Art Laffer: China trade deal is a win-win for the world
Former Reagan economist Art Laffer adds his perspective on the signing of ‘phase one' of the U.S.-China trade deal.
After more than two years of escalating tarrifs and a seemingly never-ending trade war, the US and China have agreed on a first step towards a truce.
If it holds, it could be a boost for U.S. President Donald Trump in an election year.
But who will benefit the most from this initial phase of a broader trade agreement?
China has promised to open up its markets and buy more US goods.
In exchange, the US will lift some tarrifs. Yet most will stay in place - and that's where the problems start.
So, could this really be the beginning of the end of the trade war between the US and China?
Presenter: Richelle Carey
Dan Wang, analyst for the Economist Intelligence Unit's Access China Service.
Hosuk Lee-Makiyama, Director of the European Centre for International Political Economy and a former Swedish Representative to the World Trade Organization.
Phil Caruso, Member of the Defense Council at the Truman National Security Project and a former Intelligence officer in the US Air Force. Mike Greenberg, Keyshawn Johnson, Cliff Avril, Dan Graziano, Bobby Carpenter and Laura Rutledge contend that it is too soon for the Cleveland Browns to give up on quarterback Baker Mayfield, and explain why he hasn't been placed in a position to be successful to this point. Marcus Spears and Dan Orlovsky agree that Philip Rivers is not a QB upgrade over Jacoby Brissett for the Indianapolis Colts.
✔️ Roughly 2,000 years before ancient Egyptians, the Chinchorro civilization developed a mummification process in northern Chile and southern Peru.
Americas Now correspondent Joel Richards went to northern Chile to see the millennia-old mummies.
CHERYL; WE'LL DIG INTO THE NUMBERS. EDWARD LAWRENCE LIVE AT WHITE HOUSE. "THE WALL STREET JOURNAL" BREAKING DOWN LAST TWO YEARS WITH CHINA AND UNCERTAINTY IMPACT ON THE ECONOMY. JOURNAL SAYS THE TRADE WAR TOOK A TOLL ON THE UNITED STATES, BUT NOT A BIG ONE. BRING IN FORMER REAGAN ECONOMIST, ART LAFFER. >> HEY, CHAIRMAN. CHERYL; FIRST ONE WAS AMERICAN FARMERS AND SOYBEAN PRODUCERS THAT WERE HIT OVER THE TRADE DEAL. CAN THEY RECOVER AND HOW QUICKLY? >> THEY CAN RECOVER, AND NOT ONLY REGAIN THE SIZE. TRUMP ALWAYS CLAIMED HE WAS A FREE TRADER AND THIS IS PROOF POSITIVE HE IS A FREE TRADER. HE IS TRYING TO MAKE THE U.S. ECONOMY BETTER. I'M VERY PLEASED WITH THIS TRADE DEAL. I'M EXCITED BEYOND BELIEF. TRADE IS MY SPECIALTY AIR AND IT IS WONDERFUL. CHERYL: THAT IS WHY YOU'RE HERE. LET ME ASK YOU THIS, THIS IS THE JOURNAL'S WORDS NOT MINE BUT I WANT TO GET YOUR REACTION. CHINA IS SET TO DO LITTLE MORE WHEN THEY SIGN THE DEAL, RESTORE AGRICULTURAL PURCHASES AND SAY NICE WORDS ON FINANCIAL SERVICES AND PROPER PROPERTY. WHAT DO YOU SAY TO THAT? >> I WOULD SAY THAT IT'S A LITTLE UNDERSTATED. I THINK IT IS MUCH MORE THAN THAT. I THINK CHINA IS READY TO PUT WHOLE HOG ON THE DEAL AND READY TO MAKE A BIG TRADING EXPANSION WITH THE UNITED STATES OVER TIME. I THINK IT IS MUCH MORE THAN A SMALL