Balance of Power — Government Shutdown Enters Second Week

Bloomberg | October 6, 2025
Hosts: Joe Mathieu, Kailey Leinz
Notable Guests: Eric Watson (Bloomberg Congressional Reporter), Rep. Nicole Malliotakis (R-NY), Jeannie Shanzano (Harvard), Rick Davis (Republican Strategist), David Hale (Wilson Center)

Episode Overview

This episode covers the ongoing U.S. government shutdown as it enters its second week. Bloomberg correspondents and guests report from Washington, breaking down the deadlock in Congress, its effects on government operations and the economy, and the intense focus on issues like Obamacare subsidies. The episode also explores President Trump’s use of the National Guard in American cities, judicial resistance to those actions, and the state of Mideast peace negotiations as tensions persist in Gaza.

Key Discussion Points & Insights

1. Congressional Deadlock & Shutdown Extension

Segment: 01:03–06:35

• The government shut down over the weekend as expected, with Congress unable to reach agreement. House Speaker Mike Johnson announced a recess until the Senate takes action.
• Two competing bills are up for vote in the Senate: a Republican "clean" Continuing Resolution (CR) and a Democratic bill with elements Republicans deem toxic.
• Both sides claim the moral high ground; there is no clear plan to reopen the government.
• The White House signals it is preparing for possible mass firings of federal employees if today’s vote fails, although such layoffs require significant preparation and are likely meant to increase pressure.

Notable Quote:

"Everyone still thinks they have the moral high ground and there's no deal in sight. The House... is going to hang for another week before they come back." – Joe Matthew (01:24)

• Negotiations hinge on enticing a handful of Democrats to join Republicans in passing a stopgap bill, with offers to pass certain appropriations bills (agriculture, veterans affairs).
• Democrats remain focused on the need for a concrete plan regarding Obamacare subsidies; vague promises aren’t enough.

Notable Quote:

"Democrats are still saying, look, we have the larger issue of the Obamacare subsidies and that has to be addressed in some way, not just a vague promise to deal with it later..." – Eric Watson (03:45)

• Significant deadlines:
  • Oct 10: Federal workers risk missing a pay cycle.
  • Oct 15: Military pay is jeopardized.

Notable Quote:

"Economic terms, we start to see missed paychecks, ramifications of GDP start to pile up. The Trump shutdown in 2019 really ended when air traffic controllers said they're not going to work anymore without pay..." – Eric Watson (04:31)

2. Political Dynamics & ObamaCare Subsidies

• Talks of a potential rule change in the Senate to require only a simple majority for stopgap spending bills—raising concerns this could end the legislative filibuster, something Republicans are reluctant to do.
• There's speculation about a “jailbreak” — the defection of a handful of moderate Democrats to pass the CR.

3. Congressional Guest: Rep. Nicole Malliotakis (R-NY)

Segment: 08:05–16:39

Rep. Malliotakis characterizes the current Senate impasse as unnecessary, stating Senate Democrats had previously supported the same funding levels. She insists Democrats are holding up passage due to a change in political circumstances, namely President Trump now being in office and political threats from the left within their party.

Notable Quotes:

"It was absolutely unnecessary. All we needed were the seven Democrats to join the 53 Republicans to get the 60 votes necessary to pass this bill, just like they've done before." – Rep. Nicole Malliotakis (09:44)

"The only thing that has changed is President Trump is now the president. We know they don't like him and they want to... put pressure on President Trump." – Rep. Nicole Malliotakis (11:42)

• She cites real-world impact: military pay, women and children's nutrition programs, TSA delays, and taxpayer costs of $400M/day.
• She rejects using federal funds for healthcare for undocumented immigrants, indicating this is a red line for her support.
• On potential layoffs: She suggests it'd be a consequence of continued shutdown but could be avoided if Senate Democrats vote with Republicans.

Notable Quote:

"We will not accept by any means $200 billion going to states that make its way to fund illegal immigrant health care. We will just not accept that. That is not negotiable." – Rep. Nicole Malliotakis (12:51)

• She supports suspending congressional pay in solidarity with unpaid military personnel.

