carol: welcome to "bloomberg businessweek". i am carol massar. oliver: i am oliver renick. carol: can a ceo lead the u.s. state department? the odds for and against rex tillerson success. and how did one of the most liberal and welcoming places in europe become a hot head for anti-globalization. oliver: all that ahead on "bloomberg businessweek". ♪ carol: we are here with editor and in chief. .megan murphy

you take a look at rex tillerson. can a ceo do the job? is talking about is he is facing a different set of challenges. he is facing a state department upended.up and he was cut out of the loop on a travel ban for people from seven predominantly muslim countries. it is an unprecedented situation. so while he is bringing in ceo management techniques, his reception has been quite positive. the challenge is not what we would expect it. is gettingge traction in the administration for a type of leadership style and development of americans foreign-policy. owns still building out his structure and face time within

the administration. to companies move and industries. in the realm of health care and drug prices, you look at one part of it, the middleman. megan: a little-known aspect of how our drug system works, and something that is under tremendous scrutiny with the price rises we have seen for certain drugs, and politicians looking at this practice. these are companies that sit in the middle and negotiate between drugmakers and pharmacies. sometimes taking the difference between the price of the drug from the manufacturer and the consumers, sometimes it using clawbacks to benefit their bottom line. that is their business. benefit managers keeping prices down for consumers, helping companies when they help manage their drug programs for employees, or other part of the problem that leads to price increases? there are people on both sides

of the arguments. some use the argument with caterpillar who basically dispensed with them. that is a corner of this market. $15 out of every $100 goes to p bm's. that's compared with four dollars and other countries. it is something that this article shines a light on. howl: interesting to see caterpillar cut back on their cause. this cover story is an individual liked by the president, like by steve bannon, a true insider. steve miller. megan: he was one of the most experience government hands in the administration. it delves into is he the thinking man. it is a fascinating look at him and a portrait of him, this star figure in the administration. interestings an

character. we talked reporter josh green. >> he is a longtime congressional staffer working jeff sessions. he spent his entire career and washington on the far fringes of national politics, but because he's signed on early with trump and help to shape drums anti- immigration worldview, he has ended up in a remarkably senior position. carol: i love your story. because of his it association with sessions that he got to trump so quickly? >> his association with sessions association with steve bannon, trump's chief strategist. sessions was the first mainstream politician to come out and endorse donald trump. he appeared at his rally and alabama, and that showed people

i think that there was an element in the republican base that really liked what trump was saying when not too many people, especially in the media, took him seriously. miller is somebody who has spent years developing sessions worldview, restrict immigration, tight labor markets. he put together the pieces of what the white house is calling economic nationalism, and so once trump needed a speechwriter, miller was an obvious person to fill that role. about all oflk these important people within ,resident trump's inner circle but he has government experience . >> when you look at how

many people had never worked a day in government before. it is very difficult to legislate, and miller is one of the only people in the senior levels of the white house who has any experience in congress at all. the difficulty for miller and for trump as i point out in this tease is that miller's time in the senate was spent halting agenda,t obama's knocked down immigration reform, which she was successful in doing, let sessions has never had a resume as an actual legislature, and one of the reasons we have seen the agenda stall is that there aren't people who have experience passing laws. oliver: he has found a unique henchmen to gos

to the morning shows and take the beatings and recites the president the agenda. tell us about his new public role. problem the white house has had is they don't have people who can effectively communicate trump's. sean spicer, the press secretary , is famously flustered of the podium. he has been mocked on saturday night live. kellyanne conway gets in trouble every time she goes on tv. she was cited by the government office of ethics for hawking i vanka's drums clothing line. miller is an effective communicator because ever since he was a teenager, he has been a regular voice on right-wing talk radio and is clear. he has a black and white view of used tod, and he is debating and arguing with people as we seen on the sunday shows, and if there's one thing we know president trump loves is his

people on tv making a forceful, forthright case for his policies , and that helps to explain miller success in the white house despite missteps. oliver: turning stephen miller into a cover model was the job of rob vargas. it plays to his somewhat aggressive personality and the way he defends trump and defends how truthful the things trump says are. he has this almost like very militant live to him. in the design of world constructivism, it is kind of big, so i decided to apply that treatment to the headline. oliver: the constructivism is the color scheme, the block layout? convey as meant to message very clearly and boldly,

