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Trump Holds Off Iran Attacks, Blanche Strikes Deal With GOP Senators · Balance of Power

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Speaker 2: Oil is dropping below eighty dollars a barrel once again
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Speaker 2: today on hope of potentially diplomatic progress between the US
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Speaker 2: and Iran, or if not that at least there was
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Speaker 2: no escalation over the weekend and further attacks that the
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Speaker 2: US might have conducted on Iranian infrastructure if not, according
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Speaker 2: to President Trump, for the request of other Gulf states
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Speaker 2: to hold off on that. As he described to reporters
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Speaker 2: of Bord Air Force one yesterday, it was going.
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Speaker 3: To be attacked. That would have been by far the
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Speaker 3: biggest attacks ace World War Two.
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Speaker 4: When the Allies asked to follow it off, you got
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Speaker 4: to sort of saying, well, let's see, and there is
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Speaker 4: They asked us, I think there's a deal.
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Speaker 3: Going talking to them in the form of a negotiation.
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Speaker 5: It begins tomorrow afternoon, and we'll see if that jo
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Speaker 5: I'd love to do that.
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Speaker 6: Fast forward to this afternoon, and there are no negotiations.
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Speaker 6: CBS News reporting as much in the president's own posting
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Speaker 6: on truth Social would lead you to believe that as well.
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Speaker 6: He doesn't say it outright, but the President just a
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Speaker 6: short time ago, writing Iranian leadership is unbelievably duplicitous exclamation point.
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Speaker 6: They ask for a meeting, he says, Some would say
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Speaker 6: beg talks begin with more scheduled in the immediate future,
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Speaker 6: and they say openly and proudly that they're not having
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Speaker 6: any discussions and that nothing is being talked about and
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Speaker 6: they're only dealing with Oman. He goes on to say
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Speaker 6: that Iran will never have a nuclear weapon. But it's
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Speaker 6: difficult to tell exactly where we are between what we
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Speaker 6: heard from the president over the weekend backing down from
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Speaker 6: the strikes, and what we heard from him ahead of
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Speaker 6: the weekend, locked and loaded and what was going to
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Speaker 6: be the most punishing military attack, as he said, since
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Speaker 6: World War Two. Let's get into this with Jordan Fabian,
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Speaker 6: our White House News editor here in Washington. Jordan, should
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Speaker 6: we believe that this post is an indication that talks
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Speaker 6: are off the table?
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Speaker 7: I wouldn't necessarily say that, Joe I think the president
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Speaker 7: has a huge credibility problem right now. He's gone through
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Speaker 7: the cycle over and over again over the past few weeks,
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Speaker 7: ever since the memorandum of understanding with Iran collapsed, and
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Speaker 7: now he's effectively trapped in this cul de sac where
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Speaker 7: he's driving around in circles, unable to find a solution
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Speaker 7: or a way out. A negotiated agreement with a round
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Speaker 7: doesn't appear to work, as he said, you know, they
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Speaker 7: have also been unreliable negotiators in his view. But also
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Speaker 7: climbing the escalation ladder is an unlikely prospect as well.
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Speaker 7: It would anger regional allies and it would further deplete
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Speaker 7: US weapon stock.
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Speaker 3: So he is.
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Speaker 2: Well, and he noted that there were other Golf states
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Speaker 2: who were concerned about the kind of escalation that was
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Speaker 2: being reported about Jordan. It was also escalation that was
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Speaker 2: set to include Israel according to some of the reporting
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Speaker 2: we saw, where is Israel in all of this.
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Speaker 7: Whereas they were taking a front row seat with the
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Speaker 7: US early in the conflict, they seem to have taken
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Speaker 7: a step back and are waiting for you ques from
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Speaker 7: the US. Because Trump has kind of been all over
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Speaker 7: the place here, you know, including a few weeks ago
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Speaker 7: when he was angry at Prime Minister Benjamin and Netan
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Speaker 7: Yahoo for carrying out military operations in Lebanon that he
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Speaker 7: said was imperiling his negotiation negotiations with Iran. They've really
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Speaker 7: taken a step back, and so right now President Trump
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Speaker 7: is kind of the primary actor here, but he hasn't
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Speaker 7: settled on the course of action, and so that makes
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Speaker 7: it very difficult for all the other countries involved to
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Speaker 7: see where he's going to land.
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Speaker 6: Yeah, it's really amazing to consider President getting a call
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Speaker 6: from MBS to ask him to continue talking for fear
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Speaker 6: of what this might turn into.
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Speaker 3: How urgent is the concern.
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Speaker 6: Jordan in the region of this blowing up into a
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Speaker 6: full blown Middle Eastern war.
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Speaker 3: It's quite high, Joe.
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Speaker 7: It's underscored by the NBS discussion for him, their alternate
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Speaker 7: route for oil shipments out of the region, the Red Sea,
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Speaker 7: was imperiled by potentially the hooth he's getting involved. There
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Speaker 7: was some sign of that happening a couple weeks ago.
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Speaker 7: They're obviously cut off through the Persian Gulf, so they
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Speaker 7: don't want the other route to be cut off either,
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Speaker 7: and not to mention the fact that a massive escalation
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Speaker 7: by the US would trigger retaliation by Iran. And despite
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Speaker 7: the President's comments that they've degraded the Irani military, they've
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Speaker 7: still been able to hit targets throughout the region, including
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Speaker 7: locations with US troops. And so they know that a
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Speaker 7: massive attack on Iran's power plants could trigger alleation that
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Speaker 7: could damage cities in Saudi Arabia, cities in the UAE,
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Speaker 7: and cutter And that's why you see these governments urging
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Speaker 7: the President to stay at the table.
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Speaker 2: YEP asked him to climb down, and climb down. It
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Speaker 2: seems he did, at least for now. We also saw
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Speaker 2: something of a climb down from the dj Jordan, Todd
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Speaker 2: Blanche putting it in writing at the request of Senators
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Speaker 2: Tillis and Cornan, who of course, we're holding up his
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Speaker 2: confirmation process that the anti weaponization fund created back in
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Speaker 2: May is indeed dead, that that order is rescinded, clarifying
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Speaker 2: the details of this IRS audit immunity for the president
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Speaker 2: as well. We know it got the thumbs up from
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Speaker 2: Cornin and Tillis. They're ready to vote yes for him
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Speaker 2: in the Judiciary Committee tomorrow. Do we know how this
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Speaker 2: is sitting with the President.
