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Were You're keeping an eye on what's about to go down at the White House because for a second day in a row, it's a meeting with Congressional Republicans and the newly president once more, Donald Trump. Knowing that the debt cealing needs to be dealt with some kind of aid package theoretically for those who have suffered from the wildfires in Los Angeles. Unclear how those things will be
tied together. Then there's the matters of the actual legislative agenda items immigration and the border, energy and tax reform inclusive of here comes the buzzword salt.
Yes, that's right. What's the old line? As my dad used to say, if it was easy, anyone would do it. It's not easy, and no one can seem to figure this out. Yet. There have been multiple meetings with Donald Trump, from the Army Navy game to the UFC fight to the White House, and still not sure if it's one big, beautiful bill or exactly how that debt ceiling is going
to be managed. Tyler Kendall's trying to seek answers to all of these questions and joins us live from the White House right now, reporting for Bloomberg from a frigid and snowy North lawn. Tyler, what are you hearing? We've got another meeting set for today?
Yeah, hey, Joe.
And actually, those three House Republicans who are here at the White House set a quick high and by to us reporters in the White House briefing room before darting out into the back of Those include Congressman Mike Lawler, Don Bacon, and Brian Fitzpatrick, all three of whom won in districts in twenty twenty four that former Vice President
Kamala Harris also won. So consider it to be more moderate lawmakers who are going to be absolutely critical as President Trump tries to kickstart his agenda in Congress, because as we've been talking about this flurry of executive orders that have been coming down, ultimately we know that those can only go so far, and he's going to need buy in from Congress to tackle some of those big
ticket priorities that you were mentioning. Now, how Speaker Mike Johnson was asked about this by reporters earlier today on Capitol Hill, and he said that Congress is trying to get things going.
What the President is trying to do right now is reset and I second guess his decisions on that. He's using his executive authority because desperate times call for desperate measures. Now, our role is an article one branch of the government is to look through legislatively, which of these things will we codify? What do we need to address it.
Now?
Those comments coming, of course after a Speaker Johnson and also Senate Majority Leader John Thune were here at the White House yesterday, but very few details emerged on if a concrete plan or deal was made during those closed doors conversations with President Trump, as we know that there are some disagreements on a way forward when it comes to a reconciliation package and whether or not to divide up priorities as Kelly mentioned at the top there when
it comes to immigration and energy and also a tax over but Joe and Cayley, we might get more details next week. It appears as House Republicans gather for both a way forward but also on their messaging at an annual retreat at the Trump National Golf Course in Miami, Florida.
Well, as we all would love to be a fly on the wall in these meetings, Tyler, I also wonder if Republicans are bringing up with the President elect at all as they discuss things that can get the requisite amount of votes to pass in Congress. The fact that they actually were able to pull off something by bartisan in the last Congress with the TikTok divest Or Band bill, and he wants to essentially extend the deadline now through
executive Order. TikTok obviously something high on the President's mind in the last few days.
Right when you think about that wide bipartisan support when the TikTok bill passed back in April with that supplemental assistance package. We're talking about people like House Speaker Mike Johnson pairing up with a Democratic leader Hawking Jeffries on that.
Now.
President Trump was asked about the future of TikTok yesterday here at the White House, and he has that he will prioritize national security when negotiating any potential deal. Now, we do know a few weeks ago that Bloomberg News did report that Chinese officials were potentially looking at Elon Musk as somebody who could make that acquisition. And I want you to take a listen here to President Trump when he was asked if he would support Musk being part of that deal, I would.
Be if he wanted to buy it. Here, I'd like Larry to buy it too. I have the right to make a deal. So the deal I'm thinking about Larry let's negotiating in front of the media. The deal I think is this, And I've met with owners of TikTok, the big owners. It's worthless if it doesn't get a pairamit?
So Trump has floated some sort of joint venture between the US government and a US buy are important to note that Musk would likely face antitrust concerns considering his ownership of the platform X. But as we think about this moving forward, we know that Trump says that he will take an active role in the negotiat He called, of course, Chinese President Jijingping last week and said that TikTok was on their list on their agenda list. But
Joe and Gaily. One final thing from those comments, Trump said himself that he's looking at potentially or suggesting that he would download TikTok. We know, by last count, he has about fifteen million followers on the platform and.
It's bringing him the youths at least, so he says. Bloomberg's Tyler Kenda live at the White House for us today, Thank you so much and get warm as you can. And Tyler just mentioned there, Joe that we do know. Donald Trump spoke about TikTok with Chinese President Hijin Ping just days ago. The other two items, though, that he listed as being subjects on their phone call were trade
and specifically fentanyl. And that's something else he was discussing last night, that it's because of the movement of fentanyl from China to other countries like Canada and Mexico that he's threatening tariffs.
Donald three of them.
Yeah, ten percent across the board here, I guess on China. But he's also floated this February first date that they're going to study things. In the meantime, they'll be a hard decision made by then. It's a little bit difficult to tell if this is just the start of a negotiation or what the endgame is You're having promised to do this on day one.
