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And welcome to the Tuesday edition of Balance of Power here on Bloomberg Radio, on the satellite and on YouTube.
Glad you're with us.
I'm Joe, Matthew and Washington as we cook up something special for you here that I mentioned you were not going to see or hear anywhere else today but on Bloomberg TV and Radio. And that's a conversation with Dave McCormick, now a US Senate candidate in the swing state of Pennsylvania, the former Bridgewater CEO, in a campaign against longtime Senator Bob Casey, the Democrat. They each cleared their respective primaries, and now it's onto the general with a lot to
talk about. Week that found us reviewing the impact of Donald Trump's first visit to Capitol Hill since January sixth, and reviewing the conversations that took place inside the room at the Business Roundtable when Donald Trump rolled out his economic vision that included higher tariffs and making permanent the twenty seventeen Trump tax cuts. Now, Dave McCormick has been endorsed by Donald Trump in this campaign, and we're going to talk about his vision and the vision more broadly
of the Republican Party. Let's get to it right now with my colleague Shanali Bossick in New York live on Bloomberg.
I want to welcome and now our audience is across our Bloomberg television, radio, and YouTube platforms as one of finance's most notable names is running for a US Senate seat. That is, combat veteran and former Bridgewater CEO Dave McCormick is a Republican Senate candidate in Pennsylvania and joins me
with Bloomberg's Joe Matthew and Dave. There are a number of things we want to get to with you, but we were reconnected after you wrote an op ed entitled America Must Lead on Cryptocurrency, and you know, it was somewhat interesting to see the former CEO of the world's largest head fund take a pro crypto view given how reticent the financial industry has been in adopting crypto. Why is this a platform that's important to you?
Well, thanks for having me. Nice to see both of you. You know, the reason that I advocated this is I think it's it's good economic policy, but it's also good national security policy. And I've obviously been following a crypto for a while now and the developments around blockchain, and I always thought it had appeal as around the principles of individual freedom and privacy. You know, data security and data privacy is something that is incredibly important and increasingly so.
But I was always worried about the national security implications. And I think what's become clear is that we are in the next great wave of innovation with crypto and blockchain, and if America doesn't embrace that, we're going to be left behind. And by embracing it, we can create great jobs, a great source of innovation. I've lived through a number of waves of innovation, whether it was the PC and the Internet, or whether it's some of the new developments
around AI. This is one such wave that we need to embrace. And the national security implications of this are clear, which is that blockchain has very limited and crypto very limited listed activity, something like zero point three four five percent of the transactions. But it gives a roadmap for national security officials and prosecutors to zero in on a listed activity. So the national security and legal experts I talked to think that it offers a real source of eliminating,
not increasing a listed activity. And so, for all those reasons and important to Pennsylvania, a job creation engine for Pennsylvania, I've embraced this and encouraged lawmakers to lay out a regulatory framework that will allow innovation to continue.
It's interesting, Dave, Welcome, It's Joe Matthew in Washington, and great to see you as we consider this. You point out in your op ed that this is also a matter of staying competitive with, if not beating, China when it comes to crypto and I wonder if we could get to the matter of China right off the top, because we have a lot of questions for you on
the economy, on taxes and tariffs. Your opponent in your Senate race, Bob Casey, has pointed out repeatedly the role that you had at Bridgewater and directing investments toward companies based in China. Can you tell our listeners and viewers the extent to which you were personally involved, and the effort behind those investments, how you see them now?
Sure, Well, I've been very involved with China for more than twenty years as a policymaker in the Bush administration. I was one of the folks that was very involved in making sure that China didn't either steal or get access to some of our key technologies and is the global economy has evolved, and as China's evolved, it's become more and more of a national security threat, particularly with the rise of President Sheep, who has a very very aggressive view of China's role in the world visa the
United States. With regard to Bridgewater, Bridgewater is a global investment firm. We serve global clients. While I was there and still in Bridgewater's portfolio, there was something like two percent of its allocation that was to China, and that was mostly in portfolio types of investments. And so this is one of the challenges as we think about national
security going forward. One of the things I've advocated is we need to make sure that investors are not investing of any kind, are not investing in companies that support the Chinese military, support the PLA support the Communist Party, and the government should take a much more active role, and I've said this in testimony and so forth, to identify which companies we do not want American investors or
American companies to invest in. And that's one of the things I'd be advocating as a senator, as well as decoupling in key industries that are going to be absolutely
critical to America's economic and national security going forward. So that's the vision that I've laid out, and I think what's going to be required, and I honestly think my experienced with China, both as a national security official but also as a global CEO, is going to help me be much more sophisticated in how we deal with the Chinese because I actually know what I'm.
Talking about, Dave.
To that end, I want to get your view here on the tariff policies put forth during Donald Trump and his pet presidential run. There are a lot of mainstream economists, including Larry Summers, concerned about the inflationary impact that such policies could have. Do you share those concerns?
