On today's show, Jake and Steve discuss the latest in the Diddy case, the Supreme Court's decision on the D.O.J. v. Carter case, and the fallout from the failure of the Budget Bill.
00:03:26.860They're going to expedite work requirements.
00:03:28.620They're going to they're asking for deeper cuts into the IRA, the Inflation Reduction Act, which was passed under under Joe Biden and is popular with some Republicans around the country.
00:03:39.660This is a huge deal because I've wondered on your air and in our newsletter whether there is a sweet spot between the hardline right and the middle of the conference.
00:03:51.460And and right now, I don't know the answer to that.
00:03:54.200I still think they find a way to get it done.
00:03:56.680The budget committee and we just broke this news is going to reconvene Sunday night at 10 p.m.
00:04:03.560That is an order to kind of get the week started early so they can go to the rules committee if they have a deal and get it to the floor later in that week.
00:04:10.920But this is just it reminds me, I think I said this a couple of days ago to you, Katie.
00:04:15.620It reminds me of the Build Back Better bill.
00:04:18.180Too big, too many things going on, too much for Congress to to to swallow.
00:04:24.420And again, these are this is like a tough vote for moderates.
00:04:27.500This is taking away things from a lot of people.
00:04:32.480It's just not great politics for a huge swath of the Republican conference.
00:04:35.800Can I just linger on one thing you said a moment ago?
00:04:38.020They want to cut more from the Inflation Reduction Act, which is what came out of the Build Back Better bill.
00:04:44.760It was a lot of money, a lot of money for some big initiatives.
00:04:48.920Why are some Republicans against cutting that?
00:04:52.240What what happened or what did they get out of this bill?
00:04:54.420I seem to remember moments where Republicans who voted against it went back home and touted projects that were funded by this bill as if they voted yes for them.
00:05:07.340These projects are up and running in their districts.
00:05:10.620Companies have made investments around the country based off tax credits and other policy provisions that are that, you know, are still in law and they don't want to gut them.
00:05:20.400I mean, it's as simple as that, Katie.
00:05:21.720And, you know, right now, these tax credits phase out over over a period of time.
00:05:27.620They would like them to stop today, you know, or whenever the bill is passed.
00:05:35.020And by the way, I'll say this again, and I sound like a broken record.
00:05:38.540The Senate still has to deal with this bill and it gets more complicated for the hardliners when it gets to the Senate because a state like West Virginia, which has 700000 people on Medicaid and has a lot, thanks to Joe Manchin, of IRA money around the state.
00:05:54.940It's going to be very difficult to do the things that these conservatives over here in the House want to do when it gets to the Senate, when you have, you know, more complicated political calculuses.
00:06:06.300We do have breaking news from the Supreme Court as we come on the air.
00:06:10.820The justices weighing in on President Trump's use of the Alien Enemies Act.
00:06:16.820Let's get straight to CNN chief legal affairs correspondent Paula Reid.
00:06:23.160So, Casey, this is a loss for President Trump, but this is not the final word.
00:06:26.660We know that he wants to speed up deportations.
00:06:30.080And as part of that plan, he has invoked the Aliens Enemies Act, which allows him to proceed with deportations with less review than he would otherwise.
00:06:38.620Of course, this is set off litigation across the country.
00:06:41.700And here today, the Supreme Court has blocked the president from moving forward with deportations under this act for a group of immigrants in northern Texas.
00:06:49.960So he's siding with a group of Venezuelans in Texas who were worried that they were going to be imminently removed under this authority.
00:06:57.780So he's taking this issue and he's sending it back down to the Fifth Circuit Court of Appeals to decide certain questions, important questions here,
00:07:05.280particularly about how much notice these individuals received in terms of the process that they are due.
00:07:11.040This is one of the issues that has come up in a lot of these cases.
00:07:14.300Now, while this is, again, a significant loss for the president, this is temporary.
00:07:18.120And this underlying legal fight continues to play out across the country.
00:07:25.280This is the primal scream of a dying regime.
00:07:30.220Pray for our enemies, because we're going medieval on these people.
00:07:35.440I got a free shot at all these networks lying about the people.
00:07:39.700The people have had a belly full of it.
00:08:30.240The bond market is going to get a vote here.
