July 10, 2025 • 47 mins
Watch Joe and Kailey LIVE every day on YouTube: http://bit.ly/3vTiACF.
Bloomberg Washington Correspondents Joe Mathieu and Kailey Leinz deliver insight and analysis on the latest headlines from the White House and Capitol Hill, including conversations with influential lawmakers and key figures in politics and policy.
Former Vice President Mike Pence criticized Donald Trump’s tariff agenda, saying it was a starkly different approach to trade from his first term that would harm American consumers and businesses.
Pence told Bloomberg Television on Thursday that the tariffs enacted during Trump’s first presidency, when Pence served as the No. 2, were geared toward forcing nations to the negotiating table to lower barriers to trade. Pence said Trump was abandoning that approach for permanent import taxes. “We used tariffs and the threat of tariffs, principally focused on China, to leverage changes in behavior, but the objective was to essentially lower trade barriers and expand trade,” Pence said.
US Secretary of State Marco Rubio is scheduled to meet his Russian counterpart Thursday as the US prepares to send more weapons to Ukraine to help it fend off attacks from the Kremlin’s war machine.
Rubio and Russian Foreign Minister Sergei Lavrov are expected to hold talks on the sidelines of an Association of Southeast Asian Nations gathering in Kuala Lumpur, the State Department said.
The meeting comes as Russia has been pounding Kyiv and other Ukrainian cities with record numbers of drones and missiles, leading President Donald Trump to express his mounting frustration with President Vladimir Putin for keeping up attacks.
On this edition of Balance of Power, Joe and Kailey speak with:
- Jennifer Welch, Bloomberg Economics Chief Geoeconomics Analyst
- David Shimer, Biden National Security Council Director for Eastern Europe and Ukraine and Director for Russian Affairs. Senior Research Scholar at Columbia University’s School of International and Public Affairs
- Rep. Chuck Fleischmann, Republican representing Tennessee's 3rd District
- Sen. Shelley Moore Capito, Republican from West Virginia
- Rick Davis, Partner at Stonecourt Capital and Bloomberg Politics Contributor & Arshi Siddiqui, Former Senior Aide to Former Speaker Pelosi, and Founder/CEO of Bellwether Government Affairs
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
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Speaker 1 (00:00):
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(00:20):
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Speaker 2 (00:25):
Welcome to the Little Friday Edition. Yeah, Thursday is here
on Bloomberg Radio Satellite radio channel one twenty one.
Speaker 3 (00:32):
We're always on Bloomberg Originals.
Speaker 2 (00:33):
Now and of course on YouTube search Bloomberg Business News
Live if you want to join us here in the studio.
There's nothing on the president's schedule today. He's got a
quiet Little Friday at least so far. We know that
can change, and we've got our eyes on truth social
because well more letters could be going out this What
is this day after what was deadline day? Yeah, it's
(00:54):
the tenth of July and we've got a new deadline,
as we've discussed when it comes to trade August one.
A whole bunch of letters dropped yesterday. And it's interesting
the way this all works because we keep seeing the
form letters. You know, they just change the number, change
the name at the top. Maybe the number in the copy,
but the one that went to Brazil certainly got some
(01:17):
attention yesterday as the President not only slaps a fifty
percent tariff on goods coming in from Brazil, but goes
on a long missive and it's not just truth social
it's actually in the letter about former President Balsonaro, the
censorship of American social media and so forth, making many
wonder exactly what is driving the trade policy in this
(01:38):
White House? Is this getting a little personal. Mike Pence
talked about it today, the trade policy that is you
see Mike Pence on Bloomberg Surveillance. The former Vice President,
of course, has been making the media arounds, has a
lot of nice things to say, most recently about this
second Trump administration when it comes to the big beautiful bill,
when it comes to strikes against Iran, not so much tariffs.
(02:00):
Here's Mike Pence from this morning.
Speaker 4 (02:02):
What we saw several months ago and now it's paused again, happily,
is the kind of broad based industrial policy that I
think ultimately will harm the American economy. What I like
to say is free trade with free nations. Be tough
on China, be tough on trade abusers, but have the
objective of ultimately lowering trade barriers, and that's how America
(02:25):
wins and prospers.
Speaker 3 (02:27):
Free to be you and me.
Speaker 2 (02:29):
The old Republican is coming out of the former governor
of Indiana, longtime Congressman Mike Pence. Interesting reflecting with the
old line and the Republican Party, which of course had
an allergy to tariffs. Then again, Mike Pence seems to
think tariff's worked all right the way they did it
surgically speaking strategically in the first administration. This across the
(02:49):
board throwing of darts and now adding personal affections to
tariff decisions is making everybody wonder and it certainly is
making Wall Street skip a little bit of beat today.
You heard from Charlie Pellow. This isn't a massive sell
off here, but maybe a little pause in the rally now.
We want to get to all of this and what
this means for what will be our future trade relations
(03:12):
with countries around the world by the first of August.
Not to mention what's happening elsewhere when it comes to
foreign policy. In this White House with a great voice
of experience working out of the newsroom here in Washington, DC,
that's Jenny Welch, Bloomberg Economics chief geoeconomics analyst, a veteran
of the Biden White House, and Jenny gets great to
have you with us here, as always on balance of
(03:32):
power here on Bloomberg. What do you make specifically of
the Brazil letter, the fact that he's calling out a
former president who's facing charges over an attempted coup. This
is giving the market some agity here to think that
Donald Trump is capable maybe of more than some thought
when it comes to throwing tariffs around. Jenny, how do
(03:52):
you see it?
Speaker 5 (03:54):
Thanks, Jera. Well, as you noted, this letter stands out
from the others and that he's taking aim at Brazil
over polluted issues. Certainly, we've seen the Trump administration criticize
other countries for their handling of political leaders who share
some of the same politics as President Trump, but this
is the first time he's used the cudgel of tariffs
to sort of reinforce those threats or that's criticism. I
(04:15):
also suspect this isn't just about former President Volsnaro, but
might reflect on Trump's criticism of the Bricks, which held
their summit over the weekend. Afterwards, he saw him lobb
threats at the Bricks and partners associated with it over
what he characterized as anti American policies. Well, Brazil was
a host country for the Bricks and is largely supportive
(04:36):
of some of those policies that I think President Trump
criticized as being anti American. I think a lot remains
to be seen in how this few plays out. Obviously,
Brazil's initial response is relatively muscular assertives, saying we're going
to defend ourselves and retaliate privately. It's very likely they're
going to try and approach the administration negotiate. But what's
also different about Trump's letter to the President of Brazil
(04:59):
is that he did really offer an off ramp, and
the same way all the other form letters do, noting
the potential for negotiations. In that August first deadline, he
seems to be laying it down as though this is
what's going to.
Speaker 6 (05:11):
Happen, Jenny.
Speaker 2 (05:13):
He also talked about the Brazilian Supreme Court's hundreds This
is a direct quote, hundreds of secret and unlawful censorship
orders to US social media platforms in his letter to
President Lula DeSilva.
Speaker 3 (05:27):
What's he talking about?
Speaker 2 (05:28):
Here, and is this we've ever seen a crossover of
personal attitude toward politics with trade policy like this.
Speaker 5 (05:38):
I think what he might be referring to in part
is if you remember some of the view that happened
between Elon musk X in Brazil in the past. Now
that dispute was worked out separately, that could be part
of what Trump is referring to here. Was obviously something
that at the time he was paying pretty close attention to,
and in terms of the use of tariffs and sort
(05:59):
of advance, what you might frame here is more a
personal political issue. This is relatively unique. Obviously, we've seen
him use tariffs towards other non trade related policy concerns,
for example, the fentanyl related tariffs geared towards China, concerns
about the euse regulatory issues, leveraging teriffs, in his words,
(06:21):
to try and bring about peace between India Pakistan. Of course,
they would dispute that trade was part of those conversations.
But all that is to say Trump very clearly sees
terriffs as a tool that he can use to achieve
many different ends beyond the trade realm. However, this is
a unique case where he seems to be leveraging it
to try and influence domestic politics or what is seen
(06:43):
within Brazil as a domestic political issue.
Speaker 2 (06:46):
Well, we did hear back from little of de Silva
pretty quickly, actually, the response for the leader of Brazil
saying that his nation will not be tutored the word
he used by anyone, and that unilateral rate hikes will
be respons bonded to using Brazil's economic reciprocity laws. So
this has going pretty well so far. As we spend
time with Jenny Welch, I want to ask you about Ukraine. Jenny,
(07:09):
there is reporting today that weapons shipments from the US
have in fact resumed to Ukraine, and the news that's
coming out of Ukraine has been horrifying, hit with a
deadly attack once again. As Allies gather in Rome to
talk about post war revival, I don't know how we
can even advance the conversation to post war when we
(07:30):
can't get Vladimir Putin to stop bombing civilians. Jenny, what's
going to happen here when the United States runs out
of weapons that we can continue to draw down from
the Biden administration by the end of the summer, They're
going to need a new request, aren't they Yeah.
Speaker 5 (07:44):
I think one of the challenges here is, as you noted,
there's one set of authorities that the Biden administration use
called Presidential draw Down Authority, that allowed US to essentially
ship Ukraine weapons right out of US stocks. That authority
has been largely used up. US stocks to some in
the Pentagon are also severely depleted. And the challenge with
(08:04):
that is that was the authority that allowed us to
get stuck to Ukraine very quickly. There are other authorities
that allow us to, for example, manufacture new weapons for Ukraine,
and in fact, a lot of usaid to Ukraine was
in that form, allowing them to purchase US weapons or
for other partners to purchase US weapons on behalf of Ukraine.
But manufacturing those weapons takes a significant amount of time.
(08:26):
There is a backlog in many US customers who are
waiting for some of the same systems that Ukraine is
hoping to procure. This is the challenge that we've been
facing for months to a year now. Europeans are trying
to step up and fill in the gaps in US assistants,
but one of the key gaps that remains is on
air defense and specifically the capability that US patriot defense
(08:47):
batteries provide. That's one that's going to be really hard
to find an alternative to, and that's one that can
really make a huge difference in terms of defending, in
particular Ukrainian population centers and cities from Russian attacks.
Speaker 2 (09:00):
Well, Marco Rubio, the Secretary of State, met today with
Sergei Lavrov's Russian counterpart. They met along the sidelines of
the Assian Foreign ministers meeting in Malaysia. Not great when
you consider what he said coming out of this, Jenny,
it was a frank conversation, it was an important one.
It apparently did not advance the march to peace at all.
(09:20):
We only have about thirty seconds. Is this administration helpless
from a diplomatic standpoint right now?
Speaker 5 (09:26):
I think the administration has a lot of options at
their disposal. The key question is whether they want to
use them, and sations being the key option that we
haven't yet seen them willing to deploy in a stronger
form against Russia.
Speaker 3 (09:37):
I'm really glad you mentioned that, Jenny.
Speaker 2 (09:39):
We're going to talk later on this hour with our
political panel about the advancement of a sanctions bill in
the US Senate written up by Lindsay Graham. John Thune
says this could in fact head to the floor sooner.
It looks like the President is about to lean into this.
Jenny Welch, thank you so much. As always with Bloomberg Economics,
our geoeconomics analyst.
Speaker 1 (09:56):
Here, you're listening to the Bloomberg Balance of Power podcast
ketchs live weekdays at noon and five pm. He's durn
on Apple, Cockley and Android Auto with the blue Berg
Business App. You can also listen live on Amazon Alexa
from our flagship New York station Just Say Alexa played
Bloomberg eleven thirty.
