WEBVTT - Trump Delays Mexico Tariffs 0:00:00.080 --> 0:00:09.960 Boo Bloomberg Audio Studios, podcasts, radio news. You're listening to 0:00:10.000 --> 0:00:13.720 the Bloomberg Balance of Power podcast. Catch us live weekdays 0:00:13.720 --> 0:00:16.720 at noon and five pm Eastern on Apple Coarclay, and 0:00:16.720 --> 0:00:20.119 Android Auto with the Bloomberg Business App. Listen on demand 0:00:20.160 --> 0:00:25.080 wherever you get your podcasts, or watch us live on YouTube. 0:00:25.640 --> 0:00:28.480 After the call with Canada, you'll need to stay with 0:00:28.600 --> 0:00:29.360 us all day here. 0:00:30.000 --> 0:00:32.720 Charlie will certainly be watching. What was that dow? 0:00:32.800 --> 0:00:34.760 Down six hundred points at one point, we're looking at 0:00:34.760 --> 0:00:36.600 a seventy five point loss. Of course, this has a 0:00:36.640 --> 0:00:39.279 lot to do with the progress in Mexico. And then 0:00:39.280 --> 0:00:41.440 we're counting down to a three o'clock call, three pm. 0:00:41.520 --> 0:00:44.800 Will it be a perfect call? Donald Trump and Justin 0:00:44.840 --> 0:00:49.560 Trudeau talking about the implementation tomorrow of twenty five percent 0:00:49.640 --> 0:00:53.920 tariffs across the board. The US national anthem was booed 0:00:54.040 --> 0:00:57.720 by hockey fans on Saturday in Ottawa, booed last night 0:00:57.800 --> 0:01:02.920 by NBA fans in Toronto. I don't know what they're 0:01:02.960 --> 0:01:05.399 singing today in Mexico, but the market's certainly like the 0:01:05.440 --> 0:01:07.520 idea that Donald Trump had some time to talk with 0:01:07.600 --> 0:01:15.720 Mexico's president, and sure enough, the tariffs are delayed, as 0:01:15.720 --> 0:01:20.440 we heard earlier from the President of Mexico, who takes 0:01:20.520 --> 0:01:23.720 us inside the phone call with Donald Trump speaking through 0:01:23.720 --> 0:01:24.360 a translator. 0:01:24.360 --> 0:01:25.080 Here, let's listen. 0:01:26.440 --> 0:01:28.800 Then he agreed and at the end asked me how 0:01:28.880 --> 0:01:32.119 much time I wanted to put on pause. I said, well, 0:01:32.440 --> 0:01:35.720 let's put it on pause forever. And he asked how long. 0:01:36.200 --> 0:01:38.320 I said, let's put it on pause for a month, 0:01:38.959 --> 0:01:40.800 and I am sure that in that month we will 0:01:40.840 --> 0:01:43.919 be able to have results, good results for his people 0:01:44.280 --> 0:01:45.600 and good results for Mexico. 0:01:47.840 --> 0:01:52.360 Claudius shinbah, Let's put it on pause forever, and he asked, 0:01:52.400 --> 0:01:53.200 now how long? 0:01:54.160 --> 0:01:54.520 It does? 0:01:54.600 --> 0:01:57.320 Make you wonder the substance of these calls and maybe 0:01:57.320 --> 0:02:01.760 something similar? Could something similar happen with Canada later on today? 0:02:02.280 --> 0:02:05.360 Knowing that Mexico pledged ten thousand troops to stand along 0:02:05.360 --> 0:02:09.120 the border to keep drug trafficking and illegal immigrants out, 0:02:09.200 --> 0:02:11.400 keep the fentanyl owed, is there a similar agreement that 0:02:11.440 --> 0:02:16.520 could be struck today with Canada. Doesn't appear clear to 0:02:16.600 --> 0:02:18.200 us at this moment, which is why we need to 0:02:18.200 --> 0:02:19.520 wait for the readout on this call. 0:02:20.280 --> 0:02:20.400 Now. 0:02:20.440 --> 0:02:22.840 Vin Gary Shankar is wondering what happens as well. That's 0:02:22.880 --> 0:02:25.040 why we have the president of the Economic Security and 0:02:25.120 --> 0:02:29.000 Technology Department at CSIS with us right now. Former Senior 0:02:29.000 --> 0:02:32.839 Official Department of Congress, Navin I'm sure you never heard 0:02:32.880 --> 0:02:35.280 of a moment quite like this where we have things 0:02:35.360 --> 0:02:37.399 knocking around. It's going to be different from one hour 0:02:37.440 --> 0:02:40.280 to the next. It appears over the course of the day. 0:02:40.320 --> 0:02:42.960 I'm supposed to ask you about the impact of tariffs, 0:02:42.960 --> 0:02:46.240 But is that