SAY WHAT GEORGE W. BUSH COULD SAY IN A MOMENT OF CRISIS IN THE
AMERICAN ECONOMY.
AMERICAN ECONOMY. "THIS SUCKER COULD GO DOWN."
LEADING OFF OUR DISCUSSION
TONIGHT, GENE SPERLING, FORMER
DIRECTOR OF THE NATIONAL
ECONOMIC COUNCIL FOR PRESIDENTS
OBAMA AND CLINTON.
HE IS WHO I PRAY TO WHEN I AM
LOOKING FOR A SOLUTION TO
AMERICAN ECONOMIC ISSUES.
AND RON KLAIN, FORMER SENIOR
AIDE TO VICE PRESIDENT JOE BIDEN
AND PRESIDENT OBAMA.
HE’S AN ADVISER OF JOE BIDEN’S
2020 PRESIDENTIAL CAMPAIGN NOW.
GENE, YOU HAVE THE FLOOR.
I DIDN’T ANTICIPATE TALKING
ABOUT INVERTED YIELD CURVES THIS
WEEK, BUT HERE WE ARE.
>> YES.
>> YES. WELL, I THINK WHAT WE’RE SEEING,
LAWRENCE, IS THAT OUR BIGGEST
FEAR WITH GEORGE -- WITH
PRESIDENT TRUMP ISN’T JUST
ECONOMIC NATIONALISM.
ECONOMIC NATIONALISM. IT IS ECONOMIC NARCISSISM.
IT IS THIS KIND OF DRUNK DRIVING
TYPE OF ECONOMIC MANAGEMENT.
NOW, WHEN YOU DRIVE DRUNK, YOU
DON’T ALWAYS GET INTO AN
ACCIDENT, BUT YOU DRAMATICALLY
INCREASE THE CHANCES OF
SOMETHING VERY BAD HAPPENING.
DONALD TRUMP INHERITED, LIKE HE
INHERITED WEALTH FROM HIS DAD,
HE INHERITED AN ECONOMY THAT WAS
SOLID, THAT WAS IMPROVING, AND
WHAT WE SAW FIRST WAS A HUGE TAX
CUT WHICH WE NOW SEE WAS REALLY
BASED ON ONE THING THAT IT WAS
GOING TO JUSTIFY THIS HUGE
INCREASE IN THE DEFICIT BECAUSE
IT WAS GOING TO HAVE A LASTING
EFFECT ON BUSINESS INVESTMENT.
WE’VE ALREADY SEEN FROM JAY
POWELL, TO THE SECOND-QUARTER
RESULTS, THAT BUSINESS
INVESTMENT IS SLOWING.
IF YOU TAKE OUT OIL AND MINING,
IT’S ACTUALLY BEEN SLOWER THAN
IT WAS IN THE OBAMA SECOND TERM.
BUT WHAT WE’VE ALSO SEEN IS THIS
RECKLESS TYPE OF MANAGEMENT ON
THE TRADE SIDE.
AND THIS IS SOMETHING WHERE
THERE COULD HAVE BEEN A SMART
WAY TO DO IT.
I AGREE, WE SHOULD BE TOUGHER ON
CHINA.
CHINA. I AGREE, WE SHOULD TAKE SOME
SHORT-TERM HITS BUT THIS KIND OF
RECKLESS BACK AND FORTH HAS NOW
BEEN SUCH AN ASSAULT TO NOT JUST
THE U.S. ECONOMY BUT THE GLOBAL
ECONOMY THAT NOW THE NUMBER ONE
SINGLE RISK FACTOR IN ECONOMICS
IN THE WORLD IS DRUPONALD TRUMP
PERSONALLY.
PERSONALLY. THAT’S WHEY I SAY ECONOMIC
NARCISSISM BECAUSE IT IS HIS
SENSE OF RECKLESSNESS AND HIS
SENSE THAT SOMEHOW MAYBE IF HE
REALLY HURTS THE CHINA ECONOMY
OR THE GERMAN ECONOMY OR THE
GLOBAL MANUFACTURING GOES DOWN
THAT THAT’S SOMEHOW GOOD FOR US.
IT’S NOT.
IT’S NOT. WHEN DEMAND GOES DOWN AROUND THE
WORLD, IT HURTS OUR FARMERS.
IT HURTS OUR STEELMAKERS.
IT HURTS OUR AUTO PRODUCERS.
IT HURTS OUR ECONOMY.
SO THE RISK THAT EXISTS RIGHT
NOW IN THE ECONOMY LIES -- IN
THE GLOBAL ECONOMY AND THE U.S.
ECONOMY -- LIES SQUARELY,
SCARILY ON DONALD TRUMP’S
RECKLESS DRUNK DRIVING APPROACH
TO ECONOMIC MANAGEMENT.
>> RON KLAIN, WE HAVE THE FAMOUS
WORDS OF DONALD TRUMP, THE TRADE
WARS ARE EASY TO WIN.
NO ONE BEFORE DONALD TRUMP HAS
THOUGHT THAT.
THOUGHT THAT. CERTAINLY NOT IN THE ERA OF
MODERN ECONOMIC THOUGHT.
