How Globalism Stole Our Jobs, Our Land, and Our Future – Can Tariffs Restore by Reshore? - The David Knight Show

Episode Transcript
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Speaker 1 (00:08):
Joining us now is Spencer Morrison and his book is
called Reshore, How Terrifs will bring our jobs home and
revive the American Dream. And just as a little bit
of an introduction, Spencer Morrison is a lawyer, an entrepreneur,
an independent intellectual of the focus on applied philosophy, imperial history,
and practical economics. He provides extensive pro bono legal services

(00:32):
to the victims and the families of trafficked children Good
for You Smithy. He also is editor in chief of
the National Economics Editorial. His work on tariffs and trade
policy has been featured in major publications including the BBC
Real Clear, Politics, Daily Caller, American Greatness, Western Journal, the

(00:53):
American Thinker, Foundation for Economic Freedom. So you get the idea,
and I'm very interested to talk to him because tomorrow
it is going to be liberation Day. Tomorrow we're all
going to be free, and we're going to be free
because of Terras. So I'm going to let him give
you his case for Terras and his critiques of free

(01:14):
trade what has been called free trade. And we know
how NAFTA has worked out for us. We've said on
this program many times we talked about that giant sucking sound,
as Ross Perot called it, And that sucking sound, I
don't hear it so much anymore because I think everything's
been sucked out of this country already. But thank you
for joining us.

Speaker 2 (01:30):
Spencer, good morning, Thanks for having me on the show.

Speaker 1 (01:34):
Well, tell us a little bit about your critique of
how we got to this point. You know, globalism as
we look at it, it's also to me it's a technocracy.
When we look at it and we look at what
is happening with China. You make some very interesting observations
in terms of gross domestic product and how we measure that,

(01:55):
and how we really are already lost so much ground
to China. Talk a little bit about that.

Speaker 3 (02:01):
Yeah, certainly. So I think where I'd like to start
is understanding how foreign trade and the trade deficit actually works.
It doesn't work the way a lot of people think. Okay,
so if we take a look at last year, for example.

Speaker 1 (02:17):
Now let me just interject here. You know, we talk
all the time about the annual deficit with the budget
of the government spending, and we talk about the cumulative
debt of like thirty seven trillion dollars. It used to
be talked a great deal about a trade deficit. But
most people are not talking about trade deficit anymore, and
you talk a great deal about that. So yeah, talk
a little bit about the importance of keeping an eye
on the trade deficit.

Speaker 3 (02:39):
Well, the trade deficit really matters because it's the reflection
of the offshore production of this country. So I'm just
going to walk you through this. So, when we have
a trade deficit, what that means is that we're selling
more every year than we're buying every more than we're selling. Right,
So last year, for example, we purchased from foreign producers

(03:00):
one point two trillion dollars more worth of goods than
we sold to them. The question is, and this is
the question that very few people actually ask, is how
do we actually.

Speaker 2 (03:08):
Pay for that? Right?

Speaker 3 (03:10):
Part of it is paid for by selling services. So
America runs a trade surplus in services, so you know
apps like Spotify or Facebook that brings in a decent
amount of money into the country. Last year, in twenty
twenty four, it was about three hundred and fifty billion dollars,
So that brings that trade deficit down, but we're still
left with about nine hundred and nine hundred and twenty

(03:33):
billion dollars that we need to pay for.

Speaker 2 (03:36):
So how do we pay for that?

Speaker 3 (03:38):
Well, we do it in two ways, because the Chinese
aren't giving us goods for free, right, So what we're
doing is we're selling assets and we're selling debts.

Speaker 2 (03:47):
Right.

Speaker 3 (03:48):
Assets are production that we made in the past. So
for example, a house, if a house was built in
nineteen seventy three, the construction costs would have boosted the
GDP in nineteen seventy three, but not in these subsequent years.
But the house obviously retains value, right, and land retains value.
So in order to pay for the trade deficit, we
have to trade them something. So one of the ways

(04:09):
we're doing this is we're selling our assets, like our
real estate.

Speaker 2 (04:12):
So every year we're.

