納瓦羅探討川普政府的美國經濟策略

大家早上好,歡迎,很高興看到你們 我記得在我來美國的時候 我會嘗試讓人們對貿易有興趣 他們的眼睛會轉動 我以為這樣很無聊 我想感謝川普總統 讓貿易再次成功 因為除了這個房間 我們還有約四百人 約四百人在線 總統大會的主要功能 是讓我們的成員有機會 與世界上最有影響力的 政策家和領導人 我們正在尋求 遵循廣泛的角度 來邀請發言人 這是我們國家 最少的機會 可以在星期天 與伊朗國務卿 和伊朗總統的兒子 伊朗總統見面 這是幾個星期前 在這方面 我非常高興 總統大會 持續了長久的 不分黨派的傳統 邀請了雙方的 進行開放、堅定 和尊敬的對話 不得不說 我無法想像 總統大會的主要功能 是讓我們的成員有機會 與世界上最有影響力的 總統大會的主要功能 是讓我們的成員有機會 尊敬的 不分黨派的傳統 對話 我無法想像 總統大會的主要功能 尊敬的 After all, it's not every day I get to speak for an audience that has opposed nearly every policy I've ever helped advance in the White House. But let's be honest with each other. CFR has been uniformly anti-tariff and anti-Trump and highly skeptical of an America first foreign policy that in truth is restoring our trade balance, rebuilding our industrial base, strengthening alliances like NATO, keeping and as we just saw in the Middle East, negotiating the broader peace, and reasserting American sovereignty on the world stage. So let's ask ourselves the obvious question. How did the gulf between the Council on Foreign Relations and Trump world grow so wide? If you ask an AI search engine, try this, I did. It will tell you that the Council on Foreign Relations embodies an establishment technocratic and globalist ideology, one comfortably wedded with Wall Street and the multinational corporations that love open borders, cheap offshore labor, and an endless stream of subsidized imported goods. By contrast, the Trump administration since 2017 has stood squarely with the people who make and grow things in this country, our farmers and ranchers, our manufacturers and workers. What many in this audience dismiss as populism or nationalism simply means doing what's best for Americans first, protecting our jobs, communities and the industrial base that anchors our national strength. History is indeed a harsh mistress here. Exhibit A, the Council on Foreign Relations members helped negotiate NAFTA, which hallowed out the U.S. manufacturing base and triggered one of the largest illegal mass migrations in modern history. CFR analysts championed China's 2001 entry into the World Trade Organization, the single worst trade deal, the single worst trade deal in American history. Then came the Trans-Pacific Partnership. Forgive me here, Mike. CFR sold it as a geopolitical rampart against the rise in China. Yet the TPP would have surrendered much of America's manufacturing base, including our crucial auto and auto parts sectors, to Japan, Vietnam, and ironically, ultimately, China itself. President Trump saw this very clearly and tore up the TPP on day one. I was standing right behind him on that beautiful day. This is what the Council on Foreign Relations has never understood. Weakening our industrial base has never strengthened our strategic position. It has only invited aggression. That's why in Trump world, we do not trade off economic security for national security. We believe economic security is national security. Memo to CFR. You cannot project power if you surrender production. You cannot deter aggression when your supply chains run through your opponent's ports. You can't lead the free world if you can't make what the free world needs. Here's the second big problem with the Council's free trade dogma. The belief that the World Trade Organization somehow delivers fair trade as well. By its own rules, it does not. The WTO's most favored nation, MFN rule, says you must treat all partners the same. But what it doesn't say is that everyone must charge the same tariffs. So what happens? Virtually every country in the world charges America far higher tariffs than we charge them. Germany, for example, charges us 10% on autos. We charge them 2.5%. The result? Bavaria sells us 7 cars for every one Detroit sends to Germany. That's the tilted playing field that the Council on Foreign Relations has defended and the one President Trump has begun to level with his policy of reciprocal tariffs. Of course, the moment President Trump uses the T word, CFR waves the bloody shirt of what? You know what I'm about to say? Inflation and recession. But the record tells a very different story. Under President Trump's first term, inflation stayed low, growth was strong, and the American manufacturing base saw its first real revival in decades. Far from tariff chaos, Trump world had price stability and the strongest job market in modern history. Let's be clear. The inflation we're living with today did not come from tariffs. It came from Joe Biden's reckless fiscal expansion, his neglect of our supply chains, and a hopelessly politicized Federal Reserve that accommodated the Biden bonfire. That's why we in Trump world now hold the credibility high ground on tariffs. Exhibit B. During the Trump first term, and you all remember this, CFR's predictions of economic calamity widely missed the mark. The inflation and recession that you all forecast never came. The alliances you said would disintegrate have endured those wars you predicted for four peaceful years during the Trump first term. China, Iran, North Korea, and Russia kept their powder dry. Now in his second term, President Donald John Trump is once again performing beautifully. And it's long past time for the Council on Foreign Relations to catch up with a world it refuses to understand. In closing, in closing, I come to you today not to quarrel, just to simply challenge respectfully the