the point of this conversation, or are 0:02:46.280 --> 0:02:50.040 we simply using these bargaining chips to exact concessions from 0:02:50.080 --> 0:02:53.880 our neighbors with no real intention of ever implementing them. 0:02:54.560 --> 0:02:56.200 Well, thank you and joy, it's great to be here. 0:02:56.240 --> 0:02:59.839 It certainly seems like the use of AIPA the Emergency 0:03:00.000 --> 0:03:04.840 Economic powers to institute these tarrs are designed to achieve 0:03:04.960 --> 0:03:09.400 some ends with respect to fentanyl interdiction. Fentanyl is a 0:03:09.440 --> 0:03:12.600 serious public health issue and deserves the attention of the 0:03:12.600 --> 0:03:17.359 President's given it. However, the real question is whether the 0:03:17.400 --> 0:03:20.440 potential trade war that we're facing down right now is 0:03:20.480 --> 0:03:24.360 really worth the risk in terms of addressing what is 0:03:24.440 --> 0:03:31.639 essentially a joint law enforcement and integers interdiction type of 0:03:31.720 --> 0:03:32.760 effort that's required. 0:03:34.120 --> 0:03:36.640 Well, So is this a trade war or a drug war? 0:03:36.680 --> 0:03:38.920 The White House was using the latter term this morning. 0:03:40.400 --> 0:03:43.000 Well, I would say that we looks like we're on 0:03:43.040 --> 0:03:47.040 the precipice of a trade war, unless you know, we're 0:03:47.040 --> 0:03:51.880 at T minus one or less because these tariffs going 0:03:51.920 --> 0:03:56.160 to effect at twelve one am on February fourth. The 0:03:56.280 --> 0:03:59.640 dance between Mexico and the US right now perhaps is 0:03:59.640 --> 0:04:03.600 a way to forestall that. The real question is shouldn't 0:04:03.600 --> 0:04:06.600 we be fighting a tech war, because that's really what 0:04:06.680 --> 0:04:09.480 the issue is as far as economic security of the 0:04:09.560 --> 0:04:12.800 United States is concerned. And I think that this may 0:04:12.840 --> 0:04:15.920 actually be ultimately somewhat of a distraction from what we 0:04:15.960 --> 0:04:21.560 should be focused on, and certainly I think the administration 0:04:21.640 --> 0:04:24.960 is aware of this. But again, the question is about focus. 0:04:26.160 --> 0:04:29.000 Okay, So Navin introduces an interesting idea here and a 0:04:29.040 --> 0:04:33.240 smart question. By the way, Navin, no one's talking about 0:04:33.320 --> 0:04:36.400 the ten percent tariffs against China, which are more likely 0:04:36.480 --> 0:04:39.640 to be implemented or kept in place, I would argue, 0:04:40.040 --> 0:04:43.680 than the Canadian or Mexican tariffs. We've talked recently about 0:04:44.080 --> 0:04:48.320 turning the screws on export controls for high tech GPUs, 0:04:48.440 --> 0:04:50.919 the advanced stuff that Nvidia is selling for instance. 0:04:51.440 --> 0:04:52.919 Is that the direction you're looking at? 0:04:52.960 --> 0:04:56.000 And why are we talking about Mexico and Canada if 0:04:56.000 --> 0:04:56.880 that's the case. 0:04:58.200 --> 0:05:00.320 Well, the reason we're talking about Mexico and ca Canada 0:05:00.440 --> 0:05:05.159 is because the North American economic ecosystem is highly integrated. 0:05:05.680 --> 0:05:10.760 Those players have much to lose given their export exposure 0:05:10.800 --> 0:05:14.080 to the United States. But with respect to China, the 0:05:14.160 --> 0:05:16.600 ten percent tariff, remember what they had priced in with 0:05:16.680 --> 0:05:19.640 something like sixty percent tariffs based on what the President 0:05:19.680 --> 0:05:22.520 had said during the campaign, So this is much lower 0:05:22.560 --> 0:05:24.599 than that. We will feel the hit here in the 0:05:24.720 --> 0:05:30.120 US on things like electronics and other types of goods 0:05:30.120 --> 0:05:33.359 and services like that from China. But I think the 0:05:33.400 --> 0:05:36.200 bigger question, which you pose is an important one, is 0:05:36.240 --> 0:05:39.839 we should be thinking the economic relationship with China covering 0:05:39.880 --> 0:05:45.480 a number of economic security tools, trade, export controls, investment screening, 0:05:46.640 --> 0:05:50.200 and other types of measures that are intended to actually 0:05:50.680 --> 0:05:54.400 strengthen the US's hand with respect to the technology competition 0:05:54.480 --> 0:05:58.200 that is now accelerating across a number of technologies. 