Morning Wire - Bracing for Recession | 6.3.22

Episode Date: June 3, 2022

Experts tell Americans to brace for economic “hurricane”, some cities say they won’t enforce anti-abortion laws, and the humanitarian crisis at our southern border. Get the facts first on Morning Wire. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Two of the CEOs of the biggest banks are warning Americans to brace themselves for a massive economic downturn. It's a hurricane. Right now, everyone thinks the Fed can handle this. That hurricane is right out there down the road coming our way. So you better brace yourself. How are inflation, supply chain problems, and high energy costs contributing to a likely recession? I'm Daily Wire editor-in-chief John Bickley with Georgia Howe. It's Friday, June 3rd, and this is Morning Wire. In anticipation of Roe v. Wade being overturned, many blue cities are saying they won't enforce laws that limit abortion. And a record number of migrants have died while trying to enter the U.S. illegally. This is one of the worst humanitarian crisis I've ever seen, certainly the worst in this hemisphere,

people putting their lives in jeopardy. We discuss the human toll of the border crisis. Thanks for waking up with Morning Wire. Stay tuned. We have the news you need to know. This show is sponsored by the Pearl Source. June is officially Pearl Month, and there's no better time to buy beautiful and timeless pearl jewelry for that special someone in your life from the Pearl Source. The Pearl Source cuts out the middleman by eliminating those crazy markups by jewelry stores

and sells directly to you at up to 70% off retail prices. The Pearl Source offers free, two-day shipping on every order and a 60-day money-back guarantee with free return shipping, so it's risk-free. For a limited time, Morning Wire listeners can take 15% off your order with promo code Morning Wire. If you want fine pearl jewelry at the best prices online, then go superiors. straight to the source, the pearl source. Amid skyrocketing energy prices and record inflation, J.P. Morgan Chase, CEO, Jamie Diamond,

is warning Americans to brace themselves for a coming economic hurricane. Joining us to discuss is Brandon Arnold, executive vice president of the National Taxpayers Union. So, Brandon, we've got Jamie Diamond sounding the alarm pretty intensely this week over an economic hurricane, he says, is definitely coming.

Is he correct? I kind of share Jamie Diamond's concerns here going forward because there's no relief in sight when it comes to inflation. I think the supply chain problems have persisted much longer than we anticipated. The conflict in Ukraine is obviously driving this. As are some domestic policies, we've certainly made a few mistakes here, more than a few mistakes, you might say, domestically speaking. So we're going to see sustained inflation for the near term. and once we start to see consumer spending fall, and I think that is quite likely given some of the initial signs that we see,

savings rates declining, people starting to tap out of their reserves, their savings accounts, we are potentially going to be moving into recession territory, and that's a very concerning thing that's going to have rippling effects across the economy for people of all income levels. Now, one of the troubling data points we've seen recently is that even households with very high average incomes, as high as $250,000 or more a year, are often now living paycheck to paycheck. What's that a function of? That's a function of everyday costs, just rising. Inflation doesn't just impact lower income Americans, though it tends to hit them harder. It impacts

everybody, and we're seeing housing costs, for instance, go through the roof. So these additional costs that people are putting on their monthly expense list has started to consume a larger and larger share of their paychecks. And as that's happening, we're seeing savings rates decline. So we're seeing people transition from a position where they are tucking away money each and every month to a position where they're dipping into their savings just to cover their routine expenditures. That's a real danger territory because if we do indeed see a recession, and I think it's quite likely that we will. Once those reserves are depleted, people end up in really, really tough economic circumstances when they can't afford to cover rent.

utilities, groceries, their regular expenditures. Now, the Fed is taking action in an attempt to tamp down inflation. Are they taking the proper steps to address these issues? Yeah, I mean, the Fed is embarking on the path at ought to. I think that's moving interest rates back to historic averages. You know, that is a policy that can fix some problems but create other problems, particularly people who are in retirement who may see less return on their retirement savings, people who are looking to sell their house. Those people may get a lot less return on

those investments than they anticipated, and it may put them in a difficult place financially going forward into retirement. So there are costs and benefits to every public policy. I think the goal here for the Fed should be to act in a very gradual, measured fashion, rather than trying to overcorrect for a circumstance that obviously requires some quantitative tightening. With what we've experienced over the last few months and what we're facing in the coming months, is this unprecedented? Have we ever experienced anything like this? I think we're on pretty new territory here.

