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We are bringing you the latest on the indictment of sitting New York City Mayor Eric Adams, who has been indicted on a number of federal charges, including wirefraud, bribery, and solicitation of a contribution by a foreign national. All of this is in this fifty seven page federal indictment that was unsealed today after first being reported last evening. And as we've mentioned, Eric Adams is not intending at
this point to resign. He says he will continue with his day to day work serving as mayor of New York City and is looking forward to defending himself against these charges. But we want to dig into what exactly these charges entail now and turn to June Grosso, who is the host of Bloomberg Law. This indictment is certainly something to behold.
June.
There's a number of allegations listed in here related to things like air travel, for example, on Turkish airlines. According to this indictment, and Adam staff are actually texting with an airline official about the price of a ticket, the airline manager asking how much should be charged. After floating fifty dollars, the staffer says, his every step is being watched right now one thousand dollars or so, let it
be somewhat real. We don't want them to say he is flying for free with that kind of detailed June just how damning is this indictment?
Well, it is very damning, and I want to call it a speaking indictment. So anyone could read this and see what the prosecution, what the US Attorney's office alleges happened. It's a very simple indictment to read. You don't need to be a lawyer to look into it. So, and it outlined all the different trips he took or upgrades got from Turkish airlines and Turkish businessmen. I think what's
interesting about the quote that you just read. There are a lot of quotes of texts between Adams staffers and Turkish officials, unnamed Turkish officials or businessmen, but there are very few of Adams himself. There are some references to Adams saying something like I'll handle that. But that stood out to me because if the US Attorney's Office had those texts of Adams himself, I think they'd be in this indictment front and center. So that may be something
that the Adams defense can work with. But I mean there's a lot of sort of what you'd consider undeniable evidence. And there's also not only that he took this, but that he created a straw map sort of to try a fake map to try to think that try to make people think that he had paid for this. So he created a paper trail. That's those are the two words I want. He created a paper trail or tried
to create a paper trail. So that is really something that a jury could, you know, latch onto and say, well, obviously he knew what was going on if he's trying to create a paper trail to cover it up. So there's a lot of evidence here. And what also stands out is that he abused the New York City, the New York Matching Funds program where and I think they said to the extent of ten million dollars where where
the York will match the donations you get. I believe it's three dollars to one dollar, so that equal very quick. And what comes out is this was you know, the travel is one thing, and that goes back a decade, but this was about getting money for him to run for office in New York. I mean, you don't see a lot of oh he got a goal watch from someone, or you know, personal except for the travel sort of
personal benefits. It's about him trying to become mayor of New York and the cost of that and and what he needed to do. So it's it's very and I just want to say he has hired a celebrity entertainment, very very good attorney, Alex Spiro. He represented different points, Jay z Elon Musk. He's one of Elon Musk's favorite attorney, Alec Baldwin. So he's got already the you know, the top of criminal defense lawyers who's already put out statements about how this was a setup and it was a
dog and pony show at Gracie Manson this morning. I mean, why did they have to raid Gracie Manchin. They already had his phones and texts and the and the mayor said he would turn over whatever they wanted.
So a lot there, Well, it is a lot. And I wonder what kind of collective penalty if he's actually found guilty of these crimes. He'd be looking at here too.
You know, I don't know what the what the crimes, what the penalties would be. I mean, you've got to believe it's it's decades. But but of course this is something that you know, we always talk about. They're facing one hundred years in prison, and no one gets that. It's the judge will look at he has no prior convictions. Obviously, he's the mayor of a large city, and the judge
would look at that and compare it. I mean, I can't believe, but we're really jumping the gun here because we have to go through I mean, he hasn't even been arranged yet. And that was another thing that his campaign brought out that you know, how they learned about this, and they complained about leaks from the US Attorney's Office of Grand Jury Information. The mayor mentioned that as well
as his attorney mentioned that in a statement. So it's a long way from conviction, but this is the same office that just won conviction against former Senator Bob Menendez, So public corruption is something that they do rather well here.
Yeah, bribery charges of course in play in that case as well. June Grosso, host a Bloomberg Lab will be staying on top of this story for us all day here on Bloomberg Radio. We appreciate it very much and we want to add another voice to this conversation now. I'm please to say joining me is Nick Ackerman, former Watergate prosecutor, founder of the law Office of Nick Ackerman, the former assistant US Attorney.
Nick.
Always great to see you. I almost struggle with where to begin in this as we've been discussing extended indictment. I guess the question is, given the stature of this defendant, in particular, a sitting mayor of the largest city in the country, how rock solid would the prosecution have needed to feel this case was in order to bring these charges forward.
Well, considering who the defendant is, they would have to feel extremely comfortable on the evidence. And it's pretty obvious from reading this indictment that they do. They lay it out in such detail. This is not a one shot deal. This goes over a period of time, starting when he was the involved in politics. You know a number of years ago, in twenty fourteen when he was the Brooklyn Bureau President. I mean, this goes way back. You've got
very detailed evidence. You can pick out who the witnesses are, you can pick out where the emails are, you can pick out exactly who's testifying. This is absolutely looks like on the surface and overwhelming case for conviction.
Well, I wonder how long it would take to actually get to that point, though, Nick and I would just point out we have a headline crossing the terminal now that Adams is entitled to the presumption of innocence. This is according to the Democratic leader in the House, Hackeen Jeffries, of course, a member from the state of New York. He says, the indictment of a sitting mayor is a serious and sober moment for New York City. Like every other New Yorker and American, Eric Adams is entitled to
that presumption of innocence. That principle is central to the administration of justice in the United States of America. He goes on to say, in the meantime, I pray for the well being of our great city. So with that kind of political consideration, in minds here, Nick, it is worth pointing out that we're talking about a sitting mayor
of New York who has been indicted. We are also talking about a Republican presidential candidate, the nominee, who has not just been indicted, but in fact convicted in the state of New York and indicted on a number of other crimes. What does this say about the political moment we are in when we're dealing with leaders at the highest levels who are so entangled in legal battles.
