Hi, I'm Molly John Fast and this is Fast Politics where we discuss the top political headlines with some of today's best minds, and it costs Steve Bannon more than six hundred thousand dollars to ignore the January sixth Committee. Welcome to our one hundredth episode. Today we have an incredible show with the House Minority Leader Hakeem Jeffries. He stops byded talk to us about the debt ceiling and banning congressional stock trading and a plethora of other issues.
Then we'll talk to squat Box's own Dan Nathan about what's going on with our economy and the markets. But first we have the host of the time of Monsters the Nations. Get here. Welcome too, Fast Politics, your friend and mine get here.
Good to be on.
I'm such a fan of yours. I want to ask you about the most recent So Me Too movement, which was I think supercharged by the election of Donald Trump. Has now got this Adult Survivor Act which was extremely important, which just begot the first ever Trump being held responsible by a jury for sexual assault to the tune of five million dollars for his favorite activity, defamation. Well, it turns out Trump may not be the only one.
Well, I would want Trump not to the only one. I think a lot of men act like the way Trump does. And if there's one good thing what he can say about Trump, he's discredited the idea of male supremacy. Hopefully there'll be many more targets.
Well, we've stumbled upon one target. You may remember him from the bar At movie one. Rudolph Giuliani, America's mayor.
Wait are you saying that Rudy Giuliani did something bad? Let me compose myself here. Second, Okay, I just he's America's mayor. He's like Time magazines Man of the Year two thousand and one.
Oh Jesus Christ. I mean you read that filing. There is not a single thing in that filing that, in my mind seems basically I read it and thought, oh, that sounds about right.
Yeah, no, absolutely, And the accuser in this case also has apparently tapes.
Because I think there's a huge quantity of tapes, a huge.
Quanity of tapes.
But also, like I mean, this is like in keeping with a lot of stuff that we already know about Juliani. As for my comment, you know, of pretending to be shocked, including the movie. It's not like Giuliani. I mean again, to give this guy a little bit of credit, he hasn't quite hidden who he is.
So yeah, none of this is surprising.
I think the one thing that made made me raise my eyebrow a little bit was not, like, you know, his claim that he was like selling pardons and splitting the loot with Trump.
For two million dollars a pardon, yes, continue.
That's a yeah, that's totally full acceptable. The racism and anti semitism doesn't really surprise me. The sexual harassment doesn't surprise me. The one thing is that he said like about Passover, you know, like why can't the Jews get over it? It wasn't even the first time the Red Sea was parted, and that actually took me by surprise because it makes those sense.
Can you explain this?
Yes, as a Jew, I'm happy to tell you that.
No.
I mean, the man is like drunk eighty percent of the time. I mean, it's just all sort of baffling to me that you know, he's gotten this far. But yeah, it all of it is impressive.
Can we nail this down?
Because I'm pretty sure I'm going a little bit by my memories of the Ten Commandments, but I have also read the Book of Exodus. I just remember one party, like, like, am I missing out on something? Is Juliani in on information that I don't know about? Like how many times did the Red Sea part?
I think it's fair to say that Juliani is never, never in possession of information that you do not have.
Okay, Okay, good.
Okay, it's a fair assessment.
Okay, I'm glad to be clarified on that.
But I do think it's pretty interesting. I mean, it's interesting in the fact that, like the fact that Rudy Giuliani continues to make news and it's bad news for Trump.
It's bad news for Trump. Although I also have to say it also raises to me, like the perennial question, which is what is Merrik Garland doing? Because we have, like, you know, this close associate of Trump who apparently has been doing all sorts of crimes and there's like apparently tapes all this. Why has there been such a slow walk of the criminal investigation and why is it being left up to private citizens and also to local DA's to be the ones that are going after this?
I don't know.
I mean like they're real questions because some of this stuff is not just Giuliani stuff, it's also implicates Trump, right, and I just have to wonder, like, I honestly think Merrick Garland is like the weakest link of the binding admistery.
These things are rape. I'm sorry, but forced sexual conduct is rape. There's not some like lesser rape for people who are famous, right, I mean, of course, unlike you know, Trump does say fortunately or unfortunately, no millions of years.
Millions of years, yeah.
Right, fortunately or unfortunately, but that is still actually sexual assault. Fortunately or unfortunately. Look the pardon selling. I mean think about like normal people go to jail for things like floating this idea, you know, I mean the fact that Trump sort of definitely gets a whole other level of justice is kind of amazing.
No, it is amazing. And I think there's two sides of this, which again, on the one hand, the people who should be doing this the deferment of justice, see to be slow walking everything. On the other hand, I think that there's like a lot of your ordinary people women who've been assaulted by Trump and Juliani, and also like local prosecutors that are actually like taking the mantle and are actually trying to bring kind of justice to this, which is the more heightening fact, But.
It falls to the women again, just like with Egene Carrol, Right, I mean, yeah, so far the only accountability we've seen, right, the only time twenty five Trump accusers and only one has ever been ordered a payment from a jury.
That's right.
Yeah, I'm I'm hoping that there is a kind of Overton window effect as people see that Trump is actually vulnerable on these things, and hopefully Giuliani is also vulnerable on these things, that more women will go forward. But I think your point is exactly like, like, why is this falling on the women to clean up this vest.