Speaker 7 (10:16):
Don Kaylee lines alongside Joe Matthew here in Washington, where
we of course are keeping track of domestic developments and
changes on that front, but changes in geopolitics as well,
or at least changes in attitude it seems on the
part of President Donald Trump when it comes to the
ongoing war between Russia and Ukraine, of course, remembering he
promised to end the war on day one of his presidency.
(10:37):
Here we are in July with still no ceasefire agreement
having been made, though his administration has been pushing for one,
and he's expressed increasing frustration with the Russian President Vladimir
Putin in that regard, so much so, in fact, that
he actually reversed a decision made by his own Department
of Defense, which was, of course a pause of weapons
(10:58):
defensive webs in particular to Ukraine. That flow is now
resuming on the President's orders, and it's something that the
former number two to President Trump, at least during his
first administration, former Vice President Mike Pence, is pretty happy about.
He spoke earlier on Bloomberg Surveillance.
Speaker 4 (11:15):
I was pleased that the President countermanded what had been
a pause of aid to Ukraine last week, which I
think was unfortunate wherever it originated. I command the President
for reversing that decision. And my hope is when the
Senate reconvenes that Senator Thunal will put the Graham Bill
(11:40):
on the floor and put it on the President's desk.
Speaker 6 (11:43):
I think it's time.
Speaker 2 (11:45):
Counter Mandate is an interesting word that Mike Pence uses there,
and we want to bring this to an expert, A
voice of experience. David Scheimer spent time as the director
of the National Security Council's Eastern Europe in Ukraine, Peace
director for Russian Affairs.
Speaker 3 (12:01):
And the Biden White House.
Speaker 2 (12:02):
He's now senior research scholar at Columbia University's School of
International and Public Affairs, joining us.
Speaker 3 (12:09):
From World Headquarters in New York.
Speaker 2 (12:10):
David, it's great to have you on Bloomberg TV and
Radio bring us inside the bubble for this. Have you
ever heard of an instance quite like this where the
civilian leadership of the Pentagon acted without the approval of
the commander in chief.
Speaker 8 (12:25):
Great to be here. It's hard for me to comment
from the outside on the precise decision making that's occurring
on the inside, but what I can say is that
when I was serving at the National Security Council, there
was a robust interagency process where on a daily basis,
decisions were being made on support for Ukraine at meetings
(12:46):
that were chaired by the White House, with participation from
the Department of Defense, from State, from the intelligence community,
and from others, such that coordination would take place and
folks being overruled after the fact wouldn't actually have to occur.
Whether that process this is still taking place, I think
is in some doubt given the tell mote and changeover
at the National Security Council, and elsewhere. And I do
(13:07):
think that this is a reminder as to the value
of having a robust, rigorous government decision making process around
issues as serious as these.
Speaker 7 (13:16):
Well, So, putting aside how exactly the initial decision was made,
let's focus on the President's decision to reverse the initial
decision to resume the flow of aid to Ukraine, knowing
that there was a time at which we thought that
Ukraine did not necessarily have the explicit support of this
particular president. What does it signal to you, David, that
(13:36):
this reversal happened, What it means for the way in
which the President may be looking at the conflict between
Ukraine and Russia now versus before.
Speaker 8 (13:44):
So I think it's certainly a good step to reverse
whatever pause or decision had been made to halt aid
to Ukraine, because Ukraine needs the support and it's in
US interest to provide Ukraine with the support. However, I
also want to make clear that what was pause that
has now been unpaused is aid that was authorized during
the Biden administration, during the administration in which I was
(14:06):
a part, and that was a drawdown package of one
point twenty five billion dollars authorized in December of last
year that has lasted up until this summer, as well
as what's called USAI deliveries that are similarly contracted for
last year, and the problem is that those deliveries are
running out. And so even though the pause has been lifted,
which again is a good step, what matters far more
(14:28):
is whether this administration will go further and authorize additional
new support for Ukraine which will provide continued flows over
time and enable Ukraine to continue to defend itself over time.
And I very much believe that they should do that.
Speaker 2 (14:42):
Well, that's a great point that you make here. So
we're set to go through the end of summer, which
is in about five minutes. You've actually gone through this process.
Would the administration not have to submit an emergency supplemental
request now to prevent a gap in weapons shipments?
Speaker 3 (14:58):
And what would you be asking for?
Speaker 2 (15:00):
These be defensive systems like patriots or offensive ballistic missiles.
Speaker 8 (15:05):
So as a side point, I struggle with the distinction
in this context between defensive and offensive systems because Ukraine
is defending itself and Ukraine is now being provided with
artillery and rockets to defend itself. That has been unpaused,
and so I don't find that distinction especially useful. But
taking a step back from that, I would also say
that there is approximately three point eight billion dollars in
(15:28):
draw down authority that still remains available to the President
of the United States to use without having to go
to Congress, and so tomorrow this administration could decide to
draw down additional weapons from US stockpiles for Ukraine without
additional funding or authorization from the Congress's point one point
two is that the Europeans and the Ukrainians have set
explicitly that they want to buy weapons from the United
(15:50):
States to give to Ukraine, and so not only would
we be furthering our support for Ukraine, there would also
be additional generated revenue and trade inflows into the United States.
That is another available option to the United States to
get weapons to Ukraine. And so there are options to
maintain our support beyond what was authorized in December. The
question is whether those options will actually be executed upon.
Speaker 9 (16:13):
Well.
Speaker 7 (16:13):
And when we consider the options that the administration has
to exercise leverage or to try to influence the behavior
of Russia specifically, I wonder what you make, David, of
the sanctions package that it seems there is building momentum
toward at least in the United States Senate and possibly
with the White House as well. What would this particular
package of sanctions do that all of the other previous
(16:36):
sanctions package, including the ones that of course were pursued
by the Biden administration, due to alter the behavior of
Vladimir Putin when he is still engaged in this war
consistently throughout all of those sanctions being implemented.
Speaker 8 (16:48):
So absolutely, I think if we just take a step
back here, the reason that Ukraine has agreed to a
cease fire but Russia has not is because Russia and
President putn't believe that time is on his side. Seize
US support is declining. He believes that the longer this
war goes on, the more likely it is that his
battlefield position will improve compared to Ukraine's. And so the
objective in order to get to a ceasefire should be
(17:11):
to affect Puden's calculus and make him believe the time
is not on his side. And how do you do
that A you continue and even surge weapons flows as
we just discussed. B To your point, I believe that
sanctions against Russia's energy sector should be intensified, built upon
sanctions that have already been implemented, in order to increase
the pressure on the Russian economy and make it more
(17:31):
challenging for Russia to sustain its war of aggression. Third,
something that we haven't yet discussed is I believe that
the Europeans should move towards seizing the approximately three hundred
billion dollars in Russian sovereign assets that are immobilized in
its jurisdictions in order to provide Ukraine with a long
term source of support, both to help Ukraine but also
(17:52):
to send a message to Russia that aid for Ukraine
will not dry up with time. If you do those
three things, surge weapons, deliveries, intense I sanctions, and acquire
a long term source of assistance through the sovereign assets.
That recipe could be enough to adjust Pudent's thinking and
to put him push him to the table in a
meaningful way.
Speaker 7 (18:12):
All right, David, great to have you here on Balance
of Power. David Scheimer, former Director for Russia at the
National Security Council in addition to former Director for Eastern
Europe and Ukraine at the National Security Council.
Speaker 1 (18:21):
Plus, you're listening to the Bloomberg Balance of Power podcast
ketts live weekdays at noon and five pm. E's den
on Alma Cockley and Android Auto with the Bloomberg Business App.
Listen on demand wherever you get your podcasts, or watch
us live on YouTube.
Speaker 7 (18:39):
In our Washington, d C. Studio. Someone who is intimately
familiar with this process as well, sitting on the Appropriations
Committee in the House, Congressman Chuck Fleischman is joining US
Republican representing Tennessee's third district. Congressman, Welcome back to Balance
of Power. Always great to have you, and nice to
see you in studio. Because you're here in studio, I
could see you nodding along when Eric was suggesting it's
going to be really hard to meet that September thirtieth deadline.
(19:02):
You're betting on a continuing resolution.
Speaker 6 (19:04):
Well, I'm an optimist. I'm always betting on a budget.
But probably if you look at where things are, we
never want to see a government shutdown. I've lived through three.
It's not good, it costs more to reopen, and it
just really is disadvantageous for the entire nation, including markets
and the like. But what do I think will happen.
I'm actually riding the Energy and Water bill for appropriations.
(19:26):
We're going to mark that up next week in full committee.
But the reality is, you look at the clock and
things like that, probably a short term cr He's right,
we do not want a government shutdown. But the key
thing to remember, and I try to tell my friends
in my party this, it's going to take sixty votes
in the Senate to get an appropriations package, unlike reconciliation.
Speaker 2 (19:48):
So will Republicans have a posture that involves Democrats in
this process? What are you hearing from your colleagues across
the aisle.
Speaker 6 (19:56):
That's an interesting question. Right now, we're not receiving any
help from Democrats. I can tell you with pretty certainty
that my bill will pass out of my committee next
week with all Republican votes. Now, when we go to
the floor, that may be a different story. We have
obviously three wonderful factions in our party. Our moderates are
(20:16):
center right. I'm in the center right, and then are
folks who are further to the right. So we've got
to make sure that we hold our Republican votes together.
But every once in a while, when we see increases,
for example in the Office of Science, which I'm going
to put forth in nuclear energy. And I'm getting tremendous
bipartisan and bicameral support. Young progressivests who agree with me
(20:37):
on nothing come to me and support me on new
nuclear So we've got some things in some of these
bills that are going to be attractive. I just don't
know whether or not their leadership team in the House
and in the Senate will allow them to do that.
But the country does not want another continuing resolution. I
don't think we've ever had two in a row. They're
never good. They're preferable to a government shutdown, but they're
(20:58):
never good.
Speaker 7 (20:59):
We need a budget well, and so if getting Democrats
on board with the budget is required. Here to your
point on needing sixty votes in the Senate, do you
see the recisions package currently being considered by the Senate
as posing a danger to that bipartisan effort.
Speaker 6 (21:13):
There's no question that it's less palatable to our friends
in the Senate, both Republican and I think democratic over there,
largely Democrats. It will have a much easier time in
the House. Remember, the recision is rescinding taking back money
that's already been.
Speaker 7 (21:27):
Appropriated which is why Democrats are saying, why would we
make an appropriations deal with you if you can recancele it?
Speaker 6 (21:32):
Indeed, but going forward, and again the eternal optimist in
me says, let's look forward. Let's get our budget done.
The Energy and Water bill that I've written this year
for the House is as strong as it was in
twenty four. We passed it. It was great for energy,
especially in new nuclear. Twenty five we didn't get there.
Why because of the continuing resolution. So the reality is
(21:54):
you get out there, you put your best work product forward.
The other Cardinals, subcommittee chairs on approbe creations, Republicans have
written very good bills. We've passed some. Some are going
to be very difficult to pass.
Speaker 2 (22:06):
What do you think about the Mic Rounds of the
world who worry about eliminating funding for NPR And I
ask you this because you know, I believe it was
Bill Cassidy said last evening, a Senator from Louisiana got
to cut the funding because it's a partisan operation. But
there are some lawmakers like Senator Rounds to say this
is a lifeline for people in rural areas. You might
not like what's on the NPR network, but these local
(22:27):
newsrooms are delivering critical emergency information.
