DISCUSS THIS IS BLOOMBERG NEWS CONGRESS EDITOR MEGAN SCULLY
AND WHITE HOUSE EDITOR MARIO PARKER.
GIVE US WHERE WE ARE AT THIS MOMENT ONE WEEK OUT.
WE ARE HEARING BETTER MOOD MUSIC BUT NOT EVERYONE IS
JOINING ON THE OPTIMISM BANDWAGON. IT SEEMS LIKE IT IS
NEUTRALIZING.
>> CONGRESSMAN MCHENRY HAS BEEN THE GLASS HALF-EMPTY OF THE
NEGOTIATORS. HIM BEING NOT PESSIMISTIC I
WOULD SAY IS A SMALL STEP FORWARD TOWARD THE DEAL SO THAT
IS GOOD NEWS. TODAY THERE HAVE BEEN A LOT OF
PHONE CALLS AND ZOOMS BETWEEN THE WHITE HOUSE TEAM AND THE
GOP NEGOTIATORS IN THE CAPITAL. THEY HAVE NOT MET IN PERSON YET
TODAY BUT THEY HAVE BEEN COMMUNICATING.
WE PRESUME GOING BACK AND FORTH WITH NUMBERS IT DOES APPEAR
SOME THINGS ARE SQUARED AWAY. THERE WILL BE SOME KIND OF
ENERGY PERMITTING LEGISLATION. ALSO SOME SWEETENERS FOR
PROGRESSIVES TO DO WITH ELECTRIC TRANSMISSION LINES.
DEFENSE SPENDING IT APPEARS WILL NOT BE AS HIGH AS
REPUBLICANS HAD HOPED. IN LINE WITH LET BIDEN HAD
PROPOSED EARLIER THIS YEAR WHAT THERE IS STILL A LOT OF PIECES
THAT NEED TO TAKE SHAPE INCLUDING DOMESTIC SPENDING,
THE LENGTH AND SIZE OF THE DEBT CEILING INCREASE AND WHETHER OR
NOT WORK REQUIREMENTS ARE GOING TO BE IN THERE. JOE:
YOU PUT IT BEST. IT IS ONE THING TO CUT A DEAL.
IT IS ANOTHER TO GET IT PASSED THROUGH CONGRESS.
A LOT OF CONCERNS THE PRESIDENT MAY BE LOSING PROGRESSIVES.
THAT SPEAKER MCCARTHY MAY BE LOSING MEMBERS OF THE FREEDOM
CAUCUS. THE HOUSE MINORITY LEADER
JEFFRIES TOUCHED ON THIS EARLIER.
>> WHAT IS CLEAR TO ME INCREASINGLY IS MANY EXTREME
MAGA REPUBLICANS HAVE MADE THE POLITICAL CALCULATION A
DANGEROUS DEFAULT AND CRASHING THE ECONOMY AND TRIGGERING A
RECESSION IS IN THEIR POLITICAL INTEREST. JOE:
ONE CONCERN FOR DEMOCRATS AND THE PRESIDENT, WE CUT A DEAL
WITH SPEAKER MCCARTHY BUT WE DON'T KNOW IF HE HAS THE VOTES
IN HIS OWN REPUBLICAN CAUCUS. IS THAT SLOWING THINGS DOWN?
>> ABSOLUTELY. THAT IS PART OF WHAT IS BEING
DISCUSSED RIGHT NOW. LOVE THIS IS OCCURRING FOR THE
BACKDROP OF WHAT WE SAW IN JANUARY WITH THE 15 VOTES FOR
HIM TO GET THE GAVEL. IT HAS INFORMED A LOT OF THE
WHITE HOUSE IS THINKING. SOME OF IT HAS BEEN A
MISCALCULATION ON THE PART OF THE WHITE HOUSE BUT THAT IS
SOMETHING THAT IS IN ELEPHANT IN THE ROOM WHETHER HE CAN HOLD
HIS CAUCUS TOGETHER. WHAT DEGREE PRESIDENT BIDEN CAN
HOLD THE DEMOCRATS TOGETHER AS WELL. JOE:
IT IS A SIMILAR STORY ON BOTH SIDES.
ANNMARIE: WE HEARD FROM SPEAKER MCCARTHY
AND THIS IS WHAT HE HAD TO SAY. HE IS TRYING TO SIT DOWN WITH
THE PRESIDENT BUT THERE PROGRESSIVES SHE HIM.
LET'S TAKE A LISTEN TO WHAT HE HAD TO SAY EARLIER.
>> THE DIFFICULT PART IS THE DEMOCRATS TODAY ARE NOT THE
SAME DEMOCRATS. THEY ARE ON THE SOCIALIST LOOP.
WE SEE THEM UP THEIR ANGER AGAINST THE PRESIDENT WHEN HE
IS TRYING TO CURB SPENDING. THAT IS NOT PRODUCTIVE.
