July 25, 2025 • 40 mins
Watch Joe and Kailey LIVE every day on YouTube: http://bit.ly/3vTiACF.
Donald Trump arrives in Scotland on Friday evening for a private five-day visit of his mother’s ancestral home, taking in two golf resorts he owns. UK Prime Minister Keir Starmer knows full well that when it comes to this US president, little is ever really private.
Trump’s first trip to Britain since his reelection will see him travel to his estates at Turnberry on Scotland’s picturesque west coast and Menie in Aberdeenshire. It comes only weeks before he crosses the Atlantic again on an official state visit to meet King Charles III in September. For Starmer, who will meet Trump in Scotland, it’s not without its risks.
The two leaders have struck up an unlikely partnership this year, with Trump repeatedly commenting on their positive working relationship in spite of the premier’s left-wing politics: “for some reason, we get along,” he said alongside Starmer at the Group of Seven summit in Canada last month.
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. On this edition, Bloomberg Washington Correspondent Tyler Kendall is in for Kailey. Joe and Tyler speak with:
- Bloomberg Senior Editor Wendy Benjaminson.
- Former National Economic Council Director and Former Federal Reserve Vice Chair Lael Brainard.
- Bloomberg Politics Contributors Rick Davis and Jeanne Sheehan Zaino.
- Former RNC Communications Director Lisa Camooso Miller.
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
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(00:20):
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Speaker 2 (00:25):
President Trump heading over to Scotland. A headline breaking on
the Bloomberg terminal last hour that he's going to meet
with the eus Ursula Vonderlion to continue trade talks. But
another big focus, and definitely the focus of yesterday, was
President Trump's recent comments about the FED Chair Jerome Powell,
and he was asked about his visit to the fed's
renovation site yesterday as he headed out on his trip.
(00:47):
We want to bring you part of what he said earlier.
Speaker 3 (00:49):
We had a very good meeting forgetting about the building
that's out of control of Bolder, but I think we
had a very good meeting.
Speaker 4 (00:56):
On interest right. And he said to me, and I
don't know if he's good to say this on Thursday
or every state, but he said to me very strongly,
the country is doing well. He said, congratulations, the country is.
Speaker 5 (01:10):
Doing really well.
Speaker 4 (01:12):
And I got back to me that I think he's
going to start.
Speaker 3 (01:15):
Recommending LAWA ray hot out there today in the nation's capital.
It's ninety something agrees right now. It's supposed to feel
like one hundred and seven later. So maybe his timing
was right. As opposed to those going to Fenway Park
this weekend, that ought to be something, although I guess
they're making some good sessions to make that work. Tyler Kendall,
The President said one thing yesterday. By the way, we're
(01:37):
going to be talking about this with Lale Brainerd in
a moment, and I can't wait to hear her thoughts
on this. Having written an op ed in the Washington
Post about this very matter, Wendy Benjamin said, the President
yesterday said, I think he's going to start recommending lawer
rates because of that conversation. That is a continuation of
the pressure campaign.
Speaker 6 (01:56):
It absolutely is a continuation of the pressure just when
we thought after that meeting that the pressure had eased
up a bit, right because he toured the construction side,
which is something former developer Donald Trump loves to do.
He put on a hard hat, he walked through the
construction side, and he seemed to deem it under control.
Slap Powell on the back, made her joke about interest rates,
(02:18):
Powell stunningly fact checked him publicly in real time, seemed
to have gotten away with it, so and markets reacted
positively to that whole scene, thinking, well, now Powell has
his job.
Speaker 2 (02:32):
Now.
Speaker 6 (02:33):
The morning's comments could mean that Trump still feels very
confident that now Powell sees things the way he does.
But come Thursday, if those interest rates don't come down,
I think I think he'll be back to being what
Donald Trump calls a numbskull and too late, and the
disappointment and all that, and this nice little bromance that
(02:53):
brewed up yesterday will be over again.
Speaker 2 (02:55):
Well, let's look at this broader picture, because we have
a great story on the Bloomberg terminal this morning. And
I know that you edited Wendy about this idea of
how Trump's strategy when it comes to pressuring the Fed
is about flooding the zone. Can you talk to us
what led to us to this point, because this originally
started with the administration right pointing to economic data for example.
(03:16):
And now we've taken a turn, and there's this highlight
on the Fed's recent renovations.
Speaker 6 (03:20):
Right, and Nancy Cook wrote this brilliant story about this,
and it is. It is one of Trump's absolute techniques
that he uses for a lot of different things. We
see it with him distracting people, trying to distract people
from the Jeffrey Epstein story. What he does is something
called Steve Bannon cooined flooding the zone. So Powell, you know,
(03:41):
isn't lowering interest rates. The Fed is renovating its building.
This is wrong. He's a bad person. He just attacks
from so many angles that it's impossible for the target
to respond to one thing because another thing pops up
over here, and something else pops up over there. And
that's what this renovation, this renovation scandal and I'm doing
(04:03):
air quotes was all about, because there was no scandal.
Speaker 4 (04:06):
It was.
Speaker 6 (04:07):
It's a building build in the nineteen thirties, it was
filled with asbestos and lead. It hadn't been renovated since
the nineteen thirties, and you know, it needed a little
touch up. And I do think Trump sort of got
that when he walked through yesterday.
Speaker 3 (04:20):
He didn't find Versailles.
Speaker 6 (04:21):
He didn't fight I guess when he got.
Speaker 3 (04:23):
There, as russ Vote suggested. So again, is this simply
about pressuring Powell to cut rates or does Donald Trump
want him to resign? He says it's not a fireable offense.
But if you make life miserable enough for someone, And
I know that Jay Powell has said he's going nowhere,
is that the aim here?
Speaker 4 (04:39):
Right?
Speaker 6 (04:40):
I think he really wants the interest rates down. I
don't think he cares what I mean. He remember he
appointed J. Powell in the first place, and so at
some point they saw eye do I on things enough
for him to become a FED chairman? And I think
if Powell were to do that, then everything would be fine.
If he doesn't, I also think Trump knows the blowbag,
(05:00):
not only politically but from the market. So firing a
FED chair would be so severe that He's just going
to keep needling Powell and needling him until probably until
his term is up in May twenty twenty six. Because
Powell is showing a great deal of confidence. He doesn't
need this job, right, and so he's showing a great
deal of confidence and saying, you know, this is what
(05:21):
I think. Fire me if you will, but this is
what I think is right for the economy, which the
FED chair gets to do in our country that it works.
Speaker 7 (05:29):
Yeah, all right, a lot to watch for here.
Speaker 2 (05:31):
Wendy Benjaminson, Senior editor at Bloomberg, We thank you so much,
and to continue this conversation, we want to bring in
Lale Brainerd, former director of the National Economic Council under
the Biden administration, for our vice chair of the Federal Reserve,
now distinguished fellow at the Georgetown Center for Financial Markets
and Policies. Lale, thank you so much for joining Bloomberg.
(05:51):
I just want to pick up on this conversation. President
Trump says he's not going to fire Jerome Powell. So
is this just all about trying to see lower rates
next week when that Phonem's meets.
Speaker 8 (06:02):
There's probably a few things that are going on.
Speaker 6 (06:05):
One.
Speaker 8 (06:06):
I think it is an effort to pressure the Federal
Reserve for lower rates. It's also a distraction. You know,
that was a picture for the Ages yesterday, the President
standing next to the chairman of the Federal Reserve wearing
hard hats. Quite a story, and it also serves to
(06:30):
find a place to have blame to the extent that
the economy is not as strong as the President has
said that it would be at this juncture. You heard
him say that the Federal Reserve should be lowering rates
and that's the only thing standing in the way. So
I think it does serve multiple purposes in terms of
(06:54):
the storyline. But we also know that Federal Reserve chairs
go down in history for actually following their mandate and
not caving to political pressure, and those that do cave
to political pressures tend not to be viewed very favorablely
in the history books.
Speaker 3 (07:15):
Leil, it's great to have you with us. I want
to ask you about the op ed that you wrote
recently in the Washington Post, an opinion piece with the
headline the real reason Trump wants to fire the Fed
share You say it has everything to do with debt management.
The President wants to reduce the debt service on the
trillions his megabill will add to the national debt. So
now we're connecting the dots to the President's big, beautiful bill.
(07:38):
The fact is, and you say this in your piece,
they are saying it out loud. Lael Peter Navarro sat
right at this desk a couple of days ago and
talked about the need to lower interest rates in an
effort to save a trillion dollars when it comes to
our debt. Is this the new mission creep? We hear
a lot about mission creep in the central bank? Is
(07:59):
this a version of that in your eyes?
