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global conference. this is about an hour. >> head of economics at bloomberg. ♪ >> comfy. >> welcome, everybody. you know all of the people. i won't waste the first 10 minutes doing introductions. but, clearly this is the topic of the day. we have an administration that has set out some very ambitious economic goals. recasting, rebalancing and global trading relationships and alliances, international alliances. shrinking the federal government

while extending and building on tax cuts, controlling immigration, deregulating finance, including -- whether and to what extent they are successful, the a ministry's and is successful in all of those goals, we can be confident they will leave a mark on the economy. i have an obvious opening question given the pool. what kind of u.s. economy, maybe not next week or next month, but what kind of u.s. economy emerges from this, from these policies? will it be more or less competitive and resilient than the u.s. economy that donald trump inherited at the start of the year? i'm asking for not a huge speech but for topline thoughts from everyone. and maybe a hint of particular

uncertainties or challenges that you personally are looking at. gary cohen? gary: we will come out of this just fine. take a reflection on that u.s. economy. we have lived through depressions, recessions, covid and the financial crisis. every time when we thought it was bad, it got a lot better. if you go 10 years forward or 20 years forward and you have any duration of time, this is an unbelievably resilient economy in the united states. we are the reserve currency in the world and we will stay the reserve currency of the world. we have a great corporate system that wants to invest in this country. we all have short-term concerns but long-term we should be excited with where we are going in this country. >> kevin mccarthy? kevin: to talk economics, you have to get in the brains of the president. he's different this time from

last time. he just texted me yesterday. trump is a populist. but there is two things that are principle to him and always have been. tariffs and drugs cost too much. when he says he's going to put a 10% tariff on, he will put a 10% tariff on. when he says it's 25 or higher, that's all about negotiations. we are in the middle of negotiations. he's also not a rigid person who will not adapt. if you take him exactly at what he's saying, you are going crazy. what's happening is at the end of the day, he's not going to have -- he knows he has 60 days to do something. i think we will be a lot better off. for the same reason we opened with china during the cold war, this will be a reset in china.

when we get an agreement with india, japan and the u.k., it will be more positive for america. is there adjustment and disruption? yes. but in the long run, it will make us stronger. >> peter? >> four quick points. on resilience, i think we will be more micro resilient and less macro resilient. by which i mean certain supply chains and pharma, etc., will be more secure. but from a macro perspective in terms of our ability to project power abroad and our ability to sustain the physical trajectory we are on -- second, we will have marginally higher manufacturing and activity but nothing like the 1950's shares of either the economy or employment. third, i think we need to be a bit careful about -- i saw simon

johnson in the hallway. a prize for -- a nobel prize for economics was awarded last year for what drives long-term growth. and rule of law, inclusive rather than extractive approaches to policymaking are all core to long-term economic growth. so, we just need to keep that in mind. the final point is despite all of the discussion about tariffs, text trump's tariffs. -- tech trumps tariffs. what is happening on the digital payment stack, what's happening on the ai race, what's happening in quantum, you might be hearing about some of that. that will turn out to be more important than the next two or three months. >> ruth, tech trumps tariffs. >> thank you for that set up. there is clearly another important factor to answer your

question about resilience. it's about this unique opportunity that we have. for historic context, i spoke to one of my colleagues. if you google him, you will find he's one of the fathers of the internet. i asked him to put the potential upside and downside risk opportunity with ai relative to the internet and he said there is a bigger opportunity. with agents, with generative ai, it has the ability to accentuate support and human capability in profound ways. we see more upsides from ai. the first is economic upside. we can add $4 trillion 2030 if we, the public and private sector, address it holistically and think about the implications for business and how to reach constituents, customers, drive more revenue and redo our internal processes. it's not a given but it's there. the second exciting building on

-- exciting thing, building on peter's point is the advancing science. predicting the protein structure for all proteins known to humanity, 200 million of them, it's the single biggest contribution to drug discovery in our lifetime. but that can do to incur cost while solving major disease issues for our country is extraordinary. we can do a better job delivering education, health care, cybersecurity. so, the answer to your question for me comes back to this one visual that i keep thinking of. which is how we would apply ai and google. for the last 20 years, we've been working on google translate. how many of you have actually used google translate? not as many as i thought. you have translated 250 languages. we added about 110 languages in the last two years.

