlining at this point, 0:12:41.040 --> 0:12:45.800 the prospects of reform to restart economic growth in Brazil 0:12:46.000 --> 0:12:50.040 is looking good. It is clearly one of our topics 0:12:50.120 --> 0:12:54.679 on the equity side, Brazilian equity markets. Thank you so much. 0:12:55.880 --> 0:12:58.440 Quickly this wanting too quick with black Rock as well 0:12:58.440 --> 0:13:00.240 in Mexico, Thank you so much. And the course on 0:13:00.280 --> 0:13:10.280 Emerging Markets with black Rock Worldwide, brought to you by 0:13:10.520 --> 0:13:14.199 Bank of America. Mary Lynch dedicated to bringing our clients 0:13:14.320 --> 0:13:18.520 insights and solutions to meet the challenges of a transforming world. 0:13:18.960 --> 0:13:22.679 That's the power of global connections. Mary Lynch, Pierce, Feeder 0:13:22.760 --> 0:13:32.240 and Smith Incorporated Member s I p C. There's something 0:13:32.280 --> 0:13:35.680 new from Bloomberg. It's called Lens. Starting right now, you 0:13:35.720 --> 0:13:38.960 can use the Bloomberg Io s app off your iPhone 0:13:39.080 --> 0:13:43.680 or iPad or our new Google Chrome Extension to read 0:13:43.760 --> 0:13:47.679 any news story on any website, scan it, and then 0:13:47.720 --> 0:13:51.880 instantly see the news stories relevant market data from Bloomberg. 0:13:52.160 --> 0:13:55.280 In addition, see all the bios of the key people 0:13:55.720 --> 0:13:58.920 mentioned in the story. It's called Lens, and it is 0:13:59.000 --> 0:14:02.080 just that, a lens into the people and the data 0:14:02.200 --> 0:14:06.440 of any story you may be reading. Again. Lens brings 0:14:06.440 --> 0:14:09.720 you the power of Bloomberg's news and data. Download or 0:14:09.720 --> 0:14:13.120 io s app or search for the Bloomberg extension at 0:14:13.120 --> 0:14:16.440 the Chrome Store to try lens out. Learn more at 0:14:16.480 --> 0:14:24.000 Bloomberg dot com slash lens. Join me here in our 0:14:24.000 --> 0:14:27.160 Bloomberg ninty nine studios. Now is Zekemmanuel, healthcare expert zekem Manual, 0:14:27.200 --> 0:14:30.440 Professor of healthcare Management at the University of Pennsylvania. As 0:14:30.440 --> 0:14:32.800 we look at what's happening on a Capitol Hill, there 0:14:32.800 --> 0:14:34.720 was some optimism in the Republican camp that there would 0:14:34.720 --> 0:14:36.880 be the votes needed to get their legislation through this week. 0:14:36.880 --> 0:14:39.400 It seems that last night all of that change. There 0:14:39.440 --> 0:14:41.360 will not be a vote here this week. The House 0:14:41.440 --> 0:14:43.920 leadership saying, Zeke Manuel, great to have you you with us, 0:14:43.920 --> 0:14:46.000 get us up to speed. You've been talking to to lawmakers. 0:14:46.040 --> 0:14:48.920 What's what's the objective here? Is is policy driving? This 0:14:49.040 --> 0:14:51.840 is politics driving this? What what Republicans hope to do? 0:14:51.880 --> 0:14:54.360 Where is their agreement between these two sides. This is 0:14:54.400 --> 0:14:58.560 definitely not about policy. The two point oh Republican reform 0:14:58.600 --> 0:15:02.440 bill is, if any worse than one point oh uh, 0:15:02.480 --> 0:15:05.880 and so it's gonna have a hard time. I don't 0:15:05.880 --> 0:15:08.560 think there's as much attention on it. But um, moderate 0:15:08.600 --> 0:15:11.680 Republicans do not like it. It doesn't bode well for 0:15:11.760 --> 0:15:14.520 them in the election. The public doesn't like it because 0:15:14.520 --> 0:15:17.200 what the public is concerned about is the high costs 0:15:17.240 --> 0:15:21.360 of healthcare. They're concerned about high deductibles, high copayments, high 0:15:21.480 --> 0:15:25.360 drug costs, and this bill does absolutely nothing on that. 0:15:25.720 --> 0:15:28.360 And so I think this builds chance of success are 