This morning. Im maria bartiromo. It hope youre having a good tuesday morning. It is tuesday, march 12, you 7 00 a. M. On the button on the east coast. Time for the hot topic of the hour. President biden unveils a 5 andahalf trillion dollars of new and higher taxes package in his massive 7. 3 trillion, 2025 budget. Taxpayers are Stuck Holding the bag after all of the president s spending led to 40 year high inflation. The wall street journal reporting that more americans are treating their 401ks like cash machines. A record share of account holders reportedly taking early withdrawal from accounts last year. Credit card debt is now at a record high of 1. 3 trillion but the president continues to tout his economy. Watch. 15 million new jobs creat, thats a record, growth is strong, wages are rising, inflation is down, we reduced the federal deficit. Inflation keeps coming down, Mortgage Rates will continue to come down as well. Maria luke, the committee for a responsible federal budget is Fact Checking the president in that state of the union address, he said i cut the deficit by over 1 trillion, the Committee Says that is false. More than the entireity of the fall in the deficit can be explained by the covid relief money going away. Here youve got individuals tapping into credit cards increasingly, your reaction. 1 trillion of new debt added, every 100 days, that doesnt sound like deficit cuts to me, right . The thing is about the tax cut, i think it was 1862 taxes and federal Tax Income Tax came out for first time at a rate of 3 . Now y were at 12 . Biden wants to raise it, it will be passed on to everyone. The Corporate Taxis at 21 . Biden wants to raise it to 28 . Everyone pays too much in taxes. Thats going to hinder the economy. With regard to Credit Card Debt, 20 of lenders dont think theyll buy a home, 70 of gen z doesnt think theyll be able to retire. This is called doom spending. If no one thinks theres a future, theres no point in saving to buy a home, no point lot of people arent getting married, arent having kids. Theyre spending selfishly on themselves, traveling, and thats contributing to all of the spending and earnings which is contributing to the stock market rise as well but that being said, its not sustainable. In the end, its only sustainable if you can keep your job. If we have cracks in the labor system things will break and dominos will start to. Mto fall. Maria how do you this and investors react to the proposals, increasing the corporate alternative minimum tax to 21 , now at 15 . Quadrupling the stock buyback tax to 4 , thats up from 1 . Raising the Corporate Income tax as you said to 2 28 up from 21. Theres a 25 billionaires tax, if you are a billionaire you have to pay at least 25 and theres longer depreciation and higher fuel taxes on private jets. Impact. This whole thing is weaponizing the tax code. Democrats are weaponizing it to try to get votes, trying to say you have to pay your fair share. Its not about paying your fair share. Its a culprit of the government getting bigger over time. Since we started income taxes if they the first place, since we started Corporate Tax in the first place, its an excuse for the government to keep spending money so they regards to the stock market if we raise taxes, the governments going to continue to deficit spend, spend trillions of dollars. As long as the government keeps stimulating the economy the markets will like that and a thats going to offset taxs in the short term but its not sustainable and the question becomes when does the bubble burst. Maria by the way, all of that doesnt include the taxes that you may have to pay on paper, right, like if you own a stock and its gone up and youre up on paper, for the year, youll pay taxes on that which is just so outrageous, i think. You havent even sold it and realized the gains but how about this, snickers is speaking out. Theyre denying the president s state of the union accusation that snickers reduced the candy bar sizes, snickers writes this in statement to cnn, we have nt reduced the size of snickers in the United States like many industries, we continue to face high inflation and spikes in material costs so there you have it. Snickers says its just not true. Poor snickers, maria, slandered by bidens economic incompetence. You know, shrinkflation has been his favorite hobby horse lately but its a gimmick term he invented to effectively absolve himself of any responsibility in inflation which is still saddling average americans across households commodities, blaming companies for misleading consumers, really . I wish he would crack down like you alluded to against run away federal spending that contributed to the price surges rather than companies and back to the Credit Card Debt surging. That suggests that he despite the biden administrations victory laps on inflation, that people are mortgaging their futures to afford today. That doesnt signify Economic Health to me. Maria cheryl, how do you see it . First off, the term shrinkflation has been around for a