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The weekend of strikes also took place alongside a deal actually being struck on the border, and the text has been released. The headline on the terminal now Senators reach deal on Ukraine aid US border, but hurdles remain. And that's for sure. You've got the Speaker of the House still calling this doa in the House of Representatives. Even conservatives and progressives in the Senate are making us wonder if this can pass the chamber in which it was born.
This is, of course, the deal that we have been talking about here for weeks, if not months. The final price tag on this. We finally have the text here after talking about this for so long. One hundred and eighteen billion dollars. That is more than first estimated, more than was requested by the White House, and it's supplemental ask. It cuts the number of migrants eligible for asylum, It changes the way claims are processed, and everyone's finding something
to hate here. That's where we start our conversation with Maya McGuinness. Always fascinating to talk to Maya with the Committee for a Responsible Federal Budget where she is president. It's interesting here Maya, to learn that we can in fact reach compromise on something. Whether it gets past is another matter. But is any of this paid for?
Well, we are right now in a moment of lots of emergency or supplemental spending, which basically means nobody bothers to pay for it. And there's a good argument that when you're talking about emergencies, it's not something that needs to be offset because it's unexpected. It's a one time thing. You jump in, you find the money later, you deal with that later. But obviously the border is an emergency in terms of how big of a problem it is,
but it is not something we haven't known about. So there is a lot of emergency spending right now on the agenda, border Ukraine, Israel, all sorts of different things that they are contemplating. None of these things would be offset.
They would add to the national debt. And I would say that at a time when the debt is as bad as it is even legitimate emergencies, we should try to offset those costs of a reasonable amount of time, because debt is debt, and we really we've got to deal with the emergencies that are piling up in the world right now, but we also have to deal with the emergency of the national debt, and you do that by.
Paying for things because it is its own emergency. Mia mcguinnis debt is debt, You're right about that. Now, I see Speaker Johnson who doesn't like this bill and says it won't even get a vote. Steve Scalise said that he is planning a vote this week Maya on a seventeen billion dollar standalone Israeli aid package. Remembering he did this at one point and there were offsets that were coming out of enhanced funding for the IRS. It appears
there are none here. The Freedom Caucus is unhappy about it. So is that little honeymoon over now? The Speaker of the House is putting bills on the floor that aren't paid for.
Well, this was a complicated one.
So when they came out and said they were going to pay for the Israeli funding, that was really a great sign of understanding. They are very important things we have to do. Important things are worth paying for. There's an important caveat on this one, though, which is repealing the money for the IRS doesn't actually save money.
It makes the deficit larger.
Because all of the experts who have evaluated this say that a dollar additional dollar for the IRS actually generates.
More than that in terms of closing.
The tax gap or the amount of taxes that are owed by corporation, small businesses, the well off that aren't paid. This is probably the only program that you will ever hear me say actually could pay for itself. So when you appeal IRS funding, that would be scored as making the deficit worse. So I loved the principle of let's pay for it the one policy they picked to do. So I don't think really he was the right one. But your question is more about politically, what does this mean.
I think we're in a different situation this speaker. I think he has more leeway. I think that the members of his conference may disagree on specifics, but they understand how difficult this is and they don't want to go through another exercise of kicking out the speaker.
So I think he's communicating with him and trying to figure out what to do.
But this is really about House versus Senate and showing who's going to have the upper hand and creating what the agenda is for what emergency supplementals move forward, and what the format of those bills are.
We're going to have a lot more on the contents of this border deal and break it down coming up with our panel a little bit later on this hour. But when I look around at what's happening here Maya and you're looking at the same calendar, I am there's going to be discord apparently a lot of handwringing and gnashing of teeth over this. But we have less than a month to figure out how to keep the government
from shutting down in March. And there are a couple of other issues that need to be handled as well, whether it's FAA or Faiza. We've got this tax deal that was passed last week that may not see the light of day. I guess I'm wondering if you worry that this border debate with Ukraine and Israel attached bogs us down on a level where we can't get anything else done. Are we going to shut down in less than a month.
Well, listen, I worry about everything.
There's lots to worry about, but I think there's actually capacity to deal with emergency supplementals, the border tax deals, and funding of government if we work efficiently in these things.
The problem is that.
There is a very small group of people who are really rolling up their sleeves and working on each of these issues, and then a lot of members in the House and the Senate kind of sitting on the sidelines waiting to see what happened so we can work in this very differently.
The process is not conducive to getting things done.
But to go to your first point, which is so important, we are one third of the way through the fiscal year. We have not passed a bundt, we have not funded the government, and from everything I can see, we are doing very little to move those appropriations bills forward. I was really impressed when the Republicans were saying, we don't want another omnibus. That's where you hide all sorts of unpaid for legislation.
Sure, they wanted to go through.
