Speaker 1: Former Commerce Secretary of the United States, Wilbur Ross joining
Speaker 1: us right now, who serve in the Trump administration. Prior
Speaker 1: to that, he ran W L. Ross and continues as Chairman,
Speaker 1: president and CEO of Ross Acquisition Corps. Mister Secretary, Great
Speaker 1: to have you here on the program. Kind of fitting
Speaker 1: that the G seven is talking about a lot of
Speaker 1: those tariffs, tariffs that originated not only from the Trump administration,
Speaker 1: but specifically from your department as well. We now have
Speaker 1: an ability to look back over the last seven eight years.
Speaker 1: Have those tariffs been effective?
Speaker 2: Oh? I think they definitely have been in several regards.
Speaker 2: One let everybody know that the President was serious about
Speaker 2: fixing the balance of payments problem, and two that he
Speaker 2: was willing to break with the tradition that prior presidents
Speaker 2: had set up. So I think these president tariffs that
Speaker 2: President Biden is putting in well really just an extension
Speaker 2: of the thinking that we had before. The auto vehicle
Speaker 2: tariff on electric vehicles, for example, we started and in
Speaker 2: those days there weren't even any electric vehicles sold to
Speaker 2: the US from China, and so it was easy to
Speaker 2: get it into the agreement because it didn't hurt there.
Speaker 2: Then exports, but it set the pattern, and I think
Speaker 2: this is what's now being followed through.
Speaker 1: There's been a big question as to what, if anything,
Speaker 1: gets us to the point in our relationship with China
Speaker 1: where maybe those tarrets could either be reduced or even eliminated.
Speaker 1: How do you feel about the progress of our relationship
Speaker 1: with the Chinese and whether we are going to get
Speaker 1: to a point where it is more amicable.
Speaker 2: Well, I don't think there's ever been proof that running
Speaker 2: a big trade deficit with another country makes them a
Speaker 2: true ally. I think that's one of the many fictions
Speaker 2: that the so called free trade people had prompted over
Speaker 2: the years. I think that it's essential that Biden took
Speaker 2: the steps that he has taken. I wonder a little
Speaker 2: bit why it took three and a half years to
Speaker 2: get there, because China has been ramping up the ebs
Speaker 2: for quite a while. But at least he's now doing it,
Speaker 2: and I think that's good and it's consistent with trying
Speaker 2: to create a better climate situation. But to do it
Speaker 2: without hurting our balance of payments Secretary Ross.
Speaker 3: President Trump floated lawmakers today higher tariffs in exchange for
Speaker 3: lower taxes. Does that make logical sense, or does that
Speaker 3: create a different economic problem.
Speaker 2: Well, remember, tariffs go into the federal budget as receipts
Speaker 2: every bit as much as taxes do, so in an
Speaker 2: arithmetic sense, it's clearly correct that one could very well
Speaker 2: offset the other. Prison Trump has always liked the idea
Speaker 2: of tariffs as a revenue source, and that's why he
Speaker 2: went with the idea of tariffs on products from day one,
Speaker 2: rather than having quotas and if the country exceeds those quotas,
Speaker 2: then putting in the tariffs. So he reviews it and
Speaker 2: has viewed it partly as a revenue measure, but more
Speaker 2: than that, it's to make a fair arrangement between the countries.
Speaker 3: As a secretary, there seems to be a lot of questions, now,
Speaker 3: is a Trump two point zero economic plan? Is that inflationary?
Speaker 3: When we talk about tariffs, And there's a lot of
Speaker 3: debate as to whether or not tariffs are inflationary or not.
Speaker 3: But there's reduced immigration, which you could argue shrinks the workforce,
Speaker 3: renewed tax cuts with more fiscal stimulus, and the questions
Speaker 3: about fed independence.
Speaker 2: What say you, Well, that's a whole lot of questions
Speaker 2: fall in one question. So I'll try to answer them
Speaker 2: one by one. Go back to the Trump years. There
Speaker 2: was no big runaway inflation. So the idea that the
Speaker 2: tariffs that we put in were somehow going to hurt
Speaker 2: the working people charge them too much for goods proved
Speaker 2: to be incorrect, despite the fact that we had unemployment
Speaker 2: down below the four percent level. So there is no
Speaker 2: evidence that the Trump tariffs really were inflationary. And second,
Speaker 2: the reason for that is to some extent the other
Speaker 2: countries absorb it themselves, that either the exporters or in
Speaker 2: some cases the governments there providing them with subsidies. So
Speaker 2: it's just not the same thing as the naysayers had anticipated.
