ON-THE-RECORD PRESS CALL
BY PETER NAVARRO, DIRECTOR OF THE OFFICE OF TRADE AND MANUFACTURING POLICY
ON PRESIDENT TRUMP'S BUY AMERICAN AGENDA
Via Teleconference
12:07 P.M. EDT
MR. NAVARRO: Thank you. Hi. It’s Peter Navarro here, Director of the Office of Trade and Manufacturing Policy.
What I’m going to do methodically -- and this will all be on the record -- is to work through the latest report from the White House Office of Trade and Manufacturing Policy. This report, entitled “Donald J. Trump: The Buy American, Hire American President” will be released this afternoon. You’ll get a copy of this sometime this afternoon, probably with this embargo until three o’clock.
Since the inauguration of President Donald J. Trump on January 20th, 2017, my mission at the White House has been to help the greatest jobs President and trade negotiator in history rebuild America’s manufacturing base. And over the past four years, this administration has led by one beautiful phrase, “Made in the USA,” and two simple rules: Buy American, hire American.
What we do in this report is take you through a tour of five critical dimensions of President Trump's “Made in the USA” strategy. The point here is simply that “Buy American” is much, much more than simply “Buy American” rules in government procurement. It's also four other things: It has to do with the “Hire American” actions we've taken. The Trump trade negotiations and tariffs are very much a “Made in the USA,” “Buy American, Hire American” strategy. The fourth dimension has to do with our defense budget on military sales. And the last dimension we'll talk about is the one of the oldest pieces of “Buy American” legislation: the Jones Act.
A major theme underlying this report is something that President Trump has said many times: Economic security is national security. The concept here is that when we engage in “Made in the USA” actions, that not only creates jobs and prosperity, it also strengthens both our manufacturing base and our defense industrial base in a way which makes our nation more secure.
The subject of this reporting is purely a policy statement rather than a political one. It is the claim by former Vice President Joe Biden to the two words “Buy American.” We were, frankly, amazed that Joe Biden would try, yet again, another kind of plagiarism -- this time of a key platform plank of President Trump's entire administration.
I would just remind everybody that it was Joe Biden who gave us made “Made in Mexico”'s NAFTA in 1994 and “Made in Shanghai, China” into the World Trade Organization in 2001.
And I think what you'll see as I walk you through this report is really a comprehensive and well-thought-out strategy that dates back to candidate Trump promising that the two simple rules -- the “Buy American, Hire American” -- would be that which governs this administration.
So let me -- let me take you through this Magical Mystery Tour here of our “Made in the USA” strategy. And let's start with the “Buy American” procurement, which is the most obvious.
We spend about $200 billion a year -- taxpayer funds -- on projects like roads and bridges and building construction. There's substantial legislation Congress has passed over the years to ensure that when the government spends money on such procurement, the products are made in whole or in part in the USA. But there's just a lot of loopholes that have existed in the law.
So what we've done since the President took office is set out to enforce, strengthen, and expand these “Buy American” procurement policies. And as you'll see in the report, the President has signed at least 10 “Buy American” executive orders. One of them has made it more difficult to grant unnecessary waivers. That EO also extended “Buy America”’s reach through (inaudible) federal financial assistance to the states and local governments.
Some of the “Buy American” EOs target specific industries. For example, Communist China can no longer sell bulk power equipment to the U.S. This is important because Chinese malware or corrupted components can threaten our national electricity grid.
We also had a really great order for commercial fishermen, which opens up new markets; reduces unnecessary regulations; cracks down on unfair trade practices in countries like China -- it's always China; and streamlines the aquaculture permitting process.
My favorite of these executive orders -- and I think, in many ways, the most important in light of the Communist China virus and the pandemic -- is the most recent order, the order signed that is designed to invoke “Buy American” for our essential medicines in what's called medical countermeasures that we need to fight pandemics and crises like the China virus. And that one, of course, on August 6, 2020, requires that our essential medicines and medical countermeasures be purchased domestically by agencies like Defense, Veterans Affairs, and Health and Human Services.