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Speaker 7: It's unclear right now, Kaylee. And we've been asking the
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Speaker 7: White House all day if the President signed off on
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Speaker 7: this thing, and having heard back, we're going to hear
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Speaker 7: from the President, we think in at least a half
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Speaker 7: an hour here, so.
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Speaker 3: Maybe we'll get some more answers.
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Speaker 7: But you know, it's unclear he has the pension to
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Speaker 7: sort of way in the last minute and derail deals.
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Speaker 7: He was upset with Janine Pierro, the US Attorney for
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Speaker 7: the District of Columbia, over the weekend for throwing out
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Speaker 7: the prosecution over the reflecting pool, contradicting his narrative that
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Speaker 7: it was vandals that damaged it, and so, you know,
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Speaker 7: possibly something he could say the same about this Blanche deal.
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Speaker 7: It's possibly he says he'll live with it because he
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Speaker 7: wants to see Todd Blanche become the permanent Attorney General.
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Speaker 7: So we'll have to wait and see what the President
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Speaker 7: says here.
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Speaker 2: Indeed we will, and of course, if the President takes
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Speaker 2: questions from reporters during that executive order signing, we'll bring
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Speaker 2: that to our audience live here on Bloomberg TV and Radio.
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Speaker 2: Jordan Fabian covering the White House for us. Thank you
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Speaker 2: so much, and we want to focus back on what
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Speaker 2: we were just discussing with Jordan, the conflict with Iran
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Speaker 2: and talks or the lack thereof toward a potential resolution
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Speaker 2: as we bring in now. Michael Allen a beacon Global Strategies.
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Speaker 2: He's also former Special assistant to President George W. Bush
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Speaker 2: in the national security sector. Welcome back to Balance of Power.
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Speaker 2: It's good to have you. As Joe has said repeatedly,
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Speaker 2: the President says Ron is unbelievably duplicitous and is saying
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Speaker 2: one thing privately and asking for talk, saying obviously another
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Speaker 2: thing publicly. Today.
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Speaker 4: What are we to believe?
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Speaker 8: Well, I don't know that we're directly talking to the Iranians.
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Speaker 8: I have a feeling we're talking, of course, to all
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Speaker 8: these different intermediaries. Oman is the one we're talking about today,
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Speaker 8: but usually there's also Cutter and Pakistan that are.
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Speaker 9: In the mix.
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Speaker 8: I think probably when these intermediaries come to us, they
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Speaker 8: lean a little bit far forward to try and get
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Speaker 8: us to either not attack or to embrace or indicate
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Speaker 8: openness to talking, and then they hope they can match
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Speaker 8: that back with the other side. But in this case,
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Speaker 8: I think things are not in a good place for
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Speaker 8: us to be able to get together. And I think
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Speaker 8: the president always wants to maintain maximum flexibility, so he's
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Speaker 8: bobbing and weaving.
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Speaker 6: How many times does he get the bob and weave?
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Speaker 6: You know, there were some groans last week. Okay, well enough,
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Speaker 6: we're doing this again. The top of drudge right now
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Speaker 6: is the President holding up a taco markets, by the way,
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Speaker 6: seem to be answering unlimited. Every time this happens, the
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Speaker 6: market goes up, then we're going to get upset and
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Speaker 6: threaten to bomb.
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Speaker 3: The markets will go down.
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Speaker 6: But you know, guys, oil prices are still down four
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Speaker 6: five percent today. Does he get an unlimited card when
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Speaker 6: it comes to this play.
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Speaker 9: It seems like it.
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Speaker 8: I mean, it seems like he is only interested in
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Speaker 8: messaging the oil markets or the markets writ large. He's
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Speaker 8: got a strategic communications problem. I think with the Iranians,
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Speaker 8: I think it confuses them when we say they're dying
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Speaker 8: to get together and bend. I think it's a big
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Speaker 8: problem for us that we're sort of signaling that we're
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Speaker 8: irresolute to others in the region when we say anything
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Speaker 8: other than we've got we've got all we ought to
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Speaker 8: be saying, we've got all day. We're going to keep
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Speaker 8: this blockade going, we're going to enforce the sanctions, we're
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Speaker 8: going to try to get some ships through the straits
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Speaker 8: of Hoar Moves. But we can't stick to one coherent
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Speaker 8: message for more than a day or two. So I
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Speaker 8: think we've confused everyone in the region, the American people,
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Speaker 8: and most interestingly here our adversaries who aren't sure what
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Speaker 8: to make of us.
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Speaker 2: Resolve, Well, you just said we've got all day. Do
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Speaker 2: we really mean this posture? Indefinitely?
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Speaker 8: It's gonna hurt readiness and it would be expensive. But
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Speaker 8: I would have said that two months ago, because if
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Speaker 8: they believe that we're going to give up on the
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Speaker 8: blockade again in three or four days, what do they care?
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Speaker 8: And so I think that we have just signaled that
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Speaker 8: we're flexible. And by the way, that's what the president
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Speaker 8: all everything you read about the President, what he doesn't
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Speaker 8: like his aid's doing, is locking him into positions.
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Speaker 9: He's not like a.
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Speaker 8: Typical politician that's worried about someone saying, well, you had
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Speaker 8: a different opinion three days ago, what happened. He's like,
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Speaker 8: I switched to my position so he always wants to
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Speaker 8: maintain maximum flexibility. If someone's coming to him and saying
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Speaker 8: I think there's a diplomatic opening, he says, Okay, well
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Speaker 8: let's go see what that is. And if it doesn't
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Speaker 8: bear fruit, I think he's in kates that he's ready
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Speaker 8: to go back to war. It's confusing. We're whiplashing. Of course,
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Speaker 8: it gives us not a lot of confidence that we
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Speaker 8: know how we're gonna get out of this. But he's
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Speaker 8: going to try every door and hope to find one
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Speaker 8: that opens.
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Speaker 6: Michael Iran's Foreign Ministry spokesman, Smiled Bagay says, not only
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Speaker 6: are they close to finalizing a deal with Oman to
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Speaker 6: reopen the strait, but the quote was under no circumstance
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Speaker 6: will the straight up Homu has returned to the situation
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Speaker 6: before the war. This is not the world as the
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Speaker 6: president sees it.
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Speaker 9: It's not.
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Speaker 8: I wonder at the end of the day, though, I
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Speaker 8: mean I kind of forecast in the medium term, we're
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Speaker 8: already sort of grinding through this in an imperfect way.