assumptions that still dominate this room. The world has changed. The American people have changed. The age of blind globalization is over. If the Council on Foreign Relations wants to be relevant, it must stop mistaking nationalism for isolationism, sovereignty for retreat, and strength for aggression. For ultimately, MAGA and the America First movement isn't about pulling back. It's about standing tall. It's about defending what we make, who we are, and the nation we love. Thank you for your time. I look forward to your questions. And Anna Swanson of the conservative New York Times is going to grill me here. All right, great. Well, that was quite an opening. Welcome to today's Council on Foreign Relations meeting on U.S. trade and manufacturing with Peter Navarro. My name is Anna Swanson. I'm the trade reporter at the New York Times. And I'm really delighted to have been invited to do this both at the Council on Foreign Relations and to have this opportunity to speak with you right now, Dr. Navarro, at a very pivotal moment for trade. And I should say here, I'm glad that Ms. Swanson's doing this. Despite the liberal direction of her paper, I think she's done some of the finest reporting on the China trade issue, particularly on a topic which I'll be saying a lot more of soon on this trans-shipping. But happy to be with you and see what you got. OK, great, great, great. Well, yeah, there's a lot to talk about, so let's dive right in. So I thought I would start with the world stage, which your remarks touched on. So, you know, you have said previously that with the exception of China, no other country in the world actually ended up retaliating against the president's tariffs. And the president's tariff threats have been remarkably successful in getting concessions from other countries on trade. But I'm wondering, is there any other downside to the administration taking this extremely aggressive posture toward other countries, including allies? So we hear that the Japanese, the Europeans, the Canadians are all taking measures to either be more self-sufficient or to, you know, trade more intensely with other partners. Does the United States stand to lose something in the longer run from taking this more aggressive posture toward the world? No. I think what we clearly will see is a significant strengthening of our alliances around the world. It is remarkable that there was no retaliation against the United States by almost all countries. But I think that it was the fruit of the first term. We have continued to make the argument, as I did today, that the World Trade Organization set of rules are fundamentally skewed against the United States, the MFN rules. And we have said for years now that we face higher tariffs significantly and higher non-tariff barriers that we won't tolerate that and then if we are able to restructure that imbalance, it will be good eventually for everybody. And I think countries have acknowledged that, yes, it's not been fair to the United States. And so we've been able to fundamentally restructure the entire international trade system through the leadership of President Trump in a way which this council never envisioned, in a way I don't think anybody in the press envisioned, but it's happening literally. History is being made every day before your eyes. And it's because of the president basically saying the emperor had no clothes out there in free trade land, that we were getting cheated and he wasn't going to tolerate it anymore. So we think our alliances are strengthening and candor among world leaders has been never higher. It's a very tense moment right now with relations with China in particular. We've seen this... I don't see them any more tense than they've been. I mean, we went through... See, I have... I'm burdened by the institutional memory. I was one of only three people in the senior White House ranks in the first term who was there for the whole time. And before that, during the campaign. So, I mean, what's going on now is very similar to the interplay we had in the first term. I mean, Bob Lighthizer and I took a year and a half negotiating with the Chinese and there was like terrorists back and forth and conversations with the presidents and things like that. So, I mean, I don't see this as anything out of the norm. Well, tariffs back and forth. But right now there is a threat of an additional 100% tariff on China, right? China is looking at export controls on rare earth minerals. But we had similar tariff interplay in the first term. And it all sort of worked out. I mean, we got the 2020 what was called the skinny deal. And the only problem with that is we left office and the Chinese didn't abide by it. But look, as the boss likes to say, let's see what happens. The presidents are going to meet at the end of the month. And I think they understand the landscape well. We'll see what happens. What is the president having to get out of that meeting? We have to put the president in his seat to ask that. I mean, what we want in this country, I think what everybody in this audience should want, unless you've got a lot of shares in a multinational company operating in China, is simply a situation where fair trade is the rule where our workers and our manufacturers, our farmers and our ranchers can compete fairly in a way which preserves our manufacturing