On Monday’s episode of “The Michael Knowles Show,” Knowles debunks some of the misconceptions regarding the trade war and shows how President Donald Trump has actually landed a victory for the United States. Video and partial transcript below:
This trade war has been so misrepresented. Most people have no idea what’s going on, part of that is because trade negotiations are extremely boring, and they’re extremely complicated, and all shallows are clear — and if you think that there is a simple answer to our trade relationship with China, you are completely out of your mind. The only wrong answer on trade is that it’s simple. It’s really, really not simple.
This trade relationship has been pretty poisoned since 2001 when we stupidly let China into the World Trade Organization. We had no leverage on it whatsoever. It was completely unlike our letting other economies in, like South Korea or Japan, where we had military leverage over them. We were providing a lot of their defense — they were relatively small economies — we could manage that relationship. China — not the case. They had over a billion people. Huge economy. Obviously, they don’t rely on our military protection. From the beginning, this was a tough problem. They’ve been cheating from the beginning; they’ve been stealing our property, illegally subsidizing steel and aluminum, stealing our jobs by illegally devaluing their currency. So, it’s not just that it was the natural flow of market forces that took some of our manufacturing jobs away to the tune of 3 million or more. That’s not what happened.
We would have saved millions of jobs had we stopped them from illegally devaluing their currency, which violates the World Trade Organization treaties — and it’s something that we can’t really fight against because if we devalued our currency the world would spin into economic chaos. Because we are the superpower, we are the global reserve currency.
I’m not even scratching the surface on how complicated this trade relationship is, I’m just telling you it’s very complicated. And so when people say you know drop the tariffs that is just nonsense. That is not an adult way to handle this. So, this trade war has been heating up it’s been tit-for-tat, tit-for-tat.
China goes hardcore in its negotiating position. People walk away from the table — things are looking really bad, President Trump has to face re-election in 2020. Then apparently, allegedly, the White House called, or China, rather, called the White House over the weekend and asked the White House to get back to the negotiating table. Why? Because President Trump said — rather than backing down on the tariffs, which he also signaled he might do — that he would raise the existing duties on a quarter — on 250 billion dollars worth of Chinese products to 30% from 25% starting on October 1. He also said that tariffs on another 300 billion dollars of Chinese goods would take effect on September 1, and they would now be 15% to 10%.
So, he just, at the moment when it seems like he’s going to back down because it’s hurting his own base — It’s going to hurt him in re-election — he says nope I’m going all the way baby. I’m turning the covfefe up to 11. Guess what happened? The Chinese Yuan fell to an 11-year low against the Dollar.
In China, it looked like the U.S. was going to blink. Now it looks like the U.S. isn’t going to blink. China, perhaps, is blinking. This is a huge win for the United States.
It doesn’t solve the problem. It’s not even close to solving the problem. It just shows that we’re moving in the right direction and the left is furious about that. Here is the CNBC headline reporting on this latest turn, “Chinese newspaper editor” debunks “Trump’s trade war claims: China didn’t change its position.” Oh, ok. Well, if the Chinese newspaper editor said that, what newspaper was that by the way? Could you? Ok, let me see you. Johnson is editor in chief of The Global Times, a tabloid under the People’s Daily, which is the official newspaper of communist China.
It’s the official party newspaper.
Oh, oh you’re saying that the Chinese government disagrees? The Chinese government doesn’t want it to become clear that the U.S. has just won its position on the trade war? Well, if that’s so, I wouldn’t have expected that. Thank you for reporting that CNBC, for carrying the pravda of China and end their propaganda against the United States. It’s ridiculous.
This is good news. I mean, I hate agreeing with Chuck Schumer on anything. The only place I’ve probably ever agreed with the guy — two places: On the Iran deal and on this trade war with China. He said not to back down. It requires a lot of political courage for President Trump not to back down on this issue. But it’s very important that he doesn’t. I think if he does blink, if he does back down, actually, it will hurt him in the 2020 presidential election because it will show he’s weak and he’s weak on one of the biggest issues facing our country. And one of the biggest issues he talked about on the campaign trail the other reason, I think, he shouldn’t back down is I think he’s going to win. And I don’t think that Americans are going to vote based on bean-counting.
I don’t think that we’re going to vote because GDP is a little bit lower. If we go into an all-out recession, we might have some trouble in re-election, but otherwise, people want to win. They want to solve this problem. They want someone to fix it. Neither party has done it for 20 years and they want Americans to be respected — American jobs, American manufacturing — they want to make America great again. This was Reagan’s call in the 80s, actually, pursuing similar policies. This is Trump’s call now, I think it’ll work. You gotta stay strong. He’s done a good job so far, it’s probably the highlight of his administration. Even though some Nervous Nancys on the Right were clutching their pearls And who are nervous that their stocks are going to tick down a few days out of the week are saying that he should give up and let China eat our lunch. Terrible idea.
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