when you chug along and hit ai, you hit an inflection point. that's what we can hit with one of our businesses or running city states and the country if we apply it and that would be the answer to the question, what will we look like in 2030 and hopefully we do embrace it robustly. >> governor? gov. youngkin: first of all, i'm optimistic about where president trump will lead this economy. i recognize that when you are fundamentally resetting trade relationships that are unbalanced around the world and, on top of that, bringing spending down dramatically in washington, where we have lost all semblance of fiscal discipline, there's a tough transition and that's real. the reality is between here and there, we will see trade deals and trade deals with some of our largest partners. we talked about india and europe and canada and mexico. and of course, korea and japan. and there will be a deal with china. i think president trump fully

recognizes that china is an adversary and not just a competitor. that is really important. the second thing is i expect that we will see a budget deal out of congress. we will get a budget deal. that will be really important. fast forward i think the ramifications of that will be, one, a lot of investment in the united states. we are seeing it in virginia. our economic pipeline is as full as it's ever been. a lot of them are international companies that are wanting to come to the united states. the second thing that we are going to see is we will see energy dominance. the united states will find a way to not only export our energy dominance, but the cost of energy and power will come down in the united states and we will be incredibly competitive. the third thing we will see as a result of that is jobs. i think this is a fundamental shift, where all of a sudden, we

will see a job market that will have multiple pathways. pathways for students who decide i don't want to go to college. i want to get a certificate. i want to get a credential and i will work and have a really, really good life and make a fair amount of money. but, i don't have to go borrow and then default on student loans. and i think this is going to be a fundamental shift in the competitiveness of the united states, where we no longer are dependent on supply chains from other countries in some of these key areas like pharmaceuticals and like semi conductors and like our advanced manufacturing. we will see in the united states , or with our trusted allies who hold us hostage when things don't go the way they want it to go. as a result, i think the unite states will be more dynamic and competitive. >> there were interesting points i want to get to from everybody. the long-term competitiveness is

often all about the micro. but, on this question of the trade wars, particularly with regard to china, i'm interested, governor, how if you were thinking about a path to seriously re-industrializing the u.s., which is a target of the administration, and decoupling, you would think given where we are now, you would build up gradually and offer certainty. and people would be able to plan on that path. it feels like the administration started off doing the opposite. when you look at your stint and how businesses are responding to this, how do we approach this the right way, even if you accept the goal? gov. youngkin: first of all, heavy transition or transformation isn't gradual. you've got to go. and anybody who runs a business knows that if you need to

transform the organization, you can't to veto your way along the way, otherwise it will never happen. there is so much resistance. in the world of government, there's a lot of resistance. so, you've got to go. in this case, what we are seeing in virginia is massive interest in coming to the united states and building and invest. we have had over $100 of commitments in companies to expand or build in virginia, which is more than the last two administrations combined. you couple that with the fact that his this is dynamic. you figure it out. our port, which is the most efficient operating port in north america recently is one of our biggest assets. 20% of the volume comes from china. we watched the chinese volume. guess what? we have opened up trade lanes with many of the countries immediately. small businesses are going to figure it out. we have seen supply arrangements change.

you are watching other countries step in. there's lots of supply chains that are hard to move. but, they will move. and we will end up with a transformed supply chain arrangement where we will see trusted allies or, in the united states, take the place of what's been coming from china. that's what president trump will negotiate. i don't think we will worry about who makes t-shirts. we are going to worry about who makes the active pharmaceutical ingredients in our pharmaceuticals. we are not going to worry about low value add. we are going to worry about who's going to making the design tools that show up in every piece of advanced manufacturing. really important. we will have steel smelters back in the united states. we are seeing one built into louisiana. -- in louisiana. it will take a little bit of time and there will be a little bit of disruption if not a lot in some places. this will happen.