base and our agricultural strength. What we're learning, Anna, and the Chinese keep teaching us this lesson, and this is something I worked on very hard in the first term, is that there's gaps in our supply chain because of decades of offshoring to China and other foreign lands that threaten our resilience. And we saw that. I mean, one of the things the pandemic taught us was that we don't have resilient supply chains in times of global crisis. So we're going about the business of fixing that, what I call in-trump time, which is to say as fast as possible without screwing it up. But this is something that we need to embrace as a nation. And it's something that you don't read about in the free trade books. Ricardo never talked about rare earth magnets. I do want to ask more about that approach, but just quickly, do you think that the additional 100% tariffs would go into effect on China, though? Wouldn't that be pretty economic? I'm going to leave that up to the boss and Scotty Besson with Jameson Greer as left shoulder and back in the homeland, Howard and I provide them all the analytical support we can. Let's just see what happens. I mean, if we learn anything from the first term, it's that these are difficult negotiations and you just got to trust in Trump. Do you think the president would be open to an offer of Chinese investment? Again, again, I mean, there's so much we can talk about here that's not China that's arguably of even greater import. Because if you think about what we've done, and again, I would say I was pretty strong in my remarks with respect to the council here, but let me just double down on that a little bit. I mean, did you ever envision in your wildest dreams, and was Mike ever sitting in his office and thinking that we could go to any given country and take seven verticals, tariffs, non-tariff barriers, digital, currency, national security issues and sit down and say, hey, look, we're doing this differently and you're going to do it in a way which is fair to us. And so we can go to Europe. We've done a deal with them. We can go to Japan. We've done a deal with them. We can go to Korea. And not only are they lowering their trade barriers, tariffs and non-tariff barriers, they're sending us a boatload of money so we can invest in things that protect our economy and our national security even as we help increase our ability to defend them. So, I mean, nobody in this room, nobody out there in Zoom land ever thought that was possible, but if you think about it, that's exactly what we should have been doing for the last 30 years. You talked in your opening remarks about boosting production, but if you look at the data right now, the U.S. is losing manufacturing jobs, spending on factory construction is down significantly from last year, and manufacturing is still shrinking as a share of the economy. S&P Global also had an estimate recently that tariffs would cost businesses upwards of 1.2 trillion in 2025. So, of course, you know, there are some businesses that tariffs really do help, but, you know, others say that tariffs are making it harder for them to manufacture in the United States because of the higher cost of inputs, of steel in particular. You know, tariffs may be helping some companies, but are they backfiring for others? Let's sort that into a couple of buckets here. It's what are the impacts of tariffs? So if you think about that, again, as I said in my opening remarks, we have a credibility high ground here, okay? We just do. I mean, one of the fun things, my trustee assistant there, Adam Milan, is sitting right at the table there. One of his first assignments I gave him, I said, go out and look at the remarks of every single TV anchor, every single print reporter, every single think tank person and tell me what they said about tariffs with respect to inflation and recession. What was their predictions? And so whenever I have to go on TV or go into an audience like this, I can quote exactly what they said and how so very wrong they were, okay? I mean, just go back during the first term and look at all of those studies that you're citing now, like what did they say in the first term? They all predicted inflation. I had two. I'm quite honored by this, actually. The highest honor to be the named in the headline of the lead editorial twice by the Wall Street Journal, not the Main Street Journal, the Wall Street Journal, the Navarro recession, okay? None of it ever happened because the economics are wrong, okay? Let's just take the tariff thing. Let's do the economics. We're serious academicians here, okay? It's like who can bear the burden of a tariff as opposed to a tax? With a tax, it's consumers or businesses. With a tariff, it's consumers, domestic businesses or the country that's being tariffed, right? Now, if the country that's being tariffed has to be in our market or their economy is effectively going to collapse, what do you think they're going to do? They're going to eat the tariff. And that's why, Anna, we didn't observe all these alleged impacts. We didn't see... Steel and aluminum did great during the first term. We didn't see any negative from that. So, I mean, I just... If this were the first term, I'd have a hard time answering that question. It's easy now. It's like they were all wrong then. They're all wrong now. Well, there was an estimate