Well, I'm not sure there's something general you can take out of this. I mean, this has been going on for years. I used to be an assistant UTI's attorney in a southern district of New York. Public officials were indicted. Back then, I was involved in the Watergate prosecution. We would have indicted the president but for his pardon. All of his aides were in guided and spent time in jail. This has been going on for a long time, despite the fact that the Department of Justice and local das
have been vigilant in going after public corruption. I think even though Maar Adams does have the presumption of innocence here, the political problem posed by this indictment is overwhelming in the sense that it doesn't just allege general violations of law. It gives very specific dates, times, places, benefits that he received in terms of travel, certain actions he did in return for those benefits that related to the New York
City Fire Department, the New York City Buildings Department. It is so detailed it is hard to imagine under these circumstances that he can continue as mayor.
Well.
He though says that he will and that his day to day won't change. I guess you might take issue with that notion when you're fighting a legal battle like this one a bit. But it goes back to the original question I wanted to ask you about timing. How long would you expect this process to play out? Considering, as June pointed out to us, he has not yet been arraigned, no arrest has taken place, or anything like that. How long will it take for this to reach conclusion? Would you estimate?
Oh, I think it's going to take at least six months, possibly a year. First of all, he's got to be arranged. He's going to plead not guilty. I presume based on his statements. There's then going to be pre trial motions. There's going to be discovery that takes a long time. My senses from reading this indictment, there's lots of witnesses, there's lots of documents. He has the right to have
all of that material beforehand. Then after he gets all those documents, will be a time period for motions to be made, and then ultimately the judge will have to decide on those motions. That takes time. This is not an uncomplicated case. In some ways, it's pretty straightforward and simple, but it's got a lot of witnesses, a lot of documents. I'm not sure there's too many legal issues here just
looking at this indictment. This is going to be a hard one to get dismissed based on the face of the indictment, but they're going to try, and all of this does take time, and it just seems to me, based on the granularity of the allegations here and what's been identified, I think it's going to be very hard
for him to continue acting as mayor despite what he's saying. Now, he can say whatever he wants, but I think that once the reporters and the press start digging into the granularity of what is in here and identifying who the people are, the incidents that relate, for example, to the Turkish government building that he gave preference to with the
fire department. All of these things can be verified by the press, and I think the more of this that comes out, the harder it is for him to be governing as mayor of New York.
Well, of course, he doesn't govern alone either. There is
a whole city government to consider here as well. And we have seen nick the resignations of some city officials, others who have had who are close to Adams, who have had their homes rated, for example, as a prosecutor, how important should we be considering those other individuals into the ultimate case the prosecution will make here This idea that people could maybe roll on him, Is that what you would be trying to achieve if you were the Southern district of New York right now?
Oh, no question, that's what they're trying to do. And it doesn't sound like this just relates to campaign contributions. It sounds like this is much broader than campaign contributions, that some of these other people who have resigned have done other things. The question is what is the evidence on Mayor Adams. What will they say about Mayor Adams if they make a deal with the government. There's just so many people involved, so many people have resigned over
the last couple of months. We don't really know the complete scope and breath of what's out there, but I think we're going to learn that as it goes along. But yes, I think he's in a whole world have hurt here because there's just too much There's too many people that can come forward and testify against him.
And if this goes to jury trial, which I'm assuming is what the course of action will take us to here, how complicated is it to try to see a jury in the city of New York when it's the mayor of New York in question. These are his constituents, some of them may be people who voted for him. How complicated is this likely to get?
Nick?
Well, I don't think it's going to be complicated. Look, they were able to set get a jury for Donald Trump, who is the former president United States, and it didn't take more couple of days to do that. It's all done in the questioning of the jurors, which is known as the vaidere to determine whether anybody has any preconceived notions or prejudices. This can all be done pretty quickly. You'd be surprised how many people have not focused on this, don't know anything about it, and are going to be
clueless as to the facts of the case. And we'll be able to serve as good jurors on this case. So I don't see that being any kind of major obstacle in terms of delay, mainly because Donald Trump they were able to get a jury on him in less than two days. I mean, this shouldn't be any different.
Well, fair enough, and of course Donald Trump was convicted on thirty four felony charges in New York earlier this year. This is still an indictment. He does carry the presumption of innotance. Finally, it before we let you go here, would you expect that because we've had this conversation in the Donald Trump case as well. If Eric Adams were to be found guilty of any or all of these crimes, could he serve time in prison?
Oh?
Absolutely, I mean, it all depends on the federal sentencing guidelines. You'd have to look at the guidelines for each of these violations. You've got wire fraud, a fraud on the City of New York for being able to get matching funds from the city. You've got bribery and other violations here. That it all depends on the federal sentencing guidelines and they what amounts of money involved, the seriousness of the crime,
et cetera. So there's no way to know what that will be at the point, but it's serious, all right.
Nick Ackerman, former Watergate prosecutor, thank you so much as always for joining us on this historic day as a sitting mayor of New York City is indicted on federal charges. Will have much more still ahead here on Balance of Power.
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The indictment of New York City Mayor Eric Adams on bribery and fraud charges. He, of course, in the face of those is saying he looks forward to defending himself and will continue to serve as mayor. Of New York City, despite some calls from both Republicans and Democrats who represent New York and Congress for him to resign. Not an outright call for that though from the House Democratic Leader Hakeim Jeffries, who of course represents a district in New
York City. He says the indictment of a sitting mayor is a serious and sober moment for New York City. Like every American, other New Yorker and American. Rather, Eric Adams is entitled to the presumption of innocence. So we wanted to get into this now with our political panel joining me today as Rick Davis, Bloomberg Politics contributor and Republican strategists, together with our Democratic strategists today Caitlin Lagaki Kitlyn and as the Democrat I have to come to
you first. What is the responsible way for Democrats to be responding to this. Frankly one Democrat in particular, Eric Adam. Should he resign?