Right when you have these powerful departments in the United States government that really could Another sort of interesting data point that I want to talk about is the fact that Juliani I was watching Lawrence's show last night. He's a good friend of the podcast, and Lawrence had on it a clip of Sacha Baron Cohen talking to Ben Affleck about the Borat movie where famously Rudy went into the room with the girl who he thought was sixteen, right,
and put his hands down his pants. Haha, hilarious, but what I thought was really interesting about this was Sasha bart Cohen said, actually I wanted to go in there because I was really worried about this actress.
Yeah, yeah, I know.
That's uh boy, that's really something. It's a legitimate worry. I mean, I think at the time people said Cohen kind of set this up, but it was a very disturbing scene of the movie. But in keeping with like, you know, a lot of behavior that we've seen when Giuliani, what's striking about the current filing is just how similar it is to everything that we already know, including from Borat.
Right, No, I know, but it's it is weird to use Borat as a news source and puts this in a very trumpy kind of you know, as much as I love Sasha Baron Cohen, it feels like Borat should not be a news but it clearly is here.
Yeah yeah, yeah, But I mean it maybe raises again these larger questions of who's holding accountability, because I got to say, like, if you just followed Giuliani around and look at his statements, and as you noted, took note of the fact that eighty percent of the time he seemed, you know, his brain was pickled out of its mind. You could have had like a little bit more reporting, like not just this comedy movie that did it. There could have been more scrutiny of Giuliani all along from
the media. And I just see a lot of this, as you know, there's a wider institutional failure that allowed these guys to have impunity for so long. And I mean that's why I mentioned the Time magazine Man of the Year two thousand and one, because I got to say, like I understood after nine to eleven, you know, there's a desire for heroes.
He was Mayor of New York at the time.
But you know, like anyone who had followed Giuliani knew that he was not the guy he was claiming to be, and he was not the guy that the mainstream media. We're not talking about Fox News, We're talking about Time magazine and the New York Times we're building him out to be. And a lot of his problems, the fact that he associated himself with, you know, like criminal elements, skirted the law, and often like made very racist statements.
A lot of that was known from the nineteen eighties and nineteen nineties.
Known for years. Yeah, and his dubious connections with organized crime, which the needle was never able to be threaded. But it certainly seemed like this man would be a poor choice. I think that's a good point. What I want to ask you is, here we have a situation. Last week the Republicans in Congress, known for their reasonableness and good common sense, found that basically exonerated Biden from the fake controversy of his son's possible laptop. And then we had the Durham Report, which showed.
Well, what does it actacy show the weird thing because.
This is nothing he weighed at six and a half million dollars in taxpayer Monday.
Yeah, and and like it actually took much longer than Themueller report to come out. And with Mueller, I mean, one could argue that the results were disappointing, that he didn't go deep enough. But actually, I mean, Mueller, to his credit, you know, got a lot of indictments and you know, did like actually document a pattern of obstruction of justice which should have supported like an impeachment. I got to say, yeah, with the Durham Report, this guy was obviously on a fishing expedition.
He found like very little.
I mean, there was some FBI misconduct, which I don't think should surprise anyone. But here's the my bottom line, and this is like what I find like really puzzling here, which is that the major FBI intervention in American politics in our lifetime was the way that they helped Donald
Trump win the twenty sixteen election. Right of course, of course, Firstly, since then, we've had the Republicans like treating the FBI is an illegitimate organization because they would be the ones charge with investigating Trump, and conversely the Democrats kind of defending them, which I understand, you want to defend the organization that's under unfair attack, but I mean it's still
such a propose outcome. I mean, I saw Josh Howley, Senator from Missouri on Fox the other day saying, you know, the FBI is a threat to American democracy, you know needs to be reined in, which like I kind of agree with, but I agree with with.
Because of what they did in twenty sixteen, but.
Not for the same reasons that stuff is incredible. I mean, I do think they're very good at messaging. We all know that there was a real problem there and that the FBI during the Hillary I mean, you know that comy letter, we know what it did, and yet somehow the Republicans are mad at the FBI. I mean, it's just incredible.
It's with unwrapping.
Why that is because their idea is AFV should always be on their side, yes, right, and that should it should be their tack dog. And like, historically, I think, you know, there's really good reason to think that that's
what the FBI has been. Historically, that's been a very conservative organization, certainly under j Edgar Hoover, but every single FBI director has always been a Republican, even those nominated by Democrats, and has often been used as a weapon against the left, you know, including the civil rights movement,
the anti war movement. So the fact that underwent the Durham Report and with Trump in general, that they're going after the FBI is just because they cannotstand the idea that this wonderful attack dog that they've used against liberals and the left for like fifty years is now now sometimes going to be used against them.
Yeah. Absolutely incredible stuff, and you know we live to see it. So I want to ask you, the Republicans in the House seem more unhinged than ever, I don't know if you saw Marjorie Taylor Green has started impeachment proceedings again, this time on whoever. Basically every hearing she just starts impeachment proceedings.
That's right, Yeah, well, I mean the thing is like she's the real kingmaker because their majority is so small, and it's actually getting smaller. I mean, I think now that Santos is illegal jeopardy. I don't know if they could rely on him, which means that like the smaller they get, as long as they have some bare majority, the more power Marjorie Taylor Greenhouse like, that's just the dynamic.
Yeah, I mean, it is truly incredible stuff that that crew has taken over. I mean, let's just like game this out for two minutes. So we're gonna see a lot of horror. I mean, my guess is we're going to see a summer of horse race journalism about Desanti's v. Trump, right, even though we know Trump is going to be the nominee.