Well, Listen, I was someone who has been generally skeptical of tariffs, but when President Trump came into office, I thought that selective use of tariffs to ensure a fair playing field, insure reciprocity, ensure negotiating leverage made sense, and so I supported the tariffs the President Trump put in place under the last administration. And I do think that there's the risk of inflationary impact. And frankly, I think there's two dimensions of present Biden's policies which are relevant
to this. One is the enormous spending is the primary driver of inflation. That and the policies that are directed on reducing oil and gas consumption, those are the primary drivers of inflation, and economists like Larry Summers have said
as much. The second problem with those policies of the Biden administration, particularly as it relates to evs and solar panels and so forth, the policies that have been in place have made us ironically highly dependent on China, because seventy percent of the lithium batteries and eighty percent of the solar panels are manufactured in China. So in one fell swoop, in my opinion, the Biden administration's economic agenda has driven up inflation and made us more dependent on
our primary adversary. And that's why as I've run for the Senate, I've advocated set of policies that take us in the opposite direction.
Let's put a finer point on this, Dave.
The idea of tariffs here against China will put aside for a second, because Donald Trump is also proposing and across the board, a global ten percent tariff that he says would help to pay for tax cuts if he's reelected. This has been a big debate, as I'm sure you well know in Washington over the past week or so. It's about to get a lot louder making permanent the twenty seventeen tax cuts that are set to expire next year.
We saw a new analysis from the Committee for a Responsible Federal Budget says that would cost in excess of four trillion dollars, that it could add that much to our deficit. So if it's not tariffs that offset the cost here, how do you pay for it?
Well, first of all, you got to pay for it with a growing economy that's generating tax proceeds. The best way to do this, and in the Bush, rather the Trump tax cuts, if President Biden's reelected and those tax cuts are allowed to fire. That's going to hurt all Americans. So if you look at someone who's making seventy thousand dollars a year, the impact on them is something like two thousand dollars of tax reduction benefit that they lose. And this is the the.
Impact of inflation is pretty great on a household as well. Right, how do you find four point six billion dollars I think is the number that they put down your to pay for that without stoking inflation even further.
Well, the inflation has already been stoked by six trillion dollars of incremental spending under President.
Biden year, so you'd add another four No, no, no.
The primary driver of the inflation we had has been the spending policies of Biden and Republicans and Democrats have been spending too much. I'm not saying this is solely Democrats, but what's happened under Biden is six trillion dollars of spending.
And if you think about the types of spending, you can talk about one hundred and seventy billion dollars of loan forgiveness, which is absolutely, in my opinion, an un American and unfair, or you can talk about tax cuts that are going to benefit all Americans and all Pennsylvanians. And absolutely inflation is the most regressive tax at all. So we've got to get inflation under control. But the drivers of inflation are bad energy policy. They've driven up
the prices of fuel and too much spending. And so I would say reversing certainly some of those Biden spending bills and rolling back the war on natural gas and fossil fuels is the key to getting our economy back in check. And I wouldn't, particularly now, when so many families are burdened by this inflation, I wouldn't burden them further by rolling back the tax cuts the President Trump place.
Speaking of burdens on families, you know, when you think about the deficit issue largely in the US, doesn't mean that you've also ruled out the idea of more spending or slow and spending rather on Medicare and Social Security doesn't be part of the solution in closing that gap.
Well, I think the primary thing we need to do now is roll back some of the spending that President Biden has been in place. Again, I keep pointing to it because it's such an obvious one is the one hundred and sixty eight billion dollars of most recent student loan forgiveness. I mean, look at that, it's extraoriny. That's the size of the army's budget. That kind of spending doesn't make sense to most Americans. So we've got to roll back that spending. We've got to attack a number
of sources of discretionary spending. And certainly when you look down the road, there's questions around entitlements, but the basic premise there you have to start with this. We have to live up to the obligations that we promise people. And so it's you know, it's a balancing act for sure, but a pro growth economic agenda that deregulates that allows businesses to grow is going to be the primary driver of driving tax receipts. We've got to drive back or
pull back on spending. I certainly agree with that, but the starting point has to be the war on oil and gas, which which has hindered us dramatically, and some of the priorities which I honestly think are indefensive. One the most notable one is the student loan forgiveness.
Well, we should note I realized that you're speaking in some cases here about the moratorium on new LNG permits, but the United States is pumping more oil than it has ever in history right now. Dave, I want to ask you about your policy or your proposals if you're elected on Israel. I'd like to get to Israel if we can here to try to get to as many
topics as we can. Dave, there are a lot of questions about whether we're going to see a cease fire at any point soon, and I wonder if you think that Israel should declare war on Hesbolah, if that is in fact the mission here for Israel to combat the influence of Iran proxies. Iranian proxies that have brought so much terror to Israel and a very difficult quagmire that we find ourselves in now.
My wife and I went to Israel right after Christmas and saw firsthand the horrible Barbara that happened October seventh, and are fully supportive of Israel doing what it must do to eradicate Hamas and destroy that threat. I'm not going to comment on what Israel should do in terms of dealing with Hasblid much more confidence in their ability
to decide what's best for Israel as a democracy. What I will say is that they are absolutely being attacked from all sides by these proxy that are underwritten by Iran and the original sin. The thing that put us in this position was President Obama's deal in twenty fifteen to give back one hundred million dollars of sanctioned money, and the deciding vote on that was Bob Casey and
my opponent in the Senate race. And that money is being used to underwrite terrorist groups, the UTIs, has Belazlami ji Hut and of course Hamas, and We're gonna have to deal with that. Israel's gonna have to deal with that. And a final point, this is not just a war against Israel. This is very much directed at the West, and sadly, it's raising the risk for Americans around the world and in the Middle East.
