TRANSCRIPT
The Takeout (CBS) – Senior Counselor for Trade and Manufacturing Peter Navarro Interview
MAJOR GARRETT: I'm going to walk over to the conversation corner because I'm going to be joined by the President's top trade and manufacturing advisor. His name is Peter Navarro. Peter is coming out from behind the takeout. Marque, it's great to see you. Thanks so much for joining me. Please have a seat.
SENIOR COUNSELOR PETER NAVARRO: I appreciate that.
GARRETT: So let's deal with the Fed. Right off the top.
SENIOR COUNSELOR NAVARRO: Right off the top. Boy, that was.
GARRETT: Give me your assessment.
SENIOR COUNSELOR NAVARRO: Well, here's the problem. The fed chair is a lawyer, not an economist, which is a rare thing In the last 50 years.
GARRETT: President Trump did appoint him and he was reappointed by President Biden.
SENIOR COUNSELOR NAVARRO: And the problem is he simply doesn't understand the power of Trumpomics to actually grow our economy without creating inflation. And for the last six months, we've seen every inflation indicator go down. We've seen positive indicators, and I don't know what this guy's thinking.
GARRETT: You don't mean in an aggregate sense, you mean not as high as people were fearing that they would go because there have been some,
SENIOR COUNSELOR NAVARRO: It's been going down, but we always beat the estimates. I mean, today it was like 1% lower than it was last month. But here's the point. It's like when he holds the rates up like he's doing, that imposes real costs on the American people. If you're trying to get a mortgage, you can’t.
GARRETT: That's why I mentioned the lagging indicator is housing, construction, housing sales, and consumerism around those parts of the economy,
SENIOR COUNSELOR NAVARRO: We've got debt that we got to finance. 20 to 30% of the debt we finance is short-term debt that we use. So we're paying tens of billions of dollars more for that. It's suppressing GDP growth is probably going to cost us a half a point of GDP growth, which is about 750,000 jobs. I don't know what this guy's thinking other than the fact that I know what he's thinking.
GARRETT: President's displeased but not going to fire him.
SENIOR COUNSELOR NAVARRO: See, what I was hoping for, and I'm still hoping for this, is that the board of Governors themselves, there's seven people that make this decision. It's not Powell, he's not a dictator on this. Problem is that four of the appointees or Democrats and then Powell. So you got five out of seven who might be kind of anti-Trump, but they got to get over that. It's like everything says cut rates. We should be at least 50 to maybe even a hundred basis points lower now than we are. And that would be a tremendous boon to everybody.
GARRETT: Let me ask you some very basic questions about what's coming ahead. August 12th is the deadline for China and the US to resolve its trade differences. The treasury secretary Scott Besson said earlier this week, it will probably be a 90 day extension. The Chinese are basically announcing there'll be a 90 day extension. Will there be?
SENIOR COUNSELOR NAVARRO: Well, as the boss says, let's see, I never get ahead of that, but things were going well. They were in Scott Bessent and Jameson Greer were in Stockholm for three days talking to the Chinese and went very well. We're in a very good place. It's regrettable that the Chinese will not do seemingly anything about killing Americans with fentanyl. That one really hits close to home for a lot of people, but that one's going well. So let's just see what happens. We do have over 50% tariff on them and that's more than appropriate because of the unfair trade practices that they impose on us. So we're in a good place. Look, Gary,
GARRETT: That's good. So what are you saying? There's going to be an extension and that deal's going to get done by year end.
SENIOR COUNSELOR NAVARRO: Let's see what happens. I never try to, I never break news. I just simply report what's happened so far, but try to get behind the scenes.
GARRETT: But you're discouraged about China on fentanyl and the President is,
SENIOR COUNSELOR NAVARRO: Look, they're killing people. I was here in the first term, the president of China said in 2018 he was going to solve the problem for us and now they've even got a new designer drug Nitizene. I dunno if you've heard of this. It's five times more powerful than fentanyl. It's all comes from China. So that's got to be dealt with
GARRETT: Within the context of trade talks,
SENIOR COUNSELOR NAVARRO: Within the context of trade talks. But the big picture here, I think what I can add today is we are doing something. The president is doing something that's absolutely incredible. He's completely in six months restructuring the entire international trade order that's been screwing Americans since it started back in the seventies. It's unbelievable what we're doing. If you'll get every trade deal that we've done, every trade deal that's being negotiated, we are going to be in such a better place. We're going to dramatically reduce our trade deficit, which means we don't transfer wealth, which means we have more jobs, we have more factories. We're going to be able to work with these countries in a much war way. I mean, we never had a farm trade deficit until about, I don't know, six to eight years ago, and now it's like too much. Our farmers are getting killed, our fishermen. That's why market
GARRETT: That's why market excess with the eu, with Japan, with South Korea with other countries is so important.
