On this “Face the Nation” broadcast, moderated by Margaret Brennan:
- Rep. Ro Khanna, Democrat of California
- Rep. Nancy Mace, Republican of South Carolina
- Rep. Tony Gonzales, Republican of Texas
- Gary Cohn, former top economic adviser in the Trump White House and now vice chairman of IBM
Click here to browse full transcripts of “Face the Nation.”
MARGARET BRENNAN: I’m Margaret Brennan.
And this week on Face the Nation: New signs of spring strain on the economy, and Washington politicians prepare for the annual surge of migrants at the border.
An 11th-hour rescue is under way in an effort to save First Republic Bank, as the Fed takes partial responsibility for the March collapse of Silicon Valley Bank.
We will talk with California Congressman Ro Khanna.
Former Trump administration economic adviser Gary Cohn will also be here.
Then:
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REPRESENTATIVE TONY GONZALES (R-Texas): In Texas 23, not only are we the epicenter of this border crisis. It feels as if it is hell for us.
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MARGARET BRENNAN: Republican Congressman Tony Gonzales weighs in on the Biden administration’s new plans to stem an expected border surge and what his party is proposing as those pandemic border restrictions, known as Title 42, will soon be lifted.
And as the state-by-state march to solidify abortion laws continues. South Carolina Republican Congresswoman Nancy Mace will join us. She’s warning her party to find a middle ground on abortion access.
Finally, the annual White House Correspondents Dinner honors Americans wrongfully detained overseas. The power of the press in a democracy.
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JOE BIDEN (President of the United States): A free press is a pillar, maybe the pillar, of a free society, not the enemy.
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MARGARET BRENNAN: And, of course, some self-deprecating humor, Washington style.
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PRESIDENT JOE BIDEN: After all, I believe in the First Amendment, not just because my good friend Jimmy Madison wrote it.
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MARGARET BRENNAN: It’s all just ahead on Face the Nation.
Good morning, and welcome to Face the Nation.
As we look to a new month, we’re keeping a close eye on the economy, which continues to be the number one issue of concern for Americans. Last week’s news that economic growth slowed more than expected in the first quarter of the year will almost certainly factor in to the Federal Reserve’s decision- making this week, as we prepare for yet another interest rate hike to try to curb inflation.
Complicating the Fed’s dilemma is the political battle on raising the debt ceiling, fallout from the collapse of Silicon Valley Bank, and the looming prospect of a third government bank rescue, this time for California-based First Republic.
We begin with Democratic Congressman Ro Khanna, whose district was home to SVB.
Good morning to you.
REPRESENTATIVE RO KHANNA (D-California): Good morning.
MARGARET BRENNAN: Last time you were here, there were urgent efforts under way to save a bank, today, again, urgent efforts, this time First Republic.
We are hearing it could be seized by the FDIC, but there are also efforts to find a buyer to absorb it. What are you hearing?
REPRESENTATIVE RO KHANNA: Well, this is what a modern bank run looks like.
Let me tell you what companies in my district are saying. They’re saying that payroll companies are telling them, move your deposits out of First Republic. You’re not going to be able to have access to the accounts.
That’s why I think it is so important that we guarantee all bank depositors. I had said this last time I was on. There’s $8 trillion, Margaret, is uninsured deposits in these banks; $10 trillion is insured.
Until we guarantee them and we can charge a fee, we run the risk that there…
MARGARET BRENNAN: We is Congress.
REPRESENTATIVE RO KHANNA: Well, the Congress, yes, Congress. I have been working with Senator Rubio on this, on a proposal to say, look, pay a fee, and have some guarantee on these deposits, because, otherwise, what’s going to happen?
Regional banks, they’re going to be insecure. People are going to be concerned. And they’re going to start to consolidate into the top banks. And you have a lot of these payroll companies telling these companies to move to this — the bank.
So, I believe the FDIC is doing fine and well now, but we have got to prevent this from happening again. And the best way to do it is to guarantee these deposits.
MARGARET BRENNAN: Well, in the meantime — what you’re talking about takes — takes a long time. We’re talking immediate sense here for First Republic.
And some progressive Democrats have objected to the idea that some of the big banks, who can afford to buy little ones and the systemically important ones, that they should be prevented from stepping in to buy up First Republic. Is that where you fall?
REPRESENTATIVE RO KHANNA: No, I think that the FDIC needs to look at the lowest-cost alternative. That’s their mandate.
And, right now, they may need to work with banks and private capital to save First Republic. I mean, that is the state we’re in. But we can move quickly. Look, in the CARES Act, we actually said that all deposits were guaranteed for transaction accounts.
I think, if we do something like that quickly, we prevent this going again. We also need reform. I mean, look at what has happened, Margaret. Every time the economy heats up, we somehow say, deregulate, deregulate, and it never works out.
In 2018, the deregulation basically sent a signal to the Fed to stop the oversight on these banks.
MARGARET BRENNAN: Well, there was a lot in that report that I want to get into that just came out.
But, first off, one of the things blamed was poor management. Gregory Becker, who you knew…
REPRESENTATIVE RO KHANNA: Yes.
MARGARET BRENNAN: … the former CEO of SVB, he had donated to your campaign as well.
REPRESENTATIVE RO KHANNA: He had.
MARGARET BRENNAN: When he was at the helm, did you think at the time it was a problem that he was also on the board of the chief regulator there, the San Francisco Fed?
REPRESENTATIVE RO KHANNA: I did not know at the time, but I do think now that that should not be allowed.