Yeah, let me guys ask you this from another angle though, Dave.
As we wait for a.
Possible ceasefire, and you look at the destruction that has been wrought in Gaza, more than thirty thousand civilians killed according to the Gaza Health Ministry, at what point is the response disproportionate?
Yeah, well, listen, I obviously watch the same clips you do when you see human suffering and innocent people injured or killed. It's heartbreaking. You know, the source of this pain is Hamas that has integrated itself into the civilian population. Their explicit strategy is to increase civilian casualties. And Israel certainly has every right to eradicate the risks that destroyed the lives of twelve hundred Israelis, and you know, hopefully we're going to be able to find resolution on that soon.
I think it's very difficult to imagine Israel letting a military capability can continue with Hamas, and so I'll leave it to them to figure out the best timing and path for that. But obviously I was very gratified to see all the efforts that are being put in place to allow humanitarian corridors, to allow as much humanitarian support as possible into Gaza. And it's absolutely heartbreaking to see not only what happened on October seventh, but to see
innocence killed in Gaza. But make no mistake, the root of this, the root cause, the source of this evil, and the culpable party is Hamas.
Dave. Before we let you go here, I do want to get your thoughts on the US election this cycle here, especially because you yourself are also on the campaign trail and going around the country looking for fresh donors, new fundraising.
What is it.
About Donald Trump that Wall Street finds attractive at this point, because we know that even those who have shied away after January sixth, some of them have come back in the fundraising circuit. What is it that they're latching onto.
Well, I think the primary thing is that the country's just going in a really bad direction, and most Americans see it. So the economy I talked about, there's certainly positive economic factors, but for sixty percent of Americans, they're living paycheck to paycheck, and compounded inflation is really driven higher prices have really made it much harder for them to make ends meet. You see it with the border crisis, ten million illegal migrants coming into the country, a huge
national security risk, a huge fentannel risk. You see this in the which we just talked about, the war on oil and gas, which is particularly a big deal for Pennsylvania and many states across our great country. So I think the policies of President Biden are taking us in
a terrible direction. And I think that people compare the policies of President Trump with the policies of President Biden and say, you know what, we were better off and our future was much brighter under the leadership of President Trump. I think that's what's happening. That's certainly what's happening on
the ground in Pennsylvania. And I'm running as someone who's an independent voice, be someone who will fight for the fight for the interest of Pennsylvanian someone who's led in the military, created jobs in Pennsylvania, led companies, and someone who can get into the Senate and make a real difference and be a real advocate for policies that help Pennsylvanians.
We have to leave it there. Dave McCormick, Republican candidate for Senate in Pennsylvania. We thank you for your time today.
You're listening to the Bloomberg Balance of Power podcast kens just Live weekdays at noon Eastern on Apple car Play and then ron Oro 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 fascinating conversation and a taste there of our back and forth today with Dave McCormick. I'm Joe Matthew in Washington alongside Kaylee Lines. That Senate race is going to be one that decides the balance of power in the United States Senate, and it also happens to be one of the most important swing states for Joe Biden. It'll be interesting to see how the top of the ticket argues potentially with what's below it.
Yeah, how much split voting you actually may see come November. Of course, we still have a long way to go before actual election day. In the meantime, the country tomorrow is getting ready to mark Juneteenth. This, of course, became a federal holiday just three years ago in twenty twenty one under the Biden administration, commemorating the end of slavery in the United States. It has been one hundred and fifty nine years tomorrow since that day, and we wanted
to have an important conversation now with Hillary Shelton. He is National Advisor of Governance and Policy for the NAACP, and he is joining us here in our Washington, d C.
Studio.
Hillary, Welcome to Balance of Power. Thank you so much for being with us. Of course, a lot of progress was made to get to juneteenth. Certainly there has been progress made in one hundred and fifty nine years since, but there are also areas in which more progress still needs to be made. As we get ready to mark June teenth tomorrow, what is your view of how far we've come and how much further there is to go?
Well?
I think as we're talked about how far we've come, it's important to recognize that we want to make sure that it's clear that is that as a society and a country, that we recognize what had gone wrong and that we moved to do the right thing in the
right direction. Even as we recognized the nineteenth as June teenth, we know that the Emancipation's Proclamation, so to speak, was actually something they had to roll out and work its way to Texas, and it wasn't until it got there that we were actually able to fully recognize, with support of the new government of our country, that much more needs to be done. But we've accomplished an awful lot by being able to eradicate and recognize how awful slavery was.
As we're looking ahead, we're thinking about things to make sure that it still lives up. We know that even as we were recognized the end of slavery, we still had to clare with the constitution meant to as the term was ues, even those of former servitude, that is, those who had been enslaved in our country and other
people as well. There. It's amazing how the impact of slavery economically hit so many different places, in so many different ways in our country, and eliminating that awful scourge was something moved us forward and unified us even greater as a nation.