but you have to get going because if you don't, it will never happen. >> whether it's ibm or anywhere else, can you respond to this changing incentives and support the kind of investments that the administration wants to see when you have zero clarity about what the tariffs rates are going to be and what the futures are going to be? >> i think all of us run big companies and have run big companies. we have to think long term. we are thinking about the next 90 days because we have to book honestly we are making investments for a generational cycle. everyone is talking about ai today. a lot of the investment that you are seeing in ai today didn't happen in the last two, three or four years. the amount of money that ibm and others are putting into quantum today is extraordinary. quantum will pay results five years from now. we are making extraordinary

investments in this country and in this economy. the one place i will caution because i think we need to talk about this to some extent. tax policy drives investment decisions in this country. if you want to boil it down to any one major factor that drives decision-making in this country, it is tax policy. we changed our taxes in 2017, we affected corporate policy more than anything else that has happened in this country in the last 30 or 40 years. we forced a lot of this money back. when we changed the corporate tax rate, and became competitive with the oa cd, we change the way people thought about manufacturing and building businesses in the united states. all of these things matter. they will drive policy more than anything else that we are talking about. because at the end of the day, when you are running big companies, you are trying to maximize your turnover over a long period of time and taxes will drive a lot of those decisions.

one of the most important things that has to happen this year is we have to, at a minimum, extend the trump tax cuts. that to me is a minimum. if we can put something additional in there, great. bringing back credits. that will have more impact than anything we are talking about. >> do you agree? >> no. taxes matter but it's not even close to the most important factor. a lot of things go into the future cash flows and expectations of future cash flows. part of which is taxes but there are lots of other pieces that are more important. on that point, i think we need to also highlight that a lot of the benefits that we have experienced historically in the united states comes from being the world leader in technology

in particular. that is where a disproportionate share of productivity growth has occurred. that is where there are differences with your. that's where the differences have shown up most prominently. and we need to be cognizant of that. there is some risk that we will disrupt the apple card. i completely -- apple cart. i completely empathize with the perspectives when the universities went far offkilter in how they handled the aftermath of october 7 in particular read but i think slashing -- particular. but i think slashing funding to the leading universities of the united states risks what we are seeing, which is europeans and others are saying come here. we will invest in science. we don't want that. that is just as important, if not more important than tax policy. obviously, everything matters. >> ruth?

do you agree with that? ruth: there was so much in that. yes, i do agree that one of the most important elements is to have a pro investment, pro-innovation. >> but also, pro-research. >> the reality is my father was a physicist. he helped design the adam smasher. in those days, the public sector was funding all of research. what we have now is the private sector is funding the leadership position we have in science, whether it's in ai or, i completely agree with gary, quantum. economic strength is national security strength. that is driven by tech strength. 80% of growth in our country for the last 80 years is attributable to technology. i think we need to continue -- make sure that we continue to have the right conditions for investing in this country. it's not just about economic strength in the u.s.

when i traveled the globe, i hear we want to be part of the turtle -- digital transformation. we will be part of the digital transformation. but if you are not here, if you are not in this position and you have limitations and can't engage with us, there's another alternative. that means that we are seating an entire ecosystem and all that comes with that to china. i think it's imperative that we have the right framework to support private sector and global engagement. >> since we have gone on to ai and technology, what outcomes were you hoping for the chips act and was it successful in vitalizing u.s. microchip manufacturing? you were speaker when the bipartisan microchip act was passed. there have been different

signals around it but was it successful in doing what it was supposed to do? >> no. the company that the government invested in the most i don't know is going to make it all the way. ai is going to do one thing for america. it's going to get our energy policy right. we will never capture ai without getting energy policy right. getting chips made in america is going to be an agreement with government in taiwan. taiwan is never going to give the full -- here unless they get an agreement that they will get some type of support. that's happening now. i believe there's enough capital out there. it's more a government view that, in the senate, if they throat money, there's a lot of capital in the free money -- free market to get money for chips. the question to the governor was correct.

this isn't normal. i tell my friends in congress, china has a congress too and nobody knows who they are. trump has one term. you can tell him if it went really smooth, none of that will matter to him. he has one term to get something done read he knows how to do the -- something done. he knows how to do the job. he picked the cabinet that he wants. he feels last time that he got told no at different parts. he has to be a disruption. you had to come in with elon musk. there is no way members of congress will sit there and go you can systematically do that. there is no way that congress will say let's make this trade agreement. you have to knock things off the shelf. to be respect oh, i believe investment is important.

