WEBVTT - Inside Labor’s plan to fight tariffs

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<v Speaker 1>From Schwartz Media. I'm Daniel James. This is seven AM.

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<v Speaker 1>Australia is a small player in global trade compared with

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<v Speaker 1>giants like the US and China, so when the world's

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<v Speaker 1>two biggest economies embark on a trade war, we feel

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<v Speaker 1>the impact. Donald Trump's knew tariffs on China could send

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<v Speaker 1>shock waves through the Australian economy, affecting everything from iron

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<v Speaker 1>ore exports to the cost of everyday goods. Australia is

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<v Speaker 1>making the case that tariffs don't make economic sense, but

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<v Speaker 1>with Trump, the usual rules don't apply. Today Chief political

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<v Speaker 1>correspondent for the Saturday Paper Karen Barbo on how Australia

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<v Speaker 1>is navigating a trade war it can't control and what

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<v Speaker 1>happens if Trump doesn't listen. It's Monday, February ten. Karen.

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<v Speaker 1>When news broke that Trump had started hitting Canada, Mexico

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<v Speaker 1>and China with tariffs, he paid Australia's trade minister visit.

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<v Speaker 1>What did he tell you about how big a deal

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<v Speaker 1>this is for Australia.

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<v Speaker 2>Yeah, I had time with the Trade minister this week.

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<v Speaker 3>I mean, with all that's going on and talking to

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<v Speaker 3>like a full board trade war, do you think free

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<v Speaker 3>trade is under threat at the moment. Well, no Don

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<v Speaker 3>Farrell or the Donners is known. He's Australia's top trade negotiator,

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<v Speaker 3>is a top labor.

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<v Speaker 2>Pal broker from the right faction.

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<v Speaker 3>He wants to evoke this sense of calm in the

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<v Speaker 3>mailstroom while we're getting hit every single day with what's

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<v Speaker 3>coming out of the Trump administration. He wants to get

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<v Speaker 3>the message out that Australia has this in hand and

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<v Speaker 3>despite the other Donald's big stick approach you with the

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<v Speaker 3>rest of the world, this is something that he can

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<v Speaker 3>address in what he says, cool calm and collected way.

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<v Speaker 4>Now, cool calm and collective way of prosecuting the arguments

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<v Speaker 4>has been successful. I will it be with Trump?

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<v Speaker 1>Well, I will tell.

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<v Speaker 3>But we are talking about two of the top world economies,

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<v Speaker 3>US and China slapping these sanctions on each other. And

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<v Speaker 3>then we've got this middle power Australia and what it

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<v Speaker 3>means for us. But this is going to be a

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<v Speaker 3>top mission for him. As soon as his US counterpart,

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<v Speaker 3>Howard Lutnik is confirmed as the Secretary of Commerce, he

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<v Speaker 3>will be right in front of him and he wants

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<v Speaker 3>to get Australia's message out there like.

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<v Speaker 1>It's a tail of two dons. And so how is

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<v Speaker 1>the government preparing for any impact on Australia.

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<v Speaker 3>Well, the government wants to let Australians know in the

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<v Speaker 3>first that it's done its homework. Trump and Lucknik have

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<v Speaker 3>been flagging what they are doing right now for months.

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<v Speaker 1>I think we should put tariffs on.

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<v Speaker 4>Stuff we make and not put tariffs on stuff we

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<v Speaker 4>don't make.

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<v Speaker 1>It's pretty simple, and of course it's a barkling ship.

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<v Speaker 3>The Treasurer Jim Chalmers has also been talking about what

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<v Speaker 3>the tariffs mean. He has revealed that he directed Treasury

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<v Speaker 3>to do modeling on the possible consequences of trade tensions.

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<v Speaker 3>We have.

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<v Speaker 5>We actually did a bunch of work with the Treasury

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<v Speaker 5>and other colleagues before the election, anticipating either outcome, and

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<v Speaker 5>I've had the ability to brief my colleagues on a

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<v Speaker 5>number of occasions.

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<v Speaker 3>Over the past few months. We've had work being done

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<v Speaker 3>by the Trade Department. Also, we've had Penny Wong as

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<v Speaker 3>a Foreign Minister, talked to Marco Rubio. We've had this

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<v Speaker 3>mission now by the Defense Minister, the Deputy Prime Minister

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<v Speaker 3>Richard Miles to talk to Pete Heigseeth, the Defense Secretary

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<v Speaker 3>of the United States. It's all like this, three ministers

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<v Speaker 3>going out as soon as possible to say, well, we

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<v Speaker 3>don't need to do this.

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<v Speaker 2>Guys.