I mean, no, I didn’t have a sense back then that Silicon Valley Bank was going to have a challenge. Obviously, there was mismanagement. One reform we should have is that bank executives should not be on the board of the Fed, regional Fed that’s overseeing them. And I think that’s a lesson.
I also think there needs to be a clawback of his bonus. There needs to be a clawback of executive compensation and for tougher rules on bank executives who have failed banks.
MARGARET BRENNAN: And yet the momentum doesn’t seem to be there in Congress, either from the Democratic leader in the Senate or in the Republican-led House. Why?
REPRESENTATIVE RO KHANNA: Well, there should be momentum for three things, one, the clawbacks on these executives. That could be bipartisan.
Two, for greater oversight and the rules on these banks. I mean, we’re — we basically told these banks not to regulate. But the big place — and I’m working on a bipartisan basis — protect the regional banks. That’s going to help regional community banks the most and mainstream America. That’s the biggest risk to the economy.
Look, you have — Margaret, you have 5 percent interest rate. People are moving out into money market funds. They’re moving out of banks. If we don’t have a guarantee, we run a real risk across this country.
MARGARET BRENNAN: On this, though, in terms of regulation, there were regulations in place. There were 31 supervisory findings, warnings from regulators about SVB when it failed. There were warnings in August. There were warnings in February.
Doesn’t that suggest it wasn’t lack of regulation, but regulators not acting?
REPRESENTATIVE RO KHANNA: Well, it was both.
MARGARET BRENNAN: They’re raising flags and not doing anything.
REPRESENTATIVE RO KHANNA: When Congress passed deregulation, there’s not a straight line between that and what happened, but it certainly sends a signal to the Fed that maybe the Congress doesn’t care as much.
And I think there was lax oversight. Look, they noticed that there was risk there. But they didn’t do the right liquidity or stress test. I mean, they didn’t do a test to see what happens in a high-inflation environment, when Chair Powell has been saying for over a year he’s going to raise rates. So…
MARGARET BRENNAN: But you — you have confidence in Chair Powell and Mary Daly at the San Francisco Fed?
REPRESENTATIVE RO KHANNA: I don’t think you can blame Chair Powell. I have disagreed, but I don’t think you can blame him for this.
I do think we need to know, what are the concrete reforms? Let’s stop having bank executives on these boards. Let’s make sure that you have better liquidity tests and stress tests. Let’s have the regulations we repealed in 2018 back there and have some statement on guaranteeing the bank deposits, so I don’t have to come here every…
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REPRESENTATIVE RO KHANNA: … every few weeks.
MARGARET BRENNAN: With another crisis.
Let me ask you about a looming one, what to do about the debt ceiling. The Fed is predicting a mild recession is ahead of us. The president has overseen the highest inflation that we have seen in decades in this country. Whether he caused it or not, he’s overseeing it.
You have all these looming issues, and now you have the standoff over the debt ceiling. It is not a sustainable position for the White House to say they’re not going to negotiate with Republicans, is it?
REPRESENTATIVE RO KHANNA: Well, here’s what’s sustainable.
They — the Republicans should do what I did under Donald Trump, and that’s pay your bills. It’s patriotic to pay your bills. Look, if you’re a family, you have credit card debt.
MARGARET BRENNAN: It sounds like you’re agreeing it’s not a sustainable position.
REPRESENTATIVE RO KHANNA: Well, I think we should pay the bills and then negotiate. And we should negotiate on deficit reduction.
The last person to leave a surplus was Bill Clinton. I will tell you how we lower the debt. Let’s repeal the Trump tax cuts. Let’s repeal some of the Bush tax cuts for the very wealthy. Let’s not have all these overseas wars.
I mean, the Democrats have a plan. And let’s raise taxes on the top wealthy. But, before we get there, we pay our bills. If you’re a family and you a credit card debt…
MARGARET BRENNAN: Yes.
REPRESENTATIVE RO KHANNA: … who says, let’s not pay the bill?
MARGARET BRENNAN: But the president was saying, Kevin McCarthy, pass something, or at least put out a plan, and I will talk to you.
Now he’s passed something, and the president says he still will not engage with him. I understand the back-and-forth. But the political cost and the economic one is very real here. And it will stick to the president.
REPRESENTATIVE RO KHANNA: Well, the president is saying he’s not going to be hostage in having veterans cuts on health care, in having cuts on K-12 education, in having cuts on food stamps, in having cuts on manufacturing to just pay our bills.
He’s saying, we can discuss that. We can negotiate, but, first, pay your bills.
And I think the — I think Senator McConnell understands this. And I think the president will sit down with Senator McConnell. He knows that we can’t default.
MARGARET BRENNAN: You think that’s the back channel that’s going to figure this out?
REPRESENTATIVE RO KHANNA: That’s why I said that.
MARGARET BRENNAN: The leader in the Senate.
REPRESENTATIVE RO KHANNA: Or Kevin McCarthy has got to come without 22 percent cuts on veterans’ benefits.
MARGARET BRENNAN: Well, we will see.
And I do hope to have you on again, when there’s not a looming crisis, Congressman.
Last week, two heavily Republican states, Nebraska and South Carolina, failed to pass near-total abortion bans.
South Carolina Republican Congresswoman Nancy Mace joins us now.
And it’s good to have you here in person. You’re often joining us remote.
REPRESENTATIVE NANCY MACE (R-South Carolina): Good morning, and thank you for having me.
