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As we cross into Saturday, the government set the shutdown unless something amazing happens here, following a weekend in which we saw more job boning, more commentary on Sunday morning television, but no progress really in negotiations around a funding bill. Everybody went home last Thursday and they're not going to be back till tonight tomorrow, when things get back on track. Interesting bit of polling coming out of Goldman Sacks a
survey from the Investment Bank. Small businesses worried about a shutdown. Ninety one percent tell Goldman it's important to avoid a shutdown. Seventy percent say their business would be negatively impacted. Ninety three percent believe their revenue would take a hit, even as lawmakers say, don't fear the shutdown. At least some of them some troublemakers at least, according to Kevin McCarthy in his Republican Conference. We're going to get to that
as well. But let's stick with the polling data and a perplexed Washington over the weekend based on the latest we heard about here on not only the Republican primary trail, but more importantly, a potential general election matchup. New York Times crunches them together into the headline. Polls show low approval writings for Biden and Trump coasting in primary. That would be fair, mister Biden faring better than mister Trump
when it comes to personal favorability. In this poll, thirty nine percent say they have very positive or somewhat positive opinion of him. Thirty five percent the same of Donald Trump. But it's that hypothetical matchup that freaked everybody out. In the Washington Post ABC News poll, a ten point blowout for Donald Trump over Joe Biden. An outlier say some certainly Larry Sabadeow, I don't know if you saw his take on this. We're going to get into all of
it with Eli Yoakley in just a moment. I have to pull up the Sabaeoa cut though, because it's quite remarkable from of course, the University of Virginia. Larry Sabadoah tweets ignore the Washington Post ABC poll it's a ridiculous outlier. My question, how could you even publish a poll so absurd on its face will be a lingering embarrassment for you.
How do you really feel? Separately? NBC News out with a poll shows President at fifty six approval, the highest in this poll, but again, fifty six percent of voters disapprove of his performance in the other We're going to try to make sense of this what people actually think of a shutdown and the impeachment proceedings they're about to begin this week in the US House right now with Eli Yoakley, politics analyst at Morning Consult. Eli, it's great to have you back on Bloomberg Radio and here on
YouTube our conversation. Thanks for turning your camera on. I hope everyone joins us on YouTube when they get a chance. What your thought about this before we move on to your own numbs, This idea of an outlier, This is part of the business that you're in when you're polling the American public. But do you think twice about publishing something that just appears to be from another solar system?
You know, I think a lot of people like the transparency aspect of putting out numbers. If you get them. I think we've heard of other polsters doing this. I mean, when you read the Washington Post piece on this, they were pretty clear about the outlier nature of this survey. I mean, most of the polling we've seen about this contest, this hypothetical matchup between Donald Trump and Joe Biden has
been pretty close. Sometimes one of them has a two or three point lead, usually within the margin of arabic you know, here, Morning Constant, We've been tracking this every day since early December, and the numbers just really haven't shifted much. It's been a tight contest. A lot of voters aren't tuned into this yet, and so you know, I think whenever we get a September a year out survey like this as an outlier, it might not be
time yet to light your hair on fire. Yeah, if you're a different right.
Well, there's a lot of hair on fire though already. And I wonder if you can just explain to our viewers and listeners here how you get an outlier. This has been a pretty reliable pull, it's considered high quality, a good sample. But sometimes people tell you things I've heard about projecting, for instance, or maybe the order of questioning. Do you buy into any of that?
Yeah, I mean sometimes it's just you get a weird sample, a weird set of voters that might look on paper like the people you're supposed to be talking about. But art you know that in survey research science they talk about confidence intervals. A lot of time there's a ninety five percent confidence interval that you could repeat this over and over again, but every once in a while there's that five chance that the numbers are off.
About that. Well, let's talk about what you're learning. That's why you're here, Eli, and your thoughts about this precarious week that we are just now beginning the idea of an impeachment inquiry. I know that you've run numbers on this, and we're going to see the first hearing in the US House open this week with the Oversight Committee. The chair, Jim Comer says, it's going to be more of a refresher to bring everybody speaking of baseline back up to
where we are. What do Americans think of this exercise?
You know, right now, the impeachment enquiry is pretty popular. About half of voters supported, forty two percent don't support it. A good number of Republicans Democrats think it's okay to open this investigation. I think some of that might be, you know, just do it to clear the air. But there is some dissatisfaction among the President's base with him generally. We've seen this in even some of our primary tracking, about two and ten Democrats would support the different candidates
in the race. You know, the Democratic support for this is much higher than the Republican support was for Trump's impeachment back in twenty nineteen. You know, people do see political motivation from Congress shocking, right, but it's a little bit less than the kinds of the share is He's is saying when it comes to Trump investigations.
Forty eight percent all voters, forty seven percent independence. That tracks pretty closely for what it's worth here. I wonder how these numbers might move once we get into the process eli to people care about whether there's hard evidence in this case, It's possible.
