Trump, Xi Strike Truce on Tariffs, Rare Earths

Summary

Balance of Power – Trump, Xi Strike Truce on Tariffs, Rare Earths

Host: Joe Mathieu (Bloomberg)
Guests/Contributors: Kailey Leinz, Tyler Kendall (Bloomberg), Mary Lovely (Peterson Institute), Lisa Camuso Miller (Republican strategist), Megan Hayes (Democratic strategist), Congressman Jake Auchincloss

Date: October 30, 2025

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Episode Overview

This episode examines the major developments from the recent summit between President Trump and Chinese President Xi Jinping, focusing on the newly-announced truce on tariffs and negotiations over rare earth minerals and agricultural trade. The show features expert analysis on the implications of the deal for U.S.–China relations, the underlying issues not addressed by the agreement, and the potential economic and political consequences. A second segment pivots to analysis of upcoming key U.S. elections and the ongoing government shutdown, before ending on the state of air traffic control under the shutdown and U.S. energy policy.

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Key Segments and Analysis

1. Trump–Xi Summit: Truce Details and Immediate Reactions

[00:50] – [06:55]

Main Points

• Length and Attendance: The summit in South Korea lasted ~1h 40min with top U.S. officials present, including the ambassador to China.
• Initial Outcome: President Trump hailed the meeting as “amazing” and rated it a “12 out of 10,” but specifics remain sparse.
• Tariffs: Immediate 10% cut to U.S. tariffs on China (now effectively 47%), with the threat of a 100% tariff withdrawn.
• Rare Earths and Trade: China grants access to rare earth minerals, resumes purchase of U.S. soybeans—12 million tons for 2025, 25 million annually through 2028.
• No Progress On: Blackwell chip sales to China (Nvidia), TikTok, and Taiwan (which “didn't come up”).
• Energy Prospects: Prospect of a major China–Alaska oil and gas deal being explored, but no agreement yet.

Quotes

• President Trump:

  “It was an outstanding group of decisions, I think that was made and we've come to conclusion on many very important points. Many important points.” – [01:28]

• Joe Mathieu:

  “We’re still trying to figure out exactly what was accomplished beyond the one year truce.” – [01:37]

Additional Context

• The rare earth provision and agricultural quotas are presented as the most concrete wins, but as Bloomberg’s Tyler Kendall notes:

  “At the end of the day, the root causes that led to the standoff between the US and China really haven't been resolved…” – Tyler Kendall [03:50]

2. Expert Reactions: Was This a Win for the U.S.?

[06:55] – [15:29]

Larry Summers’ Perspective

• Key Takeaway:

  “The most important thing is what didn’t happen. This situation didn’t spiral out of control...and that’s the good news.” – Larry Summers [07:17]

Mary Lovely's Assessment

• Critique:

  “A lot of this conflict was stirred up by President Trump in attempts to gain some leverage. China showed a very strong weapon...rare earths...and I think the US blinked.” – Mary Lovely [08:20]

• On U.S. Strategy:

  “The US is focused on short term deals. That asymmetry is not going to serve us well moving forward.” – [08:44]

• On the soybean purchase deal:

  “For China, this is just another chip that it can turn on and turn off.” – [10:34]

• On Taiwan being out of scope:

  “Right now we all benefit from as little attention to Taiwan as possible.” – [11:47]

• On tech/AI:

  “We're moving very, very quickly into the era where China is going to be very competitive in embodied intelligence...that use AI to bring those productivity improvements to fruition.” – [12:35]

• On the lack of detail for Blackwell chips (Nvidia):

  “I don't think we have much clarity on where these lines are going to be drawn.” – [14:00]

Key Summary Points

• The truce buys time but is largely a pullback from recent tariff escalations.
• Major structural issues—national security, tech decoupling, fentanyl, TikTok—remain unresolved.
• The U.S. may be ceding leverage to a more strategically patient China.

3. U.S. Domestic Politics: Election Previews

[17:51] – [28:38]

New York Mayoral Race

• Poll numbers for Mandani range from a 10–25% lead.
• Early voting is strong; key issues are street safety and economic stability.
• Notable endorsement: Michael Bloomberg and the United Bodegas of America for Mandani.
• Quote (Megan Hayes):

  “Anything—you only have to win by one vote. So I think that...he’ll be fine and it will probably be an early night.” – [20:32]

Republican/Democratic Strategist Analysis

• Lisa Camuso Miller:

  “If I'm Andrew Cuomo, I'm talking about stability and I'm talking about predictability because that's what people want to see…” – [22:07]

New Jersey & Virginia Gubernatorial Races

• Both are tight; Democrats are favored but affordability is a driving issue.
• If both Mikie Sherrill (NJ) and Abigail Spanberger (VA) win, it would be the first time two women simultaneously led the states as governor.
• Predictions: NJ race could be exceptionally close—possibly a recount.

4. Government Shutdown Effects – Air Travel and Social Safety Nets

[30:38] – [36:17]

FAA & Air Traffic Control

• Real World Impact:

  “We begin seeing ground stops at airports around the country because of the government shutdown. Remembering that air traffic controllers are not being paid.” – Joe Mathieu [30:55]

• Congressman Auchincloss:

  “The air traffic controls have been warning about this. They're working without being paid. Contrast that with Speaker Johnson, who's being paid without working.” – [32:34]

• Controllers may take other jobs, leading to staffing shortages and unsafe conditions.