Speaker 8 (08:02):
Well, certainly, this is the kind of diversion of the
Federal Reserve from its core inflation fighting mission to supporting
the administration's desire to finance this big new increase in
the national debt cheaply. That is traditionally the way that
(08:26):
central banks in other countries like Brazil or Turkey, Argentina
go awry and lose that credibility on inflation fighting. So
I have to say that I was surprised to hear
the President say it out loud when he says, every
percentage point reduction in interest rates translates into three hundred
(08:48):
billion dollars. What he's talking about is interest payments on
the national debt. And when he says, you know, if
the Fed will cut by three percentage points down to
one percentage point, that'll save us a trillion dollars in
debt service, that's what he's really referring to. And he
said it quite explicitly, and economists have a term for
(09:11):
it because it has happened so many times in history.
It's called fiscal dominance when debt management becomes more important
for the central bank than fighting inflation, and what happens
is you lose control of inflation and ultimately long term
interest rates actually go up.
Speaker 2 (09:32):
Well, we did actually get a different sort of answer
when we posed this question to Jill Lavornia, a senior
counselor to the Treasury Secretary Scott Besson, about concerns when
it comes to the long end of the yield curve.
He joined us on Balance of Power last week. I
want to play you with some of his reaction and
then get your reaction on the other side.
Speaker 9 (09:50):
I don't see how markets are going to be worried
about that. In fact, if you look at where yields are,
they're lower than where they started the year. And when
a lot of the people who are worried about the
market selling off because of credibility and things of that sort,
these are many the same folks who back in April
said the US was uninvestable, And yet we had Treasury
data that came out today that should essentially record inflow
(10:10):
into the market with treasury demand virtually at an all
time high. So these arguments I don't think hold up
to really scrutiny into the facts.
Speaker 2 (10:20):
We should say that a response was last week on
July seventeenth. But Laoe, I'm wondering what you make of
that defense when it comes to this issue.
Speaker 8 (10:29):
Well, what we did see when the markets were really
reacting to news that this administration would really pressure the
Federal Reserve and might fire the chair of the Federal
Reserve back in April, that was the first time I
think market participants really were digesting that news, and there
was a lot of repositioning, as you'll recall, And what
(10:52):
we saw is that the long end of the curve
did actually go up quite a bit and the dollar weekend.
That is the kind of response that you tend to
see in circumstances where central banks lose credibility on the
fight against inflation, because investors demand more compensation to hold
(11:13):
longer term securities, sovereign securities, treasury securities if they think
that the currency is going to be weaker and inflation
is going to go up. So that is just the
traditional kind of market reaction we have seen it. We
certainly saw it back in April. Now I believe markets
I have seen the president back down say that he's
(11:35):
not going to fire the Federal Reserve chair yesterday. He
was even somewhat complimentary. And I think that's why you're
not seeing those kinds of reactions right now in markets.
But I do think the reaction we saw in April
was a cautionary tale.
Speaker 3 (11:52):
It did seem the President came fixing for a bit
of a fight yesterday, Leale, I'm sure you were watching
as the two war hard hats the President pulled a
piece of paper out of his suit jacket to prove
to the FED chair that not only was the renovation
at the Echos building running over in terms of money,
but more than he thought, and he added a whole
(12:14):
new building to the list. Let's bring everybody back to
the construction site. Watch and listen.
Speaker 4 (12:19):
It looks like it's about three point one billion, one
up a little bit or a lot. So the two
point seven is now three point one. Yeah, it just
came out.
Speaker 9 (12:30):
Yeah, I haven't heard that from anybody that FED.
Speaker 5 (12:32):
You're including the Martin renovation.
Speaker 9 (12:34):
You just added into third buildings.
Speaker 2 (12:35):
What that is?
Speaker 5 (12:36):
That's a third building.
Speaker 4 (12:38):
It's a building that's being built now.
Speaker 8 (12:39):
It's been he was built five years ago.
Speaker 4 (12:41):
Well, i'd love him to lower interest rates. Other than that,
what can.
Speaker 3 (12:45):
I tell you complete with a knock on the back there, leol,
I'm wondering, as you watched this and had a chance
to digest everything that happened yesterday, does this go down
as a good day for fed independence.
Speaker 8 (13:01):
I think what was interesting is that the Federal Reserve
had a chance to explain what was going on with
their renovations. These are very old buildings. They have two
buildings that really haven't been renovated I think since the
nineteen thirties and one that just was renovated for the
(13:22):
first time since the nineteen seventies. And I thought what
was interesting is that the President really came out of
those discussions, you know, really showing his long experience as
a real estate developer. You know, he talked about how
hard it is to build on a former swamp and
(13:43):
the kind of very expensive renovations that are necessary to
you know, really be secure in pushing down when there
are concerns about the water table. So in a way,
it was interest to see the President getting into the
(14:03):
complexities of the renovation in that sense. Yes, I think
it was a good day just for transparency around the
Federal Reserve. Which is so important because the Federal Reserve
has to be accountable to the public.
Speaker 2 (14:19):
Well, I do want to go back to this idea
of so called mission creep that Joe had mentioned earlier.
We've heard this critique from Treasury Secretary Scott Besson, from
Kevin Warrish, who we know is potentially in the running
to be the next FED chair. Do you think that
it would be healthy for the FED to conduct a
review of its non monetary policy activities? Is that something
that you think would actually be a good thing for
(14:40):
the FED to look into, whether or not that's an
external review for example.
Speaker 8 (14:46):
So I always think that the Federal Reserve benefits from
being accountable and transparent to the public and particularly to Congress.
And it's really Congress who has oversight of the Federal
Reserve who wrote the Federal Reserve Act that governs the
monetary policy and the Dodd Frank Act that governs their
(15:07):
responsibilities in financial stability policy. So I do think those
kinds of reviews are very beneficial, and there are many
mechanisms that the Federal Reserve could use to undertake such
a review. The thing that would concern me, I have
heard the Secretary of the Treasury, saying that the administration
(15:30):
would undertake a review and that does raise some concerns.
Speaker 3 (15:35):
Well, I'm sorry, we're out of time. Sorry, I'd love
to have you come back to finish this conversation. It's
wonderful to have you back on Balance of Power. Former
Director National Economic Council, former Vice Chair of the Federal Reserve,
Laiel Brainerd wh us live from Washington only here on
Bloomberg TV and Radio.
Speaker 1 (15:52):
You're listening to the Bloomberg Balance of Power podcasts. Catch
us live weekdays at noon and five pms den on
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Speaker 2 (16:11):
Right now, we're waiting for President Trump to touch down
in Scotland. He's heading overseas, and lawmakers in Washington are
actually heading home for their August recess where Joe. They're
going to have to answer to their constituents when it
comes to perhaps the big, the big achievement from the
last few weeks, the big beautiful Bill, and a lot
of other things that have happened recently in Congress, and
(16:33):
one of the things we're watching for the new polling
out showing that despite perhaps unpopularity with that bill, President
Trump's popularity has actually maintained.
Speaker 7 (16:42):
Course.
Speaker 3 (16:42):
Yeah, I mean it's not just the bill, it's the
Jeffrey Epstein scandal, it's the stuff we've been talking about
regarding trade, the uncertainty over tariffs. And look at this
unchanged really since April. Slightly underwater when you consider forty
six percent, but not bad with all of the headlines
that we've been looking at. Disapprove at fifty two percent, Tyler,
(17:04):
and you could potentially have a much different situation for
Republican lawmakers. To your point when they get home for
August reesis in getting an earful at town hall meetings
they're about to begin.
Speaker 2 (17:15):
And it was such a good point about the tariffs too,
because we have to keep in mind that President Trump
really ran on his handling of the economy poll after
a poll leading up to the election, kept telling us
that that was really where he was significantly ahead, and
that ultimately helped him clinch it. So amidst so much uncertainty.
As we're still waiting ahead of that August first deadline
for some more tariff deals. These numbers are pretty remarkable.
Speaker 3 (17:37):
Well true, there is actually something really interesting that pops
out of this poll. It's really important to go beyond
the headline numbers. Sometimes the fact of the matter is
forty seven percent in the survey rate the economy as
excellent or good. That is a significant increase in eleven
point jump from April and by far the highlight in
this poll for Donald Trump. We're going to talk about
(17:58):
this and what lawmakers are going to experience in the
week's ahead here now that recess has begun with our
political panel Bloomberg Politics contributors Rick Davis and Gene Shanzeno
are with us. Rick is, of course, our Republican strategist
and partner at Stone Court Capital. Genie is senior Democracy
Fellow at the Center for the Study of the Presidency
and Congress. Rick, what's your thought here on how you
(18:19):
rationalize these approval ratings. We talked about some different numbers
from IPSOS yesterday against some of the vitriol that lawmakers
are expecting to hear when they get home.
