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Speaker 1: Welcome to a little special edition of the Chuck Podcast,

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Speaker 1: specifically for my YouTube subscribers. And so this is what

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Speaker 1: I want to deal with this morning, on this Friday morning,

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Speaker 1: which is a question I've already been getting over the

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Speaker 1: last forty twenty four hours, which is simply what do

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Speaker 1: all these tariffs mean for us politically? So look, here's

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Speaker 1: what we do know at the moment. This is not

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Speaker 1: going to go This does not look like it's going

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Speaker 1: to go very well. You have this kind of economic

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Speaker 1: shock to the system, this kind of you know, record

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Speaker 1: breaking balls in the stock market. It's the type of

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Speaker 1: story that everybody pays attention to. This is not the

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Speaker 1: type of stories that it's just people that are invested

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Speaker 1: in the stock market, or just wealthy people invested in

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Speaker 1: the stock market. This is a global story. This is

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Speaker 1: arguably the lead story in every major news organization around

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Speaker 1: the world because these tariffs have impacted everybody. So look,

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Speaker 1: I think a few things here that we both overestimated

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Speaker 1: with Trump and underestimated with Trump. And it has to

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Speaker 1: do with the idea that he's a transactional guy. And

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Speaker 1: the assumption was and frankly, this is what many in

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Speaker 1: the business community because Donald Trump campaigned on this, he

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Speaker 1: said he was going to do this. He is believed

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Speaker 1: in tariffs. It goes back to nineteen eighty seven. Back

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Speaker 1: in nineteen eighty seven, when Roger Stone was trying to

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Speaker 1: help create Donald Trump the politician, Donald Trump bought a

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Speaker 1: full page ad in the New York Times. I believe

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Speaker 1: it was in New York Times, maybe been the Post

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Speaker 1: Times in journal actually, but it was definitely a full

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Speaker 1: page ad that talked about how Japan was ripping off

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Speaker 1: America and that Japan our trade deficit, and you know,

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Speaker 1: we had idiot negotiators. If you recall nineteen eighty seven,

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Speaker 1: Ronald Reagan was president, so he in some ways, Donald Trump,

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Speaker 1: who doesn't have much of an ideology, right he was

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Speaker 1: one time pro jo and now he's pro life and

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Speaker 1: all these things. If there's one issue has been consistent on,

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Speaker 1: it's this belief that the American economy should and should

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Speaker 1: all be sort of within the borders of America. So

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Speaker 1: he does I think this is one of his actual

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Speaker 1: core beliefs, that this is the way the system should work,

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Speaker 1: that there should be more manufacturing in the country, that

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Speaker 1: if you have that that and he sees everything through

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Speaker 1: this binary way, there's winners and losers, and America is

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Speaker 1: the winner, so therefore they shouldn't have trade deficits with anybody.

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Speaker 1: People should have trade deficits with America, but it shouldn't

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Speaker 1: be the other way around. So he's somebody that doesn't

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Speaker 1: really you know. If I were, if I were a critic,

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Speaker 1: I'd say he doesn't understand the global economy. But he

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Speaker 1: certainly doesn't. I would say he doesn't really, he doesn't

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Speaker 1: buy in to this idea that the global economy has

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Speaker 1: been a success. I for the life of me, I

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Speaker 1: don't see how people don't look why most people don't

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Speaker 1: understand that if you essentially look from post World War

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Speaker 1: two to now, America has written the rules for the

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Speaker 1: global economy and it has benefited America immensely. Still the

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Speaker 1: wealthiest nation still, you know, and I say little things.

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Speaker 1: Go to any other country and ask yourself if you'd

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Speaker 1: rather live there or hear when it comes to simple

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Speaker 1: things like the mail service or the quality of toilet paper,

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Speaker 1: never mind the availability of goods and services, the availability

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Speaker 1: the fact that we do have a lot more cheap

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Speaker 1: goods available to us. Why do I grew up in Miami,

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Speaker 1: people used to fly in from other countries in order

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Speaker 1: to simply go shopping in the United States. Okay, is

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Speaker 1: this has been what the global economy has done for America.