But they'll be like, I mean, I don't know if you saw this weekend, there were there was bad weather, so Trump decided not to hop on his plane to go to Iowa, and so there were a couple stories about how DeSantis took this as a win. I mean, this is just like these are machinations because everyone's a little bored, right, Yeah, no.
No, absolutely. I mean the thing is Trump doesn't need to go to Iowa. I mean, he gets all this free media from CNN and other outlets. And we've constantly seen DeSantis even before he's announced, he's like sinking in the polls, and he's like the most recent ones I saw in Kentucky where like Trump at seventy, DeSantis at like fourteen or fifteen, and then like you know, people
like Pence at like four or five. So like DeSantis is actually much closer to like the sort of you know, people who are barely in the race than he is to Trump. And yeah, I mean we've talked about this before, but it's just the simple structural fact is that you can't run as a trumpest candidate against Trump. It's like if you have the choice between going to see Elvis and going to see an Elvis cover band, Like, what are you gonna pick?
I mean, come on, I also feel like it's like you have a choice between seeing Elvis and see a guy who pretends to be Elvis fights with Elvis and hates Elvis.
That's right, that's right, And it's totally lacking in charisma and has a weird laugh and can't sing.
Right the tone deaf Elvis. Yeah, and you're like, which would you rather?
Yeah, it's not just see Elvis versus a cover Elvis. It's like Elvis versus a bad cover Elvis.
Right, all right, now, it is incredible stuff. And I just am a little bit curious as to how you think this goes. You think it's a summer of fake horse racing and then Trump gets the nomination and he runs against Biden.
Yeah, I think so.
I think the only X factor, which I think is what the Santa is actually working on, is that something happens to Trump and he has to withdraw, like right, you know, like the guy is getting up there, as are many other American politicians and so like, you know, I think Desantra's only plausible strategy is you know, like that Trump keels over and dies, which is not actually like I plausible, right.
Right, But it's not a great strategy.
No, no, no, it's basically you know, like being the second Prince, right, like you know, like it's like being Harry or whatever.
I mean, yeah, exactly, it's like being Harry but without I mean, the thing I love is when Trump like tries to appeal to DeSantis and he does things where he's like, well, he's very young. And then my other favorite thing is that there are a couple of people who have decided that they're going to run again, and they are like the only people less exciting than Mike Penance. Right, So we have Chris Christy, the guy who got COVID from Trump or from helping Trump prepare for the debates.
He's going to run as the anti Trump, right, because nothing matters. And then you have his energy secretary, right, who's also going to run.
Yeah, no, no, I mean, like there's nobody running that has, as far as I can see, any traction. And I mean the sad thing is for them that Dessentis is actually their best hope and he's kind of plailing. Yeah, I just don't see any alternative, you know, like unless Trump steps on a banana peel, you know, I don't know.
I mean, I mean this just validates the sort of success of Trump in taking over the party, but also that no one else has quite Trump's magic and We actually saw that in twenty twenty two, where a lot of like, actually, you know, the people who tried to be most like Trump did actually poorly. And I think that's a's the you know, a sort of optimistic note that we might want to make note of it. I mean, it is very troubling that a figure like Trump can
leverage his celebrity to take over a political party. It's also the case that like that doesn't seem like a model that can be copied.
So true, Jeed here, I hope you'll come back.
You can't keep me away from you, Molly, you are the best.
Hakeem Jeffreys is the House Minority Leader and represents New York's eighth district. Welcome to Fast Politics and our one hundredth episode we get to have you. Welcome, Congressman King Jeffries.
Well, great to be on Monley, particularly for your one hundredth episode, and congratulations on that wonderful accomplishment.
Thank you very much. It's very exciting. So I want to start by asking you about the dead ceiling. I'm sorry, Okay, where are we? What's happening?
Well, our position continues to be clear, which is that America should always pay its bills. The dead ceiling relates to ensuring that debt's and expenses and bills that have already been signed off on by the Congress should be paid and paid on time, and any effort to try to extract a ransom for doing what has been done consistently for decades under Democratic presidents and Republican presidents is irresponsible.
But of course, in a given year, we always have a conversation about what the budget should look like into the future, what are the appropriate revenues and expenditures and investments that should be made to protect and benefit the health, the safety, and the economic wellbeing of the American people, And we continue to insist that that should be the appropriate process moving forward. The good news at the moment is that President has clearly indicated default is off the table.
Senate Democrats, Mitch McConnell and Senate Republicans have said it clearly, the fault is off the table. House Democrats have of course made that position clear. And so that's four out of the five people who are sitting down to have a discussion about resolving this issue. We now need the extreme MAGA Republicans to recognize that they will be unable to use the possibility of a default in this hostage taking situation to extract the type of extreme cuts that
they know they otherwise can't achieve. And once they understand that it is not happening, we can find a way forward to get through this default crisis.
McCarthy has such a tiny, tiny sliver of the House that he rules by a four or five vote majority. I'm curious. It seems like a sort of more deft leader might be better able to control the party. It feels like they are controlling him.
I mean, that is the challenge. He's got a super small majority with an exploding number of extremists, right wing members of his conference who are intent on holding House Republicans, the House of Representatives, the Congress, the President, and the American people hostage. McCarthy is going to have to find a way to partner with us in the effort to achieve common ground and do the right thing by the American people. And that will be a point that we
continue to make because the fault would be catastrophic. It will result in a job chilling recession that will cost us millions of good paying jobs all across the country in blue states, in Purple states and in red states. It will crash the stock market in a way where millions of retirees are going to confront retirement and security issues that will be devastating for people who are entering into their golden years. That is going to impact people
in blue states, Purple states, and red states. This is not a Democratic issue or Republican issue. It's an American problem, and so I think we're going to have to continue to make that clear to the American people, and that public sentiment ultimately will help get this issue resolved in a constructive fashion.