while. Hes trying to own it. I think hes going to fail because this is not what anybody is talking about when it comes to how theyre going to vote in november. Remember, this is all political at the end of the day. I want to go back to something about this budget. We finally get the details on President Bidens budget and it really is just a rerack of proposals interest a year ago. Its not going to go anywhere. House republicans have proposed their own version of a budget where theyre cutting trillions in spending, 14 trillion to be clear, not trying to boost spending. New york poste post says it the, joe biden says he cant be trusted with your dollars and they talk a about the fact that in the budget you see all this money going to Climate Change, to wind farms and then of course the handouts for Student Loans and the leg up and the one thine budget i didnt have a problem with, a little bit of a leg up for first time home buyers because theyre struggling to be able to qualify for a loan but overall, is this going to go anywhere at the end of the day . No. But its a great political wish list, maria. Maria were just Getting Started this hour. Quick break and then how markets are on the move ahead of the cpi, coming out in an hour andahalf. The word on wall street panel is here to weigh in. Dont miss it. Youre watching mornings with maria live on fox business. Well be right back. woman what if my type 2 diabetes takes over . What if all i do isnt enough . Or what if i can do diabetes differently . vo now you can with onceweekly mounjaro. 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Maria welcome back. Time for the word on wall street, top investors watching your monday. Joining me is ubs wealth management, Senior Vice President , bren brenda oconners and luke lloyd. We are awaiting the big number coming out in an hour and 15 minutes, dow industrials down 19, nasdaq up 66 and well get the cpi coming up in one hour and 15 minutes kohls earnings crossed a moment ago, reporting a double beat but it the did post a smaller than expected decline in quarterly sales, helped by holiday discounts. Sticks up better than 1 right now, tomorrow well get dollar tree and well get Dollar General and Dicks Sporting Goods on thursday, how do assess earnings so far and the Retail Sector in particular . So maria, we know that q4 has been a stellar earnings season. When it comes the retail sales, expect the value chains, the brands in the lower space to do particularly well, again this comes back to a strained consumer. We know again that credit card balances are over a trillion dollars, we know take that there has been a squeeze on cost of living, whether thats in rents, whether its in groceries, whether its in gasoline prices, whether its in Mortgage Rates still being in the mid7s and this is putting pressure on the consumer so we saw retail sales really weak in january. If we see another weak number in february, thats going to really signal something to powell. Maria well, let me get your take in terms of what the fed does. Weve got the meeting next week, the 31st, on the two day fed meeting. Are you expecting any action or any alluding to a cut down the road, perhaps june . Is that where you are, june cut . We are three rate cuts starting in june, again, maria, lets see what happens in an hour and investors are going to have to focus on Inflation Numbers in unison with the payrolls numbers that we saw on friday. Look, there was a strong headline payrolls number but it was pretty mixed, we saw revisions down from the previous two months, we saw unemployment spike up to 3. 9 , average Hourly Earnings did temper a little bit. Thats what the fed needs to see to provide impetus to start t cutting. If we see cpi around 3. 7 , reduction in the core from january then i think that does give power for the fed and for powell to start reducing in june. Maria yeah. Let me just correct myself. The fed meeting is next week, march 19th and 20th. So it is in fact next week, not the end of the month. 19th and 20th. Luke, your thoughts on that as well as crypto. Wow, are we out on the risk curve or what, crypto prices are down this morning but look at bitcoin, it topped 72,000 yesterday, another alltime high. Thwhat is going on with crypto right now, luke, and would you buy into it . Great question. Im going to tell you the sam thing i said in december of last year, i said that bitcoins in the best of both words, winwin situation right now. Speculation like the nasdaq and technology, all these stocks keep on rocking higher and speculation comes back on the table thats good for bitcoin because bitcoin is a speculative asset. At the same time when you have the Silicon Valley based situation, Community Bank came in, thats what bitcoin was designed to do, hedge against the system. You have the best of worlds situation, you have speculation and cracks in the financial a system. Thats good for bitcoin. Im going to tell viewers what im doing with my family right now. We allocated 4 to b c bitcoin n it was 18,000. Its