I mean, sometimes these we saw during the Trump impeachment investigation. These numbers move every once in a while. But look, the views on Joe Biden are pretty solid at this point. They're not great, and nothing has really made them worse, and nothing's really made them better, and so I think that Republicans are going to see a chance to do this. Clearly, this is something that excites their base. But you know a lot of folks just aren't paying attention to what's
happening on Capitol Hill right now. You know, we're less than a week from our government shutdown. In one in five voters say they've heard a lot about this. If folks aren't as a tune of this as people in Washington and our.
Well, tell me more about that, because we've got lawmakers in some cases saying that, you know, a shut down is a good thing. People are getting used to this, they think it's part of the legislative process. In many cases, we're obsessed with blame game here in Washington. What have people outside the Beltway think?
Well, I think we're much released pulling on this tomorrow, but the electric's pretty divided on who to blame for this. But they're just not paying attention. I mean, this is a major major issue for the economy. As you mentioned, a lot of business folks are very concerned about this, but every day people just aren't really tuned in. I think that goes that's helping the GOP obviously just given the dysfunction that is happening in Washington, you know, out
in the country. Since twenty twenty, the share of voters who say the GOP is competent to government has increased. It's almost tied with Democrats right now. We got this survey, you know, last week as this shutdown debate was you know, taking your stage. I think that is a key piece of evidence that folks aren't attune to this despite their prioritization and a lot of surveys of you know, reducing the federal deficit.
Spending time with Eli Yoakley at Morning Consult here on Bloomberg Sound On, I'm Joe Matthew in Washington. I do want to move to the campaign trail for a moment with you. I see your latest numbers from Morning Consult pro Donald Trump fifty nine. Ronda Santis is still in second place in this poll, but he's down to thirteen percent now, Ramaswami ten and Nikki Haley six. Mike Pence
rounds things out at five percent. Nobody else would make the debate stage from here based on this pole, Eli, is that the way we should be viewing this debate this week. They're out in Seeming Valley. This is going to be the biggest collection of candidates we see from here on out.
I think that's probably right. We're not seeing anybody. It's that three percent threshold that the RNC is set for this debate. So I think that stage is pretty well set.
You know.
The challenge here for the campaign is what is the point of this? I mean, Donald Trump is not on stage. He's backed by almost six to ten Republican primary voters. Without him there, there's just not a lot of interests among the Republican electorate. We saw Nikki Haley get a bit of a boost after the first debate that has sustained a bit. I think expectations are higher for her
at this point, but to what end. I mean, you're playing over a few points here and there at this point when it comes to the folks on stage, Donald Trump's absence has definitely taken away a lot of attention from some of the folks challenging him for the nomination.
So this is pretty rude of him not to attend these debates. We've only had one of them and we're already calling this a good idea.
Yeah, I mean, maybe I'll eat my words on Thursday morning, when something very dramatic and interesting and a campaign shuddering happened on Wednesday night. Possibly, But you know, I think his play to go out to Detroit stand with some working class voters who are a big part of his coalition. Maybe not the rest of the Republican candidate's coalitions, but
definitely is I think is a shrewd move. It's put Joe Biden sort of on the defense when it comes to his handling of union issues and this core group of voters the Democratic Party has been losing in recent years. Yeah, Trump, if you had sixty percent, would you go up on stage and let yourself get attacked by all these people? I mean, it makes sense, and I think he learned from the last one that it didn't hurt him.
He sure did learn that, and he's, I guess, holding by his word that he's not going to attend any of them, which would be quite remarkable until the general that's, by the way, when some people think Joe Biden will refuse to go to the debate based on what we already saw here, based on his legal challenges. Anyway, Eli, it's good to have you. Thank you for joining Eli Jokley, political analyst at morning Consults. Always a great conversation as
we assemble our political panel. Genie Shanzano is with us here on a Monday Bloomberg Politics contributor, Democratic analyst Gooin today by Lester Munson, Republican strategist and co head of the international practice at BGR Government Affairs. Great to have you both with us here. Genie, I think that we've established that number one. This debate will be I guess, entertaining, if not informative this week, but will not be moving the needle for a lot of voters because Donald Trump
is not there. This is a shrewd move on his part.
In your view, it is, you know, when you are leading by this much in the Republican polls, he is little incentive to go there.
You know.
The idea with debates is if you're leading, the most you can do is harm yourself. So it wouldn't make sense for him to attend. I still think it's an important debate because clearly we want to see who is going to be that number two. Should Donald Trump's numbers not fold nationally the way they seem to be, but particularly as we look in the poles where his margin
is much less significant than the national polls suggest. So for those reasons, I think the fight for number two is critical and the debate, as you mentioned, Joe, it's going to be entertaining either way. So I'm excited for Wednesday night.
This is going to be a wild week, Jennie. Before I bring in Lester and I want to give him a time on this. Do you see this Washington Post ABC News poll as an outlier? Is it junk as some suggest, specifically the hypothetical matchup that shows Trump ten points over Biden.