Speaker 6 (22:30):
Does he have a point, Well, he has a vote.
I don't know if he has a point, but he
has a vote. And I have heard that rhetoric coming
from some of my Republican colleagues, and prior to this discourse,
I never did understand or know that that dynamic was
out there. They feel that that is a lifeline to
many years in rural America. So if a senator particularly
(22:52):
feels that strongly about it, it is going to have
to be addressed. Again, there's not always an equal weight
between the House and the Senate. One senator can really
derail or stop a process, so we have to listen
to that. However, we need to see strong reforms. I
think at MPR there are things that are done there
(23:13):
that really need to be addressed. I would like to
see more of a political balance like we do on
your great show. We've got to listen to both sides
and let the American people then make their decisions. But
I come from the right. Either just come from the
left or the center. But the reality is we need balance.
Speaker 7 (23:31):
Well, as Joe makes the point about the role of
public notification, especially in these rural areas. That brings me
to a question around emergency response given what we've just
seen play out in Texas, but frankly is still unfolding
before our eyes with so many people remaining missing in
Hill Country. Tennessee is obviously no stranger to natural disasters either,
And I'm wondering if you're learning lessons about the way
(23:52):
in which information was distributed, if it's too early to
have those conversations as the still as an active rescue
effort and the station around reforms to FEMA as well
as this teaching us that you still need to have
the federal response able to be put into place.
Speaker 6 (24:06):
You raise an excellent point. Anytime we have a national
disaster where there's Tennessee or anywhere across the Great United States,
there's sadness, there's disaster, there's tragedy, there's sadly loss of
life and the like. After the event, we can learn
from these events sometimes how to predict these. We've seen
Doppler radars and things put in in my state over
(24:30):
the years to watch hurricanes and watch tornadoes. There's a
lot of tornadoes in Tennessee that touch down. These flooding
incidents were horrific. The one in Texas is of a
magnitude I don't think that we've seen in a long time.
It's really, really horrible. FEMA will be looked at, obviously.
I know Christinome very well, actually came into Congress with
a Secretary Nome, wonderful lady. She'll do a great job.
(24:53):
I think President Trump will do a good job. But
I think the American people want to see reform. They
want to see the these largest federal organizations, agencies that
have just really year after year just had bigger budgets,
loaded budgets and have not really spent wisely. I think
if we start to spend our money more wisely, they
(25:14):
need to be funded. I don't think you'll see FEMA
go away, but I think you're going to see a reformed,
stronger FEMA as well as other federal organizations that are
going to be more responsive to their ultimate constituents.
Speaker 2 (25:26):
Well, this event in Texas also reminds us of the
improvements needed to the grid, the electic grid that we
talked to you about a lot hard making the grid
as well. We just saw the President's big beautiful bill pass.
They were part of the celebration, of course, and we
saw watering down of incentives for solar and wind. Could
this bill do enough to secure nuclear, which is one of.
Speaker 3 (25:48):
Your most passionate issues.
Speaker 6 (25:50):
Thank you. Yes, it did a lot for nuclear. At
first we were very concerned. I was very concerned, as
was our very good Secretary of Energy, Chris Right, wonderful
man doing a good job about the nuclear tax credits.
Excuse the pun. Nuclear is hot right now. There's a
lot of private investment. Markets are moving towards investing a
(26:11):
lot of capital, and that was not the case five
or ten years ago. New nuclear is so important. Big
nuclear is important. I mean the larger nuclear power plants.
We're seeing three Mile Island reopen. We're going to see
a power plant Michigan, an older one opened. We had
Vogel in Georgia. So we're going to have small, mid
size and larger nuclear power plants. It's reliable, it's resilient.
(26:35):
But yes, the big beautiful bill was very good for nuclear.
I don't think it was as disadvantageous to some of
the things as solar as some of the people think
it will be. Solar I think is here to stay,
but it's got to find its place in the market.
Wind has problems. Wind has major, major problems, but ultimately
we're going to see natural gas come back very strong.
(26:57):
I think it's a very good bridge fuel. We're seeing TVA,
my utility building more gas as we get to nuclear.
Nuclear is incredible. But new nuclear right now is going
to take a lot of capital to build the first
of the kinds. But when you build the tenth and
the hundredths, it will drop down in costs. But the
nuclear industry in America is booming in every way well, and.
Speaker 7 (27:20):
We consider the role nuclear may have empowering artificial intelligence
and data centers going forward. To get that power to
a data center to allow the data center and the
data centers being built to allow that to happen, you
need copper for a lot of that transit. And the
President says, effective August first, there's going to be a
fifty percent tariff on copper. Do you worry about the
(27:40):
potential ramifications of that, knowing that by and large it
does not seem we have adequate supply to meet the
kind of demand that we are expected to see.
Speaker 6 (27:49):
We're going to wait and see where the President goes
with copper. But you're absolutely right, not only copper, but
there's other metals and minerals that are important for this process.
Of the reasons I support our national labs through the
Office of Science. I think have the best in the
country at Oakridge National Laboratory in oak Ridge. But the
reality is our labs are looking at ways to use
(28:12):
other products. Unfortunately, the Chinese have about a ninety percent
share of this market. They control a lot of this market.
We've allowed that to happen as we regained some of
that control with existing rare earths and things like that.
It's important, but the reality is maybe we can use
our labs to go out and find alternates that are
(28:32):
more reliable, less expensive, more resilient, and that's part of
our great national research that I don't think any other country,
even the Chinese can match.
Speaker 2 (28:41):
We actually spent some time with a young nuclear entrepreneur
who was at the White House a couple of weeks
ago to talk about the future of this technology. The
Governor of Utah joined him on the air to talk
about their project together. How quickly will we see these
small modular nuclear reactors being permanent for you? So I
realized a big nuke plant is another matter, but these
(29:02):
small modular reactors could be something that we see much sooner.
Speaker 6 (29:07):
Well. Fortunately, in the great state of Tennessee, with our
great utility, the Tennessee Valley Authority, we actually have a
permitted site at Clinch River, and that would be for
an SMR, a small modular reactor with less output. They're
smaller to build, they're easier to license. They've chosen a
g Yataci model which basically uses the existing fuel supply.
(29:29):
So when you talk to SMRs, you have to say,
what would the SMR if today look like, and then
maybe the SMR in five or ten years. The reason
for the other SMRs, we have very good designs out
there terror power x energy, but they require a higher fuel.
It's called halu, and actually, sadly Russia produces a lot
of halu. Is going to be a ban on that
(29:50):
in twenty twenty eight. But that's why I've worked so
hard in fiscal twenty twenty four to put up two
point seven billion dollars so that the United States could
then begin to have HALU and LU. Of course we
have LU as an existing fuel, but we want to
start enriching uranium domestically. Again. Think about it, We're the
(30:11):
birthplace of the Manhattan Project. We started this technology and
we've led it. Basically wither away America is coming back.
So we have American companies doing it. We're attracting other
foreign countries to this. Uranko and Arono're in the space,
but Centrist is an American company doing this. So that
is the fuel end of that. But right now, to
(30:33):
get one built, we need to use in my view,
existing fuel supply l EU that they're using in the
big plants and designs at work. So Tennessee will lead
in this regard. Utah will also be leading, and our
friends in Idaho, I can't leave them out well.
Speaker 7 (30:48):
On the subject of Tennessee, knowing that, of course you're
fresh off of the effort to pass the One Big
Beautiful Bill, what impact are you expecting in Tennessee of
the changes that were made in that bill to the
way in which which Medicaid benefits can be access accessed
and distributed. Who qualifies for them? What are you preparing
your constituents for.
Speaker 6 (31:08):
It's another great question. I just returned from home. I
flew up this morning from Chattanooga, so I've been here
in Chattanooga the past few days. I came up to
have dinner with their great speaker, Mike Johnson tonight. Most
of my constituents, not all everywhere I went in rural America,
very very strong for the big, beautiful bill, no question
about that. In Oakridge, I went up there the same situation.
(31:32):
The few Democrats I ran into candidly, and my district
is Ruby red. But I represent all my constituents and
I'm very cognizant of that, just as I tell friends
of mine who are Republicans in Massachusetts and blue states,
their voice needs to be heard too. We're all Americans.
The Democrats in the district are living. They do not
(31:52):
like this bill. The Republicans and Independence I spoke with,
very very positive about that. Why number one, and we
raised the debt limit that does not get talked about much.
We raised it by five trillion dollars. Why is that important?
We were on the verge of a default. And give
President Trump good credit when he was talking to the
members about why we needed to pass this thing. That
(32:14):
was the sleeper that most people don't want to lead with.
That's not your best card that you want to play
with the American people, especially in our party. I mean,
those are the strongest calls I'll get at our office
when on the precipice of a raising the national debt,
but they said no, no, no, don't do it. Don't
do it. We can never go into default. So that
was done. The tax situation is something that's going to
(32:37):
impact most people. No tax on tips. I eat out
a lot. The servers are happy, but overwhelmingly where I live,
it's not a hard sell. In Bluer States, it's going
to be a hard seller and no sale.
Speaker 3 (32:50):
Congressman, it's great to see you.
Speaker 2 (32:51):
Tell the Speaker, we'd love for him to join our
conversation next time we've come.
Speaker 3 (32:54):
To see us.
Speaker 2 (32:55):
Yes, sir, I should let everyone know, well, we like
visiting with you. You're writing books now. This is a novel,
Once Upon an Empire by Chuck Fleischman Kayley. The review
on the cover is from Kevin McCarthy, a former Speakers
of the House of Representator, and he congrats on the
new book. And I got a wonderful letter from Donald Trump.
(33:15):
He read it and liked it. It's political fiction.
Speaker 6 (33:18):
I promise all my works or works of fiction.
Speaker 3 (33:21):
Yeah, so it's.
Speaker 6 (33:22):
Time to make America think again.
Speaker 2 (33:23):
We're gonna stick with the facts here for now.
Speaker 3 (33:25):
Congressmen. Great to see.
Speaker 1 (33:26):
You're listening to the Bloomberg Balance of Power podcast. Catch
us live weekdays at noon and five pm e Stern
on Apple Cocklay and Android Auto with the Bloomberg Business app.
You can also listen live on Amazon Alexa from our
flagship New York station. Just say Alexa play Bloomberg eleven thirty.
Speaker 2 (33:45):
As we add the voice of Senator shall Eat Moore Capito,
another Republican member here with the idea of recisions coming
up very quickly here from West Virginia. Senator, it's great
to see you back on Bloomberg TV and radio. We
were just discussing this nine billion plus dollar decisions package.
Speaker 6 (34:02):
Will it pass well?
Speaker 10 (34:05):
I think we're going to be considering it next week.
We are now looking at the details of the recision package.
It's a nine billion dollar package, mostly USAID but also
Corporation for Public Broadcasting, and we have some we may
make some adjustments there in terms of where we think
this may be may have gone too far in some cases,
and so we're in the process of that right now.
Speaker 7 (34:28):
Well and well, the end result of that process, Senator,
risk being that Democrats do not find themselves ultra willing
for a bipartisan compromise on appropriations on keeping the government
funded beyond September thirtieth, because they know there's always a
risk that funding gets rescinded.
Speaker 10 (34:45):
Well, I think that the Democrats are certainly making that argument.