by Goldman Sachs, I think, earlier this week. Who? Who? By Goldman Sachs. Oh, come on. You're killing me. You're killing me, Larry. You know that commercial? These people... Come on. They have no credibility. I'm sorry. These people have no credibility. Goldman Sachs, look. Let's look at the business model. What's the business model? The business model is to get a bunch of investment that goes over to China. They've been doing that for 40 years. If this is the first term, I could be sitting here with Gary Cohn, who I had to fight with every day in the frigging White House till he left with his tail between his legs, saying the same stuff. It's just... It's not true. Well, setting that aside, so are you seeing the effects in manufacturing from tariffs that you want to see? Now, this is the other key thing you said because you said this was really important. So let's go back to the question you asked. It was like you noted that there was manufacturing jobs going down instead of up. But let's think about this. You can't have the manufacturing jobs until what? Until the plants get built. We got $19 trillion. Let me say that one more time. $19 trillion of investment promised to come into this country. Now, construction is going to boom in the short run. But we're not going to see the manufacturing jobs until that capacity gets built. So it'll be six months, nine months, 12 months, 18 months. But what we're doing is setting the stage for the construction of a beautiful addition to our manufacturing base. And by the way, this is how smart... Not me, but we are as an administration. It's like when we're cutting these trade deals and Japan's offering to invest here in America, that money, you know how we're going to use that money? That money is specifically targeted at vulnerabilities in our supply chain. Think about that. That's exactly what we need to be doing. So foreigners are going to be paying to fix the vulnerabilities in our domestic supply chain as part of a broader trade deal which levels the playing field for American workers and businesses. That's a good deal. Do tariffs raise the cost of manufacturing here, though, which could make it harder for businesses to export from the United States? We don't see it. We just don't see it. And let's suppose it did a little bit, okay? Do you know what the cost is when you don't have a resilient supply chain? Do you know what the cost to our economy is when we can't produce what we need to produce because our supply chains didn't deliver what we needed to? In terms of sheer lives in the pandemic, it was millions of people that we could potentially lose. But we fixed stuff. I mean, I can give you a story from the pandemic which is relevant to the whole rare earth question because the question is how quickly can we fix that vulnerability, okay? So if you go back during the pandemic, is anybody in this room had to go through a ventilator? Anybody? Or had a family member got... Yeah, here we go. Okay. They saved their life? Yeah, yeah. Those things are... They're risking it on themselves. But I remember early in the pandemic, the administration was very, very heavily criticized for not having enough ventilators. Like we were somehow asleep at the wheel. And what we did was identify a small company that had a really, really good technology but the inability to scale quickly. And what we did, and I was the point on this, I was the Defense Production Act Policy Coordinator, was to marsh General Motors to bring its scale abilities, work with that company. And does anybody remember how many days it took us for GM to produce a ventilator? Anybody? So nobody read my first book on this. Shame on you. 17 days. 17 days we were able to get ventilators. And no American went without a ventilator. It was truly one of the miracles of the pandemic. And my point here, Anna, is that no one around the world should underestimate the ability for the Americans manufacturing a technology base to quickly mobilize. And this is the kind of thing that we're going about our business doing because we have a number of vulnerabilities. There's been an interesting development, too, in the administration taking stakes in companies, including the rare earth industry, but also U.S. Steel, Intel, talking about taking more. How are you deciding which companies to take equity in and which not to? What are your next targets? Well, that's not my lane. I stay in my lane. The one thing I think that might be interesting for you folks to think about because to the extent that you're free market capitalists and might be offended by the government taking equity positions in companies, I can assure you that this would not be happening if not for the fact that the companies we were taking stakes in were showered with free taxpayer money, even though they were billions and billions of dollars or trillion-dollar companies. We just gave them a bunch of money. And so the thought process here is simply that we should take some of that back and get effectively some skin in that game. And I just, I mean, for anybody to argue with that I think is silly. I mean, what you should have been is outraged that we were giving that money away as grants for free rather than having some other kind of structure. But as far as the future on that, I'm going to let Howard and the boss handle that. Do you have any