00:08:31.800Moody's rating slashed the United States credit rating down a notch on Friday, citing the budgetary burden the government faces amid higher interest rates.
00:08:40.580This one-notch downgrading reflects the increase over more than a decade in government debt, interest payment ratios to levels that are significantly higher than similarly rated sovereigns.
00:08:49.640The rating said, the U.S., I continue to quote, the U.S. is running a massive budget deficit as interest costs for treasury debt continue to rise due to a combination of higher interest rates and more debt to finance.
00:09:14.620We're going to get more of that later in the show.
00:09:16.140Moody's up on a Friday, Friday afternoon dumps.
00:09:21.520Now you've got a credit rating downgrade, which means you're going to pay higher interest rates in these government bonds that you're going to have to sell.
00:09:28.180This is why this is initially linked with why the conservatives said we've got to get our arms around this budget crisis.
00:09:37.120Mike Davis, what in the hell is going over in the Supreme Court?
00:09:41.340The Supreme Court is doing a supreme punt with this Trende Aragua case.
00:09:49.460Remember, four weeks ago on Good Friday, the Supreme Court illegally, unconstitutionally issued an injunction against the President of the United States as he's commanding military operations to expel foreign terrorists working with foreign governments.
00:10:09.060Trende Aragua working with Venezuela along with MS-13 gangbangers and the Supreme Court issued an illegal injunction against the President of the United States without a district court ruling, without 85th Circuit appellate court ruling, without even a solicitor general brief.
00:10:27.520And if you read this muddled mess of a decision from the Supreme Court today in this seven to two decision with all three Trump justices joining the three liberal women, along with the chief justice, so the four liberal women, you see that they're learning the hard way that being generals, moonlighting as generals is hard work.
00:10:52.960With commanding general, John Roberts and his six lieutenant generals, they're learning the hard way that legislates the bench is hard work.
00:11:01.480Slow down. Slow down. We had Alito. He told me we have Alito and Thomas, right? We had the two good guys. Everybody else voted seven to two. This is not a close one, Viceroy, sir.
00:11:12.520Well, it's not a close one, but if you actually look at what they did, it is a punt. Let me read you from Justice Kavanaugh's concurrence, because this is important. This is what you call a supreme punt.
00:11:26.360I understand and agree with the court's decision to grant a temporary injunction. The injunction simply ensures that the judiciary can decide whether these Venezuelan detainees may be lawfully removed under the Alien Enemies Act before they are in fact removed.
00:11:46.220The underlying legal questions that the courts may need to decide before the removals occur include, number one, whether the Alien Enemies Act, as distinct from the ordinary removal process under the Immigration and Nationality Act, authorizes removal of these detainees.
00:12:04.760And number two, if so, what notice is due before removal? That's from the concurrence in the seven to two ruling. And the majority goes out of its way to say the government may remove the named plaintiffs or putative class members under other lawful authorities, right?
00:12:24.620They are trying to get out of this case. They sent it down to the Fifth Circuit for the Fifth Circuit to decide these issues. Instead of just deciding it themselves, that got Justice Kavanaugh's criticism.
00:12:38.280They are trying to get out of this case as quickly as they can. So this is going to go down to the Fifth Circuit for the Fifth Circuit to figure out whether Trump can boot these trendy Aragua terrorists under the Alien Enemies Act, which they clearly can.
00:12:54.620And then number two, how much notice is due? Can he do it in 24 hours? Or does the Supreme Court, they need to take off their general uniforms and put on their senator suits and figure out how they're going to rewrite the Alien Enemies Act from the bench?
00:13:13.820Is it going to be three days, 21 days? At the end of the day, the Supreme Court's going to punt on this.
00:13:19.780What do you mean? Should Trump continue to send people out of the country? Or is this freeze means he's going to stop and go full stop until this goes back to the Fifth Circuit and works his way back up?
00:13:33.620In other words, we're not going to be shipping any bad guys out of here?
00:13:35.760No, you can't. What it means is that Trump can't expel foreign terrorists who have invaded our country under the Alien Enemies Act somehow until the Fifth Circuit decides this on an expedited basis.
00:13:49.320And then the seven ladies on the Supreme Court take off their general uniforms, put away their legislative pens and put on their big boy pants and actually decide this case on the merits.