Well, you go back three years to Kailly's point, to where we were as this became an official federal holiday. Markets are going to be closed tomorrow. It's pretty remarkable achievement. But go back another year, four years ago to the death of George Floyd that was critical mass leading to this holiday, and we've seen a lot of promises made then not kept when it comes to DEI policies, when it comes to investments that many major corporations promised to make.
How important is it to go back three or four years to those initial promises and that feeling that this country had to remind ourselves of what's important.
Well, it's extremely important.
It's extremely important that we gauge the improvements that we make are quite frankly, where we fall behind and the promises made, and we were.
Disappointed what has transpired in a lot of ways.
Yes, there's so many things that still should be done, so as much as it hasn't transpired, hopefully we'll learn from our mistakes of the fix that wasn't taken and what needs to be done to make sure we live up to those promises.
That is, when we watched George Floyd.
I think one of the reasons so many Americans were so outraged that we saw what was happening. Perhaps new technology added quite a bit to us sing what was going on and watching this man literally being assassinated on the streets in our country and whatnot for no good reason. The police were overly a grubbed or overly violent. It
was a big problem. We'd put TV cameras on police offices, body cams as we call them, and whatnot, but they still didn't meet the need of our communities to make sure that there's oversight that very well people's rights are protected as we move and the important role of our law enforcement officials and being able to secure those things, and even the trust between those who live in our country and those who work for our governments.
What about the role of the people who make the laws, as there are members of Congress who are sitting in those halls now who are actively pushing back against the entire notion of DEI of things like affirmative action. What do you still hope to see from Congress?
We hope this said.
Congress began with continuing to analyze the data as we move ahead, being able to know what the numbers are and see where we've continued to move ahead and fixing these problems or whether we've fallen behind. In so many cases we've seen that as well. George Floyd was a falling behind because George Floyd came after Ferguson Missouri. It came after so many other cases along those lines. We thought in each of these steps we'd fix the problems, and clearly we have it. So so you think about
what needs to be done now. We need to recalculate those laws and actually repair them where we need to repair them, fix them and improve them, change them, in some cases, replace them so we have the great laws that we can enforce that actually lead up to the kind of support we want for our constitutional rights, so eco protection and equal opportunity under law. We to make sure we continue to gauge those issues along the SNES. Even if we think about hate crimes in our country,
we still have to calculate the data. That is, we've passed something called the Hate Crime Statistics Act first to show that the data very clearly indicated that we had a real problem with hate group activity, hate violence because of race, gender, ethnics and other changes and so forth, and it's something more needed to be done, and in
essence we began pushing that direction. We then pass the Hate Crimes Prevention Act, which included the data and the necessary resources to be able to accurately collect the data. One of our big challenges now is that we have jurisdictions that simply don't want to recognize that the crimes that are committed are indeed hate crimes, and indeed the commitment of a nation to actually emanate those hate crimes.
It's something we would work towards doing.
And once we were very clear there's still a problem, so we have a lot to do.
You talk about the fix that wasn't taken. That's a great phrase.
When we go back there and talk about some of the things that you just said, some of the promises that were made three and four years ago, we've actually seen progress on the state level with things like body camps, to your point, banning chokeholds, no knock warrants. That's all been done on many cases on the state level. Is the federal government then and Congress the hindrance to getting further progress.
Well, I would say that that they are major contributors to the problem, because we do still have local and state problems with the implementation of any of these programs as well.
Sure did very well.
As we think about law enforcement officials, police officers, those are basically controlled at the state and the local levels the federal government oversight. As a matter of fact, the Justice Department does a lot more to accurately collect that data than some of the jurisdictions that are wanted to protect. Whether it's there are tourism programs and whatnot that who wants to go to a city or a state that we know participates in racial violence or other things along
those lines. So they don't want the data to come out sometimes, but you can't repair the problem if you don't have that data. We can't do it right to make sure everyone is protected along those lines. So being able to do what we do at the federal level is important too. So let me just say, nobody gets
a break. We need to make sure the federal government, the state governments, and the municipalities are all actively involved in working together in coalition to be able to address these problems and fix these issues once.
And for all.
In our final moment with you, let's talk about the head of the federal government. The next US president obviously is still an open question. What is at stake for people of color in this election depending on who ultimately wins.
Well, if you think about the issues that impact us the most, the question that if you have to ask of any candidate this running is where do you stand on the issues? As we've seen the agenda of mister Trump and the agenda of mister Biden. Let me first say, the NAACPS and nonpartisan organization that does not endorse political candidates our political parties, but we do pay very close
attention to the details and the policy itself. So the question then is, as we think about why it is we don't have more African Americans going to colleges and universities and being able to become professionals because in many cases they can't afford it.
Who's going to help us.
With those issues and what I actually think about things on those times, whether it's student loans, whether we're talking about grants, Well, let me just say that mister Biden has indicated and has shown actually through his actions, that he recognizes that problem.
Let me put it this way.
