.

[06:25 of Video] SECRETARY TILLERSON: Well, I’m delighted to be in Cairo, my first trip to Egypt as Secretary of State, and to really have very comprehensive discussions about this almost one-half-century relationship between the U.S. and Egypt and our commitment to strengthening this partnership in the years to come.

I’m also very pleased to be with Foreign Minister Shoukry, who has become a friend as we have engaged on a number of challenges in the region and to address those jointly and with a great deal of agreement between us as to how those issues need to be addressed. I look forward to my meeting with President al-Sisi and appreciate his receiving me as well.

We had a very productive discussion on our shared regional and security concerns. We spoke about opportunities as to how to strengthen our ties and, as the foreign minister indicated, mechanisms by which we can deepen those ties and further explore areas for mutual cooperation, first through the strategic dialogue which we’ve agreed we will have later this year, and then we’re going to explore also the possibility of a 2+2 dialogue to even allow us to further enhance these conversations both on a full range of issues of not just security concerns, but political and economic opportunities as well.

I did express to the foreign minister our condolences to the people of Egypt for the violence that they have been suffering from the terrorist attacks perpetrated by ISIS and other terrorist groups. Egypt’s been battling this level of extremism for many years, and we continue to be steadfast partners in their response to these attacks throughout this time.

We agreed that we would continue our close cooperation on counterterrorism measures, including our joint commitment to the defeat of ISIS, and Egypt has been a very important member of the Defeat-ISIS Coalition from the beginning. They – Egypt deals with the threats of ISIS themselves and are dealing with it certainly currently in the Sinai.

We also discussed the importance of the protection and promotion of human rights and the vital role of civil society in Egypt. With the presidential elections planned for the end of March, the United States, as it does in all countries, supports a transparent and credible electoral process, and all citizens being given the right and the opportunity to participate freely and fairly.

On Libya, the United States and Egypt support the UN’s Action Plan for Libya for credible and peaceful elections in their country. This will promote stability – much-needed stability for Libya and their economy to prosper. As the Security Council affirmed on December the 14th, the Libyan Political Agreement in our view must remain the framework for a political solution throughout Libya’s transitional period.

Foreign Minister Shoukry and I also discussed Syria and how we can work together to reinforce the UN-led Geneva political process, which is the only political framework through which this conflict can be resolved. And Egypt has played a very important role in supporting dialogue between opposition representatives and the central government in Damascus.

On the Middle East peace, I reiterated that the Trump administration remains committed to achieving a lasting peace agreement between the Israelis and the Palestinians.

Now, the foreign minister and I also discussed how we can intensify our countries’ economic engagement and support our private sectors to generate jobs and prosperity for both of our people, and I acknowledged and welcomed the very important – although we know difficult – steps towards reform that President Sisi has undertaken in order to create a very strong foundation for future prosperity and economic performance in Egypt, and those have been necessary, although difficult, to be fully – receive the full support of the IMF, and Egypt has met all of those requirements.

We’ll do what we can to continue to encourage the economic recovery and we hope that American companies are able to increase their investments in Egypt that will create jobs and opportunities here as well.

The United States, again, commits itself to standing with Egypt, standing shoulder to shoulder in these – in the fight against terrorism, but also standing together to create a more stable region for everyone as well, and I thank the foreign minister for our opportunity to meet and exchange on so many important issues. Thank you.

FOREIGN MINISTER SHOUKRY: Thank you very much.

MODERATOR: (In Arabic.)

QUESTION: (In Arabic.)

SECRETARY TILLERSON: Well, I think the commitment the U.S. has to Egypt’s security in the fight against terrorism should be evident, and both with the release of about a billion dollars of foreign military financing assistance to Egypt to continue to strengthen its capabilities, and also sharing of other approaches to countering terrorism, some of which we can talk about, some of which we can’t so easily talk about. But our joint commitment to defeat ISIS is steadfast and there has been no gap between Egypt and the United States in our joint efforts to confront terrorists and extremist – extremism in the region, but most specifically here in Egypt as well.

So I think the Egyptian people should be confident that the U.S. commitment to continuing to support Egypt in this fight against terrorism, in bringing security for the Egyptian people is steadfast, and that will continue, and we had a great deal of exchange today about how we can advance that. And we just mentioned the intent to have a strategic dialogue later this year. All of these are opportunities for us to identify other ways that we can strengthen and support Egypt’s fight against terrorism, but also, ultimately, to strengthen the economic development of Egypt as well.

MODERATOR: (In Arabic.) Carol, Washington Post.

QUESTION: Thank you. Mr. Secretary, given the concerns (inaudible) to run against the president (inaudible) election and who were arrested and disqualified, how (inaudible) do you believe those elections will be? And will the United States consider withholding more military aid from Egypt (inaudible)?

And Mr. Foreign Minister, sir, human rights groups have called this the most repressive era in modern Egyptian history. What did Secretary Tillerson tell you about democracy and civil liberty here in Egypt? And will anything change here in Egypt after your meeting today? Thank you.

SECRETARY TILLERSON: Well, I think as I indicated in my prepared remarks, and I would answer the same: We have always advocated for free and fair elections, transparent elections, not just for Egypt but in any country. And so the U.S. is always going to advocate for an electoral process that respects the rights of its citizens to make the choices the citizens want to make and the full participation of citizens in those elections. And nothing has changed about our advocacy for those types of elections.

FOREIGN MINISTER SHOUKRY: As relates to some of the comments that have been made by certain members of the human rights community and other activists, I would only recommend that you ascertain for yourself the nature and the current situation in Egypt as relates to human rights, and how the Egyptian people view this administration and its efforts to strengthen and protect human rights, and whether there is that sense of restriction that you alluded to. I think it is – it isn’t helpful that a certain group projects from a perspective of lack of information, lack of direct association to a society, but it is much, much more important the general conditions, the freedom of press that is available, the variety of television shows, the dialogue and the exchange. Development in the social and political field is an evolutionary process. I think over the last 11 years, the Egyptian people have shown their commitment and their determination and their ability to change their course and to indicate their dissatisfaction. If they deemed that they were dissatisfied, they have been able to change two governments in the last seven years, and they have undertaken legislative elections and know how to protect their rights and to advocate for those rights.

So it’s important that I think we recognize that it is the Egyptian people who should determine how they are applying their freedoms and their political activism, and I hope that you will have the opportunity while you’re here in Egypt to discuss this with the Egyptians on the street and ascertain from them directly whether they are satisfied with current conditions.

We had a discussion with the Secretary related to Egypt’s efforts to develop both politically, economically, and socially, and that we continue to do so out of our desire to see Egypt evolve into a place of – that can fulfill the aspirations of its people, and we will continue to rely on the support that we can depend on from the United States in this regard. These are commitments that this administration is confident it will fulfill, and it is responsible to the Egyptian people to continue to fulfill those commitments, as has been stipulated in our constitution.

MODERATOR: (In Arabic.)

QUESTION: (In Arabic.)

SECRETARY TILLERSON: Well, I think it’s important to note that in the announcement President Trump made regarding Jerusalem he also made two very important points as well, one of which was he was not advocating for any change to the status quo as to oversight of the holy sites, recognizing the proper role of existing authorities; and the second is that the final boundaries of Jerusalem are yet to be determined, and that those will be decided among the parties. And those – I think it’s oftentimes those two important points seem to have been overlooked in his announcement. And yes, the U.S. is still committed to the peace process and still believes we have an important role to play in bringing the parties together and seeing a resolution to this. And President Trump is committed to that.

FOREIGN MINISTER SHOUKRY: (In Arabic.)

MODERATOR: (In Arabic.) Wall Street Journal, Felicia.

QUESTION: Thank you. Secretary Tillerson, Vice President Pence, in an interview with The Washington Post, endorsed what you’ve described publicly as talks about talks with the North Koreans, and president – South Korea’s President Moon said he would go to Pyongyang. Is this the start of a diplomatic process in North Korea?

And then for Foreign Minister Shoukry, the U.S. has in the past raised concerns about Egypt’s ties with North Korea. What is Egypt doing to cut those ties?

SECRETARY TILLERSON: I’m not sure I could hear the last part of your question.

QUESTION: I was just asking if this – is this the start of a diplomatic process with North Korea?

SECRETARY TILLERSON: Well, as to – as to the Vice President’s comments about potentially having talks and whether it’s the start of a diplomatic process, I think it’s too early to judge. As we’ve said for some time, it’s really up to the North Koreans to decide when they’re ready to engage with us in a sincere way, a meaningful way. They know what has to be on the table for conversations. We’ve said for some time that I think it’s important that we have – we’re going to need to have some discussions that precede any form of negotiation to determine whether the parties are, in fact, ready to engage in something this meaningful, in order for us to then put together the construct of a negotiation. So we’ll just have to wait and see.

FOREIGN MINISTER SHOUKRY: We did discuss with Secretary Tillerson the issues related to North Korea, the Korean Peninsula, and the security of that region. Egypt has had normal diplomatic ties with North Korea, as does many Western and NATO members, and those ties are, in terms of the relationship, limited to representation, and there is almost no existing economic or other areas of cooperation. But we are concerned with the current status with the threats emanating from the proliferation of nuclear weapons, a situation which we deem as threatening to the global nonproliferation regime, one that has to be dealt within our maintaining global security, also the threats of ballistic missile systems to South Korea and to Japan, and we believe that all of these issues must be resolved for the security of the region and the Korean Peninsula. And we will continue to discuss these issues and to take the appropriate measures to deal with these challenges.