-- respect oh, i believe investment is important. -- respectful, i believe investment is important. did you really think the government should give harvard $9 billion? i think coming after it will make every single college start auditing what are we doing with this one a? and it will -- >> i 100% agree that we will find that waste is so overwhelmingly big that we can cut waste and put more lead on target. that will be the big aha surprised in all of this when it comes to medicaid. the fraud and abuse in medicaid is somewhere up to 15 to 30% of the medicaid spending. overhead weights can get it done

for a lot less. this is what we are forcing and this is what we are seeing today in america. the bright light and the exact same thing happens, when organizations go sideways. you have to reset them and you have to do it quickly. and then we will see a period of real growth. i think that is why i started with why i'm optimistic. i think that we will in fact lead the world in ai development, because we will lead the world in investing in the best way possible, because private sector will in fact draw in capital to the best ideas. and i totally agree, we will crack the energy code. we will be -- it will be the first time that small modular reactors are absolutely the baseload power along with some big ones. but, we will become the nation that will be far better known as reliable, affordable and, by

definition, increasingly clean because nuclear will be a much bigger part of everything we do. by the way, we have to engage with gas power. we have to engage with everything because we have a massive power deficit in this country. i think the aspiration to be energy dominant is not just an aspiration, but we can be and must be, so that we can have power in order to drive this next evolution of innovation in america and the world. and i fully expect us to do that. >> governor, i think you are doing your fair bit. you have your data storage capital of the world -- you are the data storage capital of the world at this point? gov. youngkin: i will sell a little bit on virginia because on the governor. [laughter] ruth, in case you have not heard. >> we are there. gov. youngkin: virginia is the largest data center market in the world by a factor of four.

it's that ecosystem which draws in more investment because people want to be part of it. we have all of the supply chains for servers and cooling systems. we have a very pro-data center regulatory framework. by the way, we are really cracking the code on power. and i launched two years ago, all american and all of the above powerplant. i said we will be the first ones to have a small modular reactor that will be commercially deployed. we are working with other states to see who can get there first. we are going to do everything we can to get there. i think if virginia wins this, we can in fact not just lead from a commercial standpoint, but we can crack a national security need in this country as well. that's why i'm so passionate. we have to crack the code here. and there's plenty of money. there is trillions of dollars in the system to do this. yes, there will be some government assistance. the vast majority of the capital will come from the private

sector. because the private sector is replacing the federal government in driving r&d, in driving capacity expansion and most importantly pulling forward timelines on the timeline of business. >> i was blowing your horn so you wouldn't have to. >> i very much agree that we have to unlock the power to deliver ai. we published a paper on this last week. there has been a broad body of work and it's great to hear what's being said on this panel. we need to come together and landed some of the solutions. we have a set of 15 recommendations pulled out of the work that's been done over many years that has the most broad-based support and it falls into three areas. number one, to the governor's point, we have to unlock more innovation in advanced energy solutions, in particular in nuclear. china has three gigawatts of

nuclear already in construction. they have 200 gigawatts right behind that. the u.s. isn't doing anything. this is what will let them continue to unlock the upside from ai. there is a lot that can be done that's been close to the finish line but stuck on the one yard line. second is around the grid. something the governor has spoken about. as a nation, we have under invested in the grid. the department of energy said we have the ability to unlock 100 gigawatts of capacity in the grid by optimizing and upgrading the grid. again, as an example, 's to towers. you can double capacity at 25% of the cost. -- applied ai to the ability to simulate optimized what is happening in that important grid. a host of solutions. the final area building on the

governor's comments, this leads to jobs. there is a shortage of electrical workers in our country and we need job training for electrical workers. google has done a lot of work on digital skills training. we know how to design programs. we have partnered up with best in class for content. it is not the solution for the country but we hope it points the way to others joining in. we have to unlock this because if we don't and we see the speed with which china is engaging, it is the foundation. we will say, how does that happen? but we can see it. i look forward to seeing the progress. >> i think the most bipartisan thing that will happen is permitting reform. it does not matter where you sit on the energy spectrum. nobody can build. we have so much backlog. this is where you get frustrated

with trump, this is what you will love about him. you could double the grid right now. he will change anyone appointed on there. i firmly believe in the tax bill. it will get done but it will not get done perfectly on the timeline congress has right now. there is too much pain if they did not do it. but, trump will cut regulation -- he did last time, even faster than reagan. that combination will help energy more and ai will drive energy to do it more than anything. >> look, i think there is a very positive agenda here that has to do with expanding the supply not only of energy where, honestly, the myth of a macula transition has dominated for too long and i'm glad we are past that. housing, which is admittedly local but a huge impediment to

the upward mobility of many families. by the way, people have not realized but mobility rates in the u.s. have been declining over the past two to three decades. part of that is the lock-in effects and the difficulty of finding housing wherever you want to move to. this is a problem that needs to be addressed. you can go down the list of expanding supply. there is a book written fundamentally about let's stop subsidizing demand and really focus on expanding supply. that is an agenda item 100% behind. >> i wanted to shift a little bit on what follows from that. if you have a supply-side approach one thing investors were excited about in looking at this incoming administration was around deregulation and that whole agenda.