0:05:59.320 --> 0:06:02.080 If the FED is coming from China and going through 0:06:02.120 --> 0:06:05.320 Mexico and Canada to get here, most of it through Mexico, 0:06:06.760 --> 0:06:09.480 that also can change the way you're looking at this 0:06:09.680 --> 0:06:12.359 drug war. Why don't we go to the source instead 0:06:12.360 --> 0:06:13.640 of unplaced partners? 0:06:14.680 --> 0:06:17.080 One hundred percent? And as you'll recall, during the Biden 0:06:17.160 --> 0:06:21.560 administration there was an agreement with presidency to work on 0:06:21.640 --> 0:06:24.720 that issue. I think you have certainly put your finger 0:06:24.800 --> 0:06:28.360 onto a really important issue, which is the source. And 0:06:28.400 --> 0:06:33.480 I think that is a curious decision to prioritize what 0:06:33.600 --> 0:06:37.080 is in effect harder measures with Mexico and Canada right 0:06:37.120 --> 0:06:40.560 now relative to the Chinese. Who knows what's coming down 0:06:40.600 --> 0:06:43.520 the pike in terms of the game plan of the administration, 0:06:43.640 --> 0:06:47.279 but sequencing matters, and so now we're going to focus 0:06:47.320 --> 0:06:53.880 on our closest allies relative to what is our principal competitor. 0:06:55.279 --> 0:06:58.080 Nac A headline just crossing the terminal. Secretary of State 0:06:58.120 --> 0:07:02.280 Rubio Mexico sending Nation Guard to the border is quote 0:07:02.320 --> 0:07:06.280 a very good sign unquote. Is there an equivalent side 0:07:06.520 --> 0:07:09.160 here for Canada? What is it that Justin Trudeau can 0:07:09.240 --> 0:07:12.120 promise Donald Trump on the phone at three o'clock you're 0:07:12.120 --> 0:07:13.960 going to line up the Mounties and that's going to 0:07:14.000 --> 0:07:15.760 be it along the northern border here or is it 0:07:15.840 --> 0:07:16.520 something more than that? 0:07:18.240 --> 0:07:21.600 Well, It's interesting because the AEPA order was focused on fentanyl, 0:07:21.640 --> 0:07:28.080 and the cross border fentanyl from Canada is relatively small, 0:07:28.480 --> 0:07:33.320 very very small, negligible relative to Mexico. And so really 0:07:33.360 --> 0:07:36.000 the question is what's the goal of this and what 0:07:36.040 --> 0:07:38.960 do you really want from Canada Canada. Are there unstated 0:07:39.000 --> 0:07:41.960 goals that are not in the AEPA order or is 0:07:42.000 --> 0:07:46.280 there something more? And so I think that explains the 0:07:46.400 --> 0:07:50.760 difference in the way that relatively relatively Canada and Mexico 0:07:50.800 --> 0:07:54.240 have responded. So Mexico has, you know, really made a 0:07:54.320 --> 0:07:57.560 number of measures and you just read that out to 0:07:57.760 --> 0:08:02.280 demonstrate focus on fentinel. Well, Canada's response is a little 0:08:02.280 --> 0:08:06.160 bit different. They've said, well, we'll retaliate. I think the 0:08:06.280 --> 0:08:10.280 Ontario premiere has said that he's banning US companies from 0:08:10.920 --> 0:08:14.240 government contracts in Ontario. So too much harder stance. And 0:08:14.280 --> 0:08:18.600 it's really because these measures affect those countries differently, and 0:08:18.680 --> 0:08:24.120 their potential kind of alternatives are also different. Remember, our 0:08:24.160 --> 0:08:28.400 relationship with Canada is also important with respect to the 0:08:28.440 --> 0:08:32.520 competition with China, both in terms of critical minerals that 0:08:32.559 --> 0:08:38.440 we need for advanced technologies. Canada's role on implementation of 0:08:38.760 --> 0:08:42.360 export controls, and also the fact that Canada is going 0:08:42.360 --> 0:08:44.480 to take over the G seven presidency and we need 0:08:44.559 --> 0:08:47.720 partnership with them to again and win the bigger the 0:08:47.760 --> 0:08:50.720 bigger war, if you will, the tech war. 0:08:52.120 --> 0:08:54.080 That's a good one, Avina. I haven't heard anybody mention 0:08:54.160 --> 0:08:57.440 that the G seven. We like data here at Bloomberg. 