You're sitting next to a guy that barely made it through on student loans. Though both my parents went to college and very well, being able to raise the money to get that good, high quality education really took a lot of doing. It's not just education. We have to talk about criminal justice the same way, and so many other issues that affect all of us in our daily life.
Hillary Shelton, what a pleasure to have you with us here at the table in Washington. Come back and see us again on this day before Juneteenth. From the NUBACP, I'm Joe Matthew with Kaylee Lyons on Bloomberg.
You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon Eastern on Apple car Play and then Froudoto with the Bloomberg Business app. Listen on demand wherever you get your podcasts, or watch us live on YouTube.
Here in Washington, where we're very interested in what's happening today across the river in Virginia as its primary day, and there's one rece in particular. We're watching Bob Good, the incumbent, the chair of the House Freedom Caucus, against his challenger, John McGuire, who is backed by Donald Trump. But if you take a look at Donald Trump's true social posts within the last twenty four hours, Joe, one of them reads, this is the beginning. Bob Good is bad for Virginia and bad for the USA.
That's pretty simple.
He held a tell a rally from McGuire last night, said more things about Bob Good. Quote, if he's reelected, he will stab Virginia in the back, sort of like he did with me. And that's where we start our conversation with Mick mulvaney, co founder of the Freedom Caucus, the group the Caucus that Bob Good now leads, A former acting White House Chief of Staff and the Trump administration. I could keep going, former OMB director. He's held half
the jobs in Washington. Nick Mulvaney, Welcome back to Bloomberg. How are you looking at this settling scores or a new fissure between Donald Trump and the Freedom Caucus in the House.
Joe and Fairness a lot of more jobs than nobody else wanted, so that doesn't really count the sadly, listen, politics makes strange badfellows.
It just does, right.
I don't have any personal insight into the Trump support for the good challenger. I obviously do have some on the McCarthy angle there, And curiously, even more interesting to me was Warren Davidson this morning, a sitting member of the House Caucus, actually came out from MacGuire over the weekend. So clearly there are things happening within the Freedom Caucus that we don't hear that much about. There is has been some discussions about whether or not they've sort of
strayed from their course or not. But it also could come down to just friendships. McCarthy's certainly not a friendship. McCarthy wants goods head on a platter. He did not get in it Nancy Mace's last week here in South Carolina. In fact, Nancy cruised to an easy re election here in South Carolina, which I know stung Kevin a good bit. So Kevin would love to get at least one scalp, and with Trump on Maguire's side, Good might be that one scalp that Kevin can claim.
So, Mick, as we think about how that changes the dynamics within the House Freedom Caucus, as you say, even a member of that caucus coming out against the chair this weekend, would that actually be a catalyst for a reabsorption, if you will, of the House Freedom Caucus with the rest of the Republican Conference considering started to see a break among conservatives in some sense, with that group and then the larger one.
Bailly, you know, I've been looking for that, and I've not seen it yet. I've been looking for that now for eighteen months. I was looking for a little bit of it during the during the Trump administration, when I thought that the Freedom Caucus would come down more on the fiscal tightening that they did. They weren't nearly as fiscally tight as I thought they would be. They were much more pro Trump. So I think they're probably staying there.
Here's what's going to happen, I think is that regardless what happens with Good, the Freedom Caucus will re coalesce around Donald Trump on the back side of these primaries, which you're probably seeing are some family squabble, some personality issues, and not really big macro trends within the caucus.
Abigail Spanberger's seat opening up as she runs for governor, Mick and I wonder your thoughts on Eugene Vinman, the retired Army colonel, of course, became a household name in his role as a whistleblower in Donald Trump's first impeachment. I live around here, and every time I turn on the TV, I see a vinmin ad. I mean, you literally just cannot hide from it. There are pictures of him,
his family. It's it's been an endless stream of TV advertising as he raises a boatload of money here I think it was five million dollars and he's got something like six opponents. What's your thought on the role that he could play here in congressional politics?
Can he win this seat well?
In Virginia? Right now? The answer is sure, anybody could win. I've seen some data that says that says Trump is neck and neck with Biden in Virginia. Now I don't I don't believe that that. You know that just that doesn't feel right, But the poll was there was a halfway decent poll, and it was after the conviction in New York City. So I don't know what's happening in
Virginia at the local level. Well, Vinman doesn't surprise It doesn't surprise me that he's he's doing what he's doing as well as he's doing it.
He was.
Look, you want to talk about getting personalities involved. I'm absolutely convinced that that's what drove a large part of his involvement in the first impeachment, so that.
He wanted to run for Congress.
Absolutely, he was a publicity hound. I'd never heard of the guy before. No one had ever heard of the guy. But he's trying to the phone call. That's like, but just goes to show you who's on the calls. I wasn't even on the call. So but anyway, that's going back a couple of years. Look, Virginia is an interesting place right now. The Democrats are losing ground in the rural areas. You guys live there, you know it. It's probably more bifurcated than any state in the nation. You've
got two states. You've got sort of the northern Virginia suburbs, and then you've got the rest of the state. And it'll be really curious to see whether or not these primaries are any sort of bell weather going into November, and whether or not these numbers you're seeing the shows Trump pulling closer to Biden or anything close to reality.