The actual act of budgeting, and I think calling for that's very important, but I just haven't seen any signs that as we are only four weeks away from that deadline, there's any progress being made on coming up those appropriations bills and importantly working out the differences between the House and the Senate, because the conversations I'm having right now, tensions between those bodies are also running very.
High, which makes me wonder. I have to ask you if at some point here maya is it more likely that Joe Biden's State of the Union will be postponed because of a shutdown or canceled, or is it more likely that he'll give that speech but Mike Johnson will not be sitting behind him.
Oh boy, that's a good one.
Well, first off, I each of the could have been shut down moments. I didn't think we were going to shut down, and I was pretty confident. I'm not quite as confident this time. I don't think we're going to shut down. I don't think it's in anybody's interest, and it's a very important political year where I think people
are understanding that. But there's a risk this time that there wasn't last time, because I don't think they'll be further continuing resolutions and there is a lot of resistance to one big funding or a couple big funding bills, that kind of paper over the details.
But I think we will.
See the state of the Union. I think that the speaker will be there. I think it will be a political.
And contentious state of the Union. But I think it will go ahead as planned.
On the date, and that I think will just go ahead and call progress if that happens. Mayam Aguinnis, I have to ask you about a big story here at that say you'd better believe it. I want to throw a big log on the fire while I have you in a couple of minutes that we have less than the commentary that I saw you writing at the Post and couriers. Social Security is in trouble is the headline. Most Canada won't admit it. This is for sure, Maya.
We've been talking about this a lot in our campaign coverage. In fact, an interview that I had with Nicki Haley ended up being part of a Trump ad because she dared to answer a question about raising the age for eligibility for Social Security. Your point in this column is well taken considering the fact that no one will touch this. It's still in al Gore's lock box somewhere. Will we be able to have this conversation after the presidential campaign.
Yeah, that's what I'm really worried about.
And I've been actually quite impressed with all of the coverage that you all are putting out there. Because this is this issue that is so political and gets politicized and demagogued, and people just are outright.
Not telling the truth. It's very difficult.
For in a campaign cycle for the policies to get coverage. And I have to say that I have thought Nicki Haley has talked about this issue. She's talked about some of the things that she would do that would actually close the solvency gap. And while you've had a lot of other candidates, including both President Trump and President Biden, talking about what they won't do, the bottom line is Social Security and Medicare have trust funds that are going to become insolvent.
Nobody likes it.
Everybody who paid into the program does not appreciate the fact that these are structurally imbalanced. But there are lots of reasons for why, and the end result is we're going to have to make some changes.
There are ways we can do this that.
Will protect people who depend on the program that make a lot of changes for that start in the longer run, so people have time to plan younger people, not current retirees. But the more they demagogue, the candidates who do demogogue, the more they do exactly what we're difficult going to be to fix this program.
Come back and talk to this when we can talk about solutions. Maya mcguinnis, this is Bloomberg.
You're listening to the Bloomberg Balance of Power podcast Ken Just Live weekdays at noon Eastern on Applecarplay and then royd Oto with the Bloomberg Business app. You can also listen. I have on Amazon Alexa from our flagship New York station just say Alexa playing Bloomberg eleven thirty.
We also have to talk about something the UK has been involved in with the US in recent weeks, which is strikes in the Middle East. We've of course seen a multitude of them over the weekend. And joining us now as General David Deptula, dean of the Mitchell Institute for Aerospace Studies and of course a former US Air Force retired lieutenant general. So Lieutenant General, thank you so
much for joining us. If you could just react to what we have seen develop over the weekend, the actions the US has taken thus far, how escalatory in nature were they to you?
Well, first, Joe and Kayley, thanks for having me to join into this very important discussion. The bottom line up front is that that airstrikes has past Friday against the Iranian militia groups. We're an appropriate response, and quite frankly, it's good to hear that they're the first part of a series of operations will continue to degrade Iranian militias that are attacking US forces.
This is not a one and done kind of attack.
Iranian proxies in the area are numerous and robust, and frankly, as I mentioned, it's about time.
It's well past.
Time that the United States signify the importance of responding to the kinds of aggression that its forces are facing in the region.
I want to hear about some of the choices that the Pentagon made here. General, knowing that you flew the F fifteen, we saw b ones fly around the world from basis here in the US to take part in that initial strike on Friday, saw the Navy get involved with F eighteen's off the USS Eisenhower. Over the course of the weekend, some cruise missiles have been used here. What do you make about the selections of hardware. How effective was it?
Well, first, you know, the military commands in the region are still assessing impact.
But if you look at the use of the.
B One, which many people are wondering, why did you do that and launch it from the United States?
I tell you that first it.
Induced a degree of surprise with respect to adversaries in the region. Second, it's an aircraft that has a very large precision payload. In other words, it can drop many weapons from one platform and stay airborne for long periods of time. And finally, it also signaled that the United States can project power without local basing. Our US based bombers can reach.
