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- [00:00]
A
Okay, I have 30 seconds to explain Canva. That's impossible, but here's a glimpse. Canva can take your presentations to another level. With Canva Video, you can generate awesome videos with one prompt. Canva Docs lets you create stunning visual documents, reports, plans, whatever magic write can write in your voice using AI and Canva sheets make spreadsheets people will actually like. Canva lets you bring your big ideas to life as fast as you can think of them. Put imagination to work@canva.com.
- [00:34]
B
Bloomberg Audio Studios podcasts Radio News. You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube.
- [00:56]
A
Thank you for being with us here on the Tuesday edition of Balance of Power. Over the course of the next hour, we're going to speak with Republican Congressman Byro Donalds of Florida. He, like many, are on their way back to Washington for an anticipated vote tomorrow to reopen the government. And we'll have some things to ask Congressman Donalds when he joins us later this hour. Jared Bernstein is going to be talking with us as well. Tyler, this idea that not only do we have a lack of data, but also data that may not reflect the way Americans are feeling. This is something that Donald Trump talked about a lot last evening in his interview on Fox News. Not buying the idea. He said he doesn't believe the polls and he thinks it's a Democratic con job that people are not feeling the benefits of this economy.
- [01:38]
C
Right. And one of those polls was one of ours conducted by the Harris Poll for Bloomberg News, which found that a majority of Americans aren't happy with the state of the economy right now. But what's important from that survey is that that is up from 41% back in February when President Trump originally took office. Affordability, of course, Joe, is going to be top of mind as we head into the midterms.
- [01:58]
A
It was one week ago tonight when affordability featured prominently in elections. Of course, in New York, New Jersey, Virginia, California might have been a slightly matter, but that was a wake up call for some Republicans and that's why many Democrats were surprised to see the moderates flip in the Senate a couple of nights ago.
- [02:13]
C
Right, exactly. Because the government shutdown has really been overshadowing those national headlines as it continues to drag on and Americans feel the impacts. So for the latest on where we stand on how close we are to reopening the government, we Bring in Bloomberg's Wendy Benjamin Sen, a senior editor here in our Washington bureau for a look on where this is all heading. So, Wendy, just give us an update. Are we looking at the government potentially reopening by tomorrow evening?
- [02:42]
D
It could be, because remember when. But we're really close. I was just thinking, whether it was Wednesday night or Thursday morning, President Trump has to sign the bill once it passes the House. So whether he chooses to sign it on Wednesday night or do it Thursday in front of cameras to make a big deal about it, which I suspect would be his preference, then it could be Thursday. But we, the country is certainly on its way to reopening at this point. It'll be this week.
- [03:09]
A
Now, what do we think about the optics here? Does President Trump have a signing ceremony at a moment like this after the longest shutdown in history? Does he try to take credit for what happened here, or do we just do this quickly and get on with our business?
- [03:22]
E
I don't know.
- [03:23]
D
You know, I think he certainly could spin it, and this is what the liberal Democrats are so angry about, is that he could spin it as the Democrats caved in. You know, it's all nonsense. As you talked about, he's mentioned a Democratic con job about how voters are feeling about the economy. I would page Joe Biden to find, you know, on whether it's really a con job or not. When Americans say they're unhappy, they're often unhappy. But so, yeah, he could spin it as a total victory for himself. I also think that Democrats, you know, were able to do this because they had won. As you mentioned last Tuesday, there was a Democratic sweep in generally liberal places, but Virginia is certainly purple. And they had, they had, it had become clear that they had won. In terms of who was getting blamed for the shutdown, it is at least, I think, by about 10 points. Voters are blaming Republicans for the shutdown because they control the White House and both chambers of Congress. But so they've, they've gotten that. And then the American public could turn on them very quickly. If Thanksgiving travel is messed up, if people aren't getting their snap benefits, if this just keeps getting worse and worse, and, and people are going without a third paycheck, I think the collective electorate might turn on the Democrats. So they can also spin this as the strategic thing to do to get the country back up and running.
- [04:51]
C
Well, back up and running until at least January 30th. I'm curious if we can talk just a little more about what's actually in this package that we're voting on one, are we going to be set up for another fight come the end of January? And two, I'm wondering how the White House is feeling about an important provision that Democrats got which reverses those mass federal firings that we saw starting on October 1st and puts a block on them through at least January 30th. There's, it's perhaps a simple stopgap measure, but there's also a lot of other things included that we should keep in mind.
