00:00White House National Economic Council Director, Kevin Hassett. Kevin, good to see you again.
00:04Hey, Jake. Good to see you.
00:05The White House says everything that happened over the last week and a half went according to plan.
00:10Over the course of just a few days, the global market lost trillions in stock value,
00:13regained some of it, but not all of it.
00:15The strength of the dollar right now is plunging.
00:17Consumer sentiment is worse than at any time during the Great Recession.
00:22Is all of this part of the plan?
00:24Right. In fact, let's talk about what the trade plan is,
00:27because I think that it's very, very important for people to understand
00:30why we're doing what we're doing and how we got to the point where this is the right strategy.
00:35The bottom line is that in the United States, there are these things called 232s.
00:41You've heard people talk about it.
00:42It's a trade action where the government decides that there's something that's a serious threat
00:47to national security if we don't do something about it.
00:50And so an example, just hypothetical, would be suppose that in order to protect ourselves
00:55from an adversary, we had cannons, but we had to buy the cannonballs from them.
01:00Well, then you could put a 232 tariff on the cannonball, and then we'd have to make it here,
01:05and then that would make it so that if we ever did have a situation where we were in conflict,
01:09that we'd have everything we need to protect ourselves.
01:12And so the 232 things were always excluded.
01:15They weren't covered by the new actions that you discussed at the opening.
01:18And so it's not like, so for example, semiconductors are the key important part of a lot of defense
01:25equipment, and there's going to be a semiconductor 232 that studies those things carefully
01:30and decides what has to be onshore in order to protect America.
01:34And so it was always the case in Annex 2 in the Reciprocal Act that semiconductors were going
01:39to not be covered by that action because there's a 232 action that was announced in the executive
01:45order that is going to address it. And so I don't think that anything really should be a surprise
01:51if people stopped and studied, but it seems like a lot of the coverage, people are in a rush to get
01:55the coverage out and didn't really think through the logic of it, which is why we have a longer
01:59form show with you here, right, Jake, where we can talk about what exactly is going on.
02:04And then finally, why is it that people think that there is an emergency about this?
02:07Well, it's because, especially over the last four years, the influence of China
02:13into every little corner of our country has just gotten bigger and bigger and bigger.
02:18And so it actually is the case that it's a very uncomfortable amount of Chinese input
02:23in our actual weapons systems, Jake, in our actual weapons systems.
02:26And so President Trump thinks it's urgent that we address these matters.