I think basically the overwhelmingly, the overwhelming opinion across the country,
and what President Trump campaigned on is that the usaid money,
much of it and this is not cutting all of it,
of course, but much of it is used for ways
that are really not benefiting global health and others that
(35:05):
it's advertised for. And also the fact that the Corporation
for Public Broadcasting, particularly on the NPR side, has for
years been very much a left leaning organization, and why
are we using our taxpayer dollars for this? So these
are pretty well defined areas that the President talked about,
So the Democrats shouldn't be surprised by this. We are
(35:28):
in appropriations. I just came from my appropriations meeting. It
could be a rocky road here, but we did pass
two bills out of committee, so there's a plus.
Speaker 3 (35:36):
We would love to hear a little bit more about that.
Speaker 2 (35:38):
But I'd also like to ask you first about the
President's Big beautiful bill. Senator, I saw some local reporting
from West Virginia that you were met by a small
band of protesters at not a town hall, but a
ribbon cutting event in Fayetteville, in your home state. Do
you have any buyer's remorse for this bill concerns about
changes to medicator will you?
Speaker 3 (36:00):
Can you tell us that these.
Speaker 2 (36:00):
Were democratic activists and this is the cost of doing business.
Speaker 9 (36:04):
Well, you know what. I stopped and talked.
Speaker 10 (36:06):
We talked to ten fifteen minutes before the event that
was opening up a really beautiful bike trail in Fayetteville,
West Virginia, so I'd invite visitors to visit it, and
I tried to talk about the facts of the bill.
The facts of the bill is every West Virginia taxpayer
will not see their taxes go up. Their taxes will
actually go down because we increase the standard deduction. We
(36:27):
also provide seniors with a tax break of those that
are relying on Social Security, no taxes on tips, no
taxes on overtime.
Speaker 9 (36:35):
So this isn't important for West Virginia.
Speaker 10 (36:37):
Their main focus was, as you would expect, medicaid and
basically what I tried to tell them and what I believe,
and why I do not have buyer's remorse is that
I believe in order to preserve Medicaid for future generations,
we've got to get people off of it that don't
deserve to be there. That we have to bend the
curve and spending, and we will be spending two hundred
billion over ten years, just not a trillion, and I
(36:58):
really think a body people being able to work some
for their benefits.
Speaker 9 (37:03):
In my view, these are not unreasonable asks.
Speaker 10 (37:06):
And the thing I'm concerned about is are these programs
going to be there in ten twenty years and at
the rate of growth the answers know, so we need
to make sure that this is going to the people
that it's intended for and serve their health needs the best.
The Rural Stabilization Fund is big in my state because
obviously we're very rural in West Virginia, and I think
this will help our hospitals that have issues are going
(37:29):
to have some issues with affordability well.
Speaker 7 (37:32):
And that Stabilization Fund, to the tune, of course, of
fifty billion dollars, do you expect Senator that to be adequate?
Not knowing it's not just West Virginia that is going
to need the assistance, but states across the country or
could their need be a need that arises for further
subsidies for those hospitals.
Speaker 10 (37:48):
Well, I think we need to keep in mind too
that the changes were made on the provider tax and
other things on Medicaid don't go into effect for three years,
so we've got time to adjust here. If in fact
what you're saying is true, I think what we're going
to see is our rural hospitals stronger because they're going
to run more efficiently. There's going to be ways through
(38:09):
CMS and others to make sure that it systems and
everything are better coordinated.
Speaker 9 (38:14):
I have confidence that.
Speaker 10 (38:15):
Rural health care and rural health care delivery is very difficult,
and we've got to preserve every avenue, and that means
preserving all the rural hospitals in my state and across
the country.
Speaker 2 (38:25):
We talked a lot of senator about the cuts to
subsidies for clean energy. We were just discussing wind and
solar with Congressman Chuck Fleischman. What does that mean for
West Virginia and will it create a demand for more coal?
Speaker 10 (38:40):
Well, I think what it does is evens the playing
field for every resource or every source of energy supply.
It also I think boosts nuclear energy. We have all
this energy demand through AI and data centers. We can't
meet the demand, so we need baseload energy, which wind
and solar.
Speaker 9 (38:58):
Do not provide. It's euphemeral.
Speaker 10 (39:01):
Sometimes it works, sometimes it doesn't. We need that base load.
So that's natural gas, coal, nuclear, and there's a hydrogen
piece in there that's particularly of interest to me. I
asked to move the deadline out just a little bit
to see if we can jumpstart a lot of these projects,
and I was successful with that. So I think it
really just evens the playing field for all energy, all
(39:22):
types of energy, and I think it'll be good for
my state because we're an energy state.
Speaker 7 (39:28):
Senator, I'd like to go back to the subject of
appropriations in your seat on the committee, Senator rather Congressman.
Fleischman also just told us that he's expecting a short
term continuing resolution is likely going to be required to
keep the government funded beyond the end of the fiscal year.
Is that also your expectation.
Speaker 10 (39:46):
Well, I mean, we wouldn't have to make that decision
until the end of September. The Leader Leader throone has
said with our chair Chair Collins and Vice Chair Murray
that we want to.
Speaker 9 (39:57):
Have these bills up on the floor. Let's give that
a chance to work. I mean, we're running out of time.
Speaker 10 (40:02):
We only have seven weeks, but we do have seven weeks,
so hopefully we can have some successes there.
Speaker 9 (40:06):
Before I make the declaration.
Speaker 10 (40:08):
That we have to have a continuing resolution, I'd rather
see us keep this process moving as much as we can.
Speaker 7 (40:15):
All right, Senator, we appreciate your time joining us live
from Capitol Hill. Republican Senator Shelley Moore, Capital of West
Virginia here with us on Bloomberg TV and Radio. Thank
you so much, and we want to continue the conversation
now as we turn here to our political panel. Mrick
Davis is with us Bloomberg Politics contributor, Republican strategist and
Stone Court Capital partner, alongside Archie Sadiki, former senior aide
(40:36):
to former Speaker of the House Nancy Pelosi, now founder
and CEO of Bellweather Government Affairs. Welcome to you both.
R She to begin with you, we were just speaking
with both the Senator and the Congressman about this notion
that Democrats may not have much incentive to make a
spending deal with Republicans that are pursuing at the same
time recisions of previously appropriated spending by Congress. We know
(40:58):
Nancy Pelosi wasn't afraid to hold a firm line on
spending oriented deals and shutdowns when she needed to. What
do you expect to happen here as we approach the
end of the fiscal year?
Speaker 11 (41:09):
I think your question was spot on because the recisions
discussion is going to be critical in terms of paving
the future in terms of not only the continuing resolution, appropriations, etc.
And as you know, in the Senate has traditionally been
very bipartisan, and this recisions bill, they're talking about changes,
and the question is are they bringing in Democrats? Are
they because you know, to your point, if you can't
(41:31):
rely on a deal that's made, and we've already seen
Republicans go back on these types of deals. So I think,
particularly after this past reconciliation bill, I think it's going
to set the tone for the rest of the year.
Speaker 2 (41:42):
Rick, would it be who for Republicans to step away
from the recisions plan in hopes of actually clearing a
budget before the end of the fiscal year.
Speaker 12 (41:51):
I'd love to tell you that I'm enthusiastic that we
could get the regular order in a past twelve appropriations
bills before the end of September given up. You know,
Mark this da Davis doesn't think the sel so so
so look, I think that the Senate may creator the
(42:13):
recisions package on its own right. There are lots of
Senators concerned about pepfar getting stricken and rural radio, as
you mentioned in your last interview, has become a real
big issue for people like Center Rounds and Senator Sullivan,
so that may die on its own court. That being said,
whether or not the Senate can actually produce appropriation pills
(42:34):
on time, my guess is soon has a plan to.
Speaker 6 (42:37):
Do a continuing resolution.
Speaker 12 (42:40):
He will continue the public attitude that we want to
do our business. But of course there's never been anybody
fired from a chairmanship because they didn't get the appropriations done.
So at the end of the day, count me as skeptical.
Speaker 7 (42:55):
Well, when we consider what the Senate majority leader might
have its his sleeve, it's also a question of the
Minority leader of Hockey Jeffreys in the House. How should
we be thinking about the democratic calculus here? As to
whether or not they want to play hardball on this
issue risk a shutdown, how that plays for them politically.
I just wonder what kind of leverage they're really working with.
Speaker 11 (43:16):
I mean, traditionally, Democrats have always put government first in
terms of that continuity. So I think we have seen
that quite a bit. But I do think that there
is a tried and true blueprint of bipartisan by cameral
negotiations on these packages. I mean, time and time again,
I think we're in an aberration in terms of moving
away from that in this past negotiation. And you know,
(43:39):
the Reconciliation Bill, when you have one party control, that
is usually given that. You know when you have the House,
White House, and Senate. But on the appropriations packages and
you're in packages, those have generally been bipartisan, and that's
a give and take. So I think that's both sides.
I mean, so far the Republicans have not been willing
to do that give and take. But I do think
that Democrats are going to drive a hard bargain and
(44:03):
but again I think the recisions package will pay that way.
Speaker 2 (44:06):
Hakim Jeffries has a very different style than Nancy Pelosi do.
What would your former boss have been doing right now,
because I feel like she would have been screaming from
the rooftops about this. Hakim Jeffries has a much more,
much more subtle approach. How loud does he need to
get about recisions?
Speaker 11 (44:22):
So I think Hakiem Jeffries needs to be hackem Jeffries. Yeah, absolutely.
I mean we're in a different era, there's generational shift.
I talked to a lot of members of Congress there
there there there's a lot of support for Jeffries. He's
very thoughtful, he's very smart. He really does try to
put country first. So I think it's a different style.
(44:44):
So I don't think we should that that shouldn't be
the template. He's also can be very tough. I mean
he's a tough politician. He comes from New York.
Speaker 2 (44:50):
I'm not questioning that. But sometimes you need to put
this on front street so people know about it.
Speaker 11 (44:53):
Absolutely and you you saw him on the floor. I
think that was a shining moment for Jeffries, right like
the leader was on the floor or eight plus hours
he broke the record. So I think from that perspective,
I think Democrats are very united against this bill because
it really represents it's not the usual tax bill that
we've seen in the past. It's an ideological bill in
many respects. So I think that's going to serve as
(45:15):
the blueprint for Jeffreys going forward.
Speaker 7 (45:18):
Well, Democrats may not like the bill, but it's the
bill that the President wanted, Rick, and it's the bill
the President ultimately got. To the point you were making
a few minutes ago about you think the Senate might
ultimately and this recision's effort all on its own, How
is that going to sit with Donald Trump?
Speaker 9 (45:33):
Do you expect?
Speaker 12 (45:34):
Well, you know, it was interesting when a bill was
first submitted, there wasn't really a strong commitment by the
White House. They said things like, well, you know, we've
got more we can send if this one goes through,
you know, kind of raising a question like how committed
are you to really drive this through? And so, you know,
I think this is actually, you know, sort of ball
in the Senate court. It's really up to them to
(45:57):
decide whether that they want to see another one hundred
billion dollars in recisions coming from the White House, because
if this doesn't pass, it's highly likely to raise questions
inside the White House whether this is a good commitment
of their time and effort. You know, with Congress, they've
got a lot of agenda items that they need to
get through Congress, and recision packages have historically never fared well.
