Government, Industry Need 'Partnership' to Address Affordability Concerns, Says Alsobrooks

0:00 It brings us, of course, to energy prices.

0:02 First and foremost, we're ever closer to four

0:04 and a half dollars a gallon on a national level.

0:07 You might have noticed sixes and sevens on the signs

0:10 going by here in California has got its own story.

0:13 In Maryland, it's slightly different.

0:14 I'm wondering what it means for people living in your state

0:17 and what they're not spending on as a result.

0:20 Well, you know what?

0:21 It's not just people in my state.

0:22 What we recognize is we are headlong in a war.

0:24 I mean, I think what you just read demonstrates that we

0:26 have no idea how to get out of the war.

0:29 Furthermore, the cost of the war is being borne by everyday, hardworking people.

0:33 These gas prices, you think about energy costs, the cost of groceries,

0:36 all of these various costs are being borne by working

0:39 class people who don't have the option of not paying.

0:42 So, you know, it's a really distressing time for us.

0:45 I think it's going to be really important for us to get out of this war soon.

0:49 But the cost and the affordability crises that we're seeing is real life.

0:53 It is not theoretical.

0:54 It is being borne by the people we know.

0:56 I see it in the grocery stores.

0:57 We see it all over.

0:58 And it really.

0:59 Well, how about for policymakers?

1:00 You're on the Banking Committee.

1:01 What's Kevin Warsh going to do this?

1:03 He's still cut interest rates when he comes in.

1:05 Well, we'll see.

1:05 I mean, part of the issue is that, you know,

1:07 I did not vote to support Warsh in his because,

1:09 you know, I couldn't be I couldn't be sure he would be independent.

1:13 I think the independence of the Fed, we know, is very important.

1:16 We know the two jobs there are to to make sure

1:19 that we are keeping down inflation and also protecting and growing employment.

1:24 And to do that means we have to have a Fed that is independent.

1:27 And he dodged questions that I would ask of him.

1:30 And I think an independent Fed is going to be really,

1:33 really important right now when people's lives and livelihoods are literally

1:35 on the line in a way that we've never seen before.

1:38 You know, I'm the daughter of a receptionist in a car salesman,

1:41 so I understand how challenging these times are for real people.

1:45 And the people who make these decisions,

1:48 they don't care about the cap, the cost of gas.

1:50 They're driven around.

1:51 You know, it's my colleagues and others.

1:53 I mean, if we're honest about it,

1:54 the people who are making these decisions are wealthy people.

1:56 But the people who bear the cost of all of these decisions are everyday,

2:00 hardworking middle class people.

2:02 Senator, we talk a lot about the K-shaped economy.

2:04 We talk a lot about the gaps that we have in society.

2:07 Do you blame President Trump for getting

2:09 in the way of access to capital or affordability issues?

2:12 Or is the system really the problem?

2:14 Because I think it's safe to say

2:16 under multiple administrations we have these gaps.

2:18 Yeah, I you know what?

2:18 Fair enough.

2:19 I think that obviously it's been exacerbated.

2:21 I think that's it by any objective measure,

2:24 our country now, I think the sentiment inside our country,

2:26 if you look at our polling and other numbers, people,

2:29 Americans just feel like they are further and further behind,

2:33 I think, objectively.

2:34 Or are they further and further?

2:35 Both.

2:36 They both feel like they're behind and they objectively are.

2:38 You think about every measurement we can think of homeownership, for example.

2:42 You know, my parents, when they married at 21 and 22,

2:44 they could buy a home within five years of their marriage.

2:47 The average age of a first time home buyer

2:49 in our country now is closer to 40 years old.

2:52 You know, add to that again what you're talking about,

2:55 the cost of just everyday living.

2:56 I think that this systemic the reason I'm here at Milken is because I

3:01 believe that there's a way for us to focus on creating wealth for people.

3:05 People are tired of the whole maybe we should live to get by.

3:08 Maybe we can make it so that you can afford your groceries.

3:10 There are pathways to wealth that I am interested in making sure

3:14 that as we see this whole kind of digital revolution that's happening,

3:17 I think we ought to be talking about wealth, not just getting by.

3:21 Wealth creation, generational wealth.

3:23 And those things happen, of course, again through homeownership and taking

3:26 advantage of the whole digital revolution.

3:29 We're seeing.

3:29 You're coming at this from a governmental approach as a senator,

3:32 but you came out here to Milken to talk to private enterprise as well.

3:36 How does that factor into the solution?

3:38 How do you get these people roaming the halls

3:40 at Milken to help you achieve those goals?

3:42 Well, we recognize it's going to have to be a partnership between the federal

3:46 government and the private sector to address so many of the long standing.

3:49 To your point, these are long standing issues, systemic issues.

3:52 I know it because I came to the Senate as an executive.

