Bloomberg Businessweek — "Trump Threatens ‘A Lot’ of Firings in Looming US Shutdown"

Date: September 30, 2025
Hosts: Carol Massar and Tim Stenovec

Episode Overview

This episode dives into the looming threat of a US government shutdown as Democrats and Republicans remain deadlocked over funding. President Trump is making headlines by threatening mass firings of federal employees if a shutdown occurs, triggering anxieties across the political and economic landscape. The discussion explores the political motives and strategies behind the standoff, the historical context of shutdowns, the role of key White House figures like Russ Vought, and the ripple effects for sectors such as biotech and public markets. The episode also features broader market analysis, the impact on pharmaceuticals, innovation in biotechnology, and investment trends in the age of AI.

Key Discussion Points & Insights

1. US Government Shutdown Standoff

• Context of the Crisis

  • As the shutdown deadline approaches (midnight tonight), congressional negotiations have stalled, with each party calculating that a shutdown will serve their political interests.
  • President Trump threatens sweeping federal workforce cuts, intensifying stakes.

• Democratic and Republican Positions

  • Democrats:
    • Want to be seen as tough against Trump, especially on policy.
    • Push for extension of Obamacare (ACA) subsidies that expire at year-end.
  • Republicans:
    • Passed a "clean" continuing resolution (CR) to fund the government through Nov 20, claiming the moral high ground.

"[Republicans] have already passed via the House what is known as a clean CR...they feel that they have a moral high ground."
— Nathan Dean, Bloomberg Intelligence (02:52)

• Political Calculus
  • Both sides believe that a shutdown could benefit them politically, referencing 2013’s Tea Party standoff as precedent.
  • Local politics are in play: states like Virginia and Maryland would be heavily affected due to large federal workforces.

"...both parties feel they are in the best political position possible and that both sides think that a shutdown will end up helping them politically."
— Nathan Dean (02:52)

Timestamps

• [01:00] — Introduction to the looming shutdown crisis
• [02:52] — Positions and demands of both parties
• [04:01] — Political implications and historical parallels

2. Russ Vought, Project 2025, and Federal Workforce Cuts

• Who is Russ Vought?
  • Head of the Office of Management and Budget during Trump's term, architecting a vision to consolidate executive power and “shrink the deep state.”
  • Major force behind Project 2025, planning for drastic changes in a second Trump term.

"He is one of these kind of behind-the-scene intellectuals who helped shape this presidency...after Trump's last term, spent four years essentially planning for what this presidency was going to look like."
— Max Chafkin, Co-host, Everybody’s Business Podcast (05:42)

• Philosophy & Legal Battles
  • Advocates for the “unitary executive” — more direct presidential control over federal agencies, less power for “unelected bureaucrats.”
  • Previous efforts at mass layoffs (the Doge and Musk episodes) backfired with the public; now sees shutdown as a leverage point to enact deeper cuts.
  • Legal controversies expected around the Impoundment Control Act if Trump administration pushes the envelope on budget authority.

"...a government shutdown would be a huge opportunity for Vought and for people who are sort of aligned in this direction to do something that they want to do for a very long time, which is essentially take a bite out of the federal government."
— Max Chafkin (06:45)

Timestamps

• [05:03] — Introduction to Russ Vought’s influence
• [06:45] — Shutdown as opportunity for drastic federal cuts
• [08:31] — Mechanics of job cuts during a shutdown

3. Legal and Constitutional Tensions

• Balance of Powers Concerns
  • Shutdown tactics raise questions about the separation of powers, especially if the executive claims authority to override congressional budget decisions.

"What does it mean if ultimately, though, the power of the purse is not in the hands of Congress?"
— Carol Massar (09:50)

• Supreme Court & Legal Ambiguity
  • Potential for Supreme Court intervention regarding “pocket rescissions” (unspent appropriated funds).
  • Russ Vought has openly questioned the constitutionality of the Impoundment Control Act, hinting at future legal battles.

Timestamps

• [09:50] — Congress vs. executive power, legal challenges
• [11:17] — Vought’s vision and legal endgames

4. Why Not Just Cut ‘Bloat’?

• Practical and Political Obstacles
  • Both parties regularly talk about trimming the federal government, but the complexity is staggering:
    • The Federal Register runs over 430,000 pages; making cuts without violating statutes/regulations is daunting.
    • Voters consistently resist any cuts that affect their own states or interests.

"If it was easy, they would have already done it...you have to comb through 430,000 pages and...decide if you’re going to cut something [without breaking] a statute or regulation."
— Nathan Dean (12:47)

"The answer is voters—voters don’t want a good cut. And they’ve showed it over and over again."
— Max Chafkin (13:10)

Timestamps

• [12:24] — Caller question: Why not downsize the government?
• [13:10] — The role of public resistance

5. Broader Market and Industry Impacts

A. Market Performance and AI Trends

• Market Breadth & Volatility
  • AI and tech lead the markets, but there’s diversity behind headline numbers.
  • Defensive sectors (utilities, staples) diverged in performance; market is less concentrated than in the late '90s dot-com era in some respects.
  • "Circular financing" (companies investing in each other) raises risk of concentration.

