Morning Joe - Fed raises interest rates for the first time since 2023

Episode Date: September 17, 2026

September 17, 2026: 8am — Fed raises interest rates for the first time since 2023 To listen to this show and other MS podcasts without ads, sign up for MS NOW Premium on Apple Podcasts. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Welcome back. The Federal Reserve has voted to raise interest rates by a quarter of a percentage point, marking the first rate hike since 2023. The increase was approved unanimously by the Fed Board yesterday with an indication that another hike is to come as part of an effort to combat inflation, largely being driven by high oil prices, which of course have been brought on by the war with Iran. The central bank's chairman, Kevin Warsh, defended the decision, saying the plain fact is that inflation, is too high and has been for too long. President Trump, meanwhile, stood by Warsh, but lashed out at the Fed as a whole. I told, I talked to Kevin, and I said, you might as well vote with the board because it's not going to matter. The board is very hostile, they're very political, they're doing the wrong thing, there are a bunch of politicians or people put on by politicians. I said, do what you want, because it doesn't matter because he doesn't have the votes. No matter how good a job, he's a good man, Kevin Warsh. But, No matter how good a job, he's got a hostile board.

Do you think he made the decision he made how much he's stolen on? Well, I don't know what he was referring to, but I will tell you, interest rates are too high. Interest rates are artificially high. Interest rates in the United States should be 1% or less, because we are the best credit in the world by far, with all that money pouring in. Our country is booming with new investment more than anybody else ever. and if we stop trading with every country that we have a deficit with, which is most of them, and which would be very easy to do, would make at least $1.5 trillion a year.

Trump has that part about trade entirely wrong. Most economists say the move by the Fed was, in fact, the right decision. Former economic advisor to Trump, Stephen Moore, said yesterday that if he were on the board, he probably would have voted for this rate hike. And again, another is expected. We'll see how long Trump stays patient with Warsh. Up next year, I'm Morning Joe. We're going to dig into the latest alarming report on artificial intelligence acting on its own.

Morning Joe, we'll be right back with that. We've been talking a lot on the show in recent days about worries about AI. Well, here's a new thing to worry about. In a new blog post, the artificial intelligence company OpenAI says it found six new instances in which, its models hid mistakes, made up data, or move files onto the internet, all without permission. The company revealed what it said was the, quote, unexpected or concerning behavior of its AI models as part of a new framework for reporting misalignment, which is the idea that models are not pursuing outcomes in line with human interest.

In the post, OpenAI says two of the main instances of misalignment, which is the idea of misbehavior include the technology inserting instructions to future versions of itself, to, quote, conceal mistakes from the user, while another instance involved an internal-only model using a leaked identification key without authorization and then fabricating data. The disclosure comes amid mounting pressure on AI companies to take model misalignment and safety far more seriously. On Saturday, OpenAI CEO Sam Altman endorsed calls to slow down the rate of model progress, which came amid several other industry researchers also sounding the alarm about AI's growing potential to cause catastrophic harm and even threaten the existence of humanity. There seems to

be a growing sense in Washington to do something, but President Trump, at least so far, not listening. Up next year on Morning Joe, longtime Republican strategist Carl Rove explains why he's voting for a Texas Democrat this November. We're going to read from Roe's new piece for the Wall Street Journal. Plus, Democratic Senator Chris Murphy

of Connecticut standing by, we're going to talk to him about those emerging threats posed by AI, as well as a Senate bill to regulate college sports. Morning Joe continues in just a moment with all that and more. There is no more prestigious race,

Forrest. Then the America's Cup. America's Cup. This is the holy grail for big boat racing. The oldest trophy in international sport is about to take on a new look. There hasn't been a

battle of the sexes like it since the 70s. For the first time in the history of the America's Cup. On paper, just to make sense. An all-woman crew. Nobody believed we could do this. We'll compete against the Met. That was the dumbest idea I ever heard.

And we were like, yeah, watch this. That was a look at the new film Mighty Mary, which is about the incredible true story of the first all-women's crew to contend for the America's Cup in 1995. The team was initially dismissed as a publicity stunt, but it went on to compete at the highest level of the sport. Break barriers and defeat four-time America's Cup chance. champion Dennis Connor before a controversial decision ultimately changed the outcome.

The story remained largely untold for nearly 30 years. MS now contributor Huma Abedine spoke with the award-winning filmmaker behind Mighty Mary, Mary Mazio. Mary, it's great to have you with us. This story, these pivotal races, happened more than 30 years ago. What made you say I have to tell this story now? Well, interestingly enough, I had been on the Olympic team with a number of the grinders that jumped aboard Mighty Mary. And this was the Olympic rowing team. And so I was aware of when this was happening.