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Speaker 1: So I know it's not cool to be for the

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Speaker 1: status quo these days. Right, everybody wants to disrupt and

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Speaker 1: change and disrupt and change. But this is one disruption

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Speaker 1: that doesn't make a lot of sense because one could

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Speaker 1: argue that since America has essentially decided that the cause

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Speaker 1: of World War two was that we didn't have enough

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Speaker 1: the economic ties with each other, and the more economic

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Speaker 1: ties you have, that less likely you're going to fight

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Speaker 1: each other. And so guess what. The last time we

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Speaker 1: went through this tariff business, it was followed by World

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Speaker 1: War Two, and there's plenty of evidence that it was

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Speaker 1: a pretty direct link. The nineteen twenty nine stock market

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Speaker 1: crash essentially was the beginning of the collapse of the

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Speaker 1: German economy was already fragile. It sort of accelerated the

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Speaker 1: collapse of the German economy, which of course accelerated the

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Speaker 1: rise of Adolf Hitler. And I don't think I need

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Speaker 1: to tell you what happened after he took over Germany.

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Speaker 1: So The point is is that this the American leadership

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Speaker 1: post World War Two concluded we can't have this type.

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Speaker 1: So what was born all of these multi national multilateral organizations,

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Speaker 1: whether it's NATO, the IMF, all of these things, and

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Speaker 1: it has been a success. We went nearly eighty years

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Speaker 1: without a war in Europe essentially, or almost eighty years.

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Speaker 1: There was the Balkan War. We can't ignore that, and

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Speaker 1: obviously we have the war now with Ukraine. But the

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Speaker 1: fact of the matter has been relative peace on Europe,

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Speaker 1: the longest arguably period of peace in Europe if for

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Speaker 1: a thousand years, if you want a nitpick on this.

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Speaker 1: So this is a radical change and it isn't going

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Speaker 1: to get better overnight. So what does this mean politically?

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Speaker 1: It's already pretty clear to me that most elected Republicans,

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Speaker 1: if they could vote without fear of Donald Trump, would

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Speaker 1: take back tariff authority tomorrow. You're already seeing some Senate

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Speaker 1: Republicans Chuck Grassley is introduced to bill with Maria Cantwell

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Speaker 1: that I think we'll have majority support, probably not yet

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Speaker 1: sixty votes, but trust me, it'll get there. But let's

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Speaker 1: talk realistically. What do I how should you watch the

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Speaker 1: next eighteen months, essentially between now and the midterms, because

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Speaker 1: if there is a change in control of either house

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Speaker 1: in Congress the midterms, I do think these teriffs will

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Speaker 1: go away almost immediately. So if let's make this, I

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Speaker 1: believe right now, if there were a Democratic House and

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Speaker 1: a Republican Senate that they would collectively grab the tariff

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Speaker 1: keys away from Donald Trump. And so the likelihood of

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Speaker 1: a Democratic House and a Republican senate's pretty high come

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Speaker 1: January of twenty twenty seven. But between now and then,

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Speaker 1: the question is would there be a majority in the

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Speaker 1: House and a majority in the Senate to do this

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Speaker 1: with the Republicans in charge of the House. In the

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Speaker 1: answer to that, that is likely. No. There is a

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Speaker 1: big distinction between House Republicans and Senate Republicans. House Republicans

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Speaker 1: are more reliant on the base of Donald Trump's party.

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Speaker 1: They're more reliant on Donald Trump, and they're frankly, you know,

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Speaker 1: their political careers would be dead if Donald Trump decided

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Speaker 1: to kill their careers. I'm not saying Senate Republicans aren't

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Speaker 1: fragile to potential threats from the Donald Trump base, but

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Speaker 1: there's certainly a bit more inoculated and many of them

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Speaker 1: don't have to run in twenty six. Not all of

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Speaker 1: them have to be on the ballot in twenty six,

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Speaker 1: So there's a little bit In fact, many of them

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Speaker 1: won't be on the ballot ever again with Donald Trump

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Speaker 1: or with Donald Trump as president, So there's a little

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Speaker 1: bit more security that they have in their minds to

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Speaker 1: try to separate themselves from Trump. And frankly, even if

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Speaker 1: you are on the ballot in twenty six, senators are

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Speaker 1: dealing with a general election electorate. Okay, so a guy

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Speaker 1: like Tom Tillis may be vulnerable to a Trump primary.