4. Courts Push Back Against National Guard Deployments

Segment: 18:22–30:28

• President Trump seeks to send National Guard troops to major U.S. cities like Portland and Chicago, citing unrest. Federal Judge Karen Immergut (a Trump appointee) has twice ruled against these deployments, finding no evidence justifying their use.
• The administration and key advisor Stephen Miller frame city protests as "domestic terrorism," "invasion," and "legal insurrection."
• Legal and constitutional experts warn about the slippery slope and the risk to states' rights if out-of-state troops are used to police cities.

Notable Quote:

"A federal judge can't just look at television. A federal judge has to look at the facts before them ... the facts don't support this nationalization of National Guard troops." – Jeannie Shanzano (21:30)

"Why would you need to... call [troops] up... to go fight with protesters in cities that they have nothing to do with?" – Rick Davis (22:18)

• Public backlash is growing, with concern that such moves stoke political violence rather than calm it.

Notable Quote:

"Treating Americans as sort of counterinsurgency strategies is really not going to meet the moment." – Rick Davis (29:05)

• Chicago’s Mayor Brandon Johnson says, "We are unequivocally going to continue to reject the military occupation of our city. The Trump administration must end the war on Chicago..." (28:44)

5. Middle East Update: Hostage Negotiations & Ceasefire Talks

Segment: 31:58–44:50

• David Hale discusses negotiations in Sharm El Sheikh regarding hostages held by Hamas, Israeli military actions, and diplomatic efforts to craft a post-ceasefire roadmap.
• Trump administration puts strong diplomatic pressure, as the Nobel Peace Prize announcement looms.
• Realities on the ground complicate progress: divisions within Hamas, Israeli coalition politics, and external pressures from Turkey and Qatar.
• The deal reportedly diminishes Hamas’s political future—further complicating negotiations.

Notable Quotes:

"Their only leverage left are these hostages. So they want concrete guarantees about the day after, which the Israeli government is unlikely to provide." – David Hale (35:19)

"This plan is not pie in the sky... It's about security provided by Arab states... But above all, it requires Hamas first and foremost to disarm." – David Hale (41:13)

• Trump administration prioritizes hostage releases—seen as a high priority by both the President and his advisors.
• Outside actors, like Jared Kushner, could be playing a behind-the-scenes role.

Notable Quote:

“His ability to apply leverage to get hostages out may clear the way then for what’s even more important… which is bringing this violence... to an end.” – David Hale (40:57)

Memorable Quotes by Timestamp

• On Congress’ Stalemate:
  "Everyone still thinks they have the moral high ground and there's no deal in sight." — Joe Matthew (01:24)

• On Impact:
  "This is costing the taxpayers $400 million a day. And it's unfortunate that we came to this point." — Rep. Nicole Malliotakis (09:28)

• On Immigration and Healthcare:
  “We will not accept by any means $200 billion going to states that make its way to fund illegal immigrant health care. We will just not accept that.” — Rep. Nicole Malliotakis (12:47)

• On Judicial Independence:
  “A federal judge can't just look at television. A federal judge has to look at the facts before them.” — Jeannie Shanzano (21:30)

• On Political Backlash:
  “Treating Americans as sort of counterinsurgency strategies is really not going to meet the moment.” — Rick Davis (29:05)

• On Middle East Diplomacy:
  "Their only leverage left are these hostages. So they want concrete guarantees about the day after, which the Israeli government is unlikely to provide." — David Hale (35:19)

Important Segments by Timestamp

• Congressional stalemate & risks of continued shutdown: 01:03–08:05
• Rep. Nicole Malliotakis on Senate gridlock: 08:05–16:39
• Legal battles over National Guard deployments: 18:22–30:28
• Middle East peace efforts & hostage negotiations: 31:58–44:50

Tone & Style

The hosts blend urgency, clarity, and some measured skepticism regarding both Congress' dysfunction and the administration’s actions, while guests provide in-depth, informed context. Elected officials and experts employ conviction and advocacy—often criticizing the motives of the opposite party and expanding on the real-life effects of governmental actions for the public.

Conclusion

The episode not only unpacks the intricacies and political gamesmanship behind the ongoing government shutdown but also places it within a larger context of executive action, judicial oversight, and international crises. It reveals the interconnectedness of domestic gridlock, the real-world consequences for everyday Americans, and the persistent volatility on the world stage.