Yes? I mean, if you read even the first page of his indictment, it's pretty alarming stuff. I expect that Leader Jeffries is working the phones pretty aggressively to help move Adams to the right decision. You know, I think we would all get a lot of short term satisfaction from Jeffries coming out immediately and calling on him to step aside. But you know, what I have seen previously is that it's just typically a lot more effective to work behind the scenes and get these people to step
aside then to call on them publicly. So, you know, I fully expect that's what he's doing. And the indictment is so bad that I can't imagine that it lasts longer than a few days.
Well, Caitlin, just to follow up if he does not do it, though, if he cannot be convinced to resign, what resign? What do you expect the consequences will be for other Democrats who represent New York and its surrounding areas, some of who might find themselves in tough races this cycle.
Yeah, you know, I hope that Eric Adams, you know, for once, does the right thing and he steps aside. There are a handful of congressional seats in suburban New York City that are clear toss ups, and if Eric Adams's goal is to help Republicans hold those seats, then yes, he should stay in office. But I think he's going
to be in self preservation mode. I wouldn't be surprised if he starts aligning himself with some characters who are unsavory, but who also argue that they are persecuted by the government. But you know, I don't think it has a huge impact on individual races. But it's just a distraction that cuts away from the narrative that these candidates want to be driving in their own races, and it undermines confidence in government, which I think is bad for everyone.
Well, and Rick, on that point, I would love to bring you in on that. We're talking about the sitting mayor of New York City who is now under federal criminal indictment. At the same time, we have a Republican presidential nominee who is under multiple indictments, in fact, has been convicted on charges in the state of New York already. What kind of moment in politics are we in right now?
A very litigious moment in politics. It seems to me most of the election yeer has been defined by indictments. Don't forget Senator from New Jersey also, Yes, I mean, you know, it just goes on and on, and I would say this is an era that we are suffering through. Maybe there's a level of.
Corruption and.
Misbehavior that the era is going to be known for, but it's not positive. And I think Caitlin's right. I think that, you know, I come from an era, maybe bygone era, where a politician like Eric and Adams would look at this and say, you know what, I can't do my job effectively for the people of New York. I want to live to fight another day. Clear my name. So I'm going to step down, you know, and clear my name and then come back hard. And there are
examples where that has worked. And of course he's not going to do that, not without a massive campaign with people like you know, the House Minority Leader Hakim Jefferies, who is a colleague from New York, who didn't take the opportunity to make that suggestion today. It'll be interesting to see how long it takes to get him to that point, because it is a massive political distraction in what is otherwise a intensely watched campaign around the country.
And a day we're talking about Eric Adams is a day we're not talking about congressional candidates who have got tight races in New York or the presidential race. So it is legitimately a distraction of the people in New York.
Well, and I wonder about how it plays more broadly as well. Caitlin, just quickly here, Kamala Harris is running in part as a prosecutor. What should she be saying in response to this? Does she have a role to play?
You know, I think she has a role to play in terms of fighting for the rule of law. I think that's where you'll see her draw a clear contrast, is that she believes that we live in a country where everyone is equally accountable to the law, whereas Donald Trump does not. I don't think she's going to want to weigh in on the individual allegations just because she understands as a prosecutor that you don't want to get
in the middle of an ongoing legal process. But I do think that, you know, she is a prosecutor, She has a strong record on this, and I it gives her another opportunity to remind voters of whom possibly still don't know that Donald Trump has been indicted, that there is a clear distinction there, and that she's going to continue to make that.
Argument, all right, Caitlin Lagaki and Rick Davis, our Political panel today. Thank you so much. We'll have much more with them in our next hour of Balance of Power. But we want to turn out a representative in Congress from the state of New York. Congresswoman Nicole Maliatakis is with me now. She represents New York's eleventh Congressional district. Her constituency covers Staten Island and southern Brooklyn, so areas
of New York that are very much affected by this news. Congresswoman, thank you so much for joining us here on balance of power. You already have called today for either the resignation of Eric Adams or his removal by Governor Hochel. Why exactly does he need to resign with not being found yet guilty of these crimes when Donald Trump is still running for president, haven't been felt guilty of crimes and indicted on many others.
Well, first of all, we have a city right now that is in peril, and I think that this is a major distraction for the mayor. I think the mayor needs to focus on these serious charges. You have to remember that there are multiple people within his cabinet that have resigned, So I think this is really the tip of the iceberg. But it has made this city really failing.
It's failing and people are suffering as a result. We have so many problems right now, skyrocketing crime, We have this mass illegal migration.
We have our hotels have been taken over with these lucrative.
Contracts to re operated as migrant shelters, and the people in them are committing crimes and they are wreaking havoc in our city, rapes, shooting at police officers. We have an education system that is failing and a chancellor that just said he was going to resign at the end of the year. We have a police commissioner recently resigned
when we have serious public safety issues. So the city is becoming completely mismanaged and the mayor is distracted, and the best thing for him to do is to step.
Aside to deal with these issues, and that is I think the best thing for the city.
Although I am concerned that we may end up with somebody worse than Mayor Adams, but I think it's the right thing to do if we are going to have any hope of restoring some sanity to this city, to make it governorable again, and to really give New Yorkers the government that it deserves.
Well, of course, if he does choose to resign, which at this point he maintains he will not, acting mayor would be put into place, then a special election would be held to choose a replacement. Congressman, would you be interested in the role should it be vacated?
Okay, you know I ran in twenty seventeen.
People have made it clear they don't necessarily want a Republican being the mayor of New York City. I think that we have to, though, collectively, find a candidate that is palatable across the political spectrum, somebody that could have a like a business background, somebody who can really take the problems that we're facing as a city and bring some management.
