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Trump Trade Moves Worry GOP · Balance of Power

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  Speaker 1: Thanks for being with us here on the Wednesday edition
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  Speaker 1: of Balance of Power on Bloomberg TV and radio alongside
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  Speaker 1: Tyler Kendall. I'm Joe Matthew in Washington. As we dissect
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  Speaker 1: the data, if there's any point to it, we're in
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  Speaker 1: a world here where everyone's so obsessed with Jackson Hole
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  Speaker 1: at the end of the week that, well, of course,
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  Speaker 1: they're parsing through each data point. But then again, no
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  Speaker 1: one knows how to react to it because we're all
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  Speaker 1: waiting for the Fed chair to speak on Friday. Yields
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  Speaker 1: are moving a little bit. Long bond up a couple ticks,
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  Speaker 1: 518 on the 30-year, the 10 years at 466, up
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  Speaker 1: four ticks, the two-year, 422. Everyone's been talking about the
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  Speaker 1: 30-year mortgage, 6.7%, and when this is all going to break.
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  Speaker 1: You can make the argument, Tyler, that this data reinforces
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  Speaker 1: the Fed's view that it can keep rates unchanged for
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  Speaker 1: the foreseeable future.
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  Speaker 5: Right. There's a lot that, as you're outlining, we're going
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  Speaker 5: to need to parse through here. But then the other
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  Speaker 5: side are those questions about what the future of the
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  Speaker 5: economy's growth is going to look like, and in particular,
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  Speaker 5: consumer spending, and whether or not we're seeing in this
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  Speaker 5: data what is perhaps a front-loading from the World Cup.
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  Speaker 5: a couple of months ago, or if this is a
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  Speaker 5: more durable slowdown. So there's a lot of that we
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  Speaker 5: need to parse through. But you're right, it's all leading
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  Speaker 5: up until Friday. And what is Kevin Warsh going to
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  Speaker 5: say to reassure investors?
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  Speaker 1: If anything, there are two camps on this, it seems.
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  Speaker 1: One is nothing burger. He doesn't make any news, which
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  Speaker 1: is sometimes the Fed chair's job. Or does he need
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  Speaker 1: to lay down a marker and make a very stern
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  Speaker 1: point for this market that he is here to fight inflation?
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  Speaker 1: We remember how that went last time, and I bet
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  Speaker 1: Liz Pancotti does as well. Great to have her back.
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  Speaker 1: Vice President Policy, Advocacy, and Research at the Groundwork Collaborative. Liz,
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  Speaker 1: it's good to see you. I'd also throw another item
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  Speaker 1: on this whole story, and that's a $ 40 trillion federal debt.
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  Speaker 1: How do you compile all this data and concerns about
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  Speaker 1: our fiscal straits with your eyes on Jackson Hole on Friday?
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  Speaker 6: I think both with our eyes on Jackson Hole from
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  Speaker 6: potentially a Fed chair who is going to be quite silent,
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  Speaker 6: combined with Congress who seems more interested in blowing a
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  Speaker 6: hole in our revenue streams than in plugging them together,
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  Speaker 6: the economy doesn't look so great right now. I think
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  Speaker 6: the big question for Kevin Warsh is how he plans
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  Speaker 6: to use the couple of tools the Fed has to
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  Speaker 6: actually fight the inflation that we're seeing as the president
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  Speaker 6: adds additional tariffs on Canada, sanctions on Iran. We know
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  Speaker 6: that that interest rates as a blunt instrument are really
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  Speaker 6: not one that can bring down that type of sticky
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  Speaker 6: inflation coupled with rising oil prices. Given his conflict in
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  Speaker 6: the Middle East, I think, you know, though Kevin's hands
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  Speaker 6: might be tied on the on the Fed's tools in
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  Speaker 6: the wake of the data that we're seeing, his lips
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  Speaker 6: seem to be sealed as well, which doesn't give a
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  Speaker 6: lot of confidence to markets at this point.
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  Speaker 5: Liz, what is the biggest upside risk to inflation over
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  Speaker 5: the next three to six months? Shelter, wages, you mentioned
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  Speaker 5: this now, renewed trade conflict with Canada, and also the
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  Speaker 5: fact that we are still seeing those tensions in the
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  Speaker 5: Middle East.
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  Speaker 6: My big concern is that, you know, I think we
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  Speaker 6: had this exact conversation in February or March where we said,
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  Speaker 6: if the war in Iran comes to a close here
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  Speaker 6: in the next six weeks, eight weeks, we won't see
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  Speaker 6: sustained price pressures from the war. We are now six
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  Speaker 6: months into that war. There is no durable end in sight.
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  Speaker 6: You know, whatever the ceasefire talks are, if they're happening,
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  Speaker 6: they aren't sticking. So I think that pressure is here
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  Speaker 6: to stay, and we are certainly going to see those
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  Speaker 6: effects flow into plastics, fertilizers, and groceries over the coming year,
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  Speaker 6: just as all of that works out, even if the
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  Speaker 6: war ended tomorrow. And I think on top of that,
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  Speaker 6: with the president threatening additional tariffs on Canada here in
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  Speaker 6: the next 10 days— um, in, in the coming, in, in,
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  Speaker 6: at the start of 2027. And then with those additional
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  Speaker 6: targeted sectoral investigations still on at USTR, um, consumers or
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  Speaker 6: businesses have any reason to believe that relief from tariffs
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  Speaker 6: is on the way. And so those are the two
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  Speaker 6: biggest upside risks to inflation.
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  Speaker 1: Well, okay, Liz, I mean, with, with that answer, then
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  Speaker 1: how could the fed avoid raising interest rates at some
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  Speaker 1: point in the months ahead?
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  Speaker 6: I think the big question is how much do they
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  Speaker 6: care about the labor market? And Kevin Warsh basically, to
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  Speaker 6: the extent he said anything since taking office, he said
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  Speaker 6: that American workers really aren't his concern. His bigger concern
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  Speaker 6: is bringing down inflation, though he's hesitant to increase rates
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  Speaker 6: given whatever promises he made in the interview process with
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  Speaker 6: President Trump. And I think as a result, what we're
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  Speaker 6: likely to see is paychecks that continue to shrink and
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  Speaker 6: prices that continue to rise. And if you're a business
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  Speaker 6: trying to navigate this environment, it's impossible to make long-term
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  Speaker 6: decisions like hiring or CapEx investments unless you're a data center,
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  Speaker 6: which is driving about 60% of GDP growth in this
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  Speaker 6: morning's report.
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  Speaker 3: Wow.
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  Speaker 5: Well, let's maybe pick up on data centers and maybe
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  Speaker 5: also NVIDIA's earnings today, too, and how much that is
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  Speaker 5: going to tell us about the AI investment cycle.
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  Speaker 7: What are you watching for, Liz?