0:08:57.480 --> 0:08:58.520 Let's put some numbers on this. 0:08:58.600 --> 0:09:04.000 To your point, Canada negligible as a source of fentanyl trafficking. 0:09:04.760 --> 0:09:08.560 Forty three pounds came across the northern border last year 0:09:09.520 --> 0:09:15.040 versus twenty one thousand pounds across the southern border. Gives 0:09:15.120 --> 0:09:17.520 a little bit of perspective to what we're talking about, Navine. 0:09:17.520 --> 0:09:20.600 What is this poor ten for the EU? Donald Trump 0:09:20.600 --> 0:09:21.600 says Europe is next. 0:09:23.640 --> 0:09:26.480 Well, you know there are two things he says there next. Again, 0:09:26.520 --> 0:09:29.160 the question is going to become, what are the goals 0:09:29.200 --> 0:09:33.000 of whatever tariffs he puts on the EU? Are we 0:09:33.080 --> 0:09:39.480 dealing with trying to address bilateral trade deficits? So, for example, 0:09:39.480 --> 0:09:42.600 in the case of Mexico and Canada, you may put 0:09:42.600 --> 0:09:47.400 these tariffs on both countries, but you will likely experience 0:09:47.400 --> 0:09:50.520 an increase in imports from other countries like Germany, like 0:09:50.600 --> 0:09:54.680 those in Europe. So the overall aggregate b trade deficit 0:09:54.760 --> 0:09:57.840 will not reduce, but you might shift which countries you 0:09:57.920 --> 0:10:01.559 have a deficit in relative to others. And so the 0:10:01.679 --> 0:10:04.120 question is what's the goal with respect to Europe. Is 0:10:04.120 --> 0:10:07.120 it to address the bilateral trade deficit? Well, let's see 0:10:07.120 --> 0:10:10.920 what the president does there. Is it to achieve some 0:10:11.080 --> 0:10:15.520 other non economic ends such as the fentoonyl case here 0:10:15.559 --> 0:10:18.040 in North America? Are there other goals he's trying to 0:10:18.040 --> 0:10:21.040 achieve with Europe? Potentially there are, And then you'd have 0:10:21.120 --> 0:10:26.120 to ask the question are these commensurate? You have economic measures, 0:10:26.640 --> 0:10:29.320 the costs of which we don't fully understand because they 0:10:29.360 --> 0:10:31.960 have to play out, and then you're trying to achieve 0:10:32.080 --> 0:10:39.880 relatively short term actions on non economic policy issues. And 0:10:39.960 --> 0:10:43.439 so the question is is it a good motivator for that? 0:10:42.960 --> 0:10:45.880 That is the jury is still out on that. 0:10:47.840 --> 0:10:50.160 Smart talk. Lavin, thank you for joining. It's great to 0:10:50.160 --> 0:10:50.400 have you. 0:10:50.440 --> 0:10:54.080 The vin Gary Shankar csis the Center for Strategic and 0:10:54.120 --> 0:10:57.959 International Studies formally with the Department of Commerce. A voice 0:10:57.960 --> 0:11:00.000 of experience, as we always try to bring you here 0:11:00.320 --> 0:11:02.280 on the fastest show in politics. 0:11:01.840 --> 0:11:03.960 We'll keep working our way through this. It has been 0:11:04.280 --> 0:11:05.800 quite a doozy of a couple of days. 0:11:05.840 --> 0:11:08.600 Our Political panel is up next today Genie Shanzano, our 0:11:08.640 --> 0:11:12.400 Democratic analyst with Republican strategist Mark Short On Bloomberg. 0:11:14.640 --> 0:11:18.120 You're listening to the Bloomberg Balance of Power podcast. Catch 0:11:18.200 --> 0:11:21.280 us live weekdays at noon and five pm Eastern on 0:11:21.400 --> 0:11:24.640 Apple Cocklay and Android Auto with the Bloomberg Business App. 0:11:24.679 --> 0:11:27.679 You can also listen live on Amazon Alexa from our 0:11:27.720 --> 0:11:31.800 flagship New York station, Just Say Alexa, Play Bloomberg eleven 0:11:31.920 --> 0:11:34.120 thirty O China. 