Shutdown, What Shutdown? & Kodiak’s Nasdaq Launch

0:00Bring in show music, please. Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod. Yep, we're here again. Another government funding deadline looms. Democratic Senator Gene Shaheen on the devil in the details. Everybody needs to stop the kabuki theater and go to the table and negotiate. That's what the American people are expecting. And the White House lays the groundwork for mass firings at the federal level if there's a shutdown October 1st. Reporter Emily Wilkins on what's safe. Things like border security, the military, or those who have programs in line with the president's priorities.

0:40And just how long a funding plan are we talking about here? If they do get an agreement, how long till we do this again? November 21st, if they go for the bill that Republicans are pushing for. I can't. I can't. Robotrucks head to Wall Street. Starting trading today on the Nasdaq, autonomous trucks Kodiak Robotics, driving to a two-plus billion dollar valuation. We've been working to automate the trucks with AI technology that allows them to effectively drive on their own. You just give a little beep. Beep, beep. Plus, selling American citizenship. Robert Frank on the price of the administration's gold card, on sale, slashed from$5 million to one.

1:22It even says that on the Trump gold card website. It said, unlock your privileges now. It's Thursday, September 25th. Squawk Pod begins right now. Stand Becky by in 3, 2, 1. Cue it, please. Good morning, everybody. Welcome to Squawk Box right here on CNBC. We're live from the NASDAQ market site in Times Square. I'm Becky Quick, along with Joe Kernan. Andrew is out today. Intel reportedly is speaking to Apple about a possible investment from the iPhone maker and about working more closely together. It's a Bloomberg report. It says the talks are at this point in the early stages may not amount to anything at this point.

2:06Also, that Apple is unlikely to switch back to using Intel chips in its products. CNBC has reached out to Apple for comments. Intel shares jumping more than 6 % on the news this morning. That's a number we, 32, we haven't seen in a long time. On pace, Intel for the best month that it has had in more than two years. While Becky reads this next door, I'm just going to hit up a chart on Intel and see. Back from the... Yeah. I don't want to say back from the dead, but back from the near-dead. That's exactly what I was saying. Back from the nearly dead, newly wed is what we used to call when I lived in Pasadena.

2:46There is... Yeah, that's... How long is that? Go back further. Yeah, there you go. Let's go back a little further. That shows you. So down 35 percent still over the five year period. But some real interest and some major investors that matter, like the U.S. government, like NVIDIA. The vendor financing with NVIDIA was right. Got that was up that day. Closed that day down. Closed down yesterday. Six days. What do we got left in September? That's plenty of time for September to live up to its reputation. It hasn't, because October, you know, those teens, the teens of October, so many lows are made.

3:27But September is usually not great. It's usually not great. And that's where you make a low. And nothing's happened. So I'm not saying it is. But everybody knows about valuations. If you take a ride in a cab in New York or an Uber, you might talk to the driver about valuations in the Mag7. Mag7, they look at crypto. Mega, Mega. I'll mix up. Maybe it's just me. Senior White House officials tell NBC News that President Trump plans to sign a deal to facilitate the sale of TikTok today. Once that deal is implemented, TikTok's U.S. operations would be run by a new joint venture company. One official said that Chinese owner ByteDance will hold less than 20 percent of the stock of the new company.

4:12Of course, the question's still circulating around what happens to the algorithm. But the latest that we've been hearing on this is that the algorithm would be maintained and monitored by the U.S. investors and operations. The Trump administration launching national security investigations into imports of robotics, industrial machinery and medical devices that could pave the way for future tariffs on those products. In the medical field, products could include prescription drugs, syringes, and imported medical equipment like wheelchairs, pacemakers, and insulin pumps. The Commerce Department is seeking comment from affected companies to see whether domestic production can meet U.S.

4:54demand. Those are things you don't want shortages in, but they're things we've been talking about since COVID that you would like to see manufactured here in the United States. Federal workers could be at risk of more than furloughs if the government shuts down in a few days. Emily Wilkins joins us now with the latest from D.C. and the well, we'll talk at the end, Emily, but the as expected rhetoric. If you need you need 60 votes in the Senate, right? Is that what you need? You need you need 60 votes in the Senate, Joe. And you got to map the math. There are only 53 Republicans. Some of them have to be Democrats.