And I remember thinking at the time, what an amazing story. It's got more twists and turns than a murder mystery. It's an extraordinary groundbreaking event where men and women went toe to toe. in the same arena, no short course, no handicap. And what was remarkable is you had this group of rookies going up against the best athletes in the world, the best male athletes, the most seasoned crew. So it was just an exciting story from the get-go. And what struck you most when you reconnected with these women three decades later and heard

them tell their side of things? I mean, you look at these grinders on screen and it's just, it's awe-inspiring. It's awe-inspiring. That is 100% for sure, Huma. And I think what was remarkable is that the emotion is as high today as it was back then. I think the real interesting piece about this and what really surprised me was what the men brought and the nuance that they shared in the film, which makes the film so timely. When you have hostile adversaries, competitors, you overlay gender on top of that. And then 30 years later, you have male sailors reflecting on the time. This was the 90s. And you have people like Paul Khaard say something to the effect of, you know, as we evolve, we really need to move away from what our fathers are teaching us and lean in towards what our sons are learning.

What a beautiful sentiment and one of like the power of sport in unity. It's really incredible when you listen to those testimonials the men have in the film. Now, the America's Cup returns in 2027 with a new rule requiring that every team have at least one female sailor. Is that a full circle moment for you? Oh, my goodness. It's a triple circle moment. And I'll tell you, Huma, what is so exciting, the film has just come out. It's in select AMC theaters right now.

And what's amazing is we were contacted by the America's Cup institution itself for so long, so resistant. to change, so male, of course, and they will be ushering in the 38th running of the cup with Mighty Mary. And so we're headed to Italy. Actually, it's next week. And what a remarkable testament and validation of the importance of this legacy of this team. That is extraordinary. It was wonderful to hear about Mighty Mary. I was going to ask where Mighty Mary was for the past 30 years. But what do you hope people particularly women walk away from this film, understanding about what it takes to break into a space that just wasn't built for you? So I have so much to share on that, but I was contacted by a surgeon who had just seen the film. And she said, for so long I've been in a male-dominated profession trying to figure out how I behave, what I say.

And she said, your film reminded me, I belong. What a beautiful sentiment. And really the overall message here is that talent is everywhere, strength is everywhere, intelligence is equally distributed. It's access and opportunity that are not. And so for any little girl out there where something looks so remote, so audacious, I feel like an imposter, I feel like I don't belong, sometimes magic can happen if you just try. Well, the film highlights, the pivotal moment in the film is the big surprise, the controversy around the race and the outcome being not what we expected. Give us a, how did that play out and what ended up happening? Well, there were a couple of controversies.

And I think most noteworthy is really fascinating. And that is when you think you've got a set of rules and rules are shift. or changed at the last minute. That's a really interesting examination of who may hold the levers of power. And certainly you have to watch the film to see what happens, but there was an unexpected change. You know, the women, they took down the king of sailing. And it's so remarkable that you have this group of rookies, women that were able to,

as I said before, compete with the best of the best, and they took down the king. Dennis Connor, board time, America's Cup, Mr. America's Cup. and yet he was able to off the water figure out a way to get back into the race. It's a fascinating examination of so many different issues, right? Who holds the keys to power? Who gets to change the rules? And boy, it was a rude awakening, not just for the women, for many of the men who were also competing at the time.

So, yeah, thank you for that. A rude awakening, but an extraordinary tale. Mighty Mary is out now and select AMC theaters nationwide. Mary Mazio, thank you for making this film, and thank you for joining us. Oh, thank you, Huma. Thank you for having us. Appreciate it. Welcome back.

Longtime Republican strategist Carl Rove has a new piece in the Wall Street Journal titled, Why I'm Voting for a Texas Democrat. In it, Roeve writes about how Beau French, the Republican candidate for Texas Railroad Commissioner, marked the Texas Longhorn's dramatic win over Ohio State last Saturday. Rov writes in part this. He, meaning Bo French, posted a picture of screaming, joyous, celebrating burnt-orange-clad students. Referring to students who appeared to be South Asian or Hispanic in the photo's foreground, French declared, I heard UT graduation this year looked like this. I didn't believe it. The problem is now obviously far worse than anyone imagined.