I just was doing an interview with someone who is on the finance side, and he would say, you know, works with markets, and he was saying, the Democrats have not done enough messaging on just how insane it is to default on the DAD.
I think when we will need to continue to make that point. The American people, I think are just now tuning in to the realities of what could potentially happen and why we are in this situation, which is that the extreme magna Republicans passed the default on the America Act, which wasn't a budget. Joe Biden put a budget into the public domain in March, he asked Republicans to produce their budget so we could compare and contrast our priorities
with the American people. President Biden's budget will strengthen and protect social security, continue to work to build an economy from the middle out and the ground up. And it also reduces the deficit by three trillion dollars over the ten year budget window. And instead of the extreme magna Republicans producing a budget, they produced a ransom note that would effectively dramatically cut medicaid, particularly for children with disabilities
and older Americans. It would cut food and nutritional assistance to people who are food insecure millions of people across the country, cut education, cut public safety funding, cut veterans benefits, cut housing, cut health care. And we have to raise the stakes of awareness for the American people in terms of the two choices that Republicans have given us here in Washington, because both are inherently unreasonable. The Default on America Act is unreasonable and default would be unreasonable.
And it basically cuts all quote unquote discretionary spending, which is like food for poor kids, by about twenty percent.
Right, that's correct. What they've said is we want a twenty two percent across the board cut and that's veterans and everything that's right, veterans, medicaid, food and nutritional assistance for children. Snap, it would cut things like meal on wheels. Who does this? What kind of people you know would undermine the health, the safety, and the economic well being a vulnerable American in such a way unless cruelty at the end of the day is.
The point, yes, which we know it is. I want to ask you, Biden gave a really good presser the day that the Egene Carrol verdict came out about this default, and I don't know if you saw it. There was a journalist who was press who would say, well, you know what about their budget? And he said, well, what's in their budget? And she couldn't answer it.
It's correct because they haven't produced a budget. They produced a Default on America Act was basically said, top line, we just want to slash and burn everything twenty two percent across the board in ways that they cannot justify publicly. And so you know, we'll have our continuing discussions with the other side of the aisle. And I think the closer we get to June first and we do have to resolve this issue, and I believe June first is
a real date. The more the American people will pay attention to what is actually happening in Washington and what is being demanded by the extreme maga Republicans, and as that awareness increases in terms of the dramatic, draconian, devastating nature of the cuts that Republicans are proposing in exchange for avoiding a default and doing their constitutional responsibility to protect the full faith and credit of the United States
of America. And the American people understand that that is the prisoner's dilemma, that is the hostage taking situation, I believe they will swiftly and decisively reject the Republican position.
McCarthy has a pretty interesting leadership and he has a bunch of members of Congress. I would like to talk to you about George Santos, the gift that keeps giving for Democrats. He's out on bail. He has maybe settled the criminal dryes in Brazil. If the situation were reversed and you had a Democrat who was behaving this flagrant lay, would you kick them out?
I think Democrats have a long track record of accountability and making sure that members are held to a baseline standard of decent behavior that should be applicable whether you're a Democrat or a Republican in the House of Representatives. George Santos is a serial fraudster. He was elected under false pretenses. His whole length story was a lie as presented to the people of the third Congressional District in
New York State. And the Republicans have refused to deal with the Santos issue in part, perhaps because his very presence is necessary for them to be able to govern in an extreme way. In fact, it was George Santos who provided the deciding vote for the Default on America to carry in the House of Representatives. He literally is necessary for them to govern, and that probably explains why they're not acting right now.
I want to ask you. You have a situation here where you have a bunch of Republicans who have won in Biden districts, right. I mean, certainly that's true with Santos, but that's true with other less extreme perhaps Republicans. Though if they vote for the extreme policies, how much less extreme are they? I want to ask you, do you see a world where any of those people have a kind of come to Jesus moment and say like, we're gonna caucus with Democrats, because at least that could prevent a default.
I think that will be an important moment in determining whether these you know, so called more traditional Republicans who often go on TV and talk like moderates, yeah, or go back home in their districts throughout New York, California and talk like moderates, but then consistently come to Washington,
DC and vote with the extremists. And that's a level of hypocrisy that has gone on for a long period of time amongst the so called traditional Republican members of the House, eighteen of whom, as you pointed out, Molly, are now in districts that President Biden won in twenty twenty.
And one would think that for reasons of self preservation, even going beyond just doing the right thing for the American people, that for reasons of self preservation, they would understand they cannot allow us to default and detonate the economy,
which will hurt everyday Americans all across the country. And we are certainly involved in a significant effort to make sure that those Republicans are publicly held accountable for the position that they've taken up until this moment, which is to support the default on the mat as opposed to supporting avoiding of default paying our bills in the manner consistent that has been done on the Democratic presidents and Republican president including three times under the Trump administration, three
times by Democrats without showmanship, gamesmanship, or partisanship.
One of the ethics anxieties and one of the few sort of bipartisan moments we saw a little bit in this House is this case against members trading stocks. I mean, do you support that legislation and do you see a world where it could get passed?