Speaker 2: That's not what the record shows.
Speaker 1: That's the second.
Speaker 2: Then I think your other question was about what does
Speaker 2: that do to relationships. It seems to me that we've
Speaker 2: done at least as much damage and relationship by constantly
Speaker 2: provoking China, with Taiwan and with some of the other
Speaker 2: actions that the government has taken. This administration's policy toward
Speaker 2: China and frankly toward a lot of other countries has
Speaker 2: been a little bit schizophrenic in that, on the one hand,
Speaker 2: he sends Janet Yaleen he sends Anthony Blincoln, sends all
Speaker 2: kinds of people over there to negotiate, and then he
Speaker 2: keeps attacking them verbally. I think a better solution would
Speaker 2: be Teddy Roosevelt's solution, speak softly and carry a big stick,
Speaker 2: rather than speak loudly and carry a little stick.
Speaker 1: Okay, are so I'm curious, mister a secretary, are you
Speaker 1: still advising Donald Trump and his campaign and his potential
Speaker 1: candidacy here for president?
Speaker 2: Well, I'd certainly have been supporting him, both in terms
Speaker 2: of my endorsement quite a few months ago and in
Speaker 2: terms of monetary contribution. So yes, I'm very much in
Speaker 2: favor of his reelection.
Speaker 1: There's a meeting that was taking place earlier today in Washington.
Speaker 1: The Business Roundtable hosted it. I know these meetings are
Speaker 1: pretty standard during campaigns, they meet with both of other
Speaker 1: major party candidates. Today was Trump's turn here. What is
Speaker 1: the message that you would want the business community to
Speaker 1: hear out of this Trump campaign as they decide what
Speaker 1: the outcome might actually be?
Speaker 2: Okay? Well, first of all, quite a few senior businesspeople
Speaker 2: are in fact supporting Trump. A number of them formerly
Speaker 2: had been much more in the free trade camp. Than
Speaker 2: they are now because they've seen the actual results of
Speaker 2: the Trump policies and they've seen the Chinese government and
Speaker 2: others taking more control role of the private sector, and
Speaker 2: that is worrisome to them. You probably saw that some
Speaker 2: of them are moving big facilities to India, and others
Speaker 2: are moving them to Vietnam, and quite a few are
Speaker 2: moving them to Mexico. Yeah, so they're still looking for
Speaker 2: low cost production, but they're being weaned a little bit
Speaker 2: of the idea that you can have a really complicated
Speaker 2: and really elongated supply chain.
Speaker 3: Secretary one last question. Bill Gross, legendary bond King wrote
Speaker 3: in an op ed in the Ft and he said
Speaker 3: that Trump is the more bearish of the candidates for
Speaker 3: treasuries is what he meant, simply because his programs advocate
Speaker 3: continued tax cuts and more expensive things. Both candidates, the
Speaker 3: idea are going to be negative for the fiscal deficit.
Speaker 3: Budget deficit we can need to rise, but Trump will
Speaker 3: be worse.
Speaker 1: What do you say to that.
Speaker 2: Well, I don't that's mister Gross's opinion. But the truth
Speaker 2: is that deficits are running very, very high under President Biden.
Speaker 2: The difference is that these measures, these expensures to the
Speaker 2: public are putting money into the pockets for the most
Speaker 2: part of people not working, as opposed to creating jobs
Speaker 2: for them to fill. And I think that's part of
Speaker 2: the reason why inflation has been as sticky as it is.
Speaker 2: And as you know, the Federal Reserve just decided not
Speaker 2: to make a cut because of worries about continued inflation.
Speaker 2: I think it's inherently more inflationary to put out money
Speaker 2: from the government that does not go to productive use
Speaker 2: than it is to put out money that goes to
Speaker 2: productive use. So I would argue that the inflationary precious
Speaker 2: are much more likely to be severe under President Biden
Speaker 2: than they would be under President Trump.
Speaker 1: All right, mister Secretary, have to leave it there. I
Speaker 1: appreciate you taking time for us while we're ross there
Speaker 1: at the former US Secretary of Commerce