quadruple since that point of time. New we trimmed it down. Its not bad to take some profits off the table when the time comes. As bitcoin rises it gives more excuse for the government to come in and try to regulate and do something with it, talk about it, because it takes power away from the government. If you have more cracks that form youll hear more congress, more politicians talk about whether bitcoin is good or bad. That could cause volatility. Maria do you believe the fed is watching the cpi number this morning and will it dictate what they do . The meeting is next week, luke, march 19 and 20. What are you expecting . Every data point i think influences the Federal Reserve. At the end of the day, one unknown that the Federal Reserve has no idea whats happening is the impact of this technological revolution thats happening with businesses. Implementation of Artificial Intelligence or technology to become more efficient when it comes to business side of things and if thats the case, you have a bunch of businesses pouring billions and billions of dollars into their business to try to make up for this technological revolution or try to implement the technological revolution. If thats the case, thats inflationary which doesnt surprise me. It might be an uptick in inflation because you have a bunch of businesses investing money into the new technology. Maria well see. The numbers out in about an hour, a lot of people expecting a hot number but piper sandler, nancy lazar said it will be below estimates. This is a market mover. Brenda, great to see you. Luke, youre with us all morning, we appreciate that. Quick break and then President Bidens massive Budget Proposal includes 5 andahalf trillion dollars in new taxes, just under 5 billion for the border. Texas congressman August Pfluger is here with reaction after the break. 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The basement. So i can finally throw that party. And invite shannon barnes. Dream do come true. Xfinity gives you reliable wifi with walltowall coverage on all your devices, even when everyone is online. Maybe well even get married one day. I wonder what i will be doing . Probably still living here with mom and dad. Fast reliable speeds right where you need them. Thats walltowall wifi on the xfinity 10g network. Maria welcome back. Well, the white house is asking for 5 andahalf trillion dollars in new and higher taxes in President Bidens massive 7. 3 trillion budget for 2025. Biden requesting just 4. 7 billion in Emergency Funding for Homeland Security as Illegal Migrants surge our southern border. He wants more than 400 million for the Border Patrol and nearly 900 million for to counter the deadly fentanyl problem. Joining us now, texas congressman August Pfluger. Congressman, your reaction to the president s budget . Well, maria, thank you for having me on this morning. Its no surprise it worsens our economic situation, he raises taxes, theyre going to increase the debt and deficit by 34 trillion over the next 10 years or 18 trillion to get to 50 trillion total in our debt. But really he does nothing to you aaddress the situation at te border, hes actually continuing his war on fossil fuels and what we need is policy changes at the border. What we need is a commander in chief who actually goes to the border and understands that there are no consequences and the fact that he says in the event of a surge, well create a slush fund, an Emergency Fund to help process hes more more imm, signals to the rest of us who know whats going on that he doesnt have any intention of stopping this crisis. Maria i think this is a really good point you make. When i hear money going to the border im thinking what is that money for . I know that we need policy changes at the border. Ive heard from a number of republicans how remain in mexico worked under the trump administration. But if you give more border money, give more money to the border, doesnt that just mean youre hiring more people to continue processing more migrants p . Well, thats exactly right. Its a slush fund for mayorkas to be able to send air marshals like he wants to, to the border to process, which we have ledge layings against. He wants legislation against. He wants to process faster and more efficiently. When you talk to Border Patrol agents theyll say they need an overtime adjustment. They are working overtime. We have been working on that. We need to continue building a wall, we need technology to identify those coming you cross the border but they dont need money nearly as bad as they need policy changes and the political will to the stop this tragedy from happening which is three years running now. Maria yeah. Walk us through some of these tax increases. I mean, he claims no one making 400,000 is going to see any taxes going up. But if youre raising taxes on small business, doesnt that also capture individuals . Because some of these tax increases he wants to increase the corporate alternative minimum tax to 21 from 15 . He wants to quadruple the stock buyback