Yeah, this Virginia thing keeps coming up. We know that Donald Trump raised it and his meeting with House Republicans here in Washington last week. Lawmakers who were in the room told me he's looking to spend money in Virginia, also New York and New Jersey. I guess we have to consider whether we need to expand our understanding of what the battleground states actually are. But Mick, while he
was in Washington, he wasn't just talking to lawmakers. He also had a meeting with the Business Roundtable and a number of high profile executives. The scuttle butt is a lot of them walked out of that room feeling a little bit disconcerted about what Donald Trump was saying and
maybe the manner in which he was saying it. If you're an executive right now looking at this election, should you more welcome the idea of some of the policies a second Trump administration would bring in terms of tax relief and deregulation, or should you be concerned with the idea of the general uncertainty, it could bring.
A couple of things. I do put some weight on the first hand comments that some of the CEO's made. Let's talk talk about that a second. To answer your question, A lot of the scuttle butt comes from some of the reporting that somebody from a different network, a different financial news network that I'm familiar with and do occasionally came from. And I can assure you that that person is no big fan of Donald Trump.
I read the accounts. I didn't see in the video.
I don't think there was any video, and it sounded like every other CEO meeting I've ever had with Donald Trump. Was he wide ranging? Was he going from topic to topic?
Yes?
Was he disjointed? Yes, That's every single meeting that every CEO has ever had with Donald Trump. So I'm not sure why people say they were surprised by this. I didn't hear anything that was any different in twenty seventeen, twenty eighteen. So if I'm a CEO, what am I asking myself? Okay, I've never liked that. I'd never liked the package anyway. But let me look at the policies. Let me look how it was for business. What is
Donald Trump really believe in. He really believes in tariffs, he really believes in deregulation, and he really believes in a simpler tax code. You know, if you're a corporate ceo, goodness gracious, if you're an ordinary person, that might be compelling. Look, there's a lot of folks who don't like a stile. I struggle with a style from time to time. We've
talked about that. But at the end of the day, I think the CEOs are looking their hands over and say, this is a choice between Biden policies in Trump policies, and I wouldn't be surprised that they come down on Trump's sign.
We talked to David McCormick last hour, running for the Senate in Pennsylvania. Republican asked him about Donald Trump's proposals for tariffs and making the twenty seventeen tax cuts permanent.
How to pay for them? The question here.
He basically said, you pay for these through growth. And I know that Donald Trump has taken a couple of stabs at this including offsetting the impact of tax cuts with higher tariffs. But the issue of deficits not going away here, Mick. We're not talking about reforming Medicare and
social Security. We're not talking about pronounced spending cuts. So are the CEOs in that room only concerned with the immediate term here cut red tape, cut taxes or are they worried about the long term corrosive effect of deficits.
You've asked a bunch of questions of the cynic and me will tell you that they're just interested in the short term balance sheets at the p and LS. I hear Jamie Diamond talk about the threats of the deficit, but he was one of the largest voices for stimulus in two thousand and eight, nine and ten, twenty, nineteen, twenty twenty. I get it. But welcome to the party, is all I can say is that, you know, been a lot of folks in Washington worried about the death
for a long time. Glad to have some big names along for the ride. On the tariff plan for taxes that one. I don't don't put any credence in at all. The idea of raising tariffs to get rid of the income tax. That was a throwaway line. It takes you. I've talked to the policy people inside the Trump policy team. None of them have mentioned that that specific proposal to
me in my many conversations with him. I think it was an off the cuff for Mark designed to sort of measure out where people how people felt about tariffs. Besides Joe Kayley, if you do the math, it doesn't work. Income text chairs just north of two trillion dollars a year. We import about four trillion dollars a year. That's a fifty percent tariff on a static basis. But of course if you put a fifty percent tariff on something, you probably import less, So you're not going to generate that
two point two. It's a it's a it's a it's a it's a cycle into disaster. Yeah, So this math doesn't work on tariff's replacing INGRAM taxes. But tariff's are real, and he's serious about extending the tax cuts. He's serious about taking the corporate text right down from twenty one to twenty. He always wanted twenty in the to begin with, back in two thousand and seventeen when they cut the original deal. So that's going to be a priority for him on day one.
All right, Mick mlvaney, former acting White House Chief of Staff, former O and B director, founder of the Freedom Caucus, former congressman from North Carolina or South Carolina, rather too many titles, Mick, thank you so much for joining us. We want to get an economist's view now on what we just talked about with Mick there, and bring in Kitty Richard. She is Groundwork Collaborative senior strategic advisor who
is here with us in our Washington studio. So, Kitty, we also want to talk to you about the retail sales data that we got today, which was a lot weaker than expected. If we could first begin though, with what we're all talking about here in Washington as of late, higher tariffs in exchange for lower taxes. Does this make any economic sense in your mind?