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Speaker 8: I wonder if the way out of this is going
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Speaker 8: to be some modus vivendi where we look the other
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Speaker 8: way on certain payments. If you're going to use the
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Speaker 8: Iranian side of the straits, We'll continue to say it's open.
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Speaker 8: We'll do our best to attract people to the route.
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Speaker 8: But I don't just you know, I don't necessarily see
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Speaker 8: how you totally negate the Iranian role here if we're
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Speaker 8: unwilling to forcibly reopen the straits. And that's apparently what
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Speaker 8: Mohammed bin Salman and others are saying to the President.
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Speaker 8: If you hit their energy infrastructure or if you go
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Speaker 8: too hard at them, we're the ones that are going
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Speaker 8: to absorb the retaliation, but you'll feel the repercussions of
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Speaker 8: the oil prices. And so I think every time Trump's
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Speaker 8: reminded of that, he pulls back a little bit. So
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Speaker 8: I bet there's some imperfect, sloppy understanding at the end
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Speaker 8: of the day. Maybe we don't see some sort of
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Speaker 8: formal written agreement, but some sort of arrangement.
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Speaker 2: Speaking of arrangements, the President announced last week an arrangement
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Speaker 2: or an agreement made between Israel and Hamas that Hamas
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Speaker 2: was going to disarm and that Israel would eventually withdraw
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Speaker 2: up militarily from Gaza. It seems neither side, though, wants
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Speaker 2: to do what they said they would before the other
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Speaker 2: one moves first. What is the likelihood that is going
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Speaker 2: to be able to be executed in the way the
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Speaker 2: President described.
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Speaker 8: Well, it's very low, and in this case, I think
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Speaker 8: the President and his team deserve credit for trying.
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Speaker 9: I mean, it looks good on paper.
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Speaker 8: When you read through the agreement, you think to yourself, Wow,
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Speaker 8: if this could work, this could be a breakthrough. But
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Speaker 8: I think you can't help given the history of this,
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Speaker 8: but apply a healthy day of skepticism. It doesn't seem
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Speaker 8: like Hamas is going to really give up their weapons.
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Speaker 8: It doesn't seem like these Raelis are going to gradually
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Speaker 8: continue to pull back and lose their leverage over what's.
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Speaker 9: Going on in Gaza.
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Speaker 8: I don't want to totally rain on the parade. I
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Speaker 8: hope it works. It reads good, it looks like we
12:41
Speaker 8: could try to do it, But I don't know. It's
12:44
Speaker 8: you're foolhardy to be too optimistic when it comes to
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Speaker 8: Israel Palestine.
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Speaker 6: Well, I mean your opinions are being informed by history here,
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Speaker 6: remembering the President also said this war with Iran would
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Speaker 6: be over in what four to six weeks? Are you
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Speaker 6: at the point now to believe answer this as you will,
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Speaker 6: but that all of this is unresolved on November third, I.
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Speaker 8: Think it's very possible. I think we could be muddling through,
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Speaker 8: continuing in these cycles where if the price of oil
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Speaker 8: gets too high up the president indicates he's ready to talk,
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Speaker 8: prices go back down, the Iranians take.
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Speaker 3: A shot with last year.
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Speaker 8: Yeah, well then they're worried that too many I mean,
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Speaker 8: when this all broke out again ten days ago or
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Speaker 8: whatever it was, it was because too many ships in
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Speaker 8: the Iranian estimation, we're going through the Oman side of
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Speaker 8: the Straits, and so they said, wait a second, are
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Speaker 8: we losing leverage here? And then they took shots and
13:31
Speaker 8: then we went after them again. So I think you're
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Speaker 8: going to continue to see the tit for TAD totally
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Speaker 8: not very clear situation of what we're doing, muddling through
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Speaker 8: just I can't foresee it's coming back almost even to
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Speaker 8: an MoU, which was a mess in and of itself,
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Speaker 8: And so I think they're going to be unstated understandings
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Speaker 8: held with intermediaries in the medium term. But you know,
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Speaker 8: don't look for some signing ceremony somewhere where we're going
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Speaker 8: to get through this and have some kind of ironclad,
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Speaker 8: clear document.
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Speaker 2: Well, we're wondering if there's going to be a signing
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Speaker 2: ceremony that President Trump would partake in signing off on
14:07
Speaker 2: a new sanctions bill that seems like the Senate could
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Speaker 2: vote on this week before the recess that would allow
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Speaker 2: for the President to enact tariffs on buyers of Russian
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Speaker 2: energy products.
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Speaker 4: But also aroan.
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Speaker 2: Now, and I wonder if you think for either of
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Speaker 2: these conflicts that that is going to be able to
14:21
Speaker 2: move the needle, assuming it can clear both chambers.
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Speaker 8: So I think it does help if the President wants
14:26
Speaker 8: to actually use them against Russia. If he wants to
14:30
Speaker 8: use them, he may think, well, you know, I'm in
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Speaker 8: a negotiation with them, I'm trying to induce them to
14:34
Speaker 8: come to the table, and so I don't want to
14:36
Speaker 8: use them, but maybe just the dangling them out there
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Speaker 8: has some effect. So I'm glad they're seemingly on track
14:45
Speaker 8: to be able to pass.
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Speaker 9: It's interesting that he wanted to run at it in there.
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Speaker 8: I think it helps if he thinks that's a great
14:51
Speaker 8: tool for him to use sanctions. Wise, it'd be wiser
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Speaker 8: if we continue the blockade, because that's the real sanctions enforcement,
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Speaker 8: not just chasing banks all over the world and blacklisting people.
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Speaker 9: That's saying you're not coming through the strait.
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Speaker 8: So let's hope he uses this legislation for what it
15:09
Speaker 8: was intended, to increase his leverage over these adversaries.
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Speaker 6: Interesting, we only have thirty seconds left. Remember you sat
15:15
Speaker 6: here for Operation Midnight Hammer. We talked about the walk
15:20
Speaker 6: up to that, and then, of course what happened is
15:22
Speaker 6: Pickaxe Mountain next.
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Speaker 3: Is that the next time we meet?
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Speaker 8: I think so, but I'm worried about whether we can.
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Speaker 8: I don't know that they're ventilation chefts on Pickax's Mountain
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Speaker 8: that we can just send a moab through. I think
15:34
Speaker 8: it's a differen It's hard to say without being briefed
15:36
Speaker 8: on the intelligence, but didn't feel like ford Ow and Naton's.
15:41
Speaker 6: Great to see you, Michael Allen with US Beacon Global
15:44
Speaker 6: Strategies live in Washington. I'm Joe Matthew alongside Kaylee Lines.