- [05:24]
D
Absolutely. There are all those things you mentioned. And you're right, blocking the mass filings firings was something Tim Kaine, the senator from Virginia really wanted in there and got that. And so that is that will be good for federal workers. But you're absolutely right, Tyler. We are back here again, Groundhog Day, you know, in mid January when everybody gets back from the holidays. And here we are facing that again. There's also other little weird things in there like some senators can now there's a provision that allows senators to sue over their phone records being seized in one of these investigations, which shouldn't really even be in a spending bill. But this is what they call the Christmas tree ornaments. So there's, there's a lot of little hidden gems throughout this bill.
- [06:09]
A
Hidden gems with Wendy Benjamin. So thank you, Wendy Bloomberg, senior editor in Washington, which helps us set up our conversation with Jared Bernstein. Having listened to the president last evening, he sat down with Laura Ingraham on Fox News who actually challenged the president on the idea that it is the greatest economy in history, as he puts it. More importantly, though, when it comes to costs, this is something that we've heard the president check reporters questions on frequently suggesting that it's a Democrat hoax, that costs are going up, that people are not feeling the benefits of the broader Trump economic agenda and more specifically the big beautiful bill. Listen to what he said last evening. Is this a voter perception issue of the economy or is there more that needs to be done by Republicans on Capitol Hill or, or done in terms.
- [06:56]
F
Of policy more than anything else, it's a con job by the Democrats. They're saying they just have to say, you know, they put out something, say today costs are up. They feed it to the anchors of abc, CBS and NBC and a lot of other and, you know, CNN and etc. Are you ready? Costs are way down. Gasoline is going to be hitting $2 pretty soon.
- [07:18]
A
Well, of course, we've been keeping a very close eye on gas prices and the national average remains quite a bit higher than $2. It's closer to and I'm still waiting to get the memo on the talking points here because this is a conversation we used to have with officials in the Biden administration frequently. You remember Jared Bernstein standing on the North Lawn talking with us about this and why Americans were not always feeling the lower prices the data were showing. And we thought, well, Wendy suggested we page the Biden administration. Well, here we go right now. Jared Bernstein, of course, was chair of the White House Council of Economic Advisers for four years under Joe Biden. He's now senior fellow for economic policy at the center for American Progress. Jared, it's great to have you back. And I wonder what you thought of that conversation listening last evening to the president speak about a very different world than what data are showing or anecdotal evidence are showing. And you start to get this push and pull here where it's very difficult to tell people how they feel. What did you make of the rhetoric last evening?
- [08:22]
G
Well, as your setup for our conversation underscored, I think the president is making just a foundational, fundamental error here by trying to tell people they're better off than they think, really, than they know they are. Now, he mentioned the gas price. It's not $2 a gallon. It's $3.08 a gallon this morning. And that's exactly the same price it was a year ago. It was actually $3.07. And so not much there. Now I think the thing that's going on here is that President Trump often is able to persuade his followers of his reality, even if isn't backed up by the facts. But I feel very firmly that that particular superpower of this president, who really is an effective communicator to his followers, simply doesn't work when it comes to affordability. We certainly saw that result at the polls with the affordability election a week ago today. And I'm sure that the kinds of comments he was making last night are going to do him more harm than good when it comes to that very issue.
- [09:30]
C
Well, affordability isn't about any one item, one issue. And President Trump was asked about one potential proposal last night in this interview. When it comes to a 50 year mortgage, we want to play you a little bit more sound because Fox News pressed him on it as he's getting some pushback from some of those in his own base.
- [09:49]
F
It's not even a big deal. I mean, you know, you go from 40 to 50 years and what it means is you pay, you pay something less from 30 that some people had a 40 and then now they have a 50, all it means is you pay less per month, you pay it over a longer period of time.
- [10:05]
C
The idea is light on details, but Jared, is this the direction of travel we're headed in when it comes to attempts to lower monthly payments? I'm wondering how you would jumpstart the housing market and the impacts that we could see from the economy if a proposal like this went into place.
- [10:24]
G
Let me give you some interesting information on that. Unpacking that important question, first of all, on this 50 year mortgage idea, it's being lambasted pretty broadly and I did a calculation this morning. I revved up the old spreadsheet just to see what happened. If you look over the course of a 30 year versus a 50 year mortgage, I think you have to kick up the mortgage rate a little bit because lenders will ask for a little bit more. For locking up 50 year loans, you're literally paying over $300,000 more in interest over the life of the loan. So yes, you might pay a little bit less on a monthly basis, but over the life alone you're hundreds of thousands of dollars more on interest. But there's a broader point here. I think that the Republican Party in general and President Trump specifically have really lost any policy chops when it comes to affordability policy. It's actually fairly gnarly stuff. You really have to roll up your sleeves and get into the. You can't have Director Poulte of the FHFA come in and say here's a great idea. And then 10 minutes later, as I believe you've reported, the President goes out and says new idea. Same thing with his stimmis, these $2,000 stimulus checks to offset the effects of the tariffs, which by the way, he claims don't have price effects. Same thing with their health Savings account, which is really just a tax shelter for wealthy people, not a health insurance program. So they really have a problem in that their muscle memory for affordability polic is quite unutilized. And I think there the Democrats have an advantage and again, I think you saw that in the election.