One of the biggest problems facing our city right.
Now is the fact that they're contracting hundreds of billions of dollars out to nonprofit organizations. This is work that should be doing number one within the city government, and the government has just gotten so big and so broad. They're outsourcing so much of its responsibility in areas where the city shouldn't even be focusing. So we need to
get the city budget under control. We need to make sure that we're actually using taxpayer money wisely for the things that we need in this city, transportation, infrastructure, public safety.
And good education for our children. Those should be the top focuses.
Not providing billions of dollars in taxpayer funds to citizens of other countries who came into the country legally and are even committing crimes. So I think that you know, I would like to see somebody like a Mike Bloomberg
run again. Somebody who has a business background, knows how to manage a large organization, and somebody who'll be more of a centrist that Republicans and Democrats and independents can embrace, because this city has gone way too far to the left and we're paying for the policies of Bill de Blasio and Eric Adams. But remember the reason why this is a sanctuary city, not supporting people committing crimes in our city is because of Bill Deblasa in the far left council.
So we need somebody who's gonna bring it more to the center.
At this point, Congressman, I will disclose that Michael Bloomberg is the founder of majority owner of Bloomberg LP, which saws Bloomberg Media and this radio network. But we appreciate your thoughts. As always, I do wonder about your thoughts as well and what this does. We know that New York's congressional districts are very much battleground zones in this election,
some of your colleagues are in tough races. Do you think whatever detrimental effect this may have on New York City, there is some benefit for your colleagues in this news. Does it make it easier for Republicans to keep the House?
Well, Look, I think that the fact that there's been quite a few Democrats that I've had to resign and disgrace at the city and state level over the past few years may may bring some benefits to Republicans. I think maybe people see that, you know, we need some type of balance and common sense in our government and elect honorable people, not just by party label, but people that are actually going to do the job and do
it right and do it honestly. But certainly I see no joy in seeing my city being torn apart right now and the issues that we're facing that you need desperate leadership and management, real management. And I'm very concerned about the future of our city. I've been concerned for quite some time over the late last years has taken a real downward turn, and we need to put somebody in the helm that is going to correct this ship, or else we're gonna have real fiscal problems for forever.
And I don't know that New York City can return if we don't If we don't fix.
It now, Congressman, I have less than a minute left here. But one of your Republican colleagues has also faced some allegations within the last week about uh corruption and more specifically, actually paying those close to him to serve in his office with taxpayer dollars. Anthony Desposito. Should he resign as well?
Well what we've done in the past, or we refer it to Ethics Committee to do an investigation. Based on what I've seen so far, there has been nothing that's been that violated any laws taking place. But should we find out more information than we should handle that accordingly when the time is appropriate.
As you know, I've had no problem calling for George Santos to resign. I've voted to expound, do you remember, so I have.
No problem calling on those of my party when it's proven that they've done something illegal and wrong.
All right, Congresswoman, really appreciate you hopping on with us as we deal with this historic news in New York, that is, the Republican Congresswoman Nicole mally Takis of New York. Appreciate your time joining us on the day in which, as we've been telling you here on Bloomberg Radio, Mayor Eric Adams has been indicted on federal bribery and fraud charges. We will continue to follow this story.
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We're going to continue this conversation now and move to other subjects as well, as we head to Capitol Hill, where we find Republican Congressman Byron Donalds of Florida, who also, of course, is a vocal surrogate for the Trump campaign. Congressman, always great to see you here on bloom TV and radio. Obviously, we are seeing another indictment of a very high profile political figure in American politics. Donald Trump himself, as you
well know, has come under multiple indictments as well. Do you see any parallels between this Adams case and the Trump ones.
I really don't, because you're talking about two very different issues.
If you look at the indictments of President Trump, you're talking about novel legal theories never been tried before, where they tried to basically push a square peg into a round poll to try to get the top Republican in the United States the nominee for the President of the United States and Donald J. Trump Versus what appears to be, according to the allegations against Eric Adams, a very deep and massive campaign finance violation where they were bringing wirefraud charges, etc.
The very scheme is very different altogether. They're using tried and true criminal charge against the mayor of New York versus these insane novel legal theories trying to criminalize Donald Trump. They are very two things, and I could go step by step with you through every one of these indictments, but the two are not the same. And I think we got to be careful not to try to make it seem as that now the Department of Justice is
operating with clean hands all the time. What we have seen on Capitol Hill is that that.
Is not the case.
Well, Congressman, as we consider the difference in these cases here. I was just speaking with one of your Republican colleagues from New York, Nicole Mallya Tacas. He was talking about how frankly, city leadership just doesn't need this distraction because the city needs to run. And it's at that point I would point out that many of these cases against Donald Trump have not been wrapped up yet. In fact, he hasn't been sentenced in the case in which he
was actually convicted. Why should New Yorkers worry about the distraction of having to fight a legal battle on the part of the New York City mayor, but not worry about the distractions that could face a president of the United States.
Well, this is a great question, and let me unfold that. Number One, the charges that have been brought, in my view, ridiculously against Donald Trump will have no bearing whatsoever on his ability to run the United States of America. Why would I say that. Number One, these charges that were brought around around mar Lago documents, the same stuff could have been charged against Joe Biden. The Department of Justice
did not charge Joe Biden. And the reason why they didn't do that is because they said he was a well meaning old man. He was facing the same investigation. I would say, Joe Biden's done a terrible job, but it's not stopped him from doing his job when it comes to Eric Adams in New York. And this is why I'm saying it's important that you cannot try to
create some moral equivalency between these two situations. What Eric Adams apparently is facing is dealing with major campaign finance violations, and I mean major to the tunes of tens of millions of dollars from overseas. Very different matter than the ridiculous indictments brought to us by Jack Smith Merrick Garland, the ridiculous rec go charges down in Georgia that make
no sense at all. And obviously what happened in Lower Manhattan, where they had to reach into the past for something that the Federal Election Commission even said there was no there there. In New York, they basically tried to make a crime that did not exist. That's wrong, and that's not going to stop Donald Trump from being able to lead our country and get our country back on track and making America great again.