15:47
Speaker 3: I'm Bloomberg. Stay with us on Balance of Power. We'll
15:50
Speaker 3: have much more coming up after this.
15:55
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Speaker 1: eleven thirty.
16:14
Speaker 2: We're also expecting to hear shortly from President Trump as
16:17
Speaker 2: he signs an executive order pertaining to military families in
16:19
Speaker 2: the Oval Office, but is likely to take questions.
16:22
Speaker 4: From reporters as well.
16:23
Speaker 2: We'll be bringing to you those to you live as
16:25
Speaker 2: we consider the path forward on Iran, and also look
16:29
Speaker 2: for the President's reaction to the deal that was struck
16:31
Speaker 2: between the DOJ and Senators John Cornyn and Tom Tillis.
16:34
Speaker 2: Of course, the two Yola Republicans who were holding up
16:36
Speaker 2: the confirmation process of Todd Blanche to be the next
16:39
Speaker 2: Attorney General. They wanted in writing that the Anti Weaponization
16:43
Speaker 2: Fund would be dead. They wanted clarity around the IRS
16:46
Speaker 2: immunity for President Trump, and as of eleven pm last night, Shoe,
16:50
Speaker 2: they got it, and they're prepared to vote yes on
16:51
Speaker 2: Blanche tomorrow morning. In the Judiciary.
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Speaker 3: They got it in writing.
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Speaker 6: I'm looking at Todd Blanche's letter here, which is a
16:57
Speaker 6: couple of pages long and refers to some of the
17:01
Speaker 6: frivolous lawsuits in the language that the Attorney General Acting
17:05
Speaker 6: Attorney General used here challenging the fund. At least one
17:09
Speaker 6: court has declined to dismiss those claims as moot. What
17:12
Speaker 6: is important here, as he writes, no members were appointed.
17:16
Speaker 6: Fund is not operative, no funds were transferred, no process
17:20
Speaker 6: for receiving claims established, no claims were paid. This sort
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Speaker 6: of establishes beyond any doubt that there is no fund
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Speaker 6: that was enough to your point, the Yolo Caucus to
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Speaker 6: climb down.
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Speaker 10: Yep.
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Speaker 3: So he's as good as confirmed, seems so.
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Speaker 2: At the very least, it seems he will be getting
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Speaker 2: out of the Judiciary Committee come nine am roughly tomorrow morning.
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Speaker 6: Question is can they do this on the floor of
17:41
Speaker 6: the Senate before everybody leaves town at the end of
17:43
Speaker 6: the week. That's a question that applies to a number
17:45
Speaker 6: of issues, including government funding. And it's where we start
17:47
Speaker 6: with our political panel. Bloomberg Politics contributors Genie Shanzano and
17:51
Speaker 6: Rick Davis are back together once again. Genie is our
17:54
Speaker 6: democratic analyst and democracy visiting fellow at Harvard Kennedy School's
17:57
Speaker 6: Ash Center. Rick our republican strategist, partner at Stone Court Capital.
18:02
Speaker 3: It's great to see both of you. Genie.
18:04
Speaker 6: Should we assume that Todd Blanche will have the full job.
18:08
Speaker 10: He likely will. I mean, he's certainly going to get
18:11
Speaker 10: out of committee, and then it's going to be a
18:13
Speaker 10: question of do Republicans Keith Deherpraks together on the floor.
18:18
Speaker 10: I do think he's going to get the job. I
18:21
Speaker 10: am not confident that Murkowski or Cassidy or Collins will
18:25
Speaker 10: vote against him, but he can't. You know, they can't
18:29
Speaker 10: lose the two. So with Mitch McConnell out there, you know,
18:32
Speaker 10: it's very tight in there. But I think one thing
18:35
Speaker 10: about this entire endeavor is it's a bit of a firse.
18:39
Speaker 10: This is an agreement between the federal government and Donald Trump.
18:43
Speaker 10: On page four of the agreement, it says that those
18:47
Speaker 10: parties are the ones who can change it. So the
18:50
Speaker 10: federal government has pulled out of it in the signing
18:53
Speaker 10: of Todd Blanche, But you know who hasn't pulled out
18:55
Speaker 10: of it, Donald Trump. And so I'm not confident that
18:59
Speaker 10: this thing is only dead. And of course, when we
19:01
Speaker 10: hear from Donald Trump, if he takes questions in a
19:04
Speaker 10: few minutes, he could also throw a monkey runch into
19:06
Speaker 10: the proceedings as well.
19:09
Speaker 2: Well, that's very true. He of course yesterday said that
19:11
Speaker 2: he wishes or over the weekend said he wishes the
19:14
Speaker 2: Anti Weaponization Fund isn't dead, which Tom Tillis certainly took
19:18
Speaker 2: note of. So, Rick, I guess it becomes a question
19:21
Speaker 2: of whether you still think there could be disruptions in
19:23
Speaker 2: this process or it's glide path from here.
19:27
Speaker 5: Yeah, I'm not exactly sure based on what Genie was
19:30
Speaker 5: saying about, you know, Murkowski and Cassie and some of
19:33
Speaker 5: these other people, that it's as smooth as you would
19:36
Speaker 5: think it would be. Certainly, I doubt if they would
19:39
Speaker 5: agree to a unanimous consent procedure to bring it up
19:43
Speaker 5: and skip a lot of time, which they don't have.
19:46
Speaker 3: Look, a lot of people don't like.
19:47
Speaker 5: Him as the future attorney general because he supported the
19:52
Speaker 5: president's pardons against the most awful offenders of the law
19:56
Speaker 5: on January sixth. He has done his own version of
20:02
Speaker 5: you know, uh, retribution, going after people like Komi, and
20:06
Speaker 5: and and and and Brennan. So so, there are a
20:10
Speaker 5: lot of Republicans beyond just this policy issue that has
20:14
Speaker 5: been negotiated who have a lot of anxiety about this individual.
20:19
Speaker 5: So separating cutting a deal on a policy to get
20:23
Speaker 5: your way into a job versus being the right person
20:27
Speaker 5: for the job.
20:28
Speaker 9: And I think that's a really dangerous.