"Nothing sedates irrationality like effortless money being thrown around."
— Warren Buffett (quoted by Kevin Gordon, Charles Schwab) [18:49]

• Labor Market Concerns
  • Rising youth unemployment is an outlier, reminiscent of prior recessions.
  • If labor market continues softening, even strong AI trends may not be enough to uphold the economy.

Timestamps

• [16:53] — 2025 market roundup & sector highlights
• [18:31] — Risks of circular financing & market concentration
• [20:39] — Expectations for AI and market realities

B. Impact on Pharmaceuticals and Biotech Innovation

• Policy Whiplash
  • Major drug companies (Pfizer, Eli Lilly) see their fortunes sway with White House edicts, tariffs, and regulatory deals.
  • Pharma executives (Pfizer CEO Bourla) negotiate with administration figures, seeking exemptions or price concessions.

"Startups...are made or broken on a single clinical trial...if that money does not come in, that money does not get invested...will the administration stifle innovation if they require companies to lower prices?"
— Tim Stenovec (28:00)

• Sustaining Biotech Innovation
  • Venture investors like Jenny Rook (Genoa Ventures) focus on long-term fundamentals, predicting innovation’s necessity outlasts short-term political turbulence.
  • Ongoing concern: balancing free-market rewards, government and philanthropic funding across the innovation pipeline.

Timestamps

• [26:04] — Pharmaceutical tariffs and pricing
• [27:19] — Outlook on biotech innovation amid policy chaos
• [28:27] — The dilemma of drug pricing, R&D, and capital formation

6. Future Investing, Gold, and Technology Themes

• Gold’s Appeal Amid Uncertainty
  • Gold surges as a global safe haven amidst US policy volatility and geopolitical tension.
  • Despite price gains, US investor enthusiasm remains muted.

"Gold is the second global currency, right?...Because of policy uncertainty, war in Europe, Ukraine, Russian reserves being seized after the Ukraine invasion."
— Jan VanEck, CEO, VanEck (40:37)

• AI & Tech “Revolution”
  • Big Tech's dominance (the “MAG 7”) may continue to grow, driven by scale, profitability, and relentless investment in AI.
  • Nvidia’s exponential chip demand and competitive moat highlighted as unique in tech history.

"We're in the middle of this kind of technology revolution that we haven't really seen before. And these big companies are really well positioned."
— Jan VanEck (43:30)

• Innovation in ETFs & Private Markets
  • VanEck discusses specialized ETFs and growing investor appetite for access to private market unicorns and alternative assets.

Timestamps

• [38:09] — Government shutdown and fiscal spending impacts
• [41:34] — Gold as a geopolitical and market hedge
• [41:47] — AI, S&P dominance, tech productivity
• [44:19] — Expansion of ETF offerings into private markets

Notable Quotes

• Nathan Dean:
  "Both sides feel that they are in the best political position possible and that both sides think that a shutdown will end up helping them politically." (02:52)

• Max Chafkin:
  "...a government shutdown would be a huge opportunity for Vought and for people who are sort of aligned in this direction to do something that they want to do for a very long time, which is essentially take a bite out of the federal government." (06:45)

• Jenny Rook:
  "We just try to look through all of the noise and think about how to keep using innovation to solve problems." (27:21)

• Kevin Gordon (quoting Warren Buffett):
  "Nothing sedates irrationality like effortless money being thrown around." (18:49)

• Jan VanEck:
  "Gold is the second global currency, right?...There’s so many things happening, I think that people are nervous and they say, okay, what else can I buy? And they can buy gold." (40:37)

Memorable Moments

• Lively exchange about why federal downsizing never happens:
  Nathan Dean: "If it was easy, they would have already done it...both sides said they'd want to do it. But if they wanted to do it, they would have already done it." (12:47)

• On public resistance to cuts:
  Max Chafkin: "The answer to that question is voters, voters don't want a good cut. And when they've showed it over and over again." (13:10)

• On biotech’s need for stability despite Washington ‘whiplash’:
  Jenny Rook: "You have to put it in the context of other uncertainty." (30:05)

Episode Structure (with Timestamps)

| Segment Title | Speakers | Timestamps | |-------------------------------------------|-------------------------------------------|--------------------| | Shutdown drama and positions | Carol, Nathan Dean, Max Chafkin | 01:00–05:03 | | Russ Vought & OMB’s role | Max Chafkin, Carol, Nathan Dean | 05:03–09:50 | | Balance of Powers and legal tension | Carol, Nathan Dean, Max Chafkin | 09:50–13:16 | | Market performance & AI analysis | Kevin Gordon, Carol, Tim | 16:53–23:41 | | Pharma, biotech, and innovation | Jenny Rook, Carol, Tim | 26:04–35:25 | | Investing trends: Gold, Tech, ETFs | Jan VanEck, Carol, Tim | 38:09–45:52 |

Conclusion

This episode offers a rich, multi-angle dissection of the looming government shutdown, political maneuvering in Washington, and the policy and legal fights that could reshape the federal workforce and US governance. Equally, it highlights how market forces, tech revolutions, and sector-specific stresses (biotech, pharma) remain intertwined with politics. The result: a fast-changing, high-stakes environment with profound implications for investors, innovators, government employees, and the general public.