0:11:34.120 --> 0:11:36.880 We're going to put in a different bucket today, but 0:11:37.000 --> 0:11:40.760 with regard to Canada and Mexico, our two immediate neighbors here, 0:11:40.800 --> 0:11:44.240 this is something that has changed a lot already. We 0:11:44.280 --> 0:11:47.240 are sitting here on the eve of the tariffs being implemented. 0:11:47.640 --> 0:11:50.199 The market thinks it knows something. The question is what 0:11:50.240 --> 0:11:54.160 can Justin Trudeau offer that might delay the tariffs? 0:11:54.160 --> 0:11:54.360 Here? 0:11:54.480 --> 0:11:58.440 Is it ten thousand mounties along the border as Mexico 0:11:58.559 --> 0:12:00.840 is giving us in the form of their own troops. 0:12:01.120 --> 0:12:03.400 Our political panel is with us today to talk about 0:12:03.400 --> 0:12:06.160 this and a lot more. Jeanie Shanzeno or Bloomberg Politics 0:12:06.160 --> 0:12:08.880 contributor and Democratic analyst with us in New York. Senior 0:12:08.920 --> 0:12:10.839 Democracy Fellow with the Center for the Study of the 0:12:10.880 --> 0:12:14.520 Presidency in Congress with me here in Washington. Republican strategist 0:12:14.679 --> 0:12:18.000 Mark Short, former chief of staff to former Vice President 0:12:18.120 --> 0:12:19.880 Mike Pence. Great to see you both here and Mark, 0:12:19.880 --> 0:12:21.520 thanks for being with us in studio. It's great to 0:12:21.559 --> 0:12:24.800 have you as part of our conversation. As always, do 0:12:24.920 --> 0:12:28.160 we step back big picture here and say, well, I 0:12:28.160 --> 0:12:31.480 guess tariffs do work, you just don't have to implement them. 0:12:32.960 --> 0:12:36.040 I think that President Trump, even his first administration, was 0:12:36.160 --> 0:12:39.000 very effective in the negotiation with tariffs and to use 0:12:39.040 --> 0:12:42.920 them to bring people to the negotiating table. However, I 0:12:42.960 --> 0:12:45.400 do think there's a big difference between the first administration 0:12:45.440 --> 0:12:48.920 and the second administration. In the first administration, the president 0:12:49.080 --> 0:12:52.760 had a lot of economic advisors but also national security 0:12:52.760 --> 0:12:55.520 advisors who believed in the benefits of trade, not just 0:12:55.600 --> 0:12:58.720 for the economy but for national security. The team that 0:12:58.760 --> 0:13:00.760 he has around today is a very different team that 0:13:00.840 --> 0:13:04.200 does not has a much more protectionist perspective. And so 0:13:04.840 --> 0:13:07.280 even though there may be some thirty day relief here 0:13:07.320 --> 0:13:11.240 in the Mexico terraces, I think that the advisors he 0:13:11.320 --> 0:13:13.400 has around him right now, believe very strongly in a 0:13:13.400 --> 0:13:16.880 protectionist policy because they really believe that the manufacturing base 0:13:16.920 --> 0:13:19.520 of America has been hurt by trade. And so I 0:13:19.559 --> 0:13:22.520 think that this may be a temporary reprieve. I don't 0:13:22.520 --> 0:13:24.320 think it'll be a permanent reprieve. I think this is 0:13:24.360 --> 0:13:27.280 this administration to be moving forward with a whole slew 0:13:27.320 --> 0:13:28.960 of tariffs in the coming months. 0:13:28.640 --> 0:13:31.160 And maybe come back with something more targeted toward Mexico, 0:13:31.200 --> 0:13:33.520 for instance, auto sector or otherwise. 0:13:33.440 --> 0:13:35.640 Perhaps, But I mean even at the same time that 0:13:35.679 --> 0:13:39.719 these threats are being settled, he's threatening new terriffs for 0:13:39.760 --> 0:13:42.760 the EU. That's right, And so I think that you know, 0:13:42.840 --> 0:13:46.520 typically with the US Trade Representives Office, it requires about 0:13:46.559 --> 0:13:49.800 a ninety day investigation to prove unfair trade practices, and 0:13:49.880 --> 0:13:52.640 you've heard the administration hint that April was when a 0:13:52.640 --> 0:13:54.920 lot of those investigations will come. Do what he had 0:13:54.960 --> 0:14:00.040 threatened with Canada and Mexico was unique. Under IEPA, the 0:14:00.160 --> 0:14:06.079 Economic Empowers Act. Did no administration ever use that for tariffs, 0:14:06.080 --> 0:14:09.240 and so there's I think there was other challenges potentially 0:14:09.280 --> 0:14:11.160 in the courts on that. And so if there's a 0:14:11.200 --> 0:14:13.160 backing off of some of the Mexico. I still think 0:14:13.200 --> 0:14:15.640 it's becoming when these investigations are complete. 