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Speaker 1: Challenge of the matter is he only wins a reelection

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Speaker 1: if he can figure out how to win the middle

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Speaker 1: and on this tariff business, which really hurts a state

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Speaker 1: like North Carolina. To he's going to have to sit

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Speaker 1: here and walk a line. He doesn't want to antagonize

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Speaker 1: Trump because I think he would struggle in a primary

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Speaker 1: in North Carolina. And at the same time, you know,

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Speaker 1: if somebody to is right beat him in a primary,

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Speaker 1: I don't think that person can win a general election

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Speaker 1: in these midterms of North Carolina. So that's just one example.

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Speaker 1: But the point is this is what I would watch

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Speaker 1: for over the next sort of three to six months.

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Speaker 1: I think the don't assume that Donald Trump is negotiating

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Speaker 1: with countries. Do I think some countries will get some

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Speaker 1: negotiated reprieve. Yes, I think the UK will not much.

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Speaker 1: Anybody else in Europe, anybody aligned with the EU know,

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Speaker 1: but I think the UK, because of Brexit, he will

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Speaker 1: be more inclined to do a deal there. I think

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Speaker 1: he's likely to do a one on one deal with

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Speaker 1: Japan because the Japanese have basically been courting him very carefully.

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Speaker 1: They've been obsessed with courting him multiple leaders, certainly this

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Speaker 1: ruling party has, and I think he is likely to

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Speaker 1: reward them with some sort of side deal. But for

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Speaker 1: the most part, I think he believes this in his bones,

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Speaker 1: and so I don't think there's going to be a

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Speaker 1: ton of reprieve. So what does that mean? The markets

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Speaker 1: are still going to be volatile, People are not going

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Speaker 1: to be happy. Remember who's watching the stock market the

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Speaker 1: most these days, it's retirees. What's one other thing about

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Speaker 1: retirees that people forget about. They vote, right, the person

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Speaker 1: most likely to vote in a special or election or

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Speaker 1: a midterm election is somebody over the age of fifty

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Speaker 1: they are the most likely voter, so and right now

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Speaker 1: they're the ones most sensitive to a loss in value.

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Speaker 1: Baby Boomers, people in their thirties and forties, you know,

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Speaker 1: you can even look at this moment, Oh, maybe there's

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Speaker 1: a buying opportunity. You know, you're still invested for the

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Speaker 1: long term ten years, fifteen years, touch in your retirement,

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Speaker 1: you might have more patience for this. But if you're

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Speaker 1: in your fifties, sixties, or seventies, aka the people who

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Speaker 1: are the most likely voter and the people the most

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Speaker 1: likely to show up, you're going to be very sensitive

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Speaker 1: to these market disruptions. So I think you're going to

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Speaker 1: likely to see that this is sort of I would.

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Speaker 1: I think this is going to be what the Afghanistan

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Speaker 1: withdrawal was to Joe Biden, is what this tariff bomb

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Speaker 1: that Donald Trump set off earlier this week is going

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Speaker 1: to be for him. That Afghanistan withdrawal for Joe Biden

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Speaker 1: dropped his approval rating anywhere below forty five somewhere between.

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Speaker 1: You know, sometimes could get as low as thirty eight.

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Speaker 1: He never got above forty five again for the rest

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Speaker 1: of his presence. At this point, I don't expect Donald

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Speaker 1: Trump to get above forty four or forty five for

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Speaker 1: the rest of his presidency because of this tariff stuff.

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Speaker 1: So this is likely to make him less popular, doesn't

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Speaker 1: mean he's going to be less popular among the MAGA base.

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Speaker 1: In fact, you see, you know, he's got his propaganda

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Speaker 1: machine going his media. The sort of the supportive folks

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Speaker 1: of his in the media are sort of putting their

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Speaker 1: blinders on and pretending that this is you know, he's

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Speaker 1: got some brilliant plan here, but it's it's it's going

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Speaker 1: to become toxic. You're going to have I think a

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Speaker 1: few things to watch for include House Republicans who decide

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Speaker 1: not to seek reelection. Some of them may decide I'm

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Speaker 1: going to run for governor, I'm going to run for

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Speaker 1: the Senate, but I'm not going to run for the House,

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Speaker 1: because I think a House Republican is going to be

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Speaker 1: a lot more vulnerable in this environment than a Senate Republican.

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Speaker 1: Senate Republican might be able to inoculate themselves some you've

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Speaker 1: already seen a few of them break away when you

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Speaker 1: had ran Paul Mitch McConnell, Lisa Murkowski, Susan Collins vote

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Speaker 1: with the Democrats on that, on the on the Canadian tariffs,

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Speaker 1: So I think you will have some some that do that.