The one metric I can give you -- two metrics, actually: If you look at domestic procurement in the Obama-Biden years, we see that it went from $323 billion to $419 billion in the Trump -Pence years. That's about a 26 percent increase. And that comparison is based on Obama-Biden fiscal years 2015 plus 2016 versus Trump-Pence 2018/2019. We skipped 2017 because those -- that's an overlapping year.
All right, so that's dimension number one.
Let's go to dimension number two which is “Hire American.” And we got three different areas where the President has really taken strong action: visa abuses, apprenticeships, and the veterans’ transition to the civilian workforce.
And what we do is we lay out all of the many things the President has done in this area. I highlight a few. I mean, the Justice Department has helped crack down on visa abuses, where there's been attempts to replace American workers with cheap foreign labor. The President, in June, halted the visas for foreign workers through the end of the year so that in our current situation we wouldn't have foreign workers taking urgently needed jobs for Americans.
There's also the ignominious case in the Tennessee Valley Authority which tried to lay off more than 200 employees -- forced those employees to train their foreign replacements. President Trump signed an executive order on that; fired the chairman and board member. And TVA has backed off from that.
On the apprenticeship front, we've really been very aggressive about this. This is so critical really to ensuring a strong manufacturing base and also meeting the challenges of new technology.
We've had -- since the June 17th executive order on this, the Department of Labor has registered nearly 816,000 people entering apprenticeship programs. The Office of Economic Initiatives created the Pledge to American Workers. That has resulted in 440 companies and organizations participating and 16 million new education and training opportunities for American students and workers.
Interestingly enough, President Trump also reformed the hiring practices of the federal government, which was arbitrary -- kind of, one-size-fits-all, degree-based focus. And what we've been able to do is make this more skills-based, and that gets us a deeper pool of talented individuals to best serve our nation.
President Trump loves our veterans. Just loves our veterans. He signed three pieces of legislation to help them transition into the civilian workforce: The Hire Vets Act, the Valor Act. And also, we've got numerous executive orders which are designed to assist the transition of military personnel into civilian activities -- not just the military personnel themselves, but also their spouses.
One of my favorites in this regard is the executive order that helps our sea veterans transition from Coast Guard, Marines, and the Army and Navy to the Merchant Marine. This is one of the remits of this office to make sure we have enough Merchant Mariners to provide for our military in times of conflict. So I think that order was quite important.
So that's the first two dimensions.
The third dimension has to do with trade policy and tariffs. As you know, the Trump-Pence administration inherited a broken global trade system in which overseas competitors and predatory foreign governments stole our technology, unfairly subsidized national champions, and dump their products into our markets.
I would remind you that this was a product of about 20 years of malfeasance by politicians on both sides of the aisle, including people like Bill Clinton and Joe Biden who supported both NAFTA and China's entry into the World Trade Organization.
Going back to Bush-Cheney and through Obama-Biden, we lost over 70,000 factories and millions of manufacturing jobs to the NAFTA and China trade shocks. States like North Carolina with their textile and furniture industries got hit first and hard. But after that, the NAFTA and China shocks would ripple across the manufacturing heartland of America to Minnesota, Wisconsin, and Michigan, through Ohio, Pennsylvania, and beyond.
It's been a cornerstone President Trump's economic plan to fix this broken system. And if you look at what he's done, it's been truly remarkable by any measure.
Both President Obama and President Trump promised to renegotiate NAFTA. Guess who did that? The -- it was interesting that during the NAFTA debate, you had the usual suspects from globalist-oriented places like the Peterson Institute telling us that NAFTA would create 170,000 U.S. jobs and that our trade balance with Mexico would remain in surplus. How's that working out? And then the Obama-Biden ticket promised to renegotiate NAFTA in 2008. How's that working out?
But the point, I think, is that with USMCA, which entered into full force, I view this as the Full Employment Act for the American auto industry. It raises the North American content 75 percent and then ensures that a lot of that will be in Detroit by imposing tough labor and environmental provisions on Mexico.
You've got the Korean deal, which -- that was Hillary Clinton's baby. Again, the same -- the same usual suspects, same scenario, telling us that our exports would go up and we'd have more jobs. In fact, just the opposite happened.