0:14:15.679 --> 0:14:15.880 Wow. 0:14:15.960 --> 0:14:18.360 So, Genie, are we looking at a master at work 0:14:18.400 --> 0:14:20.520 here or an economic arsonist? 0:14:22.400 --> 0:14:25.400 Well, I think it could be somewhere in between. You know, 0:14:25.480 --> 0:14:28.320 we did here for a while that even you know, 0:14:28.440 --> 0:14:31.680 especially people in the market, were not that concerned because 0:14:31.720 --> 0:14:34.160 they said, this is going to be transactional in nature, 0:14:34.440 --> 0:14:37.680 We're going to get these negotiations as we've seen with Mexico, 0:14:38.200 --> 0:14:41.400 and that this would in the long term not have 0:14:41.480 --> 0:14:45.320 a real economic impact. But as a political scientist, let 0:14:45.360 --> 0:14:48.080 me say that there is a price to pay for this. 0:14:48.800 --> 0:14:52.000 We teach our children not to bully in the playground 0:14:52.080 --> 0:14:55.680 for a reason, and we don't bully in the international 0:14:55.720 --> 0:14:59.560 realm either for a reason, because there are long term 0:14:59.680 --> 0:15:04.280 impact on our national security and our alliances. If you 0:15:04.400 --> 0:15:07.760 are another country and you are looking at this bullying, 0:15:08.160 --> 0:15:12.200 are you inclined to trust your alliance with the United 0:15:12.240 --> 0:15:15.080 States or are you more inclined to go say the 0:15:15.120 --> 0:15:18.120 way of China and Jijinping. There is a school of 0:15:18.200 --> 0:15:22.000 thought which says all the inroads that jijon Ping has 0:15:22.160 --> 0:15:25.800 made in the global South, he is the beneficiary of 0:15:25.840 --> 0:15:29.240 this kind of bullying. Donald Trump does this because he 0:15:29.440 --> 0:15:31.440 is long held that we are on the losing end 0:15:31.440 --> 0:15:34.360 of a trade deficit. But the reality is he is 0:15:34.480 --> 0:15:38.480 president of the United States and our alliances matter. And 0:15:38.520 --> 0:15:40.080 this is true not only if you look at this 0:15:40.120 --> 0:15:42.480 story about tariffs, but also if you look at the 0:15:42.560 --> 0:15:46.880 USAID story. So long term the impact on US, I 0:15:46.920 --> 0:15:51.000 am extremely concerned about short term, we may all survive 0:15:51.080 --> 0:15:52.000 this economically. 0:15:53.240 --> 0:15:56.280 Mark you were there for the renegotiating of NAFTA. I 0:15:56.480 --> 0:16:01.160 guess we can call it that. Creating the USM is 0:16:01.800 --> 0:16:05.080 genie correct about bullying and does a weakened Mexico and 0:16:05.200 --> 0:16:09.440 China embolden or Canada rather embolden China. 0:16:09.480 --> 0:16:12.440 Well, I will say that even in the USMCA trade agreement, 0:16:12.480 --> 0:16:15.920 there was a clause that allowed under national security emergencies 0:16:15.960 --> 0:16:19.520 and ability to obviate the treaty and to move forward 0:16:19.520 --> 0:16:21.800 to tariffs. And I think that that's why you've seen 0:16:21.840 --> 0:16:24.880 the president youth sventanyl and the border crisis, which I 0:16:24.880 --> 0:16:27.000 think certainly applies to Mexico. It's a little bit harder 0:16:27.000 --> 0:16:30.600 to see the emergency with the border in Canada. But 0:16:30.760 --> 0:16:34.280 I think that I'm less worried about the bullying factor. 0:16:34.320 --> 0:16:36.400 I think that for a lot of Americans, they do 0:16:36.480 --> 0:16:40.800 feel that there's been a weakness of American foreign policy 0:16:40.840 --> 0:16:43.840 for years, and I think they welcome a stronger personality. 