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Speaker 1: If you start seeing the Republican retirements get into the

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Speaker 1: double digits, it almost will be handing the Democrats control

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Speaker 1: of the House. And I think that will be something

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Speaker 1: to watch for because I think you look, we already

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Speaker 1: saw in these Monday elections that the Republican base is

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Speaker 1: not that engaged. At least Donald Trump's base is not

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Speaker 1: engaged enough to win these elections, certainly not in Wisconsin.

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Speaker 1: We saw a place like a Scanbia County in Florida

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Speaker 1: vote for a Democrat for Congress. For the first time

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Speaker 1: since two thousand and six has a Scambia County supported

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Speaker 1: a Democrat either for Congress, do you a Senate or

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Speaker 1: the presidency. Why is that significant? Well, it's Scambia County

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Speaker 1: is home to Pensacola, a naval base. It's got probably

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Speaker 1: the largest cohort of federal government workers or federal government

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Speaker 1: adjacent workers in the state of Florida because of all

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Speaker 1: the adjacent aspects that come with a major naval base

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Speaker 1: like the one in Pensacola. Already see the vulnerability and

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Speaker 1: that's just a reaction to all of the all of

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Speaker 1: the cuts that have been taking place due to DOGE,

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Speaker 1: and certainly some of this comfort onto that now you

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Speaker 1: have this economy that's going to hit people right in

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Speaker 1: the pocketbooks. I mean, the dollar store is going to

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Speaker 1: turn into the ten dollar store. You know, they're not

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Speaker 1: going to be able to find things that cost a dollar.

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Speaker 1: That's going to hit a lot of Trump voters. That's

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Speaker 1: going to hit a lot of red districts. So I

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Speaker 1: don't think he's going to back down. I think the

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Speaker 1: thing that what we all thought about Donald Trump, that

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Speaker 1: he was transactional, that the markets would be a guardrail.

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Speaker 1: I think we now need to realize that this third

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Speaker 1: term stuff is such bs. He's more Thelma Louise here.

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Speaker 1: He's got nothing to lose in his mind. He actually

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Speaker 1: this might be the one thing he has conviction about,

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Speaker 1: and he I think has a higher pain tolerance for

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Speaker 1: the market chile rations, a higher pain tolerance for maybe

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Speaker 1: rich people calling him to complain than the average politician.

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Speaker 1: The average politician, Republican or Democrat, has their largest donor

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Speaker 1: on speed dial on their cell phone. So I think

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Speaker 1: members of Congress are going to be hearing, not just

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Speaker 1: from their constituents with fault and gray phone calls into

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Speaker 1: the congressional offices, but the members of Congress themselves are

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Speaker 1: going to hear from their biggest supporters, who are all

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Speaker 1: going to look at their stock portfolios and panic. So

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Speaker 1: it is hard to see how this gets better for

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Speaker 1: Republicans before now and the midterms. And I know we

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Speaker 1: consider and say this is a long way to go,

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Speaker 1: but this is something, this severing of ties with so

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Speaker 1: many allies. I got to read you this one quote

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Speaker 1: here from the Canadian Prime Minister, which is just an

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Speaker 1: astonishing quote, but it's pretty important. This is the current

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Speaker 1: Canadian Prime Minister, Mark Carney, and he said the following

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Speaker 1: the eighty year period when the United States embraced the

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Speaker 1: Mannal of global economic leadership, when it forged alliances rooted

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Speaker 1: in trust, in mutual respect, and champion the free and

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Speaker 1: open exchange of goods and services is over. While this

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Speaker 1: is a tragedy, it is also the new reality. And

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Speaker 1: that's why I don't think I think Trump had the

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Speaker 1: miscon conception that somehow America was essentially an essential economy

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Speaker 1: and that there's just no way that countries wouldn't essentially

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Speaker 1: change their economic behavior to appease the United States. This

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Speaker 1: is providing a huge opening for China. We now have

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Speaker 1: two of our closest Asian economic allies, Japan and South Korea,

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Speaker 1: who are coordinating with the Chinese on how to respond

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Speaker 1: to the US tariffs. We have the Canadians figuring out

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Speaker 1: with the EU how to coordinate. We have now thrown

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Speaker 1: people countries that we thought were allies of the United

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Speaker 1: States into the arms of China, which seems to be

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Speaker 1: an absolute you know, the unintended consequence that nobody should

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Speaker 1: want left or right. I mean, if we lose our

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Speaker 1: alliances to our chief economic and frankly cultural rival for

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Speaker 1: global supremacy, what have we done? You know, we're not

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Speaker 1: going to like that. So that's why, you know I

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Speaker 1: always say to people who don't want America to be

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Speaker 1: the beat cop, I said, Okay, if America is not

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Speaker 1: the world's policeman, somebody will be. And you're not going

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Speaker 1: to like any other country being the world's cop. You're

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Speaker 1: going to be a lot happier for the world's cop.