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  Speaker 6: I think actually the thing that I'm most concerned about
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  Speaker 6: is the inflation we're seeing from all of this data
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  Speaker 6: center build out. I really worry that we are headed
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  Speaker 6: back into the chips crisis that we saw in 22
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  Speaker 6: and 23, where we simply don't have enough of the
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  Speaker 6: memory chips we need to serve things like consumer electronics, autos,
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  Speaker 6: et cetera, plus on top of that, these massive investments
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  Speaker 6: in data centers. The moratorium conversation is interesting. Will that
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  Speaker 6: slow the build out of these? I'm not convinced based
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  Speaker 6: on what we've seen so far. And at the end
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  Speaker 6: of the day, who's left holding the bag for the
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  Speaker 6: massive shareholder returns we're seeing these companies deliver? Right now,
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  Speaker 6: it seems to be commercial and residential electricity rate payers,
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  Speaker 6: which is just another price increase that I think so
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  Speaker 6: many of these balance sheets can't take right now.
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  Speaker 5: Wow.
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  Speaker 1: I'm glad you went there, Liz. I mean, we've already
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  Speaker 1: seen the impact on memory, for instance. Apple's talking to
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  Speaker 1: the Chinese about getting cheaper chips so they don't have
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  Speaker 1: to hike the price of the iPhone. But does it
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  Speaker 1: go beyond that? This massive AI data center spend, which
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  Speaker 1: has become a huge issue on the political campaign trail,
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  Speaker 1: could send prices down. of so many things higher, right?
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  Speaker 1: Raw materials, lumber, concrete, steel, all are needed to build
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  Speaker 1: these enormous complexes.
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  Speaker 7: That's right.
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  Speaker 6: I mean, even chemicals like coolants for many of these buildings, piping.
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  Speaker 6: We've seen the aluminum market across the globe really in
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  Speaker 6: calamity over the past two years or so.
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  Speaker 7: The same copper.
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  Speaker 6: I think in commodity markets, we're seeing the after effects
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  Speaker 6: of all of the terrorists, the war in Iran, supply
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  Speaker 6: chain crises made even worse by the fact that one
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  Speaker 6: industry is really doing all of the capex right now.
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  Speaker 6: And those supply chains are incredibly complicated. They are global
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  Speaker 6: in nature. They are very intertwined. There are lots of
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  Speaker 6: parts that need to be put together. And I think
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  Speaker 6: the big question there is how far can they go
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  Speaker 6: before they really hit a wall? You know, can Apple
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  Speaker 6: diversify its supply chains before it runs into the fact
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  Speaker 6: that tariffs will need to balance out if they're going
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  Speaker 6: to import more from China? I think right now companies
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  Speaker 6: are trying to solve for an equation with 1900 variables
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  Speaker 6: that all seem to move every time the president logs
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  Speaker 6: on to Truth Social.
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  Speaker 1: Liz, it's great to have you back. Liz Pencotti, Groundwork Collaborative.
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  Speaker 1: Let's Stay with this data center issue. Tyler, we're going
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  Speaker 1: to assemble the political panel in just a moment. Rick
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  Speaker 1: and Jeannie will have thoughts on this because we spoke
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  Speaker 1: to Ted Cruz about this last evening. Of course, the
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  Speaker 1: Republican senator from Texas, knowing that Governor Greg Abbott has
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  Speaker 1: put some restrictions or at least reviews around proposed data
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  Speaker 1: centers in rural areas as opposed to the moratorium put
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  Speaker 1: in place in a state like New York. Here's how
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  Speaker 1: Cruz sees it should work.
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  Speaker 8: I agree with what Governor Abbott has said, which is
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  Speaker 8: no new data center will be built in Texas unless
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  Speaker 8: the impact of that data center is zero, is absolutely
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  Speaker 8: not one penny added to anyone's electricity bills.
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  Speaker 2: I think that makes sense.
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  Speaker 8: And I'll tell you, I'm urging the companies that are
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  Speaker 8: building these data centers go further than that. Make the
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  Speaker 8: benefits absolutely clear and indisputable. I'm urging them, send checks
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  Speaker 8: to the residents of the community. Send them $ 100 a month.
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  Speaker 8: Send them $ 500 a month. Send them $ 1, 000 a month.
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  Speaker 8: Or even better, say if we build a data center
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  Speaker 8: in your community, for the rest of your life, your
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  Speaker 8: electricity bill is free. We will pay your electricity bill.
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  Speaker 8: That's how you win the PR battle.
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  Speaker 1: Got to tell you, Tyler, it kind of rings true.
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  Speaker 5: Yeah.
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  Speaker 1: No electricity bill for the rest of your life?
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  Speaker 5: Yeah.
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  Speaker 1: All of a sudden, a data center shows up.
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  Speaker 5: We're seeing both parties not have a continuous message on it.
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  Speaker 5: It is on both sides of the aisle, Republican and
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  Speaker 5: Democratic governors trying to figure this out, and candidates that
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  Speaker 5: aren't even in office yet trying to figure this out. Joe,
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  Speaker 5: I pulled one poll, a June poll from Reuters. Only
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  Speaker 5: one in three Americans approve of how quickly data centers
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  Speaker 5: are going up across the country.
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  Speaker 1: Even those who've never seen one in their lives. Let's
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  Speaker 1: get to the political panel. As we mentioned, Bloomberg Politics
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  Speaker 1: contributors Jeanne Shanzano and Rick Davis are with us. Jeanne
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  Speaker 1: is our Democratic Analyst and Democracy Visiting Fellow at Harvard Kennedy.
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  Speaker 1: School's Ash Center. Rick is our Republican Strategist, of course,
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  Speaker 1: and a partner at Stonecourt Capital. What'd you make of that, Jeanne?
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  Speaker 1: Is that the future? Nobody has to pay their electric
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  Speaker 1: bills anymore. It's open season.
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  Speaker 3: Wouldn't that be nice? You know, I think what struck me,
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  Speaker 3: it was such a fascinating interview with Senator Cruz. Number one,
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  Speaker 3: he was empathetic to all the concerns, and I think
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  Speaker 3: rightly so, as has Governor Abbott and so many governors
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  Speaker 3: across the country. But what was stunning to me was
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  Speaker 3: when he talked about this as a PR problem. And that,
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  Speaker 3: I think, is an indication that they aren't, or he
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  Speaker 3: isn't understanding the seriousness with which, in a bipartisan way,
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  Speaker 3: communities Whether it's in Salt Lake City, whether it's in Virginia, Texas,
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  Speaker 3: New York, around the country are pushing back. There's so
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  Speaker 3: many issues that are of concern to people. Number one
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  Speaker 3: has been the lack of transparency in these deals. The
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  Speaker 3: fact that many of them have been made under NDAs
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  Speaker 3: without public input. I noticed he talked a little bit
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  Speaker 3: about here's an answer to the water problem, this closed
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  Speaker 3: loop cooling technologies. Well, anybody who understands those will tell
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  Speaker 3: you that increases the energy costs so much. It creates
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  Speaker 3: chemical risk concerns, right? So all of these things he's
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  Speaker 3: talking about as a PR move, I don't think is
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  Speaker 3: addressing the scope and the reality of the concerns that
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  Speaker 3: people have in the poll that Tyler just mentioned.