Speaker 5 (18:31):
Yeah, obviously, Joe, the point you make about the big
jump in the approval of the economy is the standout
number here, right, That's what's driving the sustainability of the
Donald Trump approval rating. And it's different than any other
poll I've seen, including the Michigan Consumer Sentiment Index for
the month, which I of course have to bring up,
(18:51):
which actually is noticeably more depressing in the consumer attitudes
than this pole would indicate. That being said, also really
interesting is it's not arguable that the Reconciliation Bill is
wildly unpopular. Most polls, including this one, give it an
approval at a negative sixty percent. Immigration, even in this poll,
(19:15):
has gone down in popularity for Donald Trump, and tariffs
are wildly unpopular. So even though the three signature issues
that have defined his presidency in the first six months
are underwater with the electorate, you know, he has sustained
(19:40):
relative stability in his job approval rating.
Speaker 2 (19:45):
Well to that point. Let's talk about the power of
the base, Jaimie. This poll finds that eighty eight percent
of GOP voters approve of President Trump's performance, with sixty
six percent strongly approving. With numbers like these, what kind
of signal does that give to publicans ahead of the midterms?
Do they have to expand the base here when you
have such a high number eighty eight percent overall approving
(20:07):
of his performance they do.
Speaker 10 (20:09):
It's a very strong number, and I've seen it in
other polls on the base as high as ninety plus percent.
So he is doing very well in his base despite
their frustration with or concerns about the Epstein issue and
some of the issues that Rick just talked about, including
his signature issue of immigration, where his poll numbers with
his base have gone down. You know, I do think
(20:32):
what this means is that they're going to have to
focus on the midterm and shore up that base and
make sure they can get them out to vote. And
one thing we know is it's a lot easier to
get people out to vote when they're angry rather than
when they're satisfied. I will give Donald Trump credit for this.
He has done already six months in a lot more
(20:55):
work towards the midterm than I think most presidents do,
and much more than he focused on it in the
first term. I mean, he is really focused like a
laser beam on this midterm election. So Democrats who think
they can sort of run on a history where the
other party will do worse, they have their work cut
out for them, But they have some things going for them,
(21:17):
including this dislike of everything he's done on the big
beautiful bill, the tariffs and immigration, three signature issues.
Speaker 3 (21:26):
I suspect we'll hear the name Jeffrey Epstein at most
all of these town hall meetings. Seventy six percent of
voters in this new poll in the Wall Street Journal,
by the way, that includes sixty four percent of Republicans,
say they believe the Justice Department is hiding important information
when it comes to Jeffrey Epstein. Rick, They're going to
be Democratic trackers at all of these town halls, Right,
(21:48):
if you're a Republican lawmaker, how do you manage this?
Speaker 5 (21:52):
Yeah, I think you're going to see a slew of
viral videos coming out of town halls over the course
the next couple week weeks for these House members doing so,
indicating a lot of anger and frustration over their inability
to make public the documents they promise they would do
(22:12):
related to the Jeffrey Epstein case. And everyone already is
on defense in Washington, right, this thing is turned into
a mess, But Democrats are taking advantage of it as
well they should, and there's trackers are going to be
in all these swings districts, and there's, as Ricky Ricardo
used to say, there's lots of splain and the do
(22:33):
you know to these constituents who are wondering, Hey, you
promised to get this done and you haven't done it yet.
So Republics are gonna have to be pretty agile on
how they manage the situation at home.
Speaker 2 (22:45):
Well, is that the strategy then for Democrats on the
other side, Genie, Because yes, we have some of these
pretty good talking points when it comes to Epstein and
how unpopular we know the big beautiful bill is. But
we already are hearing from Republicans starting to message around
the idea of a government and shut down in the
fall when they get back in talk about the potency
here of all these different threads that Democrats have the
(23:06):
ability to pull on, but they're also up against that
pretty hard messaging from the GOP.
Speaker 10 (23:12):
They absolutely are, Tyler. I mean, the issue of the shutdown,
We're going to really see how agile the Democrats can be.
I think there is a message there for them to
say that the administration Republicans are not willing to cross
the island deal with them in a fair bipartisan manner,
but it's not an easy message to make. They are
(23:33):
starting to get out there more on the Ebstein issue.
I saw recently when I was venturing through TikTok some
video of Ron DeSantis bending off some of the people
talking about the Ebstein case. We're going to see a
lot more of that. To Rick's point, also, we are
seeing billboards around the country already talking about the Big
(23:55):
Beautiful Bill and labeling the shutdown, particularly in rural commun unities,
of these hospitals and medical centers, as Trump's doing the
Republicans doing so. Democrats will try to run against the
big Beautiful Bill on repeal, on holding Republicans rather to
the fire on Epstein, and they're going to have to
watch their back on the shut down message. So it's
(24:18):
going to be a fun mid term to say the least, Tyler,
We're going to have a lot of fun.
Speaker 3 (24:23):
And it starts now, Jeanie. And you know, you talk
about Jeffrey Epstein, you have to mention a half dozen
other stories that the White House is thrown up in
the air to get us talking about other stuff. Look
no further than this headline with the Senate Judiciary Republicans
John Cornyn and Lindsey Graham now calling on the Attorney
General to appoint a special council to investigate President Barack Obama,
(24:47):
his staff, members of his administration, the president saying in
the driveway today that the Supreme Court ruling on presidential
immunity probably means that Obama's going to be fine. Everybody
else not so much. Is the kind of overreach Democrats
are hoping for?
Speaker 10 (25:03):
Absolutely, you know, this puts them, This puts the Republicans
in a difficult situation. They don't much like special councils
as we can remember, and when Laura Lumer was calling
for one in the Epstein case, they shied away from that. So, yeah,
they're going to have a difficult time then calling for
just certain special councils and not others and getting over
(25:24):
their dislike of special counsels to begin with. So and
by the way, Donald Trump is right, he is protected
as well as Barack Obama when it comes to immunity.
Speaker 2 (25:35):
Well, Rick, just in our final couple of minutes here,
I love your perspective on this too. Is this going
to be too far of a push when it comes
for Republicans? Could this backfire.
Speaker 5 (25:45):
Yeah, I really don't get it. We're kind of all
falling into this, you know, sort of conspiracy theory trap.
And that stuff's great, you know, sitting around the fire
and the winner when you got nothing else to do
but rick whiskey and to talk about, you know, conspiracy theories.
But like you know, arguably the polling we were just
talking about indicates that Donald Trump's got a little bit
(26:06):
of win at his back, assuming you can get these
tariffs done. Immigration is now down to zero on the border,
and the economy seems to be starting to percolate along.
I mean, certainly a record day on the markets today.
Why in the world would you distract anybody from that
message set. I mean, like it's like the administration is
going out of their way to distract people from what's
(26:29):
really important to them. These conspiracy theories are only important
to the core base of the MAGA movement that are
going to do nothing but vote for Donald Trump no
matter how many times he runs for president. And so,
like you know, there is indications that independents are starting
to get a little fed up with this stuff, and
(26:51):
they've got to focus on those guys if they want
to have a Republican Congress in twenty twenty seven.
Speaker 3 (26:57):
Wow, we've just got a minute left here, genieus, you
consider the options ahead here for President Trump, who's going
to be meeting with the Europeans on Sunday. To Rick's point,
if he can land a deal with the EU, does
that approval rating get back above water over fifty in
his first year in office.
Speaker 10 (27:17):
I don't know if the EU will be enough, but
it certainly a step in the right direction. I think
China's going to be critically important, and Joe I can't
get over Rick's talking about winter fires and whiskey. So
I'm having a hard time to bring your question as
I think about these days and Rick around the fire.
But yeah, it would help, but I don't think it'll
change completely.
Speaker 8 (27:38):
All right.
Speaker 2 (27:38):
Our political panel today, Rick Davis and Jeanie Shanzano, both
Bloomberg Politics contributors.
Speaker 1 (27:47):
You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 3 (28:03):
Charlie, I don't know, I was thinking we were going
to meet for the Dodgers game this weekend. That's gonna
be hot. It's one hundred and something degrees in Boston
today at least, you know, it feels like one hundred
something degrees. You know they call it the best bar
in Boston. Charlie, Fenway Park, I don't know how you
do it without without the taps on.
Speaker 1 (28:19):
Without a doubt.
Speaker 3 (28:20):
We'll see you there, big green monster.
Speaker 10 (28:21):
You're buying, okay, if we can get up.
Speaker 3 (28:25):
He's live from New York. Exactly well done. See I
know Charlie knows Boston. If you're with us on ninety
two nine, we see you and feel you, and maybe
we'll smell you later after a weekend, I guess. Without concessions,
workers at Fenway Park, the Era Mark folks have gone
on strike. As everybody heads home here, you know, they say, DC,
(28:46):
we just saw this yesterday. We've got the worst traffic
in the country, now topping Los Angeles. How's that for
a superlative, The worst traffic in the nation, de throning
LA for its famous congestion. This is according to a
Consumer of Fairs ranking. The average daily commute is the
longest in the United States. At over thirty three minutes.