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<v Speaker 1>Can you give an idea of what the trade relationship

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<v Speaker 1>is like between Australia and the US.

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<v Speaker 3>As it stands, trade with the United States is worth

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<v Speaker 3>seventy seven billion US dollars annually and you know within

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<v Speaker 3>that fifty two billion dollars to the United States and

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<v Speaker 3>they've brought back twenty five billion dollars. So there is

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<v Speaker 3>a surplus situation here. Australia is one of the top

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<v Speaker 3>four nations in the world with a surplus. And it

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<v Speaker 3>doesn't make economic sense. This is the message from the

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<v Speaker 3>Albanese government. It doesn't make economic sense to slap tariffs

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<v Speaker 3>on us. And look what we're talking about here. We've

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<v Speaker 3>got to take a step back and go, hey, why

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<v Speaker 3>are we even talking about this. You know, Australia is

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<v Speaker 3>a long term political strategic ally of the United States. Well,

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<v Speaker 3>as Don Farrell tells me in the interview that we had,

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<v Speaker 3>it's not just about Australia. He'll be actually advocating for

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<v Speaker 3>the United States not to do what it's currently doing

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<v Speaker 3>to China, which is this tariff war that's emerging.

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<v Speaker 4>Oh, there's no doubt that can increase in Chinese terrorists

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<v Speaker 4>to the United States would have an impact in Australia.

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<v Speaker 3>That means a lot to Australia because Australia's largest trading

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<v Speaker 3>partner by far as China.

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<v Speaker 4>But we would be advocating for no terrorists on Chinese products.

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<v Speaker 1>So Don Farrell is more concerned about how they will

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<v Speaker 1>impact China and the knock on effect that we'll have

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<v Speaker 1>for Australia's relationship with China in a trade sense.

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<v Speaker 3>Yeah, it's a rare argument that Australia would go into

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<v Speaker 3>bat for such a large superpower, But there is self

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<v Speaker 3>interest there and that you know, this could slow demand

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<v Speaker 3>for big ticket items such as iron ore. You know

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<v Speaker 3>that iron ore is what we sell to China, is

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<v Speaker 3>a significant part of Australia's budget. This is something that

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<v Speaker 3>could raise prices for goods from China. This could affect inflation,

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<v Speaker 3>It could raise prices of goods here in Australia.

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<v Speaker 4>But not to say don't do it to ours something

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<v Speaker 4>we have a strong argument I think as to why

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<v Speaker 4>they shouldn't do it to US, but we're saying, look,

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<v Speaker 4>free and fair trade is not just in Australia's interest,

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<v Speaker 4>not just in China's interesting, but in the longer tournament's

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<v Speaker 4>in the interests in the United States.

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<v Speaker 3>So when you finally get to have a chat with

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<v Speaker 3>girl soon to be counterpart, that would.

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<v Speaker 2>Be one of your main messages.

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<v Speaker 3>This should be a very simple argument that Australia is

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<v Speaker 3>putting forward.

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<v Speaker 2>But it's very hard to say how things are going

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<v Speaker 2>to go.

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<v Speaker 1>Coming up after the break. Who's better at handling Trump,

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<v Speaker 1>labor or the coalition? Karen the Trade Minister's meeting with

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<v Speaker 1>his US counterpart, Patty Wong, has met with hers. Richard

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<v Speaker 1>Miles has been doing the same. But we recently spoke

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<v Speaker 1>to Malcolm Turnbull on seven AM. He said, the only

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<v Speaker 1>relationship that really matters is the one between the PM

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<v Speaker 1>and Trump himself. So what's Albanezy doing to prosecute Australia's case.

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<v Speaker 3>Well, at the moment, and remember we're not in the

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<v Speaker 3>official campaign, but essentially we're in campaign mode and so

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<v Speaker 3>he's been very guarded when he's been asked about Trump.

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<v Speaker 3>He's been very pointed saying that he's not going to

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<v Speaker 3>run a daily commentary on daily actions from Donald Trump

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<v Speaker 3>and all his decisions. But he does cite that there

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<v Speaker 3>is a quad meeting due in June. That's the leaders

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<v Speaker 3>of the United States, Japan, India and Australia, and so

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<v Speaker 3>that would happen after the election, which must be held

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<v Speaker 3>by May seventeen.

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<v Speaker 2>But you know, he's very much leading it to the

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<v Speaker 2>ministers at.

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<v Speaker 3>This stage while he concentrates on the domestic campaign. I

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<v Speaker 3>don't think he wants to start some sort of fight

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<v Speaker 3>with Trump in the middle of a domestic campaign.

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<v Speaker 2>So let's leave it to the ministers.