- [12:05]
A
Do you ever meet anyone or know anyone who had a 40 year mortgage? Jared? I heard the President saying that some people are paying 40. That would be, would that be a qualified mortgage? Are those available commercially?
- [12:20]
G
They were for a time and then they weren't. So you might find a few people who have them. But by far the most common mortgage is of course the 30 year FRM, the fixed rate mortgage. And by the way, it would take legislation to implement a 50 year mortgage. I don't think this is going anywhere. I think this is some stray voltage, the, you know, idea of the day. But my broader point is I do think they're failing here, and I think they'll continue to do so. By the way, I didn't answer the very good question of, well, what the heck would you do if you wanted to deal with the housing market? And here I'm going to give you a little bit of a lead, which is that very shortly, I think next week, the center for American Progress, where I'm a policy fellow, I might even be distinguished policy fellow, that just means you're old. Where I'm a policy fellow, we'll be releasing a housing, a document on housing policy wherein we have numerous ideas that have been, again, we rolled up our sleeves and got into the weeds, but we have ideas that should significantly reduce the cost of both home ownership and rentals. So that's a little bit of a tease for something coming out next week.
- [13:27]
A
Okay, looking forward to it.
- [13:29]
C
All right. Well, we want to ask you about another one of President Trump's proposed policies, including this potential $2,000 rebate check tied to tariff revenues. We know that rebate stimulus checks would have to be approved by Congress. I'm wondering how feasible you see this being and what that impact would be on the broader economy, if it even gets approved.
- [13:54]
G
I think it would be a heavy lift for Congress. Even Republicans, when they see the price tag, I think would balk. There were numerous analyses out yesterday showing that almost any way you cut it, this idea would absorb well over what the nation is collecting in tariff revenues right now, which is something in the 200 to 300 billion a year amount in terms of, you know, the revenue collections from the customs. Remember, contrary to a lot of what the president says, the folks who pay the tariffs are the importers, the American companies that are importing these materials, these goods. And that's why it shows up in our, in our national accounts and the stimulus checks to allegedly offset the costs from these tariffs. And there are real costs there. They are. Juicing inflation, particularly about imported goods would swamp the amount of revenue, even though that's substantial revenue. This is a very expensive promise, so I doubt it would occur. I also think you have to be concerned about the Federal Reserve. I mean, they're kind of on a knife's edge there in terms of balancing a weakening job market and higher prices. They're looking at a nascent stagflationary environment. I think you'd be fighting the Fed big time. If you tried to implement this policy.
- [15:11]
D
Policy.
- [15:12]
A
Just about a minute left here, Jared. We started by talking about this ADP report and as we see continued cooling in the job market without the benefit of monthly BLS data, I just wonder where your head is on this. The Fed is kind of flying blind until the government can start churning out monthly job reports again. But this was a trajectory already in place. Where's the job market going to be a couple of months from now? And are you worried about this continued contraction?
- [15:41]
G
I definitely am concerned about it and I wrote about it this morning on my substack about precisely this question. The title of my piece was Are Layoffs Accelerating? And I concluded based on a lot of private sector data, adp, but one bit of public sector data which is unemployment insurance claims. They're still coming in that a it does look like layoffs are accelerating, but the trend is quite mild. So maybe flashing yellow. Definitely not flashing yet red and that's a maybe on the yellow. I do think the unemployment rate is probably ticking up and I would guess by the end of the year it's a couple of so which is next month. Actually it's a couple of tenths higher than it is now.
- [16:25]
C
All right, Jared Bernstein, thanks so much for joining us here on Bloomberg.
- [16:29]
A
Stay with us on Balance of Power. We'll have much more coming up at after this.
- [16:36]
H
Support for the show comes from public.com you're thoughtful about where your money goes. You've got your core holdings, some recurring crypto buys, maybe even a few strategic option plays on the side. The point is you're engaged with your investments and Public gets that. That's why they built an investing platform for those who take it seriously. On Public. You can put together a multi asset portfolio for the long haul. Stocks, bonds, options, crypto, it's all there plus an industry leading 3.6% APY high yield cash account. Switch to the platform built for those who take investing seriously. Go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market paid for by Public Investing. All investing involves the risk of loss, including loss of principal. Brokerage services for U.S. listed registered securities options and bonds in a self directed account are offered by Public Investing Inc. Member FINRA and SIPCrypt. Crypto trading provided by Zerohash complete disclosures available@public.com disclosures.