5:29And look at this. How are you going to say how they get to say so? OK, so you get all the Republicans. The government shuts down because you don't get to 60 with a straight face. How do Democrats say the Republicans are shutting down the government? Well, if you're a Democrat and we've listened to Chuck Schumer and Hakeem Jeffries and what they've kind of said is, look, what we want is for some some health care provision to be in there. They haven't been super specific on exactly what it needs to be, but they're hoping they want to get that in there. And they do point out that there are these tax credits for the Affordable Care Act that are expiring.

6:05That does seem something that does have Republican support. And look, I mean, this is part of what we're seeing with this news last night. This Trump administration going ahead, escalating the stakes of a federal shutdown, putting pressure on Democrats, saying that they're going to implement a large-scale federal layoff if Democrats don't vote with Republicans to keep the government open. Now, the Office of Management and Budget, they're the one who sent out this memo, and they told agencies that they should consider firing employees who would have otherwise merely been temporarily furloughed in a shutdown.

6:37Now, the last time there was a full government shutdown in 2013, about 850 ,000 employees were furloughed. That's according to the Committee for a Responsible Federal Budget. The guidance from OMB that CNBC got says the layoff should not apply to agencies and programs that were funded in the Trump mega bill. So think things like border security, the military, or those who have programs in line with the president's priorities. But the memo also makes clear that no mass layoffs are going to take place as long as Democrats vote to keep the government open. The agency actually ended their memo saying that they remain hopeful that Democrats in Congress will not trigger a shutdown and the steps outlined above will not be necessary.

7:19But at this point, the pressure campaign doesn't seem to be working. top Senate Republican Chuck Schumer. He remains unswayed. In a statement, he called the move an attempt at intimidation, and he said that these unnecessary firings will either be overturned in the court or the administration will end up hiring the workers back. And, Joe, as we were just discussing, again, you need at least seven Democrats. You might even need a few more, depending on what the votes we saw last time. They're out of Congress right now. They're off of Capitol Hill. They're coming back on Monday. that's when we expect to see the next vote.

7:54And this is kind of the back and forth that we're seeing right now. Democrats pushing health care and Republicans pushing back. We all have government shutdown fatigue in the brinkmanship that both sides play. A couple of years ago, when the Republicans were out of power and the Democrats were going to do it, they're saying if it shuts down, and you know the Freedom Caucus, they're saying we want these kind of cuts and we're not going to do it until they say so it's not really us we want cuts and if you don't this time feels a little different yeah but how it's it's a shoo or shutdown because they're the minority party they can't dictate what i'm not arguing with you what i'm saying is this time feels different because instead of compromise i think they might actually go ahead with this and and the democrats have been the ones who have been so unhappy about the number of layoffs in the federal government windows came to what us do what we want as a minority party or else it's your fault the government shuts down.

8:51My guess is this is, look, it looks like a big game of chicken at this point. Emily, I don't know what you think, but I would be surprised to see the Democrats go ahead with it with this new threat that's out there. Because you can say the courts will overturn it, that this will happen, but this has been one of their keys that they've been arguing with the Trump administration since January over is the idea that these government workers are necessary, that these government functions are necessary, and you can't do it without them. If they do go ahead with this, and those workers are furloughed, and there's a number of months or even longer before they're brought back, that undermines a huge point that the Democrats have been trying to make all along with this.

9:32Absolutely, Becky. And you remember back in March, this is part of the reason that Schumer gave for voting to continue that government funding when we were looking at the shutdown just a few months ago. And so now to have this come up, but Schumer now seems to believe, at least based on what he said in the last 12 hours, that he's trying to call their bluff, trying to say, hey, you guys have tried to fire folks. You've had to bring them back. You understand at this point that you can't just let a bunch of people go and trying to call them on that. I think at this point you also have to remember the flu implications.