Mr. French's not-so-s subtle claim that UT has too many Hispanics and, South Asians. He later said his issue is too many, quote, foreigners is raw, uncut bigotry. This isn't the first time Mr. French has made bigoted comments. Mr. French also has problems with non-Christians. I'll have no part of it. This November, I'll vote for only the second Democrat in my life, Mr. French's opponent, John Rosenthal. The GOP stables need a cleaning. This is a good place to start. It's worth noting Republican Senator John Cornyn of Texas quoted that last sentence from Roeve when he reposted the piece last night on social media. And Joe, Carl Roeb, obviously, longtime Bush strategist, but for him to draw the line saying this is bigoted, this is racist,

I can't stand for it. The GOP needs to look itself in the mirror. It is, but if the sameble needs to be cleared out, it's not the politicians that put the horses in there. It's the people. They had a chance. to put Cornyn in. Republican primary voters could have voted for John Cornyn, this race would have been over. As good as Talarico is as a political athlete, and I think Republicans still are underestimating just how good he is out there on the campaign trail. He wouldn't have gotten close, I don't think. It may have been three, four, five points, but John Cornyn would have won that race.

And Republicans wouldn't have to be spending tens of millions of dollars there. You look at both, whether it's Boat French, you look at all of these things. There's something wrong. There's a deep right in the Republican Party in Texas. And yeah, we can look at Ken Paxton. He's just as corrupt as they come. But we also have to look at the Republican Party in Texas under Donald Trump in the direction it's gone. It's self-destructive. It's insular. And it's going to lead to a lot of wins if they're not careful. Yeah, Democrats believe they have some hope in Texas for at minimum, as you say, such an expensive media market. And they're going to have to, the Republicans are going to spend a lot of money to defend what should be pretty safe seats. joining us now, Democratic Senator Chris Murphy of Connecticut, as well as MS now Senior Capitol Hill Reporter and the host of way too early, Allie Vitale. Our thanks to you both for being with us. Senator, start with you. We just, I moment ago read more worrisome headlines about AI and how Open AI saying that some of theirs programs now were like hiding up their mistakes. They're trying to learn. Again, misalignment is the word. This comes on the heels of frankly, apocalyptic warnings from many in the industry. saying that AI needs to be regulated. There needs to be some sort of safeguards. And we're seeing a moment where Democrats and Republicans, though not the Republican in the White House, seem to be agreeing. Well, listen, I hope we can find agreement, but that seems a bit far off right now. You know that

the president has basically said he has no worries about all of these dire warnings from the AI companies that their models are starting to essentially break containment. But, Speaker Mike Johnson also parroted the same line just a few days ago. He said, I don't think Congress has any role here. The industry just needs to take care of it themselves. The fact of the matter is the industry cannot take care of this by themselves. They have one main incentive, which is to put this technology onto the market as quickly as possible. And if one company throttles back and a competitor doesn't, they will lose their company because their investors will abandon

them. So what you need is a set of rules that applies to everybody, a set of rules that forces these companies to be much more careful about how they commercialize this technology. And right now, between Donald Trump and Mike Johnson, there seems to be a blockade in Congress on passing any common sense regulation. Maybe that will change in November. And if it does, then I think one of the first orders of business for us in January is going to be to put some common sense restrictions on these really dangerous technologies. Ali, over the last two weeks, we've had a pretty extraordinary run of events regarding AI and a growing awareness by Americans.

John Lemire and I were talking about on Monday that throughout the weekend, wherever we went in social settings, sports events, people were talking about AI. They were deeply concerned about it, so much so that you understand that Republicans and Democrats are hearing this from their constituents. I wonder how much that's filtering down on Capitol Hill, other than what? we're hearing from Mike Johnson who simply parrots what Donald Trump says. It's filtering down, but I don't think the renewed urgency is actually going to spur any action. And I think that's one of the difficulties with when the conversation doesn't match the legislating around Capitol

Hill. But Senator, you and I were having the conversation, frankly, just a few minutes ago about the ways that voters are talking about this. And I think whether this is a problem that is left unsolved in this Congress and push to the next one, the thing I keep thinking about, is you're one of the senators who talks about using AI, you're a cloud user. Yeah. If I've heard you correctly in the halls. There are other senators, though, who seem to barely understand the technology. One of them said I use Control H when they were asked about AI.

I don't even know what that means. So I guess the question I have before Congress can even get to the legislating is how do you legislate something that some lawmakers don't even seem to understand? I don't know. I don't know. And it might be. And you and I don't know about it. Right? So, listen, politics always takes a year or two, sometimes four or five to catch up to where the public is. And I just finish this thing that I do every year where I walk across the state from one end to the other. I just spend every day sort of bathed in sort of where people are. And this year, everybody was talking about AI because they've been dealing with it for years. 70% of kids right now are using these chatbots for advice and social connection. Parents who are sending their kids off to college are like, why

I doing this because which jobs are going to be around four or five years from now? So this is an everyday conversation for folks. And it will be the dominant political issue in 2027 and 28. I think the Republican Party for now has taken this position that we're going to do nothing. But I think voters are not really sure that Democrats are willing to step up and make this a priority issue. So in the next 30 days, as we go into this election, Democrats have an opportunity to basically put AI on the ballot. And I think if we do that and make clear that we will, for instance, ban these chatbots for kids, that we will put common sense regulations around data centers in these new models.