That's I absolutely support the legislation, the effort, it is bipartisan in nature. I think I've had conversations with Speaker McCarthy about finding a pathway to make sure that this legislation is brought to the floor. It's the right thing to do in terms of marching toward a fuller restoration of public confidence that legislators and policy makers are making decisions solely based on the merits of the facts and the issues that are in front of the Congress, as
opposed to perhaps having other financial opportuniary interests. At the same time, I also think it is perhaps even more important that the Supreme Court be held to account and actually have some type of ethics code that currently doesn't exist, unlike the Congress, unlike the executive branch, where we do have codes of conduct and statutes that apply to our behavior, and we can enhance that consistent with what you've asked about, Molly,
in terms of prohibiting individual stock trades, that's the right thing to do, But the Supreme Court is a runaway trade right now. It's extreme, it's reckless, as out of control, and at a certain point, you know, the American people will say, are you willfully engaging in supporting the efforts of a justice like Clarence Thomas to conduct himself above the law?
Yeah, I want to ask you about that, because it does seem out of control, and they're quite emboldened. They've become a sort of huge legislative change agent in a way they were never intended to be. I feel like there's not appetite for a bipartisan but there might be some way to get the numbers. Do you agree? And can you talk about that?
At least in the Senate? What we have seen is some interest in seeking clarity by Senate Republicans even on the current Supreme Court posture as it relates to a code of conduct and its potential applicability moving forward. Democrats, of course, have been far more aggressive, and we should be in that regard, but given the divided government that is in front of us right now, in order to
achieve something it would have to be bipartisan in nature. However, I don't believe that we should do something cosmetic just for the sake of claiming that bipartisan action has been taken. If we do something relative to the Supreme Court, it should be meaningful, because, as you've pointed out, Molly, this is a Supreme Court that has engaged in huge overreach
undermining democracy and the freedom and justice. Of course, in the context of reproductive freedom, we believe in a woman's freedom to make our own reproductive healthcare decisions that should be the law of the land, and they've undermined that and imposed their own radical right wing ideology on the
American people. And so at a certain point, their credibility as an entity, as a separate and coequal branch of government is going to be eroded to the point where their decisions are not going to have the way that a Supreme Court decision otherwise should have. And that's part of the case that we continue to make publicly to the Supreme Court and to a Chief Justice Roberts, that you need to take some action to protect the legitimacy and the credibility of the independent judiciary.
There's been a lot made of this idea that you don't get along as well with the life flank of the Democratic Party. I mean, is there anything to that, and can you just walk us through that a little bit.
Now, I've been proud throughout the duration of my time in Congress up until this point to be a member of the Congressional Progressive Caucus. I joined the CPC the moment that I arrived in Congress. Have historically had one of the more progressive voting records in the House of Representatives and in the Democratic Caucus, you know, during my
previous five terms. But of course I have expressed support for members of the House who I believe are doing a good job, who from time to time have based primary challenges from the left, and I just haven't been bashful in that regard. Now, I did believe that as chair the House Democratic Caucus. Part of my responsibility was to be there for everyone, and I respect everyone tremendously, you know, from Representative Occasio Cortes to Representative johns Gottheimer
in all points in between. I do believe that we have to continue to govern in the way that is center left, that is enlightened, that is progressive, that makes changes that advance the cause of social justice, economic justice, and racial justice in America. That's been the journey that
I've been on. But we are a big tent, and that means progressive, that means New Dems, that means Blue Dogs, and of course you know the Congression on Black Caucus, Hispanic Caucus, Asian and Pacific Island of Caucus, Equality Caucus, Women's Caucus. That's who we are as House Democrats, where everyone we do reflect the gorgeous mosaic the American people, and I think we should embrace that and always try to find the highest common denominator in order to make progress for everyday Americans.
Last question, what keeps you up at night?
Although that ceiling showdown is what keeps me up at night, largely because you know, this is the one area where Republicans or at least a handful of them have to do something affirmative for the right thing to happen. In every other instance, House Democrats gay to stop bad things from happening legislatively in the House or slow it down if something leaves the House. Largely it'll be done on arrival and the Senate and Senate Democrats can kill it.
If for some reason something gets out of the House and the Senate President Biden using his veto pen can stop bad things from happening. This debt ceiling situation is the one area where either the House Republican leadership or a handful of more traditional House Republicans have to do the right thing to stop a devastating default from recurring.
And that's why it's so critical that we remain unified, strong together principle, get through this moment and then march toward twenty twenty four when brighter days are ahead.
Thank you so much, Congressman, Thank.
You so much.
Molly really appreciates you.
In again.
Congratulations on one hundreds episode.
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at shop dot fastpoliticspod dot com. Thanks for your support. Dan Nathan is a Squawkbox contributor and the host of Okay Computer. Welcome to Fast Politics, Dan Nathan Molly.
It's great to be back on your one hundredth episode.
Yes, it's very exciting. We had to have you back on our one hundredth episode because it's one hundred and that is a lot. Though. I think we've actually done like ten million episodes Jesse and I because we've been doing this forever. But every day is a new adventure, or at least every Monday, Wednesday and Friday. So let's talk about this economy. I'm confused. Just give us like the top line here.
Yeah, so through the lens that I look at it the way we pod about it on the Tapeway, I talk about it on CBC's Fast Money. I mean I look at it through the lens of the stock market. I'm not an economist, right, and so I think about what's happened over the last year, and you and I
have been talking a bit about this. I mean, we had these kind of push and pull of this rising inflation that we had, you know, after all of this stimulus, both monetary and fiscal, during the pandemic to keep our economy afloat, and then all of a sudden, at some point in twenty twenty one, the powers that be decided that all of that stimulus and the inflation that it caused has the potential to really do damage to the economy, right, and so the Federal Reserve started raising interest rates very
aggressively in March of twenty twenty two. And so what we had was the stock market reacting to that after we had this gangbuster's economy because.