. we also saw in the previous administration quite an aggressive approach to corporate power which was associated with an analysis of noncompete clauses. corporate concentration itself was impeding economic competitiveness. how would you judge where the administration is on that and whether it is right to be more relaxed about corporate concentration at that is the case? >> the frustration i have had with past administrations, if one administration does something the other has to be opposed to it. >> except when it comes to china. >> china has united everyone. i created this select committee on china and i got the idea standing next to nancy pelosi at the 75th anniversary of normandy, looking at the graves and asking what the policymakers could have done and that would not have happened. how many of you have read "de

stined for war?" 16 times in history the number two pastor number one. i want to treat you the way i wanted to be treated. i will tell you every single person i will appoint to the select committee on china. before i tell my own members. we did it together. it is not about preparing for war. we have become too dependent. this is about making sure we do not go to work. when the president of taiwan came to see me i held the meeting at the reagan library for the symbolism of the feeding communists without going to work. andrea mitchell give the first question. she said i cried and i was with reagan and said tear down the wall, i feel just as emotional today that you are so united without politics.

independency, they control 90% of the critical minerals and 95% of the processing. will congress allow us if we have our own resources to do that? this is where the tiktok ban came from. >> what happened to that? [laughter] >> i did actually distract you. do you want to take on the antitrust question? >> i'm always troubled by this topic to some degree. we clearly want our companies to play within the rules. we do not want anyone to have an unfair advantage. on the flipside we sit here and talk about we have to compete against china, which we do. china is trying to build the largest companies in the world to take over the world. we are trying to break up the largest companies that are successful in the u.s. we have to decide which side of the equation we want to come out on.

we want to compete globally. if some of our companies are really successful and happen to be very large, it is ok. it is probably good for us in this country. they bring home tax revenue and employ a lot of people. as long as they are not prohibiting from other people competing in the space, we should be very prideful in the fact we can build these companies from nothing. the companies we are talking about -- companies did not exist 30, 40, 50 years ago. you think about the creativity -- this is where it started out so bullish on the economy -- you think of the creativity and entrepreneurial spirit in this country, we have built some of the largest companies in the last 20 years. let's allow them to thrive as long as they are playing within the laws. >> the biggest divergence that the biggest bad crowd has was --

it is easy to say it is across the board -- it is quite specifically with vertical integration. a firm that is buying something that is a supplier or a distributor as opposed to merging horizontally. there, honestly, there was a lot of rhetoric without a lot of evidence. you will find, i believe, the new administration to be the most significant, a little bit of backing off from the all vertical integration that is bad. let me highlight one area where this tension is paramount. i saw dr. oz yesterday, he is here. i believe cms under dr. oz will push hard on value-based health care which is fantastic. we should pay for value and not quantity. as you do that you are creating incentives for insurance companies and providers to act as one because that is

effectively what the incentive under value-based care does. in california, kaiser permanente is a good example, fully integrated health care players that perform better than others. if you go after vertical integration and also one value-based health care, which by the way the prior administration was saying simultaneously, you you have massive cognitive dissidents. that would be better going forward. >> you are sitting in a place that has not received the benefit of this change. is there a consistent message coming from the administration? do you understand the approach to competition? >> it is gratifying to hear this is the golden era of innovation because we believe it is the golden era of innovation. the opportunity for this country

is great for all the reasons we discussed on this panel. we think the doj approach in thesis is flawed and we will appeal. as gary said, ai did not just happen. we have been investing aggressively, meaningfully for over a decade. we are helping to set up the country to have an important victory with quantum, as is ibm and others. it will be critical for the future of biology, material science. it is a critical asset. google was not the first search engine. we were the eighth search engine. i remember when all the sudden google pops up. why do we need an eighth search engine? from inception it was about creating a radically better experience for users on that has been the guiding principle. we have publicly said we are investing $75 billion in in 2025.