Yeah, so we want to get more into this now. In turn to naswag Na Koktar, she is national Security Practice Group lead at Wiley Bryan and former Assistant Secretary for Industry and Analysis at the International Trade Administration. You worked on these issues in the first Trump admin and here we are days into the second and welcome back to Bloomberg TV and Radio. Are you surprised that we didn't see tariffs put in place on day one?
Well, again, thank you for having me, and absolutely not. We have a number of tariff authorities and each of those authorities require a specific factual, set of analysis and circumstances, etc. So I think it's completely reasonable that Trump administration is in his new appointees are about to go in and some of them are in there, and they're going to kind of take the reins and look at the facts
and look at the tariff authorities. We just the bottom line is we have really so many economic distortions, from subsidies to industrial policies to the exports offensanal as you mentioned, it lots to take on. I think the Trump is relying on his team to go in there and figure out what we're going to take on for a second, third, etc.
Well, this would fly in the face of criticism that Trump is using tariffs as a blunt object to kind of go after the rest of the world. Here are we to believe? Then there are teams studying these on case by case levels right now, what's happening inside the White House as they try to make this determination and to what extent is this a kind of an opening salvo the threats on the campaign trail versus the reality in the White House?
Yeah, So I think it's really important to remember that in the first Trump administration, right, I mean, whenever he imposed tariff, there was a legal tool and there was an analysis behind it, and he took those tools right up to the red line, right, but he never crossed it, which is why they were upheld in the courts. And so yeah, there's a lot of analysis that needs to be done to determine, you know, would tariffs on China be justified for its exports of fensanyl and how is
the Chinese government supporting it? It's we know it's subsidizing the exports of vensanyl and hasn't really been been shutting it down. So what's the factual predicate there that would lead to the imposition of tariffs.
Lie, we show China our work if it comes to that, if in fact that results in a new.
Tear absolutely so, there's a lot of it already publicly available. The government is going to produce a report that will justify the imposition of tariffs or whether they're global tariffs on products or sceptors, through a two thirty two right that the President then has to articulate what the national security threat is for the imposition of tariffs. The China
tariffs are three on fentanyl. That's retaliatory tariffs. So all of this is going to be supported by really good analysis to make sure that the tariff authorities are going to be are not going to be enjoined, and are going to withstand judicial scrutiny.
Absolutely well.
So when we consider the analysis here, Donald Trump has suggested in recent days that for Canada, for example, we don't need the things that are coming from Canada. He basically said that you can cut off business and imports from Canada and no one will be the wiser. And I just wonder to what extent that's really true, that imports from some of these countries are easily replaceable and the US can source from elsewhere.
So I mean, I think his point is, you know, there is we're not going to be in a situation where our dependencies, Remember what we learned from China, our dependencies are so grave that even if we impose tariffs on some things, we would be cutting off our nose despite our face. And what I think what the President is trying to articulate is no more the United States isn't going to be on the position that we're so desperate for imports from a country that we're not going
to be able to take critical national security measures. Right there's a lot of things that for all of our trading partners, including Canada, that we can make it home. But you know, I will also want to underscore that Canada has the largest heavy rare earth mines outside China. Right there, we actually do need the Canadian supply chain. At the end of the day, both countries really value their integrated supply chains, are going to work to integrate it.
And these the these trade irritants that we have, not that they're not legitimate, but both governments, I am confident will be able to overcome because the trading relationship is so important.
So when you hear Justin Trudeau say dollar for dollar, bring it on, that doesn't sound like a real response to you.
That actually seems like the type of response that makes me think that Canada really doesn't understand what we're articulating. We've got subsidies, we've got immigration issues, we've got fensanel, we've got the Canadian government allowing China to circumvent a
lot of our trade rules, including forced labor right. And when we confront Canada and say, look, we're going to have to impost tariffs to correct for these distortions until we negotiate our way out of them, and Canada's response is no, I'm not going to work with you to correct the distortions that I have in my markets. I'm
going to retaliate against you. That's not constructive, right. If we're going to move ahead with our trading relationships with our important trading partners, we have to have constructive discussions.
When Donald Trump was asked about this at the White House yesterday, he suggested that this is not just about kind of launching into a renegotiation of the USMCA trade agreement. But if there were to be some renegotiating on that happening, what would a better outcome look like for the United States in that regard? How would you tweak it?
Think? I think two key things that are driving the United States and desired outcomes for USMCA is the rules of origin. AUTO rules are the origin that's going to
be incredibly important. And this immense amount of not only Chinese investments in Mexico that are really working for the Chinese to circumvent the Section three oh one tariffs, the retaliatory terrorists that we imposed on them for IP theft, but also benefit from USMCA, to the point that the Canadian government has suppressed trade data so the United States can't determine how much circumvention is happening through Mexico. When the government does that to hide the ball from US,
then we've got problems. Right then We've got to have a serious discussion. You're not working in an alliance with US, You're working in an alliance with China, and we're going to have to deal with this.
We're hearing about tariffs against Russia. As Kayleie mentioned a bit earlier, I don't know what is there to teariff or to sanction after the last four years of all of this, Where does this come down to you? When Donald Trump talks to Vladimir Putin?