I think there'll be a real response at the polls. You know, the senator said something really important, John. I've said it on this show now for some time, you know, over the past 10 years when we would have people over at our house for dinner. A lot of them, Democrats, most of them Democrats, you know, they would be talking. It used to be in 18, 19, 1920s. They were complaining about their children in college being afraid to speak in class because things had gotten so woke that they could be canceled. And so they just kept their hands down. They played it safe and it wasn't a good learning environment.

Those parents now are complaining about the fact their children who went to some of the best schools on the planet can't find jobs. And so when Senator Murphy talks about the job problem, this is a massive problem. And we're going to feel it at the polls. it's going to be an earthquake in 26 and I think especially in 28th, but I want to look really quickly, Wall Street Journal's story today. There is a divide inside the White House. Susie Wilds, again, not happy when David Sachs got Donald Trump

to completely abandon any idea of regulation on this. And also Scott Besson has the concern, thank God, that I have, which is our banks, our banking accounts. They're all computerized. Scott Bessett knows. if you have major banks that are attacked by AI, I mean, it's going to be financial chaos. It's going to be a meltdown that makes September 15th look like a spring shower.

Now, there are real concerns. And certainly there is a divide in the White House. I reported earlier this week in the Atlantic on similar lines. Susie Wiles, Scott Besson, pushing for at least some regulation, some sort of take a breath here. But others, David Sacks, pushing to, the other direction, but some of Trump's outside advisors that still have his ear from time to time. Steve Bannon, Elon Musk, those two don't agree on much.

They also say there needs to be at least a little bit of a slowdown here. Elon Musk has been talking about the possibility of civilization ending since 2014. We'll see if he brings it up at next week's summit with Xi Jinping in China. The president seems to prioritize AI's role on the stock market, at least for now. Senator, we also want to turn to this. You're opposing new legislation that would impose sweeping new standards across college sports. Talk to us about the so-called Protect College Sports Act and why you're against it. Yeah, I mean, listen, this is a piece of legislation that seeks to preserve the exploitative model of college sports.

Now, first of all, I'm not sure why Congress is debating the issue of college sports right now. We have a war that is out of control in the Middle East. We have gas prices that are soon going to be $6 a gallon. Like, this seems to be the last issue that Congress should be dealing with. It shows how out-of-touch Republicans are. But if we are going to deal with this issue of college sports, I just don't think we should return to a day when coaches and schools could exploit athletes and pay them far less than they are worth.

This legislation essentially arbitrarily caps the amount of money that athletes can make. And I think what will happen is that it will end up actually destroying college sports because these kids, especially football players that are forced to play three years of football and go through all of this potential brain injury are not going to stay in college if they aren't able to make money. They're going to find some other outlet to be able to get adequately compensated. So to me, this system that we have today is at least a little bit more fair than it was 10 years ago. Players have more rights to get compensation. And I think by Congress stepping in and micromanaging college sports and artificially restricting the compensation of athletes,

it's not going to save college sports in the end. It might actually destroy the, I think, a product that Americans know and love. So I want us to go back to the drawing board and build a bill that is fairer to athletes. I think that actually will be good for college sports in the long run. But it doesn't seem, at least when this comes up next week, and I look at the way that the vote on the procedural has gone, it looks like this thing could pass. Yeah, we'll see. I mean, there's a whole bunch of Republicans that voted for the initial procedural,

motion that may vote against the bill in the end for a totally different reason. They want there to be a provision attached to this bill to ban transgender athletes from playing sports writ large. So I don't think this has smooth passage. All the player groups are opposed to it. The NWACP is opposed to it. The unions are opposed to it. All the groups that traditionally look out for the disenfranchised and the disempowered are telling us this is a really bad bill for these athletes. So yeah, it's looking like it may pass, but we're going to continue to fight it and try to get something better. And we'll be staying on the storyline in the days ahead. Democratic Senator, Chris Murphy of Connecticut, Senator, thank you for joining us.

We really appreciate it. Ali Vitale, thank you as well. That does it for us this morning, but fear not. We're back tomorrow at 6 a.m. Eastern for another morning. Joe, money, power, politics, Stephanie Rule. Up next, just two minutes.