10:05Using people as pawns is not a popular game that's going to play well, particularly, I think, on the Democrats' side. But this is a sideshow. It's a sideshow. If the government gets shut down, how are the Democrats going to say this is the Republicans shutting the government down because they're not doing what we want? They don't have the right... And if you shut the government down, how do you get out of a shutdown? What do Republicans possibly give Democrats at that point? That's right, but they can't dictate what the Republicans need to do with healthcare or any of these things because they're a minority party.

10:34They don't have the presidency. They don't have the House. They don't have the Senate. So if it gets shut down, the Schumer shut down. It goes back to the Obama administration. Elections have consequences. Those were the comments that he made. Whatever you want to attribute it to, they're going to try. They're saying right now that if it shuts down, the Republicans are the ones shutting it down. That's not going to. That dog won't hunt. Is that what you say? The other issue is political implications. I mean, Schumer really got hit last time when he gave Republicans the vote. When he said, hey, we need to go and do this.

11:03There were a lot of political backlash for it. And that is, as you consider sort of what's going to happen next, that is a factor you have to keep in mind. Right. The AOC Mamdani ticket he's worried about. President AOC. Is there a point that this starts to impact the economy, I would guess? You know, if this is more than what we've seen in recent history, just in terms of a few days shutdown or something like that. I wonder if it would impact the economy if it stretches out over a matter of weeks or even a month or longer. What we've seen in the past is that, you know, if it's just a couple days, if it's just a week, probably not going to have a ton of impact.

11:40But if this does wind up extending like we saw a couple years ago in 2018, 2019, I mean, that had I think it was$3 billion on the fourth quarter in December for a few weeks. And then I think it was about$8 billion on the start of the year in the first quarter. So, yes, this could absolutely have an economic impact. And remember, if there is a furlough, traditionally what we have seen is employees in a lot of these data gathering organizations, BLS, they wind up being furloughed, and that means less data for that upcoming Fed meeting in November. Emily, do you have a, can you name five things, what do they want?

12:14Five things. I mean, I've seen that there are some crazy asks about, I don't know, health care for people that aren't here legally. What do they want? What are they actually saying Republicans need to agree to for them to get on board? What do they want? I don't think we have enough time for me to give you the full answer. I'm just going to say the Affordable Care Act tax credits, that is the one to keep an eye on because that is the one that actually has bipartisan momentum. So they want that and Republicans are saying no at this point? They're saying that that's, Mike Johnson said that is a December policy issue, not a September issue.

12:47It seems like there could be a path forward, but there'd need to be a negotiation. And then if they do get an agreement, how long till we do this again? November 21st. if they go for the bill that Republicans are pushing for. I can't. I can't. The Ryder Cup's starting tomorrow. Emily, thank you. Important things. See you later. Cheese will be next. Still to come on Squawk Pod, expiring health care tax credits are a key sticking point in the negotiations to avert a government shutdown. New Hampshire Democrat Jean Shaheen says there may not be that much talking actually happening. Of course, there are lots of ways to get this done.

13:28And I think if people would get to the negotiating table, it's not that hard.

13:40This is Squawk Pod. This is Becky's mic. Three, two, one. Up and Becky, cue. You're watching Squawk Box right here on CNBC. I'm Becky Quick, along with Joe Kernan. Andrew is off today. With less than a week until a potential government shutdown, expiring health care tax credits are one of the main sticking points in negotiations between Democrats and Republicans. Join us now, New Hampshire Democrat Senator Gene Shaheen, who has been leading a push to extend the tax credits. Senator, it's good to see you. And you've got you've got some some Republican senators that seem to be have some empathy for what you're trying to do.

14:22But I'm not sure they're going to be able to or that you're all going to be able to agree on something before the stopgap. And everybody once says you can do it afterwards. Get this done and you can still get it done before November when everybody signs up for Obamacare. So there'd still be time. Is that an option? Well, of course, there are lots of ways to get this done. And I think if people would get to the negotiating table, it's not that hard. But the nonpartisan office of the Congressional Budget Office has said that if we wait until the end of the year, there are going to be a million and a half more people who are going to lose their health insurance if we do that.