(29:06):
And by the way, most people I know around here
are doing well over an hour. And you can thank
everybody coming back to the office, private sector organizations following
the FEDS to get everybody back to work. But this
weekend and for the next month, not so much as
House lawmakers head home with a whole schedule full of
(29:27):
town halls waiting for them, fundraisers and so forth, and
they're going to be talking about the big beautiful bill, unless,
of course, George Santos, you're going to prison today. I
don't know if you've heard about this, but it's real.
The curtain falls, the spotlight dims, and the rhinestones are packed.
Yeah there it is. Good job Cecie George Santos on
(29:50):
xay and goodnight Irene. He reports to prison today to
begin a seven year sentence. Did a whole bunch of
interviews on the way out. I'm guessing it won't be
too long before the jailhouse interview takes place. Lisa Camuso
Miller has probably known a couple of lawmakers who took
that path, but that's not why she's here tonight. The
(30:12):
former RNC communications director Republican strategist and host of the
Friday Reporter podcast is with us right now to sort
of get a sense of what is waiting for lawmakers
in the month of August. Lisa, it's great to see you.
I hope you're ready for the rest of this summer,
because this is when it gets real in Washington. Right
lawmakers are going to start holding town halls, and they
(30:33):
have got a pretty tough argument to make, according to
the polling we saw this morning in the Wall Street Journal.
Forget Donald Trump's approval rating right now, look at the
polling on the approval for the Big Beautiful Bill. Forty
two percent think it's a good thing. Fifty two percent,
a majority of Americans disapprove. This is the Wall Street
Journal once again. You can see it on screen if
(30:54):
you're with us on YouTube. Lisa, how do you sell
that message in a town hall in the weeks ahead?
Speaker 7 (31:02):
I think, Joe, I think each and every one of
these members that's going home is probably Republican or Democrat.
It's a bipartisan difficult time to talk about these issues
because the Big Beautiful Bill, as they're calling it, was
supposed to really answer some of those concerns that voters
had when they went to the polls last November. And
(31:23):
now it's not just a game of getting the work done,
it's a messaging game. It's really it's become a back
and forth. There's been some question about what will happen
to rural hospitals, There's been some question about what will
happen to access to care, access to resources. And so
I think that this is going to be a really
big challenge, not only for Republicans who supported and enacted
(31:44):
this legislation, but for Democrats who were there in Washington
who couldn't stop it from happening. And so regardless of
who's in charge, it's a very thin margin. It's a
very thin amount of power that each party has in
Washington today, and the town halls are going to be
spicier than ever before, and I think that that really
makes it very difficult, and it's going to make it
(32:05):
that much more discouraging for them to come back in
August to get appropriations done and all the other work
that has to happen before the end of the year.
Speaker 3 (32:12):
So bring me inside this whole process. Here, you're a lawmaker,
you're head home, you're on the phone with your chief
roomever Hey, we've got a schedule. You're talking to the
Home office. You're going to do two town halls. Do
you have any control over who attends these? Because Republicans
always tell us, well, it's Democratic activists showing up. They
hated us to begin with, and they didn't like this bill.
But who are the actual voters showing up at these
(32:34):
events and how authentic is their message?
Speaker 7 (32:38):
Well, you know, Joe, it depends on the district. Every
district handles it differently. But the truth of it is
that once you're elected, you are the elected for the
entire district, regardless of what party affiliation you have. I mean,
party affiliation is about getting elected, but once you're in place,
you are supposed to govern for all in your district.
And I suspect that the ones that show up at
(32:59):
these towns are the ones that are the most irritated
and concerned about what the direction is that's happening not
only in the district but in Washington, d C. And
so Yes, of course there's going to be back and
forth about whether or not it's filled with Democrat operatives
and Democrat mischief. But the truth of it is is
that regardless of your party people are not pleased with
the way things are going in Washington, d C. They
(33:21):
want to see action. They want people to stop talking
about things that don't seem to affect their lives all
that much. And I'm referring to that list of bad
actors as we talk about that Epstein disgusting and deplorable
activities on that side of the message meter. There's so
much to talk about, and it makes it that much
harder for the members who then have to stand before
(33:43):
their constituents Republicans, Democrats are otherwise and talk about what
it is they're doing in Washington without getting sort of
mired down in the political back and forth that happens
inevitably every time we have a town hall.
Speaker 3 (33:55):
Well, you went there, so let's talk about Jeffrey Epstein.
I'm guessing that this is going to come up at
all of these town hall meetings as well. And while
we're talking about polling, we had new numbers from IPSOS
yesterday that Cliff Young brought us here. Take a look
at this approval of the handling of the Epstein files,
the way the administration is handling them. GOP support is
only at thirty five percent, Democratic support four everyone else
(34:19):
is at seventeen. The President couldn't get out of the
White House this morning without being faced with at least
a half dozen questions about Epstein. He didn't really answer
any of them. All he did was talk about how
Todd blanche was a great lawyer, and how what you
really ought to be looking at is Bill Clinton and
the Democrats who were on this supposed list. Lisa, what
should lawmakers be saying about this?
Speaker 7 (34:41):
I think lawmakers, regardless of their party to say that
this is a disgusting and deplorable situation. What had happened
under Jeffrey Epstein and his reign of terror and everything
else and anyone else that was involved in it, but
it deserves a full throated investigation. It should not be
treated as politics because they were I human beings involved
and hurt in what happened here, and the President and
(35:05):
everyone else that has anything to say about it ought
to act swiftly and act responsibly to get to the
bottom of the issues that are at hand here, make
sure that those that are guilty are called to action,
and that we can get back to the issues that
the American people care about. Because Joe, I think some
people will ask questions about Jeffrey Epstein in the town halls.
(35:28):
But more importantly, the American people want their real issues,
their home inside the House, budget issues address so that
they can get back to feeling like the American government
is doing what it's supposed to do to serve them well.
And that's the big distraction. That's the one thing that
I think is the greatest disadvantage to what's happening today,
(35:48):
that we're distracted by a horrible thing that happened. I
think everyone agrees that Jeffrey Epstein and the reign of
hideous things that happen with him and all the people
involved ought to be addressed. But we can walk in
shoes shot down the floor.
Speaker 3 (36:04):
I don't know what you thought about this. I don't
know if other speakers would have acted the same way,
but they're great worries that this is actually going to
keep us from getting a budget together. With a limited
time that they'll have when they get back between you know,
Labor Day and the end of September, we're going to
be dealing with this and as lawmakers get home, it's
not just voters, so we'll be bringing it up. Lisa
the DNC, as I'm sure you saw is making ads
(36:27):
to run the rest of the summer about Jeffrey Epstein
in a dozen Republican held house districts. It's going to
coincide with the recess, according to Axios, and will run.
These videos are online, they'll run right before you see
something on a right wing YouTube channel. They're also going
to be on some Fox videos as well. I don't
(36:49):
know if these are necessary though, because people, from what
we're hearing, are calling Republican lawmakers offices all day long
demanding the release of these documents. What do the ads do?
Speaker 7 (37:02):
I think there's a real risk in those ads, Joe.
I really hope that the Democrats are thoughtful enough. As
someone who's an operative who sees all the contours of
these kinds of issues, I really do hope that they're
mindful that there is a danger in overstepping and a
danger in pushing this too much to be too political,
because it very well could back It could backsplash on
(37:24):
them in a way that's not helpful. Yes, people want
to know more. They want answers to this Jeffrey Epstein issue,
and in general, they'd like to see the list. What
they really want is they want a scout, and I
think Democrats think that there's an opportunity here to inflict
harm on the president. And I think that Republicans see
this as a distraction from Republicans in Congress. Specifically, the
(37:45):
Speaker himself saw this as something that was standing in
the way of progress, so set aside politics. It was
definitely holding the Congress away from the possibility of advancing
legislation and getting work done. Another distraction and another political football.
It ought not to be a political football. It ought
to be a dress, and it ought to be questions
(38:07):
ought to be answered. But the back and the forth,
I think is just another example of how the American
people look at Washington and think we're not serious because
we're letting all of these other things get in the
way of them doing their job.
Speaker 3 (38:21):
Can't argue with that. The President today, when asked about it,
Lisa said he has not considered granting a pardon to
Gallaine Maxwell. What would happen if he.
Speaker 7 (38:30):
Did, Oh, I think people would probably assume that that's
just another example of how the president is some way,
in somehow entangled in all of this nonsense that's gone on.
I mean, it seems to me the way his handling
has been of this has been one that appears to
be a guilty behavior. His behavior is concerning to people,
(38:55):
and the fact that he continues to talk about it
continues to make people wonder what role he has had
in any of this. But more importantly, he's doing everything
he can to distract from that by pointing at others
that were involved, by pointing at other issues, by raising
up other There has been a huge amount of distraction
in terms of the news every single day coming from
(39:17):
the White House. But Joe, you and I both know
that sooner or later there's either going to be someone
to answer for this or it's going to be just
another thing where either we overreact or we do nothing
in Washington, DC, And that's always the criticism of how
we do work here in the Capitol unbelievable.