00:14:00.960I know that, you know, being a general is tough, being a legislator is tough, but maybe they can just go back to old-fashioned judging and do their job and get this resolved.
00:14:11.640They should have done it now, but they don't have the courage to do it now.
00:14:14.780They want to punt to the Fifth Circuit so the Fifth Circuit can do their dirty work.
00:14:19.280I imagine the Fifth Circuit's going to say, OK, our seven ladies, our seven women bosses on the Supreme Court think we need to have notice here.
00:14:28.180So they're going to come up with an arbitrary number, three days, seven days, 14 days, 21 days, however many days it takes to get five votes on the Supreme Court from the seven women, and then that's going to resolve this case.
00:14:44.000Hang on one second, Kenyon. I know you got a punt, but I just need to hold you briefly on the side.
00:14:48.940Two blockbusters, a downgrade to U.S. debt, and the Supreme Court blocking the commander-in-chief all on a Friday afternoon in May.
00:14:58.180This July, there is a global summit of BRICS nations in Rio de Janeiro, the bloc of emerging superpowers, including China, Russia, India, and Persia,
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00:15:18.860As BRICS nations push forward with their plans, global demand for U.S. dollars will decrease, bringing down the value of the dollar in your savings.
00:15:26.540While this transition won't not happen overnight, but trust me, it's going to start in Rio.
00:15:33.440The Rio Reset in July marks a pivotal moment when BRICS objectives move decisively from a theoretical possibility towards an inevitable reality.
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00:17:04.200D.C. Drainer and I have laid out President Lincoln's thing.
00:17:06.560Are you coming more my way on let's just suspend the writ of habeas corpus and get on with it, sir?
00:17:11.860Well, I'll tell you what I think is going to happen in this case.
00:17:14.760Because the seven ladies on the Supreme Court didn't have the courage to decide the merits of the Alien Enemies Act.
00:17:23.200So they punted it down to the adults on the Fifth Circuit.
00:17:26.880You're going to have the adults on the Fifth Circuit, based in Texas, make a ruling that, yes, the president can use the Alien Enemies Act to expel these designated foreign terrorists.
00:17:38.940Trendy Iraq, well, along with MS-13, vicious international gangbangers.
00:17:43.580And then it's going to come down to what arbitrary number the Fifth Circuit comes up with on the number of days that the Trump administration has to detain these people and give them notice before he can expel them from our country.
00:17:57.660And so it should be zero days because it's not part of the statute.
00:18:01.540It's not part of the Alien Enemies Act.
00:18:03.640I can't imagine that, you know, if you have an invading army that you have to hold them prisoner and get the court's permission before the commander-in-chief can expel an invading army.
00:18:16.160But, you know, we're dealing with Trump justices.
00:18:19.300The president depends upon or looks to you for a lot of guidance.
00:18:41.960Because he's going to give you a call.
00:18:43.180What are you going to tell him at midnight, sir?
00:18:45.200Well, what's going to happen is this is going to get sit down to the Fifth Circuit.
00:18:49.120The Fifth Circuit's going to largely side with President Trump.
00:18:52.420They're going to make up some arbitrary number to, you know, seven days, 14 days, 21.
00:18:58.920Days of notice to appease the Supreme Court justices, give them time to change their tampons, and then this thing is going to resolve itself.
00:19:09.580So I would say to the president, just let's go through this process down to the expedited process down to the Fifth Circuit.
00:19:20.420Let the adults on the Fifth Circuit rule the way they're supposed to rule.
00:19:23.580You know, at the end of the day, I would say to these Trump justices, if you are deciding a case and you see Justice Thomas and Justice Alito on one side and you see Justice Kagan and Justice Jackson and Justice Sotomayor and the Chief Justice John Roberts on the other side and you go with the liberal camp, you're absolutely wrong every time.
00:19:51.140You were wrong four weeks ago on Good Friday when you issued this lawless injunction against the president of the United States without a district court ruling, without an appellate court ruling, without a solicitor general brief.
00:20:06.160Have the modesty to admit you're wrong instead of punting this to the Fifth Circuit and letting the big boys on the Fifth Circuit clean up your work because you're too cowardly to do it.
00:20:16.180Okay, brother, Article 3, where do people go in your social media over the weekend?