thoughts, though, on, you know, what could the government do as a stakeholder that private companies cannot or how far do you think the government should go? Like, for example, is it worth this if it ends up being a net loss to the taxpayers of the government? It's really not my lane. I mean, the one thing I'll say just from an economist's point of view, again, channeling my pandemic experience is like when you're facing supply chain vulnerabilities that in the event of a failure can cost your economy trillions of dollars, you should be less worried about losing a few billion and more worried about fixing the problem, OK? Which is not to say that I'm in favor of throwing away billions of dollars. I'm just saying that the problem of supply chain vulnerabilities is they have very, very high costs. So we've got to be very careful about making sure we get that done. Switching gears a little bit, do you have any thoughts? By the way, the other thing I think is important to point out when you're talking about money here is that we've essentially gone back to the future pre-1913 to a world before the income tax in which there is now it's well understood on Capitol Hill and elsewhere in this country that tariff revenues are a very effective way to raise revenues, particularly when the countries are eating the tariffs, not us. And that one of the beautiful upsides, externalities, if you will, of the president's trade policy has been to remarkably improve our fiscal outlook. Do we track on this? Do you understand what I'm saying? We're having what looked to be, for example, with the debate over the tax bill we were looking at, I don't know, a $5 trillion fiscal cliff, which is very destructive in and of itself because the interest on the debt eats away at your ability to build roads, bridges, defense, education, whatever, right? And you've got to service the debt so interest rates go up, which bleed over into the mortgage market, consumer credit market and all of that. And we've learned based on the tariff revenue flows that that is completely flipped. And you're seeing, actually, you're seeing the bond market across the yield curve actually respond very favorably to that. Yields are going down. And so tariffs are going to, I think, lead this country to a place where we haven't seen since one year of the Clinton administration, which is a balanced budget and a reduction in our debt in effective terms. Just quickly, because we'll go to audience questions in a few minutes. But I wanted to get your thoughts on who will replace Jay Powell as chair. I think there's, it's like the Kentucky Derby now, isn't it? It's like you got 17 horses in the thing racing. It's up to the boss. And he's going to have fun making that choice. But it's, look, what I think we all want, and I'm not talking about inside the administration. I think what we all want in this country is a Federal Reserve chairperson who is able to accurately assess what's a very complex chessboard. If you look at Jay Powell, the first thing is he's a lawyer, not an economist. That was a very bad mistake putting him in there without the credentials. Now, he made three major blunders so far, all related to his inability to understand the macro environment. And as you know, this is kind of what I did before I came in the administration. It's like what Powell did in 2018 is he didn't understand that in Trump world, if you cut taxes, cut regulations, drill baby drill and lower energy prices and reduce your trade deficit through fair trade, that you could grow a lot faster than the budget folks had been predicting, OK? We were in that time. I don't know if you remember this. The new normal. You remember that phrase? The new normal. That was the idea that you could only grow 1% or 2%, not beyond that, without causing inflation. And Powell bit into that hook line and sinker. He failed to understand we could go to 2.5% or 3% without any inflation at all. He raised rates on us too fast. He didn't see it. And then on the other end here, he's doing the same damn thing. It's like he finally said, well, tariffs may not cause inflation and if they have any effect, it'll be a one-time deal, right? So now he kind of backed off. But he kept rates too high. And then in the middle of that, the worst thing he did, in my judgment, was what? He didn't raise them fast enough when any damn fool could see that the yelling Biden crew were feeding us a bunch of malarkey with this transitory stuff. They let inflation get out of control. And then Powell had to go too fast. So what do we want? All we want is a Fed chair that understands macro and is not going to be politicized. And that's how the choice should be made. I can guarantee it won't be Lisa Cook. Does the administration value Fed independence? We value a Fed that understands the chessboard and will do the right thing independent of political considerations. That hasn't been the problem. I mean, it's kind of ironic. I mean, let me talk about my own personal situation. Most of you know I got arrested at Reagan Airport for a misdemeanor, put in handcuffs and leg irons and went to prison for four months, right? And now we're looking today at John Bolton, right? It's like he gets to self-surrender, right? He just waltz into court and then go home on bail and stuff like that. It's like, where's the kind of justice? And