Speaker 3 (39:34):
I feel like to be a riot in Lafayette Square
if that pardon came along. Interesting. When he was asked
about potentially pardoning p Diddy, he said he might think
about it. This one not so much. Lisa, It's great
to see you. We're overdue. Lisa Camusso Miller Friddy Reporter podcast,
former RNC communications director look for on LinkedIn she makes
(39:56):
magic out of that platform. Thanks for listening to the
Balance of Power podcast. Make sure to subscribe if you
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(00:20):
you get your podcasts, or watch us live on YouTube.
Speaker 2 (00:25):
President Trump heading over to Scotland. A headline breaking on
the Bloomberg terminal last hour that he's going to meet
with the eus Ursula Vonderlion to continue trade talks. But
another big focus, and definitely the focus of yesterday, was
President Trump's recent comments about the FED Chair Jerome Powell,
and he was asked about his visit to the fed's
renovation site yesterday as he headed out on his trip.
(00:47):
We want to bring you part of what he said earlier.
Speaker 3 (00:49):
We had a very good meeting forgetting about the building
that's out of control of Bolder, but I think we
had a very good meeting.
Speaker 4 (00:56):
On interest right. And he said to me, and I
don't know if he's good to say this on Thursday
or every state, but he said to me very strongly,
the country is doing well. He said, congratulations, the country is.
Speaker 5 (01:10):
Doing really well.
Speaker 4 (01:12):
And I got back to me that I think he's
going to start.
Speaker 3 (01:15):
Recommending LAWA ray hot out there today in the nation's capital.
It's ninety something agrees right now. It's supposed to feel
like one hundred and seven later. So maybe his timing
was right. As opposed to those going to Fenway Park
this weekend, that ought to be something, although I guess
they're making some good sessions to make that work. Tyler Kendall,
The President said one thing yesterday. By the way, we're
(01:37):
going to be talking about this with Lale Brainerd in
a moment, and I can't wait to hear her thoughts
on this. Having written an op ed in the Washington
Post about this very matter, Wendy Benjamin said, the President
yesterday said, I think he's going to start recommending lawer
rates because of that conversation. That is a continuation of
the pressure campaign.
Speaker 6 (01:56):
It absolutely is a continuation of the pressure just when
we thought after that meeting that the pressure had eased
up a bit, right because he toured the construction side,
which is something former developer Donald Trump loves to do.
He put on a hard hat, he walked through the
construction side, and he seemed to deem it under control.
Slap Powell on the back, made her joke about interest rates,
(02:18):
Powell stunningly fact checked him publicly in real time, seemed
to have gotten away with it, so and markets reacted
positively to that whole scene, thinking, well, now Powell has
his job.
Speaker 2 (02:32):
Now.
Speaker 6 (02:33):
The morning's comments could mean that Trump still feels very
confident that now Powell sees things the way he does.
But come Thursday, if those interest rates don't come down,
I think I think he'll be back to being what
Donald Trump calls a numbskull and too late, and the
disappointment and all that, and this nice little bromance that
(02:53):
brewed up yesterday will be over again.
Speaker 2 (02:55):
Well, let's look at this broader picture, because we have
a great story on the Bloomberg terminal this morning. And
I know that you edited Wendy about this idea of
how Trump's strategy when it comes to pressuring the Fed
is about flooding the zone. Can you talk to us
what led to us to this point, because this originally
started with the administration right pointing to economic data for example.
(03:16):
And now we've taken a turn, and there's this highlight
on the Fed's recent renovations.
Speaker 6 (03:20):
Right, and Nancy Cook wrote this brilliant story about this,
and it is. It is one of Trump's absolute techniques
that he uses for a lot of different things. We
see it with him distracting people, trying to distract people
from the Jeffrey Epstein story. What he does is something
called Steve Bannon cooined flooding the zone. So Powell, you know,
(03:41):
isn't lowering interest rates. The Fed is renovating its building.
This is wrong. He's a bad person. He just attacks
from so many angles that it's impossible for the target
to respond to one thing because another thing pops up
over here, and something else pops up over there. And
that's what this renovation, this renovation scandal and I'm doing
(04:03):
air quotes was all about, because there was no scandal.
Speaker 4 (04:06):
It was.
Speaker 6 (04:07):
It's a building build in the nineteen thirties, it was
filled with asbestos and lead. It hadn't been renovated since
the nineteen thirties, and you know, it needed a little
touch up. And I do think Trump sort of got
that when he walked through yesterday.
Speaker 3 (04:20):
He didn't find Versailles.
Speaker 6 (04:21):
He didn't fight I guess when he got.
Speaker 3 (04:23):
There, as russ Vote suggested. So again, is this simply
about pressuring Powell to cut rates or does Donald Trump
want him to resign? He says it's not a fireable offense.
But if you make life miserable enough for someone, And
I know that Jay Powell has said he's going nowhere,
is that the aim here?
Speaker 4 (04:39):
Right?
Speaker 6 (04:40):
I think he really wants the interest rates down. I
don't think he cares what I mean. He remember he
appointed J. Powell in the first place, and so at
some point they saw eye do I on things enough
for him to become a FED chairman? And I think
if Powell were to do that, then everything would be fine.
If he doesn't, I also think Trump knows the blowbag,
(05:00):
not only politically but from the market. So firing a
FED chair would be so severe that He's just going
to keep needling Powell and needling him until probably until
his term is up in May twenty twenty six. Because
Powell is showing a great deal of confidence. He doesn't
need this job, right, and so he's showing a great
deal of confidence and saying, you know, this is what
(05:21):
I think. Fire me if you will, but this is
what I think is right for the economy, which the
FED chair gets to do in our country that it works.
Speaker 7 (05:29):
Yeah, all right, a lot to watch for here.
Speaker 2 (05:31):
Wendy Benjaminson, Senior editor at Bloomberg, We thank you so much,
and to continue this conversation, we want to bring in
Lale Brainerd, former director of the National Economic Council under
the Biden administration, for our vice chair of the Federal Reserve,
now distinguished fellow at the Georgetown Center for Financial Markets
and Policies. Lale, thank you so much for joining Bloomberg.
(05:51):
I just want to pick up on this conversation. President
Trump says he's not going to fire Jerome Powell. So
is this just all about trying to see lower rates
next week when that Phonem's meets.
Speaker 8 (06:02):
There's probably a few things that are going on.
Speaker 6 (06:05):
One.
Speaker 8 (06:06):
I think it is an effort to pressure the Federal
Reserve for lower rates. It's also a distraction. You know,
that was a picture for the Ages yesterday, the President
standing next to the chairman of the Federal Reserve wearing
hard hats. Quite a story, and it also serves to
(06:30):
find a place to have blame to the extent that
the economy is not as strong as the President has
said that it would be at this juncture. You heard
him say that the Federal Reserve should be lowering rates
and that's the only thing standing in the way. So
I think it does serve multiple purposes in terms of
(06:54):
the storyline. But we also know that Federal Reserve chairs
go down in history for actually following their mandate and
not caving to political pressure, and those that do cave
to political pressures tend not to be viewed very favorablely
in the history books.
Speaker 3 (07:15):
Leil, it's great to have you with us. I want
to ask you about the op ed that you wrote
recently in the Washington Post, an opinion piece with the
headline the real reason Trump wants to fire the Fed
share You say it has everything to do with debt management.
The President wants to reduce the debt service on the
trillions his megabill will add to the national debt. So
now we're connecting the dots to the President's big, beautiful bill.
(07:38):
The fact is, and you say this in your piece,
they are saying it out loud. Lael Peter Navarro sat
right at this desk a couple of days ago and
talked about the need to lower interest rates in an
effort to save a trillion dollars when it comes to
our debt. Is this the new mission creep? We hear
a lot about mission creep in the central bank? Is
(07:59):
this a version of that in your eyes?
Speaker 8 (08:02):
Well, certainly, this is the kind of diversion of the
Federal Reserve from its core inflation fighting mission to supporting
the administration's desire to finance this big new increase in
the national debt cheaply. That is traditionally the way that
(08:26):
central banks in other countries like Brazil or Turkey, Argentina
go awry and lose that credibility on inflation fighting. So
I have to say that I was surprised to hear
the President say it out loud when he says, every
percentage point reduction in interest rates translates into three hundred
(08:48):
billion dollars. What he's talking about is interest payments on
the national debt. And when he says, you know, if
the Fed will cut by three percentage points down to
one percentage point, that'll save us a trillion dollars in
debt service, that's what he's really referring to. And he
said it quite explicitly, and economists have a term for
(09:11):
it because it has happened so many times in history.
It's called fiscal dominance when debt management becomes more important
for the central bank than fighting inflation, and what happens
is you lose control of inflation and ultimately long term
interest rates actually go up.
Speaker 2 (09:32):
Well, we did actually get a different sort of answer
when we posed this question to Jill Lavornia, a senior
counselor to the Treasury Secretary Scott Besson, about concerns when
it comes to the long end of the yield curve.