and i think that is the essence of stephen miller. he doesn't mince words. he doesn't hold back, and there is a slight propaganda element to that, and so it felt appropriate for the subject matter. carol: up next, if not dodd-frank, then what? we look at financial reform under a republican controlled congress. oliver: and why some republican lawmakers are backing away from repealing obamacare. carol: this is "bloomberg businessweek". ♪

carol: welcome back to "bloomberg businessweek". i am carol massar. oliver: i am oliver renick. in the markets and

finance section, banking reform under a republican controlled congress. oliver: we look at what conservative banking regulation may or may not look like. will dodd-frank not be repealed and replaced this year. in might never be repealed and replaced. we might see some tweaks around the edges. i can't say for sure. there is a good chance he won't come close to getting rid of dodd-frank. oliver: how much of this will be a result of the surrounding him? mnuchin's testimony, they ask him about dodd-frank him and he did not seem like he wanted to tear the entire thing up. some of the language from some of trump's official seems to be not quite as extreme. gary cohn see some value in dodd-frank, while criticizing others. these are wall street types you don't like heavy regulation. i want to get into the general

concept here. there are two approach to financial regulation. the democratic approach is .asically you regulate these firms screwed up and brought the world into a financial crisis, and now we need to supervise them very tightly. the republican approach is that is what markets are for. marketharness the free by getting shareholders to discipline their unmanaged and's, and the way you get shareholders to have a bigger stake is to have higher capital standards. that is the difference between the assets and liabilities. the leading bill that is in the house belongs to the head of the house financial services committee. it gives firms and offramp from some of the supervision at the have a firms if they high leverage ratio, which is to say a high amount of capital on

their books. carol: how much political will is there to do something within congress? >> everybody wants to say they did something to when push comes to shove, there is not agreement on what to do. even if they manage to get something through the house, they don't have enough votes to get it through the senate, and it doesn't seem as if any of these wavering centrist democrats are willing to go along with a major repeal of dodd-frank. carol: dodd-frank was a huge piece of legislation. there is a lot of stuff in there, 70% to 80% has been implemented by financial firms. whether or not they are willing to start rolling back is a question. point. is a good one of the people i talked to was the head of the clearinghouse association. he told me, well, repeating dodd-frank is not the top of our list on things we want to do.

are bothers them the most the capital tests the fed reserve is putting on. dan tarullo is leaving now, and the hope of the clearinghouse and other groups is if trump manages to a .3 new fed governors, he might be able to twist the dial more towards easier capital regulation, which is even more importt r the banks to get rid of dodd-frank. oliver: how planned parenthood is turning out to be a landmine for republicans looking to repeal obamacare. it is definitely proving harder than i think trump and republicans in congress expected. what is making it even harder is the insistence by some of the most conservative members of the house to insert language into any repeal bill that the funds planned parenthood, a nonstarter for the senate, but a core issue

for your tea party wing or freedom caucus part of the house. they want to do this simultaneously. objectives.o long they have the power to do both, but if you try to do them together, planned parenthood can end up being this political landmine that causes problems through the spring. oliver: so here is what i think is interesting. if you have agreement among republicans, and this is an important topic they all want to get defunded, then where does the political landmine part of it come into account? is it that you will get zero democrats on board with any change in obamacare? are their opinions about planned parenthood within the republican party? >> sure, the freedom caucus is your tea party wing, your hard right flank of house republican majority.

they have enough votes, they are big enough, to determine that any sort of repeal bill gets out of the house has to get through them. they are insisting that any defundbill must parenthood. that is a nonstarter with the senate. any repeal they'll that comes out of the house and lands in the senate and of funds planned parenthood is going to have a edfficult time getting pass because the majority is so much then are over there. you have had to republicans in the senate who have said they are not cool with defunding planned parenthood as part of obamacare. oliver: so there is some division within the ranks. they have a pretty thin margin here. is it do or die for those people? can they work in some language that is partial or in between? freedommembers of the caucus are drawing lines, saying we were not agreed to any of obama care repeal the does not