0:16:43.840 --> 0:16:45.720 But I think Genie makes a really good point about 0:16:45.760 --> 0:16:48.720 China being the beneficiary, because I remember in the first 0:16:48.720 --> 0:16:52.520 administration that, for instance, it took a lot of negotiation, 0:16:52.760 --> 0:16:56.240 if you recall the Huawei controversy first to get Canada 0:16:56.400 --> 0:17:00.400 onto our side on Huawei against China. Are they going 0:17:00.480 --> 0:17:03.280 to be as excited to partner with us the next 0:17:03.280 --> 0:17:06.159 time around when we have a concern about China. And 0:17:06.720 --> 0:17:08.200 so I think she makes a really good point. And 0:17:08.280 --> 0:17:11.119 in some cases, when you're tearing down these alliances, you 0:17:11.480 --> 0:17:15.080 force some of our former allies into relationships with some 0:17:15.119 --> 0:17:18.119 of our adversaries. And I think again that's where our 0:17:18.200 --> 0:17:21.359 national security advisors in the first administration believed in the 0:17:21.359 --> 0:17:23.480 benefit of that trade. That currently those are not the 0:17:23.480 --> 0:17:24.879 same advisors that's going around. 0:17:25.040 --> 0:17:27.119 We're spending time with Mark Short and Genie Shanzino are 0:17:27.160 --> 0:17:29.159 a great panel on the Monday edition here a Balance 0:17:29.160 --> 0:17:32.879 of Power. It was a very busy weekend for the 0:17:32.920 --> 0:17:35.560 Trump administration. While you were going about your business, it 0:17:35.600 --> 0:17:37.919 wasn't only terriffs they were talking about here. What we 0:17:38.000 --> 0:17:42.919 saw take place with us AID. Us AID was quite remarkable. 0:17:42.960 --> 0:17:47.199 Here Elon Musk declaring on X us AID is a 0:17:47.320 --> 0:17:48.520 criminal organization. 0:17:49.600 --> 0:17:50.840 Time for it to die. 0:17:51.840 --> 0:17:53.520 We know that a lot of things happen there over 0:17:53.560 --> 0:17:55.920 the course of the weekend. Workers were told to stay home. 0:17:55.960 --> 0:17:58.200 And since we've arrived here this morning, we're told the 0:17:58.200 --> 0:17:59.960 Secretary of State Marco Rubio. 0:17:59.680 --> 0:18:02.040 Has taken can control of us AID. 0:18:02.359 --> 0:18:04.520 Genie, your thoughts on this, and I'll ask you about 0:18:04.560 --> 0:18:06.800 this payment system at the Treasury because it strikes me 0:18:06.920 --> 0:18:09.480 that in the end, these could be more significant stories 0:18:09.840 --> 0:18:11.440 than what we're hearing about tariffs today. 0:18:12.560 --> 0:18:14.840 Yeah, Joe, you forgot to mention the other big news 0:18:14.840 --> 0:18:17.199 of the weekend, which was Pucksatani Phil. So we're in 0:18:17.240 --> 0:18:19.360 for more winters beside. 0:18:19.200 --> 0:18:20.520 I'm depressed already. I know. 0:18:21.119 --> 0:18:24.719 I'm sorry. I'm USAID. And of course the Treasury story. 0:18:25.000 --> 0:18:27.639 You know, I mentioned this prior because it seems to 0:18:27.680 --> 0:18:30.639 me it's pert and person of Donald Trump's approach to 0:18:30.680 --> 0:18:34.320 the world, and certainly you have people in the US 0:18:34.320 --> 0:18:37.920 and around the world who support it. I do get concerned. 0:18:38.000 --> 0:18:42.720 A good deal that we are seeming to lose understanding 0:18:42.800 --> 0:18:46.480 of something that China, which Mark just mentioned before, knows 0:18:46.520 --> 0:18:52.520 intuitively soft power matters. Now usaid, certainly there is waste 0:18:52.600 --> 0:18:57.040 in all government programs. Certainly no question can be cleaned out. 0:18:57.480 --> 0:19:01.439 But I am worried when we to think that something 0:19:01.520 --> 0:19:04.479 you know, talking about people within there as you know, 0:19:04.600 --> 0:19:08.400 somehow criminals without evidence, when we talk about it as 0:19:08.480 --> 0:19:12.520 needing to be dead or destroyed. Certainly again cleaned up. 0:19:12.840 --> 0:19:16.760 But soft power matters. And if the United States doesn't 0:19:16.840 --> 0:19:21.520 exercise soft power, that power shift will go elsewhere like 0:19:21.680 --> 0:19:25.600 China and Russia. And nobody does this better than Jijinping. 