00:20:21.040This is going to be a hot one, I can tell.
00:21:31.660The only problem we are having is with the Macron interference, the French interference.
00:21:39.240They ordered the Romanians in the Republic of Moldova, the government there, to bring as many people with Romanian citizenship as possible.
00:21:48.860So now they are voting three times they ever voted ever in their history, but it's only 50,000 votes.
00:22:02.220If they will only fraud with 50,000 votes, there's no chance in hell they will win.
00:22:08.200Hopefully, the dead people will not rise from the dead and we will not see them voting.
00:22:15.840We have about 100,000 people watching, observing from our side, all polling stations.
00:22:24.640The voting process started early this morning when I was in France, in London, in Washington, in New York, in Paris.
00:22:34.360The Romanians abroad can already vote.
00:22:37.220But we here in Romania, we are starting the voting process at 7 o'clock in the morning on Sunday.
00:22:45.400So basically, it will be a landslide if no frauds cure.
00:22:51.480However, we take very seriously the threats of our interim prime minister, which is also the Ministry of Internal Affairs,
00:23:02.600who ordered the police and some special services they have to check our phones, to enter in our messages.
00:23:10.620They will not find anything there except a clean campaign that is taking the Romanian voice and is making the will of the people become law.
00:23:25.500We will have the presidency and we will have the next government in Romania.
00:23:30.300And starting with Romania, we will win in Poland and other important EU countries.
00:23:35.620Why is Macron taking such a special interest in this?
00:23:39.960I mean, he's like, he's more active than your opposition in Romania.
00:29:55.780I don't necessarily think that there's much of it.
00:29:59.320Treasuries are still dealing, though, with the fundamental factor of less foreign demand for them.
00:30:05.720And the growing size of the pile of debt that needs to be constantly refinanced is not going to change.
00:30:12.500But it is symbolic in the sense of here's a major rating agency that's calling out the U.S.'s strained debts and deficits.
00:30:20.780And I don't know if that's enough to sort of change the negotiations currently right now in Washington.
00:30:25.700I think more impactful would be if the 10-year yield really started to spike, sort of like what we saw in the U.K. a couple of years ago.
00:30:34.140But I don't think we should ignore it.
00:30:35.900But on the other hand, I don't know how much of an impact it's going to have on the actual levels right now in the 10-year, for example, with that being the benchmark.
00:30:43.760He's 100 percent correct about the 10-year.
00:32:02.280They're going to be licking their chops now.
00:32:03.840They're saying, look at these downgrades.
00:32:05.560They're going to be licking their chops in Rio.
00:32:08.120July 6th, we're covering this thing wall-to-wall, the road to Rio.
00:32:11.820The bad guys, that would be the criminal gang in Beijing all over us on how to get off the dollar as a prime reserve currency.
00:32:20.500Not that we don't have to have a national debate for that, but you can't do that overnight.
00:32:24.040All right, Dave Bratt, the budget committee votes this thing down.
00:32:29.460They're now going to meet 10 o'clock on Sunday.
00:32:32.900I'm here to announce that the great Chip Roy, I think, is going to be with us tomorrow morning to start the show to talk about this, about talking about real cuts.
00:32:40.180My wingman is going to be Dave Bratt, who will even be better out of hair and makeup on a Saturday morning.
00:32:46.540What is the signal that you've got the budget committee because you've got the budget deficit hawk saying these cuts are not nearly significant enough.
00:32:53.340Then you get Moody's later in the day giving you a downgrade first time in 14 years, or 14 years, I should say, after I think S&P did it.
00:33:04.360Yeah, well, the heroes on the budget committee are doing the right thing.
00:33:08.900Moody's, they didn't downgrade us after the 0708 financial crisis.
00:33:13.000It takes the Trump derangement syndrome for them to weigh in.
00:33:17.420And the 10-year, you've been right on this.
00:34:38.740As a nation, we have had no spending cut victories of any consequence in nearly 30 years.
00:34:44.920In 1997, the balanced budget agreement included roughly $800 billion in mandatory savings adjusted for inflation.
00:34:52.360The current House bill includes $1.6 trillion in savings.
00:34:56.740These are not gimmicks, but real reforms that lower spending and improve the programs.