He joined us on Balance of Power last week. I
want to play you with some of his reaction and
then get your reaction on the other side.
Speaker 9 (09:50):
I don't see how markets are going to be worried
about that. In fact, if you look at where yields are,
they're lower than where they started the year. And when
a lot of the people who are worried about the
market selling off because of credibility and things of that sort,
these are many the same folks who back in April
said the US was uninvestable, And yet we had Treasury
data that came out today that should essentially record inflow
(10:10):
into the market with treasury demand virtually at an all
time high. So these arguments I don't think hold up
to really scrutiny into the facts.
Speaker 2 (10:20):
We should say that a response was last week on
July seventeenth. But Laoe, I'm wondering what you make of
that defense when it comes to this issue.
Speaker 8 (10:29):
Well, what we did see when the markets were really
reacting to news that this administration would really pressure the
Federal Reserve and might fire the chair of the Federal
Reserve back in April, that was the first time I
think market participants really were digesting that news, and there
was a lot of repositioning, as you'll recall, And what
(10:52):
we saw is that the long end of the curve
did actually go up quite a bit and the dollar weekend.
That is the kind of response that you tend to
see in circumstances where central banks lose credibility on the
fight against inflation, because investors demand more compensation to hold
(11:13):
longer term securities, sovereign securities, treasury securities if they think
that the currency is going to be weaker and inflation
is going to go up. So that is just the
traditional kind of market reaction we have seen it. We
certainly saw it back in April. Now I believe markets
I have seen the president back down say that he's
(11:35):
not going to fire the Federal Reserve chair yesterday. He
was even somewhat complimentary. And I think that's why you're
not seeing those kinds of reactions right now in markets.
But I do think the reaction we saw in April
was a cautionary tale.
Speaker 3 (11:52):
It did seem the President came fixing for a bit
of a fight yesterday, Leale, I'm sure you were watching
as the two war hard hats the President pulled a
piece of paper out of his suit jacket to prove
to the FED chair that not only was the renovation
at the Echos building running over in terms of money,
but more than he thought, and he added a whole
(12:14):
new building to the list. Let's bring everybody back to
the construction site. Watch and listen.
Speaker 4 (12:19):
It looks like it's about three point one billion, one
up a little bit or a lot. So the two
point seven is now three point one. Yeah, it just
came out.
Speaker 9 (12:30):
Yeah, I haven't heard that from anybody that FED.
Speaker 5 (12:32):
You're including the Martin renovation.
Speaker 9 (12:34):
You just added into third buildings.
Speaker 2 (12:35):
What that is?
Speaker 5 (12:36):
That's a third building.
Speaker 4 (12:38):
It's a building that's being built now.
Speaker 8 (12:39):
It's been he was built five years ago.
Speaker 4 (12:41):
Well, i'd love him to lower interest rates. Other than that,
what can.
Speaker 3 (12:45):
I tell you complete with a knock on the back there, leol,
I'm wondering, as you watched this and had a chance
to digest everything that happened yesterday, does this go down
as a good day for fed independence.
Speaker 8 (13:01):
I think what was interesting is that the Federal Reserve
had a chance to explain what was going on with
their renovations. These are very old buildings. They have two
buildings that really haven't been renovated I think since the
nineteen thirties and one that just was renovated for the
(13:22):
first time since the nineteen seventies. And I thought what
was interesting is that the President really came out of
those discussions, you know, really showing his long experience as
a real estate developer. You know, he talked about how
hard it is to build on a former swamp and
(13:43):
the kind of very expensive renovations that are necessary to
you know, really be secure in pushing down when there
are concerns about the water table. So in a way,
it was interest to see the President getting into the
(14:03):
complexities of the renovation in that sense. Yes, I think
it was a good day just for transparency around the
Federal Reserve. Which is so important because the Federal Reserve
has to be accountable to the public.
Speaker 2 (14:19):
Well, I do want to go back to this idea
of so called mission creep that Joe had mentioned earlier.
We've heard this critique from Treasury Secretary Scott Besson, from
Kevin Warrish, who we know is potentially in the running
to be the next FED chair. Do you think that
it would be healthy for the FED to conduct a
review of its non monetary policy activities? Is that something
that you think would actually be a good thing for
(14:40):
the FED to look into, whether or not that's an
external review for example.
Speaker 8 (14:46):
So I always think that the Federal Reserve benefits from
being accountable and transparent to the public and particularly to Congress.
And it's really Congress who has oversight of the Federal
Reserve who wrote the Federal Reserve Act that governs the
monetary policy and the Dodd Frank Act that governs their
(15:07):
responsibilities in financial stability policy. So I do think those
kinds of reviews are very beneficial, and there are many
mechanisms that the Federal Reserve could use to undertake such
a review. The thing that would concern me, I have
heard the Secretary of the Treasury, saying that the administration
(15:30):
would undertake a review and that does raise some concerns.
Speaker 3 (15:35):
Well, I'm sorry, we're out of time. Sorry, I'd love
to have you come back to finish this conversation. It's
wonderful to have you back on Balance of Power. Former
Director National Economic Council, former Vice Chair of the Federal Reserve,
Laiel Brainerd wh us live from Washington only here on
Bloomberg TV and Radio.
Speaker 1 (15:52):
You're listening to the Bloomberg Balance of Power podcasts. Catch
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Speaker 2 (16:11):
Right now, we're waiting for President Trump to touch down
in Scotland. He's heading overseas, and lawmakers in Washington are
actually heading home for their August recess where Joe. They're
going to have to answer to their constituents when it
comes to perhaps the big, the big achievement from the
last few weeks, the big beautiful Bill, and a lot
of other things that have happened recently in Congress, and
(16:33):
one of the things we're watching for the new polling
out showing that despite perhaps unpopularity with that bill, President
Trump's popularity has actually maintained.
Speaker 7 (16:42):
Course.
Speaker 3 (16:42):
Yeah, I mean it's not just the bill, it's the
Jeffrey Epstein scandal, it's the stuff we've been talking about
regarding trade, the uncertainty over tariffs. And look at this
unchanged really since April. Slightly underwater when you consider forty
six percent, but not bad with all of the headlines
that we've been looking at. Disapprove at fifty two percent, Tyler,
(17:04):
and you could potentially have a much different situation for
Republican lawmakers. To your point when they get home for
August reesis in getting an earful at town hall meetings
they're about to begin.
Speaker 2 (17:15):
And it was such a good point about the tariffs too,
because we have to keep in mind that President Trump
really ran on his handling of the economy poll after
a poll leading up to the election, kept telling us
that that was really where he was significantly ahead, and
that ultimately helped him clinch it. So amidst so much uncertainty.
As we're still waiting ahead of that August first deadline
for some more tariff deals. These numbers are pretty remarkable.
Speaker 3 (17:37):
Well true, there is actually something really interesting that pops
out of this poll. It's really important to go beyond
the headline numbers. Sometimes the fact of the matter is
forty seven percent in the survey rate the economy as
excellent or good. That is a significant increase in eleven
point jump from April and by far the highlight in
this poll for Donald Trump. We're going to talk about
(17:58):
this and what lawmakers are going to experience in the
week's ahead here now that recess has begun with our
political panel Bloomberg Politics contributors Rick Davis and Gene Shanzeno
are with us. Rick is, of course, our Republican strategist
and partner at Stone Court Capital. Genie is senior Democracy
Fellow at the Center for the Study of the Presidency
and Congress. Rick, what's your thought here on how you
(18:19):
rationalize these approval ratings. We talked about some different numbers
from IPSOS yesterday against some of the vitriol that lawmakers
are expecting to hear when they get home.
Speaker 5 (18:31):
Yeah, obviously, Joe, the point you make about the big
jump in the approval of the economy is the standout
number here, right, That's what's driving the sustainability of the
Donald Trump approval rating. And it's different than any other
poll I've seen, including the Michigan Consumer Sentiment Index for
the month, which I of course have to bring up,
(18:51):
which actually is noticeably more depressing in the consumer attitudes
than this pole would indicate. That being said, also really
interesting is it's not arguable that the Reconciliation Bill is
wildly unpopular. Most polls, including this one, give it an
approval at a negative sixty percent. Immigration, even in this poll,
(19:15):
has gone down in popularity for Donald Trump, and tariffs
are wildly unpopular. So even though the three signature issues
that have defined his presidency in the first six months
are underwater with the electorate, you know, he has sustained
(19:40):
relative stability in his job approval rating.
Speaker 2 (19:45):
Well to that point. Let's talk about the power of
the base, Jaimie. This poll finds that eighty eight percent
of GOP voters approve of President Trump's performance, with sixty
six percent strongly approving. With numbers like these, what kind
of signal does that give to publicans ahead of the midterms?
Do they have to expand the base here when you
have such a high number eighty eight percent overall approving
(20:07):
of his performance they do.