20:32
Speaker 5: Kind of uh uh you know, uh example to use
20:35
Speaker 5: in the future. I mean, if every single person who
20:38
Speaker 5: gets confirmed for Senate confirmation has to like cut a
20:42
Speaker 5: deal on a policy issue, it could be total chaos
20:47
Speaker 5: when it comes to trying to get people approved. And
20:50
Speaker 5: I as much as I appreciate the fact that they
20:52
Speaker 5: did the right thing and got this deal on the
20:55
Speaker 5: Anti weaponization fund and and and and you know the
20:59
Speaker 5: tax issue, it's a really bad precedent. And so is
21:03
Speaker 5: he a guy Todd blanche who you want to have
21:06
Speaker 5: as your attorney general?
21:07
Speaker 3: And if not, you should vote against him.
21:09
Speaker 5: I mean, it's about him, it's not about the policies
21:12
Speaker 5: of this administration.
21:14
Speaker 6: Well, it's a great point, Rick, I wonder if you
21:16
Speaker 6: believe that the president could impact the outcome of whatever
21:20
Speaker 6: confirmation vote is looming here based on what he is
21:22
Speaker 6: about to say or not say in the Oval office.
21:25
Speaker 6: Every time he's had the opportunity, he has reignited the
21:28
Speaker 6: Anti weaponization Fund.
21:30
Speaker 5: Yeah, look, this President is hugely powerful when it comes
21:34
Speaker 5: to Capitol Hill. For a Republican in the Senate to
21:36
Speaker 5: defy him is a act of courage because you know
21:41
Speaker 5: the reaction is going to be intense, just ask Senator Cassidy.
21:45
Speaker 5: But at the end of the day, yes, he could
21:47
Speaker 5: ignite this in the next hour, and all of a
21:50
Speaker 5: sudden there's going to be a scramble for how do
21:52
Speaker 5: we actually get to these votes we need on the
21:54
Speaker 5: floor to confirm him. And so I'm not sanguine about
21:58
Speaker 5: the fact that this is over yet.
22:02
Speaker 2: Well it may not be over, and as you were
22:04
Speaker 2: pointing to Rick, they might need a time agreement if
22:06
Speaker 2: they want to try to get it done by the
22:09
Speaker 2: recess or just get to a vote.
22:10
Speaker 4: Regardless of what way the vote goes.
22:11
Speaker 2: They have a lot they want to do this week
22:14
Speaker 2: before they're all supposed to fly out for a number
22:16
Speaker 2: of weeks, Genie, including a procedural vote. This afternoon five
22:21
Speaker 2: thirty pm Eastern is one is expected to try to
22:23
Speaker 2: advance a continuing resolution to keep the government funded beyond
22:27
Speaker 2: the end of the fiscal year. This one's a little
22:28
Speaker 2: longer than the House packed cr before they left town.
22:32
Speaker 2: This one goes through December eleventh. Democrats seem to be
22:36
Speaker 2: on board with this one. Is this what's going to
22:38
Speaker 2: avert a shutdown?
22:41
Speaker 10: I don't know for sure if it averts a shutdown,
22:44
Speaker 10: because of course, even if it passes the Senate, it's
22:47
Speaker 10: got to go to the House when they come back
22:49
Speaker 10: from recess. And there's a lot in this thing that
22:52
Speaker 10: the House is going to object to, and of course
22:55
Speaker 10: there's a lot in it that the White House is
22:58
Speaker 10: going to object to. And that is what has been
23:01
Speaker 10: another continuing sort of saga in Washington, which is the
23:05
Speaker 10: back and forth or the lack of communication if you will,
23:08
Speaker 10: between John Thun and President Trump. There is no love
23:11
Speaker 10: lost there. Donald Trump is not happy with how John
23:15
Speaker 10: Fuon is moving the Senate at this point. Certainly he's
23:21
Speaker 10: not going with the getting rid of the filibuster. No
23:23
Speaker 10: Save Act Reconciliation is put aside trying to get this
23:27
Speaker 10: CR through, which limits the president's power in certain ways.
23:32
Speaker 10: So I think this is going to be an uphill battle.
23:35
Speaker 10: I do think there is an incentive with the election
23:38
Speaker 10: so soon after they get back to keeping the government running.
23:41
Speaker 10: I don't think it helps anybody to shut down the government,
23:44
Speaker 10: but I think This is going to be a family
23:46
Speaker 10: fight between Republicans if this thing passes the Senate. When
23:50
Speaker 10: the House gets back and you get Donald Trump going
23:53
Speaker 10: back and forth with Puon, I mean, I'm really interested
23:56
Speaker 10: to see does Donald Trump support somebody this year to
24:01
Speaker 10: challenge John Thune on the House on the Senate of
24:04
Speaker 10: floor rather for leadership. I think that's a real possibility here.
24:09
Speaker 6: That would be something we were talking to Nathan Deane
24:12
Speaker 6: a little bit earlier. Rick the head of US policy
24:16
Speaker 6: analysis at Bloomberg Intelligence, and he was highlighting this very issue.
24:21
Speaker 6: When everybody comes back from August, the push and pull
24:24
Speaker 6: between the House and Senate among Republicans could in fact
24:27
Speaker 6: lead to a government shutdown.
24:29
Speaker 3: Do you see that as a possibility. Yeah, for sure.
24:33
Speaker 5: This has been a dysfunctional Congress since it began a
24:37
Speaker 5: year and a half ago. The closer you get to
24:40
Speaker 5: an election, the more you create independent actors who are
24:45
Speaker 5: acting in their own self interest politically, right, everyone's kind
24:48
Speaker 5: of been towing the party line, and you still had
24:51
Speaker 5: a lot of disruptions. Can you imagine when everyone's acting
24:53
Speaker 5: in their own self interest, so at the end of
24:55
Speaker 5: the day, yeah, I think you add an element of
24:58
Speaker 5: political manipulation into.
25:00
Speaker 3: The Congress, and.
25:03
Speaker 5: With only you know what two weeks basically of legislative
25:07
Speaker 5: time to get all this stuff done. It's you can't
25:10
Speaker 5: let anything go wrong, and I think the chance that
25:13
Speaker 5: a lot goes wrong is more standard with this Congress.
25:18
Speaker 2: Well, I'd like to ask you about another matter, Rick,
25:21
Speaker 2: the Russia Sanctions Bill that has now turned into a
25:24
Speaker 2: Russia and Iran Sanctions Bill that would grant some more
25:26
Speaker 2: tariff authority back to the president against buyers of those countries'
25:31
Speaker 2: energy products. What do you expect the fate of it
25:34
Speaker 2: will be? Knowing it got eighty six votes on the
25:36
Speaker 2: first procedural vote in the Senate, but it does give
25:39
Speaker 2: the president more tariff power. Is this something that's going
25:42
Speaker 2: to get all the way through to the President's desk?