tax to 4 from 1 . Raise the Corporate Income tax to 28 from 21 . Theres a 25 billionaires tax and then theres the longer depridepreciation and higher ful taxes on corporate jets. Its obvious when you compare and contrast that with the 2017 tax cuts and jobs act which kevin brady championed in the house of representatives which increased revenue, lower taxes for every single american, their approach is completely opposite. They want to tax corporations, they want to continue increase taxes, which will affect every single american and it will affect their paychecks but will also affect what we as consumers are purchasing, what the economy is running on. Its a completely different approach. But the fact is, theyre going to raise 75, 80 trillion in taxes over the next 10 years as opposed to republican plans where well spend less and were going to continue to bring your taxes down, acfollowfollowingin acknowledging thats the way you increase revenue, that you unleash american energy, unleash Small Businesses, dont have taxes on corporations which are employing thousands of people so its a completely different approach but i think the one thing we can agree on is theyre acknowledging there is a problem with the economy and the fundamentals of our economy with this budget. Maria h well, a completely different approach in terms of how to allocate money. The biden team wants to spend money on the Climate Change agenda, you know, kill fossil fuels, the republicans want to tap into the u. S. Energy capacity and secure the border. A new gallup poll reveals 55 of americans see illegal immigration as a critical threat to the United States. The president told reporters yesterday that he is counting on the border crisis to solve itself. Watch this. Ive got to get your reaction to this exchange. Mr. President , when is the border executive action coming, executive action on the border. The Border Action will happen by itself. Maria happens by itself, congressman. This again falls in the category of you cant make this up. Heres our chief executive, the commander in chief with an nonsenseical reply. We need your help, your leadership. Its not going to solve itself. We need you to say youre going to take immediate action but unfortunately for the three years running you have created a situation where we have 9 million Illegal Immigrants, hundreds of people matching the terror watch list. Congress has passed the strongest legislation which was hr2 and youve taken zero action on that. Its time to step up. Its hurting every community. Maria i want to talk about your bill. You are introducing a bill to block noncitizens from serving as administrators in our nations elections, this seems practical to me. Of course you want citizens to be doing this kind of work but just last month San Francisco appointed a Chinese National to serve on its federal election commission. They actually did the ceremony in chinese. This is incredible. What is going on in San Francisco and why are noncitizens going to be in charge of our elections . You know, look, i applaud anybody who wants to become a citizen. That should be the highest standard to become a citizen but our Voting System depends on citizen pship. It depends on reaching that point where you say i love this country, you take the pledge of allegiance seriously. It is unbelievable to think that places like San Francisco are putting noncitizens in charge of the Voting System which doesnt just affect San Francisco, it affects federal election as well. This is a growing trend across the country, placings like new york city, washington, d. C. Where i have legislation as well to prevent no noncitizens frm voting. We make sure the Voting System is elevated to the level of citizenship, Anyone Running in it, oversight, including registering new voters is a citizen and in this case if you read the interview, this lady in california said she wanted to represent the interest of all noncitizens because they have a stake in our Voting System. Listen, we have got to make sure that we keep our Voting System and the integrity of it completely pure when it comes to set senseship as citizenship as as the definite ultimate gold standard. Maria congressman, come on, is this really going to pass. You and your colleagues couldnt get senator haggertys amachinedment past, he was barring illegal alienses from being counted in electoral seats. It failed in the senate. Listen to what senator haggerty toll me on the program yesterday. We want them to create more electoral power in their blue states, creating sanctuary cities to be magnet so theyll flow to the blue states. Theyre shipping them there as rapidly as they can, 10 Million People have come in here, it would be 13 additional congressional districts allocate inned the right way. This is a tremendous amount of power that the democrats are bringing in. Maria is that what this is about, congressman . Getting illegals to vote, is that why we have an open border, so the democrats have more voters on their side and if so, what are you