MARGARET BRENNAN: So, I want to get to a lot of what we just talked about there with the debt ceiling. But let’s start off on abortion.
You have been talking about the — this being a very moral issue, but also a political one that will impact voters in 2024. Nikki Haley, the former ambassador, former governor of your state, said no Republican president will have the ability to ban abortion nationwide.
And she believes there is a federal role on abortion. But she didn’t say specifically what it is that she believes, no limits exactly, no exceptions. Does she need to?
REPRESENTATIVE NANCY MACE: Well, I think any presidential candidate, anyone running for office at the federal level, including members of Congress, incumbents and people that are running to flip seats in ’24, need to have a position, need to articulate that position.
And what I have been trying to do since Roe was overturned is show a road map. I represent a swing district in South Carolina, but show a road map for winning states that are very purple or districts that are purple, and articulating where we stand on the message.
And we have to show — and I’m pro-life, but I’m a conservative who reaches across the aisle and works with the other side. I work with Ro Khanna. Great to see him this morning on your program. I work with Democrats all the time on issues where we can agree on.
And there’s so much when it comes to protecting life and protecting women that we can agree on, in terms of gestational limits. That’s something that can happen at the state and the federal level. And I talk to and listen to my constituents all the time. And I read a letter from a woman who’s no longer a Republican. She’s an independent voter now. She’s pro-choice. And her gestational limits are 14 weeks. Well, I’m a pro-life legislator. Mine are 15 to 20 weeks and want to make sure there are exceptions.
So, there’s so much, I think, in how we talk about the issue, but we have to, as Republicans, show compassion towards women and life. I mean, you can do both and win. I did it overwhelmingly in November, when we won by 14 points, overwhelmingly in a swing district.
MARGARET BRENNAN: And the — just for clarity, the majority of abortions are performed in that window of 15 weeks.
REPRESENTATIVE NANCY MACE: Right.
MARGARET BRENNAN: So, former President Trump has taken criticism from Republicans, though, for not specifying a position either, has just said it’s up to the states.
Both of South Carolina senators have picked that window, 15 weeks, 20 weeks. Tim Scott’s running for president potentially here. He said he’d signed a 20-week limit. Is he closer to what the Republicans need to be doing than Nikki Haley is?
REPRESENTATIVE NANCY MACE: Well, I think 15 to 20 weeks is the sweet spot here, because Democrats often are at 24 weeks. And that’s too far for a lot of people. No one wants zero. No one wants zero weeks, yes.
MARGARET BRENNAN: But you want this, to be clear, at the federal level? You want a law, not kicking it back to the states?
REPRESENTATIVE NANCY MACE: It can be. I mean, I think there’s a role for the state government and for the federal government. If it’s gestational limits, certainly, we can find some agreement. That’s why I say 15 to 20 weeks.
That’s something even pro-life groups like Susan B. Anthony’s List, although they’re against it now, two years ago, they were for 20 weeks with exceptions. They have just moved the goalposts. But, for years, Republicans have been for 15-to-20 week bans, with exceptions, including both my senators from South Carolina at the federal level. And I think most — 80 percent of America would agree with that.
But they want us to protect women and girls who are victims of rape, victims of incest, women whose lives are at risk. We also need to make sure that we’re making — that — that birth control — that women have access to birth control…
MARGARET BRENNAN: Yes.
REPRESENTATIVE NANCY MACE: … particularly in rural areas.
In South Carolina, we have 14 counties in our state that don’t have a single OB-GYN doctor. And then what do we do with the babies who are born who are unwanted? What about our foster care system, adoption care, birth control?
There are so many things that we can work on to show that we’re pro-women.
MARGARET BRENNAN: Yes.
REPRESENTATIVE NANCY MACE: Rape kits. We have over 100,000 rape kits in this country that have yet to be processed. We can do both. We can walk and chew gum at the same time.
MARGARET BRENNAN: Well, you have said Republicans need to have a woman on the ticket.
REPRESENTATIVE NANCY MACE: Yes.
MARGARET BRENNAN: Nikki Haley endorsed you. Are you ready to endorse her?
REPRESENTATIVE NANCY MACE: Well, we’re going to see how the race shapes up that — not everybody is in. I’m watching very carefully.
I love Nikki Haley. I have not been quiet about that. She was the only person to endorse me in my election last year. And I do want to see a woman on the ticket, but I also want to see who jumps in. I want to give everybody a shot. But I am cheering her on. She’s a constituent. And I love what she’s doing.
I love that she gave a speech last week on women’s issues. That’s very important. Women are watching,
MARGARET BRENNAN: But you want her to go farther and be more specific, is what I understand.
REPRESENTATIVE NANCY MACE: I would love to see her move on, yes.
MARGARET BRENNAN: So, can a Republican candidate who supports or signs into law, as Governor DeSantis did, a six-week limit to abortion…
REPRESENTATIVE NANCY MACE: In dead of night, by the way, yes.
MARGARET BRENNAN: Can he succeed in running for the presidency?
I mean, is this really going to be something that — and people who are in Republican districts have to make this calculus. You say you’re in a purple one, so you have to compromise.
REPRESENTATIVE NANCY MACE: It’s the — well, it’s the number two issue in my district. Number one is inflation. The debt ceiling is an important issue.
Number two is abortion and finding a middle ground. Signing a six-week ban that puts women who are victims of rape and girls who are victims of incest — incest in a hard spot isn’t the way to change hearts and minds. It’s not compassionate.