Speaker 3 (04:13):
Selling a ton of that. For example, in twenty twenty four,
we sold forty two billion dollars worth of real estate,
residential real estate, so houses, We sold eight billion dollars
worth of agricultural land, and we sold twelve billion dollars
worth of commercial real estate. So in order to get
these goods, these allegedly cheap goods from places like China
and Mexico, what we're actually doing is we're selling our inheritance. Yes,

(04:38):
we're selling ownership of this country.

Speaker 1 (04:40):
I agree, yes. And let me ask you, because we've
had both Scott Bessett and Howard Lutnik, and also Doug Bergham,
who is Interior Secretary, they have all talked about the
massive amount of assets that we have. When Doug Bergham
was in confirmation hearing, he said we got two hundred
trillion dollars to worth a federally owned land, and later

(05:03):
on when he was doing an interview with Breitbart, he
said one hundred trillion. So I don't know. I guess
it's a big difference in those two numbers, isn't it.
But whatever it is, they have indicated that they're looking
at putting those assets to work. And my question, and
many people's question, is is that going to be a liquidation?
As you point out, we've got twelve billion dollars worth

(05:24):
of commercial real estate, we got eight billion dollars worth
of agricultural stuff that's being sold to foreigners. Are they
now going to sell all of the land that is
owned by the federal government. Is that what this is
ultimately working up to a lot of people are suspicious
about that. I know it's not about the tariff's issue,
but that is one of the big concerns. What do
you think about that? Is all of this chaos that

(05:47):
is happening with a terraffs, And that's another layer above
and beyond. You know, how we collect taxes, whether it's
with tariffs or income taxes and that type of thing,
and I'm sympathetic to doing it through tariffs instead of
income tax I just don't like both of them. But
I'm also concerned about the chaos that is there. And
if this is to distract us from the fact that

(06:07):
maybe there's just a great Americathon auction that is coming
up in the future, I know it's kind of a
side issue. What do you think about that?

Speaker 3 (06:17):
Well, I think that's a really great point to make,
and I think it's very troubling as a matter of fact.
Now that's not you know, I don't have any insider information.
Typically I refuse to make predictions because I don't believe
that you can make predictions when we're dealing with a
complex system like the economy. Right the best we can
do is make forecasts. So I'm not going to speculate

(06:37):
on that point. But what I will say is that
there is an interesting historical parallel that is worth considering.

Speaker 2 (06:47):
Towards the well.

Speaker 3 (06:48):
I think about what happened to the British Empire and
British holdings towards the late eighteen hundreds and then culminating,
you know, with the Len Lease Agreement in World War Two.
The British Empire was running massive chronic trade deficits for
about fifty years, and that in very real terms, resulted

(07:11):
in all of the gold being shipped from the holdings
in London to the United States. It resulted in the lease,
which I mean, ultimately we will say it was consideration
for the products that were provided to the British Empire
by America in World War Two. So I mean what

(07:33):
we saw is that the British Empire and Great Britain
was completely sold sold out, in large part because they
were purchasing far more than they were selling. And I
think that's a very real possibility for this country. I mean,
we're really in the same position. We've run a large
chronic trade deficit every year since nineteen seventy four. It's
been fifty years. The cumulative value of that trade deficit,

(07:56):
when adjusted for inflation, is twenty five point two trillion
that has to be paid back, and where's the money
coming from. Are we not going to consume anything for
a whole year? Probably not? Or are we going to
Are we going to liquidate our assets and sell our
past and mortgage our future?

Speaker 2 (08:12):
Right?

Speaker 3 (08:13):
I mean, those are the only options. We've got to
pay for it somehow. Yes, how are we doing that?

Speaker 1 (08:16):
And that's a good example. That's a great example of
great Britain. You know, we've seen other things in terms
of usage of energy and stuff, and you can see
that when they were a manufacturing concern, they were using
all this energy. I used to hear people when I
was in high school in the seventies to cry the
fact that America was using so much of the world's
energy and said, yah, it's because they're manufacturing most of
the stuff that the world has. And yet you see

(08:38):
that has transitioned from America to China and so as
as the manufacturing is transitioning. And that's one of the
key things that you're pointing out is that the wealth
of a country is about actually making things. When you
talk about China and the US and GDP, you make
that case, you say, well, okay, they've got we've got

(08:58):
higher GDP. But most of our stuff, as you just said,
and as you point out in the book, most of
our stuff is largely skewed towards services as opposed to
actually manufacturing things.