Yeah. You know, it's troubling that they've had two polls that they themselves describe as an outlier, and I wish they would give a little more context to that. So for that reason, I do think we want to put an asterisk around it. But I give the Post an ABC credit because they have been doing that. They drew attention to this. They put out the numbers and they said this may not be accurate. And as Eli was
just talking about, the confidence level is critical. You mentioned context effects, right, So many things make polls difficult to talk about in a thirty second news piece, and that's where we all have to be careful about overstating any lead either direction.
Lester, We'll have more time for this, but are you going to believe me or your Lion poll or what do you make of this calling your own survey and outlier.
Well, it is kind of an outlier. I mean, the average of all these polls shows a much more evenly divided race. So I think it's it's fine to call it an outlier. That doesn't mean it's wrong, and it doesn't mean it's an indicator of some changes we're seeing. So I think I think it's still a valuable poll and we should be paying attention to it.
Well, there you go with clutch analysis from Jeanie and Leicester. There were us for the hour. We're going to drill down more on the campaign as we had for the debate, what people think about a shutdown, what the likely outcomes are here, and just what's going to happen in Detroit this week. I'm Joe Matthew. This is Bloomberg.
You're listening to the Bloomberg Sound on podcast. Catch the program live weekdays at one eastern on Bloomberg Radio. The tune in alf Bloomberg dot com, a Bloomberg business app. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa play Bloomberg eleven thirty.
Well, call it an outlier if you will. But the new poll that we're talking about from the Washington Post ABC News does have some content some results here that are consistent with what we've seen across the board, and that has to do as well with age more often a problem for Joe Biden. He would, of course, as we're reminded by the Post b eighty two. At the start of a second term. Overall, seventy four percent of adults say Joe Biden would be too well to serve
another term. Fifty percent say that of Trump. I believe they're only what four years removed. Joe Biden knows this, as he made clear in his speech last week.
A lot of people are focused on my age. Well, I get it, believe me, I know better than anyone. But there's something else I know.
Well.
I came to all this nation was flat in.
US back I knew what to do.
I vaccinated the nation and rebuilt the economy. When Russia inveni Ukraine, I knew what to do. I rebuilt NATO and brought our alliance to rally the world and above all, when democracy was saying I knew what to do, but you know what, I wish I could say the threat to our democracy has ended with our victory in twenty twenty.
But it didn't.
Our democracy is still at stake. Don't kid yourself.
So we have more work to do.
You and I.
So that's the pitch. Let's reassemble our panel for their take on this. Genie Shanzano is with us. Of course, Bloomberg Politics contributor and Democratic analyst Lester Munson is here as well, Republican strategist at BGR Group. Genie is not going to do it for you? Is that the argument that Joe Biden just laid out there that will carry him to win another election?
Yeah?
I mean I wouldn't say that's it, because the polls aren't looking as if he can just rest on his laurels.
But when it comes to the age issue, though specifically on the ash, yeah, you know.
You know. One thing I have to say is that when you listen closely to Donald Trump, and he has been asked in the Megan Kelly interview for instance, recently about the age issue, he does go there the way some other folks do, because he knows, to your point, he's about three years younger than Joe Biden, so it's not a particularly effective argument for him to make. What he does try to say about Joe Biden is that
he's corrupt, he's crazy, he's incompetent. But you know what this is somebody who over the weekend was calling for the execution of Mark Milly. This is somebody who is saying he's going to take over media outlets and shut them down. He's going to shut down the federal government. All Senate Dennivercrofts should resign because of Menendez. The list of crazy from Donald Trump goes on and on, and he puts it out there himself. So I think what Biden needs to do is to accept the age issue.
Nothing he can do about that but focus in very very carefully on the craziness and the chaos that is Donald Trump. He beat him in twenty twenty. He can do it again, but it is going to be a tight race either way. But that's what I think he has to do, because again, Donald Trump isn't focusing on age, He's focusing on other issues that Biden has a clear response for.
We just got a breaking news headline that I need to hear from both of you on here. Lester, your thoughts on this. We're hearing from Moody's. And this was one of the first thoughts I had this morning when I woke up, is this is this another downgrade that's coming here? If we're walking into week after week with no path in sight and a government shutdown widely expected, isn't that the point here? Moody says a shutdown would be negative for our credit rating? Lester, is that going
to be the next chapter here? Is that what might motivate lawmakers to find a path?
I don't think so. Moody's has done this. There have been threats of these downgrades before, and actual downgrades before. I'm not sure it really changes the behavior of politicians.
I think Republicans see, of course, the chaos and their own party, but they also see that voters are about as likely to blame Biden and the Democrats for the chaos as they are Republicans, And so I think there's not there's not There's nothing dispositive here that's going to push the fiscal conservative rebels into a into a different spot. Short of working out the math on the budget that they find acceptable.