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  Speaker 5: So then, Rick, what is the balancing act here when
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  Speaker 5: on the other side of that argument you have some,
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  Speaker 5: including the president, talk about the potential benefits to local communities,
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  Speaker 5: such as job growth? How do politicians navigate that divide?
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  Speaker 9: Yeah, I think you're seeing the first step of that,
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  Speaker 9: which is trying to address the fear that the public has,
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  Speaker 9: because there's a lot of people who just don't understand
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  Speaker 9: what the issues are related to data centers themselves, because
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  Speaker 9: most of America hasn't seen one, so they haven't experienced it.
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  Speaker 2: And two, there's a lot of fear about AI in general, right?
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  Speaker 9: What undergirds all of these discussions about AI? data centers is,
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  Speaker 9: what's AI going to do to my job? What's AI
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  Speaker 9: going to do to our culture? What's AI going to
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  Speaker 9: do to the future of our country? And so you
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  Speaker 9: create a lot of anxiety. And so addressing that fear
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  Speaker 9: and anxiety, I think, is the number one thing. And
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  Speaker 9: I think that's what you saw Senator Cruz doing. Nobody's
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  Speaker 9: got real answers because they don't really know what the
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  Speaker 9: scope of the problem is yet, and especially when it
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  Speaker 9: comes to these communities. So A patchwork effort of trying
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  Speaker 9: to get soundbites to appease people is simply not going
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  Speaker 9: to get it done. It's going to have to be
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  Speaker 9: in a conversation that the public officials have with the
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  Speaker 9: general public about how to handle this going forward. Do
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  Speaker 9: we want to be more competitive with China? Then we're
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  Speaker 9: going to have to build data centers. Where we build
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  Speaker 9: data centers is what we're going to do. Could you
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  Speaker 9: imagine an electricity tax-free zone in your neighborhood in Texas?
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  Speaker 2: Where does it start? Where does it stop?
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  Speaker 9: Can I build a house on one side of the
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  Speaker 9: road and get the tax-free status? I mean, we're unleashing
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  Speaker 9: a debate that's going to last a long time and
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  Speaker 9: have a lot of victims.
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  Speaker 1: Well, OK. And I'll tell you, if it isn't. A
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  Speaker 1: PR campaign here, Jeannie. You wonder what it is that
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  Speaker 1: will win people over beyond buying them off. Axios put
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  Speaker 1: together some fascinating stats. In case you were wondering, there
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  Speaker 1: are about 4,000 data centers across the country, 580 hyperscale facilities,
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  Speaker 1: at least 75 totaling $ 130 billion in potential investment impacted
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  Speaker 1: in the first quarter of this year. Interesting on the jobs, though, Jeannie.
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  Speaker 1: We hear a lot about job creation. That's typically the
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  Speaker 1: angle that the president seizes on. About 1,500 workers at
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  Speaker 1: the peak are employed to build the data center. That's
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  Speaker 1: about 12 to 18 months of construction. You know how
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  Speaker 1: many are left to run the data center? This is
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  Speaker 1: based on what we've seen in Virginia, where we've had
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  Speaker 1: these around for a long time.
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  Speaker 2: 50, 5-0.
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  Speaker 1: Is this a job story or not?
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  Speaker 3: It's a job loss story in the long term. And
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  Speaker 3: that's another thing that frustrates people. You know, part and
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  Speaker 3: parcel of a bigger picture in this is that many
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  Speaker 3: Americans are living at a time where they are worried
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  Speaker 3: that AI is going to take their jobs. And they are,
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  Speaker 3: quite frankly, sick and tired of tech billionaires telling them
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  Speaker 3: how they're going to live their lives.
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  Speaker 1: This explains a lot of.
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  Speaker 3: The pushback contained in the center's flat cameras, as we've
• 14:38
  Speaker 3: talked about. I think even the Meadows settlement today, these
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  Speaker 3: are proxies and there's real concerns underlying them, but proxies
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  Speaker 3: for real anger over tech. And at the core of
• 14:50
  Speaker 3: these issues have to be determined in Congress and by
• 14:54
  Speaker 3: our executive. And that is going to take time.
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  Speaker 2: And that's why we do need applause.
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  Speaker 8: All right.
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  Speaker 5: Our political panel, Rick Davis and Jeanne Shanzano, they'll be
• 15:03
  Speaker 5: staying with us throughout the hour.
• 15:05
  Speaker 1: Stay with us on Balance of Power. We'll have much
• 15:07
  Speaker 1: more coming up after this.
• 15:12
  Speaker 4: You're listening to the Bloomberg Balance of Power podcast. Catch
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• 15:27
  Speaker 1: Just say Alexa, play Bloomberg 1130. Tyler Kendall is with
• 15:32
  Speaker 1: us today in Washington in for Kaylee Lyons as we
• 15:35
  Speaker 1: consider the latest from the Middle East. And Tyler, there's
• 15:37
  Speaker 1: been some interesting reporting here Bloomberg as Iran's military says
• 15:41
  Speaker 1: it has reached a revenue-sharing agreement with Oman on the
• 15:44
  Speaker 1: Strait of Hormuz, the very thing that President Trump said
• 15:47
  Speaker 1: would be a non-starter for the U.S.
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  Speaker 5: And we should caution, the IRGC statement related to this
• 15:53
  Speaker 5: does go further than the joint statement that we got
• 15:56
  Speaker 5: from Iran and Oman, which said that this isn't finalized,
• 15:59
  Speaker 5: but it is pointing toward a Iran not giving up
• 16:02
  Speaker 5: its leverage when it comes to the Strait of Hormuz
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  Speaker 5: as the U.S. itself is trying to strengthen the economic
• 16:08
  Speaker 5: pressure on Iran to get them to the negotiations.
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  Speaker 1: Well, that's right. You remember economic D-Day. This would be
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  Speaker 1: D plus two, I guess, if we're keeping track, although
• 16:15
  Speaker 1: many have wondered. how this is going to work and
• 16:18
  Speaker 1: what Chinese entities have already been isolated and whether the
• 16:23
  Speaker 1: administration is willing to go further, Tyler, with secondary sanctions.
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  Speaker 1: This is all going to be playing out in the
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  Speaker 1: days ahead.
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  Speaker 5: Right, exactly, because we know that the U.S. has set
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  Speaker 5: out defined timelines for individual countries. And that's where we
• 16:33
  Speaker 5: would like to start by bringing in our next guest,
• 16:36
  Speaker 5: Ophir Falk, foreign policy advisor to Israeli Prime Minister Benjamin Netanyahu,
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  Speaker 5: joins us now live from Israel.
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  Speaker 6: Israel, Mr.
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  Speaker 5: Falk, thank you so much for joining us here on Bloomberg.