0:15:28.640 --> 0:15:31.680 law I was not at all surprised that, in fact, 0:15:32.000 --> 0:15:34.360 they didn't. They pulled a vote because they don't have 0:15:34.440 --> 0:15:36.040 the votes, and they're not going to have the votes, 0:15:36.080 --> 0:15:39.040 and I've predicted that they won't pass anything, and hopefully 0:15:39.040 --> 0:15:42.600 after we go through this feudal exercise a few more times, 0:15:43.040 --> 0:15:46.560 we will actually get too serious negotiations about policy and 0:15:46.600 --> 0:15:49.960 about what to do about the state of healthcare. There 0:15:50.040 --> 0:15:52.880 was a great piece by bloom Review. Comes Peter Rizager 0:15:53.360 --> 0:15:55.760 looking at this and saying, if if you want by partisanship, 0:15:55.800 --> 0:15:57.640 if you want something to happen, focus here on containing 0:15:57.680 --> 0:16:00.640 consts and improving value. Is that the problem of the 0:16:00.760 --> 0:16:02.800 legislature is that where that needs to happen or can 0:16:02.800 --> 0:16:05.800 it happen elsewhere? Well, there are some things the administration 0:16:05.840 --> 0:16:09.160 can do from a regulatory basis, and UH that you 0:16:09.200 --> 0:16:13.400 know that those are would be good. Unfortunately, Secretary Price 0:16:13.880 --> 0:16:16.280 put on hold some of those changes when he put 0:16:16.280 --> 0:16:20.720 on hold introducing the bundled payments for cabbage bypass surgery 0:16:20.720 --> 0:16:23.640 and acute my cardial infarction. We need those bundle payments, 0:16:23.720 --> 0:16:26.920 we need different ways of paying um, and we should 0:16:26.920 --> 0:16:29.920 not put them on hold for re examination. I think 0:16:30.680 --> 0:16:33.120 over the long term, UH, costs are going to be 0:16:33.160 --> 0:16:36.120 the key thing that Americans care about, and I would 0:16:36.120 --> 0:16:40.200 just have your listeners remember Massachusetts in two thousand and six, 0:16:40.280 --> 0:16:43.520 they began this sort of universal coverage approach. They've gotten 0:16:43.840 --> 0:16:48.440 pretty well, they're sort of covered in Massachusetts. And then 0:16:48.480 --> 0:16:51.800 once you get coverage, you then automatically more or less 0:16:51.800 --> 0:16:54.440 shift to costs and trying to get costs under control 0:16:54.680 --> 0:16:57.200 and I think that's where we are in the United States. 0:16:57.480 --> 0:17:00.080 We did the Coverage Bill. It's not perfect, but it 0:17:00.160 --> 0:17:03.120 actually advanced things pretty well. We're about ten percent uninsured 0:17:03.120 --> 0:17:06.440 in the country now, um and so naturally people, I've 0:17:06.480 --> 0:17:09.440 got coverage, but it's really hard and expensive to use, 0:17:09.480 --> 0:17:12.000 and let's get the system better, both in terms of 0:17:12.040 --> 0:17:14.240 costs and in terms of quality. And that's I think 0:17:14.240 --> 0:17:16.520 the natural progression of these debates. It strikes me that 0:17:16.560 --> 0:17:19.439 the chief challenge here as Republican lawmakers look at this, 0:17:19.480 --> 0:17:21.479 is there aren't components of the affordable caring that are 0:17:21.520 --> 0:17:24.640 well liked by a lot of people. Be that letting 0:17:24.640 --> 0:17:26.600 your kids stay on your plan until he's X age, 0:17:26.760 --> 0:17:29.120 be that not having to worry about pre existing conditions 0:17:29.520 --> 0:17:33.000 that makes reform difficult. Having those things that everyone seems 0:17:33.000 --> 0:17:35.800 to like, well for Bloomberg people. You guys know behavioral 0:17:35.800 --> 0:17:38.760 economics pretty well, and there's something called loss of version. 