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Speaker 1: And we're just seating this turf we are giving China

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Speaker 1: and opening all around the world with countries that were

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Speaker 1: so aligned with US, I never thought those bonds would

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Speaker 1: be shaken. So look, I think this is a Republican

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Speaker 1: Party that's quoting disaster. I'm going to quote Ran Paul,

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Speaker 1: who made a various stute point a couple nights ago.

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Speaker 1: Ran Paul one of the few Republican senators who's been

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Speaker 1: publicly pushing back against these tariffs. This is his sort

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Speaker 1: of core libertarianism in him. A libertarian doesn't want any

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Speaker 1: time gariffs on anything. But he pointed out a very

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Speaker 1: important fact. The Republican Party pre World War Two was

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Speaker 1: very similar to the current Republican Party of today, a

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Speaker 1: bit isolationist. It was the party of business, and back

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Speaker 1: then in the nineteen tens, twenties, and thirties, America's businesses

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Speaker 1: were afraid of foreign competition, and so they did want

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Speaker 1: tariffs because it protected their businesses, it protected their wealth.

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Speaker 1: This is not how the economy works anymore. This is

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Speaker 1: the equivalent of Donald Trump trying to somehow manufacture the

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Speaker 1: ice block industry again. You know, there was the ice

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Speaker 1: block industry used to be a big deal in Europe

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Speaker 1: until we figured out refrigeration and we didn't need blocks

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Speaker 1: of ice to cool our food. And this is the

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Speaker 1: equivalent of trying to turn back the clock to an

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Speaker 1: era that doesn't exist. You know, we put those tariffs

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Speaker 1: in when we were we weren't using airplanes for cargo.

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Speaker 1: Then we were using ships and certainly in this country trade.

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Speaker 1: So it is there's no part of this that makes sense.

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Speaker 1: And trying to look back and say this was some

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Speaker 1: golden age, it wasn't a golden age. We had extreme

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Speaker 1: poverty back in the late nineteenth century, early twentieth century,

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Speaker 1: we had child labor issues, we had terrible work conditions.

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Speaker 1: So I'm not sure what part of that era of business,

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Speaker 1: what part of that era of the economy, is actually

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Speaker 1: something to wish we had again. So you know, this

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Speaker 1: is and you know what happened after that. The Republican

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Speaker 1: Party wasn't trusted with control of the legislative branch for

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Speaker 1: nearly sixty years. Sixty years. You know, they had a

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Speaker 1: brief period where they controlled the House the two elections

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Speaker 1: in the fifties thanks to the popularity of Dwight Eisenhower,

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Speaker 1: but that went away quickly and they went forty straight

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Speaker 1: years with control of the House. This all goes back

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Speaker 1: to the Republican Party and their trade issue and being

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Speaker 1: essentially punished for essentially wrecking the economy in the twenties

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Speaker 1: that led to the Great Depression, and many economists have

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Speaker 1: concluded it was the bad tariff regime, among other things,

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Speaker 1: that put us in that situation. So I can't see

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Speaker 1: a positive outlook politically here for the Republicans. And the

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Speaker 1: question is how when do how many congressional Republicans break

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Speaker 1: for him? And when do they break for him? I

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Speaker 1: explained earlier, I highly doubt the House Republicans will crack

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Speaker 1: because they got there because of Trump. So in some ways,

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Speaker 1: in for a diamond for a dollar, the Senate Republicans

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Speaker 1: want to break, Maybe they'll wait till after they passed

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Speaker 1: the tax cut because they're going to need a lot

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Speaker 1: of help from Trump on that. By the way, you

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Speaker 1: want to talk about stupidity with this legislative agenda by

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Speaker 1: this White House. If he knew he always wanted to

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Speaker 1: do this teriff for all these tariffs, he should have

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Speaker 1: waited six months, gotten his tax cut, then done this. Instead,

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Speaker 1: he's now the tax I think he's put his tax

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Speaker 1: cuts in jeopardy here, because I think this economy is

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Speaker 1: just going to be in terrible shape. Come the end

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Speaker 1: of the summer into the fall, we're going to see

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Speaker 1: all sorts of horrible warning signs. You're going to see

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Speaker 1: a rise of unemployment rate. We've already seen that the

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Speaker 1: parent company of Chrysler and Cheep has already announced TERFF

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Speaker 1: related layouts. And so the tax cut's going to come.