25:44
Speaker 4: Yeah.
25:44
Speaker 5: I think these sanctions are wildly popular, and I think
25:47
Speaker 5: that as long as the President doesn't abuse his authority
25:50
Speaker 5: in this new power that they're giving them to do
25:53
Speaker 5: secondary sanctioned tariffs on countries that are buying Russian and
25:57
Speaker 5: in future Iranian oil. I think that Republicans and Democrats
26:02
Speaker 5: together believe it's good policy and hope that the President
26:05
Speaker 5: doesn't abuse these powers.
26:08
Speaker 2: Jeanie, do you agree with that.
26:11
Speaker 10: I think it may pass, but I think this is
26:13
Speaker 10: a dangerous power to grant to this president in the
26:17
Speaker 10: hope he doesn't use it more full throatedly and then
26:21
Speaker 10: we would like and I think that's a real possibility
26:24
Speaker 10: with him, all.
26:26
Speaker 2: Right, Jeanie Shanzino and Rick Davis, both of them Bloomberg
26:29
Speaker 2: Politics contributors. Thanks for joining us.
26:31
Speaker 3: Stay with us on Balance of Power. We'll have much
26:33
Speaker 3: more coming up after this.
26:38
Speaker 1: You're listening to the Bloomberg Balance of Power Podcast. Catch
26:41
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26:57
Speaker 3: Thanks for being with us.
26:58
Speaker 6: With big earnings coming up this week, Charlie's going to
27:00
Speaker 6: have a lot to chew on the next several days.
27:02
Speaker 6: It all gets rolling after the bell this evening with
27:05
Speaker 6: palanteer As I read pretty cool. Ninety percent of S
27:10
Speaker 6: and P five hundred companies have reported profits that beat expectations.
27:14
Speaker 6: So think about that the next time we start talking
27:16
Speaker 6: about a correction.
27:17
Speaker 3: It is.
27:17
Speaker 6: In fact, if this holds together here, this will be
27:19
Speaker 6: the strongest quarter for corporate profit growth in five years
27:23
Speaker 6: since we got out of COVID, and everyone's obsessed all
27:27
Speaker 6: day along with sk Heinez. Things are going pretty well
27:31
Speaker 6: for corporate America. And we're going to hear this week,
27:33
Speaker 6: as I mentioned, from a lot of companies including down
27:36
Speaker 6: aimes like McDonald's and Disney. We'll have some tech as
27:38
Speaker 6: well with AMD SpaceX tomorrow, we'll be talking more about it.
27:43
Speaker 6: With ninety two days until the midterm elections, yes, we're counting.
27:50
Speaker 6: Senators are tuned not just to the midterms but to Friday.
27:55
Speaker 6: It's going to be a big old episode of the
27:58
Speaker 6: amazing race to get out out of town by the
28:00
Speaker 6: end of the week and see if they can actually
28:02
Speaker 6: get anything done while they're at it.
28:04
Speaker 3: Here it's a big to do list.
28:06
Speaker 6: John Thune's been here before and we don't expect him
28:09
Speaker 6: to get the whole thing done. But we did want
28:10
Speaker 6: to spend some time with our friend Nathan Dean to
28:12
Speaker 6: figure out exactly how this might go, because remember, reconciliation
28:16
Speaker 6: is going to take a back seat for the Senate
28:18
Speaker 6: majority leader. He wants to actually fund the government, knowing
28:21
Speaker 6: that if no one's getting along now, well they're not
28:23
Speaker 6: even going to be talking when they come back after
28:25
Speaker 6: August recess because it's going to be a full on
28:27
Speaker 6: sprint to yes the election. So how about we just
28:29
Speaker 6: kick the can now and fund the government. Nathan saw
28:33
Speaker 6: this coming a mile away. He told us that's how
28:34
Speaker 6: it was going to happen. And here we are on
28:36
Speaker 6: the verge of a procedural vote that will take place
28:39
Speaker 6: at five point thirty pm Eastern time. So clients that
28:43
Speaker 6: called our friend Nathan actually got the straight deal, And well,
28:47
Speaker 6: so did you.
28:47
Speaker 3: Because you listened to Balance of Power.
28:49
Speaker 6: He's with us right now, our senior US policy analyst
28:52
Speaker 6: back in the city. It's good to have you in
28:54
Speaker 6: the capital, sir. With five days left, what can get
28:58
Speaker 6: done if not only the cr Well we.
29:02
Speaker 4: Told our clients this morning that even if the Senate
29:05
Speaker 4: passes this vote tonight, yeah, there is a funding fight
29:08
Speaker 4: coming in September. It's just a matter of who's the
29:10
Speaker 4: one fighting. So if the Senate does pass this bill,
29:13
Speaker 4: this bill does contain provisions out there that a doesn't
29:17
Speaker 4: have the Department Defense funding the White House was seeking.
29:19
Speaker 4: It also has a couple of revisions there. The White
29:21
Speaker 4: House is not going to like like not allowing a
29:23
Speaker 4: political appointee to issue grants, because remember this is a
29:27
Speaker 4: bipartisan bill that has to sign off of some Democrats.
29:30
Speaker 4: So if this bill goes forward comes September, the fight
29:33
Speaker 4: isn't between Republicans and Democrats. It's between the Senate, the House,
29:37
Speaker 4: and the White House. That's a different dynamic that if
29:39
Speaker 4: you were to fight over, let's say, if you're just
29:41
Speaker 4: going to debate the House bill, which is just a
29:44
Speaker 4: short term funding gap to December fourth, that's a fight
29:47
Speaker 4: between Republicans and Democrats. So regardless of what happens, you're
29:50
Speaker 4: going to get a fight in September. But if you'd
29:52
Speaker 4: read our notes, we're at a forty percent chance of shutdown.
29:54
Speaker 4: And I am hearing from a lot of people in Washington, yeah,
29:56
Speaker 4: telling me that I'm actually too high on that.
29:58
Speaker 3: Wow.
29:58
Speaker 6: All right, you're at forty percent for a shutdown. All right,
30:01
Speaker 6: So if you missed the last episode on The Amazing Race,
30:04
Speaker 6: what do they say? You know, scenes from last week?
30:07
Speaker 6: The House passed a CR yep, I thought that was
30:11
Speaker 6: a good thing. Then they all left town. Senate passes
30:14
Speaker 6: its own CR different version has to go back to
30:17
Speaker 6: the House then following recess, and you're saying that's when
30:20
Speaker 6: the fight breaks out.