3:55 As a matter of fact,

3:57 I'm the only part of my Democratic class who didn't come from the house.

4:01 I came there as an executive.

4:03 I was county executive of my county where

4:05 I had to rely on sometimes public private partnerships.

4:07 We did so to build cancer centers,

4:09 to build schools, and to really get our economy going.

4:12 And I think that same approach is going

4:14 to be really important that you said that.

4:15 I think the local level is something that gets so missed in reporting.

4:18 I think we try to do it really deeply here at Bloomberg.

4:20 But what's happening on the ground?

4:22 Having said that, you are here at Milken.

4:24 The financial presence, as you know, is a big one.

4:28 Here.

4:28 It is, you know, trillions of dollars that are being managed globally.

4:32 What do you want to say to especially

4:34 a lot of billionaires who are pushing back,

4:35 whether it's New York City or San Francisco,

4:38 in cities that are fighting taxes and so on?

4:40 I mean, what do you say to them?

4:42 Well, you know what?

4:43 Who do you want have a conversation with?

4:44 I think we should have a conversation with both.

4:46 I mean, you're right.

4:47 The billionaires are here.

4:48 The government officials are here.

4:50 The truth of the matter is that we should all be focused on making sure

4:53 that we are creating additional pathways for more

4:55 and more people to participate in the system.

4:57 It makes us better when we all do better.

4:59 We all do better.

5:01 So we creating these pathways.

5:02 And you know what?

5:03 I'm here because I want to hear from all sides.

5:06 You know, tell us how we can do it better.

5:07 If you have some ideas about the ways that we can do things more cheaply,

5:11 more effectively, how we can cut red tape,

5:13 whatever we can do to make sure we're making a more

5:16 robust kind of effort to include people in economic opportunity.

5:20 I'm also here to listen.

5:21 I have some ideas of my own, but you know what?

5:24 To be effective, it means we're going to have

5:25 to kind of listen to each other and and, you know,

5:28 and I'm here to implement those ideas in the Senate.

5:31 I spoke earlier today with the secretary of Housing and Urban Development,

5:34 who's at Milken as well.

5:35 The administration is on the ground here, as we've been discussing.

5:38 And he talked about the cost savings that came with his decision,

5:41 the administration's move to eliminate the IPCC,

5:45 the energy efficiency mandate that was put in place by the Biden administration.

5:50 You talk about red tape.

5:51 He says this takes $30,000 off the cost of a home.

5:54 Is that the kind of move that you would support?

5:56 Is there common ground between the administration and Democrats

5:59 on this, or is it risky to eliminate energy efficiency?

6:02 Right.

6:02 I think that it's risky to eliminate energy efficiency.

6:05 I mean, I think we all agree that we want to have more and more efficiencies.

6:09 I think that there are some things that should be adjusted,

6:11 You know, is the reason I'm on the Environment and Public Works Committee.

6:14 We're looking at some of the permitting and some of the other things.

6:16 They're in some instances they are.

6:18 The balance is a great work.

6:20 You know, I think balance is a great word.

6:22 I'm looking for what the balance is.

6:23 Yeah, it reminds me of what my daughter said.

6:25 You know, she told me coming to the Senate,

6:27 make sure you listen out for people who don't necessarily agree with you,

6:30 take up some space and find yourself at some tables,

6:33 having conversations where you can get to a real solution.

6:35 Some of those are right in the middle.

6:37 I think the fringes are where we've been hanging out.

6:39 I think we're going to have to come more

6:41 to the middle to find a balanced approach because again,

6:43 as I've said, these are not theoretical conversations.

6:45 If we're talking about homeownership and in talking about ways

6:49 that we can increase the housing supply and other things,

6:51 energy efficiency is is going to be important.

6:54 But we also have to do so in a way that is reasonable, that's not burdensome,

6:58 that doesn't slow us down or prevent us from reaching the goal

7:01 of of getting homeownership into the hands of more and more Americans.

7:04 Where we know, as a matter of fact, is where generational wealth is created.

7:08 So we got to listen to each other.

7:10 But the balance in it, I think, is where we should be.

7:12 A lot of wealth created in the cryptomarket,

7:14 although it goes up and down, as we know.

7:16 Let's talk about the crypto bill.

7:17 Last Friday, you and Senator Tillis unveiled a compromise bill,

7:21 so-called, you know, got into stablecoin rewards.

7:24 What's what's the progress on this and when

7:27 do you expect or anticipate a possible vote?

7:29 And how do you deal with the ethics issue of an administration,

7:33 a presidential family who has a lot of exposure investments in crypto?

7:39 So, you know, what do I think?

7:40 I think they come a long way.

7:41 I mean, I'm going to answer that question as well.