Congressman, I'd like to ask you about the business of your chamber as well as we find you on Capitol Hill today, having yesterday, of course, seen the House and the Senate pass a three month continuing resolution to keep the government funded until December twentieth. I understand you or a know on that bill, and I wonder what you make of the way Speaker Johnson handled all of this, knowing his original plan for a six months R with
the Save Act attached didn't make it through. It had to go with this clean cr plan B. Does he deserve to be Speaker again if the House is able to maintain the Republicans that is the majority.
Well, look, I think the first answer to your core question is yes. Mike Johnson's in a tough spot. It's been a very difficult Congress to navigate. I will add that one of the reasons we are at this point here on Capitol Hill is because Chuck Schumer, Senate Democrats, and the White House have done nothing with respect to trying to find common sense solutions to funding the government
going forward. In the House, under the leadership of Mike Johnson, we passed five of the twelve appropriation bills, which fund seventy three percent of the government. What did the Senate do. I will tell you what the Senate did under Chuck Schumer's leadership.
They did nothing.
They did no homework, They passed no bills, They came with no solutions. They didn't even try to work on this over the summer months. They basically sat in the Senate and just waited till the last minute, which is typical of Washington, DC to wait till the last minute so you can have to you're forced to deal with some massive bill to avoid a shutdown, which I did vote against because I don't believe we should be doing
that right now. But then you set up a situation where you go into a Christmas on the bus that nobody reads. It is the same song in dance in Washington, DC. That's at the feet of Chuck Schumer and Joe Biden and Kamala Harris. Because they've had months to come to an agreement with House Republicans on federal spending, they have chosen not to. So I think what people really need
to understand is that it's a difficult situation. Whether whether it was Mike Johnson or Kevin McCarthy or Paul Ryan or John Bayner or any other Republican Speaker, because the truth on Capitol Hill is that Senate Democrats and House Democrats for that matter, do not want to negotiate spending in an orderly manner where people can come to compromise. They want to wait for the last minute where you have to take you where you're dealing with a take
it or leave it deal. And you have members on Capitol Hill who don't want the American people to be left in the lurch.
It is an indictment of the process here.
Democrats need to step up and do their job for one.
And of course we all have questions as to whether or not the deal that former Speaker Kevin McCarthy, who you just mentioned, and the deal he did strike with Democrats will stand ultimately at the end of the day, especially that side deal we have all heard so much about. I'd like to ask you, as well, Congressman, about what's happening in the capital today. Ukrainian President of Vladimir Zelensky is there visiting with some of your colleagues before he
meets with Biden and Harris later this afternoon. Many of your Republican colleagues have had criticism for Zelensky, with some of the comments he has made about Donald Trump while here in the US in the last week, as well as a visit to Pennsylvania and specifically a plant that is making ammunition that is helping Ukraine in this war. Mike Johnson, the Speaker, did call for the firing of the Ukrainian ambassador to the US over that visit. What is your thought on all of this?
I agree with I agree with Mike Johnson. And here's why you now have a foreign leader who's now making plant visits in one of the key battleground states in our presidential election. Vladimir Zelenski is now talking tough or talking badly about Donald Trump.
And he's here me.
Obviously he's gonna have meetings with the President and members on Capitol Hill. But that stop in Pennsylvania was highly political in the middle of a presidential election. You know, the Democrats would lecture us about foreign influence in our elections. Well, what is more, what demonstrates foreign influence anymore than the leader of a foreign nation touring a facility in a battleground state forty days before a presidential election. This is outrageous.
But I just want to be very clear with your viewers. The reason why this is allowed to occur is because most of the media will not question Kamala Harris or Joe Biden. That's if Kamala Harris or Joe Biden are even available to answer your questions, and they have no problem taking whatever help they feel they need from anywhere around the globe to win an election. It is election interference. It is wrong, and that's why Mike Johnson has made
his stance. I stay with him in that and my colleagues on Capitol Hill, we need to be investigating this because you can't have foreign leaders coming into our country laying laying down their markers of who should be the next commander in chief.
For our nation.
And finally, Congressman, with your district in mind, in our last minute with you, we all are obviously watching Hurricane Helene as well as barrels toward Florida. Could be an incredibly strong storm. What does the state of Florida need in preparation and potentially in the aftermath is it getting is it not getting anything that it needs?
Well, Look, I know our governor has been in contact with FEMA. They've been they've already been working on this in Florida. Unfortunately. Yes, we deal with hurricanes. Our leadership knows how to get this done. I know Governor DeSantis has already pre positioned assets in key areas to respond to the aftermath of the storm. In my district, we were hit with Hurricane Ian two years ago. We worked with the governor, with the governor of our state, we worked with FEMA and other partners to try.
To build our area very quickly.
Florida, unfortunately, unfortunately, is accustomed to this. We will get through it once again, and we'll be working with everybody to make sure that the people of Florida are restored and they get back on their feet as quickly as possible.
All right, Congressman, appreciate your time today, sir. That is Republican Congressman Byron Donald of the state of Florida. Thank you so much, and stay safe out there if you're heading home in the next few days. This, of course, is Balance of Power on Bloomberg TV and radio. We will have much more ahead.