Speaker 2 (09:11):
Yeah, that's entirely correct.

Speaker 3 (09:13):
I mean, the big issue here is that America's economy
has shifted from a productive economy and to a consumptive economy.
It's a service driven financial economy. But that doesn't actually
generate any material wealth for our own.

Speaker 2 (09:25):
People or for the world.

Speaker 3 (09:27):
I'd like to give a couple of really telling examples, sure,
as to the difference between what a productive economy in
China looks like versus the sort of financial economy in
the States. Right, in terms of steel production, in twenty
twenty three, China produced twelve point six times as much
steel as America. I mean, steel is the backbone of

(09:48):
the of the of a nation. Steel is what you
used to build skyscrapers, it's what you use to build
automobiles without steel, and I think I think President Trump
has pointed this out correctly.

Speaker 2 (09:59):
No steel, no nation.

Speaker 3 (10:01):
Right, So, right now we have a problem where we
don't actually produce enough steel to replicate our own economy.
We consume about twenty percent more steel than we produce concrete.
It's even worse. So you can look at the development
of a country along you know, how many resources it's consuming.
You know, concrete is directly tied to how much they're

(10:22):
you know, people were building.

Speaker 2 (10:23):
Are we building a country? Right?

Speaker 3 (10:26):
China produced twenty two point nine times more concrete in
twenty twenty three. I mean the level of construction and
creation that's going on in China is you know, is
orders of magnitude larger than what's going on in this country.
Power consumption. They're consuming more electricity, and I think you
made a very good point when you're talking about, you know,

(10:47):
Britain's shift to these so called green energies.

Speaker 2 (10:50):
I mean, the amount of energy.

Speaker 3 (10:52):
That people are able to use is directly proportional to
the wealth of that population. I mean the switch to
electricity from animal power, or the switch even for animal
power to steam power. I mean, these were tectonic leaps
in the wealth of mankind, right And it's because of
the sort of access that we had to power. Right
right now, America is falling behind under power consumption, and

(11:15):
as a result of prosperity is going to follow follow
our power consumption ship tonnage. America doesn't even make ships anymore.
All of the goods we consume are are shipped on
Chinese and Korean made vessels. America doesn't make any ships anymore.
For the merchant marine automobiles, it's another it's another one.
China makes more automobiles than we do. We import, we're

(11:39):
import dependent on foreign automobiles. About a third of the
automobiles we consume come from foreign producers. Right computing power,
we're now on paroity with China. Right computing power AI.
I mean that's a that's a sign of the future. Right,
that's tied to power consumption, and China is just shot

(12:00):
of where we're at right now.

Speaker 2 (12:01):
It's very dangerous because they've got very good AI. I mean,
look at deep Seek compared to chat GPT.

Speaker 3 (12:07):
Right, I mean, China's got some very powerful AIS with
some very energy intensive GPUs and they're going to make
good use of that. One more thing or two more things. Okay,
I know I'm rambling here, but I think these are
really important. So two more things. Machine tools. Machine tools
are the tools that shape shape, metal, shape our products. Right,

(12:30):
we need machine tools to make more machines. The market
share for America. We used to produce over fifty percent
of them. Now we're producing seven percent. China produces thirty
one percent. We actually produce fewer machine tools in Italy,
which is crazy if you think about it. And then
silicone chips. We're dependent on silicone chips. Right if we

(12:50):
stopped trading with China and Taiwan, this economy would shut down.
We don't make enough computers. The funny thing is is
that the machinery we used to make computers, the photo
lithography machines, we don't even make those in America. Those
are made by one company in the Netherlands. The ships
to Taiwan. The chips are printed in Taiwan and then
we buy them. But that whole supply chain, you know,

(13:14):
is offshot. So America is completely dependent on foreign suppliers
and designers for computers, which go in everything. They go
in our aircraft, they go in our cars, We use
them at work. We're on the computer right now. This
economy shuts down without computers and we can't even make them.