The requirements he has for rape victims are too much, not something that I support. It’s a nonstarter. I am a victim of rape. I was raped by a classmate at the age of 16. I am very wary. And the devil is always in the details. But we’ve got to show more care and concern and compassion for women who’ve been raped. I don’t like that this bill was signed in the dead of night.
And it puts him in a very difficult position for a general election in my opinion, which is why I have been so vocal on this issue. I would like us to win. I would not only like us to win the Electoral College. I want us to win the popular vote. And if we can show the middle ground, which shouldn’t be controversial — birth control shouldn’t be controversial.
MARGARET BRENNAN: Yes.
REPRESENTATIVE NANCY MACE: It keeps the number of abortions down if women have access to birth control. It shouldn’t be controversial.
MARGARET BRENNAN: Well, it’s interesting…
REPRESENTATIVE NANCY MACE: Yes.
MARGARET BRENNAN: … because some candidates also, like Mike Pence, have said he would sign a 15-week limit, but he ultimately wants to get to a ban.
So there’s some — some nuance in there too in some of these positions.
But I want to ask you about debt ceiling. You opposed and then voted for Speaker McCarthy’s bill that we were just discussing with Congressman Khanna here to lift the debt ceiling in exchange for trillions of cuts. The bill is dead on arrival in the Senate. The White House says they’re not ready to negotiate.
Can you actually be confident that we will avoid getting close to default, even if we don’t get over that cliff? It’s very dangerous, the longer this goes on.
REPRESENTATIVE NANCY MACE: It is. And we don’t want to play chicken with the economy.
And when I sat down with Kevin McCarthy, the speaker, on Wednesday, we talked about us leading a balanced budget amendment. I believe we need to do that. As you mentioned, as Ro mentioned earlier, the last time we balanced the budget was under Bill Clinton. Republicans in ’94 put together a plan to balance a budget in 10 years.
They did it in ’98, four years later, with a Democrat president and a Republican majority. It is not out of — out of the thinking that we can do this together, with a Democrat president, Republicans in charge. We did it again. We had cut, cap and balance in 2010 with Obama as president. So…
MARGARET BRENNAN: Are there red lines here for you, though?
REPRESENTATIVE NANCY MACE: Well, certainly, the fear tactic of default is a red line. That is not going to happen. We get 11 times the revenue that we need to pay the interest on the debt. The president can also prioritize spending.
We don’t — no one wants to cut veterans benefits or Social Security or food stamps. That’s not what this is about. But we have $31 trillion in debt that was started by both sides, under President Trump, $8 trillion added to the debt, under President Biden, $4 trillion. That’s $12 trillion in six years.
The president needs to come to the table, take a look at what we have offered and start negotiating. This is a serious problem. And, as Ro mentioned earlier, families are living paycheck to paycheck. They have to balance their checkbooks every week. So too should the federal government. Our tax revenues last year were $4.7 trillion, yet we’re spending over $6 trillion every single year.
MARGARET BRENNAN: Well, we are not going to abandon this issue. We know it’s going to be looming for some time. Thank you, both of you, for joining us.
Face the Nation will be back in a minute. Stay with us.
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MARGARET BRENNAN: We turn now to immigration and the ongoing effort to secure America’s southern border.
We’re joined by Texas Republican Congressman Tony Gonzales. He’s at our affiliate in San Antonio, KENS 5.
Thank you for joining us this morning.
REPRESENTATIVE TONY GONZALES: Thank you for having me, Margaret.
MARGARET BRENNAN: I don’t have to tell you this date of May 11. But, for our viewers, that’s when this health emergency restriction known as Title 42 will expire.
Homeland Security is looking at 10,000 people per day potentially crossing the border. Do the agents you represent have what they need to deal with the surge?
REPRESENTATIVE TONY GONZALES: They do not, Margaret.
And this is, honestly, the fourth time that we’ve seen this Title 42 is going to end. And every time we come to this situation, before the crisis is this uptick in illegal immigration. And we’re seeing that now, whether it’s Brownsville, whether it’s Eagle Pass, or whether it’s El Paso.
Now it’s all three of those areas. And so the numbers are getting worse. The agents are beyond an exhausting point. And it’s not just at the border. Now what you’re seeing is places 100, 150 miles from the border are just as overwhelmed as if they were on the Rio Grande themselves.
MARGARET BRENNAN: Well, you are set to vote in the House on May 11 on a border bill.
You’re part of the Congressional Hispanic Conference, which had opposed the Republican bills, on the grounds that you needed provisions in it to help legal migrants in the asylum process.
I know you are now on board, dropped that position. What changed for you? And is there anything in here that can get through a Democratic-controlled Senate?
REPRESENTATIVE TONY GONZALES: Yes, Margaret, it’s an exciting time for the Congressional Hispanic Conference, which I’m the co-chair with Mario Diaz- Balart.
It’s — we’ve got 18 different members. It’s the first time we’ve set a marker down and said, our voices will be heard. One of the — I have been very public. I have essentially negotiated both in public and in private. One of the things that I, in particular, asked for is to not curb legal immigration, not hamper those that are legally doing the things that they need to do to come over.
And a lot of that was stripped away in the Judiciary part of it, which was half of the package. The Homeland Security package, which I sit on that — that committee, I asked for some specific things. One was ensuring that we hold cartels accountable. You want to get to the root of the cause, they’re the issue.
So we go down this path of labeling cartels as terrorists. Another is giving resources to the people that are doing the work.
MARGARET BRENNAN: What does that do?
