Donald Trump on Free Trade
2016 Republican nominee for President; 2000 Reform Primary Challenger for President
TRUMP: Because I did disagree with Ronald Reagan very strongly on trade. I disagreed with him. We should have been much tougher on trade even then. I've been waiting for years. Nobody does it right.
CLINTON: This is the way Donald thinks about himself, puts himself into the middle and says, "I alone can fix it," as he said on the convention stage.
TRUMP: Yeah, we've heard this before, Hillary. And frankly, now we're going to do it right.
Ford is moving production of the Ford Focus and Ford C-Max from its Michigan Assembly Plant in Wayne to Mexico in 2018. Ford said in April it plans to invest $1.6 billion to build a new plant in Mexico and create 2,800 jobs to build small cars there. However, Ford also plans to replace the products it makes in Wayne with two new vehicles and has repeatedly said no jobs will be lost. Ford's CEO said that "zero" jobs will be lost in the US and said "it is really unfortunate when politics get in the way of the facts."
Trumps' comments also prompted tweets from both Ford and the UAW countering Trump's claims. The automaker also made a commitment in November to invest $9 billion in U.S. plants and creates or retains more than 8,500 jobs as part of a new four-year contract with the UAW.
Bloomberg Fact check: NAFTA had a modest effect on manufacturing jobs. An Economic Policy Institute analysis says manufacturing jobs dropped in the 1990s from 17.9 million to 17.6 million.
Trump said of Hillary, "She's been doing this for 30 years. And why hasn't she made the agreements better? The NAFTA agreement is defective," [implying that Hillary and Bill Clinton held primary responsibility for NAFTA]. Chicago Tribune fact-checkers noted that while NAFTA was signed by former U.S. President Bill Clinton, it was largely negotiated under the administration of George H.W. Bush.
When a company in Germany makes goods to sell at home, it has to pay the VAT. But if it makes them to sell in the US, it doesn't--the tax gets waived at the border. If a US company sells in Germany, it does have to pay the VAT. [The UC Irvine] interpretation is that] border adjustability turns the VAT into an "implicit export subsidy" for foreign companies and an "implicit tariff" on US exporters. This is just dead wrong. Everybody has to pay Germany's VAT when they're selling goods in Germany. Nobody has to pay Germany's VAT when they're selling goods outside of Germany.
You can't really blame Trump for this one: a guy with a PhD in economics fed this stuff to him.
We have to renegotiate our trade deals. They're taking our jobs, they're giving incentives, they're doing things that, frankly, we don't do. Let me give you the example of Mexico. They have a VAT tax. We're on a different system. When we sell into Mexico, there's a tax. When they sell in--automatic, 16 percent, approximately. When they sell into us, there's no tax. It's a defective agreement. It's been defective for a long time, many years, but the politicians haven't done anything about it. But in all fairness to Secretary Clinton, when she started talking about this, it was really very recently. She's been doing this for 30 years. And why hasn't she made the agreements better? The NAFTA agreement is defective. We owe $20 trillion. We cannot do it any longer.
TRUMP: We have a trade deficit with Mexico of $58 billion a year. We're going to make them pay for that wall. The wall is $10 billion to $12 billion. I don't mind trade wars when we're losing $58 billion a year. Mexico is taking our businesses. They de-value their currencies to such an extent that our businesses cannot compete with them, our workers lose their jobs. You wouldn't know anything about it because you're a lousy businessman.
TRUMP: I am all for free trade, but it's got to be fair. When Ford moves their massive plants to Mexico, we get nothing. I want them to stay in Michigan.
Q: But the American Enterprise Institute says, your Trump Collection clothing line, some of it is made in Mexico and China.
TRUMP: That's true. I want it to be made here.
Q: The point is you're doing just what Ford is--you're taking advantage of a global trading market.
TRUMP: I never dispute that. I just ordered 4,000 television sets from South Korea. I don't want to order them from South Korea. I don't think anybody makes television sets in the United States anymore. I talk about it all the time.˙We don't make anything anymore. Now you look at Boeing.˙Boeing's going over to China.˙They're going to build a massive plant because China's demanding it in order to order airplanes from Boeing.
A: I think NAFTA has been a disaster. I think our current deals are a disaster. I'm a free trader. The problem with free trade is, you need smart people representing you. We have the greatest negotiators in the world, but we don't use them. We use political hacks and diplomats. We use the wrong people. Mexico is smart; they have out-negotiated us to a fare-thee-well. They're going to be the capital of automobiles pretty soon, the way they're going.
And you say to yourself, "How does that help us? Where is that good"? It's not. So I would say, "Let me give you the bad news. Every car and every part manufactured in this plant that comes across the border, we're going to charge you a 35% tax, and that tax is going to be paid simultaneously with the transaction.
Now, if it's not me in the position, here's what's going to happen: They're going to get a call from the donors or from the lobbyist for Ford and say, "I take care of you, and you can't do that to Ford."
I'm using my own money. I'm not using the lobbyists. I'm not using donors. I don't care.