include provisions to defund planned parenthood. they do have the numbers to hold that up, and this is a problem that is presenting itself at the feet of house speaker paul ryan. he has to get them in line. it is not clear they will play ball. carol: up next, the protectionist movement in one of the worlds most open and liberal societies, the netherlands. this is bloomberg. ♪

oliver: welcome back to "bloomberg businessweek". i am oliver renick. carol: i am carol massar. you can also listen to us on the radio. oliver: and in london, and in

asia on the bloomberg radio plus app. and the politics and policy section, the netherlands has been a center for global trade. the forces of protectionism and nationalism have gained a whole there, especially rotterdam. find this fascinating. until 2004, it was the world's providesort, and it 100 30,000 jobs in the city of 600,000. jobs in a city of 600,000. the city is dependent on it, and yet it is the city where this populist movement and the netherlands grew up. thatave this juxtaposition eight face value is difficult understand. carol: we kind of know what the pushback against globalization

looks like in the united states ourhow it has affected elections. what does nationalism look like in the netherlands? >> it is a little bit different. the netherlands is in a way the starting place of liberalism. for hundreds of years, this was you werehere if religiously persecuted in europe, you would go to the netherlands. it was always an open trading company. up as a feudal system that existed in the rest of the world, and more recently, it is famous for lack's attitude towards regulating prostitution, softer drugs, and so on, so you have this place that is very liberal, if you like. it is truly an ingrained, and if nationalism is a decision, we want to go back to what we were before, this golden era some time ago.

in the netherlands, of the aough, different than lot of countries, that golden era looks quite liberal, so even the nationalists and populous in the netherlands, they can be quite liberal on some social issue. so for example, a populist leader who grew up in the early 2000's and rotterdam, he was shot dead and assassinated in 2002. gay, soas flamboyantly what really angered him about muslim immigration was that here was this foreign culture that was encroaching on his house. fromo down a few streets his house and all the doorbells of names that are arabic names, turkish names, what ever, and he

found this threatening because he felt the dutch people were being forced to change their way of life because these immigrants came and were trying to impose their own way of life. oliver: in the features section, a story about another kind of politician, a formal bolivian vice minister for internal affairs. carol: and his work as an advocate for minors would -- miners would ultimately get him killed. >> there was a conflict surrounding a new mining law that the president had put into effect last year, and one of the things the mining law stipulated was that cooperatives could not go and partnerships with private companies, and this created a lot of tension. the mining corp. produces started to view morales scum of the supported as they helped he was basically a president who went into office

elected by people who are exactly like the minors, poor workers, largely indigenous, and they supported him, but as morales, his term when on over the years, people started to look at him as a populist authoritarian, that he was trying to take more control of more sectors of the economy. ers saw this attempt to prevent them from joining partnerships with private companies as something that would basically kill their productivity. they said they needed to go into these partnerships for the equipment the private companies could give them for the investment, and they solve this as an attempted state takeover of their sector by morales. essentially they turned on him, and so there was a growing conflict, growing tension, andeen these miners

morales, and interrupted in protest last august when the miners block the highways to protest. these were some of the most busy highways in bolivia, so it did paralyze parts of the country. interestingly enough, it was the same sort of protest that morales came to power on. carol: conflicting stories about what led to his death and whether or not the president was involved in allowing his death for his own political gain? what is interesting about this is that the murder theso shocking that in aftermath of it, bolivians looked at this as a chance to dissect what was going on in their country, and so different groups in the country basically depending on whether you are a backer of morales or an opponent took widely different views of

what caused this murder. example blamed the murder on external forces. he said the cooperatives had outside u.s.ted by back private companies who wanted to foment dissent within the cooperatives so that they would rise up against him. so he blamed outsiders on this. the people who were the opponents of morales blamed the president for basically throwing rodolfo illanes to the dogs. said he knew he would get hurt and that would allow ride a wave of popular outrage against the cooperatives and use that to his benefit, so there are conflicting conspiracy theories that have popped up out of this. carol: up next, can you to persuade its peers to pay for tv? oliver: this is "bloomberg businessweek".