Thank you very much.

[End Transcript]

Consider this a kick-off to my official NAFTA watch.  Readers will note my earlier spidey-sense prediction of NAFTA withdrawal announcement in/around the end of February through March.   I cannot see a delay in an announcement extending beyond March 2018.  Ergo, CTH is fine-tuning the radar to watch closely.

The fatal flaw within NAFTA has not been addressed.  Neither Canada nor Mexico has even slightly indicated a willingness to engage talks over the fatal flaw.

Exactly the opposite happened earlier this month when Canada signed up to the TPP deal.

The agreement has yet to be ratified by Canadian Parliament, and many are nervous, but it will likely get done.

The NAFTA decision will be the biggest political and economic decision in the Trump administration so far, and the corporate GOPe response is anticipated to be beyond ugly.  Additionally, it would be intellectually dishonest not to accept there are very specific interests watching these pages as part of their proactive strategy. (Hi, Tom)

That said, if you were Mexican President Enrique Peña Nieto and you noted the specificity of the current trade-policy planetary positions; and you were overlaying the preparatory action taken by Justin from Canada; and you understand there are factually hundreds of billions in play; you would be a fool not to go past past Economy Minister Ildefonso Guarjardo and directly engage the ultimate decision-maker, U.S. President Donald Trump, out of an urgent need to evaluate the survivability of your economic surroundings.  It would be imprudent not to prepare yourself:

(White House) President Donald J. Trump spoke today with President Enrique Peña Nieto of Mexico to offer condolences to the families of the victims of the helicopter accident in Oaxaca. President Peña Nieto returned the sentiment and expressed Mexico’s solidarity with the United States following the high school shooting in Parkland, Florida. President Trump underscored his commitment to expanding cooperation between the United States and Mexico on security, trade, and immigration.

The basic issue is a simple one – for the United States NAFTA has a fatal flaw.  Canada and Mexico are used by China, Europe and Asian nations as a way to work-around direct trade with the U.S. and those nations use NAFTA as a backdoor into the U.S. market. It works out great for Canada and Mexico, but terrible for the U.S.

It is a structural issue and no amount of negotiation is going to remove the fatal flaw unless Canada and Mexico agreed to terms that are directly against their prior financial interests.  Absolutely ZERO action has been taken to address this issue through six rounds of prior NAFTA discussion.  Round six ended with VERY terse words from U.S. Trade Representative Robert Lighthizer specifically over this issue.

Justin from Canada recently signed up to the Trans-Pacific Partnership.  With that decision the fatal flaw -from a U.S. perspective- just became the final straw to end the U.S. participation in NAFTA.

The U.S. cannot make any bilateral trade deals with TPP nations while those same TPP nations have an alternative access route to the U.S. market through Canada via NAFTA.

Therefore the only way for President Trump to finish a trade agreement with South Korea (current tense negotiations – see Samsung etc.) is to first remove their NAFTA alternative. Anticipating this reality S-Korea also filed a WTO trade challenge earlier today.

Absent of massive last-minute economic concessions (I’m talking full-blown acquiescence) by Canada and Mexico there is no alternative other than for President Trump to withdraw.

Understandably, South Korea is currently hosting the U.S. Olympics and it would have been extremely poor form, very impolite, and economically very destabilizing for Moon Jae-in if POTUS Trump had made the NAFTA announcement in the months/weeks leading up to their international spotlight event.  [It’s not only CTH who follow the global tentacles of multinational trade decisions.]

However, with the Olympics ending next week that diplomatic hurdle is removed… the countdown clock now officially begins.

While speaking during a White House ceremony earlier today President Trump announced he has directed Attorney General Jeff Sessions to develop regulations surrounding “bump fire stocks”, noting the intended regulation would be an actionable step to help prevent future mass shootings.

During his remarks President Trump noted: “We cannot merely take actions that make us feel like we are making a difference, we must actually make a difference.” The decision to eliminate ‘bump-fire stocks’ is smart policy and politically.

On the policy side the regulatory move is in line with already existing rules on firearms that ban auto-fire weapons. On the political side the memorandum stops opposition from saying the President is not taking action; the regulatory memorandum reflects action taken by President Trump that was not taken by President Obama.

(From the memorandum) After the deadly mass murder in Las Vegas, Nevada, on October 1, 2017, I asked my Administration to fully review how the Bureau of Alcohol, Tobacco, Firearms and Explosives regulates bump fire stocks and similar devices.

Although the Obama Administration repeatedly concluded that particular bump stock type devices were lawful to purchase and possess, I sought further clarification of the law restricting fully automatic machineguns.

Accordingly, following established legal protocols, the Department of Justice started the process of promulgating a Federal regulation interpreting the definition of “machinegun” under Federal law to clarify whether certain bump stock type devices should be illegal. The Advanced Notice of Proposed Rulemaking was published in the Federal Register on December 26, 2017. Public comment concluded on January 25, 2018, with the Department of Justice receiving over 100,000 comments.

Today, I am directing the Department of Justice to dedicate all available resources to complete the review of the comments received, and, as expeditiously as possible, to propose for notice and comment a rule banning all devices that turn legal weapons into machineguns.

Although I desire swift and decisive action, I remain committed to the rule of law and to the procedures the law prescribes. Doing this the right way will ensure that the resulting regulation is workable and effective and leaves no loopholes for criminals to exploit. I would ask that you keep me regularly apprised of your progress.

You are authorized and directed to publish this memorandum in the Federal Register. ~President Donald J Trump (White House Link)

Earlier today President Trump hosted an event ceremony honoring Public Safety Medal of Valor recipients.  The President began his remarks with comments on the Parkland FL school shooting.

NAFTA is as precarious as a slow-spinning plate on a stick. Mexico and Canada are both  taking half-hearted turns recharging the momentum – while simultaneously looking for trade options due to, well,.. the inevitable.

The basic issue is a simple one; for the U.S. NAFTA has a fatal flaw. Canada and Mexico are used by China and Asian nations as a way to work-around direct trade with the U.S. and use NAFTA as a backdoor into the U.S. market.  It works out great for Canada and Mexico, but terrible for the U.S.  It’s a structural issue and no amount of negotiation is going to remove the fatal flaw unless Canada and Mexico agree to terms that are directly against their current financial interests.

Ergo POTUS Trump is positioned to withdraw.

Trying to keep the U.S. in NAFTA, but understanding the likelihood of exit, Justin from Canada originally approached China for a big trade deal.  Justin didn’t find Happy Panda in his discussions; instead he found The Red Dragon behind the Panda mask.  China was willing to talk trade, but China tiered their approach because Canada is only valuable to China as long as the NAFTA door is open.  Without NAFTA China has no use for Canada.

Justin left China with dragon burns and immediately realized his trade cards were getting weaker by the day…. so he had to sign-up for the Trans-Pacific-Partnership.  Unfortunately for Justin, though some think he didn’t realize the consequence, signing TPP guaranteed POTUS Trump would exit NAFTA.

Why?  Because if the U.S. stayed in NAFTA the TPP nations would now have a collective backdoor into the valuable U.S. market through Canada.  The NAFTA fundamental flaw just became more flawed.

Mexico discovered the same.  China will talk expanded trade, but only on tiered terms. One tier with NAFTA (good stuff for Mexico); one tier without NAFTA (not as good for Mexico).

The $20 trillion U.S. market is what China wants access to; Xi Jinping doesn’t care about Canada or Mexico – beyond how each of them can benefit China’s products entering the U.S. market.

China plays a zero-sum game; if it doesn’t benefit China, it isn’t done.

So Justin from Canada now realizes he nailed his nations’ trade feet to ASEAN economies [sans Trump’s BFF golf partner Shinzo Abe (Japan)], who care about Canada as a door to the U.S. more than an actual trade partner.  FUBAR eh’?

Simultaneously, Justin from Canada still has red-face from Beijing burns and has to accept he just guaranteed: “no U.S. NAFTA deal is possible”.

Where does rainbow socks turn now…. India.  Except, well,… there’s a problem.

You see, while Justin from Canada was trying to find his way through the China, ASEAN and  TPP trade matrix, POTUS Trump and India’s Prime Minister Modi were hugging it out on trade deals; with U.N. Ambassador Nikki Haley courting the national Indian crowd.

Yup, Justin from Canada shows up in India, and the airport -much like the rest of the diplomatic venues- is empty.  POTUS Trump arrived early and stole all the trade hugging last year; then used a geopolitical strategy of punching Pakistan in the teeth to elevate his own Indian magnanimity.   A bazillion India peeps loves-them-some-Trump now.

More FUBAR eh’?

So Justin from Canada is traveling around India with his family and not getting any love.

Oh dear.

POTUS Trump began with China (Feb ’17). Outlines drawn. Handshakes. But he did so knowing he was dealing with Xi Jinping the dragon, not the panda.   Trump acted like he was accepting magnanimous panda, his granddaughter helped exhibit panda deference, but all while Trump was really viewing Xi with dragon-face.  Brilliant.

POTUS Trump then expanded economic influence through Saudi Arabia and the GCC creating new economic allies based on new definitions; and strategic security partnerships without the traditional U.S. cultural demands.  Stunning results ongoing.

POTUS Trump worked quickly through the economics of Europe gauging who was on-board and who was not.  France, Poland, Hungary all quickly joined up. Germany and the U.K. not-so-much… [Two visits to Macron and a reciprocal state visit soon] …Now go look at the economic results each EU state is facing; look who is winning.