- [17:35]
B
You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay 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 11:30.
- [17:54]
A
We do this every day. Live from Washington, Balance of power. It's great to have you. You on the radio side here. Satellite radio channel 121. If you've got a Sirius XM, we're always there. And of course on YouTube where you can even pause this thing and back it up. Although they do that now at Sirius xm. Right? We didn't have that when I worked there. Brand new age of media. So we're trying to get a sense of when the voting is going to take place tomorrow. We understand around 4pm that might be the case with the House getting back to town today. The rules committee is going to get to work because the Senate did its job. They passed this CR+minus minibus. I don't know if we have a nickname for it yet. It's going to go to the House tomorrow and it's expected to pass. Speaker Mike Johnson says he's got the votes. Then magically the president signs the bill, government reopens and we'll wait days, if not weeks for airports to get back to normal, for SNAP benefits to be restored, for federal workers to get back on the job and start getting paid again, never mind specifically air traffic controllers. That's a big issue here and it's going to take some time to unwind. All of that of course leads us to a big floor vote on Obamacare. That was the so called deal, right? John Thune's promising, he says he'll set aside floor time for a Democratic led bill to extend Obamacare subsidies. We don't know if it's going to be a year or permanent or whatever. They've got to figure that out and write it. Republicans pivoting from the debate around the Affordable Care act tax credits as we speak though to maybe coming up with their own plan. And Speaker Mike Johnson says I never promised anybody a vote. So that may not go anywhere. Enter Donald Trump on Laura Ingraham, Fox News last night sat down for an interview in which he talked about a lot of stuff. We went through the 50 year mortgage, talked about the shutdown itself, but also specifically health care. Remember concepts of a plan? The president's been working on these concepts and it involves sending you money. Here's what he told Laura Ingraham about this last night.
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F
What I want, and probably what you're alluding to is the fact that I want, instead of going to the insurance companies, I want the money to go into an account for people where the people buy their own health insurance. It's so good, the insurance will be better. It'll cost less. Everybody's going to be happy. They're going to feel like entrepreneurs are actually able to go out and negotiate their own health insurance and they can use it only for that reason. That's only for that purpose. And if we did that, that would be so exciting. Call it Trumpcare, call it whatever you.
- [20:20]
A
Want to call it, uh, oh, Trumpcare. Okay, to replace Obamacare. Well, maybe that's what will happen. But the president's talking about the entrepreneurial exercise of you or me negotiating with an insurance company. That is the idea of how this works, right? You get a whole bunch of people together, pay into a pot, and then have some leverage to negotiate with said insurance company. Now it's going to be every man for himself. I bet your producer James gets a better rate than I got. Let's see how the panel feels about it. Rick Davis and Jeanne Shan Zaino are back with us today with the idea of Trumpcare on the menu. Bloomberg Politics contributors. Jeannie is our Democratic analyst and democracy visiting fellow at Harvard Kennedy School's Ashe Center. Rick is our Republican strategist and partner at Stone Court Capitol. Jeannie the concepts of a plan are being fleshed out. And you remember Joe Biden used to talk about the dignity of having a job. He said it wasn't just about making a paycheck. It was being able to look yourself in the mirror, look at your family in the eyes and say, everything's going to be all right. Now we suggest the dignity of entrepreneurialism. Is this what America needs?
- [21:30]
I
Jeannie it's as if he didn't live through all of the fighting on Obamacare. And you know, Joe, it reminds me of in the early 20th century, conservatives pushed this idea of liberty to contract. We don't need minimum wage, minimum working hours. Let's let everybody be free to contract without remembering the imbalance in power between workers on the ground and managers and owners. And of course, that's the same idea here. We as individuals without a collectivity have no powers against the big insurance companies. Donald Trump thinks we all want to go out there and be entrepreneurs and spend our lives negotiating with insurance companies. I'm not sure what he's thinking, but I think my favorite quote in the last few days was when Kevin Hassett was on CBS asked about this over the weekend and he said, oh, there's not really a plan. The president is just brainstorming I don't know if this is like his riffing, but I can tell you it's not the thing you're supposed to do when you're President of the United States as it pertains to something as important as health care to be out in public brainstorming. But he's continuing.