00:35:01.220The bill satisfies the very redline test that House fiscal hawks laid out a few weeks ago that stated that the cost of any tax cut could be paid for with $2.5 trillion in assumed economic growth.
00:35:14.440But the rest had to be covered from savings from reform.
00:35:18.460This bill exceeds that test by nearly $100 billion.
00:35:22.360So, after nothing happened for decades, the House bill provides a historic $1.6 trillion in mandatory savings with a three-seat majority.
00:35:32.460$36 trillion in debt is not solved overnight.
00:35:35.400It is solved by advancing and securing victories at a scale that, over time, gives a fighting shot to addressing the problem.
00:35:42.620The House's one big, beautiful bill deserves passage for many reasons.
00:35:46.520Tax cuts, border security funding, eliminating the Green New Deal, work requirements to end dependency.
00:36:52.560I think that there's two kind of camps.
00:36:57.740Russ is looking at mandatory cuts, and this is why he wants to get the top up for the defense, so you get that off so it doesn't come back every year.
00:37:06.620Russ is looking at structural, the way to get mandatories down, and do it over a period of time so you at least get on a glide slope indicator to start getting there, I believe.
00:37:16.920And prepare to trade off short-term, like getting rid of the whole Green New Deal right away, making sure the mandatory requirements are not 29, but here.
00:37:27.780We, on the other hand, I think you're in this camp, Brett, are saying, hey, we hear that that is good and a noble cause, and you are going to get some wins.
00:37:35.400However, the central part of the argument here is what Moody's is talking about.
00:37:40.140We are spending so far out of control with spending right now that we should just look at fiscal 26 and maybe 27, and because we're going to have a $2 trillion deficit this year because we didn't blow out Biden's thing.
00:37:55.260We kind of burden President Trump with that.
00:37:57.320This right here, and you're assuming some growth rates, you're still at a $2 trillion deficit.
00:38:02.860Is that the kind of tension here between people saying, no, we have to have massive cuts now and just going to have to bang through the politics versus those like Russ that are working on major and fundamental mandatory structural reforms that he's – I agree with him.
00:38:16.520They haven't been done in 20 or 30 years, and this is why I keep saying, folks, the farther we get down here, our range of alternatives are getting narrower and narrower, and now with the 10-year Treasury at right under 4.5 percent, you've got to look at the bond market because they're going to get a vote, and on Monday, all weekend, they're going to be talking, and on Monday, they're going to have an attitude adjustment because of the Moody's.
00:38:40.000Is that the two things we're dealing with here, those who want to cut massively now versus those looking for structural changes, sir?
00:38:48.700Well, you're being far more Christian and diplomatic than I would be on this point.
00:38:54.640I would say there are two camps, and it's the camps – it's political.
00:39:00.440It's are we going to do better than this, and do we just need to plug our nose because we can't take it and vote for this thing?
00:39:08.340Or do we think we can do better on this bill in the short run and make major improvements?
00:39:13.820The $1.6 trillion he listed, Strauss also went over it.
00:39:17.480The moderates have eviscerated the $1.6 trillion in spending there, right?
00:39:24.320The $17 bill had $1.5 trillion getting rid of deductions.
00:39:29.720Now we've added a trillion in deductions for every special group under the sun.
00:39:35.820And so for me, that's the choice, and I think we can do better.
00:39:40.420And I think President Trump – the key point I forgot to make this morning is Trump's legacy also is at stake here.
00:39:49.840If he knows what's going on here and that all of his gains are going to be wiped out in four or five years, right?
00:39:56.500We're giving all the good stuff away right now, and then in five years, the reforms all kick in, the medicine kicks in, and we're not looking so hot.
00:40:07.300And so, you know, I don't know when Russ made the comments, but I think it's just political.
00:40:12.440It's just do you pinch your nose in order to get the tax cuts through?
00:40:16.660And they will provide some economic growth.
00:40:18.740We absolutely have to have the tax cuts, right?
00:40:20.860You cannot go forward, and the debate is the nature of those tax cuts.
00:40:44.780I think we're going to try to get Russ on, Chip, a couple of people dealing with this thing.
00:40:48.900Nothing would be more important for the direction of the country than that thing we talked about in the middle, the economic model and the financing of it.
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