• 16:47
  Speaker 5: Let's start there and your thoughts on the U.S. 's
• 16:49
  Speaker 5: economic pressure campaign against Iran. Does Israel feel that this
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  Speaker 5: is the next best step in terms of the course
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  Speaker 5: of action to get Iran to the negotiating table? And
• 16:59
  Speaker 5: does Israel have a timeline, realistically, on when you think
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  Speaker 5: this will go into full effect?
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  Speaker 10: Well, thanks for having me, Tyler. We're all in favor
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  Speaker 10: for what President Trump's doing in the economic D-Day, so
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  Speaker 10: to speak. And the way we understand it is that
• 17:15
  Speaker 10: the friend of your enemy is your enemy. And you
• 17:18
  Speaker 10: can't have countries that are facilitating terrorist entities like Iran.
• 17:24
  Speaker 10: And we're all for these sanctions that are going to
• 17:28
  Speaker 10: be put on these countries.
• 17:33
  Speaker 5: Dr.
• 17:33
  Speaker 1: Falk, it's great to have you with us for the
• 17:35
  Speaker 1: sake of our conversation. Viewers and listeners, we should let
• 17:39
  Speaker 1: everyone know that you have been in the room with
• 17:41
  Speaker 1: the prime minister for some critical meetings and have been
• 17:45
  Speaker 1: one of his nearest advisors in this process. And so
• 17:49
  Speaker 1: we wonder if the prime minister believes that sanctions can
• 17:53
  Speaker 1: achieve what military action has not been able to.
• 17:58
  Speaker 10: We welcome the sanctions and we don't see them as
• 18:01
  Speaker 10: mutually exclusive with military actions. I'm sure the president has
• 18:05
  Speaker 10: already said that one thing is for sure. Iran cannot
• 18:08
  Speaker 10: have nuclear weapons. That's what the prime minister says. That's
• 18:11
  Speaker 10: what the president says. And that's what's going to happen.
• 18:15
  Speaker 10: So these sanctions are welcome. The Iranian economy is in
• 18:19
  Speaker 10: the gutter. Their inflation, they have hyperinflation. Their currency is...
• 18:25
  Speaker 10: as weak as they've ever been. It's like two million
• 18:29
  Speaker 10: real to one U.S.
• 18:30
  Speaker 9: Dollar.
• 18:31
  Speaker 10: They have no employment. Their economy is in the gutter,
• 18:36
  Speaker 10: and they're going to be hit even further. So those
• 18:39
  Speaker 10: are the conditions. The conditions are being created for this
• 18:43
  Speaker 10: terrible regime, these tyrants in Tehran to be clobbered.
• 18:49
  Speaker 1: Will they be hit militarily even further? There's a question
• 18:52
  Speaker 1: about whether the U.S. is, for instance, turning away from
• 18:55
  Speaker 1: military action to focus solely on an economic approach?
• 19:01
  Speaker 10: Well, again, I think those two things are not mutually exclusive.
• 19:05
  Speaker 10: And the main thing is that Iran cannot have nuclear weapons.
• 19:11
  Speaker 10: That has been made clear by the president. It's been
• 19:14
  Speaker 10: cleared by Israel as well. My prime minister made it
• 19:17
  Speaker 10: very clear that deal or no deal, Iran will not
• 19:21
  Speaker 10: have nuclear weapons as long as Prime Minister Netanyahu is
• 19:23
  Speaker 10: prime minister.
• 19:25
  Speaker 5: Can you give us any insight into what those conversations
• 19:28
  Speaker 5: look like right now between the U.S. and Israel in
• 19:30
  Speaker 5: terms of viable options for military escalation that could be
• 19:34
  Speaker 5: on the table?
• 19:35
  Speaker 10: Well, I can't get into details, but obviously everything's on
• 19:39
  Speaker 10: the table. And there's zero daylight between the president and
• 19:43
  Speaker 10: the prime minister. There's been great cooperation and coordination throughout
• 19:47
  Speaker 10: the war. I don't think there's ever been a precedence
• 19:49
  Speaker 10: of a great cooperation between a president and a prime
• 19:52
  Speaker 10: minister or between our armed forces, between the American armed
• 19:55
  Speaker 10: forces and between the Israeli armed forces. The achievements have
• 19:58
  Speaker 10: been incredible, unprecedented. Iran is weaker than it's ever been.
• 20:03
  Speaker 10: And America and Israel are stronger than we've ever been.
• 20:07
  Speaker 5: Well, part of building the pressure on Iran, given that
• 20:11
  Speaker 5: Iran's economy has taken a hit, though, is the most
• 20:13
  Speaker 5: powerful move would be to have China no longer importing
• 20:17
  Speaker 5: Iranian crude. That's a big question here when it comes
• 20:20
  Speaker 5: to the threatened actions by the U.S. Do you have
• 20:24
  Speaker 5: a sense on what the U.S. is particularly looking for
• 20:27
  Speaker 5: when it comes to China, if a reduction of barrels
• 20:29
  Speaker 5: would be enough, and if Israel is engaged in any
• 20:32
  Speaker 5: diplomacy when it comes— to perhaps pressuring China to cut
• 20:36
  Speaker 5: off some of its financial lifelines?
• 20:40
  Speaker 10: Well, I'm not going to get into American policy, of course.
• 20:42
  Speaker 10: American policy is led by the Americans. But I think
• 20:45
  Speaker 10: it would obviously be in the interest of China for
• 20:50
  Speaker 10: Iran to stop terrorizing the world. They're holding the Hormuz
• 20:54
  Speaker 10: Strait as blackmail towards the world. You could only imagine
• 20:58
  Speaker 10: what would happen if they had nuclear weapons. They would
• 21:01
  Speaker 10: blackmail the entire world, and there would be very little
• 21:03
  Speaker 10: we could do about it. So we acted in the
• 21:07
  Speaker 10: nick of time, and America and Israel did the right
• 21:10
  Speaker 10: thing to put this Iranian regime in its place.
• 21:14
  Speaker 1: I want to ask you this. Dr. Falk, about what's
• 21:18
  Speaker 1: happening or not happening in Gaza. You said in an
• 21:21
  Speaker 1: interview recently that when Hamas says it will disarm, quote,
• 21:24
  Speaker 1: the proof will be in the pudding, unquote. What does
• 21:28
  Speaker 1: proof look like to Israel? And has this boiled down
• 21:30
  Speaker 1: to who blinks first?
• 21:34
  Speaker 10: Well, it's very simple, actually. If Hamas wants to disarm,
• 21:39
  Speaker 10: they can disarm in an afternoon. They can just lay
• 21:42
  Speaker 10: down their arms. Now, the 20-point plan that President Trump
• 21:46
  Speaker 10: introduced almost a year ago, called for a 3D model
• 21:50
  Speaker 10: to disarm Hamas, to demilitarize Gaza, and to de-radicalize the Gazans.
• 21:56
  Speaker 10: That is a 3D model that we obviously signed on to.
• 22:00
  Speaker 10: If Hamas wants to disarm, they could do that in
• 22:02
  Speaker 10: an afternoon. That is the next step. And once they
• 22:05
  Speaker 10: do that, we can move forward.