(46:21):
And in this case, especially when you think you have
a backlog of hundreds of billions of dollars with more
recisions to come, you know, does Congress really want to
get in that business? I mean, these are very difficult
votes for some of these members, and you know how
many times you're going to ask them to walk the plank?
Speaker 3 (46:39):
Just have thirty seconds? Are she? If this doesn't pass?
Is this the last vestige of the Doge?
Speaker 9 (46:44):
Well?
Speaker 11 (46:44):
I think what's interesting about the doge is that there's
supposed to be two trillion dollars in cuts, and as
we know, this recision bill is nine billion dollars in change.
Speaker 9 (46:52):
So I think that speaks for a lot, a bit of.
Speaker 2 (46:55):
A delta there, Yeah, a little different, Yes, indeed, are she?
Thanks for joining our panel. We'd love to have you
back soon as we can. Archie Sidiki and Rick Davis
with a smart conversation you'll only hear on Balance of Power.
Thanks for listening to the Balance of Power podcast. Make
sure to subscribe if you haven't already, at Apple, Spotify,
(47:17):
or wherever you get your podcasts, and you can find
us live every weekday from Washington, DC at noontime Eastern
at Bloomberg dot com
Bloomberg Audio Studios, podcasts, radio news. You're listening to the
Bloomberg Balance of Power podcast. Catch us live weekdays at
noon and five pm Eastern on Almalcarckley and Android Auto
with the Bloomberg Business App. Listen on demand wherever you
(00:20):
get your podcasts, or watch us live on YouTube.
Speaker 2 (00:25):
Welcome to the Little Friday Edition. Yeah, Thursday is here
on Bloomberg Radio Satellite radio channel one twenty one.
Speaker 3 (00:32):
We're always on Bloomberg Originals.
Speaker 2 (00:33):
Now and of course on YouTube search Bloomberg Business News
Live if you want to join us here in the studio.
There's nothing on the president's schedule today. He's got a
quiet Little Friday at least so far. We know that
can change, and we've got our eyes on truth social
because well more letters could be going out this What
is this day after what was deadline day? Yeah, it's
(00:54):
the tenth of July and we've got a new deadline,
as we've discussed when it comes to trade August one.
A whole bunch of letters dropped yesterday. And it's interesting
the way this all works because we keep seeing the
form letters. You know, they just change the number, change
the name at the top. Maybe the number in the copy,
but the one that went to Brazil certainly got some
(01:17):
attention yesterday as the President not only slaps a fifty
percent tariff on goods coming in from Brazil, but goes
on a long missive and it's not just truth social
it's actually in the letter about former President Balsonaro, the
censorship of American social media and so forth, making many
wonder exactly what is driving the trade policy in this
(01:38):
White House? Is this getting a little personal. Mike Pence
talked about it today, the trade policy that is you
see Mike Pence on Bloomberg Surveillance. The former Vice President,
of course, has been making the media arounds, has a
lot of nice things to say, most recently about this
second Trump administration when it comes to the big beautiful bill,
when it comes to strikes against Iran, not so much tariffs.
(02:00):
Here's Mike Pence from this morning.
Speaker 4 (02:02):
What we saw several months ago and now it's paused again, happily,
is the kind of broad based industrial policy that I
think ultimately will harm the American economy. What I like
to say is free trade with free nations. Be tough
on China, be tough on trade abusers, but have the
objective of ultimately lowering trade barriers, and that's how America
(02:25):
wins and prospers.
Speaker 3 (02:27):
Free to be you and me.
Speaker 2 (02:29):
The old Republican is coming out of the former governor
of Indiana, longtime Congressman Mike Pence. Interesting reflecting with the
old line and the Republican Party, which of course had
an allergy to tariffs. Then again, Mike Pence seems to
think tariff's worked all right the way they did it
surgically speaking strategically in the first administration. This across the
(02:49):
board throwing of darts and now adding personal affections to
tariff decisions is making everybody wonder and it certainly is
making Wall Street skip a little bit of beat today.
You heard from Charlie Pellow. This isn't a massive sell
off here, but maybe a little pause in the rally now.
We want to get to all of this and what
this means for what will be our future trade relations
(03:12):
with countries around the world by the first of August.
Not to mention what's happening elsewhere when it comes to
foreign policy. In this White House with a great voice
of experience working out of the newsroom here in Washington, DC,
that's Jenny Welch, Bloomberg Economics chief geoeconomics analyst, a veteran
of the Biden White House, and Jenny gets great to
have you with us here, as always on balance of
(03:32):
power here on Bloomberg. What do you make specifically of
the Brazil letter, the fact that he's calling out a
former president who's facing charges over an attempted coup. This
is giving the market some agity here to think that
Donald Trump is capable maybe of more than some thought
when it comes to throwing tariffs around. Jenny, how do
(03:52):
you see it?
Speaker 5 (03:54):
Thanks, Jera. Well, as you noted, this letter stands out
from the others and that he's taking aim at Brazil
over polluted issues. Certainly, we've seen the Trump administration criticize
other countries for their handling of political leaders who share
some of the same politics as President Trump, but this
is the first time he's used the cudgel of tariffs
to sort of reinforce those threats or that's criticism. I
(04:15):
also suspect this isn't just about former President Volsnaro, but
might reflect on Trump's criticism of the Bricks, which held
their summit over the weekend. Afterwards, he saw him lobb
threats at the Bricks and partners associated with it over
what he characterized as anti American policies. Well, Brazil was
a host country for the Bricks and is largely supportive
(04:36):
of some of those policies that I think President Trump
criticized as being anti American. I think a lot remains
to be seen in how this few plays out. Obviously,
Brazil's initial response is relatively muscular assertives, saying we're going
to defend ourselves and retaliate privately. It's very likely they're
going to try and approach the administration negotiate. But what's
also different about Trump's letter to the President of Brazil
(04:59):
is that he did really offer an off ramp, and
the same way all the other form letters do, noting
the potential for negotiations. In that August first deadline, he
seems to be laying it down as though this is
what's going to.
Speaker 6 (05:11):
Happen, Jenny.
Speaker 2 (05:13):
He also talked about the Brazilian Supreme Court's hundreds This
is a direct quote, hundreds of secret and unlawful censorship
orders to US social media platforms in his letter to
President Lula DeSilva.
Speaker 3 (05:27):
What's he talking about?
Speaker 2 (05:28):
Here, and is this we've ever seen a crossover of
personal attitude toward politics with trade policy like this.
Speaker 5 (05:38):
I think what he might be referring to in part
is if you remember some of the view that happened
between Elon musk X in Brazil in the past. Now
that dispute was worked out separately, that could be part
of what Trump is referring to here. Was obviously something
that at the time he was paying pretty close attention to,
and in terms of the use of tariffs and sort
(05:59):
of advance, what you might frame here is more a
personal political issue. This is relatively unique. Obviously, we've seen
him use tariffs towards other non trade related policy concerns,
for example, the fentanyl related tariffs geared towards China, concerns
about the euse regulatory issues, leveraging teriffs, in his words,
(06:21):
to try and bring about peace between India Pakistan. Of course,
they would dispute that trade was part of those conversations.
But all that is to say Trump very clearly sees
terriffs as a tool that he can use to achieve
many different ends beyond the trade realm. However, this is
a unique case where he seems to be leveraging it
to try and influence domestic politics or what is seen
(06:43):
within Brazil as a domestic political issue.
Speaker 2 (06:46):
Well, we did hear back from little of de Silva
pretty quickly, actually, the response for the leader of Brazil
saying that his nation will not be tutored the word
he used by anyone, and that unilateral rate hikes will
be respons bonded to using Brazil's economic reciprocity laws. So
this has going pretty well so far. As we spend
time with Jenny Welch, I want to ask you about Ukraine. Jenny,
(07:09):
there is reporting today that weapons shipments from the US
have in fact resumed to Ukraine, and the news that's
coming out of Ukraine has been horrifying, hit with a
deadly attack once again. As Allies gather in Rome to
talk about post war revival, I don't know how we
can even advance the conversation to post war when we
(07:30):
can't get Vladimir Putin to stop bombing civilians. Jenny, what's
going to happen here when the United States runs out
of weapons that we can continue to draw down from
the Biden administration by the end of the summer, They're
going to need a new request, aren't they Yeah.
Speaker 5 (07:44):
I think one of the challenges here is, as you noted,
there's one set of authorities that the Biden administration use
called Presidential draw Down Authority, that allowed US to essentially
ship Ukraine weapons right out of US stocks. That authority
has been largely used up. US stocks to some in
the Pentagon are also severely depleted. And the challenge with
(08:04):
that is that was the authority that allowed us to
get stuck to Ukraine very quickly. There are other authorities
that allow us to, for example, manufacture new weapons for Ukraine,
and in fact, a lot of usaid to Ukraine was
in that form, allowing them to purchase US weapons or
for other partners to purchase US weapons on behalf of Ukraine.
But manufacturing those weapons takes a significant amount of time.
(08:26):
There is a backlog in many US customers who are
waiting for some of the same systems that Ukraine is
hoping to procure. This is the challenge that we've been
facing for months to a year now. Europeans are trying
to step up and fill in the gaps in US assistants,
but one of the key gaps that remains is on
air defense and specifically the capability that US patriot defense
(08:47):
batteries provide. That's one that's going to be really hard
to find an alternative to, and that's one that can
really make a huge difference in terms of defending, in
particular Ukrainian population centers and cities from Russian attacks.
Speaker 2 (09:00):
Well, Marco Rubio, the Secretary of State, met today with
Sergei Lavrov's Russian counterpart. They met along the sidelines of
the Assian Foreign ministers meeting in Malaysia. Not great when
you consider what he said coming out of this, Jenny,
it was a frank conversation, it was an important one.
It apparently did not advance the march to peace at all.
(09:20):
We only have about thirty seconds. Is this administration helpless
from a diplomatic standpoint right now?
Speaker 5 (09:26):
I think the administration has a lot of options at
their disposal. The key question is whether they want to
use them, and sations being the key option that we
haven't yet seen them willing to deploy in a stronger
form against Russia.
Speaker 3 (09:37):
I'm really glad you mentioned that, Jenny.
Speaker 2 (09:39):
We're going to talk later on this hour with our
political panel about the advancement of a sanctions bill in
the US Senate written up by Lindsay Graham. John Thune
says this could in fact head to the floor sooner.
It looks like the President is about to lean into this.
Jenny Welch, thank you so much. As always with Bloomberg Economics,
our geoeconomics analyst.
Speaker 1 (09:56):
Here, you're listening to the Bloomberg Balance of Power podcast
ketchs live weekdays at noon and five pm. He's durn
on Apple, Cockley and Android Auto with the blue Berg
Business App. You can also listen live on Amazon Alexa
from our flagship New York station Just Say Alexa played
Bloomberg eleven thirty.
Speaker 7 (10:16):
Don Kaylee lines alongside Joe Matthew here in Washington, where
we of course are keeping track of domestic developments and
changes on that front, but changes in geopolitics as well,
or at least changes in attitude it seems on the
part of President Donald Trump when it comes to the
ongoing war between Russia and Ukraine, of course, remembering he
promised to end the war on day one of his presidency.
(10:37):
Here we are in July with still no ceasefire agreement
having been made, though his administration has been pushing for one,
and he's expressed increasing frustration with the Russian President Vladimir
Putin in that regard, so much so, in fact, that
he actually reversed a decision made by his own Department
of Defense, which was, of course a pause of weapons
(10:58):
defensive webs in particular to Ukraine. That flow is now
resuming on the President's orders, and it's something that the
former number two to President Trump, at least during his
first administration, former Vice President Mike Pence, is pretty happy about.