if you look at Lisa Cook, right? It's like, what's going on with that? She's on the Fed, but she's seemingly guilty of exactly the same kind of thing. A couple of guys who was in my prison dorm were guilty of it. So we're sitting in there for 10 years. So all we want is fairness, honor, fairness in this world. And so far, we haven't been getting it. It is time to go to audience questions. So at this time, I'd like to invite CFR members both here in D.C. and online to join the conversation. Reminder that this meeting is on the record. Let's go with President Truman first. Wow. This is more of a republic here than a democracy. First of all, thank you, Peter, for being here. And I think it's important for us to hear your perspective, whether we agree with it or not. I just wish you didn't hold back. I think it's fair to say you don't. I'm not going to go through a point-by-point debate. I'm happy to have a conversation with you some other time where we disagree, including over facts that you used. You can fact-check me later. I will do your job for you. I do want to say the comments about the council are a bit of a caricature. The council doesn't actually take positions. We don't advocate positions. We have a wide range of views here. And I would be happy to educate you. I went through all of the council. Let me ask the question, then you can answer it. I went through your publication, which comes out, what, four times a year. I went through all of that. I went through all of your speeches. I went through all of the comments made on CNN, MSNBC. So fact-check me, sir. I'm happy to do that. I'm happy to provide you with a wide range of perspectives that we have here, including about the... I don't need you to do it. All I need is AI. Well, there's also hallucinations. I don't want you to be subject to hallucinations. The facts are the facts, Mike. At any rate, let's focus on your administration and your policies going forward. And just to build on one question that Anna raised about manufacturing and the experience of the first term, second term. In 2018, the Trump administration did impose tariffs on steel and aluminum, 25% tariffs. And we have data, right? Two years later, there were 1,000 more steel workers and 75,000 fewer manufacturing workers in the sectors that were dependent on steel. That's not a Goldman Sachs study. That's a Ball State University study that worked on it. And, you know, I'd be interested in... Let me just, if I could finish. I'm not sure what you're doing here, Mike, because you got, I mean, 4,000 people watching this and you got a lot of people in this room who want to ask questions. You and I can disagree. No, absolutely not. I'd like to hear from everybody else. I would just love to give you an opportunity to talk about how you're seeing tariffs and the current administration's approach to tariffs, which sort of on, off, higher, lower, how you see it being successful in driving more manufacturing and manufacturing jobs to the United States based on the experience of the first term and based on the experience of the last eight months. Sure. The serious part of that question is simply that if you look, for example, in the steel and aluminum industries, we've already seen significant investment commitments. If you look at that one number I spoke about earlier, $19 trillion, that's going to diffuse across many parts of our manufacturing base. At the smaller manufacturing level, which is a lot about the province and my office helping small manufacturers, the letters we get go up to here in terms of thanks for finally being protected from the ravages of unfair competition. And if anybody in this room or anybody watching on Zoom thinks that our small manufacturers in this country aren't on a daily basis being assaulted by foreign competition, which is subsidized, which often steals their intellectual property, which cheats in every way, then come spend a day with me in my office or better yet, we'll get on a plane and go out to Ohio and I'll take you to a factory. Great. Let's take another question from the room. I know there's a lot. Maybe here in the middle of the table. Great. Good morning, and thank you, Dr. Navarro, for your insights. Elise Bassanite, former supply chain executive and CEO of Win Next Gen. You talked extensively about supply chain resilience reducing our reliance on foreign manufacturing. Can you share what role you think public-private partnerships could have, particularly with respect to nonprofits, educational institutions and employers in cultivating the necessary pipelines we need for supply chain, the next generation supply chain workers and talent? Well, look. The government can't do the building to fix the supply chain. The role of government, at least one of them, is to identify the vulnerabilities and figure out whether there's a role for government to play in fixing it. We'll go back on it to the rare earth issue. One of the... I mean, the central feature of the rare earth magnet problem is that every time this country has tried to develop capacity, China has come in and dumped product into the market, put them out, mountain pass, which we have revived, I think, for the third time now. The last time, it revived and was trying to produce rare earth, China just came down and crushed it, absolutely crushed it. So, for example, as the