• 22:09
  Speaker 5: Can you give us an update on where those efforts stand?
• 22:12
  Speaker 5: Where are we in that process toward potentially getting Hamas
• 22:15
  Speaker 5: to disarm?
• 22:18
  Speaker 10: Well, we currently, the IDF Israel currently controls between 60%
• 22:22
  Speaker 10: to 70% of Gaza. And we're demilitarizing that area right
• 22:27
  Speaker 10: now as we speak. The remaining area is being, unfortunately,
• 22:31
  Speaker 10: being controlled to a certain degree by Hamas. And we're
• 22:36
  Speaker 10: fully aligned with the BOP. And more importantly, we're fully
• 22:39
  Speaker 10: aligned with President Trump and Jared Kushner that, number one,
• 22:42
  Speaker 10: we have to disarm Hamas. Hamas needs to put down
• 22:45
  Speaker 10: its arms, and Gaza needs to be demilitarized, either the
• 22:49
  Speaker 10: easy way by just laying down your arms, which, again,
• 22:52
  Speaker 10: could be done in an afternoon, or it will be
• 22:54
  Speaker 10: done the hard way. But either way, Hamas is going
• 22:57
  Speaker 10: to be disarmed.
• 23:00
  Speaker 1: Just lastly, what's the hard way? What could be done
• 23:04
  Speaker 1: that hasn't been already? Gaza looks like the surface of
• 23:08
  Speaker 1: the moon, doctor.
• 23:10
  Speaker 10: Well, again, the hard way was what we've been doing
• 23:13
  Speaker 10: for over two years. We disarmed over 30,000 Hamas terrorists
• 23:19
  Speaker 10: by taking them out. And if that's what needs to
• 23:21
  Speaker 10: be done, that's what will be done. We prefer the
• 23:23
  Speaker 10: easy way for them just to lay down their arms
• 23:26
  Speaker 10: and that would be over with. That hasn't happened for
• 23:30
  Speaker 10: the past 10 months. They had the easy option of
• 23:33
  Speaker 10: just laying down their arms.
• 23:35
  Speaker 1: I hope they do what they said they'd do, what
• 23:39
  Speaker 1: they pledged.
• 23:39
  Speaker 10: To do, to lay down their arms, to disarm, to
• 23:41
  Speaker 10: demilitarize Gaza, and we can move forward. But if that
• 23:45
  Speaker 10: doesn't happen again, we're ready to do whatever needs to
• 23:48
  Speaker 10: be done.
• 23:50
  Speaker 1: He's the foreign policy advisor to Israeli Prime Minister Benjamin Netanyahu, Dr.
• 23:54
  Speaker 1: Ofer Falk. We appreciate your joining us and sharing your
• 23:57
  Speaker 1: insights with us today on Bloomberg. Let's play it to
• 23:59
  Speaker 1: our political panel, Bloomberg Politics contributors Rick Davis and Jeanne
• 24:03
  Speaker 1: Shanzano join us now. Rick is our Republican strategist, a
• 24:06
  Speaker 1: partner at Stonecourt Capital. Jeanne is our Democratic Analyst and
• 24:09
  Speaker 1: Democracy Visiting Fellow at Harvard Kennedy School's Ash Center. What
• 24:13
  Speaker 1: do you think about this, Rick? There are some concerns
• 24:15
  Speaker 1: that this period of time we're in, as the U.S.
• 24:18
  Speaker 1: waits for the economic stranglehold to intensify, that Iran is
• 24:23
  Speaker 1: simply rebuilding, digging out missile sites that we hit, trying
• 24:27
  Speaker 1: to make more missiles and drones for when this turns
• 24:31
  Speaker 1: back into a military action. What do you think?
• 24:36
  Speaker 2: Joe, I think you're absolutely correct.
• 24:38
  Speaker 9: There's absolutely evidence in the past that after every one
• 24:42
  Speaker 9: of our attacks, there's a rebuilding process that Iran has
• 24:47
  Speaker 9: used to the point where they've been very successful in
• 24:49
  Speaker 9: being able to reconstitute drone capabilities and missile manufacturing and.
• 24:55
  Speaker 2: Even launch systems that have been at one point destroyed.
• 24:59
  Speaker 9: So we can assume that in this period of time,
• 25:01
  Speaker 9: the risk that the administration's taken is is that we
• 25:04
  Speaker 9: can bring Iran to heel economically.
• 25:07
  Speaker 2: Even while they rebuild their arms capability.
• 25:10
  Speaker 9: And that is a threat to both the U.S., the
• 25:13
  Speaker 9: Persian Gulf, and to Israel, obviously, and our allies around
• 25:18
  Speaker 9: the region. It is a gamble, and I don't think
• 25:22
  Speaker 9: that anybody is taking it lightly in regard to what
• 25:27
  Speaker 9: kind of capability Iran will have if this period extends
• 25:31
  Speaker 9: and the economic sanctions over the course of the next
• 25:34
  Speaker 9: few months don't bite.
• 25:37
  Speaker 5: Jeannie, to pick up on the headline that crossed the
• 25:39
  Speaker 5: terminal earlier today, Iran and Oman, according to the IRGC,
• 25:43
  Speaker 5: are nearing a finalization of a pact to oversee traffic
• 25:48
  Speaker 5: in the Strait of Hormuz, which would include fees, is
• 25:50
  Speaker 5: that going to prompt the administration to have to take
• 25:52
  Speaker 5: an even harder stance when it comes to getting Iran
• 25:55
  Speaker 5: to the negotiating table? Because that seems to indicate that
• 25:58
  Speaker 5: we're moving in the other direction.
• 26:02
  Speaker 1: Yeah, absolutely, Tyler.
• 26:03
  Speaker 3: It's moving in the wrong direction. And what does the
• 26:06
  Speaker 3: administration do about it? We've tried a military campaign. We
• 26:09
  Speaker 3: tried a naval blockade. We tried an MOU. We are
• 26:13
  Speaker 3: now trying.
• 26:14
  Speaker 1: This D-Day, economic D-Day.
• 26:17
  Speaker 3: There's various reasons that none of those are going to work,
• 26:20
  Speaker 3: including the economic D-Day, because you would have to get China, Russia, Turkey,
• 26:25
  Speaker 3: Pakistan and all of Iran's trading neighbors and friends involved.
• 26:29
  Speaker 3: to disassociate. And that is, we've heard already, not in
• 26:32
  Speaker 3: the offing. So what do we do then? And that's
• 26:35
  Speaker 3: the problem. And I think it's fascinating in your conversation
• 26:39
  Speaker 3: that he was talking about the fact there's no daylight
• 26:41
  Speaker 3: between the United States or the president and the prime minister.
• 26:44
  Speaker 3: I think that's interesting because he also said that the
• 26:48
  Speaker 3: economic efforts are not mutually exclusive, keeping open the idea
• 26:53
  Speaker 3: of military campaign. And that is something that the president
• 26:57
  Speaker 3: clearly does not want to try to engage in again.