He spoke earlier on Bloomberg Surveillance.
Speaker 4 (11:15):
I was pleased that the President countermanded what had been
a pause of aid to Ukraine last week, which I
think was unfortunate wherever it originated. I command the President
for reversing that decision. And my hope is when the
Senate reconvenes that Senator Thunal will put the Graham Bill
(11:40):
on the floor and put it on the President's desk.
Speaker 6 (11:43):
I think it's time.
Speaker 2 (11:45):
Counter Mandate is an interesting word that Mike Pence uses there,
and we want to bring this to an expert, A
voice of experience. David Scheimer spent time as the director
of the National Security Council's Eastern Europe in Ukraine, Peace
director for Russian Affairs.
Speaker 3 (12:01):
And the Biden White House.
Speaker 2 (12:02):
He's now senior research scholar at Columbia University's School of
International and Public Affairs, joining us.
Speaker 3 (12:09):
From World Headquarters in New York.
Speaker 2 (12:10):
David, it's great to have you on Bloomberg TV and
Radio bring us inside the bubble for this. Have you
ever heard of an instance quite like this where the
civilian leadership of the Pentagon acted without the approval of
the commander in chief.
Speaker 8 (12:25):
Great to be here. It's hard for me to comment
from the outside on the precise decision making that's occurring
on the inside, but what I can say is that
when I was serving at the National Security Council, there
was a robust interagency process where on a daily basis,
decisions were being made on support for Ukraine at meetings
(12:46):
that were chaired by the White House, with participation from
the Department of Defense, from State, from the intelligence community,
and from others, such that coordination would take place and
folks being overruled after the fact wouldn't actually have to occur.
Whether that process this is still taking place, I think
is in some doubt given the tell mote and changeover
at the National Security Council, and elsewhere. And I do
(13:07):
think that this is a reminder as to the value
of having a robust, rigorous government decision making process around
issues as serious as these.
Speaker 7 (13:16):
Well, So, putting aside how exactly the initial decision was made,
let's focus on the President's decision to reverse the initial
decision to resume the flow of aid to Ukraine, knowing
that there was a time at which we thought that
Ukraine did not necessarily have the explicit support of this
particular president. What does it signal to you, David, that
(13:36):
this reversal happened, What it means for the way in
which the President may be looking at the conflict between
Ukraine and Russia now versus before.
Speaker 8 (13:44):
So I think it's certainly a good step to reverse
whatever pause or decision had been made to halt aid
to Ukraine, because Ukraine needs the support and it's in
US interest to provide Ukraine with the support. However, I
also want to make clear that what was pause that
has now been unpaused is aid that was authorized during
the Biden administration, during the administration in which I was
(14:06):
a part, and that was a drawdown package of one
point twenty five billion dollars authorized in December of last
year that has lasted up until this summer, as well
as what's called USAI deliveries that are similarly contracted for
last year, and the problem is that those deliveries are
running out. And so even though the pause has been lifted,
which again is a good step, what matters far more
(14:28):
is whether this administration will go further and authorize additional
new support for Ukraine which will provide continued flows over
time and enable Ukraine to continue to defend itself over time.
And I very much believe that they should do that.
Speaker 2 (14:42):
Well, that's a great point that you make here. So
we're set to go through the end of summer, which
is in about five minutes. You've actually gone through this process.
Would the administration not have to submit an emergency supplemental
request now to prevent a gap in weapons shipments?
Speaker 3 (14:58):
And what would you be asking for?
Speaker 2 (15:00):
These be defensive systems like patriots or offensive ballistic missiles.
Speaker 8 (15:05):
So as a side point, I struggle with the distinction
in this context between defensive and offensive systems because Ukraine
is defending itself and Ukraine is now being provided with
artillery and rockets to defend itself. That has been unpaused,
and so I don't find that distinction especially useful. But
taking a step back from that, I would also say
that there is approximately three point eight billion dollars in
(15:28):
draw down authority that still remains available to the President
of the United States to use without having to go
to Congress, and so tomorrow this administration could decide to
draw down additional weapons from US stockpiles for Ukraine without
additional funding or authorization from the Congress's point one point
two is that the Europeans and the Ukrainians have set
explicitly that they want to buy weapons from the United
(15:50):
States to give to Ukraine, and so not only would
we be furthering our support for Ukraine, there would also
be additional generated revenue and trade inflows into the United States.
That is another available option to the United States to
get weapons to Ukraine. And so there are options to
maintain our support beyond what was authorized in December. The
question is whether those options will actually be executed upon.
Speaker 9 (16:13):
Well.
Speaker 7 (16:13):
And when we consider the options that the administration has
to exercise leverage or to try to influence the behavior
of Russia specifically, I wonder what you make, David, of
the sanctions package that it seems there is building momentum
toward at least in the United States Senate and possibly
with the White House as well. What would this particular
package of sanctions do that all of the other previous
(16:36):
sanctions package, including the ones that of course were pursued
by the Biden administration, due to alter the behavior of
Vladimir Putin when he is still engaged in this war
consistently throughout all of those sanctions being implemented.
Speaker 8 (16:48):
So absolutely, I think if we just take a step
back here, the reason that Ukraine has agreed to a
cease fire but Russia has not is because Russia and
President putn't believe that time is on his side. Seize
US support is declining. He believes that the longer this
war goes on, the more likely it is that his
battlefield position will improve compared to Ukraine's. And so the
objective in order to get to a ceasefire should be
(17:11):
to affect Puden's calculus and make him believe the time
is not on his side. And how do you do
that A you continue and even surge weapons flows as
we just discussed. B To your point, I believe that
sanctions against Russia's energy sector should be intensified, built upon
sanctions that have already been implemented, in order to increase
the pressure on the Russian economy and make it more
(17:31):
challenging for Russia to sustain its war of aggression. Third,
something that we haven't yet discussed is I believe that
the Europeans should move towards seizing the approximately three hundred
billion dollars in Russian sovereign assets that are immobilized in
its jurisdictions in order to provide Ukraine with a long
term source of support, both to help Ukraine but also
(17:52):
to send a message to Russia that aid for Ukraine
will not dry up with time. If you do those
three things, surge weapons, deliveries, intense I sanctions, and acquire
a long term source of assistance through the sovereign assets.
That recipe could be enough to adjust Pudent's thinking and
to put him push him to the table in a
meaningful way.
Speaker 7 (18:12):
All right, David, great to have you here on Balance
of Power. David Scheimer, former Director for Russia at the
National Security Council in addition to former Director for Eastern
Europe and Ukraine at the National Security Council.
Speaker 1 (18:21):
Plus, you're listening to the Bloomberg Balance of Power podcast
ketts live weekdays at noon and five pm. E's den
on Alma Cockley and Android Auto with the Bloomberg Business App.
Listen on demand wherever you get your podcasts, or watch
us live on YouTube.
Speaker 7 (18:39):
In our Washington, d C. Studio. Someone who is intimately
familiar with this process as well, sitting on the Appropriations
Committee in the House, Congressman Chuck Fleischman is joining US
Republican representing Tennessee's third district. Congressman, Welcome back to Balance
of Power. Always great to have you, and nice to
see you in studio. Because you're here in studio, I
could see you nodding along when Eric was suggesting it's
going to be really hard to meet that September thirtieth deadline.
(19:02):
You're betting on a continuing resolution.
Speaker 6 (19:04):
Well, I'm an optimist. I'm always betting on a budget.
But probably if you look at where things are, we
never want to see a government shutdown. I've lived through three.
It's not good, it costs more to reopen, and it
just really is disadvantageous for the entire nation, including markets
and the like. But what do I think will happen.
I'm actually riding the Energy and Water bill for appropriations.
(19:26):
We're going to mark that up next week in full committee.
But the reality is, you look at the clock and
things like that, probably a short term cr He's right,
we do not want a government shutdown. But the key
thing to remember, and I try to tell my friends
in my party this, it's going to take sixty votes
in the Senate to get an appropriations package, unlike reconciliation.
Speaker 2 (19:48):
So will Republicans have a posture that involves Democrats in
this process? What are you hearing from your colleagues across
the aisle.
Speaker 6 (19:56):
That's an interesting question. Right now, we're not receiving any
help from Democrats. I can tell you with pretty certainty
that my bill will pass out of my committee next
week with all Republican votes. Now, when we go to
the floor, that may be a different story. We have
obviously three wonderful factions in our party. Our moderates are
(20:16):
center right. I'm in the center right, and then are
folks who are further to the right. So we've got
to make sure that we hold our Republican votes together.
But every once in a while, when we see increases,
for example in the Office of Science, which I'm going
to put forth in nuclear energy. And I'm getting tremendous
bipartisan and bicameral support. Young progressivests who agree with me
(20:37):
on nothing come to me and support me on new
nuclear So we've got some things in some of these
bills that are going to be attractive. I just don't
know whether or not their leadership team in the House
and in the Senate will allow them to do that.
But the country does not want another continuing resolution. I
don't think we've ever had two in a row. They're
never good. They're preferable to a government shutdown, but they're
(20:58):
never good.
Speaker 7 (20:59):
We need a budget well, and so if getting Democrats
on board with the budget is required. Here to your
point on needing sixty votes in the Senate, do you
see the recisions package currently being considered by the Senate
as posing a danger to that bipartisan effort.
Speaker 6 (21:13):
There's no question that it's less palatable to our friends
in the Senate, both Republican and I think democratic over there,
largely Democrats. It will have a much easier time in
the House. Remember, the recision is rescinding taking back money
that's already been.
Speaker 7 (21:27):
Appropriated which is why Democrats are saying, why would we
make an appropriations deal with you if you can recancele it?
Speaker 6 (21:32):
Indeed, but going forward, and again the eternal optimist in
me says, let's look forward. Let's get our budget done.
The Energy and Water bill that I've written this year
for the House is as strong as it was in
twenty four. We passed it. It was great for energy,
especially in new nuclear. Twenty five we didn't get there.
Why because of the continuing resolution. So the reality is
(21:54):
you get out there, you put your best work product forward.
The other Cardinals, subcommittee chairs on approbe creations, Republicans have
written very good bills. We've passed some. Some are going
to be very difficult to pass.
Speaker 2 (22:06):
What do you think about the Mic Rounds of the
world who worry about eliminating funding for NPR And I
ask you this because you know, I believe it was
Bill Cassidy said last evening, a Senator from Louisiana got
to cut the funding because it's a partisan operation. But
there are some lawmakers like Senator Rounds to say this
is a lifeline for people in rural areas. You might
not like what's on the NPR network, but these local
(22:27):
newsrooms are delivering critical emergency information.
Speaker 6 (22:30):
Does he have a point, Well, he has a vote.
I don't know if he has a point, but he
has a vote. And I have heard that rhetoric coming
from some of my Republican colleagues, and prior to this discourse,
I never did understand or know that that dynamic was
out there. They feel that that is a lifeline to
many years in rural America. So if a senator particularly
(22:52):
feels that strongly about it, it is going to have
to be addressed. Again, there's not always an equal weight
between the House and the Senate. One senator can really
derail or stop a process, so we have to listen
to that. However, we need to see strong reforms. I
think at MPR there are things that are done there
(23:13):
that really need to be addressed. I would like to
see more of a political balance like we do on
your great show. We've got to listen to both sides
and let the American people then make their decisions. But
I come from the right. Either just come from the
left or the center. But the reality is we need balance.