It's very different than anything. Certainly I've experienced during my professional life to see inflation rates sustaining around 8 or so percent, to see fiscal imbalances for the federal budget that look really, really disastrous. President Biden talked about reductions in the deficit in the cost. current fiscal year. And while he's right, what he's missing is the forest for the trees, because we're looking at 10-year estimates coming out of the Congressional Budget Office, this shows some of the highest debt our country has ever had in terms of debt-to-GDP ratio. And I don't really see a lot of sentiment from this Congress that that needs to be addressed

as quickly as I'd like to see it address with more fiscal austerity, spending reductions. You know, we need to have a very different mindset when it comes to spending and balancing the federal budget. I do appreciate that Biden has at least provided some lip service there, but I would like to see some more concrete activities because I think that would go a long way to stabilizing our economy. Well, a lot of Americans are indeed bracing themselves for some turmoil. Let's hope we see measured policies here. Brandon, thanks for your insight. Thanks so much for having me. That was Brandon Arnold, EVP of the National Taxpayers Union. Coming up, Democrat-controlled cities in red states are declaring themselves

sanctuary cities for abortion. You can get this show and all of the content you love wherever you are, all on the Daily Wire app. Even if you're not a Daily Wire member, you'll be the first to know what's trending with mobile notifications for the latest news and you'll get content from all of your favorite Daily Wire shows. Download the Daily Wire app and keep up with the facts

no matter where your day takes you. With the Supreme Court expected to overturn Roe v. Wade this month, a growing number of local governments in red states have preemptively declared themselves sanctuary cities that will ignore or circumvent any abortion restrictions passed by pro-life legislators. Here with more on the growing movement and the legal ramifications is Daily Wire's senior editor, Cabot Phillips. So Cabot, what do we know here? What exactly is a sanctuary city for abortion? Yeah, it's important to remember that if Roe is in fact to overturn this month, as we expect,

each state will be able to set their own laws regarding abortion, meaning in many Republican states, access to abortion would be either greatly rolled back or restricted almost entirely. In response, Democrat-controlled cities and more liberal pockets of those states have preemptively declared themselves sanctuaries from pro-life legislation. Essentially, they're saying that they'll refuse to enforce any bans on abortion or even punish those in their city who break state law on the issue. Now, where are we seeing these sanctuary cities? Really, any red state that has Democrat-controlled cities or counties, for example, in Fairfax, Virginia, the county prosecutor there announced that even if the state passes pro-life measures, quote, I will not prosecute a woman for having an abortion or being suspected of inducing one. We saw a similar announcement from the district attorney of Georgia's DeKalb County,

who said if the state's heartbeat law went into effect, that she'd refuse to prosecute those seeking or providing abortions. We also saw similar announcements in Durham, North Carolina, New Orleans, Austin, Texas, and even here in Nashville. And what about the legal side of this? Yeah, that is the big question right now. It's hard to answer, mainly because Roe hasn't yet been over. turn, so we don't yet have the specifics on what exactly things would look like or how they

would be enforced. One thing we can do, though, is look at similar examples of cities refusing to enforce state or federal law, most notably on immigration. We all know about sanctuary cities for immigration. On that front, numerous states, including California, New York, and Oregon, have cities where local governments just refuse to cooperate with federal law enforcement agencies, especially ICE. They've more or less been able to get away with it, but it's likely going to be more complicated on abortion. That's at this point sort of uncharted territory because for the last 50 years, Roe has been the law of the land. So the short answer on whether these sanctuary cities are legal is we just don't know yet. I hate not to give you a more clear answer. So shifting gears a bit,