SNAP and Social Programs

• Potential risk to food benefits for families with children as shutdown continues.
• Auchincloss:

  “Illegally withholding those SNAP funds is callous and cruel.” – [35:24]

• State governments (e.g., MA) are trying to fill gaps, but ultimately these are federal programs.

5. U.S.–China Relations, Strategy, and Energy Policy

[36:17] – [43:02]

Pentagon/Nuclear Tests

• President Trump called for renewed nuclear testing (“on an equal basis with Russia and China”).
• Auchincloss:

  “He’s trying to saber rattle to distract from the fact that he started a trade war with China and American farmers are now losing it…” – [37:09]

Tech & Energy Policy

• Debate over Nvidia chip exports: conflicting priorities between national security and technological leadership.
• Auchincloss:

  “Jensen Huang is talking his own book...The President should be looking in a long-term way about American competitiveness.” – [39:47]

• Calls for industrial policy focusing on American energy dominance, rare earths supply chain, and research investment.
• Next-gen geothermal cited as promising for energy independence and lowering costs.
• Critique of current administration for short-termism and “crony capitalism.”

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Notable Quotes & Memorable Moments

• Joe Mathieu (on the truce):

  “We're still trying to figure out exactly what was accomplished beyond the one year truce.” [01:37]

• Mary Lovely (on US strategy):

  “It’s a little bit sense of back to the future… The US blinked.” [08:16]

• Larry Summers:

  “The most important thing is what didn’t happen. This situation didn’t spiral out of control.” [07:17]

• Tyler Kendall:

  “At the end of the day, the root causes...really haven't been resolved...we are mainly pulling back on the escalation from really just the past few weeks alone.” [04:48]

• Congressman Auchincloss (on nuclear testing):

  “He's trying to saber rattle to distract from the fact that he started a trade war with China...” [37:09]

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Timestamps for Key Segments

• Trump–Xi Truce Details: [00:50] – [06:55]
• Expert Reactions – Summers & Lovely: [06:55] – [15:29]
• NY/NJ/VA Elections Analysis: [17:51] – [28:38]
• Government Shutdown Impacts (FAA, SNAP): [30:38] – [36:17]
• Pentagon, U.S.–China Tech, Energy: [36:17] – [43:02]

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Tone & Takeaways

The episode maintains a brisk, analytical tone, blending expert skepticism with a sense of the ongoing complexity of U.S.–China relations. There is clear frustration among analysts and policymakers about the lack of deep, strategic progress—most see the truce as a de-escalation, not a solution. The U.S. domestic political scene is portrayed as divided and reactive, with foundational issues like national security, social safety nets, and energy policy still unsettled as the government shutdown drags on.

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This summary should help you grasp the major themes, opinions, and consequences discussed in the episode.

Transcript

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[Joe Matthew]

It is the day after the meeting. President Trump is in the air and he's on his way back to Washington. He should be on the ground about two hours from now on this Thursday. It is the 30th of October, if you can imagine that. A rainy day here in the nation's capital as the President comes back home from South Korea and the Senate heads for the hills after another less than fruitful week in keeping the government open. We are now closed for 30 days with again no signs of this ending. So thanks for joining us here on the Thursday edition of Balance of Power here on Bloomberg TV and radio. The meeting lasted an hour and 40 minutes roughly between President Trump and President Xi. All of the president's lieutenants were there, Lutnick, Besant, Rubio, Greer, Wiles, even Perdue. Yes, the ambassador to China, David Perdue, was there. And within an hour of that meeting ending, the president was on Air Force One talking with reporters. This was the first readout that we got on what happened. Listen to Donald Trump. I thought it was an amazing meeting. He's a great leader, leader of a very powerful, very strong country. And we, what can I say we have. It was an outstanding group of decisions, I think that was made and we've come to conclusion on many very important points. Many important points. He called the meeting at 12 out of 10, but we're still trying to figure out exactly what was accomplished beyond the one year truce. The president is cutting tariffs on China by 10% immediately, 57 to 47% with a nod to China, his attempt to apparently interfere with the fentanyl trade, though we haven't seen details on that. The new threat of an additional 100% tariff is now off the table. In exchange for access to rare earth minerals, soybeans will be sold. This might be the most specific takeaway that we have 12 million tons of soy for this year 25 million a year going through 2028 according to Brooke Rollins, the ag Secretary. And the president is going to go to China in April is at least the plan for now. That remains a long way off. But we have huge questions about so many things from in video. Remember yesterday we were talking about selling black wells in Beijing, no agreement there. President says Taiwan did not come up and nothing was hammered out on TikTok. Generating the headline on the terminal Trump Xi truce buys time as both seek leverage in broader fight. Or as Terry Haines at Pangea Policy put it in his note to clients in you'll get a truce and you'll like it. Let's go to South Korea for more. Bloomberg's Tyler Kendall's been there all week for the negotiations with Seoul and now Beijing and joins us with a live update. Tyler, what else do we know?

