STUART: W
.
CONNELL: WE HAVE HEARD FROM
PRESIDENT TRUMP THAT HE'S AIMING
FOR A TEA
FOR A DEAL WITH CHINA OVER THE
NEXT FOUR WEEKS AND CHINA TRADE
NEGOTIATORS ARE APPARENTLY
GETTING SET TO STAY THE WEEKEND
IN THE UNITED STATES TRYING TO
HAMMER THINGS OUT MAYBE SOONER
THAN THAT.
AMERICAN APPAREL AND FOOTWEAR
ASSOCIATION PRESIDENT AND CEO IS
WITH US IN THE STUDIO ON THE
ADMINISTRATION'S TRADE POLICIES.
YOU SAY THEY ARE PROOF THAT
TARIFFS ARE NO GOOD, I ASSUME.
THAT'S WHAT ALMOST EVERY
BUSINESS LEADER TELLS US.
>> WELL, I WOULD TELL YOU
TARIFFS ARE NO GOOD BECAUSE THEY
ARE NO GOOD AND I CAN BACK THAT
UP WITH 2002 STEEL TARIFFS, 2009
TIRE TARIFFS, 1932 SMOOT-HAWLEY.
TARIFFS JUST DON'T WORK.
CONNELL: IN HISTORY THEY DON'T
WORK.
HOLD ON A SECOND.
BUT WHAT?
>> BUT IF THIS WHOLE TRADE
FIASCO GOES AWAY WITH CHINA, IT
BROUGHT CHINA TO THE TABLE AND
WE GET A GOOD RESULT AND IT GOES
AWAY --
CONNELL: GOT TO GIVE THE
PRESIDENT CREDIT IF THAT
HAPPENS.
BECAUSE A LOT OF PEOPLE, THIS
WILL NEVER WORK, IT WILL ONLY
RAISE COSTS, COMPANIES ARE
TELLING US THAT INDEED IT HAS,
COSTS ARE GOING UP AND IT DID
HURT, GROWTH WOULD PROBABLY HAVE
BEEN BETTER LAST YEAR IF IT
WASN'T FOR THE TRADE POLICIES.
AT THE SAME TIME TO YOUR POINT,
MAYBE IT DOES WORK OUT AND
PEOPLE WILL HAVE TO COME BACK
AND SAY YOU KNOW WHAT, HE WAS
KIND OF RIGHT ABOUT SOME OF
THIS.
>> THERE ARE PLUSES AND MINUSES
TO EVERYTHING.
IF WE GET THE SIX CATEGORIES
THEY ARE TALKING ABOUT, IF WE DO
AWAY WITH THE TRANSFER OF
TECHNOLOGY AND THEFT OF
INTELLECTUAL PROPERTY, IF
THERE'S A LITTLE MORE OF A PEG
TO THE CURRENCY, WE GET MORE
ACTION --
CONNELL: LOT OF IFS.
>> AND WE GET SERVICES, IT'S A
HUGE WIN FOR THE ADMINISTRATION.
CONNELL: WHAT WORRIES YOU THE
MOST?
IN OTHER WORDS, THEY KEEP
TALKING ABOUT ENFORCEMENT, THEY
TALK ABOUT ALL THOSE ISSUES.
ARE YOU WORRIED ABOUT ONE THING
MAYBE BEING LEFT OUT OR MAYBE AS
AN ENFORCEMENT MECHANISM, SOME
OF THE TARIFFS ARE LEFT ON?
>> ENFORCEMENT IS A GREAT WAY TO
DOUBT WHETHER THIS IS SUCCESSFUL
OR NOT.
IF IT'S SUCCESSFUL, IT WILL BE
SUCCESSFUL.
THE ENFORCEMENT WILL BE, YOU
KNOW, WE HAVE A WHOLE HISTORY OF
THINGS NOT BEING ENFORCED.
THE MORAL OF THE STORY IS IF YOU
WANT TO CRITICIZE, I THINK YOU
CAN CRITICIZE IT ON THE
ENFORCEMENT.
YOU WON'T KNOW RIGHT AWAY.
YOU CAN ALSO FLIP IT AROUND AND
SAY LOOK, WE'VE GOT A DEAL.
THE ONE WORRY WE HAVE IS SEVERE
LONG TERM DAMAGE TO THE SUPPLY
CHAIN.
I KNOW IT'S AFFECTED OUR
INDUSTRY SERIOUSLY.
CONNELL: TELL ME HOW.
>> WHEN YOU BUILD A REALLY GOOD
SUPPLY CHAIN, YOU LOOK OUT FOR
HUMAN RIGHTS, WORKER RIGHTS, THE
ENVIRONMENT, SUSTAINABILITY, ALL
THE THINGS THAT ARE IMPORTANT TO
THE FUTURE, ESPECIALLY PRODUCT
QUALITY.
THEN WHEN YOU REARRANGE THAT
SUPPLY CHAIN, DISRUPT IT BECAUSE
ANALYSTS WHO I'M SURE YOU HAVE
HAD MANY ON THIS PROGRAM LOVE TO
CALL OUR MEMBER COMPANIES, WHO
ARE PUBLIC COMPANIES, AND SAY
WHAT'S YOUR CHINA EXPOSURE.
YOU NEED A GOOD ANSWER TO THAT.
IF YOU ARE 80% IN CHINA, THAT'S
NOT NECESSARILY A GOOD ANSWER.
CONNELL: YOU CHANGE IT AND NEVER
CHANGE BACK?
>> WELL, THAT'S THE PROBLEM.
YOU START MOVING IT OUT SO WHEN
YOU MOVE IT OUT, YOU GET BUMPER
CAR INFLATION BECAUSE YOU MOVE
OUT, YOU BUMP SOMEBODY OUT OF A
FACTORY, THEY GET BUMPED
SOMEWHERE ELSE, YOU START A
DETERIORATION --
CONNELL: YOU SEE A LOT OF THAT
ALREADY?
>> WE KNOW IT'S HAPPENING
ALREADY.
I WAS IN CHINA SEVERAL MONTHS
AGO.
I THOUGHT MAYBE THERE WOULD BE
SOME EROSION.
THERE WAS REALLY WHAT WE CALL
CHINA FLIGHT.
PEOPLE WERE BAILING.
CONNELL: WOW.
THAT DOESN'T CHANGE BACK?
>> IT DOESN'T COME BACK.
CONNELL: THIS WHOLE THING, LAST
QUESTION, WE'VE GOT TO GO, IS
THIS WHOLE THING WORTH IT IS THE
BOTTOM LINE?
>> WELL, FI
>> WELL, IF IT ENDS SOON, MAYBE
WE CAN SAY IT'S WORTH IT.
IF IT DOESN'T END SOON, IT
CONTINUES TO BE A PROBLEM FOR
EVERYONE.
CONNELL: SOON AS IN A COUPLE