♪

oliver: welcome to "bloomberg businessweek". i am oliver renick. carol: i am carol massar. koreanto incongruity conglomerates again. what to wear on job interviews this spring. oliver: all ahead on "bloomberg businessweek". ♪ oliver: we are back with megan murphy talk about some must reads in the magazine. let's talk about conglomerates in south korea and the sprawling influence they have. the article goes into

these family-run conglomerates. this goes into how over decades they have had a stranglehold on industries in south korea, but they continually face pressure corruption,ions of bribery, improper involvement with the government. to one ofwe are going those phases about how this is part and parcel of doing business and south korea. people really don't view this as a major business threat. what is interesting is on the political side how this goes all the way up to the president , so animating the left to push for change on the system which has squeezed corporate profit in the country. carol: there is a story about uber, one of the cofounders of uber, just when you thought the year could not get worse, it

can. of thethe original title story was terrible, no good, horrible month for a uber. it shows him and this angry dispute with one of his drivers, one of the drivers of uber black, and the thing is that he is a polarizing personality to put it mildly. he built this country which has made its money by pushing boundaries and pushing blasting orblac blow torching through walls. the prices you have a lot of people who frankly don't like arevery much, and they facing allegations of systemic sexual harassment with the company, which he has pledged to address. has brought in arlington huffington toledo probe. a lawsuit from google about their self driving

car platform, and this now shows travis defending his business, but if you are an anti-travis isson you are saying this him. oliver: it is fascinating to see how the skills that helped him take where the company is today, i'm going to get this done, thatack, it is now voracious this and pug nation's -- and pug -- megan: he needs to understand what it's like to take himself to the next level. he's not the leader of a startup in silicon valley. he is the leader of a huge country with an impressive vibration on the street. for manyllenging

leaders, but he does recognize that the sexual harassment issue is a problem. you hear from women throughout tech companies in silicon valley . they are not alone. he will be judged from this moment. either leaders come together for their employees and take their company ford and a different path, or sometimes you see them tumble. oliver: youtube. this is youtube giving tv shannels, hoping millennial are watching everything on mobile. they are not the first into the market and won't read the last, but it is ambitious. ready toillennials are pay $35 for 35 tv channels on mobile, it sounds interesting. it will be interesting to see whether they migrate fo to

that. carol: a reporter tried out youtube tv and we caught up with him. a youtube is launching virtual cable tv service basically, over-the-top, skinny bundle. you pay them $35 a month and you get the four top broadcast about 35 ord then so of their affiliated cable networks. there is no long-term contracts, and when you talk to youtube executives about this, they basically say we have been wanting to do this for six-eight years and it is finally coming to pass, and we think this will be a simplification of the tv experience. it will bring together all of your traditional tv and your online tv, one simple app. carol: who is going to hate you

to? the cable networks? who is it? >> they will be competing most directly over the past two years, there has been a number of similar services that have launched. dish launched two years ago, then at&t jumped in with directv now, and sony has playstation, so they will be competing with other services. hulu is supposed to launch a similar service later this year, and then at the same time they are competing with traditional cable and satellite tv providers. let's talk about the popularity of those items. i went you to give us some color on that. you talk about playstation vi directv, what kind of numbers, they seem kind of miniscule. has been slow himself are

the adoption of these services. sling tv has upwards of one million customers, but you think about the overall market, there are 120 households in the united states with some form of tv, so none of these services have been a huge home run yet. carol: does that mean they are not profitable? anybody isthink making money from these services. these are loss leaders for these companies. basically because they charge too little. the prices are still low, $20, $30, $40 a month, and the distributors are still having to pay for what is very expensive programming. holy grail is the here? even apple, microsoft, amazon, everybody is doing this. why everybodying wants to distribute the cable

bundle. and google'ss perspective, they think it makes sense because youtube has had this long ambition to be the one place you go for every kind of video in the world, and they pretty much have everything except your traditional tv packages come in so they are completing the whole menu. googleother perspective, is a huge advertising company, and this gives them entrée into this large, live, linear television market. they will not have a lot of control over the tv ads you see from the start, but they will get that data and more information. carol: up next, an unlikely development battle in los angeles. oliver: plus, artificial intelligence moves to the tennis court. carol: this is "bloomberg businessweek". ♪

oliver: welcome back to "bloomberg businessweek". i am oliver renick. carol: i am carol massar.