LITTLE STEP BACK WHERE WE WERE. I THINK IT WILL BE A FIRST STEP FOR A BIG, BIG RELATIONSHIP WITH CHINA. CHINA IS OUR NATURAL TRADING PARTNER IN THIS WORLD. IF EVER TWO COUNTRIES THAT COULD GET THE GAINS FROM TRADE IT IS THE UNITED STATES AND CHINA AND I'M VERY EXCITED. I WAS ONE OF THE FIRST GROUP TO GO TO CHINA 1970, OCTOBER OF 1970 I WENT WITH GEORGE SHULTZ AND JOHN ERHLICHMAN. WE DID THE PREKISSINGER TRIP. I ALWAYS FALLEN IN LOVE WITH CHINA AND I THOUGHT THE RELATIONSHIP BETWEEN CHINA AND THE U.S. WOULD BE A TREMENDOUS FOR BOTH COUNTRIES AND I STILL DO. CHERYL: LET ME ASK YOU THIS, THE IMPACT ON THE ECONOMY, THAT IS WHAT THE JOURNAL IS TALKING ABOUT, THE PRESIDENT SAID BEFORE HE WOULD LIKE TO SEE 3% ANNUAL ECONOMIC GROWTH BUT WE MAY BE MORE AROUND 2% FOR 2019. I KNOW YOU'RE BULLISH ABOUT SIGNING THE DEAL WITH THE CHINESE. WHAT DO YOU THINK IMPACT WILL BE FOR 2020 ECONOMIC GROWTH? >> LET ME JUST SAY, THAT I UNDERSTAND THE 3% NUMBER. I LIKE IT. ALL THAT IS GOOD. THIS ECONOMY HAS DONE EXTREMELY WELL OVER THE LAST TWO YEARS. IF YOU LOOK AT OUR ECONOMY IN THE CONTEXT OF THE WORLD, ALL OF THE REST OF THE WORLD HAS BEEN DECLINING DRAMATICALLY. WE HAVE NOT DECLINED DRAMATICALLY. WE'RE THE ONE SHINING LIGHT ON THE GLOBAL COMMUNITY, THAT HAS DONE REALLY WELL. I LIKE TO LOOK AT THE U.S. ECONOMY RELATIVE TO THE REST OF THE WORLD. IT HAS DONE NOTHING BUT EXPAND, EXPAND, EXPAND. OUR GDP TODAY IS 2 1/2% HIGHER THAN IT WOULD HAVE BEEN HAD WE GROWN AT RATE OF THE EUROZONE FOR THE LAST TWO YEARS. THAT IS A HUGE, THAT IS $700 BILLION. I MEAN IT IS AMAZING WHAT THE TAX BILL DID, WHAT THE DEREGULATION HAS DONE. I HAVE NO HOLD BACK ON THE U.S. ECONOMY. IT IS PERFORMING MAGNIFICENTLY. IF THE REST OF THE WORLD TURNS AROUND IN ANY WAY, SHAPE, FORM IN 2020, THAT WILL PUSH U.S. ECONOMIC GROWTH EVEN HIGHER. I COULDN'T BE HAPPIER HOW THE ECONOMY HAS PERFORMED. I'M ANTICIPATING A REALLY GOOD YEAR IN 2020. CHERYL: LET ME ASK YOU BEFORE YOU GO, WHO WINS IN ALL OF THIS? WE TALKED ABOUT FARMERS. WHAT ABOUT THE AUTO INDUSTRY? WHAT ABOUT FURNITURE MAKERS? WHAT ABOUT FIREWORKS COMPANIES? WE TALKED OVER THE LAST FEW YEARS HERE AT FOX BUSINESS ABOUT SOME OF THESE INDUSTRIES THAT WERE IMPACTED BY THE TRADE WAR. WHO IS THE FIRST WINNER, WHO IS THE BIG WINNER? >> THE BIGGEST WINNERS ARE THE U.S. AND CHINA AND THE REST OF THE WORLD. IT'S A WIN-WIN FOR EVERYONE. THESE ARE CALLED THE GAINS FROM TRADE. COMPARATIVE ADVANTAGE, DAVID RICARDO. IT'S A WIN-WIN FOR THE WORLD, THIS FREE-TRADE AGREEMENT. THE FURTHER WE GO ON FREE TRADE, THE BIGGER THE WINS WILL BE. THE ONLY LOSERS I CAN SEE ARE SOME DEMOCRATIC NAYSAYERS WHO WERE REALLY, NEVER GOING TO WORK. HE IS A PROTECTIONIST. HE IS TARIFF MAN, ALL OF THAT, THEY'RE THE LOSERS. THE WINNERS ARE ALL THE AMERICAN PEOPLE AND REST OF THE WORLD. IT IS NOT US VERSUS THEM. IT IS US WITH THEM MAKING IT MORE PROFITABLE WORLD FOR EVERYONE. CHERYL: ART LAFFER. THANK YOU FOR BEING HERE. APPRECIATE IT. >> CHERYL, YOU'RE DOING A GREAT JOB. TAKE OVER THE SHOW MORE OFTEN. I LOVE COMING ON WITH YOU. CHERYL: CHARLES WOULD LOVE TO HEAR THAT, THANKS. [LAUGHTER].