[Tyler Kendall]

Hey Joe. Well, you really set this up perfectly. We are seeing this easing in tensions, but at the end of the day, the root causes that led to this standoff between the US And China really haven't been resolved, particularly around national security, the greater issue of unbalanced trade. And of course as both countries are jockeying for dominance when it comes to the tech sector. Now you laid out some of the deliverables that we did get this meeting. We should keep in mind that there's actually a broad array of tariffs on China imposed by the US some are from a Section 301 investigation into unfair trade practices. Others are Section 232 tariffs enacted and sector in specific. But then some are related to fentanyl. That 20% tariff related to fentanyl now being cut in half. But as you mentioned, we are going off of a pledge President Trump said that he got from Chinese President Xi Xi Jinping to curb what's known as those precursor chemicals that go into the drug. And then lastly there's that so called reciprocal tariff rate that's been on China. It had the threat to be ratcheted up. Now it is going to be extended at 10% for at least a year. So that's how we get that aggregate 47% effective US tariff rate currently in place. But then some of those other deliverables that we got really just feel like we are getting a pullback in recent escalation from just the past few weeks. Right. China now committing to soybeans, purchasing 12 million tons through the end of this year, 25 million tons for the next three years. Worth mentioning, that 25 million ton number is in line with what US farmers would be expecting to export during that time. So that is welcome news, of course, for American farmers. But those other provisions, threats from the US to impose fees on Chinese ships docked at American ports, for example, that has also come off the table. So Joe, I think that you framed it really well. This is an easing of tensions. It is welcome. But at the end of the day it feels like we are mainly pulling back on the escalation from really just the past few weeks alone.

[Joe Matthew]

Fascinating, Tyler. There was talk of a energy deal in Alaska that China would be buying oil and gas. The president says Chris Wright, Doug Burgum and our respective energy teams, according to his True Social post, will be meeting to see if such an energy deal can be worked out. So nothing is on paper yet, right?

[Tyler Kendall]

No, not yet. And the Energy Secretary, Chris Wright was on Bloomberg Television this morning, did confirm that he has a trip coming up. He said it actually might happen sooner than previously expected, but we did not get any more details here. Of course, as you well know, the administration has been pushing to streamline and deregulate when it comes to permitting and drilling in Alaska to get more American barrels overseas. So it's something we're going to be watching closely because President Trump up to this point hasn't taken punitive action against China when it comes to their imports of Russian energy supplies with say a so called secondary tariff like we've seen implemented against India. And China is the top importer of Russian energy crude. In fact, Russian barrels make up about 20% of China's import of crude in general. So, so a huge market for for them as this really has been a central component to helping the Kremlin fund the war in Ukraine.

[Joe Matthew]

Yeah, great stuff, Tyler. We're so lucky to have you there. Tyler Kendall, still in South Korea for the aftermath of the APEC summit and President Trump's meeting with President Xi. We'll have more from Tyler as we make our way through the day here. And the president makes his return to the US Clutch analysis from the former US Treasury Secretary Larry Summers. He talked to David Westin just a short time ago following the meeting. Here's what he said. I think the most important thing is what didn't happen. This situation didn't spiral out of control into massive confrontation and economic conflict. And it was managed in a way that avoided what potentially could have been very unfortunate and destabilizing outcomes. And that's the good news. And I think it genuinely is good news. Glass half full, let's see what Mary Lovely is pouring. Senior fellow at the Peterson Institute for International Economics we had to talk to Mary, knowing the importance of this meeting. And it's great to have you back with us, Mary, on Bloomberg TV and radio, we can say a lot about what was not accomplished or what didn't happen. Yes, we don't have an international crisis this morning, but we don't have a lot of details either. How are you reading this meeting?

[Mary Lovely]

Well, it's a little bit sense of back to the future. We, you know, a lot of this conflict was stirred up by President Trump in attempts to gain some leverage. China showed a very strong weapon in its rare earths exports. And I think the US Blink. So I think that, you know, the former Treasury Secretary Larry Summers is right. We don't have an escalation. But I think the reason that we don't have an escalation is because that the US Realized that it was not in a good position. I think we're seeing an asymmetric, you know, response to this, which is that China is doing everything it can to reduce its dependence on the United States. It has been for some time. And the US Is focused on short term deals. And I think that that asymmetry is not going to serve us well moving forward.

[Joe Matthew]

Wow. All right. Well, there's your headline for Mary. Lovely. The US Blinked. You said a couple of things there as well. Back to the Future is not the first time I've heard that line and I was trying one out earlier. Mary, is this not the proverbial putting on a really tight pair of shoes and celebrating how good it feels to take them off?

[Mary Lovely]

Yeah, I think that is apt. I think that we are happy that the shoes are off. There is no doubt about that. And you know, 100% tariffs on China simply would do nothing good, only bad things for the US Economy. That doesn't mean that China would be spared either. They would be. They are being hurt by this, but they're in a very different situation, different political system. I think the Chinese feel very good about where they are about the use of the rare earths. I think right now we've sort of seen the big weapons put back in the holsters. But as, as, as your correspondent has noted and others have noted, this is, you know, really by no means a settling of the really big issues that are out there. And those issues, I'd add a really changed since Trump won, since the issues that were dealt with in the original Section 301 report that was the basis for the trade war that started back in 2017. Today we're looking at difficult issues on really decoupling for national security purposes and doing that in a way that, that really minimizes the negative effect on the US Economy and on the economy of our alliances. So there are some really serious, difficult issues ahead. I think soybeans are important to farmers, but, you know, for China, this is just another chip that it can turn on and turn off.