and financets section, propose construction been hitting builders, the mayor, and advocates for the homeless against the aids health care foundation in los angeles. >> it is an interesting, complicated owlet measure debate we are having in los angeles. which is nothing new. the city has new development all the time, and the zoning laws haven't been changed in 20 years, so there is constantly animosity about whether to build or not build. the interesting thing about this one is that the plans propose, s, would stop most development and the city for two years, and the primary funding party to this ballot measure is the aids health care foundation. given $4.6ion has million, almost 99% of the funds in support of this measure, which is interesting. carol: the question i wrote is

what is up with that? oliver: i thought it was a typo that it was funded by an aids foundation. carol: i'm thinking if i give money to support this foundation in cause and find it is going to political uses to support a valid issue to do with development and alley, i don't know i would feel so good about that. that has been a big point of contention. the aids foundation and their president say they want to use this moratorium on building to give the city council a chance to take a step back and re-examine the zoning laws and change the general plan in the city. voiced he wants to give a to people who are in need of affordable housing, the homeless population, but critics have noticed that quite a significant sum of money, and granted the aids health care foundation had a budget of more than $1 billion this year, so it is a small

percentage, but $4.6 million is a lot of money. carol: why is this foundation involved in an issue having to do it l.a. development? >> as i mentioned, they say they want to take a chance to give the city council the opportunity to read to the zoning laws, but critics have noticed that in about spring 2015, michael weinstein and the aids health care foundation filed a lawsuit against the developer that was high-risewo luxury apartments right next door to their hollywood offices. they claim to these buildings broke the law and were outside the zoning laws, and has succeeded in pausing this development, and critics have said that measure s and the aids health care foundation support have been an extension of that. inthey don't succeed

stopping these two high-resolution apartments, then they want to stop all development in the city, and that is what critics are saying. oliver: a french inventor could put an end to fighting on the tennis court using artificial intelligence. has cooked up guy a $200 gopro sized device that ai tennis line reading capabilities of more expensive camera setups. carol: do you play tennis? >> a little bit. carol: what is this called? >> in out. oliver: either the ball is in or out. is this making all boys irrelevant? is giving you real-time stats on where your shots are landing within a 20 millimeter fastn of error and how spinning and what direction and that kind of stuff. carol: when people play tennis they fight over or debate that was in come that was out.

did you take a look at it? did it look well? wentreporter ashlee vance to meet with him and shoot with him for an hour or so. every time he missed a shot, the device would be to indicate the call was out or wide. itver: i like you phrased that way. tell us about the origin here. he is not really a renowned inventor. he's not a big programmer. it seems like this is something that came about for him. >> right, it wasn't a particularly well-known guy, but born in paris and describes him -- on court. there are a lot of stories about arguments or heated arguments with friends and family that

started with a mark on somebody's shoe. carol: is it expensive, this device? no, the big appeal -- the technology has been available and some form or another for a few years but at higher prices. sony manages show courts for grand slam tournaments with a dozen or more cameras, call the hawkeye system, and that sort of than whatore accurate we are talking about here, a margin of of error of three millimeters, but it costs $60,000 to set up. if you want to set up this kind of line reading for your own home matches, you pay $200 for this thing you connect to the net and present but. oliver: we are talking millimeters. >> that's right. oliver: that's crazy. in out hoax up to the net itself. where is the camera looking?

is it about whether it falls out on one end or does it take the entire shape of the playing area into account? facinge is one camera each direction when you hook it to the net. it will scan the lines to get a clear reading of where everything is, and then will track the ball's in either direction as they are moving across the court. the one technical glitch that in doubles play, it can be tough 's tone of these in out account for the second player on the court, so the inventor says two.oubles play, buy oliver: norman foster talks about what makes a green airport. carol: plus the very best of spring fashion. that is ahead on "bloomberg businessweek". ♪

carol: welcome back to "bloomberg businessweek". i am carol massar. oliver: i am oliver renick. you can also catch us on the radio on serious xm 119, 99.1 in dc.ington, in the focus on infrastructure session, a q and a with british architect norman foster, the goto for building airports. old architectyour who is probably one of the most architects and