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Love here in the US, which of course follows a big update in the Asian session, specifically for Chinese equities. Rallied more than four percent in the aftermath of new promises from the polab Buro as they aim, they say, to revive growth with pledges to support fiscal spending and to stop the declining they see in the property sector. More promises of stimulus coming to shore up the world's
second largest economy. And our next guests just actually returned from a visit to China to discuss some of their macroeconomic issues. I'm pleased to say joining me here on Balance of Power on Bloomberg TV and Radio as Jay Shambah, he is the US Treasury Undersecretary for International Affairs. Sir, thank you so much for being with us. As I mentioned, you just returned from China, where I believe your fifth
round of talks with your economic counterparts. They're part of what you were planning to raise, were issues of Chinese over capacity, the concern that China is generating so much that they don't necessarily have demand for at home and therefore flooding the global markets with it. Do the stimulus measures that we have seen China outline over the course of the last week satisfy some of your concern? Do they go far enough to revive domestic demand in China?
Well, first, thanks very much for having me here. What I would say is I'm glad to see the Chinese senior policy makers talking about a lack of demand in the economy, about the need to support growth in the economy,
especially from domestic demand. I don't know that I've seen anything concrete yet that I think would really answer the mail on that, but I think it's an important step that they are acknowledging that domestic demand needs to go faster, and that they need to support domestic their growth with consumption and with domestic demand. I think you know when we've as you mentioned, we were there for what we
call the Economic Working Group. I led a kind of senior delegation of treasury officials there to talk to senior Chinese policy makers, and one of the key points we raised with them is that their savings rate is really high that leads this huge kind of imbalance in their economy unless they can drive some sort of demand for it, and otherwise what they've been doing is channeling that savings towards subsidies to manufacturing industry, producing a lot that they
don't have domestic demand for. And that's what I'd like to see more of. And I think it's a good start to see them talk about it. I think we need to see more concrete policies.
Did you censor that your counterparts are understanding of those concerns and maybe thinking about wider behavioral changes in that regard. What was the reception like when you raised these things.
So this is something we've been talking to the Chinese about for quite a while. I'd say that in one of our trips in February, we really pushed the point quite hard. And then when Secretary Yellen was there in April of this year, she really tried to lay out the case for why this was a problem for both the world economy and really why it was a problem for the Chinese economy. You don't want to subsidize a lot of firms that are losing money. It's inefficient, it's
a waste of fiscal resources. It's also just low productivity for your economy. So one of our advantages, frankly at Treasury right now is we have a world renowned economists leading Treasury, and so people take her seriously when she's there, and they really do want to listen to her. From a political perspective, they certainly push back on the narrative of over capacity. But I think what we're seeing on the policy grounds are steps hopefully that it will lead to ones in the right direction.
Well to your point, sir, on Secretary Yellen, do you expect we will see another meeting between her and Holly Fung before this administration is over, I'm not sure.
I think both sides view this channel as a really important one, and that's one reason I was just there, was to make sure that we could keep robust engagement. We've always said it's not tenable to have the two largest world economies not talk to each other.
And one thing the Secretary.
Has often said is we need to talk about the things we agree about and where we can work together, but it's equally as important, if not more so, to talk about the things where we don't agree.
And so that's we try to go and do both.
Cooperation and competition, if you will, Sir, I do wonder, especially given some of the rhetoric we're seeing on the campaign trail from Donald Trump, which I won't ask you to comment directly on, but he of course is talking
about implementing higher tariffs on Chinese exports. Do you see tariffs as a mechanism to address some of these over capacity concerns essentially raise the cost of some of these goods that are being made so that people don't want to import them and that supply doesn't actually hit foreign markets. What is the proper role of trade specific measures here?
So we have used trade tools already, I think narrowly targeted and strategic trade measures can sometimes try to either shift the calculus for a specific product, or for that matter, maybe change the other countries strategy a little bit. So I think narrowly targeted strategic tariffs can be a useful tool. One of the reasons we've been trying to have this conversation with China is to make clear that it won't
just be the US doing this. You'll see this happening from a lot of countries, and that if they do start to see whether it's tariffs or other trade measures, they shouldn't think of it as US attacking China or US being against China. They should recognize that this is really defensive on our part, and China sometimes has agency here they can change their own policies in ways that would not lead to the rest of the world putting tariffs on their goods.
Of course, sirwell, the US's focus is on its own relationship with China. There is concern as well about China's relationship with other countries, including adversaries like Russia. We of course saw Secretary Yellen earlier this year warning about companies providing material support Chinese companies that is, to Russia's war, whether it's through banking or other goods, that if there are providing the support, they risk being sanctioned by the US.
Have you started to see behavioral changes on the parts of Chinese banks or other companies when it comes to dealing with Russia.
So this is a topic that we talk about a lot with our counterparts. They recognize this is something that is a serious strategic interest of ours, and so China has said many times that they have no intention of allowing lethal aid to go to Russia. Where we've been really pressing them is on dual use goods that could be used by Russia to kind of build up the war machine. What we've made clear is that if financial firms are processing transactions towards sanctioned entities or with these
dual use goods, they're exposed to sanctions. Large Chinese banks understand that connectivity to the US financial system and the global financial system is essential for them, and so neither those firms nor their regulators want them to do anything that runs afoul of our sanctions.
So a lot of this is.
Doing the hard work of making clear what really would expose you to risk and what wouldn't what exactly we're trying to get firms not to do.
Sometimes that can lead to where we've had to sanction a firm.
Not financial firms so far, but we have had to sanction a few Chinese firms because we felt that they were crossing lines. And what we try to do through dialogue is in some sense stop the behavior before it ever happens and before we have to take sanctions.
And finally, Sir, in our last minutes with you here, i'd like to ask you kind of a wider question. It does relate to Russian behavior as well, the ongoing war between Russia and Ukraine and one of the great bread baskets of the world, a hot war in the Middle East as well, where of course a lot of
energy is centered. How concerned are you when you look at the global economic outlook and some of these risks that are present about things that could refuel inflation, for example, or otherwise be disruptive to a global economy and a US economy. Frankly that to this point has been able to hold in there even as we've seen inflationary pressures come down.