- [22:37]
A
Well, I'll tell you what, Rick, the President again, he said it's so good, the insurance will be better, it'll cost less. Everybody's going to be happy. They're going to feel like entrepreneurs. Is there a chance that he's right?
- [22:51]
J
It's hard to parse through the, the, the dialogue with the President. You know, he's not precise with the words he uses. It sounds a little bit like Bill Cassidy's idea. The Republican Senator for Louisiana who's on the negotiating committee that dune just appointed. And he has this idea that you create accounts at corporations that you, if you're an employee who work for you, they put money in, in a pre tax, which technically then maybe means you pay less because you're not paying taxes on the money that then is going to purchase insurance and that, that you can purchase insurance through that account. Bill Cassidy is a really smart guy. He's a doctor. He knows the industry better than anyone. I would be deferential to him because he's looked at it from a point of view of, you know, ACA is fine with a lot of people, but it does raise the cost of, of, of medical care in the United States and we should all try and bring it down. But as you also point out, Joe, insurance companies like actuarial tables. They want millions and millions of people in a pool to then grade in a price for the insurance. They don't want to just negotiate with you and me. And so there's a lot of wood to chop here. But look, put his group together that includes Cassidy. Schumer's leading the negotiators on the side of the Democrats. Somewhere in there is a way to manage the, the ACA subsidy issue and any other things that the Republican caucus wants to try to put forth.
- [24:29]
A
Bill Cassidy's names were coming up pretty often, Jeannie, and I'm not sure what he would think about what the President said last evening. Does he have the model for a Republican plan?
- [24:42]
I
There are models out there, but none that has been a selling point. I mean, as we know, this has been the Achilles heel of the Republican Party for years. Any time the conversation turns to health care, it has been a political loser, bar none. I'm just surprised that we're talking about this more than Chuck Schumer in the last 48 hours. But putting that aside, I mean, just think about what the president is saying. Has anybody. I'm expecting he has anybody and recently tried to call their insurance company. Do we all want to be waiting on lines to negotiate with some kind of robotic voice? Press 1, press 3, go here, go there. I mean, what are they talking about? And until they can articulate a plan which both Kevin Hassett and Scott Besson has said does not exist or is just, you know, they're just brainstorming about now, they have to be very cautious about this. And who knows this, this. Well, the president's pollster, Tony Fabrizio in July, big memorandum which said this is the death knell of the Republicans going into the midterms. They will lose by double digits in the 20 plus contentious districts if they are talking about this issue. So, in fact, you know, Democrats have been doing them a favor by trying to get a resolution, extend the subsidies. I'm surprised they haven't done it just for a year until after the election. But since they're insisting on not, they are looking at a political loser. And my only guess is that Donald Trump doesn't care much because he's not on the ballot. And that's why people like Marjorie Taylor Greene do care an awful lot because they are looking at their district and they know this is a loser for Republicans going into 26.
- [26:21]
A
Well, Rick, we've got two different stories in the two different chambers as well. John Thune, as I mentioned, promised a vote. I believe that was part of the deal with Jeanne Shaheen here. The White House, I guess, was on board with this. Katie Britt started making phone calls and here we have an off ramp. But Mike Johnson is refusing to commit to an Obamacare vote on the House floor. What makes Democrats think this is going anywhere?
- [26:49]
J
Because they still have.
- [26:53]
F
Bullet in the.
- [26:54]
J
Chamber, if you want to call it that, with a vote on January, at the end of January to extend either the appropriations bills or another cr. I mean, this isn't over, right? We just extended government funding from 2025. We didn't, we didn't solve the problem, say for those three minibus appropriations that were passed in the Senate, those come off the table. So it's not as horrific as it was before, but we could be waking up on February 1st with first with another shutdown. And so there is leverage. And my guess is too, you know, the president's already signaled that he wants to have a conversation about health care. And I don't disagree with Tony Fabrizio, as Jeannie points out. I mean, like if I were looking at the results of Tuesday's elections and said, gee, we want to pivot to caulking health care because that affordability thing isn't working for us, it's like let's dig deeper and see whether or not we can really cover ourselves over with earth before the election day.
- [28:01]
A
Wow. All right. Well, okay. So that said, Jeannie, if there's no extension of Obamacare subsidies, if Democrats don't get the deal they want, do we set a new record shutdown starting the end of January?