most prolific living architects on the planet. he has designed everything from a building in germany to apartment towers in china, to bloomberg headquarters in london. oliver: i did not even realize his age, but it is pretty and impressive. you can feel the excitement emanating from this project, a new airport in mexico city. >> that's right. he just won the competition to airport of tomorrow for mexico city in conjunction with this architect, who is carlos slim's son, the mexican billionaire. and this is not lord foster's first airport. he actually trained as an raf himself, oro flies

at least flew himself, and has designed a dizzying array of airports. if you think about the number of new airports that have gone up in the last couple of decades, there's not that many come and he has managed to design airports in hong kong. he redid the airport, his first one. he has done 6-7 airports and design several more. carol: we want to get into the design for mexico city, but is he known for a certain type of architecture? are there certain things he does that you will always see? i think that anything i would say it would be fundamentally wrong because he has done so many different projects. carol: so not necessarily predictable? necessarily predictable. that said, he does favor transparency, glass spaces, cathedral-like interiors, so

that is not a rebuilding he has done, but you certainly don't see close, heavy spaces. carol: which is what you often feel and an airport. oliver: that is the opposite. he is trying to create some space per let's talk about the design. it looks really cool. you can see the photos in business weekend online. these are the renderings, because they have not started building yet, but what he has presented, there is a lot of transparency to it and it has this huge open area, multiple football fields. >> it is over 400,000 square -- it, and it is designed is supposed to be built in 2022 or 2020, but it is designed to 40-50 years into the future, so they want to be able to accommodate growth and

anacity that will reflect increasing propensity for global air travel, and so he has designed this colossal space aat really does seem like massive convention center as opposed to an airport itself. entire practice is about trying to make more intuitive in airports and a gateher sort of arrival to to plane experience. giant, but at least the way the renderings show it, you will not feel that way as you are wondering through. carol: speaking of design, let's get to the etc. section and the focus on spring fashion. outhe thing you want to put when you put together the

wardrobe for the office is most of us are inclined to wear traditional stuff, stuff we find to be what our peers are wearing. somewe have done is take of the runway styles and make them more office appropriate and applicable, and we do that with everything from victorian florals to what we are calling utilitarian chic for guys. carol: you have one' section that is white, layering for women, kind of interesting. >> we are seeing a lot of that weird we are seeing angles we have not seen before. looking at are wide length pant. lines,also seeing verticals and horizontals mixed and matched, which people tend to shy away from because they think they will screw it up. oliver: i have to address my o.7- ite one, hawaii

>> we are very much back with the hawaiian shirt. one, you want to make sure the rest of your outfit is tame. also, it has to be tailored. covering the like great outdoors, kind of like hiking gear. oliver: you have pockets. >> you want to think about things you might wear outdoors and the ways they are being tailor-made towards office appropriate gear, the pockets you see on safari gear. is takingot of this cues from the fashion shows in new york and paris, making it more appropriate for the office. >> the key is to look at what is

going on on the runways, then distill at a little bit so you can apply to a wardrobe and away you are comfortable with. carol: "bloomberg businessweek" is available on business stands now. oliver: also online at bloomberg.com. carol: opening remarks. we heard about it. it takes a look at rex tillerson doing his job as secretary of state. some say he has the perfect skills and demeanor. others say he may have party been sidelined by the white house. there is speculation that in order to do the job, he will have to defy the man who gave him that job. we are talking about donald trump. that could be difficult. how about you? story, a enjoyed the tragic story, about the bolivian government official and the complications surrounding his murder. it is an interesting look at how the commodities industry plays an integral role, especially in latin america.

it is a tragic story, but compelling. carol: it raises questions about the president himself. oliver: absolutely. more bloomberg television starts right now. ♪

♪ on "bloomberg best" the stories that shaped the weekend business around the world. >> the dow talking 21,000 for the first time. recordsts reached new and investors responded to donald trump optimistic tone of congress. effort to taken an restore job crushing regulations. >> but did his message fan the flame of the current market rally? >> healthier markets are things he is hoping for. >> the public equity market enjoys what the president is talking about. >> with recent economic growth translates a rate hike? the ides