• 27:01
  Speaker 6: All right.
• 27:01
  Speaker 5: Our political panel today, Rick Davis, partner at Stonecourt Capital,
• 27:05
  Speaker 5: and Jeanne Shanzano, Democracy Visiting Fellow at Harvard Kennedy School.
• 27:09
  Speaker 5: Ash Center, both Bloomberg Politics contributors. Thank you both for
• 27:12
  Speaker 5: joining us.
• 27:13
  Speaker 1: Stay with us on Balance of Power. We'll have much
• 27:15
  Speaker 1: more coming up after this.
• 27:20
  Speaker 4: You're listening to the Bloomberg Balance of Power podcast. Catch
• 27:24
  Speaker 4: us live weekdays at noon and 5 p.m.
• 27:26
  Speaker 1: Eastern on Apple.
• 27:27
  Speaker 4: CarPlay and Android Auto with the Bloomberg Business app. Listen
• 27:31
  Speaker 4: on demand wherever you get your podcasts or watch us
• 27:34
  Speaker 4: live on YouTube.
• 27:37
  Speaker 1: We're picking up the pieces after another election day, though.
• 27:39
  Speaker 1: This was a little different. These were primary runoffs. None
• 27:43
  Speaker 1: more important, we're told, than South Carolina. But the Trump
• 27:47
  Speaker 1: endorsement on the line, Tyler, it worked out pretty well
• 27:50
  Speaker 1: for him in not only South Carolina, but also Oklahoma.
• 27:53
  Speaker 5: The president has a relatively strong track record when it
• 27:56
  Speaker 5: comes to these primary endorsements. I wanted to point out
• 27:59
  Speaker 5: some new stats came in from the Super PAC that
• 28:01
  Speaker 5: supports him. $ 830, 000 were spent in order to help boost
• 28:06
  Speaker 5: Darlene Graham, the sister of the late Senator Lindsey Graham.
• 28:09
  Speaker 1: I think it was a total of about $ 6 million
• 28:12
  Speaker 1: with outside groups added. But that was some of the
• 28:14
  Speaker 1: first MAGA Inc. money that had been spent at all
• 28:17
  Speaker 1: in the campaign. And, of course, he's the one who
• 28:19
  Speaker 1: asked her to run. So there was a bit on
• 28:20
  Speaker 1: the line here. And we're joined by someone who knows
• 28:24
  Speaker 1: a bit about the Carolinas. Patrick McHenry is with us,
• 28:27
  Speaker 1: Bloomberg Politics contributor, of course, former Republican congressman from North Carolina,
• 28:31
  Speaker 1: former House Financial Services Committee chairman, former Speaker Pro Tem. Mr. Chairman,
• 28:36
  Speaker 1: welcome back. Great to be back. Everyone in the media
• 28:39
  Speaker 1: likes to try to blow holes in this idea that
• 28:41
  Speaker 1: Trump endorsement had finally hit the wall. And we've done
• 28:44
  Speaker 1: this one race at a time and one state by state.
• 28:46
  Speaker 1: South Carolina, Oklahoma worked out well, and he put a
• 28:49
  Speaker 1: lot on the line for Darlene Graham. Why did he
• 28:52
  Speaker 1: expose himself like that? And did we learn anything about
• 28:55
  Speaker 1: the status of Darlene? The Trump brand?
• 28:58
  Speaker 11: Loyalty to Lindsey Graham was one of the reasons. The
• 29:01
  Speaker 11: president had deep affection for Lindsey Graham. That very complicated
• 29:05
  Speaker 11: relationship of how they started.
• 29:08
  Speaker 7: Number one. Number two, they wanted a loyalist elected to
• 29:12
  Speaker 7: the Senate.
• 29:13
  Speaker 11: Number three, South Carolina is a bulwark of Trump's support.
• 29:17
  Speaker 11: The combination of Lindsey Graham's popularity in the state and
• 29:20
  Speaker 11: Donald Trump's popularity in the state elected Darlene Graham, who
• 29:26
  Speaker 11: was Lindsey Graham's sister, unrelated to politics.
• 29:31
  Speaker 7: A year ago, no one knew her. Four months ago,
• 29:34
  Speaker 7: no one had heard of her.
• 29:36
  Speaker 11: Ralph Norman, who made the runoff against her, has been
• 29:39
  Speaker 11: a long policy elected official, Freedom Caucus leader in the U.S.
• 29:44
  Speaker 7: House, very outspoken, critic of, well, a lot of things.
• 29:50
  Speaker 11: But he was much more loyal to the Freedom Caucus
• 29:53
  Speaker 11: than he was to President Trump.
• 29:55
  Speaker 5: Yeah.
• 29:55
  Speaker 11: And President Trump wanted to show that he still has
• 29:58
  Speaker 11: power and capacity within the Republican Party.
• 30:00
  Speaker 7: He clearly, clearly does.
• 30:02
  Speaker 5: Well, and the president actually posted about the Congressman Ralph
• 30:06
  Speaker 5: Norman this morning talking about his endorsement of Nikki Haley.
• 30:09
  Speaker 5: So it appeared that this might have been a few
• 30:11
  Speaker 5: years in the making in terms of. who the president
• 30:15
  Speaker 5: may have backed in this race.
• 30:16
  Speaker 11: Ralph was a rare opponent of President Trump in South
• 30:22
  Speaker 11: Carolina among elected officials. And while Ralph Norman may have
• 30:26
  Speaker 11: forgotten about his endorsement of Nikki Haley.
• 30:29
  Speaker 7: President Trump did not.
• 30:31
  Speaker 11: And so these, you know, what we're finding out is
• 30:34
  Speaker 11: much like NASCAR, I'm a big NASCAR fan growing up
• 30:37
  Speaker 11: in North Carolina. And what you'll find out about these
• 30:41
  Speaker 11: race drivers is that they will talk about a feud
• 30:44
  Speaker 11: that is a decade old, right?
• 30:46
  Speaker 5: Yeah.
• 30:46
  Speaker 11: Professional wrestling, stock car drivers, and President Trump, they will
• 30:50
  Speaker 11: remember this light from years and years ago.
• 30:53
  Speaker 1: No doubt. Does that mean you were at IndyCar, or
• 30:55
  Speaker 1: did you boycott IndyCar because you're a NASCAR guy?
• 30:57
  Speaker 7: It was a great event.
• 30:58
  Speaker 1: Yeah, it was pretty wild.
• 30:59
  Speaker 7: But no, the Indy product is not as good as
• 31:01
  Speaker 7: the NASCAR product.
• 31:02
  Speaker 1: It's not as good.
• 31:02
  Speaker 7: Not in my view.
• 31:04
  Speaker 1: Fantastic.
• 31:04
  Speaker 11: But top ratings for Indy here in D.C., the best
• 31:08
  Speaker 11: viewership of Indy, one of the best racing cars. viewerships
• 31:13
  Speaker 11: of any race in the United States. A really amazing
• 31:17
  Speaker 11: product that happened. I was indoctrinated on Sunday.