POTUS Trump moved quickly on India as leverage with China trade discussions.  If China does stupid,… Trump hugs Modi tighter.   Trump kicks Pakistan in teeth with brutal truth over Afghanistan and their co-dependent enabling of Taliban.  Modi smiles bigger still.

POTUS Trump moved BIGLY in Asia.  Trump gave BFF Shinzo Abe first place. Japan has golden ticket to U.S. market based on reciprocity – everything is possible and Abe is on top of the world.  Trump knows China will *ONLY* do that which is in their interests… and he knows Xi Jinping needs the U.S. more than the U.S. needs China.  Worst part for Xi is he knows that Trump knows…

We always knew there was a generally good trade strategy visible from POTUS Trump, but it needs to be said that NO-ONE realized just how well thought out it really is.   Now I know what this guy does instead of sleeping… he maps out the matrix of trade leverage and economic strategy….. it’s almost absurd how keenly insightful Trump is on the geopolitical side of economics.

Our president has flaws and faults, we all accept that…. but he is engaging in international economics with a mastery never seen by a U.S. president.  EVER.

That truth is why the multinationals (corporations and banks) hate him so much, yet fear him a thousand times more.  If you doubt, or perhaps just need confirmation,  just look at what happened in Davos.

…“it is much safer to be feared than loved because …love is preserved by the link of obligation which, owing to the baseness of men, is broken at every opportunity for their advantage; but fear preserves you by a dread of punishment which never fails.”

~Niccolò Machiavelli, The Prince

Earlier today one of the more consequential meetings took place between President Trump and his economic team -vs- the professional UniParty apparatus consisting of multinational corporate-purchased Democrats and Republicans.

The policy discussion isn’t sexy or headline making from the perspective of the U.S. media; however, the resulting outcomes will have more of a bearing on you and your family than any other economic policy conflict in this administration.

On one side we have President Trump and a very focused policy and trade group containing Commerce Secretary Wilbur Ross, Treasury Secretary Steven Mnuchin and U.S. Trade Representative Ambassador Robert Lighthizer. On the other side the corporate UniParty apparatus consisting of U.S. Chamber of Commerce Republicans and Democrats.

An encapsulated view would be Main Street (Trump) -vs- Wall Street (UniParty).

.

This is THE battle. This is the “trillions at stake“. Everything else is chaff and countermeasures; a war is being waged around this financial issue. Everything within the current conflict is downstream from the economic argument around these issues.

This is the epicenter of the entire institutional conflict against President Trump. This is why THE SWAMP, through all its various affiliated and indulgent enterprises – including the intelligence apparatus, are waging a battle against the disruption that is President Trump.

It is the money.

Period.

[Transcript] THE PRESIDENT: Okay, thank you very much. I’m delighted to welcome both Republicans and Democrats. Nice sound. Isn’t that a nice sound? And we won’t be discussing DACA, but there’s plenty of discussion right now going on about DACA from both the House and the Senate, to the White House.

We’re here today to discuss a matter of vital importance to our nation’s economy and security, and I’ve been discussing it for years. And I’ve certainly discussed it in great detail on the campaign trail. That’s America’s aluminum and steel industries, and many other industries where we are taken advantage of by other countries. And I alluded to it yesterday, too.

Last year, I directed the Secretary of Commerce to investigate whether steel and aluminum imports are threatening to impair U.S. national security. You see what’s happened with our steel and aluminum industries. They’re being decimated by dumping from many countries, in particular one, but many countries. They’re dumping and destroying our industry and destroying the families of workers. And we can’t let that happen.

Secretary Ross submitted the result of the investigations to me last month. My administration is now reviewing the reports and considering all options. And part of the options would be tariffs coming in. As they dump steel, they pay tariffs — substantial tariffs — which means the United States would actually make a lot of money, and probably our steel industry and our aluminum industry would come back into our country. Right now, it’s decimated.

It’ll make a decision, and I will make a decision that reflects the best interests of the United States, including the need to address overproduction in China and other countries. You have countries that are so overproducing, and what they’re doing is they are dumping it on us. And you look at empty factories, steel factories, and plants, and it’s a very sad thing to look at.

I’ve been watching — I’ve been looking at them for two years, as I went around campaigning. No matter where you go, you look at them and see what happened to U.S. Steel and these other companies. They were the giants and now they’re hanging on for their life.

I look forward to hearing your views, and I’d like to have some of you speak. And you have very strong — I know, Roy, you do, and we all do, probably, have pretty strong views on this.

I look at it two ways: I want to keep prices down, but I also want to make sure that we have a steel industry and aluminum industry, and we do need that for national defense. If we ever have a conflict, we don’t want to be buying the steel from a country that we’re fighting because somehow that doesn’t work very well.

But we hopefully won’t have any conflicts, but we still have to consider that. And we have to look at the national defense, and we have to look at a steel industry. We cannot be without a steel industry. We cannot be without an aluminum industry. And so what we’re talking about is tariffs and/or quotas.

I think maybe, Roy, would you like to start? We’ve discussed this over the past. Do you have any suggestion?

SENATOR BLUNT: Well, Mr. President, I think we do need to be careful here that we don’t start a reciprocal battle on tariffs. You know, we make aluminum and we make steel in Missouri, but we buy a lot of aluminum and we buy a lot of steel as well —

THE PRESIDENT: That’s right.

SENATOR BLUNT: — from bass boats to beer cans. There’s a lot of aluminum out there. We’ve got an aluminum manufacturer that closed down, but with special electric rates is reopening under new management.

And so, clearly, we’re concerned about those new jobs, but also concerned about all the jobs — whether it’s in the electric steel area or the aluminum area, are very, very price sensitive here.

THE PRESIDENT: Good. And I understand that very well. One thing I just — I do want to tell you, we just got this notice. General Motors in Korea announces the first step in necessary restructuring. They’re going to — GM Korea company announced today that it will cease production and close its Gunsan plant in May of 2018, and they’re going to move back to Detroit.

You don’t hear these things, except for the fact that Trump became President. Believe me, you wouldn’t be hearing that. So they’re moving back from Korea to Detroit. They’re moving.

Also, you saw Chrysler moving from Mexico to Michigan. And you have many other companies. They all want to be where the action is. The big tax cuts had a big impact. And Kevin knows that maybe better than anybody. But it had a big impact on that decision.

But when you see that General Motors — we have a very bad trade deal with Korea. Very, very bad trade deal. It’s a deal that — it’s incompetent that somebody could have made a deal like that.

So we have a horrible trade deal with Korea. But now, even before we do something with that — because we’re negotiating the trade deal with Korea, and we’ll either negotiate a fair deal or we’re going to terminate the deal. But before we do that, already General Motors is coming back into Detroit. That is a really significant statement. Many others to follow from many other countries.

Mike, go ahead.

REPRESENTATIVE BOST: Mr. President, let me tell you that 2,800 people were laid off in my district in 2015, in a steel plant that’s been operating for over 100 years. The concern that we have is, is that steel plant produces what’s known as the oil country tubular goods — OCTG.

OCTG, when we’re doing the expiration, and everything like that, in oil that we are — but Korea has dumped 200 percent in the last year in an overabundance into that particular market. Because of that, we’re not able to get those 2,800 jobs back. And like I said, those have been there. That group of people there —

THE PRESIDENT: So where did it go? It went to Korea?

REPRESENTATIVE BOST: All of the products that — they’re even coming from Korea now that we’ve turned up. And unless we use the power under 232 — because if something goes south, now all of a sudden, while we’re trying to become energy independent — but these plants don’t turn up overnight, and we’ve got to try to do something to work for a long-term goal with that.

THE PRESIDENT: The Korean Agreement — as you know, Mike, and most of the people at this table — that was done by the last administration. It was supposed to produce 150,000 to 200,000 jobs. And it did — for Korea. For us, it produced nothing but losses. It’s a horrible deal. All you have to do is look at it. You know it’s going to be bad.

So the Korea deal was a disaster. It was supposed to be good for us, and it turned out to be very bad for us. And just — you know, you’re one example of it, but there are many examples all over the country. So I just think that General Motors moving back into Detroit is just a fantastic thing. That’s just a sign of many other companies to come.

Mike Pence, would you have something to say?

THE VICE PRESIDENT: Well, thank you, Mr. President. I just want to thank all of the Republican and Democrats taking time to be here and their profound interest in this issue.

To your point, this is about our economy, but it’s about national security. And the President directed a 232 review to determine whether or not our national security has been affected by the dumping of steel and aluminum.

And today, it is very much the President’s desire, our administration’s desire to hear from each of you and the perspectives that will also inform the decisions that the President will make.

I think that it’s fair to say that we all support national security. I think that’s evidenced by the recent budget agreement that the President helped drive, and Republicans and Democrats have supported, for a historic increase in our national defense.

But we also all support American jobs. And we very much look forward to your counsel as the President approaches this decision, and I appreciate the bipartisan spirit of this meeting and the conversation that will follow.

THE PRESIDENT: And really, as Mike said, I want to hear from both sides. We have a lot of great representatives, both Democrats and Republicans. I want to hear from both sides before we make the decision.

In one case, you’re going to create jobs. You may have a higher price or maybe a little bit higher, but you’re going to have jobs. In the other case, you may have a lower price, but you’re not going have jobs; it’s going to be made in China and other places. So those are big decisions. But, to me, jobs are very important.