0:19:26.040 --> 0:19:28.960 Look at the Silk Road, look at again the inroads 0:19:29.000 --> 0:19:33.159 into the global South. We are losing our ability to 0:19:33.240 --> 0:19:38.040 be seen around the world as anybody but demanding harvesting people, 0:19:38.280 --> 0:19:42.960 mining people's goods. We also have to help the poorest 0:19:43.240 --> 0:19:45.719 people in the world if we want to have an 0:19:45.760 --> 0:19:49.480 ability to have impact. You know, somebody just reminded me 0:19:49.600 --> 0:19:52.000 that there was a point just before World War two 0:19:52.400 --> 0:19:57.800 when somebody told Truman that hunger means communism. And we 0:19:57.920 --> 0:20:01.919 fight that by showing people that democracy can deliver for 0:20:02.000 --> 0:20:04.480 them and us and soft power matters in that. 0:20:05.960 --> 0:20:06.560 Mark, I don't know. 0:20:06.560 --> 0:20:08.840 Your thoughts on this and the idea of kind of 0:20:08.840 --> 0:20:10.919 giving the keys to Elon Musk, but I think of 0:20:11.000 --> 0:20:15.399 you as an older style Republican, an institutionalist, maybe a 0:20:15.400 --> 0:20:18.520 more traditional Republican. Maybe you've gotten your head around Terris. 0:20:18.560 --> 0:20:19.720 Are you getting your head around this? 0:20:20.640 --> 0:20:23.920 I think that on USC I d that that. 0:20:24.119 --> 0:20:26.440 I think for a lot of Americans, they do wanted 0:20:26.520 --> 0:20:28.760 more of America First policy. Do feel like there's been 0:20:28.800 --> 0:20:31.400 a lot of taxpayer dollars abuse, But it's important that 0:20:31.400 --> 0:20:33.800 I think the President Trump has a has an effective 0:20:33.840 --> 0:20:36.399 way of throwing an idea out, seeing what the market 0:20:36.400 --> 0:20:39.199 reaction is and adjusting. And so over the weekend it 0:20:39.359 --> 0:20:41.840 was is you just read from Elon Musk it's criminal, 0:20:41.920 --> 0:20:44.560 it'll be abolished, and now it's like, well, actually it's 0:20:44.600 --> 0:20:47.200 just going to be shrunk and put under Mark Rubia's 0:20:47.600 --> 0:20:49.960 So there's a there's already an adjustment within a very 0:20:50.040 --> 0:20:50.840 quick amount of time. 0:20:50.880 --> 0:20:52.200 It's what actions be happening. 0:20:52.240 --> 0:20:54.160 So we back to that, take them seriously, take them 0:20:54.160 --> 0:20:55.199 literally debates? 0:20:55.240 --> 0:20:56.520 Well, No, I think I think it's important too. 0:20:56.560 --> 0:20:59.600 He often throws ideas out and since reaction and I 0:20:59.640 --> 0:21:02.119 and I think that seeing how the market reacted of 0:21:02.160 --> 0:21:05.560 the weekend to the to the terraffs, I think helped 0:21:05.680 --> 0:21:10.520 modulate on Mexico by this morning. So so yes, Mexico 0:21:10.600 --> 0:21:12.240 came back to the table saying that put troops to 0:21:12.240 --> 0:21:14.040 the border. But I think the President was also looking 0:21:14.040 --> 0:21:15.879 for a deal because he didn't like that market reaction. 0:21:16.080 --> 0:21:18.320 So he is always going to be sensitive to what 0:21:18.359 --> 0:21:20.320 the either the financial markets or. 0:21:20.280 --> 0:21:21.880 The popularity markets did. 0:21:21.960 --> 0:21:23.880 But to another point the Genie was making, I think 0:21:23.880 --> 0:21:26.679 another story was lost here is that you know, I 0:21:26.720 --> 0:21:30.680 thought Mark or Ruby had a significant achievement in Panama 0:21:30.760 --> 0:21:33.280 with Belton Road initiative. But I felt in many ways 0:21:33.280 --> 0:21:35.439 the President Trump undercut that by coming out, you know, 0:21:35.520 --> 0:21:37.560 yesterday and saying, well, that's not really objective and take 0:21:37.600 --> 0:21:41.480 back the canal. I mean, getting Panama the distance itself 0:21:41.520 --> 0:21:44.720 from the Chinese investments was a huge win from markoint Yes, 0:21:45.080 --> 0:21:47.120 so I felt like that was undercutting what I thought 0:21:47.200 --> 0:21:49.440 was a very significant foreign policy achievement by. 0:21:49.520 --> 0:21:51.720