- [28:14]
I
Oh boy, I certainly hope not. But I do think it's possible even Jeanne Shaheen was out saying that. Listen to Rick's point, we have this deadline. It's there. You know, we can be back at this all over again. You know, the reality is that you've got the president who even last night in that interview with Laura Ingraham reiterated that affordability is a con job. He's not going to talk about it, doesn't want to talk about it. And to Rick's point, he's going to talk about health care. None of that makes any political sense for Republicans. Again, Fabrizio July, I think the Memo was a 15 point loser for Republicans in these competitive districts for the House. And so, you know, it would be a gift for Republicans to make a deal with Democrats on health care. I think it's possible they can do that in the Senate. But then they hand that hot potato over to Mike Johnson. And to your point, he told Jake Tapper on cnn, he said repeatedly it's a non or there. And I don't know what happens because who needs it politically more than anyone are the Republicans in the House. But they are dead set against it. And let's not forget they're dead set against it without articulating a plan to move forward. So that's what they should be spending their time on. And they haven't in 15 years by my estimation articulated a plan to combat the Affordable Care act and one that can sell to voters. And they're going to pay the price at the elect at the ballot box if they keep this up.
- [29:48]
A
Well, I'll tell you, if you want to explore the split in the Democratic Party here between the moderates who voted yes in the Senate and progressives who are calling for their retirement as written in the Hill, appropriately, Thanksgiving dinner in the Shaheen household might be a little awkward. Enter Stephanie Shaheen, Democratic candidate for Congress in New Hampshire, same state where her mom is, is in the Senate, of course, says she cannot support this deal and in fact demonizes it. Improving health care has been the cause of my life, she writes. It's why I am running for Congress, so I cannot support this deal. When Speaker Johnson refuses to even allow a vote to extend health care tax credits, Stephanie Shaheen says too many people will see health care costs already too high skyrocket even further starting in January. Knowing that her mother is the one who helped to spearhead the deal here, the meet in the middle with the White House and with John Thune in the Senate, it's going to be interesting to see how these two get out there in public.
- [30:51]
H
Support for the show comes from public.com you're thoughtful about where your money goes. You've got your core holdings, some recurring crypto buys, maybe even a few strategic option plays on the side. The point is, you're engaged with your investments and Public gets that's why they built an investing platform for those who take it seriously. On Public you can put together a multi asset portfolio for the long haul. Stocks, bonds, options, crypto. It's all there plus an industry leading 3.6% APY high yield cash account. Switch to the platform built for those who take investing seriously. Go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market paid for by Public Investing. All investing involves the risk of loss, including loss of principal. Brokerage services for U.S. listed registered securities options and bonds and a self directed account are offered by Public Investing Inc. Member FINRA and SIPC. Crypto trading provided by ZeroHash. Complete disclosures available@public.com disclosures.
- [31:52]
B
You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android Auto with the Bloomberg business app. Listen on demand wherever you get your podcasts or watch us live on YouTube.
- [32:08]
A
We're all keeping our eyes on Capitol Hill today for good reason. The Senate passed the legislation last evening that would reopen the government. Once the House does the same, the President pulls out the Sharpie and we're back in business. Of course, knowing that it could take some time for airlines to get back together, for airports and air traffic control towers to be fully staff, SNAP benefits to be funded, and of course the hundreds of thousands of furloughed federal workers to get back to work and get a paycheck in the bank account. So Tyler, what we have here is a Rules Committee hearing. It's going to be an important one that's set to start a few hours from now and they'll start hashing out the rules that will bring the bill to the floor. And by 4pm we're told don't necessarily bet on that, but around 4pm we'll have a vote in the House that could actually end this shutdown.
- [32:56]
C
Right. If we've learned anything, things could change quickly. Yes, they could, of representatives. But this is what we're tracking as of now, how Speaker Mike Johnson can only afford to lose two Republican votes. But it appears that his hand has been bolstered by the fact that President Trump has thrown his weight behind this deal, saying that he wants to sign it into law. Now, we're going to talk to one of the members who is going to cast his vote when this comes up tomorrow, and that's Congressman Byron Donalds. He's a Republican representing Florida's 19th district. Congressman, thanks so much for joining us here on Bloomberg Television and radio. I think I probably know the answer, but just to get you on the record and to confirm, how are you going to vote when this package comes up tomorrow?
- [33:37]
E
I'm voting yes tomorrow. It's time for the government to be reopened. And this shutdown created by Chuck Schumer and the Democrats, to be blunt, we're still not even sure what they shut the government down for in the first place. But we're excited to get back to work and get this to the president's desk as quickly as possible.
- [33:57]
C
Congressman, I want to ask you about one of the provisions that we're seeing included, which is a rollback, a reversal of the mass federal firings that started on October 1, also puts a block on any future firings until January 30. Do you have any concern with this policy since we know it's something that this White House had been acting advocating for?