[Joe Matthew]

Okay, well, so that's my question. You mentioned 2017. We've got a deal here to buy at least 12 million tons of soybeans rest of the year than 25 million a year through 2028. Does history show us that China will actually do this?

[Mary Lovely]

I think it depends on U.S. activity. You know, President Trump has shown a penchant for, you know, suddenly one day something upsets him and he's got 100%, 140% tariff on China. If he does so he knows that 25 million bushels of soybeans are at play. So in this sense, that gives another, another, another tool to China.

[Joe Matthew]

Do we believe that Taiwan quote never came up, unquote. As President Trump said, it's highly possible.

[Mary Lovely]

I think right now we all benefit from as little attention to Taiwan as possible. You know, a continuation status quo, I think is in the long term interests of, you know, global economic stability. So if it didn't come up, I think that's probably good. We are focused on very short term issues here. And again, it's important that this was resolved and resolved quickly. But that doesn't mean that in any sense we're not, we're not looking at a rocky road ahead. Now, that road doesn't have to be rocky, but it has to be serious and it has to be deep in thinking about, you know, the cost benefit on where we really need to decouple in some sense from China. What are the parameters for tech integration? You know, Joe, you mentioned that we hadn't heard anything about the TikTok deal. The Chinese media and scholars were looking to see what the parameters there were that were going to be acceptable to both sides. We had a teaser on Blackwell chips. You know, what is the acceptable level of integration? This is important because we're moving very, very quickly into the air where China is going to be very competitive in embodied intelligence. The that use AI to bring those productivity improvements to fruition. Where are we with being able to purchase those and allow our allies to purchase those?

[Joe Matthew]

Yeah, I'm glad you mentioned in video because the market was breathless about Blackwell's yesterday. It sent in video stock to a new high. People couldn't believe it. How could this suddenly be on the table. What's going to happen? It's potentially so irresponsible. We had Republicans and Democrats from the Senate saying so on the program last evening, and then nothing. China will talk to Nvidia and others, the president said, about buying more high tech computer chips, and that's a good thing. Where are we going with Nvidia?

[Mary Lovely]

I think we're seeing tensions within the administration on how we are going to approach these, the national security concerns, particularly around advanced chips. Something that we thought we were, you know, controlling to the best of our ability. And it was always, as you know, Joe, very imperfect. China was still getting access to a lot of the most advanced chips. But we saw a big escalation a few weeks ago when the Trump administration moved to put the foreign affiliates of Chinese companies on the entity list, on the entity list themselves, something that expanded those lists by close to 20,000 firms. The Chinese obviously reacted to not very negatively and came out with a series of export controls of their own, which would have been deeply destabilizing. We saw a little bit of rollback of those. President Xi has said that he's not going to put really what Jared controls on third party sales of goods that contain rare earths, but they maintain their licensing system. So what was that about? What was this escalation in the middle of negotiations by Secretary Bessen and his team with the Chinese and then the President teasing on the Blackwell chips. So, again, I don't think we have much clarity on where these lines are going to be drawn.

[Joe Matthew]

We've got about a minute left here, Mary. The President will travel to China in April, he says, with further talks in store with President Xi. Apparently Xi has agreed to a return trip further down the line. These are months away. What will need to happen for Donald Trump to go back to China? And could that generate an actual deal?

[Mary Lovely]

I could. They have to. I think the American team has to decide where they're going to make these compromises and not provide any more easy wins to the Chinese. The Chinese have always had short term escalation, dominance as, as Adam Posen has written. And here we need to really be careful not to give them any more tools. And that means that the US Needs to continue to do the hard work of raising its own economic resilience. Ye. And we're starting to do that looking for alternative deals on critical minerals. But we know those are, those are something that can't be just snapped into place.

[Joe Matthew]

Yeah, well, we've got a lot to figure out still, I think. And it's Great to have you back Mary. Let's keep this conversation rolling certainly until next April. Mary Lovely Peterson Institute for International Economics A fascinating conversation and we thank you for joining us. That'll be on the podcast. I'm Joe Matthew, this is Bloomberg. Stay with us on Balance of Power. We'll have much more coming up after this.

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[Joe Matthew]

We're looking at you from Washington with our eyes on New York and we're going to be up there next week. I hope you'll join us with special coverage on Election Day as we balance races in New York, New Jersey, Virginia. We've been talking about them as they, according to some, at least play into this government shutdown. Or maybe it's the other way around. We'll find out together next week whether the elections themselves bring any off ramps. But the polling is what has us compelled today because we've been getting a lot of numbers recently on the New York mayoral race and they just don't agree. Which is making us wonder where this race actually is. If you ask the good people at Emerson College, their polling institute, they'd tell you there's a 25 point lead for Zoran Mamdani and that's the type of number we've been hearing, right? 20, 30%. It's going to be a blowout. They say. Get ready for an early night. Many ask Marist College. Well, They've got a 16 point lead in a three way race for Mamdani. Okay, that's a little bit more restrained. And we're putting these up on the screen for you so you can play along on your home game. The Quinnipiac University poll out Today, however, shows us 43% of likely voters support Mamdani, putting him only 10 points ahead of Andrew Cuomo. Let's play it to the panel and get their sense here. Lisa Camuso Miller is with us today. Republican strategist, no stranger to New York, York and New Jersey politics, former RNC communications director and senior vice president with ROC Solutions. She's the host of the Friday Reporter podcast. Megan Hayes is with us as well, Democratic strategist and special former special assistant to President Biden. Great to have you both here. Lisa, I'll start with you in your old backyard, what do you do when you're trying to read a race that has this much noise in the polling numbers? I'm sure that most campaigns would be very happy with a double digit lead need, but that's a far cry between 25% and 10% for Mamdani.