REPRESENTATIVE TONY GONZALES: We added $110 million — yes, $110 million for deputy sheriffs and — and local law enforcement officers.
I did a ride-along with the Medina County Sheriff’s Office on Monday. Once again, this is 120 miles from the border.
MARGARET BRENNAN: Yes.
REPRESENTATIVE TONY GONZALES: Their police cruisers are getting — are getting trashed and — and other things.
And the last piece is, we got to give a pay raise to the border patrol agents.
MARGARET BRENNAN: Yes.
REPRESENTATIVE TONY GONZALES: They got a $9,000 bonus in this aspect of it. But we got to go further.
MARGARET BRENNAN: OK.
Well, on that House bill you just voted for to lift the debt ceiling in exchange for cuts, the White House argues it would mean cutting funding for Customs and Border Protection. Do you have any guarantees from Republican leadership that, in a future deal, there won’t be cuts to the agents you represent?
Because you just signed a bill that would do that.
REPRESENTATIVE TONY GONZALES: Look, I was on the fence. It was 215 to 215 when I ended up voting in favor of the debt ceiling. So I have some very deep concerns with — with the direction we’re going.
Universal cuts don’t — don’t always solve the issue. In the same breath, just throwing money at a problem doesn’t solve the issue. So what I’m trying to do is, I’m trying to go, where is the money going? How does DHS, instead of getting them a blank check, how do we give them money to the things that are going to help secure the border, like repatriation flights?
These are flights where people that do not qualify for asylum, they don’t get flown to New York or D.C. or Chicago. They get flown back to their country of origin. That is how you solve the border crisis, other things like hiring Border Patrol agents. But you can’t just give DHS a blank check and have them go spend it on all these things that is — only encourages illegal immigration.
MARGARET BRENNAN: I have more about — about this to get into with you, but I have to take a quick commercial break, so please stay with us, Congressman.
And we’ll be back with all of you and a lot more Face the Nation in a moment.
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MARGARET BRENNAN: If you miss an episode of Face the Nation, you can listen to our podcast. Find us on Amazon Music or wherever you get your podcasts.
We will be right back with a lot more Face the Nation. Stay with us.
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MARGARET BRENNAN: We will be right back with a lot more Face the Nation, including more with Congressman Gonzales and former head of the National Economic Council in the Trump administration Gary Cohn, plus a conversation with parents about kids and the impact gun violence is having in their lives.
Stay with us.
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MARGARET BRENNAN: Welcome back to FACE THE NATION.
We return to our conversation with Texas Republican Congressman Tony Gonzales, who joins us from San Antonio this morning.
Congressman, I want to pick back up on border security. Migrant families, after May 11th, if they cross into the U.S. illegally will not be detained by the Biden administration. The Trump and Obama administrations did detain families. Should families be detained?
REP. TONY GONZALES (R-TX): There should be repercussions for people that enter the country illegally. And this is where the Biden administration is getting wrong. First off, they’re doing more. And I appreciate the fact that they’re trying different things. It’s taken them a while, but I appreciate that. This is what they’re getting wrong. They’re putting all their time and effort into illegal immigration, finding ways to increase capacity, finding ways where people can come over illegally quicker. The reality is, nine out of ten people that come over into our country illegally do not qualify for asylum. So, stop sending them down that route when you know they’re not going to qualify for asylum.
I am of the mindset, we need to encourage those that come over legally. I believe in work visas. And, once again, I’m –
MARGARET BRENNAN: You would have to change the asylum laws though. That’s Congress.
TONY GONZALES: You do have to – you do have to change the asylum laws. And it’s — it’s something that the president should work with Congress on.
You haven’t heard the president say one thing about immigration, other than just blame others. Congress has a role to play. I think that us passing this bill in the House on security is important. The next step is immigration reform.
MARGARET BRENNAN: Yes.
TONY GONZALES: I am committed to doing that. You haven’t seen anyone even try immigration reform in the past decade. I think it’s long time that we do something.
MARGARET BRENNAN: Yes.
TONY GONZALES: In my opinion that starts with protecting those doing that are doing it legally through work visas.
MARGARET BRENNAN: So, just to be clear, do you think it’s humane to keep kids in detention centers with their parents?
TONY GONZALES: I – I think there needs to be a process where folks have their asylum claim heard in days, not years. And if they qualify for asylum, welcome to the United States. And if they don’t, you have to send them back to their country of origin.
What – what we can’t do is what we’re having now. Right now we have tens of thousands of children that are just being released into this country. What is happening to these children? Regardless of their legal identity, I mean, what is happening to these children-these children?
So, we have to enforce the lawsuit that are on the books and we have to encourage those to come over legally.
MARGARET BRENNAN: Yes.
TONY GONZALES: And make it easier for folks to obtain work visas.
MARGARET BRENNAN: OK. Well, Health and Human Services takes those kids — custody of them, but – but point taken on needing to watch what happens next.
Congressman, thank you very much for your time today.
We want to turn now to Gary Cohn, who is the vice chairman of IBM, former Goldman Sachs president and former Trump administration top economic adviser.
Good morning to you. Lots of titles, Gary, lots of experience. That’s why we like having you here.
I want to ask you about what’s happening with First Republic. It’s been under pressure. We know they’ve been looking for a buyer. The FDIC, the government, is looking to arrange moving it into government control and then maybe selling it. What are you hearing about how this would roll out?
GARY COHN (Vice Chairman, IBM): Margaret, thanks for having me.