It's just the endless threat of shutdowns the fiscal cliffs though, right, Genie, this is what we heard from Fitch when we did get a downgrade the first of August. Nothing's changed. You could argue it's been actually getting worse. I mean, if you consider what's happening now, I wonder if we could actually avoid a default if we have the same set
of circumstances. I'm amazed that we got through that. Based on what we're seeing this week with Kevin McCarthy not even being able to get bills to the floor for debate. Are we set for another downgrade?
This has been my fear all along, and we've talked about this, and I think that Fitch statement when they downgraded was so clear and should and I agree with Lester it won't, but it should impact the thinking of every reasonable person in a position of power to avert a shutdown. They made the case that if you can't do the basic act of governance, if you can't simply keep your house in order and budget in a reasonable way, how can we say you are a safe bet.
You're not.
And that's the fear here. They should listen to this statement by Moody's and I am glad Moodies put this out, by the way, because this is the reality we keep hearing from Republicans. Oh it doesn't matter, shutdown doesn't matter. Nobody will feel it, nobody will even know. Yes we will. This is troublesome and chaotic and problematic. It'll impact all of our lives. They don't care because they are trying to do the bidding of Donald Trump. This, you know,
Caluk is of conservative chaotic people. But the rest of us who are thinking Republicans and Democrats and moderates and independents should care because it is bad way to run your house wherever you live, including the US government.
Lester, I'd like to hear from you on what's going to happen in the next few days. You're speaker McCarthy. This is yesterday, CNN gets him in the hallways or on his vest on a Sunday, got to go to work again, and a you know, potential shutdown weekend. We was talking here is CNN reporter asks me about the holdouts periods.
Well, if you're holding out now, you're trying to get a person into a shutdown. You've been stopping the bills from ever coming up. I don't know how you stand up and then say, well, he hasn't brought him up. The only reason they haven't come up. They've been now a committee, people have read them. I've been asking for amendments since back to July, so we can bring them up. But if you can't pass the rule, it's hard to
bring it up. It's almost that they want to walk you into a shutdown then blame me for the shutdown.
It doesn't make a lot of sense to me.
Doesn't make a lot of sense still to him, Lester, how about you, what do you think is coming?
Well, let's just get a little grounded here. Being the leader of the House Republicans is not an easy job. They do not take These folks do not take direction. They don't like group activities. They want to go their own way. It's like it's hurting cats. Pick your metaphor. These folks are hard to get all in the same place at the same time. And Kevin McCarthy knows that.
And there's I think we're gonna look at a shutdown here for at least a few days, and there could you know, the most likely scenario is probably working out some sort of compromise on the spending issues in the late of night, and people are tired and exhausted and finally cave in and agree on the path forward. I will say one thing on behalf of the rebels here, and I am slightly sympathetic to them. The fiscal situation of the US government is terrible. The budget deficit at
two trillion dollars is at an absurdly high level. And while their solutions may not solve the issue, they are motivated by what they see as a crisis in US government's federal governments spending, and they're not wrong. There is a big problem that needs to be addressed. Their solution may not quite get us there, but at least that's
what they're talking about. It does seem like that sentiment is going to get more and more traction going forward if we keep if we keep on seeing things like a two trillion dollar budget deficit when we're not really doing surplus emergency surplus spending to fix the economy because of COVID. This is just this is mostly a h a regular federal government budget that has a two trillion dollars deficit. It's it is alarming.
It's and that's a that's an important point, Lester. Of course, we're not going to get to that until we really start dealing with the budget as a whole. We're still nibbled around the edges in this conversation. We can and figure that out. The question is, though, is the Senate gonna come to the rescue this week, or, as some would say, will the Senate jam the House? I guess it depends which chamber you're in, but that could be the case. It is possible they're going to come back tomorrow.
I'll have five days to work on this and we'll pick it up next with Jeannie and Lester here on the Fastest Show in Politics. The headline though, on the terminal government shut down negative for US credit rating. We just heard from Moodies. There you have it.
You're listening to the Bloomberg Sound on podcast. Catch us live weekdays at one Eastern on Bloomberg dot Com, the iHeartRadio app, and the Park Business. We're listening on demand wherever you get your podcast.
We've got to eat our whaedis here. You see what's coming up this week? You get one more night of rest. Yeah, everyone piles back in. Of course, lawmakers back in town tomorrow, potential shutdown end of the week. But before that, we've got a Republican presidential debate. We've got our first impeachment hearing in the House. Yep, we've got a guy named Joe Biden, another guy named Donald Trump visiting the picket line in an historic strike that continues to this moment.
Yeah, Biden up first tomorrow, joining workers on the picket line, which we think is the first president in history to do so, quickly followed thereafter by Trump in Detroit simultaneously, with that debate happening on Wednesday. Thursday's the impeachment in quiry Friday. We're really just going to be racing against the clock because the strike the clock strikes midnight on Saturday, and then it might be game over for at least a little while for the US government.