Look, I'm an economist by training, and so I worry about everything.
But that being said, I think.
What we know is that geostrategic risks or geopolitical risks are always out there. What we try to do is minimize any potential impact on the US economy. As you noted, I think we've seen a really strong US economy.
I think it was a bloomberg pole.
Maybe a year and change ago, where one hundred percent of the people polled thought we'd have a recession in twenty three.
We didn't.
We got through the year with actually quite strong growth, and we've managed to see inflation come down while the unemployment rate has stayed at a fairly historically low level. That's despite lot of challenges around the globe. We're obviously doing everything we can at Treasury and across the US government to minimize any of those challenges to prevent disruptions to energy markets or food markets or things like that that could damage the world economy and really blow back
on US consumers. So we think about it all the time, we worry about it all the time, but we are hopefully taking the steps that would prevent those shocks from really reverberating.
Here all right, Jay Shamba, the US Treasury Under Secretary for International Affairs, Affairs greatly appreciate your time today, sir, thank you so much for being here with us on balance of power.
Now.
Of course, the other big story we're following here on balance of power comes from New York with the federal indictment of Mayor Eric Adams on bribery and fraud charges. We want to dig more into the actual charges he is facing now and turn to Dave Ehrenberg, who is state attorney for Palm Beach County in Florida, but is in New York today. It is the place to be in the news today, Dave. Great to have you back
here on Bloomberg TV and radio. Obviously, there's a number of federal charges here, alligation of accepting illegal contributions, including from foreign agents. How serious are these charges as a prosecutor? How easy is this case to prosecute? How hard will the defense be for Mayor Adams?
Kaylie Good to be with you.
The challenge is proving intent that Adams knew that he was accepting illegal campaign contributions and bribes. It's much easier to prove the free gifts, the air travel, that kind of stuff. But really the bread and butter of this indictment is the wire fraud accusation, which is a federal prosecutor's best friend. It's relatively easy to prove, and he can get you up to twenty years in prison. He's
facing up to forty five years in total. I think the stuff that was laid out in the indictment shows that that Adams allegedly was trying to obstruct, was trying to hide his involvement in all this, changing his passwords on his phone, trying to cover up the documents that would have shown that he took these trips and these campaign contributions. So they've got a good case against him. After all, they're not going to go after the powerful mayor of New York City unless they've got the goods.
Well, yeah, that was a question I had when this news first drop. How ironcloud does a case need to be to essentially make a sitting mayor of the country's
largest city a criminal defendant. It was raised to me though earlier on the program, Dave this notion that while this indictment is vivid in detail in terms of messaging and texting that was exchanged with Adam staffers and various others, included representatives from Turkish airlines, for example, when it comes to some of this travel, not much of it is actual messaging from Adams himself. Is that a complicated factor here for the prosecution.
It'd be better if you have his own words. But they do have the cell phones and the computers of a lot of his associates, and that's how you know that the Feds are serious. Once they have your electronic communications, something's going to go down. They've been investigating this for
a while. I mean they've traced this back for nine years that he's allegedly received these improper benefits, and then they were specific that The alleged bribe occurred when the Turkish got sought to get an expedited approval of this thirty story consulate that was ready to go, except the Fire department said that doesn't meet code. Well, they invested allegedly in atoms and then Adams supposedly leaned on the fire department and the certificate of occupancy was granted thereafter.
So that's where you have your bribery, that's where you have your wire fraud in partment. And then you have the abuse allegedly of the matching contribution.
Laws in New York, where you're entitled to.
Get matching campaign contributions if it comes from an individual donor. So then the Turkis's government apparently funneled the money through individuals so that it could then be multiplied under the campaign finance laws. So he get advantage of that, and that's where he's also being charged. So he's got a lot of problems ahead, and I would suspect that some of the people closest to him will flip on him to save their own hides.
Well, and we have seen the resignation of a number of city officials others who of course have had their own proper already searched over the course of the last several months as this corruption investigation was ongoing. Is that really what's what's the lynchpin. The critical point here for the prosecution is to get to those flips to actually happen.
That matters a lot to have him on the stand. Adams has some very prominent attorneys representing him, so the FEDS are going to have to come with all their firepower here. That means flipping witnesses who know where the bodies are, very metaphorically speaking, also using the electronic communications
against Adams. One interesting anecdote need the indictment is that Adams apparently was tipped off that he was about to be searched having his phone seized, So when the Feds got his phones, he didn't have his personal phone on him, that was left at home or wherever. And then he previously had changed the password on that personal phone. The personal phone is where the more incriminating stuff apparently was, and he changed the password made it much harder for
the Feds to access. And so he apparently knew what he was doing and that's going to be used against him too. It's all about intent.
Finally, Dave. In our final moment with you, I'd like to ask you about a question a legal case much closer to home in Florida, which of course, was the attempted assassination of Donald Trump just weeks ago. The man Ryan Ruth, who was initially charged with firearms charges related to that, was indicted on an attempted assassination charge just this week. How does that case move forward from here?
The Feds are doing a good job. First, they started with a low hanging fruit, the firearms offences that kept Ruth in jail, and then they came back after the evidence was developed to charge Ruth with attempted assassination that can get the guy up to life in prison. So when Governor DeSantis and former President Trump accused the feds of small ball, no, they're going for it all here because they've got that handwritten note from Ruth that shows
that he did apparently intend to assassinate Donald Trump. So the Feds are going to move forward with this. Ruth will continue to plead not guilty. I don't think he could a plead deal out of this unless it involves decades in prison. So he's not going anywhere anytime.
Soon, all right, Dave Ehrenberg, the state attorney for Palm Beach County. Always great to have you here on Bloomberg TV and radio. We appreciate your time, and of course Bloomberg will be staying on top of this story.