Todd, do you have something to say?

SENATOR YOUNG: Mr. President, thank you for having us here today. I represent a state that is not only a major manufacturer of steel — we have U.S. Steel, Arcelor Mittal, and others who are manufacturing it — but we have the downstream users, which you alluded to. So, clearly, you understand the need to balance the two, to come up with a balanced approach here.

I think the main target — and I’ll just speak plainly with you, sir — should be China. They’re violating the international rules, stealing our intellectual property, overproducing steel products and other products. And —

THE PRESIDENT: We’ve spoken to them very, very strongly. We’ve told them. We have something coming up in the very near future that you know. But we have told them it just can’t continue.

We have a trade deficit with China — that I inherited, by the way — but we have a trade deficit of $504 billion, okay? So, if you think of it, when you look at how well they do, and how many bridges they’re building, and how many jets they’re building, and fighter planes — we did it. We did it. People that sat in my seat allowed them to do this.

So we’re not going to allow that. We’re talking to them right now, very strongly. And hopefully we’ll have a great relationship, but we’re talking to them very strongly, Todd. You’re right — it’s a big percentage of our deficits. And the money that we’ve lost and the jobs that we’ve lost to China, it’s unthinkable that people allowed that to happen.

And this is over a period — not just Obama. This is over a period of many years this has happened.

So thank you very much, Todd.

Pat, would you like to say something?

SENATOR TOOMEY: Sure. Thanks very much, Mr. President. I would just urge us to go very, very cautiously here, especially with section 232.

As you know, our defense needs consume about 3 percent of domestic steel consumption. So I think it’s implausible to believe that we’re not able to meet the needs of our defense industry, which is absolutely essential.

Imports in 2016 were 16 percent of domestic consumption. So the vast majority of the steel we consume, we in fact produce ourselves — which is the way I prefer it, and it is the case today. China was down to 2 percent of the 16 percent, so a very, very small portion.

My main message —

THE PRESIDENT: But they have transshipping.

SENATOR TOOMEY: Absolutely. So —

THE PRESIDENT: They would ship to other countries, and their steel would come in from other countries so that you can’t see where the steel is coming from.

SENATOR TOOMEY: Right. So what I would urge is, any country that is violating our trade laws and our trade agreements, go after them. Countervailing duty and the dumping, if that’s happening.

THE PRESIDENT: That’s all countries. That’s all countries.

SENATOR TOOMEY: But the 232 is a different matter, and invoking national security, when I think it’s really hard to make that case, invites retaliation that will be problematic for us.

THE PRESIDENT: Well, the word “retaliation,” Pat, is interesting. And I know you agree with this. We have so many countries where we made a product, they make a product, they pay a tremendous — we pay a tremendous tax to get into their countries — motorcycles, Harley Davidson — it goes into a certain country. I won’t mention the fact that it happens to be India, in this case. (Laughter.)

And a great gentleman called me from India and he said, we have just reduced the tariff on motorcycles, reduced it down to 50 percent — 5-0 — from 75, and even 100 percent. And we have — if you are Harley Davidson, you have 50 to 75 percent tax, tariff to get your motorcycle, your product in. And yet they sell thousands and thousands of motorcycles, which a lot of people don’t know, from India into the United States. You know what our tax is? Nothing.

So I say we should have reciprocal taxes for a case like that. I’m not blaming India. I think it’s great that they can get away with it. I don’t know why people allowed them to get away with it. But there’s an example that’s very unfair. And I think we should have a reciprocal tax.

That’s called fair trade. It’s called free trade. Because ultimately, what’s going to happen — either we’ll collect the same that they’re collecting, or, probably, what happens is they’ll end up not charging a tax and we won’t have a tax. And that becomes free trade.

So we have too many examples like that. And the word “reciprocal,” as Pat said — I mean, the world “reciprocal” is a very important word. We have countries that are taking advantage of us. They’re charging us massive tariffs for us to sell our product into those countries. And when they sell to us, zero. We charge them zero. We’re like the stupid people, and I don’t like to have that anymore.

So we’re going to change that, and we’re going to make it fair. And that, I call that fair trade. And, again, one of two things will happen. But I think what’s going to happen is they’ll just reduce their tax to the same as our tax.

Mike, would you like to say something?

SENATOR LEE: Yeah, sure. One of the things that worries me with regard to this proposed action is that there’s so many things manufactured in the United States; there’s so many jobs attached to so many things manufactured in the United States that use steel and aluminum as inputs.

Now in the case of steel, we’re talking about 16 percent that’s imported. But the availability of those imports and the absence of additional duties on those means that those goods can be manufactured and sold more cost effectively. That keeps a whole lot of people, including a whole lot of voters in each of our states — a whole lot in mine, certainly — in jobs.

And so, even though there may be some job winners from an action like this, I strongly suspect that, as has at times been the case in the past, you would end up with net job losses in the United States. And that’s what worries me here, particularly in light of the absence of what I can see as a real national security threat. Only 3 percent of what we’re able to produce domestically is what’s needed for our national security reasons, and I think that ought to be taken into account.

THE PRESIDENT: No, that number is going way up because of our big military spending now. You know we — something we all agree on. We had to do a lot of work on our military. Our military had not been taken care of properly, and now it’s being taken care of properly. So that 3 percent number will be going way up. But at the same time, it’s not a tremendous — you know, it’s not — as a percentage, it’s not a tremendous number.

I will say this: Steel and aluminum are interesting. It will create a lot of jobs. I believe that some of the dumpers will eat a lot of the tax themselves because they do it to keep people working. And we do it for that and other reasons.

But I will say that a finished product is a much simpler thing. As an example, Germany sends us cars. We send them cars; they practically don’t take them. I mean, how many Chevrolets do you see in the middle of Berlin? Not too many, folks. (Laughter.) Not too many. But they send Mercedes, they send BMW. They send them over here in tremendous numbers.

Japan sends us tremendous numbers of cars. They also make cars. In a way, there’s no tax. All they have to do, Mike, is, very simple — they do a factory here. There’s no tax. Now all of a sudden there’s no tax. So they’ll build factories here in order to avoid the tax.

But with cars, with television sets, with things like that, where they’re dumping them on us — we don’t make television sets anymore in this country. They come from South Korea, and they come from, to a lesser extent, Japan. Most of them come from South Korea. It’s not fair. And I believe that we should have reciprocal taxes on that, likewise.

That’s a different product, that’s a much simpler — you know, we did it with the washing machines, as you saw a couple of weeks ago. It’s had a huge impact on that industry. A huge impact. And, by the way, you know what’s happening? The people that made the washing machines outside of this country are now expanding their factories in the United States so they don’t have to pay the 25 and 30 percent tax.

And the same thing is happening with the solar panels. We’re starting to make — we had 32 companies. I think we’re down, Gary, to two, right? We made solar panels, but every one of our companies was wiped out. And I have to say this, and this is agreed to by — we made a much higher quality, a much better solar panel. We make them better, but we couldn’t compete. Now — and we’ve had a lot of good — a lot of places are opening up. They’re starting to make solar panels again.

So with a finished product, it’s a little bit different. But again, with steel and aluminum, which is what we’re talking about today — you know, that’s a good point, Mike. You’re right. The question is, would you rather pay a little bit more and create jobs all over the country? And it’s possible you won’t be creating — really, you won’t be having much of a problem in terms of pricing. Because I actually think a lot of the countries are going to eat it because they want to continue to, you know, export. And they’re making a fortune.

Look, we have rebuilt China. We have rebuilt a lot of — with the money they’ve taken out of the United States. We’re like the piggy bank that had people running it that didn’t know what the hell they were doing. And we have rebuilt countries, like, massively. You look at some of these countries — look at South Korea, look at Japan, look at so many countries. And then we defend them, on top of everything else.

So we defend Saudi Arabia. They pay us a fraction of what it costs. We defend Japan. We defend South Korea. They pay us a fraction of what it costs. And we’re talking to all of those countries about that because it’s not fair that we defend them, and they pay us a fraction of the cost of that defense. Separate argument, but a real problem.

Gary, would you like to say something?

MR. COHN: Senator Wyden, would you like —

THE PRESIDENT: Senator, go ahead.

SENATOR WYDEN: Thank you, Mr. President. We have Senator Brown, Senator Peters, Senator Casey. So you’ve got a good collection from the Finance Committee and the Commerce Committee.

I’ll just make two points really quickly, Mr. President. First, yesterday, you all released the infrastructure plan. And I looked at it very carefully, and I couldn’t see even any incentives, let alone requirements, to use American steel. Now, Senator Brown, I think, always says this is a great opportunity for bipartisanship. If we can work with you on that one, that ought to be a no-brainer.

THE PRESIDENT: We can. It’s a very easy one.

SENATOR WYDEN: And there’s one other thing, on that point, Mr. President. I’ll be very brief. And that is, actually, with respect to American steel, the way the plan reads now, it actually allows the states to walk back from commitments to use American steel. So point one would be, could we work with you on that?

Point two is, the Secretary and Ambassador Lighthizer have been very forthcoming in working with us. But we have been trying to see this 232 report. And we appreciate your asking us for our advice. We will need to see that report in order to give you more specifics. But I come back to Senator Brown’s point, I think there’s an opportunity for real bipartisanship here, and those would be two areas.

THE PRESIDENT: I agree. And I’d like you to come back with a suggestion on infrastructure and the plan. And I think that’s a bipartisan plan.