I you know, I think it's just ultimately a maximum pressure campaign. We do have a lot of sanctions on and we have sectoral import restrictions from Russia, and so at the end of the day in terms of volume, will it really materially impact anything. No, But it's a signaling too, a maximum pressure I'm going to impost tariffs on you, and by the way, Putin, I can impose
more sanctions on you. I think it's signaling to let President Putin know that the president has the tool test to deploy more tools to invoke a maximum pressure campaign on Russia until it retreats from Ukraine.
But isn't the problem with all of this that Russia to alleviate that pressure has been able to turn to China is that it is actually China where there needs to be tighter reinforcement of what China is still purchasing from Russia.
Absolutely, absolutely, how.
Do you do that?
Secondary sanctions?
Wait, absolutely, secondary sanctions, I mean China, what China has been doing with respect to Iran, right with respect to hamas with respect to Russia, is inexcusable. Every single day they're working to undermine our national security interests. Yet we still don't have enough Chinese company designated to the PLA Affiliate DoD list on the Entity list in sanctions on China. I mean, they barely exist when all of this is happening.
That is all of the work that the Chinese government is doing in Chinese companies who are in large part affiliate with the Chinese government anyway, working to embolden our adversaries to the detriment of US national security interests. It is just mind boggling that we haven't been imposing sanctions on them much more aggressively. Seventy percent of Chinese transactions are still in the US dollars, our mas. Our sanctions
have real impact. Let's use them to safeguard our national security interests.
Just to completely change the subject on you have a lot of experience in Washington that we can tap here as we spend some time together at the table. You were confirmed unanimously in the US Senate as an Assistant Secretary and Department of Commerce unanimously. There are a lot of questions about some of the votes that we're going to see for some of Donald Trump's cabinet nominees. What would that mean to see someone not get out of committee or not actually be confirmed on the floor.
You know, I think there's I mean, I'm sad to say that there's always a lot of gamesmanship on the hill too. Even though I was unanimously confirmed, I was put on hold because a senator wanted a faster imposition of the steal and aluminum tariffs, and our position was, don't you understand we're supportive of this. Led us through so we can help accelerate this. So it's a long way of saying lots of gamesmanship. I think that there's
points where objections aren't really meaningful objections. There's just to stall and retaliate or whatever, and so we're going to have to deal that. I think everybody in Washington knows that this is just a game, and you're going to have to now get industry support to overcome somebody putting on you on hold or not voting you out of committee. And everybody goes into these hearings prepared to kind of
play that game. And so I think that these cabinet members and the officials will get voted out of committee. It's just the question is how long and how much effort does it take to push back.
Very few Americans have ever done that dance, so it's really interesting to hear about NASA. Thank you so much for being back with us on Bloomberg TV and Radio. Kaylie will assemble our signature panel. Next, you have a lot to talk about with Rick Davis and Gdi Shanzino.
Yeah, including their reaction to an important conversation that took place earlier today at Davos between Ukrainian President Vladimir Zelensky and Bloomberg Zone Editor in chief John Mickelthwaite. Will have a bit of that conversation just ahead. So stick with us right here on Bloomberg TV and Radio.
You're listening to the Bloomberg Balance of Power Podcast. Catch us live weekdays at noon and five pm Eastern on Apple Cocklay and Android Auto with the Bloomberg Business App. You can also listen live on Amazon Alexa from our flagship New York station, Just say Alexa Play Bloomberg eleven thirty.
Welcome back to Washington, where we're always keeping one eye on the Newswire and another eye on the True Social feed of the forty seventh President Donald Trump, who of courses, in his second full day in office and on this day, has a message for Russia's Vladimir Putin, taking to True Social to say, I'm going to do to Russia, whose economy is failing in President Putin a very big favor, settle now and stop this ridiculous war. It's only going to get worse if we don't make a deal in soon.
He says, I have no other choice but to put high levels of taxes, tariffs, and sanctions on anything being sold by Russia to the United.
States, almost like a parrot. We can do it the easy way or the hard way, he says, and the easy way is always better. Question is what will the borders look like? What would a peace deal look like? Would it involve US peacekeeping troops? Because that's what Vladimir Zelenski said to John Mickelthwaye today.
Indeed, our editor in chief sat down with Ukraine's president at Davos and they did talk about Donald Trump. Here's a piece of their conversation.
President Trump is now on top, as they say, he had a strong victory in the elections and is now taking steps directed at internal politics. The issue of ending the war in Ukraine must be I believe the victory for Trump and not for Putin. Putin is nobody for him. America is way stronger, and Europe is way stronger. China is way stronger than Russia. They are all players.
I remember seeing a video of you when they had the talks with Putin before, when I think it was Merkle and Macron were there, and to the outside eye they seem to sideline you a bit that that particular set of talks. Do you worry that America will try and do a deal behind your back?
Maybe?
I very much believe that the US won't do that, although I'm not sure that earlier this did not happen here. I'm not speaking about America, speaking here also about some European partners. I don't know, and I'll be frank with you what I know. I know, and I'm always frank and sharing that the fact that the US and Europe communicated with Russians on the level of intelligence before the full scale invasion and during the full scale invasion, all that was in place.
Trump has said that he's arranging a call with Putin. From what you've just said, it sounds like you would be nervous about that or are you confident that President Trump will make your case.