SENIOR COUNSELOR NAVARRO: And the difficulty here, but the beauty of it is that every country's like fingerprints. They're all different in different ways. So we have the trade rep, Jameson Greer is really good at this. We have a template that we go in cross about seven verticals. It's like what are their tariffs? What are their non tariff barriers? Do they engage in digital taxes? Do they have a VAT tax or what are they doing on things like fentanyl or other things that they can help us out with? And based on that, they go in, negotiate a deal that goes to the president. Nothing ever gets done without his approval and we are in such a better place. I mean that Japan deal, if you look at that, I mean we're getting three quarters of a trillion dollars of free money that's going to come in and be used to invest, this is the kicker here, in all of the things that we are vulnerable internationally with our supply chain. In other words, that money's going to help us resolve a lot of our supply chain vulnerabilities, which both cause us strategic problems but also create inflation as we learned in the pandemic.
GARRETT: You're going to stay for our second segment, so we're going to continue this conversation. But before we go to break, how much does resolving the question about the future of TikTok and American ownership factor into a final negotiated trade deal with China?
SENIOR COUNSELOR NAVARRO: I'm totally removed from that one, so I can't provide any insight.
GARRETT: So to your knowledge, you don't know if they're even connected.
SENIOR COUNSELOR NAVARRO: Zero insight on that one.
GARRETT: Very good. The president talked about 25% tariff against India today.
SENIOR COUNSELOR NAVARRO: Let me tell you what the problem with India is. Apropos this, every country's like fingerprints. I call India the maharaja of tariffs. Whereas Japan, it was the king of non tariff barriers. The things that you do to block us going in their markets. India is just, they have the highest tariffs in the world and they just won't lower them. And the reason why when we have trouble with a country negotiating with 'em, they don't want to give up a good thing. The other thing that's annoying to the president is that we have a lot of arm sales to our allies. We love arm sales. I did a lot of that. I was pointing on a lot of arm sales in the first term. You get two things going there. It's like when you sell an F 16 somewhere, you don't have to send troops over there. Plus we get jobs. India buys all their crap from Russia. Okay.
GARRETT: President wants to change that. Peter Navarro. We'll continue that line of conversation. We come back for our second segment of the evening with Peter Navarro.
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GARRETT: Welcome back to takeout. Continuing our conversation with top Trump White House trade advisor, Peter Navarro. So there are lots of fangled and fangled words in the trade world. De minimis is one of them. Let's break it down. What it means is in this context, packages shipped into America $800 or less were exempted from any tariff. Now as of August 29th, they will not be small. Businesses care about this because they do some of their business that way. If you're Etsy rather, eBay, things like that. Why is this a good idea? Why will this not harm small businesses in the country?
SENIOR COUNSELOR NAVARRO: It is just a huge win for the American people. You had every country in the world, if they have a de minimus thing, it's like $10 or $20, whatever. Ours in America got way out of hand. It went all the way up to $800 and there's all sorts of fraud,
GARRETT: Too generous in other words,
SENIOR COUNSELOR NAVARRO: It's way too generous. And what this will do is basically protect all the manufacturers and the jobs they're in who make the kind of stuff that's now coming in free of tariffs. Yeah, sorry. The reason why we put tariffs on products from countries is because they cheat full stop. And when they cheat, products come in, they steal our jobs, they shut down our factories, wages go down. So the logic of tariffs is to stop that. But when you provide this giant loophole, I mean this loophole is the biggest loophole in trade law. It's like $800. You close that. This is literally going to mean a couple of hundred billion additional in revenues collected over the next few years. And how many schools can you build with that? How many roads can you build? How much debt can you reduce? So this is a great thing for America. And the beauty of this is the critique of tariffs from the day I got here in the first term was it's going to create inflation. Consumers going to pay. We've seen no sign of that at all. None. Inflation. And the reason is because they eat it. The foreign countries eat it.