let us not include the r&d investments. we do not suspect we would be able to do that if the doj recommendation is followed. what does that mean. how do you think that with the golden era of innovation? what we are doing is telling the legal team that you go deal with that. we will tell all the engineers, do what you do and do it well. focus on users, solutions, continuing to deliver for the communities in which we operate in the u.s. and around the globe and we will see where this ends of going. >> i will change the subject. i did mention at the start one of the things economists had been concerned about given how much it had been part of the growth model in the last few years was the much tougher stance toward immigration of this administration. obviously the focus has been illegal immigration and

companies do not tend to stand up for the right to have loads of illegal immigrants working for them. governor youngkin, do you worry you might be in the wrong part of the country but do you worry about short-term impact of employers of a chilling effect on immigration? >> we first have to start with the reality that there was an invasion and we ended up with an uncountable number of illegal immigrants who were violent criminals. that is the first step. we have to deal with it. that is why i was so pleased to be able to partner with the trump administration and go to work. we signed an agreement, a memorandum, with homeland security and the fbi, the dea and we went to work with state police. we have had eight weeks straight of targeted efforts in order to arrest really violent criminals

who were here illegally and we are now cresting over 750 arrests. terrorist gang members. we have to go here because they are living among us. >> the have been proven in court to be terrorists and criminals? >> what they have proven is, one, they have real proof they are involved in illegal activity that involves either drug trafficking, human trafficking, membership of ms 13 and are tied into violent activity in communities. that is where we start. in fact, this is a normal law enforcement practice, folks. you arrest someone and then all

the sudden you can unpick their connectivity to the entire distribution system and slowly undo it. we have to do this. it is predominantly run by people who are here illegally. should not be here. they are engaged in violent crime. we must do this. that is where this has to start. i must say the anecdotes of one thing because they are real. the heart of the matter is the vast number of violent criminals who are here illegally that need to be arrested and need to be dealt with. >> those cases, there have been a lot of reporting -- i want to get past that and to the core of what has been a source of economic strength for the u.s. in recent years which has been an opening environment -- >> for legal immigration. >> foreign citizens.

we have foreign students studying here, maybe contributing to entrepreneurship and inventions in the u.s. down the road, they are being intimidated. we know people here who have been told if you do not need to come to the u.s., do not come or take a burner phone. i am sure some of this is exaggerated by the atmosphere and creates but is trying to attract foreign talent. >> there is not a shortage of extraordinary talent that wants to come to the united states. they are lining up to come into the united states and study at our universities and engage in discovery and be part of the tax system -- tech system and all that comes with it. that is legal immigration and we

need it. >> i agree that we need to have secure borders and i agree that no one can or should be in favor of illegal immigration. let me just say that. however, even if the burner phone phenomenon is anecdotal, anecdotes can become the telephone game and affect our ability to attract top talent. the number of foreign ceos with whom i have spoken that said they will bring a burner phone to the u.s. is much higher than it should be. i hope whatever is causing that change is because that is not good for our economy. >> does the tone of what has happened over the last few months and a beauty overreached by some people and individual bits of homeland security which then contributes to the stories.

>> i think the greatest strength of america is not the aircraft carrier, it is the idea of america. president trump got elected on two main factors -- the border and the economy. 80% of america believes the border is out of control. you have to make this statement to stop the illegal from coming. we are the most generous nation in the world. now you will get a gold card. this is a small part. i think it will make people rethink. i am more concerned about the relationship with canada and mexico. that is a great deal of strength. we have an agreement with them and we need to work through it. you cannot work with your neighbors that you have an agreement with, it is hard to make agreements with other people. >> we started at the beginning,

you talked about debt and the importance of making the tax cuts permanent. just doing a classic economic health check of the u.s., you would say that is the scariest chart, what happens to debt under any reasonable assumptions. do you see a path, given the relatively modest gains of doge, given the cuts on the table in congress, do you see a path to meaningfully flattening the u.s. debt trajectory? >> there is always a path. do we want to take the path? we will have no choice. we will have to get to the point where we take the path. if you look at what doge is trying to do with waste, fraud and abuse, there is waste, fraud and abuse everywhere. i actually think we would be

better off to take a step back and figure out, what can we eliminate. it is a lot more cost-effective to start limiting things. when you look at the banking sector in the united states, we have 8-11 regulators in the banking sector in the united states. when you look at the u.k., hong kong, japan, singapore, they have pretty good markets in a pretty good banking sector. they have a maximum of three regulators. they do not have an sec, i can keep naming things they do not have. they have a regulator and a central bank and a regulator that protects the public. we can do that really efficiently in this country. we can cut out real spending long-term. getting rid of a bunch of these agencies but these agencies have

