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- [00:00]
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- [01:01]
Jamison Greer
Bloomberg Audio Studios Podcasts Radio News Let's Turn to Tariffs
- [01:08]
Bloomberg Host
the big story the President doubling down on his trade agenda.
- [01:12]
President of the United States
An unfortunate ruling from the United States Supreme Court. Almost all countries and corporations want to keep the deal that they already made. The legal power that I as president have to make a new deal could be far worse for them.
- [01:28]
Bloomberg Host
The President pledging to use alternative legal authorities to impose new duties following the Supreme Court's ruling against the tariff agenda. I'm very pleased to say the Making some time for us this Morning is the U.S. trade Representative, Jamison Grier. Ambassador Greer, welcome to the program, sir. We need to spend some time with you talking about the next year, particularly the next 150 days. But there is some intrigue over the last week. Let's talk about the last week and particularly on Friday. The There is now a new baseline tariff of 10%. Why did we start with 10% when the President appears to want 15?
- [02:01]
Jamison Greer
So the authority that we're using right now, which is a temporary 150 day authority, that's five months, 150 days. And we have a lot of countries out there that for a long time have had 10%. We have some that have higher at 15%. And so our goal with all of this is to have continuity. So we want to have the 10% and it'll and we're looking about how to implement the 15% that the President indicated because we want to have continuity. We want the countries, we want the companies, we want people to understand that what we were doing before we're going to reconstruct with alternative tools because we want to keep going, maintain the policy, we'll just have a change in the
- [02:40]
Bloomberg Host
legal implementing authority giving me the impression that this is still under conversation negotiation, perhaps internally, when the President was pretty explicit over the weekend in his own words, as the President of the United States of America will be effective immediately raising the 10% worldwide tariff on countries, many of which have been ripping the US off for decades, without retribution to the fully allowed and legally tested 15% level. How can we sort of explain that which is rather explicit with the more nuanced tone you're offering this morning.
- [03:10]
Jamison Greer
So we'll put out a supplemental proclamation that the President will sign going to 15% where appropriate. Remember, before the Supreme Court struck down the tariffs, a lot of these countries had agreed to have tariffs, U.S. tariffs on them of 18%, 19%, 20%. So going up to 15% for them, at least temporarily, it's better than the deal that they had. And so the President wants to make sure again that we have continuity in this process, that folks who acknowledge they had giant trade surpluses with us, they had unfair trading practices affecting their trade and who agreed, agreed to pay the tariff, that they actually are in a position to do it until we can get the, the more durable and long lasting measures in place.
- [03:51]
Bloomberg Interviewer
Ambassador Green, when you say when appropriate, is that this week, are you looking to do this after the 150 days runs out of the 10% level we currently.
- [04:00]
Jamison Greer
Oh, it'll, it'll be, it'll be in coming days. It's soon. Right. I mean the President put out this direction to your point and so that all of that is in development. So that will be soon. Again, the idea is to establish a through line from the policy that, that the President has implemented successfully over the past year and continue it over this 150 days and as we build up appropriate tariff rates using other, other investigations and means.
- [04:24]
Bloomberg Interviewer
So when you do raise the 122 tariff to 15%, what's your argument going to be to the Europeans? Because this is stacking on top of most favored nation rates. That means that for the Europeans that agreed on a 15% the highest level, they would agree to accept this new rate for some products will be above 15%. What's going to be the argument to Brussels?
- [04:48]
Jamison Greer
So, so I've been in constant contact with, with my counterparts in Brussels, the UK and elsewhere. And the way to think about this is every country has domestic procedures that they need to, to come into compliance with a deal with Brussels. We gave them a good rate on cars. That stays the same with, with the UK We Gave them a quota on cars, we gave them a quota of beef to import duty free. That stays the same. So a lot of these parts stay the same. But just like Brussels hasn't fully implemented its deal, or the UK hasn't fully implemented its deal, we also need a couple months now to have some domestic procedures because the Supreme Court struck down all of this. It's pretty normal when you have a trade deal to implement over time. Most trade deals take years to implement. We're on the fast track and so we're just going to have to have, you know, a couple, three months to make sure that we rejigger the tariffs in a way that comply with our end of the deal. And we expect the EU and the UK to hold up their end of the bargain too.
- [05:43]
Bloomberg Interviewer
But does this new 120 to 15% now basically break the EU trade agreement given where most favored nation products are and those rates?
