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Speaker 1: Former Commerce Secretary of the United States, Wilbur Ross joining

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Speaker 1: us right now, who serve in the Trump administration. Prior

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Speaker 1: to that, he ran W L. Ross and continues as Chairman,

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Speaker 1: president and CEO of Ross Acquisition Corps. Mister Secretary, Great

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Speaker 1: to have you here on the program. Kind of fitting

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Speaker 1: that the G seven is talking about a lot of

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Speaker 1: those tariffs, tariffs that originated not only from the Trump administration,

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Speaker 1: but specifically from your department as well. We now have

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Speaker 1: an ability to look back over the last seven eight years.

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Speaker 1: Have those tariffs been effective?

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Speaker 2: Oh? I think they definitely have been in several regards.

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Speaker 2: One let everybody know that the President was serious about

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Speaker 2: fixing the balance of payments problem, and two that he

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Speaker 2: was willing to break with the tradition that prior presidents

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Speaker 2: had set up. So I think these president tariffs that

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Speaker 2: President Biden is putting in well really just an extension

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Speaker 2: of the thinking that we had before. The auto vehicle

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Speaker 2: tariff on electric vehicles, for example, we started and in

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Speaker 2: those days there weren't even any electric vehicles sold to

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Speaker 2: the US from China, and so it was easy to

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Speaker 2: get it into the agreement because it didn't hurt there.

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Speaker 2: Then exports, but it set the pattern, and I think

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Speaker 2: this is what's now being followed through.

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Speaker 1: There's been a big question as to what, if anything,

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Speaker 1: gets us to the point in our relationship with China

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Speaker 1: where maybe those tarrets could either be reduced or even eliminated.

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Speaker 1: How do you feel about the progress of our relationship

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Speaker 1: with the Chinese and whether we are going to get

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Speaker 1: to a point where it is more amicable.

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Speaker 2: Well, I don't think there's ever been proof that running

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Speaker 2: a big trade deficit with another country makes them a

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Speaker 2: true ally. I think that's one of the many fictions

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Speaker 2: that the so called free trade people had prompted over

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Speaker 2: the years. I think that it's essential that Biden took

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Speaker 2: the steps that he has taken. I wonder a little

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Speaker 2: bit why it took three and a half years to

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Speaker 2: get there, because China has been ramping up the ebs

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Speaker 2: for quite a while. But at least he's now doing it,

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Speaker 2: and I think that's good and it's consistent with trying

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Speaker 2: to create a better climate situation. But to do it

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Speaker 2: without hurting our balance of payments Secretary Ross.

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Speaker 3: President Trump floated lawmakers today higher tariffs in exchange for

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Speaker 3: lower taxes. Does that make logical sense, or does that

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Speaker 3: create a different economic problem.

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Speaker 2: Well, remember, tariffs go into the federal budget as receipts

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Speaker 2: every bit as much as taxes do, so in an

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Speaker 2: arithmetic sense, it's clearly correct that one could very well

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Speaker 2: offset the other. Prison Trump has always liked the idea

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Speaker 2: of tariffs as a revenue source, and that's why he

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Speaker 2: went with the idea of tariffs on products from day one,

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Speaker 2: rather than having quotas and if the country exceeds those quotas,

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Speaker 2: then putting in the tariffs. So he reviews it and

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Speaker 2: has viewed it partly as a revenue measure, but more

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Speaker 2: than that, it's to make a fair arrangement between the countries.

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Speaker 3: As a secretary, there seems to be a lot of questions, now,

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Speaker 3: is a Trump two point zero economic plan? Is that inflationary?

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Speaker 3: When we talk about tariffs, And there's a lot of

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Speaker 3: debate as to whether or not tariffs are inflationary or not.

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Speaker 3: But there's reduced immigration, which you could argue shrinks the workforce,

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Speaker 3: renewed tax cuts with more fiscal stimulus, and the questions

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Speaker 3: about fed independence.

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Speaker 2: What say you, Well, that's a whole lot of questions

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Speaker 2: fall in one question. So I'll try to answer them

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Speaker 2: one by one. Go back to the Trump years. There

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Speaker 2: was no big runaway inflation. So the idea that the

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Speaker 2: tariffs that we put in were somehow going to hurt

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Speaker 2: the working people charge them too much for goods proved

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Speaker 2: to be incorrect, despite the fact that we had unemployment

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Speaker 2: down below the four percent level. So there is no

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Speaker 2: evidence that the Trump tariffs really were inflationary. And second,

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Speaker 2: the reason for that is to some extent the other

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Speaker 2: countries absorb it themselves, that either the exporters or in

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Speaker 2: some cases the governments there providing them with subsidies. So

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Speaker 2: it's just not the same thing as the naysayers had anticipated.