Yes, so we're spending the program today setting the baseline for everything that you are going to experience. We'll do this together, of course, over the course of the weekend. We need to start with Jack Fitzpatrick of Bloomberg, govern Our Congress whisperer. Here are appropriations expert who I can only imagine it has been rather busy even though there's not a lot going on in town here. Jack, it's great to see you. We're hearing talk about a couple
of different things here. You've got a continuing resolution that may come from the House or the Senate depending on how this week goes. I'd love your thought on this, whether that in itself in principle gets Kevin McCarthy fired or prompts someone to try to fire him. And then the idea of getting I believe four appropriations for spending bills he wants to get on the floor this week, maybe pass them and get a little bit of negotiating leverage. Jack,
Is any of this going to happen? Or do we all go home at the end of the week with nothing to show for it.
I don't think all of that happens.
For one though.
On the continuing resolution to just avoid a shut down, both chambers are working separately on something, so we may see two competing versions. There's still a lot of questions about the timing there, how McCarthy gets support for a stopgap measure to avoid a shut down from the hardline conservatives.
And then also last.
Week, Chuck Schumer made a procedural motion to set the stage for the Senate's own continuing resolution, but they'll need bipartisan support and realistically they'll probably want and maybe need unanimous consent to bring something forward in time for it to be relevant. So there are some competing priorities there. And then you mentioned the four government funding bills that
the House is trying to bring up. They got or at least it looks like they'll probably have support for the rule for all of them, But the idea of getting four done within one week with as many amendments, those hundreds of amendments that they approved, is not realistic. So I think they're giving themselves a number of options and they'll figure out which ones they can actually move forward on floor votes.
Well, considering how hard it was to get the rule passed on the Defense bill, or how hard it has continually proven to be remains an issue there. Of course, is Ukraine funding and Jack, as you talk about unanimous can being needed in the Senate. If there's anything in regard to Ukraine, isn't Ran Paul for example, going to hold things up?
That is a very good question.
On Ukraine.
We haven't heard individual demands yet on pulling out Ukraine aid from a Senate stopgap measure. There's a really big sort of looming question about what exactly Conservatives want and need. In terms of Ukraine. For example, there was discussion about pulling the usual Ukraine aid out of the government funding bills that the House is bringing up and then allowing a standalone vote on that. Leadership kind of changed their minds and said we'll leave it in there, but we'll
give you a standalone vote on pulling it out. And just after that Marjorie Taylor Green said that wasn't enough. It's a very unclear picture in terms of what machinations have to happen to satisfy the hardline conservatives. But there have been a lot more demands in the House than the Senate so far on that.
I hope you're sleeping okay at night, Jack, I mean we must wake up and have to like defrag your.
Brain every day with all of this, I won't feel over the next week.
Government.
I understand. Thanks for the time, sir. As always, he does this for a living appropriations specifically, so Kayley, this is the perfect opportunity to talk with ck mulveney. You now imagine a world in which you've run omb, you co founded the Freedom Caucus, and you helped to run the White House as chief of staff. All the touchstones involved here, and of course that would be McK mulvaney.
There's never a bad time to talk to me. There's a bad time to talk to you and Kayley, but maybe this week.
That out. We're always looking. That's why we do it every week at this time. By god, I don't think that's weekly around here.
Like this, but anything else going on to Washington, there's.
A just well I could throw a debate at you, or a strike or a couple of other things.
What do you wanna know about the shutdown?
Well, Moody's is upset about it. They say this reflects poorly on our credit. And of course remember Fitch said it's times like these that you know, you guys have no credibility. I guess, so we're going to get a downgrade along with a shutdown.
You know, listen that let me nice folks over there, no question about I'm sure they do a really really nice job. Of course I remember about the financial crisis. Maybe they know the things they should have been paying attention too closer. But look, we're going to pay our debt. That's what they should care about, right, There's no question. Now, I recognize the fact that during the debt sealing discussion,
this was that was a legitimate question. You know, are we going to be able to borrow debt or what are we able to finance the debt, et cetera. That's not even on the table. Only about fifteen percent of the government on a dollar basis, okay, term is measured by money. Only about fifteen percent shuts down during a lapse in appropriation. That's the legal term. Shutdown is a made up term by the media. The term is lapse
in appropriation. And most of the government trundles on, including Social Security, Medicare, at, Medicaid payments, on the debt, those types of things. So I get Moody's, I get S and P sort of weighing in. To me, that's sort of sticking the toes in the political waters, which is not really where I like to see them operating.
But it is politics that they are referring to in the Moody statement. They say that it's about intensifying political polarization that continues to put US fiscal policy making, put on US fiscal policy making during a period of declining fiscal strength.
And I get that declining fiscal strength worries me.
It really doesn't.
If they were to come out and say, look, we're thirty three trillion dollars in debt. That's why we're looking at a downgrade. I get that. The fact that we're not doing policy. What policy do they care about other than us paying our debt? Should they care about Ukraine policy, Should they care about border policy, Should they care about any policy? Does that go to the financial wherewith all of the nation. I don't know. Actually I do know,
and the answer is no, it doesn't. But I'm being nice to them.