• 31:20
  Speaker 1: I'm a baby. I don't know anything about them. I'm
• 31:22
  Speaker 1: from Connecticut. What the heck do I know? But I
• 31:24
  Speaker 1: was fascinated and blown away by the whole thing. and
• 31:27
  Speaker 1: being on Pennsylvania Avenue in this environment, I'm wondering about
• 31:31
  Speaker 1: the politics behind this. That was the final peg in
• 31:34
  Speaker 1: a series of events. It started with the UFC fight.
• 31:37
  Speaker 1: You weren't there for that, were you? No, I was not.
• 31:39
  Speaker 1: I bet you were invited. We had the big air shows,
• 31:42
  Speaker 1: all the flybys, the Guinness Book fireworks, now IndyCar. Is
• 31:49
  Speaker 1: there an impact on the voter, the way they look
• 31:52
  Speaker 1: at Donald Trump, the sort of bare-chested America 250? What
• 31:55
  Speaker 1: does that do politically?
• 31:56
  Speaker 7: It doubles down on his brand and who he is.
• 31:59
  Speaker 11: He believes in America, the strength of America, the capacity
• 32:01
  Speaker 11: of America. And what better way to express it than
• 32:04
  Speaker 11: the 250th anniversary? Those that are opposing him or opposing
• 32:09
  Speaker 11: these events look like they're anti-American. So what a great
• 32:12
  Speaker 11: setup when he's trying to show off America, show off
• 32:17
  Speaker 11: our capital city, and make improvements to our capital city.
• 32:20
  Speaker 11: And for people to fight him about cleaning up fountains
• 32:23
  Speaker 11: or putting up statues or having events like this, they
• 32:26
  Speaker 11: look silly because what he's trying to do is really
• 32:29
  Speaker 11: show off, just like Rome at its height, show off
• 32:32
  Speaker 11: through games who we are in this capacity.
• 32:35
  Speaker 7: It's a very pro-America or America first thing.
• 32:38
  Speaker 1: Well, you know, Rome at its height, though, was the
• 32:40
  Speaker 1: prelude to.
• 32:41
  Speaker 7: Well, you know, I said it for a reason.
• 32:43
  Speaker 1: Oh, God.
• 32:44
  Speaker 7: It does have a double-edged sword to it.
• 32:46
  Speaker 1: It's a complicated message.
• 32:47
  Speaker 5: Wow.
• 32:47
  Speaker 1: With reference to Nero. Take it away, Tyler.
• 32:50
  Speaker 5: I'm going to try to tie all these together, but
• 32:51
  Speaker 5: also move our conversation forward.
• 32:54
  Speaker 1: Sorry for everything.
• 32:55
  Speaker 5: Well, if we go to the Oklahoma race yesterday. Part
• 32:59
  Speaker 5: of what we're all talking about right now is building
• 33:02
  Speaker 5: up America, American ingenuity, America 250. Part of the race
• 33:06
  Speaker 5: that we saw yesterday in Oklahoma, President Trump in part
• 33:09
  Speaker 5: didn't back the candidate that lost over reported opposition to
• 33:14
  Speaker 5: an aluminum smelter plant.
• 33:15
  Speaker 1: That's right.
• 33:16
  Speaker 5: This week, President Trump ramped up the tariff tit-for-tat escalation
• 33:21
  Speaker 5: with Canada. We get a huge amount of aluminum from Canada,
• 33:24
  Speaker 5: I think to the tune of like 50% of what's
• 33:27
  Speaker 5: consumed in this country today. How is this going to
• 33:30
  Speaker 5: play if we bring this back to domestic politics in
• 33:32
  Speaker 5: the midterm elections as we ramp up the trade war?
• 33:35
  Speaker 5: But it also goes to the president's point that you
• 33:38
  Speaker 5: need to bolster domestic manufacturing to have the U.S. be
• 33:41
  Speaker 5: less reliant on other countries for critical materials like this.
• 33:45
  Speaker 11: Well, the complicated thing is returning supply chains here to
• 33:48
  Speaker 11: the United States does have an inflationary impact, right? You
• 33:52
  Speaker 11: have a temporary lag in the ability to build up
• 33:55
  Speaker 11: domestic manufacturing when you're cutting off a foreign supplier. That
• 34:00
  Speaker 11: complicates inflation picture for the Fed, makes things complicated going
• 34:04
  Speaker 11: into a midterm election. Stepping back, one aperture from the
• 34:08
  Speaker 11: direct trade war with Canada, which is an avoidable disaster
• 34:12
  Speaker 11: in my opinion, taking back one aperture of this, you
• 34:17
  Speaker 11: have the AI build out, the AI revolution, This reshoring
• 34:23
  Speaker 11: back to the United States and the president's deregulatory agenda
• 34:26
  Speaker 11: and tax agenda, there are huge lifts for the American economy.
• 34:29
  Speaker 11: And at the same time, we have a trade war
• 34:31
  Speaker 11: that is a huge headwind to us and to the
• 34:35
  Speaker 11: American people. You have American people experiencing inflation, and we
• 34:39
  Speaker 11: don't like it. Then you have the Iran war and
• 34:42
  Speaker 11: the effect on energy prices in the United States and globally.
• 34:46
  Speaker 11: Imagine what this economy would be doing but for tariffs
• 34:51
  Speaker 11: and Iran. It would be an all-time tear. And instead,
• 34:55
  Speaker 11: we have to have the Treasury intervene with long-term rates
• 35:00
  Speaker 11: in order to manipulate the economy for short-term gains. So this,
• 35:06
  Speaker 11: the economic question here, the voters will speak on this
• 35:11
  Speaker 11: in November. This midterm Republican convention in Dallas in a
• 35:16
  Speaker 11: couple of weeks, will be a question of trying to
• 35:19
  Speaker 11: reset what the American people are experiencing, but it is
• 35:22
  Speaker 11: certainly a very complicated and challenging picture to try to paint.
• 35:28
  Speaker 11: It's a very complicated thing for politicians to paint a
• 35:31
  Speaker 11: positive picture about the economy right now.
• 35:33
  Speaker 1: Just as the market... wakes up to the federal debt
• 35:37
  Speaker 1: for some reason. This has been wild. You talked about
• 35:40
  Speaker 1: the intervention at the Treasury, but $ 40 trillion set off
• 35:43
  Speaker 1: alarm bells for some reason in a way that $ 39. 9
• 35:47
  Speaker 1: trillion did not. And I talked yesterday about all of
• 35:50
  Speaker 1: this with your old friend, Kevin Brady, the former congressman
• 35:53
  Speaker 1: from Texas, the chair of House Ways and Means. Here's
• 35:55
  Speaker 1: what he had to say.
• 35:57
  Speaker 12: I think getting fiscal policy right is the only solution here.