I think you’re portraying the situation as we find ourselves again on a weekend. As we closed business Friday, the FDIC was in the process of looking for acquirers or bidders for the assets. Over the course of the weekend, I think the FDIC has asked potentially three banks for their final bids for the entire bank. The FDIC would prefer to sell the bank in its entirety than the pieces. What will most likely happen is the FDIC will seize control and then simultaneously resell the asset to the successful bidder. I think that will happen sometime later this afternoon before the markets open in Asia this evening.
MARGARET BRENNAN: And this will be a faster process than what happened with SVB (INAUDIBLE)?
GARY COHN: It will be – it will be a much faster process.
Now, we’ve been going down this process for the last two weeks or so –
MARGARET BRENNAN: Yes.
GARY COHN: As First Republic continues to be under pressure and continues to lose deposits. Unfortunately, First Republic reported this week that they had a massive outflow of deposits over the last quarter.
MARGARET BRENNAN: So, if First Republic is sold, then the acquirer would take on the deposits.
GARY COHN: Yes.
MARGARET BRENNAN: So, what do you think about the conversation we had earlier with Congressman Khanna about whether Congress needs to do something here? Because it seems like we’re just going into emergency mode now for three banks.
GARY COHN: Yes.
MARGARET BRENNAN: Does there need to be a broader change to the regulatory system and to the laws?
GARY COHN: Well, it’s an interesting question. So, look, I don’t agree with Congressman Khanna that we want unlimited FDIC insurance. I think that, to me, is a bit of a race to the bottom.
MARGARET BRENNAN: You had picked like $2 million, $5 million, $10 million.
GARY COHN: Yes, I mean there’s got to be some limit. At some point you have to limit because you don’t want a total race to the bottom where, you know, the weakest bank with the weakest balance sheet in the world can offer you the highest rate of return on your deposits and therefore you take your deposits there because, guess what, they’re insured by the federal government.
MARGARET BRENNAN: Right.
GARY COHN: That’s not what we want to see. We want to see some type of discipline in the system.
When you talk about more and more regulation, I smiled because if you look at the report that came out that you referenced with Ro Khanna as well, you know, one of the findings in the report is that the regulators did not do a very good job in enforcing the existing rules. So, if you can’t enforce the rules you already have on the books – and it’s hard to enforce the rules because there are so many rules — do you want to create more and more rules when you can’t enforce the ones you already have. Part of me feels like we need to get a simpler, more coherent set of rules so the bank regulators can actually enforce them. And they know what the important rules are.
MARGARET BRENNAN: But the bank regulators here are at the Fed. That’s what we’re talking about.
GARY COHN: They’re at the fed and at the states. Remember, we have state regulated banks and federally regulated banks.
MARGARET BRENNAN: Yes. State – that true. Well, then, that’s a big conversation for California since they just had two banks have some big problems.
GARY COHN: It is.
MARGARET BRENNAN: But Fed Chairman Powell is going to face questions from the press midweek.
GARY COHN: Yes.
MARGARET BRENNAN: They – he gives a press conference around the decision on interest rates that he is expected to be making.
GARY COHN: Yes.
MARGARET BRENNAN: Do you think these banking problems are going to interfere with his plan?
GARY COHN: I don’t think these problems are going to interfere with his plans. I actually think they’re helpful to his plans.
MARGARET BRENNAN: Because they’re slowing the economy?
GARY COHN: So — exactly. What the – what the chair has been trying to do is slow the economy down. He’s been trying to tamp down inflation. Inflation is too many goods chasing too few products. And part of the chasing has been the easy availability of credit. Now that we’ve seen deposits lose the — leave the system, and we’ve seen banks entire financial position, they are not offering loans as easily as they were before, and the loans have become more expensive. So, people are borrowing less money. They have less access to credit. So, their ability to purchase is going down. Purchasing power is waning in the United States, which is exactly what the chairman has been trying to do by raising interest rates. So, he’s, in essence, getting an enormous amount of help out of this banking crisis. Not what he wanted to see happen in any way, shape or form
MARGARET BRENNAN: Yes.
GARY COHN: But the unintended consequence is very helpful to slowing down the economy and tamping down inflation.
MARGARET BRENNAN: So, does it up the odds of a recession being more than mild?
GARY COHN: It probably ups the odds, yes. I mean it definitely ups the odds. It takes control out of the Fed. The Fed is no longer in total control of slowing down the economy. They’ve now got the banking industry playing along with them. But as we’ve seen in the economic data recently, the consumer in the United States still is in relatively good shape. They are starting to run out of savings. The money that they got during Covid, we put an enormous amount of stimulus into consumers’ bank accounts and that –
MARGARET BRENNAN: Both administrations, Trump and Biden.
GARY COHN: Both administrations. Every – every administration put an enormous amount of stimulus into the bank accounts. We see from the savings data that’s starting to wear down, it’s starting to run off. So as that runs off further and further, the economy would become more credit dependent to keep driving. So, I think we will see a slowdown. And I still think we’re in a relatively decent shape. We may have a recession, but I still think we could muddle through the bottom here without a real deep recession.
MARGARET BRENNAN: The chair of the House Financial Services Committee, Congressman McHenry, called the Fed’s report a self-serving justification of Democrats’ long held priorities. He may be venting. It doesn’t look like Congress is doing anything to change regulation or laws related to banking.
There was an FDIC report on the collapse of Signature Bank, which blamed bad management, but it also said regulators just didn’t have enough staff in New York. I mean this — there’s some pretty damaging bits of information in here. If you put aside the politics, the regulators don’t enough staff? They didn’t act? So who are they being held accountable by, unless it’s Chair Powell?