[Lisa Camuso Miller]

There's still pretty good numbers though, Joe. You know, it's going to, I think it's going to come out to turn out. Sounds like early voting is really happening, happening strong and a lot of it, I mean, sounds like Brooklyn is really leading the race here. Staten island and the Bronx are also lagging behind. So it's going to come down to what the issues are. And the issues are street safety and economic stability. And those are the ones that are really going to be interesting to see who comes through. But you know, my money has got to still be on Mandani all the way. Even though Cuomo really does have an operation, he has a political operation that he's used and used well over time. New York City is a far different animal than New York State.

[Joe Matthew]

Yeah, for sure. What do you think of these numbers, Meghan? How do you spell blowout? 10% or 25%?

[Megan Hayes]

I think anything you only have to win by one vote. So I think that he's, you know, these polling numbers, if there are any indicators are showing that he'll be fine and it will be probably be an early night. I do think it's interesting that you do see some more business, business people and more the wealthy class of New York City starting to sort of get a little bit anxious and you see them getting more involved, more commercials going up. So I don't think, I think it's a little too late for that. But I do think the early vote is the numbers are already staggering to what they have been in the past.

[Joe Matthew]

Well, let's talk about Andrew Cuomo here for a moment who by the way, was endorsed yesterday by Michael Bloomberg. To be clear, in the New York City mayoral race, Michael Bloomberg has also donated to a super pack back supporting Cuomo. And Michael Bloomberg is of course the founder and majority owner of Bloomberg lp, the parent company of Bloomberg TV and Radio. So here we are. Whether endorsements matter in this case could be its own show here, Meghan, but we're looking at a world in which moderate Democrats and Republicans are warming up to the idea of Andrew Cuomo as mayor. Could it make a difference?

[Megan Hayes]

I just think it's a little too late. And I think a three person race, it's interesting because people wanted Curtis Lewis to drop out, but I'm not sure that that really made makes a difference. If Republicans are going to vote for somebody, they're going to vote for Cuomo. So I just, it's, I just think it's a little too late. I think that maybe if this was going, if we were having this conversation three, four weeks ago, we might see a different outcome next week. I just, I just think that he's run, the clock is running out here.

[Joe Matthew]

What would you tell Andrew Cuomo to do as a Republican strategist, Lisa, to try to get those votes over the next couple of days?

[Lisa Camuso Miller]

I mean, he's got to continue to talk about stability. I mean, Republicans, the market, New York City, they like stability. They like to know what to expect and they like to know that someone that can come into that office can actually make a difference. So that's the message that Cuomo, I think, has been resoundingly using over and over again. Experience, experience, experience. Voters in New York have made this decision before. I mean, we've seen the last two mayors that were elected, there were unconventional candidates. I think New York likes to switch it up and I think Bumzani is going to be just fine on election night. But if I'm Andrew Cuomo, I'm talking about stability and I'm talking about predictability because that's, I think what people want to see, especially with a president that represents a little less of that, that.

[Joe Matthew]

Interesting in terms of other endorsements, Tom Suozzi, even Mike Lawlor, the Republican, has endorsed Andrew Cuomo. Pretty fascinating to consider. Where we're at here when Mike Lawler is endorsing Andrew Cuomo, what does that say about the race? I guess it's a statement more on Mandani than it is.

[Megan Hayes]

That's a vote against mommy, not for Andrew Cuomo. And I think that's a lot, a lot of what people are doing. It's very similar to what you saw Democrats do in 24. They voted against Trump, not necessarily for Kamala Harris. So I think just it's. There's a lot of parallels there. But I mean, I just. Their numbers aren't there for Cuomo to win at this point, but I do think it's important for people who do not believe in his views to endorse somebody else. I think you just shouldn't always go along with your party just because. So I do have a lot of respect for Tom Swazi and for Mike Lawler for coming out and endorsing Cuomo.

[Joe Matthew]

Yeah, well, all right. So, you know, the real stuff comes down sometimes to how local you can get. Lisa, you reminded us in the New Jersey gubernatorial race that the difference between pork roll and taylor ham could in fact declare the winner in this race between Mikey.

[Lisa Camuso Miller]

Cheryl, I'm not sure that it was whether.

[Joe Matthew]

Stop me if you want. It was knowing which was which. So I'm going to ask you again. You remember in the, in the last debate for the New York mayor, they were asked at the end, what is your breakfast Bodega order. We're going to have to see if we can pull this out here. We can't use it.

[Tyler Kendall]

All right.

[Joe Matthew]

I guess I'll get sued if I play that. Mamdani had a different answer than the other two. I think it was something on a bagel. It was egg on a bagel with jalapenos. I'll have to go back and read this.

[Lisa Camuso Miller]

With no salt.