Free trade can be wonderful if you have smart people, but we have people that are stupid. We have people that are controlled by special interests. And it's just not going to work
Government needs to stop pick-pocketing your wallet. Every time it does, it slows growth and kills jobs. It's also immoral.
Why is our president signing the trade bill that the South Koreans want him to sign instead of the one that gives us maximum advantage?
Clinton: Well, that is just not accurate. I was against it once it was finally negotiated and the terms were laid out.
TRUMP: Energy is under siege by the Obama administration. The EPA, Environmental Protection Agency, is killing these energy companies. And you take a look at what's happening to steel and the cost of steel and China dumping vast amounts of steel all over the United States, which essentially is killing our steelworkers and our steel companies. It's an absolute disgrace.
CLINTON: First of all, China is illegally dumping steel in the United States and Donald Trump is buying it to build his buildings, putting steelworkers and American steel plants out of business. That's something that I fought against as a senator and that I would have a trade prosecutor to make sure that we don't get taken advantage of by China on steel or anything else.
KASICH: Trade has to be balanced & we have to make sure that when we see a violation, like some country dumping their products into this country, I will shut down those imports.
Q [to Trump]: Your campaign platform is inconsistent with how you run your businesses: your companies manufacture clothing in China and Mexico.
TRUMP: Because of the monetary devaluations that other countries are constantly doing and brilliantly doing against us, it's very, very hard for our companies in this country, in our country, to compete. So I will take advantage of it; they're the laws. But I'm the one that knows how to change it. Nobody else on this dais knows how to change it like I do, believe me.
KASICH: They can't manipulate their currency. That will not be anything that I would allow them to get away with. And if I saw them doing it, I would take immediate action and make sure that the American worker is protected.
TRUMP: The 45% tariff is a threat. It was not a tax, it was a threat. It will be a tax if they don't behave. Take China as an example. I have many friends, great manufacturers, they want to go into China. They can't. China won't let them. We talk about free trade. It's not tree free trade; it's stupid trade. China dumps everything that they have over here. No tax, no anything. We can't get into China. The best manufacturers, when they get in, they have to pay a tremendous tax. The 45% is a threat that if they don't behave, we will tax you. It doesn't have to be 45, it could be less. But it has to be something because our country and our trade and our deals and most importantly our jobs are going to hell.?
TRUMP: The 45% tariff is a threat. It's not a tax, it was a threat. It will be a tax if they don't behave. Take China as an example. I have many friends, great manufacturers, they want to go into China. They can't. China won't let them. We talk about free trade. It's not tree free trade; it's stupid trade. China dumps everything that they have over here. No tax, no anything. We can't get into China. The best manufacturers, when they get in, they have to pay a tremendous tax. The 45% is a threat that if they don't behave, we will tax you. It doesn't have to be 45, it could be less. But it has to be something because our country & our trade & our deals and most importantly our jobs are going to hell.??
Q: Will you promise that you will move your clothing collection to the US, the clothes that are made in China and Mexico?
TRUMP: I will do that. And by the way, I have been doing it more and more. But they devalue their currencies, in particular China. Mexico is doing a big number now, also. Japan is unbelievable what they're doing. They devalue their currencies, and they make it impossible for clothing-makers in this country to do clothing in this country. The Trans-Pacific Partnership--which Marco is in favor of---they don't take into concurrence the devaluation. They're devaluing their currency.
RUBIO: The answer is, he's not going to do it. And you know why? The reason why he makes it in China or Mexico is because he can make more money on it.
TRUMP: The TPP is horrible deal. It is a deal that is going to lead to nothing but trouble. It's a deal that was designed for China to come in, as they always do, through the back door and totally take advantage of everyone. It's 5,600 pages long, so complex that nobody's read it. This is one of the worst trade deals. And I would, yes, rather not have it. We're losing now over $500 billion in terms of imbalance with China, $75 billion a year imbalance with Japan.
Q: Which are there particular parts of the deal that you think were badly negotiated?
TRUMP: Well, the currency manipulation they don't discuss in the agreement, which is a disaster. If you look at the way China in particular takes advantage of the US--it's through currency manipulation. It's not even discussed in the almost 6,000-page agreement.
Sen. Rand PAUL: Hey, you know, we might want to point out China is not part of this deal.
I know from my own experience that this is a difficult problem. The Chinese are very savvy businesspeople, and they have great advantages over our manufacturers. I've had several Trump-brand products made there.
Remember: The Chinese need us as much as we need them. Maybe even more.
We can't do anything right. Our military has to be strengthened. Our vets have to be taken care of. We have to end ObamaCare, and we have to make our country great again, and I will do that.
When did we beat Japan at anything? They send their cars over by the millions, and what do we do? When was the last time you saw a Chevrolet in Tokyo? It doesn't exist, folks. They beat us all the time.
When do we beat Mexico at the border? They're laughing at us, at our stupidity. And now they are beating us economically. They are not our friend, believe me. But they're killing us economically. The U.S. has become a dumping ground for everybody else's problems.
Onshoring has huge potential. That's why Congress need to pass Virginia Congressman Frank Wolf's bill called the "Bring Jobs Back to America Act" (H.R.516) to help expand the onshoring movement and get American jobs back where they belong--here in America.
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