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We're keeping an eye on not just those down ballot campaigns, the presidential campaign as well. As this has been I think we could call it Economy Week for the presidential candidates, both Donald Trump and Kamala Harris giving speeches and key battleground states this week outlining their different policy proposals, some
of them specifically targeted, for example, at manufacturing. Harris spoke in Pittsburgh, Pennsylvania, yesterday, and after doing so, sat down for an interview on MSNBC, where she faced more questions around these proposals and some questions around the proposals of her opponent, Donald Trump. Here's one thing she said to Stephanie Ruy.
Part of it is you don't just throw around the idea of just tariffs across the board. And that's part of the problem with Donald Trump. Frankly, and I say this in all sincerity, he's just not very serious about
how he thinks about some of these issues. And one must be serious and have a plan, any real plan that's not just about some talking point ending in an exclamation at a political rally, but actually putting the thought into what will be the return on the investment, what will be the economic impact on everyday people.
So we want to get more into those questions now, and turned to row Hit Kumar, who was principal and co leader of Washington's National Tax Services at PwC and former policy director and deputy chief of staff to Senate Leader Mitch McConnell. Here with me in our Washington, d C. Studio. It's good to see you, as always, row Hit. She suggested that some of the ideas put forward by Trump, including around blanket tariff policy, she called them not serious policies. Would you agree with that?
Creation serious policies? And I think people dismiss them at their own peril. Congress over the last almost one hundred years, has actually delegated quite a bit of authority to the executive. Those authorities have never been tested in the way that foreign President Trump is talking about testing them. So one assumes that if he actually does the things that he's saying he's going to do, that ends up in litigation
and the courts to ultimately adjudicate the question. But I think one thing that is lost in this conversation, so you know, there's a criticism of the tariff policy, which is that, well, this is a cost that's ultimately born by regular consumers sales tax, sales tax, right, which is actually not too different than the way most of Western Europe funds it's government.
But that's maybe a separate question.
I think what's lost in this conversation is we're sort of there is a little bit of intentional fiction being engaged, which is these tariffs born by middle class consumers, et cetera. But like the corporate tax increases that Vice President Harris is proposing, it embracing many of the Biden proposals that those somehow come out of like a you know, out of a money tree that sits in a corporate boardroom
or something like that. But the truth is, and there's a ton of academic research on this question corporate tax increases. You know, corporations at some level don't actually have their own money. They have other people's money, right, They have the money of their workers, their customers, and their shareholders. And so when you raise corporate taxes, it comes from some combination of workers, customers, and shareholders. And the academic
data sort of varies. What's the distribution of the burden, but it's roughly half. You know, some would say it's half customers, some would say half labor. No one thinks it's all shareholders. And even if it were all shareholders, sixty one percent of the public owns share So all of these proposals that are being kicked around the cost of it is ultimately born. To the extent that we actually pursue any of these policies, that's a separate question
for Congress. Ultimately, perhaps to adjudicate the cost is born by largely the same population of individuals.
It just shows up in slightly different ways.
Okay, So I guess it raises the question of what is the more responsible policy to fill the Treasury's coffers. If you're looking at tax cuts or credits for certain portions of the population, which they both are. Do tariffs work? Is that offset or does it have to be higher taxes of some would work economic consequence of that.
Yeah.
So that's an interesting question because the tariff play is a little more complicated because it's not just one bounce of the ball. You raise tariffs and some other sort of third party estimators. I suggested that the tariffs AT's sort of the low end of what foreign President Trump is talking about could raise. You have three hundred billion dollars a year or three trillion dollars over the ensuing decade.
Just as a reminder, the tax cuts that expire at the end of twenty twenty five to fill that hole completely, if you want to extend all that tax relief, that would cost about four and a half trillion dollars over the next ten years.
This is real money even for the US government.
So tariffs could you know, hypothetically fill a substantial peace, if not the entirety of that whole. So it is real, it is certainly there. And likewise, on President or Vice President Harris, potentially President Harris's side, allegor you raise the corporate tax rate to twenty eight percent. You know, that's worth at least a trillion dollars or so of additional revenue, could be more, depending on you know where.
You draw the line.
Again, though, you know these are campaign proposals, right.
And as you pointed out, you need Congress to implement.
Well, you need Congress on corporate, corporate or any tax policy changes that requires Congresses. Kind of blessing the tariff play potentially right, And again, these these authorities have not been tested in the way that former President Trump is talking about testing them. But potentially tariffs could be done by execute authority. They could certainly be done by Congress. But separate question about whether you'd have the votes in Congress to.
Do this well. And with that question, what are you telling clients right now with PwC about what you think is realistic knowing that there could be divided government? Are there areas of ten policy you do expect will change regardless of who is in ultimate control?
I do, yeah, So you know, on the on the sort of good news side, for lack of a better term, both parties have agreed that no one making less than four under thousand dollars should experience this automatic tax increase that happens at the end of twenty twenty five. So that is now like table stakes in a divided government or even in unified control. No matter which party had unified control, both parties say no one lessen four unite
thousand dollars should experience this automatic tax increase. That's about ninety five percent of all income tax payers in the country. There will be a negotiation if in divide a government of the more than four hundred thousand dollars crowd, There'll be a negotiation over the pass through deduction, the state tax exemption, you know, all the other child tax credit which gets cut in half at the end of twenty twenty five, although there's I think general consensus that letting
that cut in half is not preferred policy. And look, I don't know who the next president is going to be, but if former President Trump becomes President Trump again, then you have to take this tariff question quite seriously and start looking at do we import product, where do we import it from? Is there a domestic alternative, and the like. So these are the kind of scenario planning questions we're going through.
Well and as we continue to do. So please come back and talk to us more about it. Wish we had more time today. Rohit Kumar as principal and co leader of Washington National Tax Services at PwC and of course, former deputy Chief of Staff to Mitch McConnell in the Senate.
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