Thank you so much for having me on. You know, I actually rarely find myself saying that I would agree with what mcmulvaney just said. But I don't think that we should take former President Trump seriously when he talks about paying for getting rid of the income tax with higher tariffs. But I do think that we should really think about why he is throwing that out to test the waters, and what his real commitments are is cutting taxes for the wealthy and for big corporations. And that's
what we just heard. It's what we hear over and over on the campaign trail, and that's the part that I do think we really need to take seriously. And frankly, we have been experimenting with huge cuts to taxes for the wealthy and corporations over the last forty to fifty years.
At this point, they have not delivered for the American people, and that's why they're so deeply, deeply unpopular, and so any claims that this is going to be positive and grow the economy really are just more of the same failed trickle down economics.
If these tax cuts were made permanent, though, and there's no effort to offset them to pay for them. On Capitol Hill, what do you say to those Trump supporters who say it's about growth, that we will grow our way out of the deaficity.
Yeah, so, you know, the corporate side of the Trump tax cuts actually are permanent, and they were the largest part of the TCJA's revenue raiser or revenue losers, and they have completely failed to deliver the Trump administration. So on the individual side, I think again, the model of growth that is built on funneling more and more cash to the very wealthiest in this country has not delivered
for working people. It hasn't delivered for families. And I'd also like to talk about you know, we hear a lot of concern about the deficit. What I'm concerned about is using these huge deficits that have been entirely created by first the Bush tax cuts and then their extension, and then the Trump tax cuts on top of them, as justification for cutting the programs that families and seniors
rely on in their day to day economic lives. I think that is really really dangerous for economic growth as well as for the pocketbooks of ordinary Americans.
Well, when considering dangerous to economic growth, we know the consumer is the engine for that. And if you look at the retail sales data we got this morning, it would seem that there are signs that the consumer at the very least is slowing down, if not starting to crack in a more material way. It's not just the only tenth of a percent month on month figure that we got, but the downward revision from the month prior. Kitty, how concerned are you by the data we've.
Just seen come in?
So I'm concerned primarily because over the last year eighteen months, as the FED has pursued its rate hiking campaign, the American consumer has actually been surprisingly resilient and that has driven a strong labor market, had good spillover effects into wages. Those are all positive things, but it's sort of been a question of when that would start to pull back.
And this data, on top of what we're seeing with growing credit card balances and delinquencies, we're starting to see some stress on American families who have run through the little bit of savings that they were able to accumulate during the pandemic and are facing higher prices, especially on things like housing and childcare, where the Fed's not really able to bring those prices down, and in fact, those high interest rates are really taxing American families very directly.
Kitty, we just have a minute left. When you hear Walmart talk about affluent people trading down to shop at their stores as opposed to going out to whatever luxury retailer they might be used to, what does that tell you about where we're going to be six months from now.
You know, I think that the good side of that is that we should have retailers competing on price. What we've seen instead over the past eighteen months is prices going up and up and retailers really absorbing that and creating higher profit margins for themselves. So I like to
see that competition going. But what we really want to see is that competition leading to lower prices for all consumers, leading to higher wages for workers and for families to be able to get ahead on the things that really matter, like education and healthcare, childcare, housing. And so that's what I want us to focus on, and I think that's really what the FED needs to be focused on as well.
It's great to have you at the table. Thank you for coming to talk to us. Thank you from the Groundwork Collaborative. She's senior strategic advisor, Kitty Richard's many thanks for being with us today.
You're listening to the Bloomberg Balance of Power podcast kens just Live weekdays at noon Eastern on Applecarplay and then Ronoo 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.
Great to have you with us on Bloomberg Radio, on the satellite and on YouTube. It's Ballance of Power, the fastest show in politics, and we've covered some ground already this hour. We're not done yet with our eyes on the campaign trail, even though the White House probably would
not want me to be framing it this way. Joe Biden announcing today a streamlined path to legal status for more than five hundred thousand immigrants making his administrations brought us efforts so far to offer deportation protections, knowing that Donald Trump is promising the biggest deportation in the history of America. It's still unclear exactly on how that would work,
so we move to the democratic side of things. We talked to Dave McCormick earlier, the Republican Senate candidate in Pennsylvania. We talked to Greg Duo about the Trump effect on this primary day. We assembled our panel now with what's coming out of the Biden White House and the Biden campaign. With me in studio is Genie Shanzey, no Bloomberg Politics contributor. And Rick Davis is with us as well. Bloomberg Politics contributor.
Great to see you both here with some important stuff to talk about.
Genie, I'll start with you on this.
Joe Biden's been getting an earfull on the border, not just from Republicans criticizing him for being too light on the border, but from progressive Democrats who don't think he has done enough for legal immigration for Dreamers, as they call them. Does this help to quell some of that upset.
It should help to quell it.
I think what the administration is saying here is that we agree with Republicans and the American people that our immigration system is broken and has been for decades. We agree we need to strengthen the bord and we need to protect our border, but we also agree that our processes have broken down, and one of those processes is addressed today in this EO critically important, which is that if you are married to an American citizen, that there will be a pathway for you to be in this
country legally. And you know, I can just tell you, and I don't know your experience growing up. My experience in growing up in the US was that we were taught if you married a US citizen, you automatically became a US citizen.
That is not the case.