Speaker 1 (13:30):
Well, you know, it is one of the things that
has come out of NAFTA and free trade and globalist
trade is these long and complicated supply chains that we have,
as you're pointing out, I mean when we look at
the effects of an EMP, for example, the fact that
it's going to blow out transformers that are made by
one company in Germany, and they've got a long lead

(13:52):
time for doing these things. So if you had massive
destruction of a lot of these things, it's going to
be a long time before people can get a replacement
for it. So it is what the free trade regime
has created. It's a very complicated global infrastructure that, yes,
it can deliver a lot of goods efficiently, but at
the same time it has become really a house of cards,

(14:14):
a very complicated, easily destroyed supply chain, and we've all
been set up for a complete collapse, I think. And
this is globally. It's not just going to affect us.
It would also affect China. Yes, they are more independent,
and I think a lot of that goes back to energy,
and that has been directly and by FIAT and by

(14:36):
treaty which we didn't sign, the Paris Climate Accord. We
never signed into that. That was self ratified by Obama
and John Kerry. So we're supposed that we're pretending that
we're in this treaty which allows them to build I think,
what is it, something like six new coal power plants
coming online every week, and yet we've got to destroy
our coal power plants in the West, and the UK

(14:59):
has on that. They've basically they can't make steel because
they've shut down their steel plants and they and they
can't afford to compete because their energy is so expensive.
It's like four times as much as it is even
in Germany, and Germany can't compete with China. I think
that's one part of the China price that nobody's really
talked about energy, and that has by design been turned

(15:20):
over to China. But you had a couple of interesting
things when you talked about First you talked about GDP,
and then you pull that back and you said, well,
GDP inflates America's position. He said, you said, it's better
to look at the purchasing power parody and that changes
it considerably. Talk to the audience about what that is.

Speaker 2 (15:42):
Yeah, exactly.

Speaker 3 (15:44):
So typically the way GDP is marketed to the American
public is it's based on the on the value of
all the goods and services produced in the country. And
it's it's measured in relation to the American dollar, right,
because you know where the yardstick by which other countries
are excuse me, are measured. The problem of that, the

(16:07):
problem of doing it that way is that it really
undercuts the actual production in the rest of the world,
because you know, the value of a dollar is.

Speaker 2 (16:18):
Different in different countries. Right.

Speaker 3 (16:23):
So essentially, if you look at the value of production
and you account for that sort of inflationary differences, what
we find is that China's GDP is not simply equal
to America's, which is what they'd have you believe, it's
about fifty percent larger. It's even worse when you look
at just the productive components of the economy, right. So

(16:46):
America's economy is heavily based on services industry. You know,
an an a given year, about three quarters of the
economy is services, right, So things like accountants, lawyers, massages, restaurants,
all of those things that are you know, produced and
consumed simultaneously.

Speaker 2 (17:02):
Those are services.

Speaker 3 (17:04):
But in terms of producing long lasting value like steel
and concrete manufacturing, China's economy is not just double Americas.

Speaker 2 (17:15):
It's a hang on, I have the I have the
number here.

Speaker 1 (17:20):
You got it that it was three times larger than
America's their productive eadomy. Yeah, three times large.

Speaker 3 (17:25):
Yeah, that that sounds correct. I just wanted to look
to see if I had any numbers, any more specific
numbers for you.

Speaker 2 (17:31):
But but yeah, it's.

Speaker 1 (17:34):
Just going through a free I've got larger, I've got
the section here, and it was I thought, this is real,
really key. You said in twenty twenty two, service accounted
for eighty percent of American GDP. That means that America
produced just a five point three trillion worth of physical output. Meanwhile,
just two point fifty two point three percent of China's
GDP was services, so thirty three percent of its economy

(17:55):
was industrial output. In total, China's productive economy was fifteen
point seven tril or three times what America's was. I
thought that was very interesting, and especially because you know,
when you look at it, you talked about, you know,
normalizing it in a sense for the American dollar. That
is one of the things that they have done in
order to help them with the China price. Part of

(18:17):
that is currency manipulation as well as slave labor and
other things. Now, of course, they have a tremendous energy advantage,
and that was given them by FIAT. All the rest
of the leaders of the West decided that they were
going to hand this to them on a silver platter,
and so we've had this this global move to establish

(18:39):
him I think really as kind of a beta test
site for technocracy. What do you think about that in
terms of China's position and how that's been handed to them.