It was interesting to read the client note from Libby Cantrill at Pemical this morning, who was making the distinction between a partial shutdown and a full shutdown. In this case, Your point is, or has been, though, that decisions can be made along the way that might might make those a little bit gray area. How do you see that.
Partial shutdown full shutdown? There is no such thing as a full government shutdown. You might have had it if we had breached the debt selling. I don't know. It's one of the things you and I talked about at the time, which is that that's sort of an unknown territory. But huge pieces of the government will continue on because they're off budget, they have under other funding sources. So a full government shutdown in this context means anything that
gets a direct appropriation from Congress. For example, the CFPB will continue to operate because they don't get appropriations from Congress. Right, So there's a part of the government that doesn't shut down. The military is still allowed to do a lot of things even during a full government shutdown. Congress can still function even during a so called full government shutdown. So the full partial depends on really the significance there is,
whether or not it's individual. In twenty eighteen nineteen, for example, we had passed the Defense Appropriation Bill, okay, so that part of the government didn't shut down. That's a partial situation. When other folks who did not have other parts of the government that did not have their appropriations bill passed, they shut down, that's a partial government shutdown. But again, when people back home think something shuts down, it ceases
to operate, and that's not the way it works. But I'm sorry, you asked me a different question, which was, yeah, there's a lot of latitude. And my favorite example is in the two thousand and I think it was thirteen during the Obama administration. I was in Congress. The Obama administration chose they have the latitude to do this, to close the national monuments, and in fact, they put signs around them saying closed because of.
The shutfront page as it was.
By the way, if you go back and look at the signs and do this, and I've done this, it's funny because it actually looks like a Trump tweets. Every third word is all caps. It's just bizarre. During twenty eighteen nineteen, when we ran the shutdown, and by we, I mean the Office Management Budget that I was running for President Trump at the time, we chose to leave those monuments open, and we have the ability to do that,
We had a latitude to do that. So what a shutdown looks like can depend in large part on who's running the Office of Management Budget and the executive branch at that time. I expect with a Biden team running OMB that it's going to look really, really nasty once it happens.
Okay, so that's assuming that it does happen, which is looking likely.
By the day, we're going to be more constructive than I am.
Aren't you how realistically it might be avoided? Do you think there is any path to that? Specifically for Speaker McCarthy, what's his way out of this?
Well, it's a way out that he doesn't want, and it's a way out that I think the people who have been here long enough know, which is that the way out is for the Senate to take a bill are talking now, I think about taking the FAA reuff and turning that into a cr which they have the right to do, and then they send that down to
the House. Okay, so that's a bipartisan bill coming out written by Democrats, supported by some Republicans out of the Senate, going to the House, and then all the Democrats and a handful of Republicans sign a discharge petition bypassing McCarthy's control of the House, and they vote on it and it passes. That is one real possibility, and that's why I think McCarthy and even members of the Freedom Caucus Chip Roy's pulling He doesn't have any hair, so he's
not pulling it out. But they're frustrated because they they they've seen this, this this act before. They know how it ends. If this is what happens, if the House can't pass anything, they'll end up in terms of the
begetting jammed by the Senate. The Senate will send them something and it can bypass the ordinary course of business by going to this just discharge petition and can become law with a House ever not really ever having a chance to put its its its seal of approval or stamp on the on the legislation.
Then the narrative says the next day or the next moment, Kevin McCarthy gets fired.
But why I mean in that circumstance, I mean, I'm very sympathetic to Kevin on this. I'm not sympathetic on the spending. Okay, I'm a big fan of the of the deal that the HFC cut with the Main Street Caucus that would reduce spending, the eight percent reduction. That that's that's the Freedom Caucus doing what it was set up to do, try and figure out a way to use leverage to move things to the right. Okay, And
I like that, and then Kevin actually supports that. But on Kevin, Kevin's major complaint right now is so Matt Gates wants to fire me because I can't get anything passed. But the reason I can't pass anything is because I'm at Gates. I mean, that's I am sympathetic to that, because that's just that's that's absurd.
Well, it's not just Matt Gates, though, there is just a handful of these individuals. What would your message be to them right now? Those specific members.
Get out of the Freedom Caucus? Okay, because there's a rule in the Freedom Caucus. I wrote the rules for the Freedom Caucus when we started, okay, and we had some written down and some that weren't written down. And the one that wasn't written down was you had to be able to vote against a procedural motion a rule okay, because that was the most mutinous thing you could you could possibly we could think of at the time. Or you had to vote for a short term cr because
that was the most obsequish you could do to leadership. Okay. But we would do either of those things if we thought we were moving the ball to the right. Freedom Caucus has done its job here. Chip Roy has done his job as the policy chair. They've worked with the moderates and the Party to come up with a good compromise that could pass the House if these other folks would come along for the ride. But Kevin mcarthy's not dealing with a caucus now. He's dealing with a bunch
of individuals caucuses of one. And the situation he finds himself in is Kaylee, you say you won't vote for it unless you get X, and Joe you won't vote for it unless you get negative X. Well, those two things are mutually exclusive, right, And that's where Kevin, that's where he finds himself. And when he does manage to pick up a voter too. I think he picked up a couple of congressmen last week on a rule vote.