The case is you then apply and then in many cases are sent out of the country for ten years, and what that does to the children of people in this position. So I think they're trying to fix a very broken process and at the same time protect the border, and that is.
Very, very important.
And the polls show that the American public supports both of those things. So from that perspective, I hope it quells and it shows that the Democrats are taking a positive step to address this, whereas the Republicans have just been sitting there saying, we don't want to address the problem until our guy is in the office, and that's not the way we should run our policy.
Well, I'm glad the way you described this.
Under the policy that's being proposed here, eligible spouses and children of American citizens who have been in the country for at least a decade would be able to apply for lawful permanent residents without first being forced to leave the country, as Genie says, which is currently the case.
Rick, is this.
Good politics for Joe Biden or just another reason for Republicans to call them softs on immigration?
Yeah? I wouldn't get too in love with Genie's analysis. Somehow Republicans and Democrats agree on this, and I know that's not exactly what you were saying, but kind of the implication. Eighty five percent of Democrats, according to a recent pupoll, love this policy that Biden has just announced. You know, let them stay, let them work it out, go for citizenship while they're in the country. Once they're here,
they should be able to stick around. Seventy percent of Republicans think, no, this is not the law.
The law says they got to go, just like.
Genny said, and they should be deported, and they should be deported in mass if need be. And so it is a very very split issue in America. There isn't a consensus, certainly by Republicans or Democrats, or Trump supporters or Biden supporters about what needs to be done on this. So Biden is definitely leaning into his base on this. In his base is almost in unanimous support of this policy. I would say he was doing better a month ago when he announced through executive orders, you know, some curbs
on immigration once they hit a certain threshold. And so that was much more crossing the line of partisanship and giving Republicans a little bit of flavor that he can go both ways on immigration. But look, I mean, all of this is case by case. We need comprehensive immigration reform. None of this is going to fix the problem on
a small ball basis. But you know, I think that Biden administration probably felt like they did a good thing politically last month and wanted to follow up with more work on immigration this month.
Because that's the knock from the president's left here.
Right.
We had a huge debate about border security, but not about legal immigration, which the country needs, the job market needs to function. Is this the way the president is answering that?
It is in part the way he's answering it.
It's far from comprehensive.
It's far from it. And that wasn't his choice.
That was the choice of the Republicans, who, after negotiating a bipartisan bill which had widespread bipartisan support, it was not passed because Donald Trump said he didn't want to give Joe Biden a win. That left the President either doing nothing, which he's not comfortable with, or going ahead securing the border and trying to take steps to fix a broken immigration process as best a president can VIAEO. When Congress is doing nothing about it. I mean, I
agree with Rick. I think it's important we get comprehensive immigration reform. I wish the Republicans agreed and the Democrats and Republicans could come together and do that. I also agree with Rick. I like to spread the love, so you know, I like to do that as well. But where we are, the president has to not just be wishing for things that aren't there, but he has to act as best he can legally, and that's what he's
done here. But let's not forget the people helped by this order as long as it stays in place, are our friends, our neighbors, our coworkers, our colleagues. These are people in our country who have been here, in many cases for decades. Fifty thousand children who are here who should not be victimized by a horrible, horrible process that is broken at this point. So I think the president, and if it was Donald Trump, I'd say the same thing. Fix the process. I wish Congress did it, but they're not.
Rick.
The President's rolling this out today at a White House event commemorating the anniversary of the DHACA program Deferred Action for child's arrivals if.
You weren't there for that whole experience.
Are you surprised we don't hear about this part of the conversation any longer in Washington. Have Democrats lost the edge on this or has everyone come to agree that security needs to be handled first.
I think that there's a general consensus that politically, you need to be talking about border security first. I mean, the unregulated border over the last three years has caused a lot of displacement around the country, not just border states, but you know, Texas and Florida shipping immigrants to places like New York and Chicago, and you know, Martha's Vineyard has caused a great stir within the Democratic administration and voters, and so yeah, I think there's consensus that you've got
to get control of the border. And what's ironic is you've got sort of the least number of border crossings that we've had in you know, a couple of years happening right now. So border crossings haven't actually been a big problem in the last couple of months. You know, since December, I think we had three hundred thousand border crossings, and you know, this last two weeks, you know, a couple thousand, So that is I think one of the
top issues. Then you can play around with things like this, but DACA has been around for the longest period of time that has gone least address I know. I remember Lindsey Graham going into the Oval Office with Donald Trump trying to get DAKA fixed. I mean, it's the easiest.
Fix in the world.
It's a compassion issue, and yet no administration has made any progress on it, not Obama, not Trump, not Biden. It's it's a real failure of the political process to leave these kids behind.
There you have it from Rick Davis and Jeanie Shanzano.
By the way, I will mention a story on the terminal border crossings fall materially since Biden plan.
According to Allehundro Maiorcis, the Homeland.
Security Secretary, was here at Bloomberg yesterday and a really interesting take on the at least the infant stages of this new policy. Thanks for listening to the Balance of Power podcast. Make sure to subscribe if you haven't already, at Apple, Spotify, or wherever you get your podcasts, and you can find us live every weekday from Washington, DC at noontime Eastern at bloomberg dot com,