GARY COHN: Well, I — it is Chair Powell. And I think – I think when the chairman goes to Congress – and, remember, he testifies in front of both the House and the Senate a couple times a year — historically all the questions have been on monetary policy. I think we’re going to start seeing a lot more questions on the regulatory policy. How is regulation working? Are they keeping up to what they these to do? Do they have proper staff? Are there issues that are going by that are not being covered? This is a huge finding? I mean this is a bit of a seismic moment because we believe in the United States and I think the U.S. population believes that the banks, where they deposit their hard earned money, are well regulated.
MARGARET BRENNAN: Right.
GARY COHN: And we have found out this week, in the Fed’s own report, that these banks are not well regulated and they admitted it themselves.
I ran a regulated bank. I know that if we would have ever told our regulator that we did not have enough people to regulate ourselves, they would have shut us down.
MARGARET BRENNAN: Yes. Right.
GARY COHN: So, we cannot be in a position where the regulators themselves say, we do not have enough staff to regulate you properly.
MARGARET BRENNAN: You ran one of the biggest banks.
Gary, we’ve got to leave it there.
We’ll be back in a moment.
(ANNOUNCEMENTS)
MARGARET BRENNAN: A search is underway in Texas for a gunman who allegedly killed five of his next-door neighbors, including an eight-year-old on Friday. Sheriff’s deputies say the suspect entered the neighbor’s house firing his AR-15 execution style after they asked him to stop firing the gun in his yard while their baby slept.
Thursday, we spoke with some parents about the impact of gun violence on their children, and we began with a mother who says her biggest concern about raising her young daughter is her safety.
(BEGIN VT)
CHRISTINE (Indiana): We never had things like lockdown drills or anything like that in school. Having her come home when she was even in kindergarten and first grade telling me about this is something that is a little bit concerning to me.
MARGARET BRENNAN: What was that conversation like? How did you talk to her about gun violence?
CHRISTINE: Well, I live in a home where my husband does have firearms, and we’ve learned to use them like respectfully. And there’s a lot of rules and regulations around the safe use of guns. She didn’t really seem very scared about it. She said that, you know, the teachers did a very good job of it. What was concerning to me is just like at such a young age that they’re learning that this could happen.
MARGARET BRENNAN: I know, Scott, you are in Ohio, and, Wayne, you are in Arkansas. I imagine you are familiar with guns yourselves in your communities.
SCOTT (Ohio): Yes. And also lockdown drills. My wife is an early childhood intervention specialist and has been for decades. And I’ve been a substitute teacher. Luckily, we have not had any shooters in those, but we’ve had to talk to our kids and we’ve had to — they’ve had to live through us notifying them that we were locked down in a school and them notifying us that there were lockdown in schools.
MARGARET BRENNAN: Does that cause your children to worry?
SCOTT: They’ve seen us make it through it. And they have understood what the lockdowns were about. Often they were, in my wife’s neighborhood, somebody was shot a couple blocks away, but that’s enough to lock down the school. I think they understand, you know, that there is a risk, but that risk is spread out across the United States and – and even – even with the awful amount that’s happening, the chances of them happening at their very school on that day, they have bigger worries.
MARGARET BRENNAN: Wayne, how much concern does gun violence cause for your children, particularly in school?
WAYNE (Arkansas): With me being ex-military, I’m a veteran, they come to me telling me, we want to learn. My biggest concern is, I have an elementary school here that when everybody’s inside, it turns into a prison. All the gates are locked, all the windows are locked. And I’m kind of concerned about that because if it gets past the front door, they can’t get out.
MARGARET BRENNAN: Scott, I know in your state there was recently a law passed to make it easier for public school teachers to carry guns. Do you think that makes schools more secure?
SCOTT: No. I think that it does quite the opposite. Again, a school shooter is not a common experience. You bring in — guns into classrooms, then you have millions of guns across the nation in classrooms five days a week. You have all sorts of opportunities to create a gun disaster that you wouldn’t have had before they did this.
MARGARET BRENNAN: Show of hands, do all of you believe that mental health is an issue right now and primarily to blame for the gun violence that we’ve been seeing? Raise your hand if you think it’s true? All of you think mental health.
CHRISTINE: I do think it’s a contributing factor, though, especially when you see some of the school shootings with some of the younger individuals. Yes, I feel like we’re not doing enough to stop it from happening.
MARGARET BRENNAN: OK. So, how many of you, show of hands, think gun laws should be more strict in your state?
MARGARET BRENNAN: Scott, you’re the only one who wants your state of Ohio to have stricter gun laws. OK.
How many of you think the federal government can do more to make life safer for kids when it comes to gun violence?
MARGARET BRENNAN: Scott, again, you’re the only one.
Christine, why don’t you think that government can do more?
CHRISTINE: A lot of people think of restricting, passing more laws. And, like, the truth of it is, is that the criminals don’t listen to the laws. If they did, they wouldn’t be criminals.
MARGARET BRENNAN: And, Wayne, when it comes to mental health, you also don’t think there’s something that the state or federal government could do as it relates to the link between mental health and gun violence?
WAYNE: I think the laws that are already on the books need a little bit more human involvement. We need to have more — people that look at what – who’s picking up this gun and what they’re going to do with it.
MARGARET BRENNAN: How many of you are optimistic about the country right now? Raise your hand if you’re optimistic.