Anywhere in the world in a matter of hours. It doesn't take weeks or months to do so.
So, by the way, as you mentioned over the weekend, but even on that strike on Friday, the b Ones were not the only aircraft.
That were used.
Air Force aircraft are deployed to the Middle East and they were also part of the attacks that you saw on Friday.
Well, Luchdrum, you mentioned the projection of power on the part of the US. How much power is projected if the signal being sent is that the US is reluctant to directly strike Iran in its own territories. The US giving too much away here in terms of what it is not willing to do, what power it will not utilize.
Kaylee, that's a wonderful question. Let me speak to a minute or for a moment about deterrence, and let me remind your audience that the way one deters a wider war is not by saying that you don't want a wider war or that we won't strike inside Iran, but by making sure Iran understands that.
If they and their proxies continue.
Attacks on US personnel, then they can expect disastrous consequences. In other words, deterrence is achieved by instilling in the minds of the Iranian leadership sufficient uncertainty of achieving their objectives so that they decide not to continue their attacks due to the potential consequences. So I'm afraid that attacks on US forces in the region won't stop until Aron understands that their critical interest are at stake. So the administration has to stop telling our enemies what the US
is not going to do. Is that only will encourage them to continue their attacks. So I got to tell you, it's very frustrating, and frankly, the kind of attacks you saw on Friday and follow on the weekend are ones that should have been conducted when attacks against US forces commenced.
Back last year.
That would have increased the probability of deterring the four months of attacks on US forces since then.
Well, are you taking them at their work here? We were speaking with Michael Knights a couple of days ago. Generally he said, we are out of runs on the escalation ladder. If this doesn't work in say, a couple of weeks and we're still playing with this, is a strike against Iran out of the question.
Well, no, it shouldn't be out of the question, and quite frankly, as I just said, we shouldn't be telling or telegraphing what we may or may not be doing.
What I tell you.
Is that actions directly against Iran will be fundamental to halt their continued aggression and the aggression by their clients.
Now, that action can take many forms.
It can be lethal, non lethal, economic, diplomatic deterrent, or combination of all of these. And while I don't want to get into specifics in terms of what I would target, because all that does is a the Iranians. I believe that it would be wise to initiate full up sanctions on Iran against all forms of their economic income, particularly they're oil exports, and then if necessary, direct attacks against
the Islamic Revolutionary Guard core leadership. They're key essential systems which allow them to function, their infrastructure, their personnel, and they're deployed forces. And again without getting into specifics, those are some general areas that Iran needs to be put on notice. Are libel to be struck and that may have.
The effect of deterring the Iranians.
But we also have to be ready to back up these statements. So we're not I mean, Michael's a friend of mine, but I have to tell you no, we're not anywhere close to getting to the last rung in the escalation ladder.
Well, of course, when we're thinking about rungs and ladder here you also there is the latter in terms of how financing from Iran goes to these different proxy groups. As we talk here about deterring Iran, are we assuming that the connection between Iran and its proxies are strong enough that that directly translates or is there a certain degree of control that Tran, even if it decided it wanted to, cannot exercise over some of these groups.
And now again another great question. You know, the short answer is complex, but that's why I said that with respect to deterrence, you know, we have to keep the issue of actions directly against the government of Iran on the table. Only when they understand that their critical interests are threatened, will they pull back the throttles on the
aggression that they may in fact be orchestrating. Yes, to a degree, there is some independence of these proxy groups, but these proxy groups rely one hundred percent on Iran for their military capabilities.
All right, Lieutenant General, thank you so much for joining us. We really appreciate your time. That was Lieutenant General David Deptula, who is now Dean of the Mitchell Institute for Aerospace Studies. We really appreciate your time.
You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon Eastern on Apocarplay and then Broud Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts. I'll watch us live on YouTube.
Welcome back, indeed to Balance of Power on both Bloomberg Television and Radio here in Washington. We've talked at length Joe about the politics around the border deal, the text of which was just released yesterday. Politics really defines the name of the game right now. Less so the actual policy you were running through it just a moment ago. The changes to asylum and parole authorities, the sheer number that would be allowed in before President Biden would have
to use the authority to shut things down. There is real policy substance here. It's just a question of how much that actually matters.
I'm just wondering how many people are getting to the point of reading it, because minds seem to be made up last week based on leaks and Facebook reports, social media Trump tweets because these were considered out of reach for Republicans until very recent history. Kayley, and it looks like they might let it.