- [34:17]
E
No, we don't. There's been a lot of work in this regard the entire year. That's number one. Number two, everybody knows at this point that one of the ways we're going to be able to get our spending under control, which is a major concern for the bond markets and our credit rating agencies, is we're going to have to streamline the federal government across the board. Part of that has been giving workers an opportunity to leave the federal workforce. Some of them have been provided bonuses on their way out the door. And so I think this is going to continue. Well, you know, we have a temporary measure that we have to get through here, and we're going to do that and get the government reopened.
- [34:54]
A
Congressman, it's good to see you. And you said something in your first answer that was important. What was this all for? Because it seems to me that this could have been something that took place weeks ago. Knowing that Democrats were offered an up or down vote on extending Obamacare subsidies. Many told us here on the air that that was simply not good enough. And I know, I know a lot of them still feel that way who are going to vote no because they wanted an actual deal on paper. John Thune has promised that vote. Now, should Speaker Johnson do the same?
- [35:23]
E
No, I think that's something that John Thune in the Senate has to go through. Let's talk real quickly about these Obamacare subsidies that were part of one of the things that Democrats are talking about. Let's first be clear. Democrats are arguing for like, five different things over the last 40 days, and that's how you know that they're not. Negotiations weren't serious. This was much more about politics from the Democratic left and politics from Chuck Schumer trying to save his job as Senate minority leader. But to the specific issue about Obamacare subsidies. What the Democrats have been telling the American people consistently is that they need more subsidies to cover up the true cost of health care. And these subsidies are on top of the existing structure of substance subsidies built into the law of the Affordable Care Act. So, in short, more subsidies is not going to fix Obamacare. What it's going to do is mask the true cost and the true damage to families everywhere. I've talked to people where their premiums for a bronze plan are now $2,000 a month. That's rent. That's a mortgage. In some parts of the country, the deductibles 12 to $14,000. So if you're making $125,000 a year as a family, you don't have $2,000 a month in disposable income to pay premiums, let alone the $14,000 to pay the deductible before you even start accessing the health insurance policy. This is what's wrong with Obamacare. The Democrats want to cover it up using subsidies as opposed to fixing the problem that they created 15 years ago.
- [36:55]
C
So then what is the plan, Congressman? Are we talking about replacing? President Trump has said that, that he'd be willing to negotiate when it comes to this very issue. So what's feasible? What's going to get through your chamber that would get your vote?
- [37:08]
E
I think what's feasible are Some of the reforms that we tried to get through back in 2017, I will tell you, by the way, Democrats refuse to lift a finger and work with us to avoid the calamity that we see today. But that's centered around healthcare policies that are patient centered. It's about healthcare policies that do not have overburdensome requirements on all the things that are covered that really create a bureaucratic bloat. It makes the premiums more expensive. It's about making sure there's more catastrophic insurance policies in the marketplace. Maybe you have young workers, they don't need a full gold plated health care policy. What they need is catastrophic health care coverage and ability to go get regular visits and checkups. That's a key part of this. There is a study being done. It was one, I think Senator Ron Johnson released these findings actually. And it's demonstrated that employer provided coverage in most of the country has just marginally risen over inflation. But when you look at health insurance policies in the Obamacare exchanges, they are up 2, 3, 400 in some respects, 500% over inflation. That's crazy. We've created a two tier system in health care. So I would tell the American people this is not simply about subsidies for Obamacare. It is about providing real solutions that put patients first. So we have a health care system and a health care insurance marketplace that people can afford and be able to access health care readily in their communities.
- [38:37]
A
Well, I love that we're having this conversation, Congressman, and I wonder your thoughts on what the President said to Laura Ingraham last evening because he's been on Truth Social about this as well. Give the money direct directly to people and let them negotiate with health insurers is essentially what he said. The quote was. The insurance will be better, it'll cost less, they're going to feel like entrepreneurs. He said they'll actually be able to go out and negotiate their own health insurance. Would that still require a pool of patience though, Congressman, to create leverage or am I calling up UnitedHealthcare and trying to get my own rates at the same time that you are?