7:43 But if you're asking where we are,

7:45 it's Senator Tillis and I have done a lot of work

7:47 to make sure that we are not only allowing innovation to grow,

7:50 but protecting also many of the community banks that have been really important,

7:54 making sure that deposit flight does not happen,

7:57 that we're not allowing interest and yield to be paid solely on a balance,

8:01 or that we're mimicking bank like products without the protections of a bank.

8:05 So we have been working on that, but also

8:07 making sure that we are allowing innovation to grow.

8:10 And we believe that it I believe it's important

8:12 for us to have regulated an industry that is already growing.

8:15 We don't want America to be behind the rest

8:18 of the world where crypto is concerned, I and other things.

8:21 And so really being at the table too, to make sure we are negotiating.

8:24 Having said that, you're right.

8:25 There's some other issues illicit finance, ethics.

8:28 These are issues that absolutely have to be addressed.

8:31 And and we're working with our colleagues.

8:33 I know that on our side we have a Senator Cortez Masto,

8:37 Senator Schiff and others who are working along in a bipartisan way to come up

8:42 with some smart solutions so that ethics

8:43 can be addressed on the larger public issue.

8:46 Do the Republicans have those same concerns, those ethical concerns?

8:49 I think some do.

8:50 I think that some do.

8:51 You know, not all, but I mean, similar to what we found on this banking

8:55 issue in the is stable the interest issue.

8:58 Senator Tillis made a tremendous difference when he

9:00 joined me in raising this as an issue.

9:03 And we found out in doing so that we

9:06 have colleagues on either side who who agree with us.

9:08 So there are some Republicans who are concerned about the ethics

9:11 issue and have said that they want to see it addressed.

9:13 And I want to see it.

9:14 There's nothing more powerful than a retiring

9:16 Republican in the Senate right now.

9:17 You're making friends with the right people, Senator, I'm sure you look,

9:20 our audience has really basic questions when it comes to clarity.

9:23 Yeah.

9:23 Is it going to pass and is it going to happen this year?

9:26 Because when you talk about it,

9:26 you make it sound like there's still a pretty long road.

9:28 You know what?

9:29 I think it can pass.

9:30 I really do.

9:31 I mean, I think is that somewhere in this country.

9:32 I think I hope so.

9:34 We've we've had a lot of work.

9:35 We've put a lot of work into this.

9:37 I mean, we've been working tirelessly for months.

9:39 What it will mean is we're going have to have some compromise.

9:42 You know, I think everyone will walk away

9:44 from the clarity table just a little unhappy,

9:45 both the banks and the industry guys on potentially.

9:48 Well, you know what?

9:49 We've compromised and said we want the innovation to grow,

9:51 but we don't want to create bank

9:53 like products without the protections of a bank.

9:55 You cannot pretend to be a bank like product without the protection.

9:59 Stablecoin yield the biggest holdup.

10:01 That was a big holdup.

10:02 We're still there, though, right?

10:03 Well, I think we have.

10:04 I think we've resolved the yield issue.

10:06 We did We have resolved the yield issue

10:08 in a way that I think prevents evasion of the laws,

10:12 again, allows the innovation to grow.

10:14 But, you know, we put some some I think some barriers

10:17 in place that will allow both to be a little unhappy.

10:21 But I think it's a way forward.

10:23 How does it create more access for wealth creation for a broader public?

10:27 Well, generally, what we see when we see these kind of revolutions

10:31 that we see that people who are underserved generally can't get in.

10:35 The only people who can who can benefit from them are wealthy people.

10:38 In this case, when we think about small businesses who using,

10:41 for example, a stablecoin can do transactions more quickly and more cheaply.

10:46 This is this is very this is a change.

10:49 You know, it is something that will allow

10:51 businesses to grow and allow more and more people.

10:53 I think for the debate, that's what you're doing here.

10:55 Yeah, I think for the banks, for the under-banked and the bank,

11:00 these are really game changers to allow more and more people

11:03 to participate in a marketplace where they have been shut out before now.

11:06 But again, we have to do so making sure we have the right regulation,

11:10 that we have consumer protections in place, making sure we're protecting them.

11:14 But for the under-banked and the bank.

11:16 This is a complete game changer to allow more and more people to get

11:20 into the marketplace and to to be able to participate and to make money.

11:25 I you know, I asked this of our last guest.

11:27 I have no idea what how much time we

11:28 have because I can't hear a thing about 30 seconds.

11:30 So it's a number one question everybody wants to know from you.

11:35 Just quickly, you see a lot of people said, you know what,

11:39 I think everyone wants to know what the way forward is.

11:41 The people that I attend to serve are concerned about economic opportunity.

11:44 They want to know what we're going to do to fix the place.

11:48 We are in our country, where people are feeling really discouraged.

11:51 And I think it's by participating in things like

11:54 this to work together to find those ways forward.