going to do about it . Well, i think this bill is one step in the right direction. Youre right is President Biden going to sign this into law when he literally opened our borders to millions of people . Probably not. But that still doesnt mean we dont take action. We are going to take action. I hope the senate will look at this and t action. We do have a big problem. The deconstruction of the rule of law at the border is a problem. It will be their legacy. It will be the top issue on the ballot in november with republicans having real solutions. Maria congressman, always a pleasure to catch up with you. Thank you, sir. Thank you, maria. Maria augu all right. August pfluger joining us this morning. Quick break and well be right back. Stay with us. Is bad debt holding you back . The only limit is the sky its our time you dont want to miss it just a little bit louder its our time you dont want to miss it its your moment in the spotlight all your ambitions. All in one app. Low fixed rates. Borrow up to 100k. No fees required. Sofi. Get your money right®. Business. Its not a ninetofive proposition. Its all day and into the night. Its all the things that keep this world turning. Its the gotos that keep us going. The places we cheer. Trust. Hang out. And check in. They all choose the advanced Network Solutions and round the clock partnership from comcast business. Powering more businesses than anyone. 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Com hire shipstation saves us so much time it makes it really easy and seamless pick an order print everything you need slap the label on ito the box and its ready to go our cost for shipping, were cut in half just like that go to shipstation tv and get 2 months free maria welcome back. President trumps legal team hoping to adjourn his new york city hush money trial after another Supreme Court decision. Cheryl casone with details. Thats right, maria. Lawyers for former President Donald Trump filing a motion here in manhattan to delay the trial initiated by new York District attorney alvin bragg until after the Supreme Court rules on whether or not trump has president ial immunity. This case revolves around payments made to stormy daniels, bragg indicting trump on 34 counts of falsifying business records. Jury selection is expected marc. The trial is expected to last six weeks. Well see what the ruling is. A new bill proposed in california would extend legal aid to Illegal Immigrants convicted of violent felonies, the bills author says it would be a step forward for racial justice. Taxpayer funds would pay for lawyers to defend Illegal Migrants and the money would come from the nonprofit grants that are meant for education outreach and help with immigration status. Right now, state rules mean those funds cannot be used for those that are convicted of violent crimes. Well, new york may be known for iconic pizza. Thats not stopping the city from reducing new you regulation that could put 100 local pizzerias ott out of business. The plan would require wood and coal fired stoves to cut Carbon Emissions by 75 . This rule is supposed to take effect april 27th. Several pizza shop owners are saying this is overkill and they theycant afford to comply. Has tipping gone too far . Apparently americans say it is has, three quarters of americans believe the culture of tipping has gotten out of control. A survey of over 1,000 americans finds 76 say its just too much. Nearly half say theyve been asked to tip on a self service machine. 84 say just increase minimum wage for servers. Those h are some of your headlines. We were planning to get pizza later today. It might w be a rough go. Maria pizza is better in a brick oven. Says the expert. Maria thank you, cheryl. Regional banks in focus, one year after the collapse of Silicon Valley bank. New York Community bancorp is facing stability risk, closing the cash infusion deal agreed to last week, announcing plans to submit a 1 for 3 reverse stock split of its common stock to shareholders. Nycb stock is down better than 68 just this year, yeartodate. Joining me is the ceo of kbw, thomas mishow with us. Thank you for being here. Your firm is the leader in terms of this bank research. I want to get your take on the stability of these banks. We had the collapse of svb one year ago and now were questioning the state of Regional Banks after what were seeing happening with new York Community. Maria, good morning. Its two things. One is while three banks unfortunately spectacularly failed last spring, 4700 did not. The industry is resilient. That wont stop the challenges of commercial real estate. I heard you speak about new York Community. Commercial real estate losses are going up and its going to go up for banks, its going to go up for nonbanks involved in the industry. And like you said, the question is how resilient is the industry to handle it . So if you looked at new York Community, you would see that it was probably one of the most concentrated banks in commercial real estate. So while it was unfortunate