I would put it in the following way. I think that for all of us who truly want to end the war, who want to end it fast, if that is possible, for all of us, it is desirable to have a plan until we have communication with Putin. I believe that this is in the interest of the United States, the European Union, Europe as a whole. It is in the interest of Ukraine and our people.
Ukrainian President Vladimir Zelenski in conversation with John Nicholthwaite today on Bloomberg are editor in chief bringing forth some pretty interesting headlines here in the ask for US peacekeeping forces before we even reach a settlement is an interesting stop on the road here we want to hear about from our panel. Rick Davis and Genie Shanzano join us our
signature panel. Rick is partner at Stone Court Capital Republican strategist, and Genie is our Democratic analyst and Senior Democracy Fellow with the Center for the Study of the Presidency and Congress. Rick Donald Trump is talking, he said that he would end the war on his first day. Now Here we are on the third, of course, and he's threatening new sanctions, new tariffs, and taxes against Russia. Will he get it done well?
I think he's going to do something. In other words, if Putin doesn't take the hint and enter into a discussion with Trump, then I do think Trump will start to tighten up on sanctions. And there's plenty that still can be done. Some of the criticism of the Biden administration is he wasn't tough enough soon enough to get Russia's attention. So I don't think Donald Trump's going to
follow that path of incremental steps. The fact that he is doing this right now, the very first week of his administer it should be a telegram to Vladimir Putin that he needs to respond in kind. I mean, we've already seen Vadimir Putin deny even talking to him after the election, which according to Donald Trump, a conversation took place, and no effort on Putin's part to take the offer of peace from Donald Trump seriously up until this point in time. I mean, this is more a threat to
get to the table. It's not a negotiation. For peace and so until at which point in time by the Trump administration finds a way to get Vladimir Putin motivated to want to have that conversation. All this talk about peacekeepers and what will the peace plan look like are irrelevant because right now there's no counterparty to these discussions. Vladimir Putin does not seem ready to negotiate peace.
Well, and Genie, I wonder if that is a not motivating factor, a factor that could suggest Vladimir Putin that he might not have to go to the table for some time because he knows the person who has just sworn in as Vice President jd. Vance, as well as many of his former colleagues in the Senate and in the House, are not willing to continue to provide financial
support for Ukraine. So is there an argument that says, Okay, Donald Trump, you can threaten all you want, but I know I can wait this one out.
Yeah.
That's always been the concern is the fact that you have many members of Congress, and now, as you mentioned, the new Vice president, who including Donald Trump by the way, who aren't inclined to spend more money supporting Ukraine at this point, And that gives Vladimir Putin. What he has
always wanted and needed is the time necessary. He predicted that the West, the US and its allies would tire of this at some point we would stop funding and Ukraine would be his and so that time does benefit him. And I think what we also see here is Donald Trump making the mistake, which is number one, you can't negotiate the end to a war on social media. You
can't negotiate it. As Richard Blumenthal said via bombbast you have to get the parties to a table and the table, and he is not have the Ukrainians at the negotiating table in a position of strength at this point. They both need to be there, and so he is going to undermine what he indeed wants to see happen, which is an end to this war quite frankly before he even got into office, which was his promise, and of course he didn't deliver on that.
Well, from that, this can be easy or this can be hard file That line was also used by John Thune yesterday, the majority leader in the Senate is promising to keep everybody here for weekend attention. They will keep the chamber in session for the weekend as Democrats try to slow walk some of the confirmation votes for Donald Trump's cabinet nominees. Rick, I'm sure you saw this. John
Ratcliffe's nomination was blocked yesterday by Chris Murphy. A vote was at least even though he was approved fourteen to three in the Intelligence Committee. They've also put up some procedural hurdles for Pete Hegseth and so John Thune says, you want to vote on these Tuesday, or want to vote on Friday and Saturday, And it looks like based on the calendar, they will have to stay the weekend to make this happen. Rick, you were a longtime creature
of the Senate. What does that tell you about the overall momentum for Trump's team.
Yeah, kudos to you, know, Senator Thune, the majority leader for calling a question on this. I mean, if the Democrats are going to play procedural games to try and slow down what has been a meteoric confirmation process, then they better have good reason to do it. And the other thing that Stiffen's Thune spine on this a lot
is the threat of recess appointments. And this came up in the conversation as I understand it a to the reports that when he met with the president, President said, you know, look on you know, if this doesn't get going on the confirmation process, I'll be happy just to recess appoint all these people. Now, if the Democrats want all these cabinet members without a debate, without a vote, and just put in through recess appointments, then the strategy
they're doing will work just fine. And if they want to, you know, complain about that, it's at their own doing. So let the process continue. The one thing that would be strengthening all the normal hands of state would be to get back to a regular order process and to actually not be seen as slow walking initiatives. Just take the vote if you've got the votes to beat it, fine, if you don't take the vote, and keep moving.
Well.
On the subject of alloming vote, Pete Hegseth Genie, the nominee for Secretary of Defense, did make it out of the Arms Star Serviss Committee. He was able to get through that vote. A full floor vote is yet to be scheduled, and in the meantime, senators yesterday received a sworn affidavit from his former sister in law alleging that he made his second wife fear for her safety. We should note that wife says he was not physically abusive
toward her. But do you see this as being a new factor that has entered the conversation here that could actually change his odds of confirmation.