0:17:38.800 --> 0:17:41.400 Once I have something, I don't like it being taken away, 0:17:41.760 --> 0:17:44.320 and that's what we're seeing with healthcare. Oh, I got 0:17:44.400 --> 0:17:46.399 have this health insurance. I don't like it taken away. 0:17:46.600 --> 0:17:48.800 I have the safety net under me that if you know, 0:17:48.840 --> 0:17:51.800 God forbid, my employer pulls the insurance or I become unemployed, 0:17:51.880 --> 0:17:53.320 or I want to start my own company. I have 0:17:53.400 --> 0:17:55.879 the safety that I can get coverage. People don't like 0:17:55.960 --> 0:17:58.440 that being taken away, but they also want it now 0:17:58.480 --> 0:18:01.199 to be affordable. And they've their drug prices go up. 0:18:01.240 --> 0:18:03.600 They've seen the deductive bowls go up, and they are 0:18:03.720 --> 0:18:05.840 very upset by that. So I think that's our next, 0:18:06.280 --> 0:18:08.720 our next phase. Tom Keene in New York City with 0:18:08.800 --> 0:18:14.840 John Tucker, wonderful spring morning. It's beautiful. David's in Washington. 0:18:15.040 --> 0:18:17.600 David's in Washington, And don't let our steam guests know 0:18:18.000 --> 0:18:20.840 that the only reason we booked him was because maybe 0:18:20.880 --> 0:18:26.040 he can get US Cubs tickets. I possibly we'll broker that. 0:18:26.160 --> 0:18:28.159 We'll broker that during the next break. Zac Comnuel with 0:18:28.240 --> 0:18:31.280 us here, professor of healthcare management at the University of Pennsylvania, 0:18:31.359 --> 0:18:33.879 joining us in our Bloomberg Students time. I know you 0:18:33.920 --> 0:18:35.520 want to talk about insurance here in just a moment, 0:18:35.520 --> 0:18:38.679 but Zeke, let me ask you about lobbying might in 0:18:38.720 --> 0:18:41.360 this town during the Trump administration. Every article I read 0:18:41.359 --> 0:18:43.760 about what's been happening on Capitol Hill says special interest 0:18:43.760 --> 0:18:46.040 groups have been key in scuttling this or pushing it 0:18:46.080 --> 0:18:48.920 one way or another. How does healthcare lobbying look look 0:18:48.960 --> 0:18:52.080 to you? And the year two thousand seventeen, it's pretty 0:18:52.080 --> 0:18:56.040 intense as usual and getting the right people, uh to 0:18:56.160 --> 0:18:59.240 listen to you. The drug companies still have a lot 0:18:59.280 --> 0:19:02.360 of might. But you know, one of the reasons I think, 0:19:02.400 --> 0:19:05.120 for example, this Republican proposal is not doing so well 0:19:05.200 --> 0:19:07.080 is the fact that the A m A, the American 0:19:07.080 --> 0:19:10.119 Hospital Association a r P, and a whole slew of 0:19:10.119 --> 0:19:13.080 other people in the healthcare industry are against it. They 0:19:13.160 --> 0:19:17.320 want the exchanges shored up, and uh, this bill doesn't 0:19:17.359 --> 0:19:20.040 do that, and so they've come out strongly against it. 0:19:20.119 --> 0:19:24.080 And so when you've got all the healthcare industry against it, uh, 0:19:24.119 --> 0:19:27.640 and uh, you know, it's a hard, uphill fight. Zeke 0:19:27.680 --> 0:19:30.200 help us here into the weekend. And that I see 0:19:30.359 --> 0:19:35.480 map aftermap of regions of the nation with four insurers, 0:19:35.560 --> 0:19:40.359 three insurers, two insurers, one insurer, and the scary thought 0:19:40.400 --> 0:19:44.560 of no insure under the Affordable Care Act. What do 0:19:44.640 --> 0:19:48.480 those insurers want? Do they want to be part of 0:19:48.520 --> 0:19:51.160 the Affordable Care Act? Or is this just an excuse 0:19:51.200 --> 0:19:53.720 to run Well, let me let me make two points. First, 0:19:53.760 --> 0:19:56.680 if you look at Anthem recently reported that they're doing 0:19:56.680 --> 0:19:59.920 well and the exchanges, thank you very much. Despite all 0:20:00.160 --> 0:20:02.760 chatter out there, most of the insurance companies who are 0:20:02.760 --> 0:20:06.800 participating are doing okay. Uh. They raised their