for the shareholders in new York Community t i think it was rather bullish that some sophisticated capital was really to recap the company which i think says something about the industrys resilience so thats how i would wrap it all together. Maria where are the specific risks and threats . Because i spoke with steve schwarzman, the chairman of the blackstone group. Theyre the largest owner of commercial real estate in the world. By the way, i reported this last week. He told me rent is no longer going up. So rent is going to be a big component of the cpi coming up. Rent is flat to down according to steve schwarzman. Well see if it shows up they the cpi number. But also according to schwarzman is the fact that he says commercial real estate is not all bad, its just office space. So are you looking at weakness around office space only or are there other cracks we need to understand . Youre right, commercial real estates an enormous class, one of the biggest in the country so youve got to break it down into slices. The areas we are most focused on are big urban typically coastal commercial real estate buildings. You look at wells fargo in the fourth quarter, they have a 10 andahalf percent reserve against that portfolio which is a very significant reserve. We also look at anything thats rent regulated a concern and were looking at seasonality, loans made in the 2021 period for example when Interest Rates were essentially zero as those start to refi, youre going to have to look at the ability to handle the refi. All that being said, maria, but it gets back to this one year anniversary. Can the industry handle it . We think its not a systemic issue, its an earnings issue. So thats why we think Certain Companies are going to have more risk to their earnings estimates but we dont think its a solvency issue and i think thats what the history books are going to say about this moment. There are individual Companies Like new York Community that are in the eye of the storm but its not a systemic issue. Maria when i spoke with howard lutnick, chairman and ceo of cantor fitzgerald, he told me to expect 900 billion of he defaults because of the issue youre talking about, because the rates the Interest Rates are changing after the 11 rate hikes from the Federal Reserve and that is a game changer for some of these companies. Is that the kind of he dedid fault situation you default situation you expect to play out. If Something Like that defaults that could be bad if youre the equity holder. A lot of the banks lent 50 loan to value on some of these properties. Wells fargo has a 10 andahalf percent loan loss reserve. We think the Global Financial crisis was less than 10 andahalf percent. The banks have equity ahead of them. It depends where you are in the Capital Stack but i also want to get to the stocks, maria. Because the headline risk to these challenges for individual companies is enormous. I was watching the key bank index while the news of new York Community was hitting the tape. You can see the banks going down. Our view is there are trough if phis on sale. Trophies on sale. We had a conference. I spoke to one ceo from montana. He has no rent controlled loans on his books so there are a lot of really wellrun Regional Banks and the bigger banks have much less commercial real estate exposure. We like trueist, for example, we like u. S. Bank corp. Had hamaria what about the prs in terms of oversight . Were watching the basel 3 end game right now, the banking regulations and weve been talking to a lot of people about the banking regulations. Heres what the wall street journal writes, the banking regulations will not address some root causes of the Regional Bank discomfort. Thomas. And the broader outlook for regulation appears to put u. S. Banks at a disadvantage. Thats what jamie dimon told me when i asked him what jp morgan has to say about these basel 3 proposals. Watch this. I youve spoken about this, the capital levels required for thebacks as were end of the comment period. What is your assessment of these proposals. These will be embedded in everything. Some said big corporations can afford it. They will pass it onto customers. It will be passed on in a million different ways. No one ever looked and said heres the outcome of the changes and we want these outcomes. The outcomes should be what you want. So the Mortgage Business is leaving bank, credit is leaving banking. If thats what the regulators want, so be it. If we have to hold 30 more capital in the us than foreign pep competitors in the us, i dot think its appropriate. I think the work was poorly done. Maria your reaction to basel 3 end game proposals. I think theyre too strict. I agree with jamie on those points. The American Finance industry is the leader globally, helps the economy tremendously. To take it to a higher level than International Competitors and like jamie said, i dont know what the end game of the policy is, what is the goal other than trying to push business out of the Banking Industry which i think will have adverse