[Joe Matthew]

That was Andrew Cuomo and Sliwa had no salt. But guess what? He just landed. Mamdani landed the United Bodegas of America endorsement. Lisa, is this thing shut down?

[Lisa Camuso Miller]

I don't know that that makes a difference, but those are a vote from small businesses that are looking at a candidate that they think can make a difference for them. And that's where that, that's where that makes a difference, I think, more than anything, because that city is full of small business owners who really want a mayor that can help make change.

[Joe Matthew]

Egg cheese, jalapeno. Thank you, Cece. Not just small business, but small businesses owned and operated by immigrants.

[Megan Hayes]

Yeah, actually, I think that's actually really interesting for someone who wants government run grocery stores as the union for the bodegas is coming.

[Joe Matthew]

Which they opposed initially.

[Megan Hayes]

Exactly. So I do think that is a really interesting dynamic here. But I also think they, they see the writing on the wall, they're reading the same polls we are. And they also know that they're going to have to work with Mandami's office. They're going to have to rely on him for different regulations, all sorts of things that the city government is responsible for. So it's, it's a smart play, political play by them.

[Joe Matthew]

Yeah. Lisa, this is going to take place, of course, the same day that we have elections, as I mentioned, in Virginia and New Jersey. Are you in the same place when it comes to Cittarelli in New Jersey?

[Lisa Camuso Miller]

Yes, I am. I'm still watching it closely and I think that it's going to be a very close race in New Jersey. New Jersey never disappoints. It's always down to the last minute. But I think it's going to be a good night for four Democrats. And I think that I hope for them that they don't over index on the fact that they were successful because it's less about. It's less about their candidates, more about the issues. And they're going to have to pay very close attention to what this means for the midterm terms.

[Joe Matthew]

I think you're expecting a blowout for the Democrat in Virginia, Abigail Spanberger. How about New Jersey? How come Mikey Sheryl is not doing better right now?

[Megan Hayes]

I think just, just like what Lisa was saying. I think affordability issues, and I think that those are really hard issues to break through. And I know she's really leaned into the energy prices. I know she's leaned into some child safety issues. I think the Trump factor here is really important. I think Cittarelli was really hanging his hat on Trump and I do think that is concerning for a lot of Democrats and people. Just the crazier things that Trump does, the worse it is, I think when you're in these, some of these states for the midterms. But I do agree with Lisa. Dems need to be really careful here. If they are victorious like it is, showing that they might be, they need to really watch and really hone in on those affordability issues. Leaning into the midterms and not just get comfortable.

[Joe Matthew]

Understood. She have the energy, the charisma? Is she the right candidate? Because there's been a lot of questions about candidate quality here.

[Megan Hayes]

I think she's great and I think that she will be a great governor. She is very moderate. She knows what she's doing. She will govern on day one. I think she, she is a new generation for Democrats. She has a national security background. She brings different style of leadership and that's okay. And the Democratic Party needs that. And I am welcome. I welcome her and I welcome Abigail Spamberger. And they both are victorious. I think they are great leaders to look forward to for our party.

[Joe Matthew]

Anyone who's living in Virginia or the D.C. area is looking forward to these ads coming down. Lisa, where will New Jersey be decided?

[Lisa Camuso Miller]

I think I'd pay very close attention to North Jersey, right in the shadows of Wall street where folks live. I mean, Bergen county will always go Republican, but some those other northern counties went for Trump last go around. And so that's going to be. We're going to have to watch and see the other thing too. Joe, I'd like to point out is that this is the first time in my history that I can ever remember that two females would lead the governor's office if in fact they both win on Tuesday.

[Joe Matthew]

How about that? Producer James reminds us the Emerson Poll that I mentioned for the New York mayoral race has numbers on New Jersey gubernatorial. Cheryl is 49 to 48, eight over Citterelli. Is that how close this race is?

[Megan Hayes]

Yeah, I think so. I think it's going to be extremely close. It might be more than one point, but it is going to be close and it will not be called right away. You know how some of these are just called right close? I think it's going to go 10, 11, maybe even midnight. So I think that Virginia and New York will be called much earlier. But I think we're in for a little bit more of a wait for New Jersey.

[Joe Matthew]

You see this as a one point contest, Lisa?

[Lisa Camuso Miller]

I think it can be very close. I mean, Joe, I hate to say it out loud, but it's the kind of thing last time Jack Cittarelli ran for governor, he was so close that they had a recap count. So I think that there's going to be a lot of it could be a late night. We could be well into days after the election. That's how close I think it's going to be in New Jersey.

[Joe Matthew]

Well, this is going to be a riot. And as I mentioned, we'll have special coverage that'll be next Tuesday live from New York here on Balance of Power. Many thanks to our great panel. This is a great conversation and fun to get ready for these elections with Lisa Camuso Miller and Megan Hayes. We thank you both. We've got another breaker here on the terminal. The FAA has just issued a ground state stop for Washington Reagan National Airport. It's not a mechanical problem this time. They say it's due to staffing so here we are. We have arrived and we'll have more on this coming up when we spent some time with Congressman Jake Auchincloss, the Democrat from Massachusetts. Up next here on Balance of Power only available on Bloomberg TV and Radio. Stay with us On Balance of Power. We'll have much more coming up after this.