The most important thing about that deal is that it prevented the tariffs on South Korean light trucks and pickups from expiring in 2021. Ambassador Lighthizer pushed that out until 2041. And if we hadn't done that, Detroit would have been all but dead because pickups and light trucks really are what holds our auto sector together in many ways.
The Japan deal -- nice, targeted deal for $7 billion in agricultural goods -- what it did basically: also eliminated any day damage that might have happened because of Japan's joining the Trans-Pacific Partnership. It's really important to understand the TPP because that's something, again, that Joe Biden says he’s going to jump right into.
This was sold to us by the Obama-Biden administration and the globalist elites as a strategic counterweight to Communist China’s influence in Asia. But President Trump very clearly understood that the TPP would have required the U.S. to turn over much of its auto and auto-parts sector, particularly to Japan and Vietnam, and in exchange for someone undefined and uncertain alleged strategic benefits. And that was really a deal breaker. The idea of sacrificing America's auto industry on the altar of national security was the TPP deal breaker.
As President Trump has said, any nation that trades its prosperity for security will end up losing both. So the TPP is by -- sometimes the best trade deal is the one you don't sign to begin with, and TTP is certainly in that category.
If you switch to the Trump tariffs, these have been enormously successful. They were met with great skepticism when they were first imposed. And the globalist elites in the fake news continue to try to drum up stories attacking these tariffs, but the reality is that if you look first at the steel and aluminum tariffs, these are central elements in the ships, planes, missiles, bombs, and combat vehicles we need to fight back against strategic opponents like China, Russia, and Iran.
When we put the tariffs on in March of 2018 -- and here's what we've seen just statistically: During the Obama-Biden years, we saw steel imports, as a percent of total U.S. consumption, rise from 22.7 percent in 2009 to 30.1 percent in 2016. And this was a great hardship to our industry.
As the -- through the first six months of 2020, we've got that below where it started in the Obama administration, down to 21.8 percent. And equally important, we’ve seen a tremendous amount of new investment. But one of the great attributes of tariffs is they help induce investment domestically. Steel companies have announced more than 29 additional new projects or expansions, totaling more than $9.5 billion. We've seen the same thing with aluminum -- 37 new projects or expansions, totaling $4.8 billion.
And, by the way, on the aluminum issue, the Obama-Biden administration just about killed that industry. Just from 2015 to 2016, aluminum imports as a share of total U.S. consumption jumped from 41 percent to 53 percent. And right now, we're down to 22 percent as of 2019, thanks to the Trump tariffs.
If you look at the China tariffs, we've got the economic aggression of Communist China and its seven deadly sins against American workers. It's always useful to summarize what those seven deadly sins are: the cyber intrusions by Chinese government officials to steal American business secrets. I would note that that's still -- we’re in 2020 now, and that's five years after Xi Jinping, the general secretary of the CCP, told Barack Obama in the Rose Garden that he would stop doing that. Clearly, that was a lie.
Sin two: intellectual property theft. You got forced technology transfer, dumping of products below cost into our markets, abuse of state-owned enterprises to bully American companies, a long history of currency manipulation, and let’s not forget all the Americans dying from Chinese fentanyl and opioids.
What we have now are two successes: tariffs on more than $360 billion, which has delivered over $60 billion to the U.S. Treasury. And in a fact-check on Joe Biden, who claimed that our deficit with China keeps rising, that is wrong. After reaching a peak in October of 2018, and after the Trump-China tariffs kicked in, our trade deficit with China has in fact been declining for the first time in over a decade. We also, under pressure from the Trump tariffs, got Communist China to sign a phase one trade deal on August -- excuse me, on January 15th, 2020. And at least they appear to be making historic purchases of corn, soybeans, pork, beef, and chicken.
The solar and washing machine tariffs are likewise wildly successful. We had a situation here -- again, it's always Communist China sticking it to us, it seems like -- 2012 to 2016, China increased its illegal dumping of solar panels and modules. Imports soared by 500 percent, prices fell by 60 percent, and we lost 25 U.S. solar panel and module manufacturers to this Chinese predation.