>> YEAH, I MEAN, ECONOMIC POLICY
BASED ON RETWEETS, WHAT COULD
POSSIBLY GO WRONG?
>> YEAH.
>> YEAH. >> LOOK, I ALSO THINK, LAWRENCE,
IT’S WORTH REPEATING SOMETHING
YOU MENTIONED BEFORE ABOUT THE
HOLLOW WHITE HOUSE STAFF.
I WORKED FOR TWO BRILLIANT
PRESIDENTS.
PRESIDENTS. BILL CLINTON AND BARACK OBAMA.
AS BRILLIANT AS THEY WERE, THEY
HAVE, LIKE, A BILLION I.Q.
POINTS ON DONALD TRUMP, THERE
WASN’T A SINGLE MEETING WHERE
THEIR THOUGHTS ON THE ECONOMY
WAS IMPROVED BY HAVING A
FIRST-CLASS TEAM AROUND THEM OF
PEOPLE LIKE GENE SPERLING.
NOW YOU HAVE A PRESIDENT WHO’S
NOWHERE NEAR BARACK OBAMA AND
BILL CLINTON TRYING TO MANAGE AN
ECONOMIC SITUATION WITH A TEAM
THAT’S NOWHERE NEAR THE TEAM
THOSE TWO PRESIDENTS HAD AND
THAT IS A FRIGHTENING
COMBINATION.
COMBINATION. NOW, TRUMP HAS MADE HIS WHOLE
ECONOMY ABOUT THE STOCK MARKET
WHICH I THINK IS A MISTAKE FOR
ANY PRESIDENT.
ANY PRESIDENT. SINCE HE’S BEEN PRESIDENT, HE
TWEETED 72 TIMES BRAGGING ABOUT
THE STOCK MARKET RESULTS.
SEVEN TIMES IN THE PAST FOUR
WEEKS.
WEEKS. AND YOU KNOW WHAT GOES UP DOES
GO DOWN.
GO DOWN. WITH HIS RECKLESS APPROACH TO
TRADE AND OTHER ECONOMIC ISSUES,
THE TAX CUT THAT WAS SQUANDERED
THE WAY IT WAS, WE GOT A BIG
MESS ON OUR HANDS AND THERE’S NO
ONE IN THE WHITE HOUSE WHO CAN
HANDLE THAT.
HANDLE THAT. >> SO, GENE, WE’VE ALREADY SEEN
ONE QUARTER OF NEGATIVE ECONOMIC
GROWTH IN GERMANY.
IF THE NEXT QUARTER IS NEGATIVE,
THAT’S OFFICIALLY A RECESSION
THERE.
THERE. YOU WERE JUST ON THIS POINT, AND
THIS IS SOMETHING THAT DONALD
TRUMP DOESN’T UNDERSTAND, THAT
GERMANY IS A CUSTOMER OF THE
UNITED STATES, A MAJOR AND
IMPORTANT CUSTOMER OF THE UNITED
STATES.
STATES. IF THEIR BUYING POWER DROPS, IF
THEY’RE LESS ABLE TO PURCHASE
WHAT WE HAVE TO SELL THEM,
THAT’S A PROBLEM FOR US.
THEY ARE INTERCONNECTED TO US IN
VARIOUS SUPPLY CHAINS IN
MANUFACTURING.
MANUFACTURING. PARTS OF A MANUFACTURING PROCESS
MIGHT GO FROM GERMANY TO THE
UNITED STATES, THAT’S ALL
AFFECTED BY THIS AND DONALD
TRUMP HAS ALWAYS THOUGHT IN HIS
TRADE WAR HE CAN THROW PUNCHES
AT OTHER COUNTRIES AND WHEN HE’S
THROWING THE PUNCH, HE’S NEVER
GOING TO HURT HIS KNUCKLES IN
THE PROCESS AND IT TURNS OUT IN
TRADE WARS, IT IS IMPOSSIBLE TO
THROW THESE KINDS OF PUNCHES
WITHOUT DOING DAMAGE TO YOUR OWN
ECONOMY.
ECONOMY. >> NO, I MEAN, THAT’S EXACTLY
RIGHT, LAWRENCE.
RIGHT, LAWRENCE. I MEAN, REALLY, IT’S BOTH WAYS,
RIGHT?
RIGHT? FIRST YOU END UP HAVING
SELF-INFLICTED WOUNDS.
SELF-INFLICTED WOUNDS. HOW’S IT GOING FOR AGRICULTURE
EX
EX EXPORTS OF THE UNITED STATES?
SOYBEAN EXPORTERS.
SOYBEAN EXPORTERS. IT’S BEEN A DISASTER.
WE NOW HAVE INDUSTRIAL
PRODUCTION, AND MANUFACTURING,
HIS BIG FOCUS, IS DOWN TWO
QUARTERS.
QUARTERS. THAT’S A TECHNICAL RECESSION FOR
INDUSTRIAL PRODUCTION.