15:00And what we know is that failure to extend those tax credits is going to see insurance costs rise for over 20 million people, and about 4 million people lose their health insurance entirely. So this is something that we need to address. As you pointed out, there are a number of colleagues on the other side of the aisle who also recognize that this is an issue that needs to be addressed. And I think if we could get the leadership to sit down at the table and talk about how we solve this, it's in everybody's interest to keep the government open and to make sure that people don't lose their health insurance.

15:35And when you have the president saying to the Republican leadership in Congress, don't talk to the Democrats, and then canceling meeting with the Democrats and Senator Thune saying he's not going to sit down and talk, that isn't conducive to getting a resolution. If we really are bluntly honest about it, are there other things that Schumer, that Senator Schumer and Democrats want to load this up with, you know, give them an inch and they'll take them out? Would it be possible just to get what you want? And if you did offer that, would there be some openings on the Republican side? Or is the problem, you know, is the problem that some of your colleagues on the Democratic side are asking for too many things?

16:20and they won't agree to whittle it just down to what you want. Because I know that Senator Johnson, he doesn't even want to do this. He thinks that there's fraud and that there are some Republicans that just don't want to do what you're talking about. But others are ready to do it. They just don't want to get taken to the cleaners with a bunch of other things. You know, I had a roundtable yesterday with a number of small business owners in New Hampshire who rely on those tax credits to help make sure their employees get health insurance and who themselves rely on it. And they talked about the impact it would have if those tax credits expire and their premiums go up dramatically, the number of their employees who were going to drop health insurance, unfortunately, because they're young and they're healthy, and if it gets hard and too expensive, they won't be able to do it.

17:12And then they also raised it in the context of tariffs. they all talked about how they're being affected by the rising tariffs. And that this, on top of that, just adds to the cost increases that are making it hard to operate. But you're not really answering it. I'm not answering your question because I think it's a bigger problem that you're not acknowledging. But in reality, let me just finish and answer your question. Because in reality, the problem is not that we can't find a solution to this. The problem is that the leadership is not going to the table and sitting down and negotiating, because if they negotiated, we could find a way to deal with this.

17:56We have Republicans who are interested in extending the premium tax credits. We recognize the other challenges with health care. But this is one that is in everybody's interest to extend. And the president should recognize that even his own pollsters say that if we don't extend these tax credits, the GOP is going to pay at the polls next year. Yeah. But you can imagine if, you know, you make that case to either Senator Thune or to the president and say, look, this is all we want. And then they hear, oh, they're going to want this and this and this and this and this. And because they're the majority party and they control, you know, the executive, they control everything at this point.

18:39So they don't if if they think that that there's going to be a lot of theater and kabuki and all these other things we need. You know, if you're going to shut the government, shut it. The president's doing kabuki theater. He's threatening to fire a bunch of employees if we don't keep the government open. I mean, so my point is everybody needs to stop the kabuki theater and go to the table and negotiate. That's what the American people are expecting. If you don't, and I don't know whether you can whittle it down to just what you want, but let's say that there is no negotiating. Would you think the Democrats should go ahead and not vote for it so that they, I won't say the Democrats shut it down because they'll say that the Republicans not negotiating with them is causing the shutdown.

19:26But do you think for whatever reason the government should we should allow the government to shut down? My position is it's in everyone's interest to keep the government open. That's the best course of action. And to make sure that we don't have millions of people losing their health insurance. But could you negotiate after the to do after the CR? We can do we can solve this. There are a number of ways to solve this problem. But in order to do that, you have to talk to each other. Yeah. OK. So so there there is a deal somewhere in there that I guess you just have to take their word for it that do the CR.

20:01And then before November, you'd have to agree to do this. I'm a believer in Ronald Reagan trust, but verify. I think if you get an agreement, it is keep the government open and we're going to agree that we're going to solve this problem with the premium tax credits or some other issue that helps ensure that the American people can keep their health care. What are the do you know what's likely to be in in addition to what you're talking about? What are other senators, Democratic senators, key priorities that they want to layer on to what you're talking about? I mean, you must know. Well, no, I don't, in fact.