probably outlive their needs and their services. if we are going to get serious about taking money out and keeping it out because the doge money, i hate to say it, in the next administration it could come back in, the way to take it out and keep it out is to remove the part of the organization that does not need to be there today. >> if i told all of you that there was a country running 7% of gdp deficits as far as i can see, that the debt to gdp ratio of the country is 100%, that the political system was deeply polarized, that the country was arguably alienating 1/3 of its investor class and that country was also toying with the idea of whether the central bank should remain fully independent or not, that would not be a combination

of factors that would be confidence inspiring. i agree with gary. even i as a former director tuned out all of the chicken little, the sky is falling physical stuff. all of the dire predictions were not happening and it got tiresome to keep hearing them. if you compare where we are now to where we were a decade ago it is a lot different. the deficit is twice as high, interest rates are high. i am pleased secretary bessette this morning has cleaned up the question of whether the administration is doubting, whether it being a reserve currency is a benefit or not, i think there were statements from other officials that were not helpful. that is a dangerous thing to be doing. it is time to worry again about

this trajectory. i hope we get serious about what we are going to do. you do not want to be in a situation where it gets away from you. i think the risk that it gets away from us is higher now than it was over the past decade. >> it is all down to your colleagues. >> then i would be really worried. [laughter] >> structure dictates behavior. there is not one person that gets elected that they will go in and cut. it does not show up in any pole. we have the same problem in 1990 with the collapse of the soviet union. there is not one member of congress that will raise their hand, we spent the last 40 years developing a military to fight the soviet union that will raise their hand and say close my base. they created base realignment and closure. every leader got to point to it. if they came up with a plan, this is all they were promised.

they would get a vote on the floor in the house and no amendments. it would pass and it would be bipartisan. then you are boston. i made this offer to biden during the debt. let's do it and let's vote after the election. you have a tax bill and a provision coming due. technically, in the tax bill you are raising taxes, you are decreasing them. an obamacare some provisions were leaving. if you reform that from a democrat, you are destroying obamacare. if you did it after the election you got a little lame duck, the greater strength any politician has is the first day they are elected and it goes down each day. if you did it together, no one would lose their job over it. you can eliminate things in government. that will not do anything for

you. the drivers today are the government programs. if you do nothing, eight years and nine years, they will automatically be double digit cuts and a few options. it is the greatest threat we have. >> help me out here. when you look at the only serious cut in a nondiscretionary program that is on the table that is gaining momentum in congress, it is medicaid. the president has said multiple times he does not want to see those cuts. without that cut it is hard to see how you start to pay for the tax cuts. given your history and your experience, how do you think that will be resolved? >> my experience, in the debt ceiling i cut $2 trillion and i lost my job over it. in this reconciliation they are not coming anywhere near it and it is a republican white house, republican senate and house.

it will become such a big problem that nobody can ignore it but you have to change the structure otherwise the members -- the minority will fight whoever is in the majority, take it out of the argument and bring it back in one vote and that is the way you have to get it done. you have to be able to change eligibility. the f map, when we created medicaid you had to be pregnant or disabled and we would pay 50%. we still do that only 50%. if you go on obamacare, the federal government pays you 90%. why wouldn't these governor signed everybody up? you will go broke during that. >> you are lucky you do not have to think about u.s. federal debt that much. i just wonder -- the conclusion from this, pretty unlikely to put it on a sustainable path.

it is a fundamental problem everyone agrees on that is not being resolved by the political process. if you are thinking about it as the leader of a major global corporation, how much does that undermine u.s. authority in the world if there is not clarity on an ability to resolve that? >> i thought we were going to take it a different direction and i will answer your question. the first part of it is, ima tech optimist -- i am a tech optimist. we believe the problems are solvable. one thing i am very focused on is, one of the reasons we see this polarization in the united states -- are there ways technology in communities that have legitimately been left

behind. whether it is the application of health care so you can get early diagnosis and have your child taken care of the right way, or in education or in infrastructure, one thing we can do where people can say government is working for me. in new york state, we were brought in because there was an 18 month queue on service delivery. with ai we were able to compress it to a couple of weeks. if the government is not working for you you will see the frustration and this inability to get anything done. i am hopeful that we are doing some work with the governor and be able to land some things that actually show we can make progress and hopefully it is not quite as bad as he is saying in terms of landing a reasonable budget. in terms of the rest of the world, we are concerned. the conversations are, we believe in the outside from technology.