Of all the stimulus. And so here we are right now.
You know, we're on the precipice of this debt ceiling debate. I know that you've been covering this a bit or we're actually having the debate right now whether we trip the.
Debt ceiling or not.
This has tremendous economic implications, right, so through the lens of the stock market, it's not bothered at all. The stock market has just flatlined over the last month and a half as we've had a lot of rhetoric back and forth between the White House and the Republican.
Because it's worried we should be worried about it.
And we have a recent example back in twenty eleven where the Ratings Agency cut the US debt okay, and so in the fear that we would default. And so one of the reasons why we fear this default it has the potential to of just push our economy into a recession if the US government can't pay its bills and the cost of capital goes higher.
The people.
There's plenty of individuals who work for the government who won't get paid. There's companies that will hold back on spending right and hiring, and you know Capex and all the like. So there's huge implications for the economy. But I guess through the lens that I look at it, it's really weird right now because the stock market doesn't seem to care.
So that is really weird. So let's just talk about those unemployment numbers. Because the unemployment numbers have been impressive. They've sort of gone and changed the numbers after they happened. Can you explain that phenomenon to us?
Yes, So we have these revisions, right. So, when you think about the way that the government agencies, you know, tabulate a lot of this data, there's lots of fits and starts with it, right, and there's there's definitely some smoothing out that needs to be done when the data comes in after the fact, right, So they do these revisions. So here we are, we have an unemployment rate at three point four percent. That is a seventy year low.
You know, when we were heading into the pandemic, and obviously no one saw that coming, we had unemployment at three and a half percent. Right now we're at three point four percent. And we saw this massive hiring binge right from all of these huge tech platform companies in the back half of twenty twenty into twenty twenty one.
So even though they're starting to shed a lot of those jobs, you know, because of a whole host of different weird things as it relates to you know, immigration and such, they're still demand for lots of jobs right here. So when you think about inflation, you know, a lot of us have been focused on the price of eggs or the price of gasoline at the pump, but wage inflation is a huge and sticky part of the equation here.
So the fact that we have unemployment at these levels is one of the reasons why the Federal Reserve just raised interest rates again at their meeting just a couple weeks.
Ago, but by lass, right, which sort of shows that they may be slowing down right.
They're getting close to an end.
I think if you look at Fed fund futures, and that's just this mechanism that prices how much the Fed is going to raise or lower interest rates. They're basically suggesting at this June meeting that they're not going to raise But the biggest point mollly in since March of twenty twenty two, the Federal Reserve has raised interest rates five percent. And that doesn't maybe five percent doesn't sound
like a big number in historical terms. It's the space in which they have ever done that amount of raises. And then the issue is what is the lag on the economy, because usually I think there's lots of economists will say that the lag is like nine to twelve months where really starting to affect the economy, and that's what we're starting to see in a bunch of the economic data that most economists, strategists, and investors track right now.
So the sweet spot is to crush inflation but not get into a recession correct.
And again, so what does that mean? We had inflation readings above nine percent, you know, in twenty twenty one they've come down to just below five percent. So the Fed feels pretty decent, The White House feels pretty decent that the job that they set out to do they are doing. But we don't know what the lag effect is on the economy. And you keep hearing about the
fear of recession. Sometimes the fear of recession, whether it be by households or businesses, is actually enough to pull back on spending, and then it becomes this kind of self fulfilling prophecy.
But also, you don't know if you're in recession until you're already in it.
Yeah, so the recession really means to con sect quarters of negative growth right now. And you know, if we look at some of the readings for Q one, we were barely up. Q two doesn't feel particularly great. You won't really know until after the fact. And that's why you know, CNBC and on our pods, we track this data week to week, month to month because we feel like maybe it gives us an edge, to give us a sense of whether or not we're going to be
in recession. But again, going back to the stock market, which a lot of your listeners are really focused on, that's kind of how they view the economy. You know, the stock market is hanging in there. The S and P five hundred, which is the major gauge of the stock market, is up seven and a half percent. The nasdac's up, you know, eighteen percent. People feel better about their four to one ks because last year was just
really bad. The SMP was down twenty percent. So sometimes, you know, the stock market has this way of just basically I don't know, tricking. I guess individuals who are most focused on it without really looking at what's going on under the hood.
Of the economy, right I mean, but ultimately, you know, it doesn't matter if the stock bump isn't real if you can still make money on it, right, I mean, just to speak in a completely vulgar term, I mean, the fundamentals of the economy won't necessarily get to the stock market in time to affect your trad you know what I'm saying, Like, well.
Here's the thing, Molly, they are getting to the stock market. So right now, I would tell you that the S and P five hundred and then Nasdaq are.
A total illusion.
If you look at the small caps, there's the Rustle two thousand, It's made up of two thousand small cap stocks.
It is down on the year. And let me just tell you something.
Apple, Okay, Apple Computer, which everybody owns in their four to one k because it's in almost every ETF and every mutual fund you know, is up already three percent of the year. It has a market cap of two and a half trillion dollars. It is greater than that of the Russell two thousand, which I said is down.
So if you think about the effects of what.