30:21
Speaker 4: Yeah, I think that's when the fights breaks out. Because look,
30:23
Speaker 4: if the White House says, Okay, the Senate deal contains
30:26
Speaker 4: these provisions that limits me, and look that limits only
30:28
Speaker 4: through December eleventh, so it's only through the funding period.
30:31
Speaker 4: But still if it got through the December eleventh period,
30:33
Speaker 4: then what it happened forward looking the White House says, look,
30:37
Speaker 4: I don't want any curbs on me whatsoever. And Senator
30:39
Speaker 4: Kennedy even floated this and said, we may not want
30:42
Speaker 4: to give curbs on who in the executive branch can
30:45
Speaker 4: improve grants. If that doesn't fly, President Trumpkin could just
30:49
Speaker 4: come in through a truth social post and say I
30:51
Speaker 4: don't support this, you need to pass the House version,
30:53
Speaker 4: and then that puts us back at square one.
30:55
Speaker 6: So this is a proposed omb rule that you've mentioned
30:59
Speaker 6: a couple of times. This needs to be on your
31:01
Speaker 6: radar if you care about this stuff. That would expand
31:04
Speaker 6: the administration's power to rescind grant funding in the end, right,
31:08
Speaker 6: that's what they want, and this could derail government funding.
31:13
Speaker 3: To the point of a shutdown.
31:14
Speaker 4: Well, I don't think it's going to do real it
31:15
Speaker 4: because ultimately, and this is why I was out of
31:17
Speaker 4: forty percent. Remember, some folks in the Capitol are telling
31:20
Speaker 4: me I'm too high here. But why am I at
31:23
Speaker 4: forty percent? Why I don't think a shutdown is going
31:24
Speaker 4: to happen because it's right before an election, and whether
31:27
Speaker 4: you're a Republican or Democrat, you know, having a shutdown
31:30
Speaker 4: right before the election is bad politics. Now, some will
31:33
Speaker 4: come back and say the Democrats in twenty twenty five,
31:35
Speaker 4: they didn't pay a political price for embracing a shutdown.
31:38
Speaker 4: That's true. But when you are a Democrat and right
31:41
Speaker 4: now the prediction markets suggest that you're going to take
31:44
Speaker 4: the House of Representatives. Yes, you don't want to do
31:46
Speaker 4: any harm.
31:46
Speaker 6: You just want to let us go through December eleventh.
31:48
Speaker 6: That wouldn't get us past the election.
31:51
Speaker 4: Well, I mean, it gets us through. But taking that
31:53
Speaker 4: vote right now, I understand, you know, taking that business
31:56
Speaker 4: right before the election.
31:57
Speaker 3: This is before the election.
31:58
Speaker 4: This is September thirtieth.
31:59
Speaker 6: So let's put that on the back burner for a minute,
32:01
Speaker 6: because again five point thirty, by the way, this will
32:03
Speaker 6: pass the procedural right yeah, okay.
32:05
Speaker 4: I think it will.
32:07
Speaker 6: Is it time for deathwatch on clarity?
32:10
Speaker 3: Crypto is blowing in the wind Nathan Dean.
32:13
Speaker 4: So you know, and you heard me say this this
32:15
Speaker 4: morning to my clients, is that I like to say,
32:17
Speaker 4: if I get something wrong, I'm going to buy you
32:19
Speaker 4: a Bloomberg coffee. Now, full disclosure, Bloomber coffees are free
32:22
Speaker 4: in the pantry. They're very good, but they are very good,
32:25
Speaker 4: especially for the price point. But where I am going
32:27
Speaker 4: with this is that it is beginning to sound like
32:29
Speaker 4: I owe a bunch of clients Bloomberg release. No, wow,
32:32
Speaker 4: I'm not changing my odds right now. Yeah, because my
32:34
Speaker 4: core theory on this is that the crypto folks want
32:37
Speaker 4: to deal because if not, in two years a Democrat
32:39
Speaker 4: could ruin the party. The banks want a deal because
32:42
Speaker 4: if not, the crypto platforms get two years under a
32:44
Speaker 4: friendly regulatory environment. And moderate lawmakers want a deal because
32:48
Speaker 4: if not, crypto political action money is a real thing
32:51
Speaker 4: and will either combat or support that candidate. But at
32:54
Speaker 4: the end of the day, you know, the Democrats who
32:57
Speaker 4: are needed to get this past the line. You know,
33:00
Speaker 4: there is a lot of hesitation here because now you
33:03
Speaker 4: know these anti cryptos sort of like anti data center.
33:05
Speaker 4: Now you have to think about twenty twenty eight aspirations
33:07
Speaker 4: and so forth. There's other things coming into you. But
33:10
Speaker 4: I wouldn't be surprised, So put this in your low
33:12
Speaker 4: probability event. I wouldn't be surprised if you saw a
33:15
Speaker 4: bunch of Democratic lawmakers if there was a cloture vote
33:18
Speaker 4: saying you know what, I want to vote to keep
33:20
Speaker 4: the party going. Let's keep negotiations going through the August
33:23
Speaker 4: recess as do not upset the crypto packs prior up
33:27
Speaker 4: until say September. But again, that's a low probability. That's
33:32
Speaker 4: more of this.
33:33
Speaker 3: This is good logic, that's fascinating.
33:34
Speaker 4: Stuff that you should just talk around the water cooler
33:36
Speaker 4: or the bloomber cral.
33:37
Speaker 3: So you're forty your sixty forty sixty six for clarity.
33:41
Speaker 4: For clarity. But again, I'm out a consensus, and I
33:44
Speaker 4: think I may owe a lot of people coffees.
33:45
Speaker 6: Listen to how transparent this guy is. Now, if you
33:47
Speaker 6: turn out to be right, what do we owe you?
33:51
Speaker 4: Just read my next iteration of the replive.
33:53
Speaker 3: And subscribe to his podcast.
33:55
Speaker 6: All right, I'm gonna keep ticking down the list here
33:58
Speaker 6: reconciliation three point zero is in nowhere land in the Senate.
34:02
Speaker 3: They're going to do that? Are we serious when they
34:05
Speaker 3: get back?