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Speaker 2: That's not what the record shows.

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Speaker 1: That's the second.

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Speaker 2: Then I think your other question was about what does

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Speaker 2: that do to relationships. It seems to me that we've

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Speaker 2: done at least as much damage and relationship by constantly

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Speaker 2: provoking China, with Taiwan and with some of the other

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Speaker 2: actions that the government has taken. This administration's policy toward

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Speaker 2: China and frankly toward a lot of other countries has

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Speaker 2: been a little bit schizophrenic in that, on the one hand,

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Speaker 2: he sends Janet Yaleen he sends Anthony Blincoln, sends all

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Speaker 2: kinds of people over there to negotiate, and then he

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Speaker 2: keeps attacking them verbally. I think a better solution would

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Speaker 2: be Teddy Roosevelt's solution, speak softly and carry a big stick,

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Speaker 2: rather than speak loudly and carry a little stick.

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Speaker 1: Okay, are so I'm curious, mister a secretary, are you

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Speaker 1: still advising Donald Trump and his campaign and his potential

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Speaker 1: candidacy here for president?

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Speaker 2: Well, I'd certainly have been supporting him, both in terms

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Speaker 2: of my endorsement quite a few months ago and in

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Speaker 2: terms of monetary contribution. So yes, I'm very much in

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Speaker 2: favor of his reelection.

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Speaker 1: There's a meeting that was taking place earlier today in Washington.

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Speaker 1: The Business Roundtable hosted it. I know these meetings are

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Speaker 1: pretty standard during campaigns, they meet with both of other

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Speaker 1: major party candidates. Today was Trump's turn here. What is

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Speaker 1: the message that you would want the business community to

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Speaker 1: hear out of this Trump campaign as they decide what

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Speaker 1: the outcome might actually be?

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Speaker 2: Okay? Well, first of all, quite a few senior businesspeople

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Speaker 2: are in fact supporting Trump. A number of them formerly

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Speaker 2: had been much more in the free trade camp. Than

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Speaker 2: they are now because they've seen the actual results of

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Speaker 2: the Trump policies and they've seen the Chinese government and

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Speaker 2: others taking more control role of the private sector, and

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Speaker 2: that is worrisome to them. You probably saw that some

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Speaker 2: of them are moving big facilities to India, and others

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Speaker 2: are moving them to Vietnam, and quite a few are

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Speaker 2: moving them to Mexico. Yeah, so they're still looking for

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Speaker 2: low cost production, but they're being weaned a little bit

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Speaker 2: of the idea that you can have a really complicated

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Speaker 2: and really elongated supply chain.

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Speaker 3: Secretary one last question. Bill Gross, legendary bond King wrote

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Speaker 3: in an op ed in the Ft and he said

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Speaker 3: that Trump is the more bearish of the candidates for

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Speaker 3: treasuries is what he meant, simply because his programs advocate

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Speaker 3: continued tax cuts and more expensive things. Both candidates, the

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Speaker 3: idea are going to be negative for the fiscal deficit.

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Speaker 3: Budget deficit we can need to rise, but Trump will

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Speaker 3: be worse.

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Speaker 1: What do you say to that.

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Speaker 2: Well, I don't that's mister Gross's opinion. But the truth

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Speaker 2: is that deficits are running very, very high under President Biden.

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Speaker 2: The difference is that these measures, these expensures to the

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Speaker 2: public are putting money into the pockets for the most

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Speaker 2: part of people not working, as opposed to creating jobs

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Speaker 2: for them to fill. And I think that's part of

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Speaker 2: the reason why inflation has been as sticky as it is.

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Speaker 2: And as you know, the Federal Reserve just decided not

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Speaker 2: to make a cut because of worries about continued inflation.

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Speaker 2: I think it's inherently more inflationary to put out money

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Speaker 2: from the government that does not go to productive use

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Speaker 2: than it is to put out money that goes to

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Speaker 2: productive use. So I would argue that the inflationary precious

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Speaker 2: are much more likely to be severe under President Biden

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Speaker 2: than they would be under President Trump.

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Speaker 1: All right, mister Secretary, have to leave it there. I

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Speaker 1: appreciate you taking time for us while we're ross there

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Speaker 1: at the former US Secretary of Commerce