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[Joe Matthew]

Play Bloomberg 11:30 We've got a ground stop, another one at National Airport, Reagan national here in dc. That's DCA if you want the airport code and it's not new. We've been seeing a lot of ground stops there. Yesterday there was one. In fact it was blamed on military activity. Today it's a different matter. It's due to staffing and this is something that we had feared. Many have predicted that we begin seeing ground stops at airports around the country because of the government shutdown. Remembering that air traffic controllers are not being paid. Many are working 60 hours a week, already were and suddenly they're doing so without a paycheck check. Of course they will be made whole, presumably when this is over. But the unions are already squawking and we have seen some slowdowns at airports. We've seen a lot of delays and cancellations, but not a full on ground stop like this. Certainly in the nation's capital due to staffing. This is going to be the subject of a meeting taking place today at the White House. By the way, there's a live view of National Airport if you're with us on Bloomberg TV, J.D. vance, the vice president, will be holding forth the CEOs of American and United Airlines and will also be with Transportation Secretary Sean Duffy and Chris Sununu, who now runs, as he told us in person on a recent edition of Balance of Power, the airline trade group that will all be part of this conversation today. Whether something comes from this in terms of a new policy or a way to pay air traffic controllers is another matter. But it's where we start our conversation with Congressman Jake Auchincloss. The Democrat from Massachusetts, importantly serves on the Committee on Energy and Commerce, which oversees the faa, among many other important entities. And he's with us now on day 30 of the government shutdown. Congressman, it's good to see you. How concerned are you? Or maybe you can even tell us based on what you're hearing of more events like these happening around the country, inevitable.

[Congressman Jake Auchincloss]

The air traffic controls have been warning about this. They're working without being paid. Contrast that with Speaker Johnson, who's being paid without working. The speaker needs to call the House back into session. I will go to Washington today, probably by train, not by airplane, and start negotiating with Republicans. Before this shutdown, I offered a series of proposals to get to yes, from reversing the worst, the Medicaid cuts to funding local law enforcement to giving Congress a vote on tariffs. And it's been radio silence since the Then the president and Republicans are in charge. This is their responsibility.

[Joe Matthew]

Well, you know, it's, it's something the House has been out what you probably know more than I, better than I, congressman. I think 45 days since before the government actually shut down, having passed the clean cr and the Speaker's rhetoric remains the same. We've done our job. You let us know United States Senate, when you're ready to do yours. But we have heard that John Thune is preparing to start talks with some rank and file Democrats. Do you have any sense that that's true or when that might start?

[Congressman Jake Auchincloss]

I do think that's true. And we need to get to yes. And again, the proposals that I and other Democrats in the House put forward are not partisan proposals. I mean, allowing Congress to vote on the tariffs, which have been the biggest tax hike in modern American history and that were imposed unilaterally and illegally by the president is not exactly like a lefty talking point. I mean, that is just right down the middle of constitutional governance and the middle class.

[Joe Matthew]

Tell us more about what's happening in the air traffic control towers and what could be done to prevent massive closures. You said it's inevitable that we'd see things like this. Can anything be done to contain these ground stops at airports if in fact controllers stop showing up?

[Congressman Jake Auchincloss]

I don't want to conjecture what I can say from my time talking to air traffic controllers when I was on transportation infrastructure, the committee with jurisdiction is that when you have these government shutdowns, the air traffic controllers will start taking other types of jobs to make ends meet and will call out in order to go to those other jobs, they got to put food on the table for their family. They're going to make rent. And that will lead to staffing shortages, which creates unsafe conditions, which create eighth ground stops.

[Joe Matthew]

And here we are with potentially more in the offing. Does, does November 1st matter anymore, Congressman? That's open enrollment, of course, and potentially the end of some SNAP benefits. The beginning of the end. But now there are efforts to try to overcome those legislatively, at least in terms of the SNAP benefits. As another potential pain point is taken off the calendar, what do you think is going to happen when we get into the new month?

[Congressman Jake Auchincloss]

Yes, it matters. The president calls it a Democrat program. Snap. It's not. It's a program for children. Two thirds of the recipients of SNAP are families with children. This is about kids going to school with a full belly. And illegally withholding those SNAP funds is callous and cruel.

[Joe Matthew]

Your governor's taking action on this, right? Is Maura Healey going to manage to bridge the gap here? Obviously, we don't know how long the gap might be, Congressman, but it looks like a lot of governors, a lot of states are stepping up.

[Congressman Jake Auchincloss]

Governor Healey's always stepping up, whether it's backfilling science funding, whether it's energy. After the president arbitrarily canceled offshore wind permits. Now with SNAP benefits, she's always patching holes and protecting Massachusetts. But she can't cover the full gap on snap. No governor can. This is a federal program. It's federally funded. It needs to be federally delivered.

[Joe Matthew]

As we spend time with Congressman Jake Auchincloss, we want to tap your experience, Congressman, when it comes to geopolitics and the Pentagon, of course, you are a combat Marine veteran and will remind our audience that you commanded an infantry in Helmand Province in Afghanistan in 2012, as well as a reconnaissance unit in Panama in 2014. The president, yesterday, before he sat down with President, President Xi took to Truth Social to talk about resuming nuclear tests here in the United States. I suspect you saw this. It's a pretty big deal directing the Pentagon to test nuclear weapons for the first time since 1992. We're unfortunately not sure exactly how this is going to work, though. He said that testing should occur, quote, on an equal basis, unquote, with Russia and China. Is this a smart move and what would it accomplish?