Just went on where this regional banking crisis in March where we had five banks go under, two of the largest regional banks out there, the cost of credit, the access to credit is much harder, it's much more expensive. That is first felt on small businesses in America, and small businesses make up I think over fifty percent of the hiring in America. So right now, we have, like I said, this illusion in the stock market where there's five or six major stocks and you know what they are.
They're Apple, They're Amazon, They're Google. They're all riding this wave of AI, artificial intelligence. There's all this excitement around this. I'm sure this is something that our main man, Matt Greenfeld, is talking about at the dinner table almost every night. But it's consuming the private tech world and the public tech world. And that is why, in my opinion, the major stock market averages are up because.
Because of these big tech stocks.
Yes, exactly.
Yeah, So let me ask you about this the regional banking crisis, because it's not as dramatic as it started out being with Silicon Valley Bank, but it seems like it's continued on. Talk to me about that.
Yeah.
So, so Silicon Valley Bank and First Republic Bank, these were two very recognizable banks.
In the regional banks.
Yeah, but they were considered regional and you know, these are two of the largest bank failures since Bear Stearns went under in March of two thousand and eight. And obviously we had many other banks fail in two thousand and eight and two thousand and nine, so a lot of us who tracked the markets or have been in the markets. You know, we have a little PTSD from the Great Financial Crisis, of the global financial crisis, whatever you want to call it, going.
Back, you know, fifteen years or so.
And so when you see banks fail like this, it doesn't give confidence right to the sort of businesses or individuals who rely on banks, right, So we had to run on the bank deposits, and until the government took extraordinary measures to backstop those deposits, this would have kept on going. And so the fact of the matter is, since we had Silicon Valley Bank go under in mid March, we had First Republic. There's a handful of other banks
that seem to be sort of teetering here. And so I kind of feel like we're in the second or third inning of this. I think that there's going to be different phases. But you could have said the same thing in two thousand and eight, once JP Morgan was
forced to buy bear Stearns, that things were over. The stock market rallied significantly in the two months after bear Stearns was sold basically for two dollars and then ultimately was ratchet up to ten dollars to JP Morgan it rallied fifteen percent, but then obviously ended up going down precipitously over the next year or so. So to me, you know, like history is not a great lesson that
we're one and done with these failures here. So to me, I think we really want to keep an eye on this and then really what does it mean for you know, local businesses, regional businesses that rely on the lending from these sorts of institutions because big banks like JP Morgan don't want to really deal with small banks. They just are not set up to do that, which is one of the reasons why they did not swoop in and by Silicon Valley back.
But these are all regulatory failures, right, I mean, these regional banks are not regulated in the same way that the larger banks are, so they've had loopholes and they've been able to invest their balance sheet in more risky stuff, stuff like crypto, and they've gotten you know, margin calls. I mean, I'm not saying this is all related to crypto.
There was one bank that had a lot of exposure to crypto. They weren't even investing in risky assets, Molly. They were invested in treasuries and the sorts of bonds that should be money good, right when the way we say in our business, the problem is is that some of these banks made very bad decisions. Okay, so they basically were investing in long duration securities that we're having marked to market losses, and they were not believing the FED that they were going to be as aggressive in
their rate hikes. Right, so when the rates go up, the price of the bond goes down, and they own the bonds, and then when there was a run on their assets, they actually had to match up right those and the liabilities, and they suffered big losses. And if you have money at a bank, whether you're an individual, whether you're a business, and you fear that that bank is going to go under, you're going to take it out. And they had to run on the bank and they
suffered big losses. And therefore these banks were pretty much deemed to be insolvent, which is one of the reasons why the FDIIC, the Treasury, and the White House had to take these extraordinary measures to make sure that they didn't fail and there wasn't going to be systemic ricks to the larger banking system because that would have most certainly put the economy in a recession.
We know the Republicans in the House would like to see this economy go into recession in the hopes that they could win in twenty four Right, you could see that as attention here, we're about to hit this dead ceiling. This worked well for them in the previous negotiations, like they were able to really hurt Obama. I mean, do you think that's the plan here?
Well, I don't think all Republicans would like to see the economy tank, right. I think they're the small you know, you know, the burn it all down faction that really has McCarthy's balls and advice right now.
Right, And by the way, those people McCarthy needs in order to get the numbers.
Yeah, you're right, there's a one no confidence voter is he's out of the speakership. So I think he's in a really tight spot. I think is a very different situation than we had in twenty eleven.
But I think at the end of the day, you know, even.
If Biden has to come up with some concessions on spending, and you know, I think they're going to do it. You know, there's an argument to be made that the Biden administration, it might be the best thing for them to actually have a recession now and come out of it in a couple of quarters and have a whole heck of a lot of strength heading into the election
year is twenty twenty four. The last thing that I would want to do if I was a policy advisor is have this thing kind of dribble into twenty twenty four, the election year, and then it's front and the center. And the other thing I'll just say is that the Biden administration, in my opinion, and I am a supporter, and I think they've done on a lot of things a very good job. I think they've done a very
poor job on messaging on the economy. We just talked about unemployment at seventy year lows at a time where you know, this administration has enacted fiscal stimulus to keep the economy afloat, to push into some initiatives that they think are very important as it relates to climate change, which, by the way, the IRA is going to massively benefit many red states. That's where a lot of this funding
is going. And I think they need to start dictating the terms on the economy that they want to speak about rather than letting the Republicans do that. They have done that, and you know, they need to have better ambassadors for the economy out there talking about what they're doing and why their initiatives are important and really kind of set the tone.
I don't think they've.