Speaker 3 (18:50):
I think I think it has been handed to them.
I think that's exactly correct. China's trade policies, you know,
to begin with, they were explicitly designed to focus on
predation right on the American market, and China has used
the American market to leap frog the scale of their industries.

(19:11):
Back in the nineteen eighties when China was opening up
for business, and even in two thousand and one when
China joined the World Trade Organization, they did not have
the purchasing power to actually consume the goods they were producing.
There was simply no market for it. The market that
they were piggybacking off of was America's. So China's rise

(19:31):
was impossible without the cooperation of America's politicians. Now the
question is why did Americans politicians do this? I mean,
what was the benefit you know that they accrued by
offshoring America's factories and jobs to China and making us
dependent on Chinese imports. I don't think it's a question

(19:53):
that you can answer from an economics perspective. There's simply no.
There's no long term just notification for doing so. I
think you can somewhat justified on a short term I mean,
obviously it's offshoring factories is in the short term interest
of any given company because they know they re cost

(20:13):
benefits by moving factories abroad, and that sort of creates
a cascade of offshoring. I call it in the book,
I call it the offshoring vicious cycle. So I think
there's a bit of that. But you got to remember
this was a top down policy choice. I mean, since
seventeen eighty nine, when the First ter eff Act was
implemented under George Washington, America has run high tariff policies.

(20:38):
In fact, this nation had the highest average tariff rate
throughout the nineteenth century. It was only in the nineteen
seventies that the tariffs were abandoned, and that's when you
start seeing this offshoring to China and other countries. Right, So,
This was a deliberately, a deliberate policy choice to integrate
America's economy with the world at large. It's hard to

(20:58):
speculate on motives. I mean, we can look to the EU,
the European Union. The European Union began as a European
Coal and Steel Commission, and in the documents that were
written by some of the founders and the debates they had,
you know, one of the things they wanted to do
is they wanted to prevent the outbreak of a third

(21:18):
World war. They wanted to make and I quote, they
wanted to make war materially impossible, right and economic integration.
The idea was is that it will make war impossible
because you know, simply you won't be able to fight.
If France is getting all of their coal from Germany
and Germany is getting all of their steel from France,
how can either country go to war when they need

(21:40):
the other country's resources. So I think that may have
been part of the impetus. But I mean, this really
brings us all back to globalism in one world government. Right,
if America's economy is fully integrated with that of the globe,
America is not economically independent and therefore political independence will
fold in the future. I think that's that's their end

(22:02):
a game ultimately.

Speaker 1 (22:03):
I agree. Yeah, when we look at it in the
European Union and Builderberg where they first talked about having
a euro and things like that, I kind of look
at it as not just that economic ties are going
to make things more peacefully. Actually you you talk about
it perhaps being exactly the opposite in your book, But
I think it was a recognition from them that it

(22:25):
would be a shorter path to global dominance if they
went through the economic issue through the tanks and planes.
You know, they could they could achieve global government economically
with a I don't know, maybe a world economic form.
They could maybe do that more quickly and more efficiently
economically rather than with tanks and planes, and so exactly

(22:48):
think that was a part, a big part of it.

Speaker 2 (22:52):
Exactly.

Speaker 1 (22:52):
You talk about how you know this whole idea, well,
if we trade with people, were not going to go
to war with them, But you say that's exactly the opposite,
little bit about that, Well, I think.

Speaker 3 (23:04):
It's very interesting if you look at the countries that
are the most warlike throughout history, those countries are always
the ones that are the most reliant on trade or
the most economically integrated. And the reason for that is
that disputes over resources, especially when one nation does you know,
relies on a particular resource for its own economic well being,

(23:28):
you know, basically necessitate conflict if the supplies are not available.
A really great example of that, well, we can go
all the way back to the Peloponnesian Wars in the
fourth century ancient Greece. You know, I'm a I'm a
classics guy. I love ancient history. There's a lot to
learn there. A great example is the city of Athens.