You know, I don't think we have signs yet that it changes the vote. I haven't seen any signs that Republicans who have been willing to go along with Pete heg Seth's nomination are changing their mind. We do know that this was the work of a Democratic senator who felt that the FBI background check was not thorough enough, and of course was released to the press. But I
don't see this changing things. But the reality is the longer this takes, the more likely material like this comes out, which is why of course Senator Thune wants to move this forward as quickly as possible and get Keete heegsas potentially confirmed this weekend. And of course the other two are Tulci Gabbert and of course RFK Junior, who really doesn't seem to be signs that they're moving forward with
their hearings at this point. They haven't been on the hill, so that is another curious element of this that we have to watch and see what happens to those two, because at this point I think Gabbert is the shakiest among Donald Trump's nominees, whether she'll get support or not.
Of course we're watching Cash Bettel as well. Rick. He's got a date a hearing set for January twenty ninth. Earlier in the broadcast, we played a clip from Enrique Torres, the former leader of the Proud Boys, invoking Cash Betel's name in an interview with Alex Jones last night. Is this going to be the real fireworks out of all these hearings?
You know, it's hard to tell. I think the thing with Cash Battell is he's been very consistent about this for four years. He was outspoken about what he thought were campaign irregularities, election irregularities. Back in twenty twenty. He was the tip of the spear for the Trump efforts to try and you know, overturn certain aspects of the
election counts. And so you know, it doesn't surprise anybody that he's he's the guy who's you know, in the debate now because of these January sixth, you know pardons, Yeah.
We'll be glued to that hearing next week. Rick Davis and Jeanie Shanzano our signature political panel. Thank you so much for joining us. And there's still more ahead here on Balance of Power. Former House Financial Services Committee Chair Patrick mckenry is on his way in next Right here on Bloomberg TV and Radio.
You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and five pm Eastern on Alma Cockley and Android Otto with the Little Birk Business Up. Listen on demand wherever you get your podcasts, or watch us live on YouTube.
In the Nation's Capital, I really have to catch up on Squid Game to see the second Squid Game. We're like the only two people you know about the first one. Oh wow, you have a whole weekend planned. It's very cold down here in Washington. Much to discuss today, A lot of questions that we've been asking for days, weeks actually, when it comes to the congressional agenda, sequencing, how reconciliation is going to work, what do we do with the
debt ceiling At this moment, we still basically have no idea. Yes, and while we're at it, and that's despite a meeting between Donald Trump and congressional leaders Republican leadership in the White House yesterday. While we're at it, he's also kind of making fun of Mike Johnson's slim majority, which he is somewhat responsible for having tapped. I believe three members of the House Republican Conference to join the administration. Remember this from Monday.
Congratulate Mike Johnson for the job that he's doing. Stup, We gave him a majority of almost nothing, and then I said, to make it tougher on him, let me take two or three of the people, right, I said, he'll only have to suffer with that for about three months. How are they doing, by the way, are they?
Is that moving along?
Uncomfortable? After I don't know what They're just saying the quiet part entirely out loud at high volume to a very crowded Emancipation Hall on Inauguration Day. But we want to talk more on the path ahead and the House of Representatives specifically, was someone who for a brief period of time actually held the gavel to control the House, at least on a temporary basis, the former chair of the House Freedom Caucus and former congress or excuse me,
how's financial Services Committee. It's because of the question I'm about to ask you, sir, I apologize that was a Freudian slip. Patrick McHenry, that is correct.
My friends would have loved that, would have loved that I said that.
The question I was going to ask you is Mike Johnson's problem. He has people like those in the House Freedom Caucus. He also has members like the ones meeting with Trump at the White House as we speak, the frontliners who are actually in blue districts, Congressman Lawler Bacon Fitzpatrick. How does he get both of those groups to agree on one thing, to tally all two hundred and eighteen votes.
That's the art form.
That's the art form, and that's how you make the box. What I love about the clip that you showed is that is quintessential Donald Trump. He knows the complaints behind closed doors, and rather than just let those complaints fester behind closed doors, he's the one making the joke about it and forcing the person in an uncomfortable position.
To laugh about it, which is so rich. Does that cut the tension?
It does cut and also is a warning shot that you can complain behind closed doors, but there are no closed doors in this town, especially in this era. So Mike Johnson's challenge and the House representative challenge is navigating this pathway to what is essential and what is consequential in the timeframe that they have and focusing those high priorities means that you can actually get that narrowband done okay, but the secondary issues are going to be more difficult
to get done with this really diverse Republican conference. You have those three members you mentioned, Fitzpatrick, Bacon, and Lawler are in Joe Biden districts, yet one in this election. If they were not members of the House Representatives, wed not have a Republican majority right now, and the whole
legislative agenda is dramatically different. They're at the White House today making it clear that their colleagues and friends at the House rather than just staying in the meeting, They're going to have the meeting with the President to elevate this. So members of the House and their colleagues understand they need to listen to them. The Freedom Caucus has a dominant voice right now, and they're able to capture a lot of media attention around their group that is semi unified.