Go well dead on arrival in the house. That's what we're hearing from the world leadership. So maybe you just don't even catch it in the first place, you just don't touch it at all, less so letting go. But the fact of the matter remains, the policy we're talking about is about what happens when people arrive here when they're actually at the border, whether they're let in, whether
they're granted asylum, what happens in the United States. There's also the really important question about why the people are arriving here in the first place, where they're coming from. We are on this conversation. We want to bring in now Maria Franda Bazmoski. She's deputy director of the Adrian Ash Latin America Center at the Atlantic Council. Maria, thank you so much for being with us as we consider what is primarily a border measure, not necessarily immigration policy
changes as a whole. Here are these policy initiatives doing enough to address the actual root cause of why we have a border issue in the first place.
Thank you so much for having me. And I think that that's a great question to kick off the conversation. Very few things are being done from a policy perspective to address what is pushing thousands of people to the US Mexico border every single day. I think that you'll hear in the halls of Washington, DC that you know, there's a crisis at the border, and I don't disagree with that. There's certainly a security, humanitarian, economic crisis, but it doesn't start at the US border. It starts three
thousand miles south. We're seeing a huge security crisis in Latin America. Weeks ago, we saw in Ecuador on Life TV just anchors being held at gunpoint, and we're seeing that across Latin America. The whole security situation is deteriorating in the countries, and that is one of the top three reasons that migrants cite as the reasons that are pushing them out of their countries.
Well.
Among the provisions in this deal includes something that Republicans have been asking for for some time, new expedited removal authority for migrants who do not qualify for asylum, and that definition of asylum, as we've been discussing, is being tightened. We heard from one of the negotiators, Cirsten Cinema, that they will be sent back home what happens when they get there.
One of the things that this bill, as I was looking through it, that I think is worth pointing out in relation to your question, Joe, is that there's at least four billion dollars that would be allocated to the Department of State that would be roughly divided into fifty percent of that would be to help build capacity in the countries to accept and reintegrate individuals that have been removed from the United States. I think that that is essential.
I think that the countries in Nine America really need that kind of support. And then the other half of those four billion dollars, four hundred million dollars, sorry, is going to be, if this bill were to pass, allocated to address some of those root costes that are pushing Latin Americans, lots of Central Americans to come to the US border.
Yeah, if it were to pass, is a good point to me, because it looks, sorry now that this bill will not in fact be passing. But when it comes to asylum specifically, something else you hear from, specifically Republicans who have pushed back against having two expansive asylum allowances here in the US is that these migrants should be applying for asylum in the other countries through which they're passing.
Just with your knowledge of Latin America, how hard, how difficult is it to attain real asylum in these other countries that are not the United States.
I think, unfortunately, the infrastructure throughout Lne America for seeking asylum is not very robust. For example, in Costa Rica after twenty eighteen when there were huge crises and manifestations in Iconawa, the system was very quickly overwhelmed, and Costa Rica is arguably one of the most well equipped countries in the region to support assylees and applications. The other thing to note is that these migrants, many times when you talk to them, you realize that leaving their countries
is their last resort. They don't want to leave their homes, but they're being threatened, they're being extorted, they don't have economic opportunities. And so going back to the previous question, I think that this bill again, if it were to pass, would maybe potentially be a game changer if it could help address some of those key factors that are pushing people out and then creating this situation at the border.
Not a mention of Dreamers here or for that matter, any undocumented immigrants already living in the country, should there be.
Well.
I think that this is a comprehensive effort to start to address a system that is broken. That you can say that from I think any point in this country. And I think that this is kind of low hanging fruit. It's we can't deny. This is a political year, of course, It's also sorry elections are happening in Mexico this year too, So I think that that's an interesting dynamic that is shaping some of the substance that is in this in this bill.
And finally, as we talk about the idea that this bill may not pass, what a lot of Republicans are calling for instead is for the president to just use authority that they argue he still has or he already has without Congress granting it, to just shut down the border entirely. If the US were to do that, Maria, what would that realistically look like what happens on the other side of the border.
Well, you would need Mexico's cooperation, and President Lopez Roelo in Mexico has in the past been willing to work, especially with former President Trump, on those on receiving individuals who have been removed. It's an election, yeer, his main the candidate for the opposing party, So ChIL Galvez is in BC today and politics in the US Mexico. Sorry, immigration in the US Mexican relationship is like a It's a tricky thing and I don't know how the president might receive this request.
Maria, thank you for joining us. It's great analysis in the hours following the release of this text. We appreciate your insights here from your perch at the Atlantic Council. Maria Fernande Buzzmaski, Kaylee, There's going to be a lot more time to decipher this, but we're getting some interesting reactions here today already.
Yeah.
Absolutely, Although to her point, we're talking about what happens if the bill passes. That is still a massive if. Is the reality here in Washington today it looks like a.
Good get a vote Wednesday. We'll find out together here on Bloomberg. Thanks for listening to the Balance of Power podcast. Make sure to subscribe if you haven't already, at Apple, Spotify, or wherever you get your podcasts, and you can find us live every weekday from Washington, DC at noontime Eastern at Bloomberg dot com.