00:00Hawaii is increasing its use of renewables to find cheaper and cleaner sources of power
00:05because Hawaii people pay among the highest, if not the highest, for energy.
00:10And you're nodding. Thank you for acknowledging that.
00:14And our utility customers on Oahu have been warned to expect power bills to rise up to 30%
00:22over the next several months due to the higher oil prices from President Trump's war of choice.
00:30And that is a $40 to $60 higher power bill every month for an average customer
00:36on top of record amounts that we also pay probably the most at the pump, if not the most, for
00:43gasoline.
00:44Did you understand the harmful impact on energy prices for consumers in Hawaii and the rest of the country
00:50and parts of the world, as a matter of fact, before the president launched his illegal war against Iran?
01:00Absolutely, Senator. Iran has been a threat to global energy supplies for 47 years.
01:06I think it was very clear-eyed that to solve this problem...
01:10But, Mr. Secretary, a lot of the energy that is provided is through the Strait of Hormuz,
01:15which was open, and now it's closed.
01:18Because, cause and effect, rising prices of oil, rising prices of energy,
01:24is that something that you did not contemplate happening before the president declared his illegal war?
01:30No, we knew exactly what would happen.
01:32It doesn't seem like it, because the president doesn't know how to end this war,
01:36how to reopen the straits.
01:39Are you telling me you have a handle on this?
01:43Repeat the question, please, Senator.
01:45Are you telling me that you are involved in opening the Strait of Hormuz,
01:50so that the energy prices, which are directly impacted by the closure of the strait,
01:56is going to ease?
01:58Are you directly involved in making that happen?
02:02Look, I'm the primary energy advisor to the president,
02:05and have been discussing the Iran situation, potential solutions to the Iran situation,
02:09since the day I was sworn in.
02:14You mentioned that you have some background in nuclear.
02:17I didn't know that.
02:18I thought you were the CEO of an oil company.
02:22But be that as it may, there's no end in sight with this, what I would call the illegal war.
02:30You know, the reference of the war of choice, what is that?
02:33It's an illegal war that the president declared.
02:36And where is the end here?
02:38Are oil prices going to go down?
02:41Are people going to be able to look to the lowering of gasoline prices?
02:46When you have people to fill up their cars, it now costs like $50, $60 more.
02:52You see, that's something that people cannot sustain.
02:55I agree with you.
02:56Energy prices are higher than they've been before right now.
02:59They're still more than a dollar a gallon cheaper than they were during the peak in the Biden administration.
03:03And we're fixing a 47-year problem in the Middle East that will increase the security of energy supplies after
03:11this war than before the war.
03:12Frankly, that is really hard to believe.
03:17Earlier today, you said to Senator Kennedy that President Trump never demanded you to cut interest rates in your job
03:24interview.
03:24Is that your sworn testimony?
03:26That is, Senator.
03:27Well, someone here is lying, then, because it's either you or President Trump, because in an interview with the Wall
03:34Street Journal of December 12, President Trump confirmed that he pressed you on your commitment to support interest rates cuts.
03:42And I quote, during a 45-minute meeting with Walsh on Wednesday at the White House, the President pressed Walsh
03:49on whether he could trust him to support interest rate cuts if he were chosen to lead the central bank.
03:54According to people familiar with the meeting, Trump, in the general interview, confirmed that, repeating,
03:59Mr. Chairman, I'd like to enter for the record the Wall Street Journal article December 12, Trump says he's leaning
04:05towards Walsh or has it to lead the Fed.
04:07So, you know, this brings up an issue of credibility at this point.
04:11Who's lying here?
04:12Is it you or the President?
04:14Because the President confirmed that he did ask you to cut interest rates.
04:18Senator, there's, of course, a third alternative.
04:21You cite a couple of reporters for a leading financial newspaper.
04:26I recall reading that story at the time.
04:28Did you ask a correction?
04:29I think those reporters either need better sources or better journalist standards.
04:34Did you ask for a correction?
04:36There are things in the newspapers, Senator, I see all the time that don't strike my ear as correct.
04:41So, is it in your opinion that the President then is lying when he said he did not ask you?
04:47I can only repeat to you, Senator, what I said to several of your colleagues.
04:51So, you did not.
04:52You right now are, under a sworn testimony, are saying just right now that the President of the United States
04:59in that job interview did not ask you to cut interest rates.
05:02The President never asked me to commit to interest rate cuts at any particular meeting over the period of my
05:09tenure at the Fed.
05:10He didn't ask for it.
05:12He didn't demand it.
05:13He didn't require it.
05:14And nor would I have ever done so.
05:16So, if these reporters come back and say to do another follow-up on this and they confirm what they
05:21heard, what will your response be?
05:22Well, my response would be what I suggested to you a few moments ago.
05:26As I read that story in real time, I remember thinking they either need better journalistic standards or better sources.
05:33So, you know, here's my problem, Mr. Chair and colleagues.
05:38You know, and Mr. Warsh, I think you're incredibly qualified.
05:41A lot of us are actually worried about the integrity of the Federal Reserve.
05:44We're worried about what this means for the economic markets, and we're worried about what this means for inflation.
05:49We're worried about your independence, and now we're hearing direct contradictions whether or not you were directly asked by the
05:56President to cut interest rates.
05:59And you're saying no, and he's saying yes.
06:01And I think for a lot of us, there's a question now of credibility.
06:04And I think there's a real reason why many of us are not voting no.
06:08As a matter of fact, until you verbally spoke to Mr. Kennedy and answered his question that he did not
06:14ask, the President did not ask you to cut interest rates, this was not even going to be brought up.
06:20So there's definitely right now a true question about who is lying here.
06:25It's either you or it's the President.
06:26Can you tell us a little bit about your conversations with President Trump about interest rates?
06:33Yeah, I don't want to put words in the President's mouth, but I think he has said loudly and clearly
06:38his view on interest rates.
06:40I don't think I'm breaking any news here.
06:43But I can tell you what I said, and what I said the President is what I've said to this
06:48committee and what I've frankly been writing about for more than a decade.
06:53Interest rates are the much better way to be using monetary policy than buying bonds and mortgages, some of which
07:01are issued from the United States Treasury Department.
07:04That is a confusion of roles.
07:06That leads to a set of mission creep.
07:08So interest rates are the dominant tool, and interest rates, as I mentioned, get in the cracks.
07:13My broad view on the conduct of policy from here is that too many Fed officials, past and present, opine
07:22in advance about where they think interest rates should be next meeting, next quarter, next year.
07:27I think that's quite unhelpful.
07:30As we've heard today from many of your colleagues, we don't know the state of AI.
07:36We can't be certain about the state of geopolitics.
07:39The economy is going to change.
07:41You need central bankers that are humble, that are nimble, that are open-minded, that can react when we have
07:47good data, when events strike us.
07:49My broad view is that interest rates need to be forward-looking, need to be based on better data, and
07:56we should have a big, robust deliberation inside the FOMC.
08:01I tend to favor messier meetings than some, where people don't show up with rehearsed scripts, but we can have
08:07a good family fight.
08:08If the central bank has that good family fight, I think that they're going to make better decisions, and if
08:14they happen to make mistakes, they'll correct them sooner.
08:17So I'm not one for pre-deciding what interest rates should be.
08:22I never said to the president where I think rates should be.
08:26I never committed any such thing, and I wouldn't have even thought about doing so.
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