(23:48):
The city of Athens had no access to timber, and
it had very limited access to grain, which resulted in
the City of Athens trading with all of these other
cities across the ag and c for timber and grain.
This ultimately culminated in the creation of the so called
Delian League, whereby all of these states sort of under

(24:11):
the umbrella of Athens entered into basically a big free
trade agreement, and this, over the course of about twenty years,
transformed into the Athenian Empire, and this pitted them directly
against the other Greek states led by Sparta. It was
wars over resources, right, and you see the belligerent party

(24:34):
in that case was Athens. It's the same thing when
we look.

Speaker 2 (24:36):
At the history of Great Britain.

Speaker 3 (24:38):
Great Britain has been the i would say, the most
belligerent nation in the last thousand years. And a big
part of the reason for that is that Britain has
been relying on imports this whole time, right, and if
there's a shock or or a problem in acquiring imports
in Britain, well they have to go to war.

Speaker 2 (24:59):
Right.

Speaker 3 (25:00):
This is part of the reason the British Empire was
the biggest in world history, because Britain itself, if it
didn't have an empire, the country would starve.

Speaker 2 (25:08):
Right.

Speaker 3 (25:10):
The countries that trade together often end up in conflict.
And the converse of this is also true. The United
States of America traditionally, and I say traditionally as in
you know, sort of the eighteen hundreds, had an isolationist approach.
You know, it was not involved in, you know, in

(25:31):
all the European warfare, that sort of endemic warfare. I mean,
there was other stuff going on, obviously, but if you
compared it to European countries, you know, America is just
not getting involved, and the reason they had the luxury
of not getting involved because we weren't reliant on any
of these colonies for products.

Speaker 2 (25:47):
We could make everything here.

Speaker 1 (25:48):
Right now that we are engaged in foreign trade, we
have taken the mantle from the British Empire, the most
belligerent other countries.

Speaker 3 (25:56):
And all the bloodshed that goes with it.

Speaker 1 (25:57):
That's right. We had packs America, Expertanna, and now we
have a Pax Americana and it's not really peaceful ever,
is That's right. One of the other things that you said,
I thought it's a very interesting insight, and we'll get
into some of the specifics about what's happening with Liberation
Day here in a moment. I'd like to get your
thoughts on it. But one of the other things I

(26:19):
thought was an interesting insight when you were talking about
how you gave the example of textiles and how in
Christendom the Greco Romans had used slavery and it was
the impulse of Christians to invent machines so they didn't

(26:39):
have slaves. You talked about that as being a fundamental
aspect of production, and when you said that, I thought
about the way NAFTA and free trade was being sold
back in the nineties. I remember this debate when it
was happening. A lot of people would say, well, you
can get the Chinese to do this for practically nothing
they work for would you rather have cheap goods that's

(27:01):
produced by slave labor? And I used to always think
that was a really corrupt calculation. You know, it's like, yeah, okay,
let's do that. I'm I'm going to enslave those other
people over there, and yet it has redounded to our
harm in doing that type of thing, deciding that because
that's a big part of the Chinese price was the
cheap labor, even slave labor, that's there. But talk a

(27:22):
little bit about because that's a key part of your
argument in favor of tariffs. Was the way that the
King of England protected himself from the textile industry that
was being done by what was it the Flemish I
think it.

Speaker 3 (27:38):
Was, Yeah, it was Flanders. Yeah, So it's very interesting.
The rise of the rise of England as an industrial
powerhouse begins long before the Industrial Revolution. It actually begins
around the year twelve hundred a d. At that time, Chris,

(28:01):
I don't know if we're still Christendom. But at the
time we certainly were.

Speaker 2 (28:05):
Right.

Speaker 3 (28:06):
A big thing in Christendom was investing in machinery because
obviously slavery was illegal. There was no slavery as there
was in the Roman world. So in Christendom we invented
all sorts of We call this the first industrial revolution, right.
This is in sort of the twelve hundreds eleven hundreds,
when windmills and watermills, dreadmills, all of these things were

(28:29):
being used in a new way to mechanize the production
of you know, grinding grain, moving cranes fulling cloth, things
like that. And Flanders, which is an area in northern Europe, Belgium, Holland.
That area became sort of the mechanical hub for Northern
Europe where the textile industry really flourished and took off.