rates and 0:20:06.840 --> 0:20:09.920 they got that matched their risk pool, and so they're 0:20:09.960 --> 0:20:13.400 doing okay. The big problem is insurance hate uncertainty, and 0:20:13.440 --> 0:20:15.000 what we have and how is a huge amount of 0:20:15.040 --> 0:20:20.399 uncertain Three things would actually make them much happier and 0:20:20.480 --> 0:20:25.320 therefore would bring rates down. Uh, and certainly rate increases down. First, 0:20:25.480 --> 0:20:27.920 say you're gonna enforce the individual mandate so that you 0:20:28.000 --> 0:20:30.880 get more young people coming in, and don't say you're 0:20:30.920 --> 0:20:33.439 not going to enforce it and not impose penalties and 0:20:33.640 --> 0:20:41.520 undermine the situation. Second, we need risk corridors and reinsurance payments. Uh. 0:20:41.560 --> 0:20:46.200 Those were scuttled by our good friend Senator Rubio. Uh. 0:20:46.480 --> 0:20:50.040 Those are very important in case a insurance company gets 0:20:50.040 --> 0:20:53.560 a disproportionate number of sick people. That again brings rates down. 0:20:53.800 --> 0:20:57.400 Sometimes I've heard as much as five uh. And then 0:20:57.440 --> 0:21:00.560 the third element is these cost sharing subsidies. So for 0:21:00.640 --> 0:21:04.240 families in America earning up to two of poverty who 0:21:04.240 --> 0:21:07.800 are on the exchanges that means they're earning sixty roughly 0:21:07.960 --> 0:21:11.359 or less um. They get help paying the deductibles and 0:21:11.359 --> 0:21:15.200 the code pays um. And if they don't, uh get 0:21:15.240 --> 0:21:17.920 government support for that. The insurance companies around the hook 0:21:17.920 --> 0:21:20.679 and they're like, oh, why should I participate? And the 0:21:20.720 --> 0:21:23.000 Republicans say, oh, we'll decide those on a month to 0:21:23.080 --> 0:21:27.080 month basis. That that is no good for literally no 0:21:27.200 --> 0:21:29.920 help for insurance company. And again that's worth another ten 0:21:30.000 --> 0:21:32.800 percent on the premiums. So you want to get premiums down, 0:21:33.040 --> 0:21:36.520 attract insurance companies in because the market is stable. You 0:21:36.600 --> 0:21:40.240 have to do those three kings. And you know, and 0:21:40.240 --> 0:21:43.440 they're not by the way, Tom, they're not complicated. Everyone 0:21:43.520 --> 0:21:46.680 knows they're there um. And if you you know, if 0:21:46.720 --> 0:21:49.760 the Republicans upset the market by not paying the cost 0:21:49.760 --> 0:21:53.240 sharing subsidies, not enforcing the mandate, everyone knows who knows 0:21:53.240 --> 0:21:56.000 who's at fault. Now, when you control all branches of government, 0:21:56.000 --> 0:21:57.399 you can't point the finger and say, oh, it's a 0:21:57.400 --> 0:22:00.439 Democrats problem. No, you have the power to solve the problem. 0:22:00.720 --> 0:22:03.320 You have to solve it. My theme for the first 0:22:03.400 --> 0:22:06.359 hundred days has been the phrase the minority majority Party 0:22:06.400 --> 0:22:10.200 and that's a Republican party struggling with leadership and governance, 0:22:10.240 --> 0:22:12.960 and what what is their majority position going to be? 0:22:13.440 --> 0:22:17.080 What do the moderate Republicans want out of the Zeka 0:22:17.160 --> 0:22:21.960 Manuel world? What's their best outcome? I think the best 0:22:22.000 --> 0:22:26.719 outcome is let's fix the Affordable Care Act UH and 0:22:26.880 --> 0:22:30.639 get what's working working, and let's get some meaningful cost 0:22:30.680 --> 0:22:34.080 control enacted that will actually, over the long home the 0:22:34.119 --> 0:22:38.520 next four or five years, get costs down to growing 0:22:38.800 --> 0:22:41.399 so healthcare costs doesn't don't go any faster than the 0:22:41.440 --> 0:22:46.280