- [39:13]
E
Well, I think there's parts of what you're saying are true, some that will have to be worked on. I think the premise of the President laying out is the correct one. Look at any industry in our economy. The ones where people have direct purchasing power to go to companies and buy the product they're looking for, those prices are actually increasing lower than the rate of inflation. But when you bring in these other issues, these other areas, areas where the government is doing direct subsidies. That's where the prices are completely out of control. And so for me, the situation is clear. The situation is clear. You have to put people at the front of the line. They got to be able to make those purchasing decisions. If it's doing, if it's giving those dollars directly to the individual, that will work. Now, to your question around risk pools. This is essential in all insurance. We could look at setting up geographic risk pools as an idea so that people in that community or in that state can actually be dealing with the insurance companies. But the insurance companies actually have a defined risk pool. This is one of the reasons why large companies have cheaper insurance than when people are just going into the marketplace by themselves because they're using the risk profile of working for that company to set up the risk pool to where then the actuaries kind of decide how much is the, the cost to insure each person in that pool. There's ways to do this, but the Obamacare way has been a disaster. It is now proven, and the costs are out of control.
- [40:41]
C
We're talking about next steps here. And I also want to talk about the next steps for fully funding the government because the stopgap measure goes until January 30th. How are we going to avoid another shutdown? Are we going to be having this conversation again when we know that the Senate has been proposing some spending levels that are higher than many House Republicans want to see?
- [41:01]
E
Well, again, we're going to get back to the negotiating table in short order. I know Speaker Johnson has told the members that we can expect some very long days when we get back to Capitol Hill. And that's fine. That's our job. And we're more than happy to do that. I think it's important for my Senate colleagues, both Republicans and Democrats, to understand one very important thing. We are borrowing a lot of money. The bond market is looking at us to curtail spending. And this is the core position of House Republicans. We can still have a federal government that does its job, but we don't have to be so obscene in how we are spending other people's money. And I think that, you know, if we come back to the situation again in January, I think whether it's healthcare or spending, it's important for myself and my colleagues to communicate clearly to the American people of what's truly at stake. Everybody wants to talk about the economy, affordability. These are major issues for the American people. The core of our affordability problems is massive government overspending. It diminishes the purchasing power of the American dollar. It does not help American families be able to make ends meet in Washington. For once we got to do the right thing. Let's cut our spend spending, get that down and let's pass bills. So we're not doing this brinksmanship, which by the way, the Democrats are the ones who want to do it. People should know, the Democrats, half of them, most of them are mad about this deal to reopen the government. They want the government to continue to be shut down. That's not an appropriate way to get the business done for the American people.
- [42:32]
A
Well, we have talked to a number of Democratic lawmakers who were not happy with the eight who crossed the aisle on this because there wasn't a deal there that they were hoping for. Certainly. Congressman, I I want to mention to our viewers on Bloomberg TV, if you're watching this on YouTube right now, that the congressman does not have a new job. He's not working at Cantor. He's actually down in Miami right now at an important air energy infrastructure conference. And I've got to ask you because we typically get to this because of your committee assignments and your areas of interest. An important bipartisan bill came out of the Senate last night, evening the Ag Committee on a crypto market structure bill. And I'm wondering where this stands in the House. We've talked so much about the Clarity act and whether there's going to be some reconciliation between these two pieces of legislation or a different path.
- [43:19]
E
I think we're probably going to end up sitting down and getting coming to an agreement between the two chambers on this. The one thing that's very clear, I'm happy that my Senate colleagues are taking this seriously. AI, quantum computing, the future of energy for our country. These are critical components to our economic future. If we don't actually create the frameworks for this, we fall further behind to China, to Europe and some of our rivals on the world stage. This is actually important stuff that we can get done. I'm very happy that AI and quantum is not a partisan issue. You because it's really about the future of our economy. And so let's see what they have. We'll work together with them and try to get something done that's going to put the American people first and actually be in the best interest of our country.
- [44:09]
C
Could you give us any timeline that we should be watching out for, any chance that this is going to get done by the end of the year?
- [44:16]
E
Listen, I don't put any timelines on Washington. You've been around long enough. You know, you just is what you do is you go in there, you work hard, you try not to set artificial deadlines. I do believe that you have members of the Senate, members of the House, myself included, who want to see a regulatory framework in AI crypto and quantum. It is important we have to be able to get this job done because we have many other public policy issues that we have to address as well. One of them is energy. I'm a major proponent for small modular nuclear reactors to be commercially deployed throughout the United States. Every state needs to double their amount of power on their grid. The United States needs to do that. And this is something where my colleagues on Capitol Hill, this is common sense stuff that actually provides energy at a lower per kilowatt hour than any other generation source. We need to get in the game and get that done as well.
- [45:11]
A
Well, you know, Congressman, few stories are more important to our audience, so let's talk about that. Let's have that conversation when you're back in town with our eyes, of course, on the AI space. Congressman Byron Donalds, I hope you get the flight back to D.C. all right. That's easier said than done. Representing Florida's 19th district. 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, D.C. at noontime eastern@bloomberg.com.
- [45:43]
B
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