Speaker 7 (23:31):
Well, as Joe makes the point about the role of
public notification, especially in these rural areas. That brings me
to a question around emergency response given what we've just
seen play out in Texas, but frankly is still unfolding
before our eyes with so many people remaining missing in
Hill Country. Tennessee is obviously no stranger to natural disasters either,
And I'm wondering if you're learning lessons about the way
(23:52):
in which information was distributed, if it's too early to
have those conversations as the still as an active rescue
effort and the station around reforms to FEMA as well
as this teaching us that you still need to have
the federal response able to be put into place.
Speaker 6 (24:06):
You raise an excellent point. Anytime we have a national
disaster where there's Tennessee or anywhere across the Great United States,
there's sadness, there's disaster, there's tragedy, there's sadly loss of
life and the like. After the event, we can learn
from these events sometimes how to predict these. We've seen
Doppler radars and things put in in my state over
(24:30):
the years to watch hurricanes and watch tornadoes. There's a
lot of tornadoes in Tennessee that touch down. These flooding
incidents were horrific. The one in Texas is of a
magnitude I don't think that we've seen in a long time.
It's really, really horrible. FEMA will be looked at, obviously.
I know Christinome very well, actually came into Congress with
a Secretary Nome, wonderful lady. She'll do a great job.
(24:53):
I think President Trump will do a good job. But
I think the American people want to see reform. They
want to see the these largest federal organizations, agencies that
have just really year after year just had bigger budgets,
loaded budgets and have not really spent wisely. I think
if we start to spend our money more wisely, they
(25:14):
need to be funded. I don't think you'll see FEMA
go away, but I think you're going to see a reformed,
stronger FEMA as well as other federal organizations that are
going to be more responsive to their ultimate constituents.
Speaker 2 (25:26):
Well, this event in Texas also reminds us of the
improvements needed to the grid, the electic grid that we
talked to you about a lot hard making the grid
as well. We just saw the President's big beautiful bill pass.
They were part of the celebration, of course, and we
saw watering down of incentives for solar and wind. Could
this bill do enough to secure nuclear, which is one of.
Speaker 3 (25:48):
Your most passionate issues.
Speaker 6 (25:50):
Thank you. Yes, it did a lot for nuclear. At
first we were very concerned. I was very concerned, as
was our very good Secretary of Energy, Chris Right, wonderful
man doing a good job about the nuclear tax credits.
Excuse the pun. Nuclear is hot right now. There's a
lot of private investment. Markets are moving towards investing a
(26:11):
lot of capital, and that was not the case five
or ten years ago. New nuclear is so important. Big
nuclear is important. I mean the larger nuclear power plants.
We're seeing three Mile Island reopen. We're going to see
a power plant Michigan, an older one opened. We had
Vogel in Georgia. So we're going to have small, mid
size and larger nuclear power plants. It's reliable, it's resilient.
(26:35):
But yes, the big beautiful bill was very good for nuclear.
I don't think it was as disadvantageous to some of
the things as solar as some of the people think
it will be. Solar I think is here to stay,
but it's got to find its place in the market.
Wind has problems. Wind has major, major problems, but ultimately
we're going to see natural gas come back very strong.
(26:57):
I think it's a very good bridge fuel. We're seeing TVA,
my utility building more gas as we get to nuclear.
Nuclear is incredible. But new nuclear right now is going
to take a lot of capital to build the first
of the kinds. But when you build the tenth and
the hundredths, it will drop down in costs. But the
nuclear industry in America is booming in every way well, and.
Speaker 7 (27:20):
We consider the role nuclear may have empowering artificial intelligence
and data centers going forward. To get that power to
a data center to allow the data center and the
data centers being built to allow that to happen, you
need copper for a lot of that transit. And the
President says, effective August first, there's going to be a
fifty percent tariff on copper. Do you worry about the
(27:40):
potential ramifications of that, knowing that by and large it
does not seem we have adequate supply to meet the
kind of demand that we are expected to see.
Speaker 6 (27:49):
We're going to wait and see where the President goes
with copper. But you're absolutely right, not only copper, but
there's other metals and minerals that are important for this process.
Of the reasons I support our national labs through the
Office of Science. I think have the best in the
country at Oakridge National Laboratory in oak Ridge. But the
reality is our labs are looking at ways to use
(28:12):
other products. Unfortunately, the Chinese have about a ninety percent
share of this market. They control a lot of this market.
We've allowed that to happen as we regained some of
that control with existing rare earths and things like that.
It's important, but the reality is maybe we can use
our labs to go out and find alternates that are
(28:32):
more reliable, less expensive, more resilient, and that's part of
our great national research that I don't think any other country,
even the Chinese can match.
Speaker 2 (28:41):
We actually spent some time with a young nuclear entrepreneur
who was at the White House a couple of weeks
ago to talk about the future of this technology. The
Governor of Utah joined him on the air to talk
about their project together. How quickly will we see these
small modular nuclear reactors being permanent for you? So I
realized a big nuke plant is another matter, but these
(29:02):
small modular reactors could be something that we see much sooner.
Speaker 6 (29:07):
Well. Fortunately, in the great state of Tennessee, with our
great utility, the Tennessee Valley Authority, we actually have a
permitted site at Clinch River, and that would be for
an SMR, a small modular reactor with less output. They're
smaller to build, they're easier to license. They've chosen a
g Yataci model which basically uses the existing fuel supply.
(29:29):
So when you talk to SMRs, you have to say,
what would the SMR if today look like, and then
maybe the SMR in five or ten years. The reason
for the other SMRs, we have very good designs out
there terror power x energy, but they require a higher fuel.
It's called halu, and actually, sadly Russia produces a lot
of halu. Is going to be a ban on that
(29:50):
in twenty twenty eight. But that's why I've worked so
hard in fiscal twenty twenty four to put up two
point seven billion dollars so that the United States could
then begin to have HALU and LU. Of course we
have LU as an existing fuel, but we want to
start enriching uranium domestically. Again. Think about it, We're the
(30:11):
birthplace of the Manhattan Project. We started this technology and
we've led it. Basically wither away America is coming back.
So we have American companies doing it. We're attracting other
foreign countries to this. Uranko and Arono're in the space,
but Centrist is an American company doing this. So that
is the fuel end of that. But right now, to
(30:33):
get one built, we need to use in my view,
existing fuel supply l EU that they're using in the
big plants and designs at work. So Tennessee will lead
in this regard. Utah will also be leading, and our
friends in Idaho, I can't leave them out well.
Speaker 7 (30:48):
On the subject of Tennessee, knowing that, of course you're
fresh off of the effort to pass the One Big
Beautiful Bill, what impact are you expecting in Tennessee of
the changes that were made in that bill to the
way in which which Medicaid benefits can be access accessed
and distributed. Who qualifies for them? What are you preparing
your constituents for.
Speaker 6 (31:08):
It's another great question. I just returned from home. I
flew up this morning from Chattanooga, so I've been here
in Chattanooga the past few days. I came up to
have dinner with their great speaker, Mike Johnson tonight. Most
of my constituents, not all everywhere I went in rural America,
very very strong for the big, beautiful bill, no question
about that. In Oakridge, I went up there the same situation.
(31:32):
The few Democrats I ran into candidly, and my district
is Ruby red. But I represent all my constituents and
I'm very cognizant of that, just as I tell friends
of mine who are Republicans in Massachusetts and blue states,
their voice needs to be heard too. We're all Americans.
The Democrats in the district are living. They do not
(31:52):
like this bill. The Republicans and Independence I spoke with,
very very positive about that. Why number one, and we
raised the debt limit that does not get talked about much.
We raised it by five trillion dollars. Why is that important?
We were on the verge of a default. And give
President Trump good credit when he was talking to the
members about why we needed to pass this thing. That
(32:14):
was the sleeper that most people don't want to lead with.
That's not your best card that you want to play
with the American people, especially in our party. I mean,
those are the strongest calls I'll get at our office
when on the precipice of a raising the national debt,
but they said no, no, no, don't do it. Don't
do it. We can never go into default. So that
was done. The tax situation is something that's going to
(32:37):
impact most people. No tax on tips. I eat out
a lot. The servers are happy, but overwhelmingly where I live,
it's not a hard sell. In Bluer States, it's going
to be a hard seller and no sale.
Speaker 3 (32:50):
Congressman, it's great to see you.
Speaker 2 (32:51):
Tell the Speaker, we'd love for him to join our
conversation next time we've come.
Speaker 3 (32:54):
To see us.
Speaker 2 (32:55):
Yes, sir, I should let everyone know, well, we like
visiting with you. You're writing books now. This is a novel,
Once Upon an Empire by Chuck Fleischman Kayley. The review
on the cover is from Kevin McCarthy, a former Speakers
of the House of Representator, and he congrats on the
new book. And I got a wonderful letter from Donald Trump.
(33:15):
He read it and liked it. It's political fiction.
Speaker 6 (33:18):
I promise all my works or works of fiction.
Speaker 3 (33:21):
Yeah, so it's.
Speaker 6 (33:22):
Time to make America think again.
Speaker 2 (33:23):
We're gonna stick with the facts here for now.
Speaker 3 (33:25):
Congressmen. Great to see.
Speaker 1 (33:26):
You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 2 (33:45):
As we add the voice of Senator shall Eat Moore Capito,
another Republican member here with the idea of recisions coming
up very quickly here from West Virginia. Senator, it's great
to see you back on Bloomberg TV and radio. We
were just discussing this nine billion plus dollar decisions package.
Speaker 6 (34:02):
Will it pass well?
Speaker 10 (34:05):
I think we're going to be considering it next week.
We are now looking at the details of the recision package.
It's a nine billion dollar package, mostly USAID but also
Corporation for Public Broadcasting, and we have some we may
make some adjustments there in terms of where we think
this may be may have gone too far in some cases,
and so we're in the process of that right now.
Speaker 7 (34:28):
Well and well, the end result of that process, Senator,
risk being that Democrats do not find themselves ultra willing
for a bipartisan compromise on appropriations on keeping the government
funded beyond September thirtieth, because they know there's always a
risk that funding gets rescinded.
Speaker 10 (34:45):
Well, I think that the Democrats are certainly making that argument.
I think basically the overwhelmingly, the overwhelming opinion across the country,
and what President Trump campaigned on is that the usaid money,
much of it and this is not cutting all of it,
of course, but much of it is used for ways
that are really not benefiting global health and others that
(35:05):
it's advertised for. And also the fact that the Corporation
for Public Broadcasting, particularly on the NPR side, has for
years been very much a left leaning organization, and why
are we using our taxpayer dollars for this? So these
are pretty well defined areas that the President talked about,
So the Democrats shouldn't be surprised by this. We are
(35:28):
in appropriations. I just came from my appropriations meeting. It
could be a rocky road here, but we did pass
two bills out of committee, so there's a plus.
Speaker 3 (35:36):
We would love to hear a little bit more about that.
Speaker 2 (35:38):
But I'd also like to ask you first about the
President's Big beautiful bill. Senator, I saw some local reporting
from West Virginia that you were met by a small
band of protesters at not a town hall, but a
ribbon cutting event in Fayetteville, in your home state. Do
you have any buyer's remorse for this bill concerns about
changes to medicator will you?
Speaker 3 (36:00):
Can you tell us that these.