Treasury Secretary Scott Besson said, what we're going to need to do, for example, is to provide some kind of tariff floor to defend our critical industries from strategic dumping. I mean, when China does that, it's not an accident. And it's not simply a mercantilist thing to make money. If you go back and look at their five-year plans, and I wish that CFR had done a better job over the last 25 years doing what I did, which is to read those things, they tell you exactly what they're going to do, right? They tell you that we're going to go in and crush world competition. We're going to get control of all the mines and minerals around the world. And then once we get that position, we're going to use it not only for economic reasons, but for strategic reasons, effectively weaponizing. They tell you this, right? And we don't pay attention. So that would be a case where the government has more of a role than simply just identifying the vulnerability. It's actually taking an action to defend and move forward. That's a good question, ma'am. Thank you. Let's take a question from online. We'll take the next question from Elise Labbott. Ms. Labbott, please unmute yourself. Sorry, I unmuted. Dr. Navarro, thank you very much for your remarks. This was certainly the most lively meeting I've ever attended in person or virtually. My name is Elise Labbott. I'm a foreign policy journalist, and I write a subset called Cosmopolitics. I was wondering if you could expand maybe a little bit on your last answer. On the larger trade and tariff strategy, how targeted are you on strengthening the manufacturing base to those supply chain vulnerabilities and building the base on critical industries and strategic sectors like tech and tying small business manufacturing and upskilling workers to the jobs of the future? Because I understand what you were talking about, but then when I look at the larger tariff strategy, I think are we looking to manufacture everything? And if I could just throw in a quick one on 100 percent tariff on things like the movies, obviously our movie industry is already the best in the world, and I don't understand the competitive issue there. Thank you. Well, let's take the movie thing first. If you know Hollywood, and I used to live about 60 miles from there. It became almost impossible to produce a medium to low budget film in Hollywood, and so it was off to Czechoslovakia and Canada. The industry went, and it was drawn by heavy government subsidies from countries around the world who wanted to cash in on the Hollywood cow. So yeah, that's a significant issue. With respect to your other question, which I think is much more textured and important. So 232, that number is really important. That's section 232 of the Trade Act that allows the Department of Commerce to investigate cases where industries, steel, aluminum, pharmaceuticals, lumber, autos, may be being harmed in a way which threatens national security. And that's the framework that we're using to address a lot of our critical industries which are critical to national defense. So those are industry specific. It's agnostic with respect to the size of the companies that are in the industries. So you have that bucket, and then you have the 301 bucket. That's what the United States Trade Representative used. I think Mr. Froman's successor, Bob Lighthizer, was the first one to actually use that. We used that for China. But generally that can be used for country specific issues where you have countries which are engaged in particularly egregious practices. So you have that. And then the third issue, which is the IEPA one, which is the one that's going to be so critical coming up before the Supreme Court, that's when you have a national emergency situation. And in the case of how that's being applied now, it's being applied within the context of the fentanyl slaughtering what is more than a million Americans so far. That's an emergency. And then the trade deficit, which is over a trillion dollars a year now, and we've cumulatively sent offshore about 19 trillion of our wealth. So I guess to your question, when you think about tariffs, there's a lot of different ways you use them with a lot of different goals. So I'll stop there and let you keep going. I'll go back to someone in the room. Maybe here in the front. Hello,Michael Wessel. Peter,I'm thrilled you're here. I'm thrilled,Michael,that he was invited. While CFR has a patina,shall we say, it's not monolithic. I am a CFR member, and you and I go back probably 20 years on death by China and many other things. I want to ask you a question,though, about China's actions last week on rare earths because I see it as a fundamental mistake in the sense that they have now awoken so many other countries as to the risk and the weaponization of the supply chains that they are willing to exert. They started that,as you know, with Japan in the early 2010. I guess it was 2014. Now last week, they have woken up the world that they are serious about domination and weaponizing supply chains. What are your thoughts on that? One of my jobs at the White House going back to the first term and to this day is to identify vulnerabilities in our defense industrial base and in our supply chains for an economy. I remember back in the first term, I did a report with the Pentagon on vulnerabilities in the defense