He loses another two because of what he gave to the two to try to get them to go along. So it's a very difficult situation for him to be in. What I would tell them is, look, I get it. I understand the debt probably better than they do, right. I understand that we worry about it. But doing it this way is going to make things worse. My bet
is and I'll take this bet right now. If you guys want this, the spending deal at the end of the day that passes out of Washington, d C will exceed the cap set by the debt ceiling discussion.
How about that?
And that's that's right, That's how the town works. One you give the Democrats in the Senate the upper hand, they will spend above that cap.
We heard from Donald Trump, your former boss, on this. This is our amazingly remaining moment unless you get everything, shut it down, he writes in a much longer post on social to what extent is he influencing the outcome of this?
You know, I think he's probably got a lot of influence over Gates and Marjorie Taylor Green and those kinds of although she is you know, they're not agreeing on it, and they're not agreeing on it. So listen. The bottom line from my perspective on Trump is this is that this has no impact at all on his criminal proceedings.
The Department of Justice will continue to prosecute him. So everybody thinks they're doing Donald Trump a favor politically by by by voting or by preventing the government from funding itself. They don't understand how government works.
Boy, we covered a lot there that was good. Always.
I'm a Southern who can talk fast at times.
Now, well, I love this never pulling a punch either. Mick mulvaney, Great to have you back in Washington and at the table. I'm Joe Matthew with Kaylee Lyons. Thanks for being with us on sound On. This is Bloomberg.
If you're listening to the Bloomberg Sound On podcast, catch the program live weekdays at one Eastern on Bloomberg Radio, the tune in alf, Bloomberg dot Com, and 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.
With regard to the shutdown, and it's not because of lawmakers coming back to town or announcing anything breaking here, Kaylee, Moody's has piped up now and there's a question about whether Moodies might join Fitch and Bess and p yep with a downgrade, telling us that a government shutdown, which of course many people expect this week, would reflect negatively
on America's credit rating. And it's not a shock or it's very similar language to the warning that we got from Fitch back in August, isn't it.
Yeah, When Fitch did decide to downgrade after the debt sealing deal was all buttoned up. None of us really saw it coming. Is that hold on? We're still paying attention. And the kind of political discord that you see in Washington does affect the fiscal outlook. And that's essentially what we're hearing from Moodies today. To quote the release, a government shutdown would demonstrate the significant constraints that intensifying political
polarization continue to put on us fiscal policy making. The politics matter to the credit worthiness of the US.
Well, that's right, and it could infect result in action. Who knows. This is a shot across the bow at least. Kayley. Yeah, And it's where we begin with Congressman Brian Style delighted to say the congressman is back with us. It's been a minute. Republican from Wisconsin serves on the House Financial Services Committee, Chair of the Administration Committee. Congressman, you're sitting there listening to us, and it's good to see you.
Welcome back. Does this make you not want to come back to the capital?
We ultimately we got to get a deal done. At the end of the day.
When you hear the credit rating agencies asking questions like they are, I think it reminds all of us that our system is completely broken.
We're spending way more than we're bringing in.
And when the credit rating agencies, if they do move on this in borrowing costs increase for the federal government, that's real money. We have a thirty trillion dollar debt, you know, half a percentage point of credit risk or fifty basis points. That's one hundred and fifty billion dollars a year when fully baked in. So these are real dollars we're dealing with. It's why the whole system has to be reworked in Washington.
Okay, Well, as we talk about how much time Washington realistically has to rework, Congressman, you're up against a clock Saturday at midnight, coming back to DC tomorrow. The Senate is as well, where do you put the odds of you averting a shut down?
You in your colleagues, it's the darkest before the dawn, and it's not down yet. I'm optimistic that at the end of the day we're going to get there. There's nothing like a deadline in Washington to be able to get a deal done. I feel like sometimes it's a bunch of college students working on a term paper waiting till the final hour.
It's no way to run a railroad.
But that's a little bit of the reality of what we're dealing with in Washington. Hopefully cooler heads will prevail and we can prevent a shutdown. No one wins in the event of a shutdown.
So imagine a couple college guys come over from a different dorm, Congressman, and they've got a paper they've already written. I'm wondering just where your head is today on the idea of the Senate showing up with a continuing resolution that the House might adopt. Does that save the day or present more challenges for your body?
Well, I don't think that's our best case scenario. It's why a group of us in the House pushed hard last week to move forward to conservative continuing resolution, a stopgap measure that would have reduced government spending. Put an impetust Tom who has forward on these appropriations bills and also work on the core policy of securing the US Mexico border. So I'd rather see the House come back here tomorrow, move that forward, and let the Senate react.
I am concerned that the Senate is going to come forward with a continuing resolution, a stopgap measure that'll have additional funding, and that's a worse position to.