Speaker 10 (20:09):
It's a very strong number, and I've seen it in
other polls on the base as high as ninety plus percent.
So he is doing very well in his base despite
their frustration with or concerns about the Epstein issue and
some of the issues that Rick just talked about, including
his signature issue of immigration, where his poll numbers with
his base have gone down. You know, I do think
(20:32):
what this means is that they're going to have to
focus on the midterm and shore up that base and
make sure they can get them out to vote. And
one thing we know is it's a lot easier to
get people out to vote when they're angry rather than
when they're satisfied. I will give Donald Trump credit for this.
He has done already six months in a lot more
(20:55):
work towards the midterm than I think most presidents do,
and much more than he focused on it in the
first term. I mean, he is really focused like a
laser beam on this midterm election. So Democrats who think
they can sort of run on a history where the
other party will do worse, they have their work cut
out for them, But they have some things going for them,
(21:17):
including this dislike of everything he's done on the big
beautiful bill, the tariffs and immigration, three signature issues.
Speaker 3 (21:26):
I suspect we'll hear the name Jeffrey Epstein at most
all of these town hall meetings. Seventy six percent of
voters in this new poll in the Wall Street Journal,
by the way, that includes sixty four percent of Republicans,
say they believe the Justice Department is hiding important information
when it comes to Jeffrey Epstein. Rick, They're going to
be Democratic trackers at all of these town halls, Right,
(21:48):
if you're a Republican lawmaker, how do you manage this?
Speaker 5 (21:52):
Yeah, I think you're going to see a slew of
viral videos coming out of town halls over the course
the next couple week weeks for these House members doing so,
indicating a lot of anger and frustration over their inability
to make public the documents they promise they would do
(22:12):
related to the Jeffrey Epstein case. And everyone already is
on defense in Washington, right, this thing is turned into
a mess, But Democrats are taking advantage of it as
well they should, and there's trackers are going to be
in all these swings districts, and there's, as Ricky Ricardo
used to say, there's lots of splain and the do
(22:33):
you know to these constituents who are wondering, Hey, you
promised to get this done and you haven't done it yet.
So Republics are gonna have to be pretty agile on
how they manage the situation at home.
Speaker 2 (22:45):
Well, is that the strategy then for Democrats on the
other side, Genie, Because yes, we have some of these
pretty good talking points when it comes to Epstein and
how unpopular we know the big beautiful bill is. But
we already are hearing from Republicans starting to message around
the idea of a government and shut down in the
fall when they get back in talk about the potency
here of all these different threads that Democrats have the
(23:06):
ability to pull on, but they're also up against that
pretty hard messaging from the GOP.
Speaker 10 (23:12):
They absolutely are, Tyler. I mean, the issue of the shutdown,
We're going to really see how agile the Democrats can be.
I think there is a message there for them to
say that the administration Republicans are not willing to cross
the island deal with them in a fair bipartisan manner,
but it's not an easy message to make. They are
(23:33):
starting to get out there more on the Ebstein issue.
I saw recently when I was venturing through TikTok some
video of Ron DeSantis bending off some of the people
talking about the Ebstein case. We're going to see a
lot more of that. To Rick's point, also, we are
seeing billboards around the country already talking about the Big
(23:55):
Beautiful Bill and labeling the shutdown, particularly in rural commun unities,
of these hospitals and medical centers, as Trump's doing the
Republicans doing so. Democrats will try to run against the
big Beautiful Bill on repeal, on holding Republicans rather to
the fire on Epstein, and they're going to have to
watch their back on the shut down message. So it's
(24:18):
going to be a fun mid term to say the least, Tyler,
We're going to have a lot of fun.
Speaker 3 (24:23):
And it starts now, Jeanie. And you know, you talk
about Jeffrey Epstein, you have to mention a half dozen
other stories that the White House is thrown up in
the air to get us talking about other stuff. Look
no further than this headline with the Senate Judiciary Republicans
John Cornyn and Lindsey Graham now calling on the Attorney
General to appoint a special council to investigate President Barack Obama,
(24:47):
his staff, members of his administration, the president saying in
the driveway today that the Supreme Court ruling on presidential
immunity probably means that Obama's going to be fine. Everybody
else not so much. Is the kind of overreach Democrats
are hoping for?
Speaker 10 (25:03):
Absolutely, you know, this puts them, This puts the Republicans
in a difficult situation. They don't much like special councils
as we can remember, and when Laura Lumer was calling
for one in the Epstein case, they shied away from that. So, yeah,
they're going to have a difficult time then calling for
just certain special councils and not others and getting over
(25:24):
their dislike of special counsels to begin with. So and
by the way, Donald Trump is right, he is protected
as well as Barack Obama when it comes to immunity.
Speaker 2 (25:35):
Well, Rick, just in our final couple of minutes here,
I love your perspective on this too. Is this going
to be too far of a push when it comes
for Republicans? Could this backfire.
Speaker 5 (25:45):
Yeah, I really don't get it. We're kind of all
falling into this, you know, sort of conspiracy theory trap.
And that stuff's great, you know, sitting around the fire
and the winner when you got nothing else to do
but rick whiskey and to talk about, you know, conspiracy theories.
But like you know, arguably the polling we were just
talking about indicates that Donald Trump's got a little bit
(26:06):
of win at his back, assuming you can get these
tariffs done. Immigration is now down to zero on the border,
and the economy seems to be starting to percolate along.
I mean, certainly a record day on the markets today.
Why in the world would you distract anybody from that
message set. I mean, like it's like the administration is
going out of their way to distract people from what's
(26:29):
really important to them. These conspiracy theories are only important
to the core base of the MAGA movement that are
going to do nothing but vote for Donald Trump no
matter how many times he runs for president. And so,
like you know, there is indications that independents are starting
to get a little fed up with this stuff, and
(26:51):
they've got to focus on those guys if they want
to have a Republican Congress in twenty twenty seven.
Speaker 3 (26:57):
Wow, we've just got a minute left here, genieus, you
consider the options ahead here for President Trump, who's going
to be meeting with the Europeans on Sunday. To Rick's point,
if he can land a deal with the EU, does
that approval rating get back above water over fifty in
his first year in office.
Speaker 10 (27:17):
I don't know if the EU will be enough, but
it certainly a step in the right direction. I think
China's going to be critically important, and Joe I can't
get over Rick's talking about winter fires and whiskey. So
I'm having a hard time to bring your question as
I think about these days and Rick around the fire.
But yeah, it would help, but I don't think it'll
change completely.
Speaker 8 (27:38):
All right.
Speaker 2 (27:38):
Our political panel today, Rick Davis and Jeanie Shanzano, both
Bloomberg Politics contributors.
Speaker 1 (27:47):
You're listening to the Bloomberg Balance of Power podcast. Catch
us live weekdays at noon and five pm Eastern on Apple, Cocklay,
and Android Otto with the Bloomberg Business App. Listen on
demand wherever you get your podcasts, or watch us live
on YouTube.
Speaker 3 (28:03):
Charlie, I don't know, I was thinking we were going
to meet for the Dodgers game this weekend. That's gonna
be hot. It's one hundred and something degrees in Boston
today at least, you know, it feels like one hundred
something degrees. You know they call it the best bar
in Boston. Charlie, Fenway Park, I don't know how you
do it without without the taps on.
Speaker 1 (28:19):
Without a doubt.
Speaker 3 (28:20):
We'll see you there, big green monster.
Speaker 10 (28:21):
You're buying, okay, if we can get up.
Speaker 3 (28:25):
He's live from New York. Exactly well done. See I
know Charlie knows Boston. If you're with us on ninety
two nine, we see you and feel you, and maybe
we'll smell you later after a weekend, I guess. Without concessions,
workers at Fenway Park, the Era Mark folks have gone
on strike. As everybody heads home here, you know, they say, DC,
(28:46):
we just saw this yesterday. We've got the worst traffic
in the country, now topping Los Angeles. How's that for
a superlative, The worst traffic in the nation, de throning
LA for its famous congestion. This is according to a
Consumer of Fairs ranking. The average daily commute is the
longest in the United States. At over thirty three minutes.
(29:06):
And by the way, most people I know around here
are doing well over an hour. And you can thank
everybody coming back to the office, private sector organizations following
the FEDS to get everybody back to work. But this
weekend and for the next month, not so much as
House lawmakers head home with a whole schedule full of
(29:27):
town halls waiting for them, fundraisers and so forth, and
they're going to be talking about the big beautiful bill, unless,
of course, George Santos, you're going to prison today. I
don't know if you've heard about this, but it's real.
The curtain falls, the spotlight dims, and the rhinestones are packed.
Yeah there it is. Good job Cecie George Santos on
(29:50):
xay and goodnight Irene. He reports to prison today to
begin a seven year sentence. Did a whole bunch of
interviews on the way out. I'm guessing it won't be
too long before the jailhouse interview takes place. Lisa Camuso
Miller has probably known a couple of lawmakers who took
that path, but that's not why she's here tonight. The
(30:12):
former RNC communications director Republican strategist and host of the
Friday Reporter podcast is with us right now to sort
of get a sense of what is waiting for lawmakers
in the month of August. Lisa, it's great to see you.
