Hannity: “Look at Ford. Ford now has made a decision. They’re going to relocate jobs to Michigan. They cancelled a Mexico plant, and you know, one announcement after another.
“With the business incentives, corporate incentives and new tax policies and the end of a lot of burdensome regulation, companies now seem incentivized to want to stay here.”
Buchanan: “I think they do, and the anecdotal evidence: Carrier, Ford and these others, where Trump has sort of intervened personally and been successful, I think are excellent.
“But in the longer run, and I think the President-elect realizes this, Sean, in order to get rid of a $500 billion trade deficit, you’re going to have to raise the price of imports coming into the country and reduce the price of goods made and produced in the United States here.
“And I think he’s going to have a program. He’s got a couple of folks in there that understand this. And I think if he works with the Hill, he’s going to have some resistance with the free traders up there, but I think it can be done. But this is a process, really, of years, Sean, and not just anecdotes, although these anecdotes are certainly welcome.”
Hannity: “Well, listen. I’ve got to tell you; I don’t even think a trade war is ever going to happen.
“One thing I’ve learned about interviewing Donald Trump over the many years, everything he says and does is far more calculated than I think people give him credit for, and I think everything is a negotiation.
“And the fact that a president of the United States is calling particular companies – I’ll use Carrier as one example, Ford as another example – and saying this is what the business climate is going to be like. ‘You have an open door to me if there are burdensome regulations that are hurting your business and job creation.’ I mean, I just think that goes a long way to incentivizing companies to stay here. And as it relates to other countries, if they want to put up trade obstacles to the United States, like a 40 percent excise tax or a 40 percent tax on American goods, well, I think those deals are going to be renegotiated fairly quickly or these countries are going to realize they’re going to be hurt themselves because of their own actions.”
Buchanan: “Well, let me disagree here a bit. I think a trade war has been waged against the United States, and we have not fought it. And that’s the reason why we lost 55,000 factories in the first decade of this century and 6 million manufacturing jobs. That’s why we’ve run a $12 trillion in trade deficits in the last 25 years, $4 trillion of that with communist China.
“It’s why places like Detroit and Baltimore and inner cities in America look like what they do, whereas we’ve seen China, a backwards place when I was there with Nixon in ’72, suddenly become the greatest manufacturing power on earth from a totally backwards state.
“We’ve had our clocks cleaned for decades. It’s because of the free trade ideology, which has got both parties in its grip, and presidents of both parties have pursued. And I think Donald Trump recognizes this.
“But what I’m saying is, if we’re going to undo the consequences of the trade wars conducted against us, while we played neutrals and were run over, it’s going to take policies besides Trumps getting folks on the phone.”
Hannity: “Well, I think I totally agree with you, but I also think that the threat is real. I mean, if you read “The Art of the Deal,” which I’ve suggested, if you want to get into the mind of Donald Trump negotiating, his attitude is you walk away from any deal up to the last second before you sign it.
“And I think he’s not going to negotiate a trade deal that is one-sided with – I don’t care if it’s renegotiating NAFTA, which the Mexican president said he’s open and willing to do or if it’s a trade deal with Japan or a trade deal with China. I think it’s going to be beneficial to both sides. Free and fair trade seems to be what he is saying and communicating. And then it becomes an issue for these other countries, if they’re willing to work in an environment where things are fair for everybody.”
Buchanan: “Well, here’s my view. I’m a Hamiltonian. He believed that trade was a means to an end. It’s not an end in itself, and he said a U.S. trade policy should concern itself with making America sovereign and independent in its defense, in its weaponry, in its habitation, in its [ability] to feed and clothe itself – in other words, to make America the totally independent country we were, Sean, at the beginning of World War I and the beginning of World War II, where the United States could say, ‘Look, we might not want to get in this war at all, and we’ve got no problem staying out completely because we’re not dependent on anyone for anything.’
“That’s what you want, economic independence to support your political independence, and the idea that this is like we’re trading down at the mall, I think loses the concept of what international trade is all about, as opposed to trade with me going down to McLean Hardware Store.”
Hannity: “No, I’m not talking about that. What I’m saying is, trade can be beneficial to many people. In other words, American companies can have access to other global markets if, in fact, it’s free and fair.”
Hannity: “If it’s not going to be free and fair, I think Donald Trump has been pretty clear what that would mean for those individual countries. My guess is that these countries are highly dependent on having access to our markets, and the adjustments will be made to make it fair.”
Buchanan: “Well they’ve got to have access to our market. It’s a, what is it, $17-$18 trillion market – the greatest market on earth. If your auto companies don’t have access to the American market, they almost cannot be world-class auto companies.
“But there is a difference here. Exports of produced goods manufactured in the United States add to the Gross National Product of the United States, and imports of produced goods detract, diminish, subtract from the Gross National Product of the United States.
“Now, let’s take a Lexus car, which is a fine automobile. If you buy a Lexus car, straight say, all its parts coming off the boat in San Diego or wherever that is an enormous gain for Japan. But if you put a tariff, say, of 20 percent and the Japanese decide, ‘Hey look, that will force the price of our Lexus beyond a Cadillac and lose sales.’ If they then move their factory to the United States of America, Amen brother, I’m all with you.”
Hannity: “I’m with you too. I mean, I thought this was pretty interesting. The $700 million investment that the Ford Motor Company was going to make with Mexico and build their plant down there, well now they’re building it here in America.”
Buchanan: “They are. But let me tell you why they’d make that decision.
“A lot of these guys, it’s not that they’re anti-patriotic. If you’re sitting up there and you’re an executive and you say, ‘Look, Ford or the Cadillac company, or General Motors, is making its cars down in Mexico. It’s paying the guys six bucks an hour down there. It doesn’t have the pension problems, doesn’t have the Social Security. They can make them cheaper down there, and if we want to compete, we’re going to have to build them down there more cheaply and then bring them into the United States free of charge and sell them here.’
“It makes economic sense to move your production to Asia and Mexico, just like it did to move it out of New York and Connecticut down to the Sun Belt when those folks weren’t making as much money down there per capita as they’re making in the north. So you’ve got to adjust the incentives for production so that people who make decisions will say, ‘We got to produce inside the United States.”