I will tell you, when I approved the two pipelines — the Keystone and — you know, we did the two big ones. And when I approved them, I said, “Where’s the steel being made?” And they told me a location that did not make me happy. And I wrote down that from now on steel is being made for pipelines — as you know, it’s got to be made in the United States. And it’s got to be fabricated in the United States. And so I’m a believer in that also.

But if you would come back with a suggestion, that would be great.

Bob, what about 232?

AMBASSADOR LIGHTHIZER: Well, I think we could put out the report. But rather than focus on that, let me just say, I want to, sort of, second what the Senator says. Trade has always been bipartisan in this country and just until the last few years. And I really think, with this and with NAFTA and the other things we’re doing, we can have Democrats and Republicans vote in large number together and start a new way to approach this.

That really is the point that I wanted to make. I think Senator Wyden and I think Senator Brown feels exactly —

PARTICIPANT: And Senator Casey.

PARTICIPANT: Can I speak on that, too?

THE PRESIDENT: Go ahead.

SENATOR BROWN: Thank you. I very much appreciate the work that Ambassador Lighthizer has done, generally and specifically, on 232. And Secretary Ross has worked on 232. And I want to talk for a moment about NAFTA. Not too much, but Ambassador Lighthizer has been so good on that.

I mean, trade, as he says, has always been nonpartisan. And I think good evidence of that is what Senator Portman, my colleague from Cincinnati — I’m from Cleveland — what we’ve been able to do together on Level the Playing Field Act; on trade remedy; on trade enforcement; on currency; and most recently, on Clyde, Ohio, on the washing machine case. And we appreciate what you’ve done here.

I sent the President and the transition staff — three days after the election, sent him a letter outlining what we can do together in trade. And the President — thank you — sent back a nice handwritten note about that. I appreciate working together on everything from TPP, to non-market economy status, to 232, to the washing machine case, to all of those issues. And I asked, in the washing machine case, it’s 3,000 jobs in a small town in Northwest Ohio, and an hour from Toledo. So that really matters to a lot of families.

I’m hopeful we can do quick action on 232. It needs to be comprehensive; aimed, as Todd said, certainly at China. But beyond China, 232 needs to apply more broadly.

And I also — I will just conclude that we can work on NAFTA together. Well, I will work if NAFTA is written in a way that supports workers, as I’m confident it will be, with Ambassador Lighthizer’s handprints on it, that we can deliver Democratic support. It will be bipartisan if done right. And that’s my reputation and that’s what I’ll continue to fight for.

And I know Senator Wyden, and Senator Casey, and Senator Peters are on board with that.

THE PRESIDENT: Good. I actually think that we can go bipartisan on infrastructure, maybe even more so than we can on DACA. Because the difference is we want to help DACA; you don’t. Okay? (Laughter.) I’m kidding. I’m sure you do. I hope we can.

By the way, while we’re at a table, I hope we can do DACA. That’s currently up. Everybody is in there working hard on it right now. I think we can have a chance to do DACA very bipartisan. I think that can happen, and I hope we’re going to be able to do that, Senator.

SENATOR BROWN: It’s important (inaudible).

THE PRESIDENT: And I think we will.

On infrastructure, which is the purpose of what we’re doing today, come back with a proposal. We put in our bid. Come back with a proposal. We have a lot of people that are great Republicans that want something to happen. We have to rebuild our country.

You know, I said yesterday, we’ve spent $7 trillion. When I say “spent,” and I mean wasted, not to mention all of the lives — most importantly — and everything else. But we’ve spent $7 trillion, as of about two months ago, in the Middle East — $7 trillion. And if you want to borrow two dollars to build a road someplace, including your state, the great state of Ohio — if you want to build a road, if you want to build a tunnel or a bridge, or fix a bridge, because so many of them are in bad shape, you can’t do it. And yet, we spent $7 trillion in the Middle East. Explain that one.

SENATOR BROWN: We’ll have a bipartisan — we have a bipartisan proposal.

THE PRESIDENT: We can do it fast.

SENATOR BROWN: With real dollars on it in infrastructure. We’re glad that (inaudible) —

THE PRESIDENT: We can do it fast.

SENATOR BROWN: — and work together on a real infrastructure bill with real dollars, plus what you can leverage in the communities and the private sector.

THE PRESIDENT: Right. Do a combination.

SENATOR BROWN: It needs real dollars.

THE PRESIDENT: I would love to have you get back to us quickly, because we can do this quickly. And we have to rebuild our country. We have to rebuild our roads and our bridges and our tunnels. So the faster you get back, the faster we can move. Focus on DACA this week, if you don’t mind. Right? But the faster you get back, the faster we move.

Jackie, you were going to say?

REPRESENTATIVE WALORSKI: Thank you, Mr. President. I’m grateful for you willingness to sit down, listen, and just talk today.

But I represent the recreational vehicle industry in northern Indiana, Elkhart County. We have 85 percent of that market. And I’m a defense hawk, I get what you’re saying, I get what we’re all saying around this table. We’re one of the largest manufacturing districts in this country.

And the problem is, right now, even the mere — when we look balance and we talk about balance, the mere threat of tariffs, right now, from some of my folks that are manufacturing right now — they employee some 15,000 people just in my district in Indiana. And a guy — one of my guys called me this morning, and he said, the mere threat of tariffs, right now, has already raised aluminum and steel costs by 25 percent. Canadian softwood has raised 20 percent. The labor cost to the industry is already up 10 to 15 percent because the job market is so tight.

And this is a market that was 21 percent unemployment when we really had the financial crisis in this country, and now we’re down to 2.1 percent. Their concern, my concern, is if we seriously have a balanced effort, and be able to keep and retain a momentum in a place like northern Indiana, and be fair at the same time, I am 100 percent supportive of what you do.

I would just ask that you look at that balance of what it’s doing to current employees and giant growth that our tax reform helped just two months ago.

THE PRESIDENT: But what you have to ask your manufacturers too —

REPRESENTATIVE WALORSKI: Sure.

THE PRESIDENT: — and I know some of those manufacturers. They were great to me.

REPRESENTATIVE WALORSKI: Absolutely, yeah.

THE PRESIDENT: And they’re friends. And they voted. And they — they’re great people. But you have to ask them one question. When you build your product and you send that big, beautiful product that they make like nobody else, and you send that to another country, how much tax does that other country charge them? And therefore, they don’t sell it there very much because the tax is so high.

And one of the things we want to do is we want fairness. We don’t want what’s been happening. Because you look at it and you do well here, but they come in and they compete with you, and we take their product for nothing. And you want to sell your product overseas — which is probably triple the market for you if you ever could get it. But a lot of manufacturers have given up. They’ve given up on that. They don’t even talk.

I will tell you, Harley Davidson — I was saying, well, what’s the story? They were saying it’s a 75 and 100 percent tax. They got used to it for so many years. For so many years, they weren’t even asking me to do this. I mean, I’m doing it for them and others, but they weren’t even asking because they’ve gotten used to it. And your folks have gotten used to it too. Because you take that great product and you sell it overseas, they make it almost impossible for you to do that — not only monetarily with the tax, but they also have other criteria which make it impossible.

REPRESENTATIVE WALORSKI: I understand. But I would say, Mr. President, there’s also the second issue that has developed in this country with these corporations in producing the quality of vehicles that they do is, the true-American smelters left. And in reference to the costs here, they won’t even fill the products of some of these customers because they don’t have to, because they got people standing in line to buy — there are so few, right?

THE PRESIDENT: Okay. Let’s —

REPRESENTATIVE WALORSKI: So if you can’t buy the specs, you’re out of a job.

THE PRESIDENT: No, I get it. We want a combination of big competition, including competition from within our country competing against that. And we want to take outside sources. But we want competition and we want the jobs.

REPRESENTATIVE WALORSKI: We want customer service.

THE PRESIDENT: And we want customer service. That’s right. Any questions?

Yes. Senator — Lamar.

SENATOR ALEXANDER: Mr. President, thank you so much for —

THE PRESIDENT: How’s healthcare going?

SENATOR ALEXANDER: Good. Thanks.

THE PRESIDENT: Good. That’s what I hear.

SENATOR ALEXANDER: Thank you for your support and for sticking with us. I talked to Senator Murray about it —

THE PRESIDENT: Good.

SENATOR ALEXANDER: — earlier, and we’re making progress.

THE PRESIDENT: Good.

SENATOR ALEXANDER: Thank you very much, and thanks to the Vice President for his work on that.

If I could use two 60-second stories just — I don’t know exactly what the tariff is proposed. And I thank you for having us down here before you’ve made your decision; that’s a big help. I thank you for that.

So here are the two examples: I hope you will look carefully at what President George W. Bush did in 2002 when he imposed 30 percent steel tariffs — 30 percent increase — on tariffs from China, South Korea, a couple of other places. The effect was, one, that even though that was only 5 percent of the imported steel, it raised the price of almost all steel in the United States.

Two, at the same time, auto-parts manufacturers who used the steel began to cut jobs and move outside of our country because they could buy the steel there, make the part, and ship the part back in without any tariff. And we found there were 10 times as many people in steel-using industries as there were in steel-producing industries. And so according to the auto manufacturers, they lost more jobs than exist in the steel industry.

So that’s — so the questions would be, will it raise prices —

THE PRESIDENT: Lamar, it didn’t work for Bush, but nothing worked for Bush. (Laughter.)

SENATOR ALEXANDER: Well, no, I wouldn’t–

THE PRESIDENT: It didn’t work for Bush but it worked for others. It did work for others. But you’re right, it did not work for Bush.