And after a case at the International Trade Commission, the President approved tariffs on eight and a half billion dollars’ worth of solar panel imports. That has got us, yes, 2,600 U.S. jobs across eight factories and preserved 1,750 jobs across five factories, and the U.S. is now home to the two largest solar manufacturers in the Western Hemisphere.
We got a similar situation playing out where, for a change, it wasn't the Chinese this time; it was the Koreans -- LG and Samsung -- attacking our washing machine industry, although I would note that LG and Samsung did it with the help of the Chinese. President Trump levied tariffs on foreign washing machines. And I personally visited the “Pride of Clyde” in Ohio, Whirlpool. And they roll out washing machines now at the rate of one every four seconds. It's pretty impressive. Thank you, Donald J. Trump.
We've also seen, interestingly enough, LG and Samsung having found out that if they can't beat the tariffs they'll join them -- they've invested in large manufacturing facilities in South Carolina and Tennessee, and they'll be creating over 1,600 U.S. jobs in America, rather than Seoul.
The last element of dimension three -- I do have to give a shout-out to Secretary Wilbur Ross; he's the tip of the spear for what's called “anti-dumping and countervailing duties.” Anti-dumping duties are used when products are exported to the U.S. at prices below cost. And then countervailing duties are used for unfair export subsidies.
What we've seen is a substantial increase in orders. They’re called AD and CVD orders. We got 62 in the Obama-Biden administration in the last four years -- no, in the first four years of that administration. And then that compares to 188 orders for the Trump Commerce Department, a 203 percent increase. Again, congratulations to Wilbur Ross.
The fourth dimension is a combination of defense budget hikes and an expansion of foreign military sales. The increases in the defense budget translate directly into increased American manufacturing because much of the production in America's defense industry follows very strict “Buy American” rules, but at the same time, selling -- foreign military sales really yield some benefits I'll talk about in a minute.
I think the top line for the defense budget hikes is this: Obama-Biden cut the defense budget by about 16 percent and had a -- just a crushing blow to our defense industrial base and resulted in a significant deterioration of our combat readiness. It really was unconscionable what that administration did. And they were clueless both to the importance of defense industrial base in our economy, as well as in our security.
We're now at over $700 billion per year in the defense budget. At a macro level, the Council of Economic Advisers estimates that support -- these hikes support 1.1 million jobs and contribute about a quarter point of GDP growth per year. And that’s just very substantial.
But at the micro level, you can also go around the country, as I have, and look at facilities which would otherwise be diminished or shut down -- just really flourishing now. A couple I'll mention on the map: the Lima Tank Plant in Ohio; similar facility in York, Pennsylvania; a similar facility in Oshkosh, Wisconsin; you've got the shipyards in Marinette, Wisconsin, and Philadelphia and Panama City.
And “economic security is national security,” again, is the theme. These create great jobs, they also keep our nation secure.
The foreign military sales is really interesting. The Trump-Pence administration has really taken a very different approach to that. Obama-Biden didn't seem to want to help our strategic allies and partners, and they didn't realize they were shooting us in the foot.
But this is pure “economic security is national security.” When you sell items like the M1 Abrams tank, the F-16 fighter jet, the THAAD missile defense system, that's tens of thousands of manufacturing jobs and supply chains across America, and workers of all backgrounds benefit -- the high-paying jobs, scientists, engineers, software designers, welders, machinists, electricians.
But these sales also, on the national security front, strengthen our alliances and also reduce the need for American boots on the ground in foreign lands, which is a high priority of President Trump.
All I can tell you on the FMS for a topline stat is we're looking at a 38 percent increase in fiscal years 2018, 2019 compared to the last two complete fiscal years of the Obama-Biden administration. And it adds up to more than 130,000 additional jobs.
So let me end this report discussion with a brief comment on the Jones Act -- one of America's oldest pieces of legislation. It requires that any vessel transporting merchandise between two points in the U.S. be built, owned, and crewed by American citizens. And the “built” part of the Jones Act helps ensure America has a robust domestic shipbuilding capability, which is critical to our defense industrial base.