Be in as we talk about what you could receive from Democrats. Obviously Democrats controlled the Senate, but in regard to working with Democrats in the House, Congressman, is that something that you would supp if Speaker McCarthy did have to resort to that.
Well, hopefully we can't avoid that.
I'd love to see us move forward with the conservative continuing resolution, but again, no one wins in the situation where the federal government is shut down, and so coming into the final days of funding, I'm still optimistic that we're going to reach an agreement to give us a stopgap measure to truly move forward next year's appropriations bills. Again, it's kind of in that home stretch where deals can
be struck in Congress. Again, it's not a good way to run the operation, but it's better than letting the government shut down.
Are you disappointed in some of your Republican colleagues for actually calling for a shutdown? Congressman, I know that not all Republicans in the House agree on the next steps here.
I firmly disagree with my colleagues that don't think a shutdown is going to cause real significant problems or more importantly, give leverage to the Democrats to allow them to continue reckless spending. And so I'm of the firm belief that we have to get a stopgap measure in place to give time to get our appropriation bills across the line. And I disagree with those of my colleagues they're calling for a shutdown or saying that it would.
Ultimately, in the end of the day, be a good strategic move.
So when we're talking about your colleagues, increasingly, Congressmen, we're talking about just a handful of individuals that may take issue with different components of what the wider spending picture looks like, or just take issue with the Speaker himself. Do you think that we could potentially be faced with a situation in the House of Representatives where Speaker McCarthy has to make a choice between continuing to fund the government and keeping his job. What's your read on this.
Well, ultimately the end of the day, I think what we're seeing as conservatives unified around the strategy of reducing government spending and addressing the unsecured US Mexico border while we're having is a big conversation about what those tactics are. I don't think the tactic of shutting down the government at the end of the day achieves the goal of addressing the reckless spending or securing the US Mexico border. There's a handful of my colleagues that disagree with that.
I just think that that moves us in the wrong direction. It would ultimately give Levyridge to Democrats in the Senate and President Joe Biden. And so I'm going to work tirelessly throughout this week until the deadline here on Saturday to make sure that we avoid a situation of a shutdown, and to do that would kind of core conservative principles at play Congress.
But if somebody put me to sleep halfway through the summer and woke me up today, I'd be really confused. Because we thought there was a debt sealing deal that had been struck between the Speaker and the President that would avoid all of the drama that we seem to be going through right now. I wonder if you're disappointed that that deal didn't hold, and I would ask you as well, would that pass today? What a Speaker McCarthy said, no, we have a deal. Let's bring it back on the floor for a vote.
Well, a little bit frustratingly, some people view that deal that is literally written on paper a little bit differently, and so I think that's one aspect here.
But the devil is always in the detail.
On these spending bills, it's not only how much you are spending, but also what you're spending it on. And when we're actually passing the appropriations bills, the bills that actually authorize the spending of federal government money, the fight is broader than just the top line number. It also involves the programs that are underlying our federal government spending.
And so when we get into the details about border security and about some of the core policies that we need to make sure we're putting forward to truly unleash American energy and grow the US economy, that gets a little bit stickier than it does on simply agreeing to just the top line number.
Congressman, what about spending related to policy abroad? There are a few specific members, frankly, in both the House and the Senate who take particular issue with including Ukraine funding in these spending packages. Is that irresponsible?
Well, I think at the end of the day, any bill that's going to get across the line is going to require a majority vote in the House and the Senate be signed by President Biden. I'd like to see us have a standalone legislation on a lot of these key items. I don't know if we'll have the opportunity
to do that in the House or not. People have divergent views as it relates for American support of Ukraine, but I'd like to see us have standalone votes and a much broader conversation about the US security interest in the war between Russia and Ukraine.
There's a quote from Neil Bradley at the Chamber of Commerce that Kayley showed me, Congressman, a government shutdown is not inevitable. He writes, this is an op ed in the USA today. It is a choice, and it is among the dumbest decisions Washington can make. Do you agree with him?
Broadly speaking?
I don't think anything good comes out of a federal government shutdown. It causes heartache for a lot of hardworking Americans who work for the federal government, whether or not that's in the military or border patrol agents, and also I think politically at the end of the day often results in more spending, and so it's a really reckless way to operate and rarely achieves the goal of addressing the spending levels in Washington.
Back in town later today or tomorrow.
I'll be back to DC late late tonight, maybe early morning tomorrow. I'm currently in Wisconsin. It's always good to be home talking to rational people before we head back to DC.
Sure after a Packers win as well, that's a good point.
You got to put that away.
That was a great comeback, can't You can't complain when Jordan Loved delivers a comeback like that in the fourth quarter.
Hopefully there's more to come for our Green Bay Packers.
Maybe he can come to Washington with you and help us out here. We'll try to be rational when you come back to see us. Congressman, thanks for being here as always. Congressman Brian's style Republican from Wisconsin. He like many getting on an airplane, I think, yep, we'll be traffic and nowhere to park against tomorrow.
I can't wait.
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