china is not far behind. at this point the u.s. is in the lead on ships, frontier models and we have set for quite some time the gap is narrowing. with deepseek and with the operating system, harmony, what you are seeing with data points like number of graduates in computer science, publications, the gap is narrowing. there is still very clearly a desire to work with u.s. companies in the values we represent. we just cannot take that for granted. there does become a tipping point where it becomes challenging. i do not think we are anywhere near that. having the privilege of working with him during the financial crisis he said you have to have the will and the means. too often by the time you have the will to do the right thing you no longer have the means. we need to be ahead of this. right now, getting everything landed as quickly as possible, as effectively as possible so we

can move on is an investment in the future of our children. >> the one thing we have not talked about his growth. at the end of the day, growth matters. we need a lot more people working in five years, in 10 years than we have today. just to lay out a couple numbers, we have 7 million jobs in the united states that sit empty. they are available, people can take them and they are empty. if you take today, men and women between the ages of 16 and 65, the numbers of them sitting on the sidelines, who otherwise could be working -- if just a percentage of them was working today that we had back in the year 2000, it is another 5.5 million people working. this is the key. this is why, candidly, you can

take this to a state-by-state basis and see the difference. most states have balanced budgets. we do not get to run big deficits. how do you create space? you either grow or you shrink and cut -- or shrink and tax. and that is the truth. in virginia -- virginia was stagnant and we came in and absolutely energized it. we have had records job growth, record investment. and by the way, we have had $9 billion of tax relief and record budgets and we are getting ready to run our fourth straight surplus. the key to this is growth. you have to turn on real growth and that means we have to get jobs, that is investment, new jobs, a pathway for people to get there. we have to get people off the sidelines and to work. america today as a 63% labor

participation. 63%. everyone talks about unemployment. this is the most important number. how many eligible working adults are actually in the labor force. that number used to be 60 5%, 66%, 67%. when you begin to think about what 1, 2, 3 percentage paying taxes and having purpose and dignity in life. it changes everything. yes, we have to rein in spending. we also have to get growth. that's why i am optimistic. i believe the investments coming into america to reestablish manufacturing and not, again, low-level manufacturing. high value-added manufacturing. the technology leadership we will have and everything that comes with it will be a job

creating engine we have not seen in a long time. >> that is the kind of grassroots enthusiasm and optimism from the states we might as well and on. thank you very much. >> i happened to listen to him. he was on c-span1. that's a big upgrade, right? >> i have read in the history books. i have seen the c-span footage. >> if it is a good idea present it in public view on c-span. >> every time i tuned in on tiktok, c-span, or youtube there were tens if not hundreds of thousand people watching. >> i went home after the speech and turned on c-span. >> i was on c-span just this

week. >> to the american people, now is the time to tune into c-span. what they had $2.50 per gallon i saw it on television a little while ago. in between watching my great friends on c-span. >> c-span is televising this now live. we aren't just speaking to los angeles, we are speaking to the country. sunday night on c-span's q and a. a former ohio governor john kasich author of "heaven help us" talks about the work done by religious institutions and people of faith in the united states including combating homelessness, hunger, human trafficking and other issues. >> it's not critical to count the number of times you go to church. at the same time, we need to realize those institutions are

sort of like when you think about running for office you need a clubhouse. you need a political club to gather. i look at the opportunity -- the church as an opportunity for people to go in there and be able to find some material support, some psychological support. i believe you can get more done working with others than just working alone. >> john kasich with his book heaven help us. listen to q and a of our podcasts and -- on the c-span now app or wherever you get your podcasts. c-span. democracy unfiltered funded by these television companies and more including buckeye broadband.

buckeye badband supports c-span as a public service along with these other television providers giving you a front row seat to democracy. >> following its policy meeting federal reserve church jerome powell announced the central bank would leave interest rates unchanged, rolling out preemptive rate cuts amid potential tariff effects. this is about 50 minutes. because they could have simply -- sec. powell: good afternoon. my colleagues and i remained squarely focused on our dual mandate goals of maximum employment and stable