impact down the road. But also to get back to what we really need, we need deposit insurance reform because, maria, if we were to flashback a year, remember what the crisis point was. Payroll accounts. A lot of Small Businesses didnt know if they could make payroll and wanted to know about the safety of their bank p. The fdic fund hasnt been modernized in some time. Its time to take transaction and payroll accounts, give them more deposit insurance, and that would have stopped the run a year ago. Thats what should be done, not these higher capital ratios which i think are going to end up being anticompetitive for the banks and would not be focused on what happened last year. Maria such an important point that you make, thomas, its exactly the sentiment of robert kaplan, former president of the dallas Federal Reserve, that is where he says change is needed as well, looking at the insurance, thomas, great to have you. Final word. Final word is, the one area i agree with which is putting mark to market bond portfolios down a little bit lower into the industry, i think that is a good idea. That would be one proposal i think that should stick but i think that the deposit insurance is the null better one thing that could have stopped the spreadnd a it was the reason why the fdic was created. Thats what i think should be focused on, not taking capital ratios up. Maria we will keep a spotlight on the deposit insurance. Thomas, thank you. Good to see you, sir. Good to see you. Maria we will be right back. Stay with us. Grace didnt believe in magic. But her daughter was happy to prove her wrong. You were made to dream about it for years. We were made to help you book it in minutes. Ah, these bills are crazy. She has no idea shes sitting on a goldmine. Well she doesnt know that if she owns a Life Insurance policy of 100,000 or more she can sell all or part of it to coventry for cash. Even a term policy. Even a term policy . Even a term policy find out if youre sitting on a goldmine. Call Coventry Direct today at the number on your screen, or visit coventrydirect. Com. Youre probably not easily persuaded to switch mobile providers for your business. But what if we told you its possible that comcast business mobile can save you up to 75 a year on your wireless bill versus the big three carriers . You can get two unlimited lines for just 30 each month. All in the most reliable 5g mobile Network Nationwide wireless that works for you. Switch to comcast business mobile and save big with up to 500 off an eligible samsung device with a qualifying tradein. Dont wait call, click or visit an xfinity store. Maria welcome back. National Security Officials are holding a classified briefing on the tiktok bill today. The houses is set to vote on a bipartisan bill tomorrow that would force Chinese Company bytedance to either sell tiktok or face a ban in the United States. Some lawmakers are calling out the app and security risks. Watch. Its literally reading your mind, the more you use it, the it knows about it. The problem is that bytedance and their engineers in china are the ones that own that Artificial Intelligence. And no matter where you put my data or anybody i dont use tiktok. People that use tiktok. No matter where you store the data, those engineers in china have to have access to the data. They control the brain of tiktok, they control the Artificial Intelligence. Maria thats pretty serious stuff. Joining me is federal Communications Commission senior republican and commissioner, brendan karr. Good to see you. Thank you for being here. Walk us through the risks around tiktok and what youre expecting from the house vote tomorrow. Tiktok presents a clear and present danger to u. S. National security that is categorically different than any other social Media Company out there. Ive got my fair share of concerns with other Big Tech Companies but tiktok is different. Heres what we no, based on public already undisclosed publicly disclosed data. One, tiktok said for years that u. S. User data, Sensitive Data isnt even available inside of china and a blockbuster report came out and showed based on leaked internal materials that, no, everything is seen inside china and that everything is searched in browsing history, key so stroke patterns , locatin data and theyre using that for nefarious purposes. Tiktoks Parent Company hads has a ccp cell embedded in leadership. Tiktok leadership after they were caught, said were going to change course and wall that data out. A wall street journal report came out showing personnel in china are getting access to the data. Its a serious threat. Its great to see the bipartisan tar gotted legislation working through the house. Maria i want to get your take on the legislation in a second but weve got mothers watching, parents watching right now and they may have kids who are on tiktok and they dont necessarily understand this threat what specifically is beijing or communist party of china doing with this data, why should i be afraid of them having this data on me. Its