- [05:52]
Jamison Greer
So right now, as we talked about 10% in place, there will be a proclamation raising it to 15% percent where appropriate. And so once that comes out, I'm happy to come back on and explain how that, how that might accommodate other countries where there's a deal.
- [06:06]
Bloomberg Interviewer 2
Well, any of the rates on any country stay at 10%.
- [06:11]
Jamison Greer
Well, we want to make through that. We go through the legal process and we get out a proclamation. Again, this is any time we put on a tariff, we're going to have foreign interests who want to, who want to bring it down. So people are going to sue us. So I'm not going to get ahead of the President, I'm not going to get ahead of the White House counsel and all these folks who are implementing this. So when that comes out, it'll be very clear what and how and why.
- [06:34]
Bloomberg Interviewer 2
Ambassador, in some of your comments, it seems like you're suggesting that the rate could go above 15%. And I just am curious what exactly you're planning to use. It's been discussed that section 301 in particular will be used to go after places like China, which it has been used for before. Is that still in the cards?
- [06:52]
Jamison Greer
Yes. So section 301 is a country specific tool and it allows the President to investigate unfair trading practices by countries. And again, this is what we've been getting at over the past year as we've concluded deals with with over a dozen countries. They have agreed to eliminate unfair barriers to our trade, take down their tariffs, you know, eliminate, you know, fake regulatory barriers, etc. And so we can actually conduct these investigations under section 301 on a country by country basis, figure out exactly what they're doing that's been so problematic, and negotiate with those countries, but also impose a tariff as enforcement to make sure that they eliminate those practices. You know, China certainly, but also other countries, Vietnam, Southeast Asia, the Europeans potentially. But the point is to recreate the policy that we've developed over the past year to give continuity and be able to be in a position where we can honor the deals but also have enforcement available. That's the only reason why these countries have made all these concessions, because they know the President's willing to enforce and willing to raise tariffs if he needs to.
- [07:59]
Bloomberg Interviewer
Have you started three on one investigations?
- [08:02]
Jamison Greer
So there are a couple that are, that have already started. We opened a Section 301 investigation on Brazil a few months ago. We opened up one on China a few months ago about compliance with the Phase one deal. And we have many others that we are preparing right now and we expect to launch in the coming days and weeks, such as related to forced labor in supply chains, industrial excess capacity, or unfair trading practices with respect to fish or seafood or rice, or, you know, subsidies for certain products and that kind of thing.
- [08:32]
Bloomberg Interviewer
So you were potentially Planning to use 301 because when I spoke to you and your colleagues in the past, there was this concern, Supreme Court could strike down ipa. So why didn't you do these investigations from the very beginning, IPA was the
- [08:46]
Jamison Greer
most appropriate tool to use because we are facing an emergency in this country. In the five years prior to President Trump's second term, our U.S. trade deficit expense exploded by 40% to reach $1.2 trillion, the largest trade deficit in human history. And the trade deficit was a manifestation of many things, but one of them is a lot of offshoring of production to other countries, jobs and manufacturing that went to China, Vietnam, Mexico, et cetera, to the point where our defense industrial base was challenged. Our manufacturing base and jobs were hollowed out. And this was an emergency and is an emergency. And so the President used an emergency power to move very, very quickly. Section 301 and section 200, some of our alternative tools, they take more time, they take more process, they're very effective, but they didn't have the flexibility and the speed we needed to really out the gate, make these points, get the deals with the countries, and now we can go back and make them firm.
- [09:40]
Bloomberg Host
Ambassador? Canada and Mexico, of course, will be down separately. But does the President feel constrained by usmca?
- [09:48]
Jamison Greer
So I wouldn't say feel, feel constrained. We're in the middle of a, of a, of A review that we have to conduct in the United States. I'm in contact with my counterparts from both Mexico, Mexico and Canada. There are things in USMCA that make sense that, you know, don't get a lot of news because they function fine. But there are a lot of things where we don't have the type of market access we want, whether it's in goods or services. We have Mexico that historically over the past few years has been discriminating against US Energy producers and service providers. We have Canada that limits our access for dairy has, has taken American wine and spirits off its shelves. So we have a lot of issues like that. We also have concerns about trans shipment through Canada and Mexico of goods from third countries coming through and benefiting from duty free treatment from usmca. And so we want to make sure that if there's an agreement with either of these countries that it really benefits these countries and not third countries that might use Canada or Mexico as an export hub into the United States.