The moderates are the ones that are unified, and they're unified on making sure that this is a high priority economic agenda and that what we achieve on those social issues are things that are actually broadly popular with the American populace. And I think that is important to remember. There are popular measures that Donald Trump is all about. The border policy highly popular, economic policy on taxes and
spending highly popular. You get into all these other secondary issues, though, that is where we're not going to have unity among Republicans.
Interesting, you know, there's a thought that Donald Trump simply needs to tell them what path to take. Put your foot down, tell them you've been in the Speaker's office when the phone rings and it's Donald Trump. Does he care enough to say, get it done in one bill and start writing the legislation, or he seems to be saying, you know, this is what I want, but you guys can figure it out too, and we're losing a lot of time.
Well, he recognizes it's a coequal branch of government. It is his bully pulpit that enables policy to move on Capitol Hill. It's his prioration that enables policy to move on Capitol Hill. But the details of that that's not his business.
That's not what he does.
It's like he has a contract lawyer, he has a deal lawyer. He has a variety of people that he has doing things like that. But he's going to go focus on the big picture item. And the big picture item here is he wants a reconciliation bill on his desk as quickly as possible, with as much policy in it as possible. I'll leave it to you, right And so that leaving it to you. The Senate wants to do two bites of the apple. The House wants to
do one bite of the apple. Reconciliation is designed for the Senate procedure to make it easier, so the Senate on one bill or two bills a year. The Senate can act like the House of Representatives and have a majority vote and an act policy. It means that the art here is in the Senate and the Senate wants two bills. Trump thinks, I don't care. This is not of priority to me. I've got high priority issues, not a question of do you send me two bills or
one bill? To just get everything you can get done done and I'll be happy.
Well, and one of those things that they're going to have to get done. In the middle of all of this is at some point lifting the debt ceiling, because you, as former chair of the House Financial Services Committee, know what could happen if we even approached the X state, let alone going over it, which we've never done before.
How do you see that getting resolved? Knowing how difficult it was last time, it was one of the precipitating factors, and you ultimately temporarily serving as Speaker of the House, how do you see this falling into the legislative picture.
Well, it needs to get done, it needs to get done quickly, and the longer it goes, the more likely that the president gets leveraged. Joe Biden had Democratic majorities in the House and the Senate. He could have raised the debt ceiling with zero trade offs with his majority. They chose not to, and so they had to negotiate with Kevin McCarthy and Kevin McCarthy opened up the negotiations the first week of a speakership and it took four weeks. I'm sorry it took four months for it to be done.
And it took three months to actually get Joe Biden to even egleged that he had to negotiate with the Speaker of the House to raise the debt ceiling. We had to pull them kicking and screaming, and we did. And Democrats in the final bit of negotiations with the White House, I was in a meeting and one of the Democratic negotiators said, there is nothing in this for Democrats. I said, yes, that's the point we are driving. Republicans are driving the policy making well. What Senate for us
raising the debt ceiling and avoiding default. So we had spending cuts paired with changes to the social safety net, entitlement reform, and regulatory changes that make it easier and faster to build in America. These are popular things that we leveraged in the debt ceiling and drew the Biden administration along with Trump. What the Democratic members of the House and Senate want to do for their votes is
to raise spending, to increase spending. That is not as popular as cutting spending in America today, and that is not commensurate with the presence commitment to the American people. So the longer this draws out, the more likely the Democratic members get their leverage point to raise spending.
Well.
And Donald Trump suggested the fires in Los Angeles make this whole thing easier. Do you see that as being realistic leverage? That that's how you get the Democratic votes by essentially withholding emergency aid in lists.
Let's not withholding right now.
Congress still needs to appropriate for hurricane damage in the flooding in the southeast that is not yet done. That was unfinished business of November and December of last year. So naturally, with a massive damage and around Los Angeles with these wildfires, we need a disaster Aid supplemental bill. It would fit to attach the dead ceiling to that measure to get it done quickly. It would fit to attach to the reconciliation bill to get it done quickly.
It would fit for it to be a part of the government funding bill that with government funding running out and in a couple of weeks, all those things fit with the debt ceiling. It's just a question of executing in a timely way and for the leadership in the House in the Senate to make that decision.
Maybe not withholding it, but using it as leverage. I think is where Kayley was going here, right. Donald Trump said last night when he was asked did you reach agreement? It said pretty much, a lot of Demos are going to be asking for help. We're going to take care of la. The Speaker of the House echoed that sentiment on Fox News last night that you put these together here and well, Democrats are going to have to vote to raise the debt ceiling or whatever else it might
be attached to. You're from North Carolina, Your state was hit pretty hard by some of those storms. Is that just the way things work in Washington? You comfortable with that construction?
Well, you think that it's leveraging Democratic members to vote for bills that the Democratic members normally vote for. Democrat members of the House are accustomed to voting to raise the debt ceiling without any pay for, so then there's they're customer voting for government funding bills as well. House Republicans have a much more difficult time much. It's much more a challenged vote for a Republican to vote for
government spending, even if it is less government spending. They have a very difficult time talking to their constituents about it and to say, yeah, I did vote to fund the government, but I'm funding it at a lower level. We are saving money, And they said, well, how are you saving money by spending money, because we're not going to turn.