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Speaker 1: I'm sure Donald Trump's going to try desperately to come

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Speaker 1: up with some sort of rebate check of some sort

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Speaker 1: to try to and call it like sort of hey,

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Speaker 1: I'm going to give the first, you know, the first

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Speaker 1: chunk of tariff money that comes in the country. I'm

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Speaker 1: going to give it back to my farmers. I'm going

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Speaker 1: to give it back. And it really isn't you know.

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Speaker 1: All it is is our own money that we paid

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Speaker 1: that essentially is covering the tariff costs then being sent

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Speaker 1: back perhaps in check form. But I'm not sure Congress

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Speaker 1: is going to be comfortable going along with that because

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Speaker 1: whether it'll even come as as believable. But I think

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Speaker 1: he will try something to mitigate this, but I don't

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Speaker 1: think it's going to be getting rid of the tariffs.

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Speaker 1: And even if he gets rid of him, it's not

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Speaker 1: going to solve the larger problem he has already severed.

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Speaker 1: He's already severed all of these economic and potentially national

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Speaker 1: security ties with so many key allies that putting these

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Speaker 1: partnerships back together is going to take decades. It's going

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Speaker 1: to take decades, and it's going to take because the

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Speaker 1: concern this is now twice that America's elected him, and

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Speaker 1: this disruptive ideology. So our European our traditional European partners,

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Speaker 1: are traditional Asian partners. They're not going to quickly get

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Speaker 1: back into bed with us, even if the next term

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Speaker 1: is sort of somebody who is a non a president

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Speaker 1: who isn't in favor of trump Ism. But it's going

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Speaker 1: to be a long seventeen months, so I think people

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Speaker 1: will have to prepare accordingly. I think you will see

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Speaker 1: a pullback and spend and that will be just all

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Speaker 1: of that will be a domino effect. But I do

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Speaker 1: expect Congress will finally find its spine and take its

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Speaker 1: tariff power back from the presidency. But it may not

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Speaker 1: happen until you have at least one chamber in Democratic hands.

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Speaker 1: And I think of at the House, if the Democrats

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Speaker 1: pick up the House and Republicans, even if it's you know,

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Speaker 1: Republicans don't lose a single senency. I promise you there's

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Speaker 1: a large majority that if they know it, can they

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Speaker 1: know they have the votes in the House to do it,

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Speaker 1: they will take the tariff keys away from the mad

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Speaker 1: King here. And I think that likelihood is quite high

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Speaker 1: that this is This is potentially one of the greatest

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Speaker 1: political disasters. This is I'm trying to come up look

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Speaker 1: for other equivalents. Maybe this could be as bad as

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Speaker 1: what happened to Democrats in ninety four with the assault

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Speaker 1: weapons ban, with healthcare. Perhaps this is as bad as

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Speaker 1: the Tea Party for the Republicans for the Democrats in

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Speaker 1: twenty ten. Perhaps it's Watergate nineteen seventy four. But I

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Speaker 1: think this is not going to be a small ripple.

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Speaker 1: This is going to be a gigantic crack here. And

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Speaker 1: who knows it. Perhaps perhaps this leads to a new

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Speaker 1: fight inside the Republican party. Maybe there are primaries. I'm

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Speaker 1: not there yet. I think as long as Donald is

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Speaker 1: king of his party, you're not going to see successful

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Speaker 1: primary challenges. But I do think if this does lead

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Speaker 1: to what happened the last time the Republicans played with

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Speaker 1: terror fire and it leads to huge successes for the Democrats.

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Speaker 1: You will see the Republican Party have a real fight

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Speaker 1: over the direction post Trump. But for now, prepare for

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Speaker 1: a very tumultuous and likely This is You know, Donald

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Speaker 1: Trump's life just got so much harder to politically conduct

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Speaker 1: this presidency. Good luck everybody. M