INDUSTRIAL PRODUCTION. ONE, YOU END UP HITTING YOURSELF
IN THE PROCESS, BUT SECONDLY,
INSTEAD OF WORKING WITH GERMANY
AND CANADA AND OTHER COUNTRIES
IN A COHERENT WAY THAT MIGHT
HAVE BEEN DIRECTED TOWARD
ISOLATING CHINA, THIS KIND OF
JUST, AGAIN, KIND OF DRUNK
DRIVING APPROACH ENDS UP JUST
CREATING RISK AND HARM IN THE
GLOBAL ECONOMY AND SO NOT ONLY
IS IT BAD WHEN GERMANY GOES TO
NEGATIVE GROWTH, BUT YOU’VE SEEN
THAT CHINA NOW HAD INDUSTRIAL
PRODUCTION AT ITS LOWEST IN,
PERHAPS, 17 YEARS.
NONE OF THAT IS GOOD.
IT’S NOT GOOD WHEN YOU HURT YOUR
OWN AGRICULTURE EXPORTERS AND
YOUR OWN MANUFACTURESRS, BUT WHE
YOU LOWER DEMAND IN THE WORLD,
IN GERMANY, IMPORTANT CUSTOMER,
IN CHINA, IN THE GLOBAL ECONOMY,
YOU HURT ALL OF THE PEOPLE IN
THE UNITED STATES WHO RELY ON
STRONG GLOBAL DEMAND, AND, YOU
KNOW, THE QUESTION NOW IS, CAN
HE PULL OUT OF IT?
YOU KNOW, YOU ASKED WHAT YOU
HAVE TO DO.
YOU ACTUALLY DON’T NEED TO KNOW
TOO MUCH ABOUT ECONOMICS TO KNOW
THAT WHEN YOU’RE DUGGING A HOLE,
STOP DIGGING AND THE WAY DONALD
TRUMP HAS, AGAIN, MANAGED THIS
ECONOMY IS THAT HE IS THE
NUMBER-ONE RISK FACTOR.
IF HE SIMPLY DID NOTHING, THE
ENTIRE U.S. AND GLOBAL ECONOMY
WOULD BE IN STRONGER SHAPE THAN
IT IS NOW.
>> RON, WE HAVE A FOX NEWS POLL
SAYING
SAYING SAYING UNSATISFIED WITH THE WAY
THINGS ARE GOING, A VERY GENERAL
STATEMENT.
STATEMENT. SATISFIED IS ONLY 40%.
UNSATISFIED IS 59%.
THAT IS BEFORE THE INVERTED
YIELD CURVE.
YIELD CURVE. >> YEAH.
>> YEAH. YEAH, I MEAN, I THINK THERE’S
ALSO AN INVERTED APPROVAL CURVE
FOR DONALD TRUMP THERE.
>> YES.
>> YES. >> IT’S HEADED IN THE WRONG
DIRECTION, AS IT SHOULD BE.
LOOK, I MEAN, AGAIN, I DON’T
THINK YOU CAN JUDGE A PRESIDENT
BY THE MARKET.
MARKETS ARE IMPACTED BY A LOT OF
FACTORS OUTSIDE HIS OR HER
CONTROL.
CONTROL. BUT YOU CAN JUDGE A PRESIDENT BY
THE POLICIES THEY PURSUE ON THE
ECONOMY AND WHAT DONALD TRUMP
PROMISED WAS TO INVEST IN
WORKING PEOPLE.
WORKING PEOPLE. HE PROMISED TO HAVE AN
INFRASTRUCTURE PLAN.
INFRASTRUCTURE PLAN. HE PROMISED THAT HE’D HAVE A
BIG, BEAUTIFUL HEALTH CARE PLAN.
HE PROMISED A LOT OF FUNDAMENTAL
STAPLES, KITCHEN-TABLE THINGS
FOR WORKING PEOPLE AND I THINK
PEOPLE FOR BETTER OR WORSE
BELIEVED HIM WITH THOSE PROMISES
AND HE’S DELIVERED ABSOLUTELY UP
IN OF THEM.
HE’S RUN THE MOST KLEPTOCRATIC
ADMINISTRATION IN HISTORY AND AN
ECONOMIC POLICY THAT’S
EXACERBATED INEQUALITY AND
DELIVERS ALL OF ITS GAINS TO
THOSE AT THE VERY TOP.
SO IT’S NO SURPRISE, UNLESS
YOU’RE POLLING THE VERY TOP .1
OF 1% THAT THE NUMBER IS PEOPLE
RUN SATISFIED WITH THAT.
AND AS YOU SAY, THAT’S BEFORE
TODAY’S EVENTS.
TODAY’S EVENTS. THAT’S GOING TO GET WORSE FOR
HIM, NOT BETTER.
>> RON KLAIN, THANK YOU VERY
MUCH FOR JOINING US AGAIN
TONIGHT AND GENE SPERLING,
ECONOMIC ADVISER TO PRESIDENTS,
COULD NOT DO THIS WITHOUT YOU,
AND AS THIS ECONOMIC NEWS
CONTINUES, WE’RE GOING TO NEED
YOU.
YOU. STAY BY THE PHONE, GENE.