deeply concerning. Most parents probably think of tiktok that its like any other social Media Application where its content from your friends, your friends friends, not at all. It starts to feed videos determined by algorithm based out of china. Studies show that accounts set up for 13yearold girls within minutes of those accounts being set up theyre fed self harm, eating disorder, Suicidal Ideation content the and compare that to the version of tiktok going on thats available inside beijing, shows kids there educational material, science exhibits, museum exhibits so its a very concerning application, both from an espionage perspective but also from a foreign influence point of view. Maria wow. Brendan, thats why you posted on x tiktok presents a different threat to the United States than any other big tech company, commissioner. Its different than a facebook. Its different than an instagram, is that right . Independent studies looked at it and showed that the source code for tiktok h harvest an unprecedented amount of data. They found a lot of code or severity warnings more than two times as bad as other social media. Some people said we need privacy laws and stop data flows in general. Theres nothing wrong with that in principle. It doesnt work with tiktok. They already tried to do that. As long as theyre beholden to the ccps theres no way, even if theyre well intentioned to stop those bad actors from getting access to u. S. User data thats why the bill is so important because it breaks tiktok from its ccp ties and people that love tiktok get to continue to use it but just in a way that doesnt present a security threat. Maria all right. So break down the bill for us. What do you like most about it and do you believe its going to pass in the house and actually result in tiktok breaking ties with the ccp, the communist party of china . The bills in a really good spot in the house, it was 500 vote in the house commerce committee. I hone it passes this week and its off to the senate. Senator shy you her senator schumer and senator cotton wrote a letter raising concerns about the National Security threats at tiktok. I like the odds there as well. The bill is targeted. Some concerns are based on previous bills that were arguably broader than this one but here it only applies if an application is controlled by russia, china, north cree he ya northkorea or iran and if ita National Security threat and theres process as well, has to be public notification process and congress is also involved. So this is targeted. No new authorities to the government to go after individual use earls. Users. Its a smart way of legislating in the area. A lot of people questioned whether congress can get big things done. Theyre on the cusp of a significant legislative win this week. Maria on the cusp of getting a legislative win, that means you believe that a ultimately tiktok will be forced to sever tie was the communist party is that what youre saying. This bill will definitively resolve the serious National Security threat from tiktok by requiring them to divest. Weve done it on other applications. The technical implementation of it is less of a problem than getting the policy cut right and thats why it was so important to have the bill, bipartisan, its a really smart path forward. Maria maybe. Commissioner, why is anybody to believe that tiktok is dangerous when President Biden is all of it . Okay. Hes doing tiktok videos campaigning to young people right now. Its a good question. Look, the biden administrations National Security team has been very clear about the threat and frankly once the bill passes then anybody can be on tiktok and so m a way thats safe and doesnt present a National Security threat so we can square the circle once the legislation gets passed. Maria if they sever tie was the ccp. Thats right. Maria do you think it will get acquired by an American Company . Under trump there were discussions that oracle could you acquire tiktok, right . Yeah, its possible. It doesnt necessarily need to be a u. S. Company under the legislation, it could be he any company as long as its not beholden to the board. They can do this consistent with the first amend machined, some people say tiktok is a free speech plat form that people use and the constitution and the Supreme Court law is very clear, this is legislation based on tiktoks conduct that presents a National Security threat, not its contents. The Supreme Court draws a clear line between those so as long as were legislating looking in the future about a National Security threat it doesnt present a First Amendment issue. The constitution doesnt require the government to allow tiktoks National Security threat to persist. Maria commissioner, great info from you. We appreciate it. Thanks very much. Thanks. Maria already, brendan karr joining us. Well be right back, historics and unforgettable scenery with viking. Unpack once and get closer to iconic landmarks, local life and cultural treasures. 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