SENATOR ALEXANDER: Well, it’s a — I’m not recommending any solution. I’m just saying it’s worth looking at what happened because it backfired, raised prices, and lost jobs.

And then the other 60-second story is, my dad worked for Alcoa in the smelting plant in Tennessee. We don’t have smelting plants for aluminum anymore because you have to use a lot of electricity to make them, and they’re never coming back really. I think we only have six left.

So now we’re lucky enough there to be making auto parts from aluminum, for cars. Jobs are coming back up. But if we put a tariff on the ingots that come in from overseas, that will raise the prices and that will hurt. Our aluminum comes from Canada. None from China. So I hope you’ll look carefully at where the aluminum comes from.

THE PRESIDENT: Okay.

SENATOR ALEXANDER: So thank you very much for —

THE PRESIDENT: And you’re right. Now, I have to say this: Canada has treated us very, very unfairly when it comes to lumber and timber. Very unfairly. So we have to understand that. You know, it’s not just one thing or another. Canada has been very tough on this country when it comes to timber, lumber, and other things.

And they have not been easy when it comes to Wisconsin and our farmers. Because you try and ship product into Canada, if you’re a farmer — if you are a farmer up in Wisconsin and other places — you try and ship your things up to Canada, it’s been a very tough — it’s been a very tough situation for them, I will say that.

But I agree with what you’re saying. It’s very much a double-edged sword.

Ron.

SENATOR JOHNSON: Well, you mentioned Wisconsin, so —

THE PRESIDENT: Good.

SENATOR JOHNSON: — you understand that I was obviously manufacturing for 30-some years. And I’ve exported a lot of products though. The fact of that matter is, Mr. President, Wisconsin operates a trade surplus with both Canada and Mexico, because we not only export manufacturing products but also agricultural products. And trade works very well for Wisconsin.

I agree with the concerns that you just pressed, as well as the concerns of Senator Toomey and Senator Lee. What we have is the basic root cause of this problem is a massive overcapacity — primarily China, that’s true. How do you address that? And I think we need to be very cautious without raising increase — without raising prices.

Senator Alexander was talking about 2002. Spot prices increased somewhere between 69 and 82 percent. Producer prices went up from 19 to 27 percent.

Now, let me add just another dimension to this nobody has really talked about. We’ve talked about jobs; absolutely, we want the highest paying jobs. I think tax reform is going to juice the economy. And with such a tight labor market, I think wages are already increasing.

In Wisconsin, a big manufacturing state, in seven years I have not visited one manufacturer that could hire enough people. That was certainly my experience in the last 20, 25 years. For a host of reasons, we tell our kids you have to get a four-year degree. We pay people not to work. So we do need to be concerned about, in such a tight labor market, do we have enough workers in manufacturing.

So my final point is, it makes no sense for me to try and bring back high labor-content manufacturing to America. We need to do the value added things. And so I would just say, proceed with real caution there. Trade abuses — address those, attack those. Try and figure out how to address this massive over-supply in the steel industry, but do it very carefully, because we have experienced —

THE PRESIDENT: You’re right, Ron. I agree.

SENATOR JOHNSON: Okay.

THE PRESIDENT: I agree with you 100 percent. I do have to say that we do have a pool of 100 million people, of which some of them — many of them want to work; they want to have a job. A lot of them do better not working, frankly, under the laws. And people don’t like to talk about it. But you’re competing against government. And they have great potential. They sort of want to work, but they’re making less if they work than if they stay home and do other things.

So we have to address that situation. That’s a big problem.

But we have a pool of 100 million people, a lot of whom want to work. We will also have a much more merit-based immigration policy, where we’re going to bring in people that are going to be great workers, and they’ll really fill up Foxconn and all of the places. Like, I was very instrumental in getting you Foxconn, as you know, through my friendships with that great company. And they’re going to Wisconsin; it’s going to be incredible. They’re going to employ tremendous numbers of people. They’re going to build one of the biggest plants in the world. So it’s going to be very exciting.

But people will move there, but we do have a big pool of people that want to work, and they can.

Just to address the one other point — we have a trade deficit with Canada. We have a big imbalance of at least $17 billion. And with Mexico, we have an imbalance, we have a trade deficit of $71 billion, and I believe that number is really much higher than that.

I might ask Bob Lighthizer to just discuss that. But were you going to say one other thing, Ron?

SENATOR JOHNSON: Sure. Just as long as you brought up the whole immigration debate, there is absolutely no doubt that we have to fix our horribly broken legal immigration system. One of my proposals is literally a three-year guest worker visa program, managed by the states. Let the states determine what industries — they can set the wage rates, and they can completely control that process.

So I’m hoping, as part of this bipartisan process, that we actually fix our horribly broken legal immigration system so we do have the workers, and it has to be merit-based. So I ask my Democratic colleagues, please work with us, let’s fix the DREAMer problem, but let’s also fix our horribly broken legal immigration system.

THE PRESIDENT: Good. Thank you, Ron.

Yes, go ahead.

SENATOR CASEY: I just want to make a point about — back to 232. I’ll focus on steel 232 in Pennsylvania. In your opening, you talked about the job impact, as well as the national security impact, and I’m glad you raised both. I’ll just focus on national security.

In Western Pennsylvania, as well as in Eastern Pennsylvania, you have two examples among several. But the two are AK Steel in Western Pennsylvania. They are the last remaining manufacturer of electrical steel, meaning the steel that goes into our electricity grid. They’ve been hammered by this, as you know.

In the eastern part of the state, as Senator Young from Indiana mentioned, Arcelor Mittal —

THE PRESIDENT: They’ve been hammered by what?

SENATOR CASEY: Hammered by not having the remedy — the 232 remedy.

THE PRESIDENT: Okay.

SENATOR CASEY: To the extent that you can focus on that, I think the steel executives — the letter they sent you on the 1st of February, I think, outlines the problem. But this really is a national security issue.

THE PRESIDENT: Why didn’t the previous administration help the steel workers? Why didn’t the previous administration work on 232?

SENATOR CASEY: Well, look, I think there are a lot of us that had disagreements over the years, with the administration then, about being more aggressive on this issue.

THE PRESIDENT: Tremendous disservice.

SENATOR CASEY: I just hope that in this — I know it’s a 90-day period you’re in, but I hope you can promptly determine it.

THE PRESIDENT: Good. Thank you very much. I appreciate it.

Rob.

SENATOR PORTMAN: Mr. President, I agree with Bob that that’s a good example. AK Steel is the last electrical steel manufacturer; 101 percent increase over the last year in electrical steel coming into our country. It’s a small market, but it’s a critical market. They tell us that if they don’t get relief, they’re going to pull out of this business, so we won’t have the steel that goes into our transformers and our grid.

And so I think it is a good example. But what I would say, sir — and we’ve talked about this before — any response here needs to be targeted, and electrical steel is the place to target it. The other place, I think, is the oil country product that was talked earlier. This is pipe and tube. Eighty-two percent increase there. And, frankly, most is coming from Korea, and Korea doesn’t have a single rig. In other words, they’re taking Chinese steel for the most part, and it’s, in effect, transshipping it to us.

THE PRESIDENT: They’re doing a lot of transshipping.

SENATOR PORTMAN: And that’s hurting our ability to continue to have this energy independence we talked about.

So those are two specific areas where I do think that there’s an opportunity to do something and to use 232, which is a national security, as opposed to 201, which is what President Bush used.

But let me tell you, with regard to rolled steel and with regard to other products, as Senator Brown said, we’ve had some pretty good success by going after them with regard to unfair trade practices. And that’s the Level the Playing Field Act, which is just now being implemented. And as I told you before, I think even stronger enforcement of that would be great because that will enable us —

THE PRESIDENT: Well, they had little enforcement before. We’re very strongly enforcing it now. And, Wilbur, you might want to talk about that. But we are very strongly — but they have had not good enforcement previous to this.

SENATOR PORTMAN: And the second part of this — and you’re right — is with regard to the Enforce Act. And that’s — and again, Ron Wyden and Senator Brown and I and others have worked on this. But what it says is that if a country transships — in other words, sends their steel, say, to Malaysia, which we believe happens with regard to Chinese steel, puts a different stamp on it, “Made in Malaysia,” and then sends it here — we need to be more aggressive in going after them. And it’s just a matter of Customs and Border Protection having so many other responsibilities right now.

But we can do more with our existing laws as well. And I think 232 is part of the overall response, but it needs to be targeted. I agree with what Senator Alexander and others have said about the balance, Senator Toomey and others. You got to be careful because we don’t want to increase the cost to our consumers of all these steel products that go into our other manufacturing. But there are areas, like electrical, like pipe and tube, where we’ve got to stand up and help to defend, in the case of electrical, our last American manufacturer.

THE PRESIDENT: Right. Well, you know, Rob, we have steel coming into our country from countries that don’t even know what steel is. They don’t make it, they never made it. It’s transshipping. It’s coming from China and some others, but mostly from China. And they send it through countries that don’t make steel, and it comes pouring into our country — and free. Free. And it’s a very bad — very bad situation.

Kevin.

REPRESENTATIVE BRADY: Yeah, so, one, I think everyone in this room supports you aggressively holding China accountable for its overcapacity in a major way. Thank you for that.

232 is a little like old-fashioned chemotherapy. It isn’t used as much because it can often do as much damage as good. And an example — it happens all around the country — but we send steel pellets from Corpus Christi over to Austria, to this company that does this amazing job — super-refined, specific job.