20:41And I haven't heard people talking about layering on anything else. What I've heard is concern about ensuring that Americans can keep their health insurance. And I think that's an easy issue to solve. And we have people on both sides of the aisle who want to do that. Senator, thank you. Live free or die. I say that all the time. Good. We like it. Is your maple syrup better than Vermont's? Of course it is. I don't think I've asked you that. I've asked everybody else. Definitely better. I mean, it's proven to be better. And our foliage is more beautiful, too. Then Vermont. Wow. What about ice cream?

21:24Maybe they got the ice cream. No, Ben's gone or Jerry's gone. No, Ben and Jerry's Vermont. So we have our own ice cream at New Hampshire. You do? OK, you know what? I think I'd like yours more. Just from what I can tell. Thank you, Senator. Thank you. Next on Squawk Pod, Wall Street's newest public company, self-driving trucks. The CEO of Kodiak Robotics joins us. I don't know. I worry that truck could kill me. I shouldn't. You shouldn't. So safety is always our first priority. And the fast track to U.S. citizenship. Our Robert Frank on how the world's richest can become Americans. It's quick and not cheap.

22:07There has been a huge sea change around the world where the wealthy want to hedge their bets in their country. So they want a backup plan. They want a plan B.

22:24you're listening to squawk pod from cnbc here's becky quick welcome back everybody later this morning autonomous truck technology company kodiak is going to begin trading on the nasdaq after completing a spack transaction it's changing its name to kodiak ai and joining us right now on the potential benefits of ai powered trucking that means trucks that are driving themselves, is Kodiak's founder and CEO, Don Burnett. And Don, thanks for being here today. Thanks for having me. I did not realize how these things are already on the roads, at least down in Texas at this point. Why don't you describe what the trucks are, how they run, and what the AI component is?

23:04Sure. So trucking is obviously a huge part of the American economy. And one of the big challenges over the last several decades has been driver shortage and challenges that drivers face on the road. And so we've been working to automate the trucks with AI technology that allows them to effectively drive on their own. And our first commercial deployment is out in West Texas with a company called Atlas Energy Solutions. And we have now eight trucks that are fully driverless, meaning there's nobody in the cab out operating on a daily basis. And they're out driving. You picked this area of Texas because it's fairly remote.

23:41There's not a lot of traffic on the road, but there is other traffic. It's not a closed loop. Absolutely. So there's actually quite a bit of traffic, and in particular, there's a lot of close-quarter traffic. So we have a lot of oncoming vehicles, heavy trucks, big vehicles, pedestrians, pretty much everything you would find on any road network. But it is fairly remote, and it's a great place to first deploy the technology. But they're trying to go a certain MPH, obviously. If someone's in their way, they have the capability on a two-lane highway of passing? Absolutely. So we're operating off highway today, but yes, they can pass stop traffic.

24:16They can yield for other traffic. They follow all the rules of the road. All the rules still apply. Unlike most professionals are actually good. I'm shocked when a pro driver stays in the left lane and we're trying to get around. And it's like, I know you know better. I know you do because you're a pro. but so they're going to do what a what a really good um truck driver i'm worried about with with driving cars you worry about hey that's your if you want to go around a driverless car that's your problem you're not going to kill me one of these things on the road i worry about yeah i could be it could be coming i don't know i worry that truck could kill me i shouldn't you shouldn't So safety is always our first priority.

25:02And as you said, our trucks are programmed to be conservative. They're going to sit in the right-hand lane, minding their own business. They're not going to cut you off. If they're going to pass, they're going to pass cautiously. They're going to pass when there's an opening. And so they're going to abide by the speed limit. They never get drowsy. They never drive drunk. They're always paying attention 360 degrees around the vehicle. You have 3 ,000 paid hours of these driverless trucks to this point. Have you had any accidents, had any issues? We have not had any at-fault accidents with our system.