34:05
Speaker 4: I'm at thirty eight thirty percent chance of reconciliation getting
34:08
Speaker 4: deal unless there's substantial changes to this. Now, the problem
34:11
Speaker 4: with reconciliation is is that it's you know, largely Department
34:15
Speaker 4: of Defense funding for the Iranian war. You're not going
34:18
Speaker 4: to get any much Democratic support on that. And you're
34:21
Speaker 4: forcing Republicans in moderate races and I'm looking at Maine
34:24
Speaker 4: here to take votes where American voters are not very
34:28
Speaker 4: popular at least don't have a favorable opinion of the
34:31
Speaker 4: Iranian conflict. So it's a very difficult thing here. You
34:33
Speaker 4: also have farm made eleven billion dollars. That's bipartisan. That's
34:36
Speaker 4: not the issue.
34:37
Speaker 3: Sure.
34:37
Speaker 4: The problem is is that you have some folks in
34:39
Speaker 4: the Senate saying, look, I don't want this, I want
34:41
Speaker 4: three hundred and fifty billion dollars for the Department of Defense.
34:44
Speaker 4: You also have folks saying, yeah, that's what the President
34:46
Speaker 4: asked for. You also have folks saying there's no offsets here,
34:49
Speaker 4: and so you're just going to increase the.
34:50
Speaker 3: Deficit voting some Republicans.
34:52
Speaker 4: And we haven't even talked about the Safe America Act,
34:54
Speaker 4: you know, the Senate parliamentarians mostly you're going to come
34:56
Speaker 4: in and say you can't do it. Long story, short days.
34:59
Speaker 4: Is that need a miracle to get through? And I'm
35:02
Speaker 4: not saying it can't happen. I mean it's it's not,
35:04
Speaker 4: but a lot of it's got to have to move
35:06
Speaker 4: quickly before the allot.
35:07
Speaker 6: When we have lawmakers on the air, Republican lawmakers on
35:10
Speaker 6: the air, professing that this is as good as done,
35:13
Speaker 6: you're telling them to take that with a grain of
35:15
Speaker 6: salt right now.
35:16
Speaker 4: Well, I'm just saying, is let's look at the calendar.
35:18
Speaker 3: This could die on the vine.
35:20
Speaker 4: Yeah exactly. I mean my theory on this is that
35:23
Speaker 4: when we get to September, if you have a government
35:25
Speaker 4: funding fight, yeah, that's going to take up most of
35:28
Speaker 4: the time. You also have things like you got to
35:29
Speaker 4: get the farm bill done, you got to get National
35:31
Speaker 4: flund Insurance done. There are other things out there that
35:33
Speaker 4: have to happen by September. September thirtieth, it's a very
35:36
Speaker 4: tight window. Can they get reconciliation done in that period?
35:40
Speaker 4: Not so sure. And if you can try and get
35:42
Speaker 4: it for the lame duck maybe, but during the lame duck,
35:45
Speaker 4: I don't know. I mean, it's just it seems like
35:47
Speaker 4: there's a lot of different challenging portions here. I need
35:50
Speaker 4: to see Senator Thune come in here and say here's
35:52
Speaker 4: what the strategy is, and I haven't seen sure yet.
35:55
Speaker 6: If the Senate votes to advance the continuing Resolution tonight,
35:59
Speaker 6: it'll leap the Russia sanctions bill as the pending sort
36:04
Speaker 6: of legislative priority here. The sanctions wait till after recess
36:10
Speaker 6: as well. Are you focused on that?
36:11
Speaker 4: So we're not focused on it purely all that much
36:14
Speaker 4: because in our view, the Russia sanctions Bill comes down
36:16
Speaker 4: to President Trump. Yeah, if President Trump wants the bill
36:19
Speaker 4: to pass to put pressure on Russia, then all pass.
36:22
Speaker 4: You think that the support is there no matter what.
36:24
Speaker 4: But the thing from the investors that need to know
36:26
Speaker 4: here is that if the sanctions bill passes, it gives
36:29
Speaker 4: President Trump another tool to conduct tariffs. And this tool
36:33
Speaker 4: in particular allows President Trump to go back to the
36:36
Speaker 4: method of truth. Social posts coming in at eight am
36:39
Speaker 4: Eastern and then next thing, you know, you have to
36:41
Speaker 4: deal with the market volatility of the tariff for the
36:43
Speaker 4: next two to days before he either decides to move
36:46
Speaker 4: forward or scale it back. So the biggest thing is
36:49
Speaker 4: if that bill passes, you have to be on heightened
36:51
Speaker 4: watch for more tariff announcements.
36:53
Speaker 6: They're arguing about who's got better quality coffee the bureau
36:56
Speaker 6: here in Washington or at World Headquarters in New York.
36:59
Speaker 6: Do we have a consensus on this, James questionable quality CC.
37:04
Speaker 6: I've always had a pretty good coffee up there. You
37:06
Speaker 6: know what we have that they don't have, the cold
37:08
Speaker 6: brew yep. Is that part of your life. As soon
37:11
Speaker 6: as you get it, as soon as you get used
37:12
Speaker 6: to it, they're going to take it away. That's how
37:14
Speaker 6: that's going to work. Glad you're back. Hope you had
37:16
Speaker 6: a great trip with the family. I'm glad to see
37:19
Speaker 6: that the vest is on the fleece vest despite the
37:21
Speaker 6: warmth here and the humidity in Washington. He's here for you,
37:24
Speaker 6: ladies and gentlemen. Nathan Dean, Our, senior US policy analyst
37:28
Speaker 6: at Bloomberg Intelligence. He's hearing from the clients and we
37:31
Speaker 6: bring him out here every Monday. If you subscribe to
37:33
Speaker 6: the Balance of Power podcasts, by the way, you're going
37:35
Speaker 6: to get Nathan's and set you up every week here
37:37
Speaker 6: for policy here in Washington, d C. We'll assembled our
37:41
Speaker 6: political panel next. Also back today is Rick Davis alongside
37:45
Speaker 6: Jeanie Shanzano. They're going to be with us as we
37:47
Speaker 6: tackle a couple of the issues that we were just
37:49
Speaker 6: talking to Nathan about, and of course everything that's coming
37:53
Speaker 6: out of the White House today that may be changing
37:55
Speaker 6: before our eyes. CBS News just now reporting no new
37:58
Speaker 6: negotiations are planned between the US enter on We'll see
38:01
Speaker 6: what that does to the market. Thanks for listening to
38:06
Speaker 6: the Balance of Power podcast. Make sure to subscribe if
38:09
Speaker 6: you haven't already, at Apple, Spotify, or wherever you get
38:12
Speaker 6: your podcasts, and you can find us live every weekday
38:15
Speaker 6: from Washington, DC at noontime Eastern at Bloomberg dot com.