how popular would these measures be? What do we know about public opinion on Roe right now? It's really interesting on that question. If you look at polling on Roe itself, America would seem to lean pro-choice. But if you look at polling on abortion itself, America seems much more pro-life. For example, most polls show the majority of Americans do support Roe staying in place. One Gallup poll this week had it at 58 percent. Another NPR poll the week before had it at 64 percent saying it should not be overturned. So you'd think that would mean that most Americans support abortion up until roughly 24 to 28 weeks of pregnancy. That's what Roe currently allows. But that's not what the data says. In an aggregate of recent polls, just 28 percent of Americans say

that abortion should be allowed after just 14 weeks. So half of what Roe currently allows. That means that the strong majority of Americans actually oppose the abortion laws that most Democrat states say they'll implement if Roe is overturned. Cabot, thanks for reporting. That's Daily Wire's Senior Editor, Cabot Phillips.

Amid record-level illegal crossings, a congressional delegation recently went to the southern border to survey the conditions. While there, Senator Roger Marshall, a physician, gave medical assistance to a woman who nearly did, died from dehydration. Marshall called the situation on the border an unsustainable humanitarian crisis,

leading many to a pine that for all the criticism directed at Donald Trump's border policies, the humanitarian crisis under Joe Biden may be worse. Here to discuss as columnist David Marcus. Good morning. Do these critics have a point? Morning. They absolutely do. According to the United Nations, 650 migrants died trying to cross the Mexico-U.S.

border in 2021. This was an all-time high and simply a tragic loss of human life. And it does seem to be the case that many Democrats, the same ones who demonize Trump over separating families and building walls, are very quiet about the devastating situation on the ground today. Now, with the Republicans criticizing Biden's border policies, what, what do they point to as his mistakes they say are fueling this crisis? Generally speaking, they argue the administration's lax border policies have been a magnet, drastically increasing the number of people who attempt to enter the country illegally. Both Biden and his border czar, Vice President Kamala Harris, have somewhat quietly urged migrants not to come. But their actions and policies have sent an accurate message that there's a

very good chance that these migrants will just be let in, as many as a quarter of a million a month at times. And that flood of humanity is just more than border officials can handle. Right. We've seen reports about the overwhelmed border agents. The concerns being raised now are not just about the safety of the migrants, though, of course, that's vitally important, but also the safety of Americans. What are some of those concerns? Well, there's quite a few. When I was in Del Rio last year, just after the 15,000 Haitian migrants had camped under the international bridge there, I spoke with residents who regularly had migrants streaming over their property, putting them in real fear. And of course, you know, along with migrants, the cartels are bringing drugs, especially fentanyl into the United States, which is feeding the spike and overdose deaths. Yeah, we've looked at those numbers and they're staggering. Yeah, they are.

Finally, a lot of these are very small towns. You know, blink and you'll miss Del Rio. These communities just aren't prepared to handle this influx. Now, even though a judge ruled against the White House on Title 42, the president still wants to repeal it, which experts say will make the border crisis even worse. What's the Biden administration going to do to, address all these concerns? I mean, the answer is really not a whole lot. The administration's position

is outlined by Department of Homeland Security Secretary Alejandro Mayorkas is that the laws are being enforced, and it is Congress, not the White House, that needs to find solutions to our immigration situation. But Republican critics are quick to point out that Biden has not been shy about using executive orders to achieve policy gains. Why he is unwilling to do so here, even in face of this humanitarian crisis, it's unclear. Are there any signs today the situation is improving or that there's efforts underway to curb the human toll of it? Not much.

The stay of the reversal of Title 42 was a win for border hawks and the agents tasked with controlling the flow of migrants. But that Trump-era policy is the status quo, so reversal won't change anything. But since very early on, the administration has reversed many Trump-era policies that they saw as inhumane, ironically. many of these decisions have made the problem worse and there are really no signs that it's getting better. Well, it's clear that what's happening now is unsustainable, so we'll see if the administration responds. David, thanks for joining us.

Thanks for having me. That was Daily Wire contributor, David Marcus. Thanks for listening to Morning Wire. We created this show to bring more balance to the national conversation. If you want to join us in our mission and help us climb the charts, consider subscribing, leaving us a five-star rating. and most importantly, sharing our podcast with a friend. Well, that's all the time we've got. Thanks for waking up with us.

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