• 36:02
  Speaker 12: It's not going to come from the Fed. It will
• 36:04
  Speaker 12: not come from the Treasury or any administration, frankly. It's
• 36:07
  Speaker 12: going to have to come from Congress. Setting guardrails around spending,
• 36:12
  Speaker 12: sending enforceable, putting in place enforceable spending caps. And over time,
• 36:18
  Speaker 12: you're not going to fix this problem immediately, but over time,
• 36:21
  Speaker 12: right-sizing that government in a way that markets, more importantly,
• 36:24
  Speaker 12: the country feels more secure.
• 36:27
  Speaker 1: Kevin Brady is an old-style Republican, and what he's saying
• 36:31
  Speaker 1: makes a lot of sense. But, I mean, this comes
• 36:33
  Speaker 1: with a big eye roll. You're going to tell us
• 36:34
  Speaker 1: next about a blue-ribbon panel? How do we manage this
• 36:37
  Speaker 1: on the Hill?
• 36:38
  Speaker 8: Oh, no.
• 36:39
  Speaker 11: You have to actually do something about the national debt.
• 36:43
  Speaker 11: You have to do something about our annual deficit.
• 36:46
  Speaker 1: Yes.
• 36:46
  Speaker 11: Congress has done nothing about this since before the financial crisis,
• 36:51
  Speaker 11: since Bush's second term, where we had a deficit that
• 36:57
  Speaker 11: was actually one-tenth the size it is currently. This is
• 37:01
  Speaker 11: the annual deficit. And so there are a couple things
• 37:07
  Speaker 11: that have hit the market. One is it's clear the
• 37:10
  Speaker 11: politicians don't care about this.
• 37:12
  Speaker 5: Yes.
• 37:13
  Speaker 7: A Democratic Party that wants to spend more.
• 37:17
  Speaker 11: And isn't really talking about serious tax increases to fund it, one. Two,
• 37:23
  Speaker 11: we have Republicans that are not a fiscal conservative. They're
• 37:26
  Speaker 11: no longer a fiscally conservative party if they ever were.
• 37:29
  Speaker 11: They're more of a populist party. And no populist party
• 37:31
  Speaker 11: in the world– It cares about debt and deficits.
• 37:35
  Speaker 1: They don't.
• 37:36
  Speaker 7: They want to enjoy the high times right now. So
• 37:40
  Speaker 7: you have that.
• 37:41
  Speaker 11: You also have the Fed signaling clearly we're no longer
• 37:45
  Speaker 11: going to monetize the debt. which they have done since
• 37:49
  Speaker 11: the financial crisis, which has enabled Congress to look the
• 37:51
  Speaker 11: other way. And third, you have this AI revolution that
• 37:57
  Speaker 11: has required gobs of money, tens of billions of dollars
• 38:01
  Speaker 11: for this build-out.
• 38:02
  Speaker 7: So how do you prioritize yourself?
• 38:05
  Speaker 11: To fund something that is a broken system or fund
• 38:08
  Speaker 11: the next thing that can work?
• 38:10
  Speaker 7: Unleash the next generation.
• 38:11
  Speaker 1: You just connected all the dots today.
• 38:12
  Speaker 7: But then what's the tipping point?
• 38:14
  Speaker 5: When voters tell lawmakers they have to start paying attention? Yes.
• 38:18
  Speaker 11: The last time I had a town hall meeting about
• 38:21
  Speaker 11: the debt and deficit was in 2010. And they rolled
• 38:25
  Speaker 11: their eyes and they said, let's talk about something else.
• 38:27
  Speaker 11: I had great charts, too. And my staff said, I'm
• 38:30
  Speaker 11: bringing the charts. Right?
• 38:31
  Speaker 7: Wow. And so the voters have not prioritized this, but
• 38:36
  Speaker 7: it is heart disease.
• 38:37
  Speaker 5: Mm-hmm.
• 38:38
  Speaker 11: This is not a problem until there's a cataclysmic event.
• 38:41
  Speaker 1: It's amazing we haven't had a heart attack. We're getting
• 38:45
  Speaker 1: the warning signs. So you go to Dallas and you
• 38:48
  Speaker 1: have to deliver a message at the Dallas convention at
• 38:52
  Speaker 1: the same time America's watching football. Did you see this?
• 38:56
  Speaker 1: The 9th and the 10th.
• 38:58
  Speaker 2: J.D.
• 38:58
  Speaker 1: Vance is speaking the same time Patriots-Seahawks Super Bowl rematch.
• 39:03
  Speaker 1: Trump is up against the 49ers-Rams the night after. The
• 39:07
  Speaker 1: tree that falls in the woods.
• 39:09
  Speaker 11: So this is exactly what you're talking about with what
• 39:12
  Speaker 11: is Trump trying to say with this 250th anniversary of America?
• 39:15
  Speaker 5: Yeah.
• 39:16
  Speaker 10: Right?
• 39:16
  Speaker 7: Strong, hurrah, America.
• 39:17
  Speaker 1: Yeah.
• 39:18
  Speaker 7: Who are those people? They're going to be watching the NFL.
• 39:21
  Speaker 1: The football game.
• 39:21
  Speaker 11: Right?
• 39:21
  Speaker 1: He should be doing an interview at halftime.
• 39:23
  Speaker 7: It would be far better.
• 39:25
  Speaker 2: Far better.
• 39:25
  Speaker 11: So this is going to be hard programming, and it's
• 39:29
  Speaker 11: going to be very difficult to break through on a
• 39:31
  Speaker 11: night like that when live sports are still the dominant
• 39:36
  Speaker 11: player on evening programming.
• 39:39
  Speaker 5: Should we expect anything monumental that he could say that
• 39:42
  Speaker 5: would make people want to change the channel and tune in?
• 39:46
  Speaker 7: Never count him down.
• 39:47
  Speaker 1: Or at least look back at Twitter the next morning, right?
• 39:50
  Speaker 7: You have no idea what he can bring.
• 39:53
  Speaker 11: And I think his staff is cooking things up, but
• 39:57
  Speaker 11: he's certainly cooking things up separate from his staff.
• 39:59
  Speaker 1: Are you going?
• 40:01
  Speaker 7: Not if I don't have to.
• 40:03
  Speaker 1: That's what every reporter in Washington said as well, I think.
• 40:06
  Speaker 11: Unfortunately, it could be something interesting and likely will be.
• 40:12
  Speaker 1: You wonder if it's a new thing. Maybe both parties
• 40:14
  Speaker 1: do midterm every time we have it.
• 40:15
  Speaker 11: Republicans need it to juice the Trump electorate to come
• 40:19
  Speaker 11: out and potentially save at least the Senate, if not
• 40:23
  Speaker 11: narrow the House minority.
• 40:24
  Speaker 1: I bet we'll be talking to this man that week.
• 40:27
  Speaker 1: Patrick McHenry, Bloomberg Politics contributor. Thank you, Mr. Chairman, as always.
• 40:32
  Speaker 1: Thanks for listening to the Balance of Power podcast. Make
• 40:36
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• 40:39
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• 40:41
  Speaker 1: us live every weekday from Washington, D.C. at noontime Eastern
• 40:45
  Speaker 1: at Bloomberg.com.