- [10:44]
Bloomberg Host
I'm sure you followed the story. Josh Wingrove and the team down in Bloomberg News in Washington D.C. reporting more recently that the President is privately musing about exiting the North American trade pact. What can you share with us this morning about the prospect of that happening?
- [10:57]
Jamison Greer
Well, it's not just privately. He talks about it publicly too. It's not a secret. I don't think that's super newsy, to be honest. The President has been really clear this year that he's concerned with the performance of usmca. He doesn't feel that we should just rubber stamp this agreement. I'm having separate negotiations with Canada, Mexico because our relationships with those countries are so different. And so I think we'll have over the, over the coming year conversations, maybe we'll have separate protocols with Canada and Mexico that we tack on to usmca. We just have to fix some of the gaps in that. The President has already taken action on autos, which is a big problem. We've seen a huge influx of imports of autos from Mexico over the past few years when really we want to be making those things here. And we're already seeing Stellantis, GM and others announce new lines and using up excess open capacity in the United States to make more cars here. So already seeing a good effect from the President's trade policies with respect to Canada and Mexico.
- [11:51]
Bloomberg Interviewer
So it sounds like a review and improve is the path you're on. Ambassador Greer, when it comes to the 122, are you prepared potentially for suits as well using that legal Authority?
- [12:03]
Jamison Greer
Well, any legal authority the President uses to impose tariffs, you know, foreign interests are going to sue, right? People who are importing from foreign companies and foreign workers, they're going to sue. So of course they. We expect that that comes along. However, I would say that the lower courts and even the Supreme Court expressed that 122 is an authority that the President can use. We put out the proclamation last week that lines out exactly how the President can use this and why he's using it and the declarations he's making. Are people going to sue? I expect they will. We feel confident in the case.
- [12:37]
Bloomberg Interviewer
In July of last year, though, the President's own lawyers said that 122 wasn't applicable. They said this is the appeal of the Court of International Trade decision. They said, basically. Nor does it have any obvious application here, 122 where the concerns the President identified in declaring an emergency arise from trade deficits, which are conceptually distinct from balance of payment deficits. So why do you think it works now when it didn't work over the summer?
- [13:03]
Jamison Greer
So, so I will say first of all that I think that there's more context to that statement. And further, a balance of payments payments is not identical to a trade deficit. People have kind of set up this straw man. That's just wrong. If you, if people go back and actually read the proclamation that went out, it talks about the actual balance of payments deficit. It refers to the current account. Now, the trade deficit is a big portion of the current account, so it certainly is a driver of it. But we also talk about things like our net investment income position where we're $26 trillion in the whole. So there are a variety of things that contribute to a balance of payments deficit deficit. And so folks who are out there with this kind of oversimple, you know, straw man argument that we're just equating a trade deficit to a balanced payments deficit. They're just wrong. They don't even understand. I don't think they've read the proclamation.
- [13:48]
Bloomberg Host
Ambassador, can we finish on the trade deficit widened recently? And just to wrap up the conversation, help explain to us what the metric for success is actually going to be for the administration to demonstrate to the American public that this effort is actually working.
- [14:03]
Jamison Greer
Sure. So, so when the President put his trade program into place starting in April, every month From April through December 2025, the trade deficit goods went down year on year. That's exactly what happened. So from April to December, the trade deficit in goods went down by 17%, 1,7% when we look at, you know, is the trade policy working? We're looking at the direction, the trend in the trade deficit. So that's going the right way. We're looking at real wages. Are they going up? Up? Are people being paid more to produce here? And they are. We have. Average weekly Earnings are up 4.4% over the year. And we're looking at what's happening with manufacturing. And we're seeing a lot more purchases of capital goods. We're seeing starts on factories. And so that's going the right direction. We're seeing productivity and manufacturing surging. So all of that's going the right direction. And we're seeing things like, you know, GE has announced, you know, another $3 billion worth of investment, a thousand jobs across five states, Georgia, Tennessee, etc. So we're seeing it in the data, and we're seeing it in the actual expansion of manufacturing in America.
- [15:06]
Bloomberg Host
Ambassador. And they've got to run. Thanks for making some time for us. Look forward to catching up again soon. Thank you, sir. Thank you very much. The US Trade Representative, Jamison Gray, on metrics for success after that trade deficit was much wider than expected in the previous rate.
- [15:19]
Matt Rogers
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- [15:22]
Bowen Yang
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- [15:30]
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Bowen Yang
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