The lights out on the government.
And it's harder for Republicans to articulate that it is a jam up vote if you attach anything to disaster supplemental bills. But disaster supplemental bills always have something attached to it, and there is no pure vote in the House or the Senate in any era of Congress, but especially not right now.
I want to switch gears here because you obviously spent a lot of time in Congress. In your time in Congress working on crypto specifically, and we have now learned that Hester Purs, Commissioner at the SEC, is going to be leading a new task force on this at the Commission on Digital Asset Regulations. We knew this administration was going to be taking a different tact than the prior
one on crypto. But what do you expect to see out of this SEC, in particular in the absence of market structure legislation happening before here.
Well, there are things that the agency can do, and Commissioner Purse is steeped in understanding of securities law really deeply understands a crypto and digital assets and understands what is in the art of the possible under current laws for the Serious Exchange Commission, it makes complete sense for hester person to run this deep look at this deep dive,
and it's needed. It is about a decade past due in fact now absent Congress legislating though for a market structure built, you're still going to have this divide in this rub between the Series' Exchange Commission and the CFTC of what is a digital asset, what is a digital commodity, what is a digital security? How do you find those things? And there's there are clear things that need to change under law for the CFTC to have spot market authority
so they can properly regulate a crypto native marketplace. So there's things that Congress still has to do, but the agency should be fast at work and prioritize very important things, especially starting with custody, so that people that think they own crypto in fact do own crypto and it can stand alongside similar assets and they're protected from bankruptcy proceedings
and things like that are not really partisan. They became partisan because of Gary Gensler's regime at the Securities Exchange Commission and because of a statement they're trying to make about crypto absent that there's some reasonable things the SEC should should be about. And I think Commissioner Purse will find those things.
We have less than a minute, so you're saved by the bell. Does trump coin show, by the way, blania coin help to delegitimize serious.
Look meme coins are they have another handle for him? Another four letter word?
I heard about that. Yeah, okay, I think that's your answer. Can't say it on the air, And yeah, I'm trying to hold back.
But all these meme coins really undermine what I think of is what is digital properties that can make a huge difference over the long term. But people buy it?
Yeah, who are interested in it?
And I wasn't into beanie babies, but perhaps this is digital beanie babies.
Former chair of the House Financial Services Committee, he held the speaker's gavel. That's Patrick McHenry with us at the table. He never ran the Freedom Caucus. Come back and see us soon with hilly lines. I'm Joe Matthew. It's all good. This is Bloomberg.
You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and five pm Eastern on apple Cocklay and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station Just Say Alexa played bloom Were at eleven.
Donald Trump making news on the war in Ukraine, telling Vladimir Prutin to end the war or face a new wave of punitive measures, think tariffs, taxes, sanctions. What is there left to sanction? You ask, We will seek answers here, as he writes on Truth Social we could do it the easy way or the hard way, and the easy way is always better. Now. This comes against the backdrop of a conversation with President Zelenski himself of Ukraine here
today on Bloomberg. This is something you will not hear anywhere else, generating the headline US must be part of Ukraine peacekeeping Force, part of his conversation with Bloomberg's editor in chief John Micklethwaite. Let's listen.
It's great if we will have troops, but we have to understand that the troops will not be in the center of the capital. Yes, they will not have relaxed time. Yes, it's it's very important because I heard them some allies said that, yes, But it's okay. We can be in the center of some city and no, no, no, we don't need such contingent contingents. No no, yes without without without with our people. Of course, yes, because this means security and and that's it. So, but it can't be.
It can't be without the United States. I will explain you why even if some European friends think that it can be, No, it will not be. First of all, nobody will risk without the United States. The second, that's what can divide. Need to divide EU and USA. That is a goal and dream of putting to divide this unity.
You mentioned China. How important is in these negotiations. I mean, China is the backer of Russia. They seem to have had an impact on things like Putin not using nuclear weapons. Those are the things. Can China push Putin? And do you have any contact with the Chinese?
I had some contacts with the Shin Jipin. We had phone call during the war, not to watch not enough. I think yes, he can push Putin to piece.
I'm sure.
I think that only President Trump is strongest and shin Zimpion. I think that there's no other allies who can really do it. Yes, because his economy put in after sans everything depends very much of China.
You would like Donald Trump and of China to work together to h I think yes, yes, but not without us.
It's important.
Ukrainian President Volama Zolenski in conversation with John Mickelthwaite, our editor in chief here at Bloomberg they met in Davos. Pretty remarkable language coming from Zelensky at a very important point here in its struggle against the Russian invasion. It can't be done without the United States. The enduring headline as we bring in the voice of experience in Kurt Volker.
I'm glad to say the ambassador is back with us here, former US Ambassador to NATO, former US Special Representative for Ukraine negotiations, back at another critical time twenty seventeen, twenty nineteen. Mister ambassador, welcome back to Bloomberg. It's great to see you here. I'd like to just back up to where we started and what we heard from Donald Trump today, threatening new sanctions and tariffs against Russia. He said he would end this war on day one, and he was
asked about it. He said, well, I've only had a half day. Do you take seriously this attempt to end the conflict.