industrial base that was the first one that had been done in like 30 years. So my job literally every day is to worry about whether we have enough magnets or pharmaceuticals or ball bearings or whatever it is that we need. It's the famous saying, for want of a nail, the war was lost. You go through the horseshoe and this and the other thing. The one takeaway, Mr. Wessel, from what China is doing now is that my job is a lot easier because I don't have to convince anybody anymore like I did in the first term, either inside the White House or in the press or in think tanks that the problem of China potentially weaponizing their supply chain, manufacturing base as well as their consumer demand is something that they have put on the table. And what's extraordinary to me is that it's not just in this magnet issue, it's not just us, it's the whole world. And whether it's Delhi or Tokyo or Ho Chi Minh City, people are going, oh, oh, oh. And things are changing. So that's kind of the state of play of that. I mean, we'll see what happens. We hope for peace. Hope's not a strategy, but I can tell you that the world has fundamentally changed based on what we've observed. And the world will not go back to sleep on this. You mentioned several measures and to respond to that. Is one possibility 232 tariffs on critical minerals? Would those be coming soon? There's an investigation underway. And so you'll be working on a story at some point. OK. We are the full employment act for any trade reporter at the New York Times or anywhere else. Thank you so much for the debate. Raul Gallegos from Morgan Stanley. I was wondering if you could expand on... I like you guys better than Goldman Sachs as a rule. I'll take that. Thank you very much. And I do like the three-minute podcast you guys put out. My question to you is regarding USMCA and what the plans are. And the way I would like to frame the question is based on your comments earlier that Wall Street and some corporate interests are not exactly aligned with what the administration is doing. My question to you is what in the plans you have for USMCA will those folks see as positives and as negatives, if you will? Not my plan. I'm going to let Jameson Greer and the boss handle that one. It'll be obviously a very serious wide-ranging negotiation. One of the big concerns that I have and I've expressed is the use of Mexico as a staging area for other countries to essentially evade terrorists and leverage the USMCA terrorists. So that's going to be at least one of many issues we've been talking about. Does the administration want to keep USMCA? Yeah. See, Anna always wants me to make news. And so my challenge is to never make news. I just like once the news is made, then I can comment on it. Just so people understand my role. There's sort of a reason I stuck around for four years. Longer than four years, right? Longer than four years now, yes. Let's take another question online, please. We'll take the next question from... Looks like they dropped. So we'll take the next question from Sarah Williamson. Hi, Dr. Navarro. Thank you very much. This is Sarah Williamson, the CEO of FCLT Global. And I think we'd all probably agree that innovation has been the driver of economic growth in this country for many decades. And the administration is now cutting and redirecting funding for scientific research, which has been the catalyst for this innovation. And there's also in some cases dissuading scientists from coming to the United States. And meanwhile, China is investing heavily in innovation. So how does this align with the goals of driving the U.S. economy forward? Look, I'll be honest. When I hear that, it just sounds like an op-ed from industry. I mean, I get it. But there's much bigger issues involved in the way universities over the last decades have used and sometimes abused government funding. And that all needs to be sorted out as if former academic for 25 years at the University of California, now Professor Emeritus. I can tell you that our universities and college systems are in deep, deep trouble. They need the same kind of restructuring our trade system has undergone. They've essentially lost their way. They have no idea how to employ the people that they take tuition from. And so I think that all needs to be thought through. But again, that's not my lane. And it's been a real great pleasure to be with you today. I hope you will take my opening remarks in particular to heart. I would just ask you this question in my closing here. It's like, why did it take some obscure academic from Laguna Beach, California beginning back in 2006 to write three books about China, two on the economy, one about their military buildup that were widely panned as hyperbolic at the time, but now read exactly, exactly like a Pentagon report? Why wasn't somebody out there doing that instead of somebody at the Council on Foreign Relations? And I think that you all need to think about what we talked about today and maybe step back and assess rather than knee-jerk defend what has been the status quo that President Trump is now turning on its end. Just kind of think through what's going on here. If you just give me that, I'd appreciate it. Thank you. Unfortunately, we're out of time. Dr. Navarro has a hard time. I've got to scoot. Thank you so much for joining today's meeting. Thank you.