GARRETT: They're all eating it because they need access to our market.
SENIOR COUNSELOR NAVARRO: That's right. Exactly right. And there's economic theory on that. It's like when you're the biggest country in might the market,
GARRETT: So it might not eat 30% or 50%, but they can eat 15% and basically keep things as they were or just slightly more expensive.
SENIOR COUNSELOR NAVARRO: The rule is the bigger the trade deficit that we have with a country, the more they can eat. Okay, because feasting on us
GARRETT: And you're touching that right now,
SENIOR COUNSELOR NAVARRO: They're feasting on us and all we're asking 'em to do is eat a normal meal instead of that feast.
GARRETT: Talk to me about copper. 50% tariff on copper. This is semi-finished copper and copper intensive derivative products that touches a lot of things that flows through our economy. Why do we need 50% tariffs on copper?
SENIOR COUNSELOR NAVARRO: Here's the deal Major. This is a highly strategic critical mineral, particularly in an age of ai, in order to benefit from artificial intelligence, we're building all sorts of new kind of things to service that, whether it's the power plants or whether it's the data centers and everything in between. We need copper. Now. We used to be an exporter of copper, but this is yet another example, and I could literally sit here and give you about 30 of them, of how China has used unfair trade practices to commandeer a critical part of our economy.
GARRETT: Hollow it out.
SENIOR COUNSELOR NAVARRO: What they do is they dump the products into our markets, the low cost driver folks out, and they have the advantage where we want, mines say in Arizona, we have really cumbersome regulations and things like that, very hard to get mines built. They come in and they just wipe us out. What this executive order will do was completely revive our copper industry. We have plenty of copper here to meet our entire domestic demand. So this is a really important,
GARRETT: A way of incentivizing a renewed production and exploration of,
SENIOR COUNSELOR NAVARRO: and what we learned from pharmaceuticals in the pandemic and is that we're vulnerable. What we learned just recently with rare earths and the magnets, which are a critical part of Apple phones and autos and everything in between, is that when other countries like China have the capability to withhold that supply, they can engage in coercion of us. So with this copper thing, we're going to see an EO on 232s coming out on pharmaceuticals. That one's moving down the road. We've already done autos, we've done steel, we've done aluminum. All of these things to make America great again. That's the purpose. This copper one's really important.
GARRETT: Quickly, what's coming ahead for Mexico and Canada? Because both have unresolved trade disputes with the president. Some of it is exempted because of the USMCA, but there's still things unresolved and the Canadians and the Mexicans still keep saying publicly, they're trying to get things resolved. What's the timeline? What's the expectation?
SENIOR COUNSELOR NAVARRO: That's a good question. And there's negotiations ongoing on a daily basis with Jameson Greer, the USTR or Howard Lutnick at the Department of Commerce. Scott Besson, depending on the country, gets involved as well. My role in all of this is to do the analytics behind to see what the best deal would look like based on the specific country. So what I can tell you here is our problem with Canada is that as much as we love the Canadians and as friendly as they are, their government has really been sticking it to us for decades. And one of the big problems, for example, is lumber. All of our lumber is private, private lands, private companies, this, that, and the other thing. We're having to compete with Canada, Inc. All of their lumber is on public lands and what they do,
GARRETT: they're more subsidized
SENIOR COUNSELOR NAVARRO: Heavily subsidized. And what they do is they dump into our markets, they shut our mills down, they shut our farm. So that's a real hot button. But there's other things. There's some farm products like dairy that they stick it to us and they're just so arrogant when it comes to dealing with them and they learn the lesson. You'd better not retaliate against the United States
GARRETT: And quickly. Mexico.
SENIOR COUNSELOR NAVARRO: Mexico. Boy, that one. We have just a huge, huge trade deficit with them. There's just a lot of things we got to work through, but we're working through. Let's see what happens.
GARRETT: And you'll come back and explain
SENIOR COUNSELOR NAVARRO: I’ll come back
GARRETT: When we know the details.
SENIOR COUNSELOR NAVARRO: I love being here. I wore a tie for the occasion, but apparently that was the wrong thing to do.
GARRETT: Sir Peter Navarro, we'll have you back. I appreciate it. Thank you very much for your time.
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