Peter Navarro Talks Upcoming US, China Trade Talks

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We begin this hour with markets are looking ahead to high stakes trade talks between the US and China and Switzerland this weekend. Joining us now. Very pleased to say Pin Navarro, the Director of the Office of Trade and Manufacturing Policy at the White House, dot Donavaro, it's been too long, sir. It's good to see you. Thanks for being here.

Been a long time.

Joan, it is good to see you too, sir. Thank you, sir, first class digs here, my friend.

Well, I'm pleased we're looking after you. Let's kick it off with these talks this weekend. We just heard from the President just moments ago and he mentioned an eighty percent tariff might be about right. It's up to the

I was one of three people that was with the White House the first term for all years. One of the big reasons is I never got ahead of the president. Let me tell you about Geneva, which is kind of I've got a very warm memories. It was my finest hour as a negotiator. I went there to lead the negotiations for the United Postal Union reforms that essentially got China rates fair to we say billions on that. But I mentioned this because Geneva has symbolic value in this negotiation.

Of the World Trade Organization.

And the scariest thing I ever saw in Geneva was the size of the China delegation at the World Trade Organization. And they've played the WTO like a fiddle.

So let's see what happens tomorrow.

I'd be happy to come back on Monday do the debrief, but I don't want to get ahead of the Boss or Scott Besting. And don't forget Scott's going with Jamison Greer, the United States Trade Representative. He's the guy who learned that the knee of Bob liteheis for the first time around, was there for all the China stuff, and he's the guy who was the architect, along with Howard Lutnik, of the UK deal.

So let's see what happens. It'so of the very best.

We'll certainly pensil in the weekend for the markets. Well, pensil in and appearance with you for Monday. No worries about that. I'm looking forward to that conversation. Just got into the weekend and reflected on your experience dealing with the Chinese. Then not the UK. This is not the same relationship. The trade relationship is tremendously unbalanced and has

Well, I could tell you.

I think I sat face to face with the China team maybe seven times during the first term, and twice Shi Jinping was there with G seven, just community the G twenty both. I think it was Tokyo and our Buenos Aires. What's interesting, So what's so interesting to me, Jonathan about China is that they have continuity. The same people are going to be in Geneva or the same people back then, and you know, our our regimes change,

But look, it'll be interesting again.

I don't I don't want to get ahead of Scott and Jamison or the President.

I think, let's see what happens.

You know, my role, and we've got we've got fifteen countries we run enormous trade deficits with that, We've got to renegotiate.

The whole structure of those deals.

And there's another one hundred countries that that cheat us in some ways.

But smaller ways. My role in the administration.

On all of this is to do the background analytics to see how we country is cheating us, which basically sets up the terms of the negotiation. And every country, like fingerprinsts, like India is the Maharaja tariffs. They have the highest tariffs of any of our major trading partners. Japan is the most clever at protecting its own markets with a combination of domestic protectionism non tariff barriers. You know,

So what I do is.

Do the background and look at kind of how these countries are doing what to us, and we get great deals from there.

People. I think the UK deal is very interesting.

I think the significance is not just that it's a deal, but that's a template for the future deals. What we do done is like four or five verticals we look at. It's the tariffs, the non tariff barriers, the digital taxes, and then the various kinds of cheating, the dumping, the currency manipulation and things like that. And then from there we assess what the asks are, what we need and go forward from there.

See, you get to see a steady wave of deals.

The USTR building is right across the street from the White House. It's got the most staff negotiating these deals. And it's like you go to the Delhi and you have to take.

A number and get in line.

Every day there's delegations from around the world lining up to meet with Jamison Greer and Howard Lutnick, and I've seen.

I looked yesterday at the schedule.

It was kind of fun out the July and it's just you know, one after the others.

Well, Peter looking at the countries lining up.

One key aspect of the UK deal was of course bringing down the auto tariff to ten percent. So right now tariff rate that's lower for Bentley's, which is a car that most American families can't afford made in the UK, where Chevys have a higher rate if they're made in Canada or Mexico. Is there an expectation that the next trade deals auto terrors will be coming down those rates.

It's going to be country by country. I mean, the beauty about the UK is.

That very small amount of exports they send us and we have a hard cap I think it's one hundred thousand units where it goes right back up to twenty five percent. And again we're trying to do something that's mutually beneficial to both countries to get to a better place.

Well at the same time.