We bring it back to Navasota, Texas — my district — refine it even further. Sell it to many American energy companies who use that specialized steel to compete and win against Russia and China and all the other countries. If transactions like that, that are pretty typical around the country, get caught up, in that case we punished three American manufacturing industries for that, all of whom, by the way, are looking at expanding because of your tax reform plan.

THE PRESIDENT: That’s right.

REPRESENTATIVE BRADY: And so my point is — so we have to be really targeted. You have to be really targeted here. Also, we’ve got allies with us against China’s unfair trade practices. We have to be careful, as you look at these decisions, to target it, to make sure our allies are with us as we do this.

THE PRESIDENT: Okay. Very good. Thank you, Kevin.

Go ahead, Rick.

REPRESENTATIVE CRAWFORD: Thank you, Mr. President. One thing I want to point out — we had the conversation about the national security imperative, and I think we’ve looked at it in the context of the defense industry.

And I just wanted to add one thing to that: It’s our ability to address our own inputs — not just addressing the needs of the defense industry, but our ability to produce for our own consumption as we take on infrastructure projects and so on.

THE PRESIDENT: Right. That’s right.

REPRESENTATIVE CRAWFORD: So I think we don’t just need to focus on those percentages but also, broadly, how this impacts our ability to provide for our own inputs.

And then, one other thing I wanted to mention is, 74 percent capacity right now here in the United States. The steel industry is losing market share, and that translates to —

THE PRESIDENT: Rapidly.

REPRESENTATIVE CRAWFORD: — economic loss in communities, as Representative Bost — he and I co-chair the steel caucus, and so we’re very keenly aware of what this can do to these communities when we don’t have that kind of certainty.

THE PRESIDENT: Good. Thank you, Rick. Thank you very much.

Senator.

SENATOR PETERS: Hello, Mr. President. I appreciated your comments about Michigan and the auto industry. I’d like to say that a big reason why those jobs are coming back is because we have the best workers anywhere in the world here.

THE PRESIDENT: Well, that’s also true. I agree.

SENATOR PETERS: That’s why we’re here. And they can build it on time and build it with outstanding qualities, as long as the rules are fair.

So I appreciate this issue. And it should be —

THE PRESIDENT: You do have great workers. The problem is you didn’t have good policy, and that’s why so many jobs left. But now they’re coming back. And they like coming back to Michigan.

SENATOR PETERS: Well, they’d love coming back to Michigan, as long as we have fair rules and —

THE PRESIDENT: Right.

SENATOR PETERS: — so have to continue to push this forward.

I would like to pick up on Senator Alexander’s comments, too, is that we also have to be concerned about the auto parts industry as well.

THE PRESIDENT: Right.

SENATOR PETERS: We have probably more jobs in auto parts in Michigan than any other of the industrial sector, so they all go together.

We’ve got to deal with the steel pricing issue. I agree with everything that’s been said here. But then we can’t have the dumping of auto parts that will take away Michigan jobs as well as jobs around the country.

THE PRESIDENT: You’re right.

SENATOR PETERS: And if I could just bring up one other issue that I think we should take a look at. I’m working in a bipartisan way with Senator Burr on an issue related to the Commerce Department having the ability to self-initiate trade enforcement actions smaller than industries like steel or aluminum or washing machines — is that we have small businesses that don’t have the resources, quite frankly, to bring a trade enforcement case —

THE PRESIDENT: Good point.

SENATOR PETERS: — to go through the lawyers to do that. In Michigan, for example, we have cherries. Right now, we’ve got the dumping of cherries that’s making it very difficult for our growers in Michigan. But they don’t have the resources to bring those kinds of enforcement actions.

So we’re working on legislation to give Secretary Ross, the Department of Commerce, more tools to help our small businesses.

THE PRESIDENT: I like that.

SENATOR PETERS: And I’d love to have your help.

THE PRESIDENT: You have my help. I think it’s a fantastic idea. Because you’re right — they can’t hire the lawyers, it’s too small. But it’s — you know, in a double way, it’s very, very big.

Wilbur, are you working on that?

SECRETARY ROSS: Yes, sir.

THE PRESIDENT: Good.

SECRETARY ROSS: As you know, for the first time in many years, the Commerce Department did initiate — self-initiate — it happened — it was in a big industry. It was in aluminum.

But there are limitations to what a conventional trade case can do, and the main limitation is it doesn’t prevent people from the trans-shipment through other countries. And of lot of what 232 can do for us is to solve that problem.

And 232 doesn’t have to mean the same tariff on every single country. It doesn’t have to mean the same tariff on every single product. It can be applied in a much more surgical way. And we presented the President with a range of alternatives that goes from a big tariff on everything from everywhere, to very selective tariffs from a very selective group of countries.

There are one of two countries that figure quite prominently in all of the lists, and those names will come as no surprise to you. But, for example —

THE PRESIDENT: And the problem you have with that, though, is transshipping.

SECRETARY ROSS: Yes.

THE PRESIDENT: You think you’re going to put a pinpoint on a country, but then they ship it to other countries that you’re not even thinking about.

SECRETARY ROSS: Right. And so —

THE PRESIDENT: So you have to be careful with that.

SECRETARY ROSS: Yeah. So what the 232 would let us do is to have quotas on the countries that we weren’t putting a tariff. (Inaudible) at what they’re shipping in now. So it’s not going to restrict supply, but it would prevent the evildoers from transshipping more goods through that country.

THE PRESIDENT: Evildoers. That’s a good word. Of which there are many. (Laughter.)

SECRETARY ROSS: Yes, there are — there are, Mr. President.

THE PRESIDENT: You’re doing a good job, Wilbur. Thank you.

SECRETARY ROSS: Thank you, Mr. President.

THE PRESIDENT: We’ve been very — we’ve been tough.

Go ahead. Fellas.

REPRESENTATIVE JOHNSON: Mr. President, the comments that have been made here — been made today about balance is absolutely essential. I mean, managing job creation and controlling cost at the same time has got to be the major factors in this mix.

Two points that I’ll make.

THE PRESIDENT: And deficits too? Deficits too?

REPRESENTATIVE JOHNSON: Absolutely.

THE PRESIDENT: You know, there are some people who don’t believe in deficits. They think it doesn’t matter. To me, I think it matters a lot.

REPRESENTATIVE JOHNSON: I think it matters a lot.

Two points that I’ll make. One, to, kind of, put a stamp on what Senator Portman said, AK Steel is the only manufacturer in America that makes the electrical steel that is necessary for the transformers that feed and produce electricity in our electric grid. China — we are at risk of losing that industry; and if we lose that, we are absolutely, potentially at hostage by the Chinese for management and maintenance of our electrical grid.

Number two, you’ve made a big case, and I think you have, rightfully so, told the world that America is open for business. And the regulatory reforms that you’ve done, the tax reforms that you have done, has put America back in business.

One of the biggest businesses that is promoting job creation today is the oil and gas industry.

THE PRESIDENT: Right.

REPRESENTATIVE JOHNSON: And in Eastern and Southeastern Ohio, big projects like ethane cracker plants, they require a tremendous amount of steel.

We’ve got to make sure that whatever we do in this formula keeps cost down because those projects are huge. I mean, they are massive. You’re talking about $6- to $8-billion projects, and big cost increases in steel could be a big deal.

So we got to balance the job creation with the cost.

THE PRESIDENT: I agree. I agree. And I know that area very well. You’re right.

Yes.

REPRESENTATIVE SMITH: Thank you, Mr. President. At home in Southeast Missouri, we have a real example of where we lost 900 jobs in March of 2016 because our aluminum smelter closed. And I believe that these aluminum smelters can be reopened.

I don’t fall underneath the premise —

THE PRESIDENT: And for a different reason, too. Because of what we’ve done, our energy prices are going so low, our electric costs are going so low, that other countries aren’t going to be able to compete with us. We’re really doing a great job of bringing them down. And a lot of that had to do with the tax cuts, but it has to do with lots of other things, too.

REPRESENTATIVE SMITH: Exactly.

THE PRESIDENT: Go ahead. Tell me about that.

REPRESENTATIVE SMITH: When you look at Southeast Missouri, the median income household is $40,000. It’s one of the poorest congressional districts in the country. And when we lost 900 jobs, with the average salary of $70,000 a year, that hit home in the Bootheel of Missouri.

And without a doubt, if you just look at the numbers of the aluminum production in China that in 2000 was 10 percent of the world’s production, and in 2015 was 54 percent, there’s a problem, Mr. President. And I believe that we can have the production back, and we have a vacant facility in New Madrid, Missouri that we want to open, and we want to create more jobs.

And I applaud you for looking at 232, and looking at a reasonable approach to make sure that we’re open for business in all industries, not just one.

THE PRESIDENT: Well we all have to remember that there is no tax or there is no tariff, if they come in and build plants in this country. So there is no — we’re just talking about something, but there is nothing.

Steel is a little bit different than a car. It’s a little bit different than a washing machine or any of the other things that we’re doing or talking about doing. But nevertheless, you build your factory, you build your plant in the United States, there is no tax. So that’s a big difference. That’s why I think you’re going to see General Motors — they’re coming back. A lot of companies are coming back, and they’re coming back to areas that you represent. It’s a good feeling. That’s a really good feeling.

Maybe I’ll just have Bob finish up. Do you want to do that? Roy, were you going to say something real fast?