I do.
I do.
And if you listen to what you read out at the beginning of this segment here where Trump is tweeting to Vladimir Putin, you can do this easy way, or you can do this the hard way, and the easy way is always better. This is very, very smart. It is doing exactly what he should do to demonstrate that he is in a stronger position than Putin, that he wants to end the war. He knows the only reason there's a war is because Putin is causing the war
and he wants it to stop. And giving Putin an opportunity, Okay, you come to a table, you figure this out, you end this war. We're going to do this. I think that Trump is exactly on point here. I was very disappointed to hear President Zelensky just now because he missed a great opportunity to say nothing. Trump is doing exactly the right thing here of putting the pressure on Vladimir Putin,
say you end the war. It's not the time to be making demands, to be saying the US has to be present on the ground, to be defining in advance what a detern force in Ukraine needs to look like it is time to align with President Trump and end the war. That's what we need to be focused on.
Well, that's fascinating to hear you say all of that. And when you envision the future map of Ukraine, are the borders in place where lines have been drawn? Now?
Yes, So here's the way I think of this. Ukraine's international borders were recognized by the entire world, were recognized by Russia in the nineteen nineties. They were confirmed by Russia in the Budapest Memorandum of nineteen ninety four. So those are Ukraine's international borders. Russia temporarily occupies about eighteen percent of Ukrainian territory. That's unacceptable, and I think we can say that we disagree, and Ukraine can say they
do not accept Russia's occupation. They can even put it in their constitution that they should get these territories back. A different issue is where whether you have a war over that right now, Putin should not want a war. As Trump has said, he's in a very bad position. He's destroyed Russia, he's destroyed their military forces. He needs to stop it. Ukraine is in a bad position as well.
They can't take these territories back militarily, so we can have a long term dispute, very much as we had with West Germany and East Germany, where West Germany had it in its constitution about the unification of all the Germans and they didn't unify until forty years later when East Germany fell apart and became part of modern Germany.
Same thing with the Baltic States. They were occupied by the Soviet Union for forty years, but they got their freedom back and now they're again independent sovereign states, part of the EU, part of NATO. So that's the way to look at the territorial question. But the first step here is what Trump is focused on, is end the war.
It's interesting to hear Zelensky appeal to not only Donald Trump but Shesian Ping for assistance here. And I wonder, if you close your eyes, can you see a Yalta conference with Donald Trump, Vladimir Putin, Xesian ping? How does this end? What formed are these tops tas?
That would be a nightmare. That would be a nightmare if my eyes were closed, and that's what I saw, I'd be having a nightmare that there is no reason to be talking with Vladimir Putin about things that he should have no say over, and the future of Ukraine as an independent sovereign state, whether they joined the EU, whether they join NATO, whether there is any kind of foreign military presence on their territory. All of these things are up to Ukraine, They're not up to Russia. So
we should not be negotiating about that. What we should be doing is exactly what President Trump is doing, which is sending a signal that we have plenty of time, plenty of capability, plenty of will, and this is not going well for Vladimir Putin, so he needs to end the war. That's it just ended, and then the we can move on from there. As for China, you mentioned that I think China has played a mixed role here. I don't buy the assessments that China is fully in
Russia's court. They have not provided direct military aid to Russia. They probably want to take part in reconstruction in Ukraine. They do not like the comparison of Russia attacking a sovereign, independent country and taking territory, as compared to China with their efforts to retake Taiwan, which they see is very different from a legal perspective. So I think China is uncomfortable with Russia's behavior. They'd like to see it end as well, and they'd like to be positioned to have
a relationship with Ukraine. So I think that Zelenski is actually smart to make a little bit of an appeal.
To she as well.
I've only got about a minute left, Ambassador. If indeed we're looking at the lines that we're going to have, at least in the initial phases of a ceasefire or negotiated settlement, here, should we expect a settlement to include NATO peacekeeping forces along Ukraine's eastern border.
I don't think that's the way to think of it. We're not there yet. I don't think anyone has given this serious thought. I think putting Western forces along a ceasefire line facing Russian forces is not the way to go. I think there are many, many, many more Ukrainian forces that are capable of holding a line, and what we need is a presence in Ukraine as a deterrent force to deter Russia from further attacks aim at taking over Ukraine.
And they could be anywhere in Ukraine, and they could participate in different roles such as air cover, air defense, including ground based air defense.
They could be doing a lot to.
Work with train support, equip empower Ukrainian forces who are already very capable and can hold a front line with that kind of support. So I would look at it more as a deterrence force. I look at it as a stepping stone to Ukraine NATO membership. We may not get there in a day, but we can get there over time. And I look at this as a way of stabilizing Europe again, because as long as Putin thinks
he has more to gain, he'll keep fighting. And what we need to do is convince Putin there's nothing left to gain here.
Always learned something when we talk to Kurt Volkler, ambassador, thank you. It's great to have you back. He's worked for Democrats and Republicans, former Special Representative for Ukraine negotiations, and the Trump administration is Ambassador to NATO in the second Obama term. Make that the first. 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.