Speaker 2 (36:00):
Were democratic activists and this is the cost of doing business.
Speaker 9 (36:04):
Well, you know what. I stopped and talked.
Speaker 10 (36:06):
We talked to ten fifteen minutes before the event that
was opening up a really beautiful bike trail in Fayetteville,
West Virginia, so I'd invite visitors to visit it, and
I tried to talk about the facts of the bill.
The facts of the bill is every West Virginia taxpayer
will not see their taxes go up. Their taxes will
actually go down because we increase the standard deduction. We
(36:27):
also provide seniors with a tax break of those that
are relying on Social Security, no taxes on tips, no
taxes on overtime.
Speaker 9 (36:35):
So this isn't important for West Virginia.
Speaker 10 (36:37):
Their main focus was, as you would expect, medicaid and
basically what I tried to tell them and what I believe,
and why I do not have buyer's remorse is that
I believe in order to preserve Medicaid for future generations,
we've got to get people off of it that don't
deserve to be there. That we have to bend the
curve and spending, and we will be spending two hundred
billion over ten years, just not a trillion, and I
(36:58):
really think a body people being able to work some
for their benefits.
Speaker 9 (37:03):
In my view, these are not unreasonable asks.
Speaker 10 (37:06):
And the thing I'm concerned about is are these programs
going to be there in ten twenty years and at
the rate of growth the answers know, so we need
to make sure that this is going to the people
that it's intended for and serve their health needs the best.
The Rural Stabilization Fund is big in my state because
obviously we're very rural in West Virginia, and I think
this will help our hospitals that have issues are going
(37:29):
to have some issues with affordability well.
Speaker 7 (37:32):
And that Stabilization Fund, to the tune, of course, of
fifty billion dollars, do you expect Senator that to be adequate?
Not knowing it's not just West Virginia that is going
to need the assistance, but states across the country or
could their need be a need that arises for further
subsidies for those hospitals.
Speaker 10 (37:48):
Well, I think we need to keep in mind too
that the changes were made on the provider tax and
other things on Medicaid don't go into effect for three years,
so we've got time to adjust here. If in fact
what you're saying is true, I think what we're going
to see is our rural hospitals stronger because they're going
to run more efficiently. There's going to be ways through
(38:09):
CMS and others to make sure that it systems and
everything are better coordinated.
Speaker 9 (38:14):
I have confidence that.
Speaker 10 (38:15):
Rural health care and rural health care delivery is very difficult,
and we've got to preserve every avenue, and that means
preserving all the rural hospitals in my state and across
the country.
Speaker 2 (38:25):
We talked a lot of senator about the cuts to
subsidies for clean energy. We were just discussing wind and
solar with Congressman Chuck Fleischman. What does that mean for
West Virginia and will it create a demand for more coal?
Speaker 10 (38:40):
Well, I think what it does is evens the playing
field for every resource or every source of energy supply.
It also I think boosts nuclear energy. We have all
this energy demand through AI and data centers. We can't
meet the demand, so we need baseload energy, which wind
and solar.
Speaker 9 (38:58):
Do not provide. It's euphemeral.
Speaker 10 (39:01):
Sometimes it works, sometimes it doesn't. We need that base load.
So that's natural gas, coal, nuclear, and there's a hydrogen
piece in there that's particularly of interest to me. I
asked to move the deadline out just a little bit
to see if we can jumpstart a lot of these projects,
and I was successful with that. So I think it
really just evens the playing field for all energy, all
(39:22):
types of energy, and I think it'll be good for
my state because we're an energy state.
Speaker 7 (39:28):
Senator, I'd like to go back to the subject of
appropriations in your seat on the committee, Senator rather Congressman.
Fleischman also just told us that he's expecting a short
term continuing resolution is likely going to be required to
keep the government funded beyond the end of the fiscal year.
Is that also your expectation.
Speaker 10 (39:46):
Well, I mean, we wouldn't have to make that decision
until the end of September. The Leader Leader throone has
said with our chair Chair Collins and Vice Chair Murray
that we want to.
Speaker 9 (39:57):
Have these bills up on the floor. Let's give that
a chance to work. I mean, we're running out of time.
Speaker 10 (40:02):
We only have seven weeks, but we do have seven weeks,
so hopefully we can have some successes there.
Speaker 9 (40:06):
Before I make the declaration.
Speaker 10 (40:08):
That we have to have a continuing resolution, I'd rather
see us keep this process moving as much as we can.
Speaker 7 (40:15):
All right, Senator, we appreciate your time joining us live
from Capitol Hill. Republican Senator Shelley Moore, Capital of West
Virginia here with us on Bloomberg TV and Radio. Thank
you so much, and we want to continue the conversation
now as we turn here to our political panel. Mrick
Davis is with us Bloomberg Politics contributor, Republican strategist and
Stone Court Capital partner, alongside Archie Sadiki, former senior aide
(40:36):
to former Speaker of the House Nancy Pelosi, now founder
and CEO of Bellweather Government Affairs. Welcome to you both.
R She to begin with you, we were just speaking
with both the Senator and the Congressman about this notion
that Democrats may not have much incentive to make a
spending deal with Republicans that are pursuing at the same
time recisions of previously appropriated spending by Congress. We know
(40:58):
Nancy Pelosi wasn't afraid to hold a firm line on
spending oriented deals and shutdowns when she needed to. What
do you expect to happen here as we approach the
end of the fiscal year?
Speaker 11 (41:09):
I think your question was spot on because the recisions
discussion is going to be critical in terms of paving
the future in terms of not only the continuing resolution, appropriations, etc.
And as you know, in the Senate has traditionally been
very bipartisan, and this recisions bill, they're talking about changes,
and the question is are they bringing in Democrats? Are
they because you know, to your point, if you can't
(41:31):
rely on a deal that's made, and we've already seen
Republicans go back on these types of deals. So I think,
particularly after this past reconciliation bill, I think it's going
to set the tone for the rest of the year.
Speaker 2 (41:42):
Rick, would it be who for Republicans to step away
from the recisions plan in hopes of actually clearing a
budget before the end of the fiscal year.
Speaker 12 (41:51):
I'd love to tell you that I'm enthusiastic that we
could get the regular order in a past twelve appropriations
bills before the end of September given up. You know,
Mark this da Davis doesn't think the sel so so
so look, I think that the Senate may creator the
(42:13):
recisions package on its own right. There are lots of
Senators concerned about pepfar getting stricken and rural radio, as
you mentioned in your last interview, has become a real
big issue for people like Center Rounds and Senator Sullivan,
so that may die on its own court. That being said,
whether or not the Senate can actually produce appropriation pills
(42:34):
on time, my guess is soon has a plan to.
Speaker 6 (42:37):
Do a continuing resolution.
Speaker 12 (42:40):
He will continue the public attitude that we want to
do our business. But of course there's never been anybody
fired from a chairmanship because they didn't get the appropriations done.
So at the end of the day, count me as skeptical.
Speaker 7 (42:55):
Well, when we consider what the Senate majority leader might
have its his sleeve, it's also a question of the
Minority leader of Hockey Jeffreys in the House. How should
we be thinking about the democratic calculus here? As to
whether or not they want to play hardball on this
issue risk a shutdown, how that plays for them politically.
I just wonder what kind of leverage they're really working with.
Speaker 11 (43:16):
I mean, traditionally, Democrats have always put government first in
terms of that continuity. So I think we have seen
that quite a bit. But I do think that there
is a tried and true blueprint of bipartisan by cameral
negotiations on these packages. I mean, time and time again,
I think we're in an aberration in terms of moving
away from that in this past negotiation. And you know,
(43:39):
the Reconciliation Bill, when you have one party control, that
is usually given that. You know when you have the House,
White House, and Senate. But on the appropriations packages and
you're in packages, those have generally been bipartisan, and that's
a give and take. So I think that's both sides.
I mean, so far the Republicans have not been willing
to do that give and take. But I do think
that Democrats are going to drive a hard bargain and
(44:03):
but again I think the recisions package will pay that way.
Speaker 2 (44:06):
Hakim Jeffries has a very different style than Nancy Pelosi do.
What would your former boss have been doing right now,
because I feel like she would have been screaming from
the rooftops about this. Hakim Jeffries has a much more,
much more subtle approach. How loud does he need to
get about recisions?
Speaker 11 (44:22):
So I think Hakiem Jeffries needs to be hackem Jeffries. Yeah, absolutely.
I mean we're in a different era, there's generational shift.
I talked to a lot of members of Congress there
there there there's a lot of support for Jeffries. He's
very thoughtful, he's very smart. He really does try to
put country first. So I think it's a different style.
(44:44):
So I don't think we should that that shouldn't be
the template. He's also can be very tough. I mean
he's a tough politician. He comes from New York.
Speaker 2 (44:50):
I'm not questioning that. But sometimes you need to put
this on front street so people know about it.
Speaker 11 (44:53):
Absolutely and you you saw him on the floor. I
think that was a shining moment for Jeffries, right like
the leader was on the floor or eight plus hours
he broke the record. So I think from that perspective,
I think Democrats are very united against this bill because
it really represents it's not the usual tax bill that
we've seen in the past. It's an ideological bill in
many respects. So I think that's going to serve as
(45:15):
the blueprint for Jeffreys going forward.
Speaker 7 (45:18):
Well, Democrats may not like the bill, but it's the
bill that the President wanted, Rick, and it's the bill
the President ultimately got. To the point you were making
a few minutes ago about you think the Senate might
ultimately and this recision's effort all on its own, How
is that going to sit with Donald Trump?
Speaker 9 (45:33):
Do you expect?
Speaker 12 (45:34):
Well, you know, it was interesting when a bill was
first submitted, there wasn't really a strong commitment by the
White House. They said things like, well, you know, we've
got more we can send if this one goes through,
you know, kind of raising a question like how committed
are you to really drive this through? And so, you know,
I think this is actually, you know, sort of ball
in the Senate court. It's really up to them to
(45:57):
decide whether that they want to see another one hundred
billion dollars in recisions coming from the White House, because
if this doesn't pass, it's highly likely to raise questions
inside the White House whether this is a good commitment
of their time and effort. You know, with Congress, they've
got a lot of agenda items that they need to
get through Congress, and recision packages have historically never fared well.
(46:21):
And in this case, especially when you think you have
a backlog of hundreds of billions of dollars with more
recisions to come, you know, does Congress really want to
get in that business? I mean, these are very difficult
votes for some of these members, and you know how
many times you're going to ask them to walk the plank?
Speaker 3 (46:39):
Just have thirty seconds? Are she? If this doesn't pass?
Is this the last vestige of the Doge?
Speaker 9 (46:44):
Well?
Speaker 11 (46:44):
I think what's interesting about the doge is that there's
supposed to be two trillion dollars in cuts, and as
we know, this recision bill is nine billion dollars in change.
Speaker 9 (46:52):
So I think that speaks for a lot, a bit of.
Speaker 2 (46:55):
A delta there, Yeah, a little different, Yes, indeed, are she?
Thanks for joining our panel. We'd love to have you
back soon as we can. Archie Sidiki and Rick Davis
with a smart conversation you'll only hear on Balance of Power.
Thanks for listening to the Balance of Power podcast. Make
sure to subscribe if you haven't already, at Apple, Spotify,
(47:17):
or wherever you get your podcasts, and you can find
us live every weekday from Washington, DC at noontime Eastern
at Bloomberg dot com
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