And then, the Jones Act ships be crewed by Americans likewise helps ensure our nation has a Merchant Marine workforce efficient to serve both our commercial and military needs.
And I want to remind you that Merchant Mariners, during times of conflict, transport military goods, such as tanks, helicopters, and troops, and they really are mission critical.
And, you know, we’re up against Communist China again, which provides really extreme subsidies to their shipbuilding industry. They're now -- they control the world's second-largest fleet and construct a third of the world’s ships, while our shipbuilding industry, prior to the Trump-Pence administration, has been in steep decline. But we've begun to turn that around.
During the eight years in the Obama-Biden administration, a number of U.S. flagships dropped 22 percent, and gross tonnage fell 13 percent. Right now, we bounced off the Obama low by 10 percent, and tonnage is up to 7.3 million tons.
So, that's -- that’s the big overview of the report. We'll get this out to you by email this afternoon. And let's keep this embargoed until three o'clock so everybody can operate on the same playing field.
We will have a video on this, which should be posted to the Whitehouse.gov site within a couple of days. And, right now, I'll do -- I'll take a few questions, but please do me the courtesy of asking questions only about this report.
I'll turn it over to the moderator now.
Q Hi. Firstly, I’d just like to convey my best wishes to the President and his family. And thank you, Dr. Navarro, for having this call and all your hard work to put American workers first.
So you probably know, yesterday, Congressman Brooks introduced the American Jobs First Act to overhaul the H1B program. And I was just wondering: Is this the program that they -- the President supports? Like, does he support this bill to overhaul the H1B program? And is there anything in there -- for example, the suspension of the F-1 OPT program -- that the President could consider implementing by executive action?
MR. NAVARRO: I can't speak to the bill itself. The one thing I can tell you in the report is reference to the memorandum of understanding that was signed between the Department of Labor and the United States Citizenship and Immigration Services. It allows the two departments to share immigrant and nonimmigrant petition records and data, and really marks the first time DOL will have access to suspected employer violations within the H1B visa program.
This kind of Secretary of Labor-certified tool has never been used. What we are clearly signaling is that we are taking this area very seriously.
Thank you. Next question.
Q Hi. Thank you, Dr. Navarro, for this briefing. I have a question about Kodak deal -- pharmaceutical deal -- which was put on hold in August. Is there any update on that? And is the White House in talks with other companies to replace Kodak? Thank you.
MR. NAVARRO: So this is a “Buy American” report, so we'll go to next question.
Q Hi, thank you for doing this call. I guess another piece of the -- you know, helping U.S. businesses is the China trade deal. And I was just wondering if Trump will keep phase one in place before the election, even if the Chinese are still falling short on purchases.
MR. NAVARRO: Again, this is the “Buy American,” report so we'll go to the next question.
Q Hi, Dr. Navarro. So, as part of your explanation for this report, you said that President Trump's tariffs have been enormously successful and that they're very much part of the “Made American, Hire American” strategy. But more than 3,700 U.S. companies, including Coca-Cola, Ford, Home Depot, Target, and Tesla, have filed lawsuits against the Section 301 tariffs with the Court of International Trade and are asking for a refund plus interest. What do you make of those lawsuits?
MR. NAVARRO: I think it underscores the fact that there's a schism between the working men and women of America, particularly in blue-collar manufacturing, and the globalist elites who run our multinational corporations. And for decades, going back to Joe Biden's NAFTA, have chased cost efficiencies around the world without any regard for the United States of America. So this behavior by these corporations is, in my judgment, “dog bites man,” but it's still reprehensible.
This President, Donald J. Trump, is the President of blue-collar America and represents the party in the working class. These multinational corporations, basically, do not.
Next question and last question.
Q Hi there. Thank you very much for doing this call. Thank you for the access. I'm going to ask the question that's on a lot of people's minds today, especially because other White House officials have responded on record about it --
MR. NAVARRO: All right. I think we're -- I think we’re done here. Thank you. Bye-bye.
END 12:43 P.M. EDT |
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