SENATOR BLUNT: I was just going to say, like the AK Steel, we need to be very careful here. There is only one American producer, but there are lots of American buyers. Those electric motors in the washing machine, the generators, the grid — all of that is dependent, currently, on a lot of electric steel coming from somewhere else.

I think the balance of keeping that company in business —

THE PRESIDENT: It’s a good balance.

SENATOR BLUNT: — while you keep all these other companies — it’s going to take a long time to either expand or have more competitors here. So we need to be very thoughtful about all the other buyers of that product that has only one American source. So it is a great example, but it’s a great example to remember that washing machine motor, as well as all the other things that electric steel is used for, sir.

THE PRESIDENT: That’s a good point. The word “balance” is a very important word.

SENATOR BROWN: Can I add one other point —

THE PRESIDENT: Yes, go ahead.

SENATOR BROWN: — taking off on what Roy said. As you apply — as you and Secretary Ross apply 232 — and I understand the cautionary notes from some of my colleagues — I think it’s important that we always keep in mind China’s excess capacity. And China’s excess capacity doesn’t mean you aim 232 just at China. Because China’s excess capacity, as you point out, is spread elsewhere. And the best example was your comment on oil country, tubular steel through Korea. As Rob said, Korea doesn’t drill itself. It’s just the pass-through point.

But because China’s excess capacity has, in some ways, affected steel production — or steel sales, not production — throughout the world, it’s important that 232 be aimed at China’s excess capacity and countries all over the world.

THE PRESIDENT: Right. I agree with that. Maybe you could just — a very brief discussion of where you are with NAFTA. Because this is the group that is very interested in NAFTA.

AMBASSADOR LIGHTHIZER: Well, I’ve spoken to some of these members here. And, Mr. President, I think we’re making progress on NAFTA. There was a lot of anxiety at one point as to whether or not we’d be in a position where would have to withdraw in order to get a good agreement.

Our view is, number one, that NAFTA has not served the United States well in all respects. It has served some people very well, but other people and overall it has not done a good job. I think we’re making real headway. I feel like, particularly with respect to the Mexicans, that we are making headway. We have a number of issues that we still have to work our way through, but I’m hopeful that we’ll be in the positon — I think that most important — to get a good deal, one that you’ll find acceptable.

But most importantly, I want it to be an agreement that the vast majority of Republicans and Democrats support. I think this is very important that we have a new paradigm in steel, that we get 20 or 25 Democrats in the Senate and a large number of them in the House to vote for this deal, as well. Of course (inaudible) and I think that’s very much in reach; it’s something that we can do.

THE PRESIDENT: Well, I want to thank everybody very much. I really would like to see you come back with a counterproposal on the infrastructure. I think we’re going to get that done. I really believe that’s — we’re going to get a lot of Democrats; we’re going to get a lot of Republicans. We’re going to get it done. It’s something we should do. We have to fix our country. We have to fix our roads and our tunnels and bridges and everything.

So, if you can, work together on that. And I am ready, willing, and able. It’s very important.

And then, of course, this week I know you’re working very hard on DACA. Everybody in the room wants DACA. And let’s see if we can get that done, and it would be a great achievement. They’ve been talking about it for many years, and, if we could do it, it would be a great achievement. And it would be something — on a humane-basis, would be excellent.

So I want to thank you all for being here. If you have any suggestions, call me, call Gary, call Wilbur, call Bob. But I very much appreciate you being here. And if it’s necessary, we’ll have another meeting to iron out some points.

But on infrastructure, that is such a natural for us to get done, and I think we can probably do it.

Thank you all very much. Thank you.

[End Transcript]

Hopefully everyone will note in the discussion above that our allies are NOT the republicans in attendance.  Every one of the Republicans was arguing the position of the multinational corporations.  As much as Democrats are on the wrong side of multiple issues, on the trade front the smart Democrats become MAGA allies; and the Decepticons become our adversaries.

Roy Blunt, Mike Lee, Ron Johnson, Pat Toomey, Lamar Alexander and all the GOPe crew are purchased by the multinational interests of BIG Corporations (the U.S. CoC).  They are the duplicitous enemy of the American heartland.

Eyes Wide Open !

It’s all right there to witness.

Earlier today President Trump hosted a White House discussion meeting to outline an infrastructure initiative with state and local leaders.  The initiative is part of a $1.5 trillion proposal to join with federal, state, local and private investment toward rebuilding American critical infrastructure, roads and bridges.

[Via White House] BUILDING AMERICA’S INFRASTRUCTURE: Today, President Donald J. Trump released his legislative goals to rebuild our Nation’s crumbling infrastructure. The six principles include:

• $200 billion in Federal funds to spur at least $1.5 trillion in infrastructure investments with partners at the State, local, Tribal, and private level.
• New investments will be made in rural America, which has been left behind for too long.
• Decision making authority will be returned to State and local governments.
• Regulatory barriers that needlessly get in the way of infrastructure projects will be removed.
• Permitting for infrastructure projects will be streamlined and shortened.
• America’s workforce will be supported and strengthened.

STIMULATE INFRASTRUCTURE INVESTMENT: President Trump’s plan will lead to at least $1.5 trillion in investments to rebuild our failing infrastructure and develop innovative projects.

• $200 billion in Federal funds will spur at least $1.5 trillion in new infrastructure investments.
  • Federal infrastructure spending will promote State, local, and private investments and maximize the value of every taxpayer dollar.
• Of the $200 billion, $100 billion will create an Incentives Program to spur additional dedicated funds from States, localities, and the private sector.
  • Applications for the Incentives Program will be evaluated on objective criteria, with creating additional infrastructure investment being the largest factor.
  • The Incentives Program will promote accountability, making Federal funding conditional on projects meeting agreed upon milestones.
• $20 billion will be dedicated to the Transformative Projects Program.
  • This program will provide Federal aid for bold and innovative projects that have the potential to dramatically improve America’s infrastructure.
  • The program will focus on projects that could have a significant positive impact on States, cities, and localities but may not attract private sector investment because of the project’s unique characteristics.
• $20 billion will be allocated to expanding infrastructure financing programs.
  • Of the $20 billion, $14 billion will go to expanding a number of existing credit programs: TIFIA, WIFIA, RRIF, and rural utility lending.
  • $6 billion will go to expanding Private Activity Bonds.
• $10 billion will go to a new Federal Capital Revolving Fund, which will reduce inefficient leasing of Federal real property which would be more cost-effective to purchase.
• A new fund will allow some incremental revenues from energy development on public lands to pay for the capital and maintenance needs of public lands infrastructure.

INVEST IN RURAL AMERICA: Rural America’s infrastructure has been left behind for too long, and President Trump’s plan will make sure it is supported and modernized.

• $50 billion of the $200 billion in direct Federal funding will be devoted to a new Rural Infrastructure Program to rebuild and modernize infrastructure in rural America.
  • The bulk of the dollars in the Rural Infrastructure Program will be allocated to State governors, giving States the flexibility to prioritize their communities’ needs.
  • The remaining funds will be distributed through rural performance grants to encourage the best use of taxpayer dollars.

INCREASE STATE AND LOCAL AUTHORITY: President Trump’s proposal will return decision-making authority to State and local governments, which know the needs of their communities. 

• Funds awarded to State and local authorities, such as through the Incentives Program and the Rural Infrastructure Program, will be allocated to infrastructure projects they prioritize.
  • This empowers States and localities to make more infrastructure investment decisions and prioritize projects based on the needs of their communities
• The plan will expand processes that allow environmental review and permitting decisions to be delegated to States.
• The plan will also allow Federal agencies to divest assets that can be better managed by State or local governments or the private sector.

ELIMINATE REGULATORY BARRIERS: The President’s plan would eliminate barriers that prevent virtually all infrastructure projects from being efficiently developed and managed.

• The President’s plan will:
  • Provide more flexibility to transportation projects that have minimal Federal funding but are currently required to seek Federal review and approval.
  • Incentivize the efficient development and management of water infrastructure, in part, by providing more flexibility to the U.S. Army Corps of Engineers and its partners.
  • Give the Department of Veterans Affairs the flexibility to use its existing assets to acquire new facilities by allowing it to retain property sale proceeds and exchange existing facilities for construction of new facilities.
  • Expand funding eligibility for land revitalization projects through the Superfund program and establish tools to help manage their legal and financial matters.

STREAMLINE PERMITTING: President Trump’s infrastructure proposal will shorten and simplify the approval process for infrastructure projects.

• Working with Congress, we will:
  • Establish a “one agency, one decision” structure for environmental reviews.
  • Shorten the lengthy environmental review process to two years while still protecting the environment.
  • Eliminate certain redundant and inefficient provisions in environmental laws.
  • Create two new pilot programs to test new ways to improve the environmental review process.

INVEST IN OUR COUNTRY’S MOST IMPORTANT ASSET – ITS PEOPLE: The President is proposing reforms so Americans secure good-paying jobs and meet the needs of our industries. 

• The President’s plan would reform Federal education and workforce development programs to better prepare Americans to perform the in-demand jobs of today and the future.  This includes:
  • Making high-quality, short-term programs that provide students with a certification or credential in an in-demand field eligible for Pell Grants.
  • Reforming the Perkins Career and Technical Education Program to ensure more students have access to high-quality technical education to develop the skills required in today’s economy.
  • Better targeting Federal Work-Study funds to help more students obtain important workplace experience, including through apprenticeships.

(White House Link)