Changing the level of the playing field so that it is more level. I think for me, the beauty of the UK deal besides that was all of the good stuff we had for AG. I mean, one of the problems we have is this non tariff barriers like FIDO sanitary standards, what's that that's like? These things they do to keep our pork out, our chicken out, our beef.

Right now we're going to be able to.

Sell a lot more beef, poultry, dairy, and ethanol.

I mean they had a really.

High tariff, like almost a lockout tariff on ethanol and that's made from corn.

So the folks in Iowa are very happy about that. So this is the way we're going to go forward on net. The United States is going to be far better off. And all we're doing is trying to level the playing field.

I saw the e EU kind of rattling sabers I think was yesterday about some kind of retaliation, and I would just say to anybody's who's in the European Union, I mean, how can you look at us in the face and threaten us when your tariffs are higher?

You have lost.

Cases repeatedly at the WTO on us selling you things like beef and poultry, and you won't even honor that.

So yesterday the President called Ursula Vonderline fantastic and he said he hopes to meet her. But are you saying that the European Union is not as high on the priority list? And say other trading partners like the Oriental pan not at all.

I mean the EU to be clear here, we.

Have the second highest trade deficit with the EU, behind China, so they're very high on the list. All I'm saying here is that I thought I found it unfortunate that the EU kind of fired I think some term was fired shots across our bow. It's like retaliation will not work against the United States.

We shouldn't have that.

Let's talk, let's figure this out, and it would.

Be nice here. Let's give piece a chance here.

All we're asking for here in the United States of America is fairness.

I mean, hold on, did you agree?

Is there any disagreement on this set and on your set that the tariffs of the EU are higher, and that the non tariff bearriers are higher, and that the w t O in Geneva is basically sanctioning that through tuesdays one is the.

But would you agree with that?

I think there's a bigger question fac there. There's a bigger question here. There's a bigger question here, and this is something that the German Finance Minister has come out and talked about, which is they'd be willing to drop all tariffs to zero if the US were willing to drop all tariffs to zero. There is a willingness to negotiate aground the board to a lower teriff regime. Would that be acceptable to you? Or is ten percent?

So stay with that. See, that's such a misdirection.

Okay, it's it's the non tariff barriers stupid to kind of paraphrase Bill Clinton, It's like, it's the non tariff barriers. So when countries like Vietnam or entities like the EU say to oh, let's all go to zero tariffs and everything will be okay, that's.

Not the problem. It's part of the problem.

But the bigger problem is the non tariff barriers in Europe.

It's the VAT tax.

I mean, I don't know if you know this, but the United States has tried, going back to the nineteen seventies to get equity treatment for the that tax, which most countries of the world use versus the income tax which we use. We haven't been able to get it because the WTO has a majority of people who benefit from sticking it to the United States.

So they do.

So the zero tariff thing, that's misdirection, and on your set, you should call it on that. Let's lower the bad tariff barriers, and let's give you relief on the VAT tax.

Now we're talking.

The VAT tax is a slightly different mechanism. This is all going to take a long time, and there are a lot of competing factors here in terms of who can possibly pull these levers. I just wander, We've got two months left in this ninety day negotiating period that is paused for the retaliatory tariffs. Does that just get extended out in another ninety days as you have to deal with different legislative bodies to possibly remedy what you.

See, Well, we don't have to deal with legislative body. Well okay in the EU perhaps, but you know, like coin a term in Trump time, which is to say, do it as fast as possible without screwing it up.

And that's all we're trying to do.

I go back to the observation that the United States Trade Representative and that building, which is historic building, by the way, beautiful to see if you ever get there. The lines, you know, they're they're coming in and out. We're talking, and we're talking, and you.

Know, let's, as the boss says, let's see what happens.

I mean, it's in everybody's interests around the world to level the playing field with the United States in a way which allows us to restructure this international trade environment which is fundamentally skewed against the United States. I mean, we're losing because of this system. The United States is losing our manufacturing base, We're losing our defense industrial base.

And when push comes to.

Shove and folks around the world are looking for the United States to help defend them, I mean, we get to a point where we can't do that, what good is that?

So trade?

Trade, economic security is national security is one of the guiding principles and President Trump in this administration. So we're just trying to get fairness here. Give give fairness a chance here and work with us.

Looking forward to an update on Monday, sir, it's going to see it once again, sir. Thank you. Dotar, Director of the Office of Trade and Manufacturing Policy at the White House.