[Congressman Jake Auchincloss]

Nothing. He's trying to saber rattle to distract from the fact that he started a trade war with China and American farmers are now losing it because soybeans are more fungible than rare earth minerals. And so China gained leverage over the United States rapidly this summer and has now used it to cause Trump to tuck his tail between his legs. And as he always does, he's trying to strongman his way out of that perception. Anybody who's paying attention sees it now. Here's what he should have done. He should have embarked upon a bipartisan industrial policy focused on American energy dominance, adding two to four quads of energy production per year, including the necessary control over rare earth supply chains. Number two, he should have used targeted sanctions and tariffs for the fentanyl export issue and for critical industries. And Congress has a lot of bipartisan legislation for that. And then finally, he should have inked a TikTok deal again, according to congressional statute that it gives Americans control over the most important media and information platform in the world. He has failed to do all three of those things. And so now he's trying to blow stuff up to make himself look tough. It's not going to work.

[Joe Matthew]

Are you encouraged that Blackwell chips were not part of any deal making yesterday?

[Congressman Jake Auchincloss]

Well, I mean, the President took a stake in Nvidia's export of chips to the Chinese Communist Party. So he's literally trying to give the US Government like equity in equipping China to leapfrog us in AI inference. It's his version of state directed capitalism is going to enrich his family, that's for sure, with their crypto schemes. Probably $5 billion worth.

[Tyler Kendall]

Worth.

[Congressman Jake Auchincloss]

But it's not going to be good for America Incorporated. All it's going to do is so further uncertainty amongst investors and entrepreneurs when what these investors and entrepreneurs really need is abundant, clean, cheap, reliable energy. And this President has been inhibiting rather than amplifying that. That should be our industrial policy. Forget all this crony capitalism. Focus on American energy.

[Joe Matthew]

We could, gosh, we could do a whole show on this. Congressman, this is fascinating to me. When it comes to the likes of Nvidia, Jensen Huang would say, hey, if we want to win the AI race in this country, you need to get the world on the AI stack. And that of course, runs counter to folks like yourself, your opinions on this? We're providing some of the highest end AI chips to China would in fact be a national security violation. Is Jensen Huang simply wrong about this?

[Congressman Jake Auchincloss]

Jensen Huang is talking his own book, which is what a private company CEO is going to do. The President, states should be looking in a long term way about American competitiveness. And the most important questions about how the US out competes China in science and technology are not about China. China's got 1.3 billion people. Their kids are outperforming our kids on math and science scores. They're investing huge amounts in basic research. China is going to be a powerhouse. There's nothing we can do to prevent that. What we can do is double down on what's made this country a behemoth of free enterprise. We got to double the NIH and National Science foundation budget. We got to attract the best and brightest from the world over. We've got to protect intellectual property, guarantee a sound currency, expand global markets for our entrepreneurs. It's all the stuff that's simple but not easy. And this President is replacing it with, you know, Trump Incorporated, where if you want to do business in America, you got to buy his son's crypto coins.

[Joe Matthew]

Hmm. You mentioned energy, Congressman. We're coming off the Nvidia GTC conference this week here in Washington D.C. and there's been enormous talk, of course about harnessing clean, renewable energy for data centers that are popping up like weeds all over the country here. Some think the answer is nuclear, small modular reactors, but that could take some time. And so I'm wondering what it is you refer to. Is it natural gas? How do we get get these data centers powered up without hiking electricity bills in the state of Massachusetts.

[Congressman Jake Auchincloss]

And electricity bills are going up double digits in Massachusetts and Virginia in other states. It's going to be different in different states. Some places it might be Hydro. Massachusetts, offshore wind could have been part of the solution until the President canceled it. It's going to be natural gas in some areas. I think one common one though is next generation geothermal. You got companies like Quaize, which is doing millimeter wave drilling that can go five to seven miles deep, which means that it's hot everywhere. You don't have to go to Iceland, right? Anywhere you dig or drill, it's hot. And that allows us to create high, baseload, affordable, reliable electricity that is clean in states across the country.

[Joe Matthew]

You know, one thing that we haven't had a chance to talk about with regard to the government shutdown that ties into what we are discussing with regard to energy is heating oil assistance in Massachusetts. It's getting to be that season to fill the tank, Congressman. It already is that season in Massachusetts. It's been in the 30s in the morning recently. In our remaining moment, what will this mean for assistance in your state?

[Congressman Jake Auchincloss]

The Low Income Heating Assistance Program is a mainstay for Massachusetts families. We should expand the program as I've consistently advocated, and ensure that families are able to keep homes warm during a New England winter. But again, that's a short term issue. In the long term, what we need is energy independence that comes from adding more supply onto the grid. In Massachusetts, our biggest problem is not transmission, it's generation. We need next gen geothermal. We need nuclear, we need offshore wind, we need hydro from Quebec. We need all of it and more.

[Joe Matthew]

This is why he's on the Committee on Energy and Commerce. Congressman Jake Auchincloss, thank you sir for the time. It's good to see you and we appreciate your insights here on Bloomberg Democrat from Massachusetts 4th 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 [e-mail].

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