I hope you're ready for the rest of this summer,
because this is when it gets real in Washington. Right
lawmakers are going to start holding town halls, and they
(30:33):
have got a pretty tough argument to make, according to
the polling we saw this morning in the Wall Street Journal.
Forget Donald Trump's approval rating right now, look at the
polling on the approval for the Big Beautiful Bill. Forty
two percent think it's a good thing. Fifty two percent,
a majority of Americans disapprove. This is the Wall Street
Journal once again. You can see it on screen if
(30:54):
you're with us on YouTube. Lisa, how do you sell
that message in a town hall in the weeks ahead?
Speaker 7 (31:02):
I think, Joe, I think each and every one of
these members that's going home is probably Republican or Democrat.
It's a bipartisan difficult time to talk about these issues
because the Big Beautiful Bill, as they're calling it, was
supposed to really answer some of those concerns that voters
had when they went to the polls last November. And
(31:23):
now it's not just a game of getting the work done,
it's a messaging game. It's really it's become a back
and forth. There's been some question about what will happen
to rural hospitals, There's been some question about what will
happen to access to care, access to resources. And so
I think that this is going to be a really
big challenge, not only for Republicans who supported and enacted
(31:44):
this legislation, but for Democrats who were there in Washington
who couldn't stop it from happening. And so regardless of
who's in charge, it's a very thin margin. It's a
very thin amount of power that each party has in
Washington today, and the town halls are going to be
spicier than ever before, and I think that that really
makes it very difficult, and it's going to make it
(32:05):
that much more discouraging for them to come back in
August to get appropriations done and all the other work
that has to happen before the end of the year.
Speaker 3 (32:12):
So bring me inside this whole process. Here, you're a lawmaker,
you're head home, you're on the phone with your chief
roomever Hey, we've got a schedule. You're talking to the
Home office. You're going to do two town halls. Do
you have any control over who attends these? Because Republicans
always tell us, well, it's Democratic activists showing up. They
hated us to begin with, and they didn't like this bill.
But who are the actual voters showing up at these
(32:34):
events and how authentic is their message?
Speaker 7 (32:38):
Well, you know, Joe, it depends on the district. Every
district handles it differently. But the truth of it is
that once you're elected, you are the elected for the
entire district, regardless of what party affiliation you have. I mean,
party affiliation is about getting elected, but once you're in place,
you are supposed to govern for all in your district.
And I suspect that the ones that show up at
(32:59):
these towns are the ones that are the most irritated
and concerned about what the direction is that's happening not
only in the district but in Washington, d C. And
so Yes, of course there's going to be back and
forth about whether or not it's filled with Democrat operatives
and Democrat mischief. But the truth of it is is
that regardless of your party people are not pleased with
the way things are going in Washington, d C. They
(33:21):
want to see action. They want people to stop talking
about things that don't seem to affect their lives all
that much. And I'm referring to that list of bad
actors as we talk about that Epstein disgusting and deplorable
activities on that side of the message meter. There's so
much to talk about, and it makes it that much
harder for the members who then have to stand before
(33:43):
their constituents Republicans, Democrats are otherwise and talk about what
it is they're doing in Washington without getting sort of
mired down in the political back and forth that happens
inevitably every time we have a town hall.
Speaker 3 (33:55):
Well, you went there, so let's talk about Jeffrey Epstein.
I'm guessing that this is going to come up at
all of these town hall meetings as well. And while
we're talking about polling, we had new numbers from IPSOS
yesterday that Cliff Young brought us here. Take a look
at this approval of the handling of the Epstein files,
the way the administration is handling them. GOP support is
only at thirty five percent, Democratic support four everyone else
(34:19):
is at seventeen. The President couldn't get out of the
White House this morning without being faced with at least
a half dozen questions about Epstein. He didn't really answer
any of them. All he did was talk about how
Todd blanche was a great lawyer, and how what you
really ought to be looking at is Bill Clinton and
the Democrats who were on this supposed list. Lisa, what
should lawmakers be saying about this?
Speaker 7 (34:41):
I think lawmakers, regardless of their party to say that
this is a disgusting and deplorable situation. What had happened
under Jeffrey Epstein and his reign of terror and everything
else and anyone else that was involved in it, but
it deserves a full throated investigation. It should not be
treated as politics because they were I human beings involved
and hurt in what happened here, and the President and
(35:05):
everyone else that has anything to say about it ought
to act swiftly and act responsibly to get to the
bottom of the issues that are at hand here, make
sure that those that are guilty are called to action,
and that we can get back to the issues that
the American people care about. Because Joe, I think some
people will ask questions about Jeffrey Epstein in the town halls.
(35:28):
But more importantly, the American people want their real issues,
their home inside the House, budget issues address so that
they can get back to feeling like the American government
is doing what it's supposed to do to serve them well.
And that's the big distraction. That's the one thing that
I think is the greatest disadvantage to what's happening today,
(35:48):
that we're distracted by a horrible thing that happened. I
think everyone agrees that Jeffrey Epstein and the reign of
hideous things that happen with him and all the people
involved ought to be addressed. But we can walk in
shoes shot down the floor.
Speaker 3 (36:04):
I don't know what you thought about this. I don't
know if other speakers would have acted the same way,
but they're great worries that this is actually going to
keep us from getting a budget together. With a limited
time that they'll have when they get back between you know,
Labor Day and the end of September, we're going to
be dealing with this and as lawmakers get home, it's
not just voters, so we'll be bringing it up. Lisa
the DNC, as I'm sure you saw is making ads
(36:27):
to run the rest of the summer about Jeffrey Epstein
in a dozen Republican held house districts. It's going to
coincide with the recess, according to Axios, and will run.
These videos are online, they'll run right before you see
something on a right wing YouTube channel. They're also going
to be on some Fox videos as well. I don't
(36:49):
know if these are necessary though, because people, from what
we're hearing, are calling Republican lawmakers offices all day long
demanding the release of these documents. What do the ads do?
Speaker 7 (37:02):
I think there's a real risk in those ads, Joe.
I really hope that the Democrats are thoughtful enough. As
someone who's an operative who sees all the contours of
these kinds of issues, I really do hope that they're
mindful that there is a danger in overstepping and a
danger in pushing this too much to be too political,
because it very well could back It could backsplash on
(37:24):
them in a way that's not helpful. Yes, people want
to know more. They want answers to this Jeffrey Epstein issue,
and in general, they'd like to see the list. What
they really want is they want a scout, and I
think Democrats think that there's an opportunity here to inflict
harm on the president. And I think that Republicans see
this as a distraction from Republicans in Congress. Specifically, the
(37:45):
Speaker himself saw this as something that was standing in
the way of progress, so set aside politics. It was
definitely holding the Congress away from the possibility of advancing
legislation and getting work done. Another distraction and another political football.
It ought not to be a political football. It ought
to be a dress, and it ought to be questions
(38:07):
ought to be answered. But the back and the forth,
I think is just another example of how the American
people look at Washington and think we're not serious because
we're letting all of these other things get in the
way of them doing their job.
Speaker 3 (38:21):
Can't argue with that. The President today, when asked about it,
Lisa said he has not considered granting a pardon to
Gallaine Maxwell. What would happen if he.
Speaker 7 (38:30):
Did, Oh, I think people would probably assume that that's
just another example of how the president is some way,
in somehow entangled in all of this nonsense that's gone on.
I mean, it seems to me the way his handling
has been of this has been one that appears to
be a guilty behavior. His behavior is concerning to people,
(38:55):
and the fact that he continues to talk about it
continues to make people wonder what role he has had
in any of this. But more importantly, he's doing everything
he can to distract from that by pointing at others
that were involved, by pointing at other issues, by raising
up other There has been a huge amount of distraction
in terms of the news every single day coming from
(39:17):
the White House. But Joe, you and I both know
that sooner or later there's either going to be someone
to answer for this or it's going to be just
another thing where either we overreact or we do nothing
in Washington, DC, And that's always the criticism of how
we do work here in the Capitol unbelievable.
Speaker 3 (39:34):
I feel like to be a riot in Lafayette Square
if that pardon came along. Interesting. When he was asked
about potentially pardoning p Diddy, he said he might think
about it. This one not so much. Lisa, It's great
to see you. We're overdue. Lisa Camusso Miller Friddy Reporter podcast,
former RNC communications director look for on LinkedIn she makes
(39:56):
magic out of that platform. Thanks for listening to the
Balance of Power podcast. Make sure to subscribe if you
haven't already an Apple, Spotify, or wherever you get your podcasts,
and you can find us live every weekday from Washington,
d C. At noontime Eastern at Bloomberg dot com.
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