Wayne and Scott. Christine, no?
CHRISTINE: I mean, the economy is not great. Some of the relationships with foreign countries are not as good as they used to be. I mean, it’s just – it – yes, I do think like drugs are a big deal to me, the bullying is a big deal. I don’t know, I just — I do think there’s a lot of issues.
WAYNE: I’m a born again Christian. I have a very tight understanding of what that means. I am seeing this country at this moment. In ten years, it’s going to be about the same. They’re making it seem like there’s something going on that’s pulling our economy down. And if we keep thinking that, we will go down. If we change our mindset, if you can shake it off, the sun comes up, you keep going.
MARGARET BRENNAN: Scott, what are you optimistic about?
SCOTT: I’m — it also is related to my church experience. I see a lot of people connecting and still connecting. You know, you see on the media how everything is going down and is just on the edge of falling off a cliff. I think we can pull together and move forward – move ahead.
WAYNE: We’ve got to pull together. Because if we don’t, we will go down — we will go down that rabbit hole.
MARGARET BRENNAN: I like – I like your sentiment that we all need to pull together. I think that’s a good note for us to end on today.
(END VT)
MARGARET BRENNAN: We’ll be right back.
(ANNOUNCEMENTS)
MARGARET BRENNAN: Russian forces fired dozens of missiles and drones into Ukraine, the heaviest barrage in weeks, just as Kyiv says preparations are underway for a major spring counteroffensive.
Our Charlie D’Agata has the latest from Dnipro.
(BEGIN VT)
CHARLIE D’AGATA (voice over): A fuel storage depot erupted into an inferno on the Russian occupied peninsula of Crimea. Russia blamed a drone strike. A Ukrainian official would only call it God’s punishment.
But the heaviest bombardment this country has seen in weeks. Almost two dozen civilians killed in the central city of Uman (ph), including small children. We found residents digging out after a missile strike outside Dnipro that killed 31-year-old Olga (ph) and her two-year-old daughter Veronica (ph).
Her uncle, Sirhi (ph), told us, she was very funny, very clever. We had big hopes for her.
There are no military targets here and it’s nowhere near the front line. Where trench warfare rages on, especially in an around the contested city of Bakhmut. A front line that might be about to expand dramatically as Ukraine’s defense minister announced that the counteroffensive is about ready for launch. His words, just waiting for God’s will and the weather.
NATO announcing that 98 percent of the promised combat vehicles have been delivered. Among them, 230 tanks. But there are serious concerns, part of those leaked intelligence documents over Ukraine’s rapidly dwindling air defense systems, a question we put to senior defense official Alexi Danalove.
CHARLIE D’AGATA (on camera): What can you tell us about that?
CHARLIE D’AGATA (voice over): I can tell you that we are constantly working on this issue, he said. We are in great need of aircraft. We need a new means of anti-air defense if we want to be successful in this war.
Analysts say if Russian fighter jets and bombers are able to operate freely over the skies in Ukraine, it could drastically change the course of the war.
(END VT)
CHARLIE D’AGATA: It’s impossible to overestimate the importance of air defense systems in safeguarding cities like here in Dnipro and the capital Kyiv, where defense officials say 11 missiles and two drones were intercepted in the latest wave of attacks. Margaret.
MARGARET BRENNAN: Charlie D’Agata, thank you.
The struggle for democracy and freedom of the press were the main focus of last night’s annual White House Correspondents’ Dinner, in a Washington ballroom packed with journalists, politicians and celebrities.
The president did get some laughs as he made fun of his age and when he took some swipes at Republicans and conservative leaning media outlets. But his tone was sober when he called for the release of wrongfully detained journalist Evan Gershkovich of “The Wall Street Journal,” currently imprisoned in Russia, and Austin Tice, who’s been held in Syria for 11 years.
(BEGIN VC)
JOE BIDEN (President Of The United States): Journalism is not a crime. Evan and Austin should be released immediately, along with every other American held hostage or wrongfully detained abroad. Paul Whelan, unjustly held in Russia for more than four years.
They are not forgotten. And I promise you, I am working like hell to get them home.
My commitment is to bring them home. Just as I know your commitment is to continue to be a free and fearless press. And that’s what we honor tonight.
You make it possible for ordinary citizens to question authority.
The free press is a pillar, maybe the pillar, of a free society, not the enemy.
(END VC)
MARGARET BRENNAN: The president’s remarks are usually the highlight of the event, but last night there was one guest in attendance who stole the show.
(BEGIN VC)
JOE BIDEN (President Of The United States): I’ll never give up on hope. Things can get better. Things can turn. Things can change.
Tonight, unlike last year, Brittney Griner is here with her wife, Cherelle. Brittney, where are you, kid? Stand up. Come on. I love this woman. It’s great to have you home. And, boy (ph), I can hardly wait to see you back on the court, kid.
(END VC)
MARGARET BRENNAN: Griner is now using her public platform to advocate for Americans who are wrongfully detained, including the family of Ahmad Shargy and others held for years in Iran.
We’ll be right back.
(ANNOUNCEMENTS)
MARGARET BRENNAN: This programming note, our CBS News streaming daily political broadcast “Red and Blue” is going to get a new name and a new look. “America Decides” premiers tomorrow and airs starting Monday at 5:00 p.m. Eastern, with second runs at 6:00 p.m. and 9:00 p.m. Eastern. As for us, until next week, for FACE THE NATION, I’m Margaret Brennan.
(ANNOUNCEMENTS)