Done a good job setting the tone with this debt ceiling negotiation, because again they just said, we're not going to negotiate with terrorists.
By the end of the day.
There needs to be some you know, I guess messaging that makes the American people feel like if there is that low probability outcome that we do trip the debt ceiling and we do default and the economy does take a dive, that is not on the shoulders.
Of the president alone.
And let's say the current administration will be blamed, but they need to share the blame and they need to better set the stage for that if that is going to happen.
They need to explain to their constituents why these people are terrorists, right, I mean the fundamental explanation of the debt ceiling. This is money that was already decided to be spent, and that you know, there's no place for negotiating now, because it's like negotiating a ten thousand dollars bill with Amex right like you did it. It's not the moment to be like, how about I pay you seven thousand and then we just call it a day. You know, you can't do that unless you're in bankruptcy.
And I think that is really the thing that the Biden administration has not explained. But I do want to continue on this road. It does seem to me, I mean, from what we've read in reporting that the Biden administration is much more tapped into Congress than the Obama administration was.
Maybe I don't know.
I mean like I feel like Biden because he's going to likely face a candidate again, you know, Donald Trump, that it seems like Donald Trump, you know, he'd just run over right, all of these kind of anti Trump you know folks from twenty twenty and you know, post a twenty sixteen election, and it really feels like once
again it is firmly his party. And so I think that at that CNN town hall meeting, my partner Guya Dommi mentioned this on our pod on Friday, is like by Trump going out there and saying basically giving a permission structure for many Republicans in Congress to allow.
For this debt ceiling, you know, to to basically.
You know that that changed the dynamic here, and it really changed the dynamic I think for the Biden administration. So to me, I think that while the market right now is not pricing a great likelihood of default, I think that that is going to be something that if this meeting, you know, by the time folks are listening to this, you know, McCarthy will have already met with Biden again, I would not expect any substantive progress whatsoever.
This thing's going to go down to the wire, and the Treasury Secretary Yellen keeps reiterating this date of June first here, and so all of a sudden, we're going to see probably some fireworks in the stock market. And to me, that's the sort of thing that might cause some people to kind of raise their antennas who have not been really focused on this, who think the outcome is going to be okay.
They might freak out and turn the stock market. I mean, I do I think it is. It's worth remembering that the twenty twenty four election is still many, many months away, though at least Jesse and I's heads are now firmly planted in November twenty four. But I do it is worth remembering that we literally just had the midterms.
Yeah, I mean and again, and it wasn't a great result obviously for Republicans.
So like I mean, to.
Me, I just think it goes back to like, if they really this is where the White House has to do a really good job. Okay, so what is it exactly that mccar arthy. What what spending do they want to cut? Where will it come from? Are they defunding the police? Are they cutting these energy initiative?
Right? And we know they are. I mean, anyone who's read I mean their Times had really good reporting on this that in fact, it's cutting non discretionary spending, which is, you know, food for veterans by large numbers. I mean shockingly large numbers.
I Mean.
The whole idea that you're going to come up with budget about money you've already spent is just very Republican.
But here's an idea.
Okay, so for a couple of years, and you have all these people in your pods. Okay, Katie Porter in her whiteboard, let's start whiteboarding it out. Let's start making the case to the American people. I mean, you know Dan Goldman surgically, you know the way he operated right on the impeachment. You know, Representative shift was amazing and all of these outcomes. Let's get these people out there, Let's get them on the Sunday shows, Let's start them
doing small short videos. Let's do national campaigns about this. Where are these spending cuts we can turn I think public opinion in the favor of not negotiating with these terrorists, because there's so many other scenarios. Once if you kind of start doing this with McCarthy here, where does it end?
You know what I mean?
Like that, That's the one point I would make. So I think the Dems have to do a much better job in the messaging here.
Yeah, really interesting, Thank you, Dan Nathan.
All Right, Molly, my pleasure. Congrats on one hundred.
No moment full Jesse Cannon, Molly jung Fast. I was watching some seaspence day and I saw the Karen of Congress. She's got to talk to the manager about something.
One of my favorite things about Marjorie Taylor Green is that she has won everything. You know, how they say when you have a hammer. Everything is a nail. Well, when you're Marjorie Taylor Green, everything is impeachment. And today she has decided she wants She has introduced articles of impeachment yet again, not for my Orcas, not for the Vice president or the president or the president, but instead for the very famous Matthew Graves. You wonder who Matthew
Graves is. While he was appointed to be US Attorney for the District of Columbia on July twenty six, twenty twenty one, and assumed office on November fifth, twenty twenty one, she's very mad at Graves. I'm going to just read from the press release because honestly, I find it hilarious. Graves is systematically criminalizing political dissent at the behest of
his handlers in the White House. So a lot of words, but by focusing so much effort on the persecution of political prisoners, I think she's talking about the January sixth riders, Graves has diminished the manpower needed to fight crime, not just in DC but all over the country. How that would work, I don't know. DOJ attorneys have been transferred to DC just to help Graves wage his war against
political opponents. And now, in a typical trumpy fashion, he calls out his wife, because God forbid anyone is not harassed with an interest of their lives his wife. And then she lifts her name and talks about her career and makes a lot of false statements. And for that, Marjorie Taylor Green, is our moment of fuckery. That's it for this episode of Fast Politics. Tune in every Monday, Wednesday, and Friday to hear the best minds in politics makes
sense of all this chaos. If you enjoyed what you've heard, please send it to a friend and keep the conversation going. And again, thanks for listening.