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<v Speaker 1>The coalition is claiming they would be better place to

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<v Speaker 1>handle our relationship with the US. So how did the

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<v Speaker 1>coalition fair dream last truck presidency?

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<v Speaker 3>Yeah, so, referring to Malcolm Turnbull, you know he often

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<v Speaker 3>says that he got Trump's measure, even though you know

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<v Speaker 3>there's the power of the United States presidency. He says

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<v Speaker 3>he stood his ground and he's not afraid now that

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<v Speaker 3>he's not Prime Minister anymore, to say that he is

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<v Speaker 3>a bully.

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<v Speaker 1>Trump is a bully.

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<v Speaker 3>He encourages people to suck up to him, you know, notoriously.

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<v Speaker 3>I didn't do that. I mean, that was partly my

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<v Speaker 3>personality and partly circumstance.

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<v Speaker 1>But I think it was a good thing.

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<v Speaker 3>But you know, we certainly Dutton Peter Dutton says that

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<v Speaker 3>the Coalition and Trump have a lot in common and

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<v Speaker 3>they could work really well together. But don Farrell immediately

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<v Speaker 3>scoffs at the suggestion that that is reality, and he

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<v Speaker 3>points to the China situation in that the whole relationship

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<v Speaker 3>with Australia's largest trading partner blew up under the Scott

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<v Speaker 3>Morrison Prime ministership when he questioned the origins of the

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<v Speaker 3>COVID nineteen pandemic and that led to like twenty billion

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<v Speaker 3>dollars in trade sanctions against Australia, of which Australia is

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<v Speaker 3>just getting over, still recovering. Don Farrell says that he's

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<v Speaker 3>in fact got nine meetings with his counterpart. Things are

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<v Speaker 3>going swimmingly and this is part of this message to

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<v Speaker 3>the Australian public in that what the government has done

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<v Speaker 3>with China, Farrell says that the government will do with

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<v Speaker 3>the United States.

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<v Speaker 1>Karen, how much harm could Trump's love of tariffs end

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<v Speaker 1>up doing, not just to America's training partners like Australia

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<v Speaker 1>and China, but to the United States itself.

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<v Speaker 2>Well, I did speak to Justin Wolfis about it.

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<v Speaker 3>He's a professor of economics and public policy at the

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<v Speaker 3>University of Michigan. He's an Australian who's used to be

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<v Speaker 3>on President Biden's Bureau for Economic Research. He just says,

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<v Speaker 3>we know exactly what he's doing in that these US

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<v Speaker 3>threats are to get exactly what he wants. He's thoroughly protectionists,

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<v Speaker 3>and so far it's working, so Canada, Mexico, and Colombia

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<v Speaker 3>back down within days. But it's ultimately self defeating and

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<v Speaker 3>that when you're talking about like self interest. Ultimately you

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<v Speaker 3>might be getting your foreign policy aims, but at the end,

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<v Speaker 3>there's a United States consumer who's experiencing increased prices in

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<v Speaker 3>the middle of a cost of living crisis that is

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<v Speaker 3>going to bite. So, you know, he describes it as

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<v Speaker 3>Trump is basically punching the American consumer in the mouth.

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<v Speaker 3>At first, it looks like Donald Trump is getting a win,

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<v Speaker 3>and that's very important to the United States president. But

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<v Speaker 3>you know that would have to play out over a

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<v Speaker 3>period of time, and you know, the administration only goes.

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<v Speaker 2>For four years.

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<v Speaker 1>Is that all Karen? Thank you so much for your time.

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<v Speaker 2>Thank you.

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<v Speaker 1>Also, in the years today, the federal government has committed

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<v Speaker 1>more than half a billion dollars to women's health, including

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<v Speaker 1>spending on long term contraceptives and menopause treatments. The government

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<v Speaker 1>has also added some of the most popular contraceptive pills

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<v Speaker 1>to the Pharmaceutical Benefit Scheme, a move that will lower

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<v Speaker 1>the price of the drugs, benefiting an estimate of fifty

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<v Speaker 1>thousand women. And Australia has paid the United States an

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<v Speaker 1>eight hundred million dollars down payment for its future submarine

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<v Speaker 1>production as part of the Orcus Agreement. In a meeting

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<v Speaker 1>with Australian Defensive Minister and Deputy Prime Minister Richard Males,

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<v Speaker 1>US Defense Seestry Peter Hexath said US President Donald Trump

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<v Speaker 1>is aware of and supportive of ORCUS. The agreement is

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<v Speaker 1>expected across Australia up to three hundred and sixty eight

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<v Speaker 1>billion dollars over thirty years. I'm Daniel James. This is

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<v Speaker 1>seven am. Thanks for listening.