IT IS CHALLENGING. ANNMARIE:
EVEN IF BIDEN WINS IN TERMS OF NOT DEFAULTING AND HE GETS A
DEAL, HOW MUCH DOES HE LOSE BECAUSE HE ANCHOR SO MANY IN
HIS PARTY?
>> 2024 IS UPON US. WE SAW THE UNRELATED TWITTER
DOUBTFUL LAST NIGHT. IT IS UPON US.
YOU'RE GOING TO NEED
PROGRESSIVES AND FOR SOMEONE OF PRESIDENT BIDEN'S AGE, HE IS
GOING TO NEED TO LEARN ON SURROGATES.
HE IS GOING TO HAVE TO LEAN ON THE AOC'S TO REALLY CARRY HIS
MESSAGE. WHILE THEY MAY STILL DO IT
BECAUSE HE IS A DEMOCRATIC RESIDENT, YOU WANT THEM TO HAVE
FULL BUY-IN AND BE ABLE TO LOOK THEIR CONSTITUENTS IN THE FACE
AND SAY THIS IS WHAT WE DELIVERED FOR YOU.
JOE: LET'S TALK ABOUT THE NUMBERS
BECAUSE NOTHING HAS BEEN HAMMERED OUT AND WE UNDERSTAND
THEY ARE GETTING CLOSER ON TOP LINE FIGURES.
WE ARE NOT GOING TO BE WRITING ANY BUDGETS HERE.
WE ARE LOOKING FOR SOME BIG NUMBERS.
WE DID HEAR ABOUT THAT FROM THE PRESS SECRETARY AT THE WHITE
HOUSE IF WE CAN GET TO HER COMMENT. LET'S LISTEN.
>> WE ARE NEGOTIATING WITH REPUBLICANS IN GOOD FAITH.
WE AS I MENTIONED YESTERDAY AND AS THE PRESIDENT MENTIONED
SUNDAY WE OFFERED AN ADDITIONAL CUT TO THE SPENDING OF $1
TRILLION ON TOP OF THE 3 TRILLION WE MENTIONED IN OUR
BUDGET. SO THIS JOE: IS OF THE BIG ITEM TO NEGOTIATE
HERE. TO ACTUALLY GET TO A NUMBER.
IT SOUNDS LIKE IT IS NOT GOING TO BE THE $130 BILLION THE
SPEAKER IS LOOKING FOR.
>> I THINK SO. WHAT THEY ARE TRYING TO DO IS
FIGURE OUT HOW TO COUNT THESE NUMBERS TO THERE IS WIDESPREAD
AGREEMENT TO CALL BACK SOME COVID SPENDING THAT WAS NOT
EVER USED BY THE STATES ARE THAT IS $65 BILLION RIGHT THERE.
THAT GETS YOU PUTTING MUCH HALFWAY TO THE 130 BILLION BUT
DO YOU COUNT THAT IN THE SAVINGS?
ARE YOU LOOKING FOR $130 BILLION ON TOP OF THAT?
YOU LOOK AT THE DISCRETIONARY BUDGET OR DO YOU LOOK INTO
MANDATORY PROGRAMS AND THE SOCIAL PROGRAMS THE GOVERNMENT
HAS TO PAY INTO? THEY ARE TRYING TO FIGURE OUT
NOT JUST WHAT TO CUT THAT HELPED ACCOUNT WHAT THEY CUT.
ANNMARIE: 65 BILLION OF THE UNSPENT COVID
FUNDS IS MORE THAN THE TREASURY HAS TODAY.
THE CASH BALANCE FELT AFFORD 9.5 BILLION DOLLARS, ONE OF THE
SMALLEST WE HAVE SEEN SINCE 2021.
DRAW THE REPUBLICANS TALKING ABOUT JANET YELLEN PUTTING
THEIR THUMB ON THE SCALE, THE TREASURY SECRETARY IS CORRECT
BUT IS IT NOT ODD THEY ARE ABLE TO KIND OF HAMMER OUT SOME OF
THE AGREEMENT IN TERMS OF THE ITEMS ON THE MARGINS WHETHER
HIS WORK REQUIREMENTS, DEFENSE SPENDING BUT THEY STILL HAVE
NOT BEEN ABLE TO FULLY COME TO A TOPLINE FIGURE?
ISN'T THAT WHERE THEY SHOULD BE STARTED?
>> YOU WOULD THINK SO BUT THERE ARE SO MANY INTERESTS AT STAKE
HERE AND THERE ARE SO MANY INPUTS. WE TALKED ABOUT THE
PROGRESSIVES. CARTHY IS DEALING WITH HIS
CONSERVATIVE FLANK. WHILE THE NEGOTIATIONS HAVE
WHITTLED DOWN TO A HANDFUL OF HAND-PICKED NEGOTIATORS, THAT
DOES NOT MEAN MEMBERS ARE NOT CALLING THE SPEAKER, ARE NOT
CALLING THE PRESIDENT. CONGER SPIN MCHENRY --
CONGRESSMAN MCHENRY SAID HE IS GETTING MESSAGES FROM WALL
STREET LEFT AND RIGHT AND HIS TEXT MESSAGES ARE A DUMPSTER
FIRE. THERE ARE A LOT OF COOKS IN
THIS KITCHEN. ANNMARIE: NO WONDER WHY HIS GLASS IS HALF
EMPTY. JOE:JOE: WE TALKED TODAY WITH MARK SANDY
ON BLOOMBERG SOUND ON ON BLOOMBERG RADIO.
THIS IS THE CHIEF ECONOMIST AT MOODY'S ANALYTICS.
WHILE EVERYONE IS TALKING ABOUT OPTIMISM, HE MUST BE FEELING
GOOD ABOUT THIS. LISTEN TO HIS TAKE.
>> I HAVE TO TELL YOU I AM GETTING MORE NERVOUS.
JUST TALKING TO FOLKS IN D.C. BOTH ON THE HILL AND IN THE
ADMINISTRATION IT FEELS LIKE THIS THING CAN REALLY GO OFF
THE RAILS PAIRED THE POLITICS ARE SO VEXED. JOE:
HE PUT THE ODDS OF A DEFAULT AT ONE IN FOUR.
HE SAID HE IS MORE NERVOUS TODAY THAN HE WAS A COUPLE DAYS
AGO. WERE WE SUPPOSED TO BELIEVE?
>> HIS JOB IS TO SUPER -- TO BE SUPER CAREFUL.
HE IS SUPPOSED TO SCREEN THE CREDIT OF EVERYONE.
HE IS SAYING WHAT WE HAVE BEEN THROUGH IN 2011.
WE SAW THE ALERT PUT OUT LAST NIGHT AS WELL.
JUST DOING THE DUE DILIGENCE. AGAIN, WHILE EVERYTHING IS BY
ALL ACCOUNTS THERE IS OPTIMISM, THIS IS A DIFFERENT WASHINGTON
THAN WHAT WE SAW IN 2011 THAT 2011 CREATURE HAS MANIFESTED
AND GROWN ITSELF OVER THE LAST DECADE PLUS TO WHAT WE HAVE
HERE PASSED THE TEA PARTY INTO THIS MAGA MOVEMENT WHERE THERE
IS A WING OF THE PARTY THAT WOULD NOT MIND OR IS NOT AFRAID
I SHOULD SAY OF DEFAULTING. ANNMARIE:
SOME DON'T EVEN BELIEVE WE WOULD THE FALL AND IT WOULD BE
THAT BAD.
SO IF WE WERE TO GET TO AN AGREEMENT WHICH WE BELIEVE
EVERYONE AT THEIR WORD THEY ARE GETTING CLOSER, TELL US HOW
DIFFICULT THIS IS GOING TO BE TO PASS AND HOW LONG WOULD IT
TAKE TO PASS THE HOUSE AND THE SENATE?
>> MCCARTHY AS PART OF HIS DEAL TO BECOME SPEAKER PROMISED HE
WOULD GIVE LAWMAKERS 72 HOURS TO READ LEGISLATION.
NOBODY ACTUALLY EVER READ LEGISLATION. JOE:
I'M SO LET DOWN.
>> SOMETHING THAT MCCARTHY HAS SAID TIME AND AGAIN HE WOULD
STICK TO. THAT IS THREE DAYS RIGHT THERE.
IF THEY GET A DEAL TOMORROW THEY STILL HAVE TO WRITE THE
LEGISLATION. THEN YOU'RE TALKING MAYBE A
TUESDAY VOTE IN THE HOUSE. THE SENATE WE HAVE ALREADY SEEN
AT LEAST ONE SENATOR FROM UTAH COME OUT AND SAY ABSOLUTELY NOT.
I'M GOING TO PUT THE BRAKES ON ANYTHING IT ONLY TAKES ONE
SENATOR TO -- THE WORKS OVER THERE.
IT ALREADY GETS US PASSED JUNE 1. PROBABLY WHAT WE ARE GOING TO
NEED IS THREE-DAY SUSPENSION TO THE DEBT CEILING.
THAT PASSES THE HOUSE AND THEN MCCARTHY, SENATOR MCCONNELL IS
GOING TO HAVE TO TRY TO DO SOME ARM TWISTING TO GET THE MIKE
LEE'S OF THE WORLD NOT TO OBJECT TO THAT SO THAT CAN PAST
BEFORE JUNE 1. THAT IS MY GUESS AT THIS POINT.
JOE: SOUNDS EASY TO ME. MAYBE NOT.
>> DEFINITELY NOT.