(28:54):
In Flanders, they were essentially purchasing cheap English wool, turning
it into finish textiles, and then selling that cloth back
to England, you know, at a higher price.

Speaker 2 (29:08):
Right.

Speaker 3 (29:09):
So England was sort of in a colonial trade paradigm
where they were making raw materials, shipping it to the
to the metropol and then buying the expensive products back.
Does that sound familiar. Exactly what was happening to America
in the colonial period, we were doing the same thing
to England, right, But what England, So, what England did
was very very, very very novel and very very smart.

(29:29):
A succession of English kings banned exports of wool to Flanders.
They put on high tariffs. They even paid textile textile
mill owners and machinists from from Holland to settle in
England and teach English how to how to make cloth
and set.

Speaker 2 (29:47):
Up these factories.

Speaker 3 (29:49):
And as a result, England actually because they had they
already had the wool, they had the raw materials, they
shut down the Flemish textile industry and they and England
became the main center, the main hub of production. So
for example, the cloth production rose from thirteen fifty just
five thousand balsuit cloth in England. By fifteen hundred it

(30:10):
was eighty thousand. England became very very rich during this
period relative to its rivals, because rather than focusing on
low tech, low value agriculture, they were now the hub
of manufacturing and textile design.

Speaker 2 (30:26):
And that that.

Speaker 3 (30:29):
Core industry is what gave birth to the Industrial Revolution.
England had all of the factories. It had you know,
the tinkerers, the inventors, It had a population that was
you know, very very knowledgeable about machinery, and that allowed
the industrial Revolution to really take hold in England in

(30:50):
the latter half of the seventeen hundreds and early eighteen hundreds.
And it would have been impossible without having that industry there, right,
because industrial development is is path dependent, right, So if
you're on sort of, you know, one track, it's very
difficult to switch tracks later. That's why countries that were
early adopters of industrial technologies are still the richest today.

(31:12):
There's a long latency effect. You even look at the
difference between the countries in eastern and Southern Europe versus
Western and northern Europe. In different regions of those countries,
like northern Italy versus Southern Italy, you have in many
ways very similar populations, but you have on one side
of the country that industrialized and one side that did not.

(31:33):
And it's taken you know, three years, two hundred years
to catch up, and they still haven't caught up, right,
Because the cutting edge is where all the economic growth
and wealth flows to, right, So if you're at the
cutting edge, it's easy to stay there, it's hard to
get there.

Speaker 2 (31:46):
So that's the.

Speaker 3 (31:47):
Whole point of tariffs, and the whole point of this
book is a reminder that America is at the bleeding
edge of technological development. But if we hollow out our
industries and if and if we reduce our human capital
so that people don't know how to make things, we're
not going to be able to stay there. And once
we lose that position, it's very, very difficult to get back.
It's taken China a century to get back right after

(32:10):
the after the Opium Wars, over a century, actually, yes, right,
and since since nineteen eighties, it's you know, it's decades
and decades to get back in the driver's seat. And
you know we're already there.

Speaker 2 (32:23):
Why leave?

Speaker 1 (32:24):
Yeah, I agree. Well, there's a whole lot of things
that come together with that. Again, it's the availability of energy.
And we've had our political leaders in the West have
decided that they don't want us to have affordable energy,
and it's not that's not just a measure of our lifestyle,
but it's also a measure of life expectancy. Cheap affordable energy.

(32:46):
So our own leaders have been undercutting us and I
guess that's part of the problem that I have with
looking at the terraffs as a energy, as a form
of crew, you know, when we have politicians who have
done these types of things for their own benefit, and

(33:08):
also the aspect of central planning. As I said earlier
in the show, the concern that I have with the
tariffs is that it requires a lot of central planning.
Who are the winner is going to be and who
are the losers going to be? And we've seen that
that fits perfectly with the Chinese Communist Party, but it's
a bit of a problem here in America. Early on

(33:29):
we had and you're right you talk about this, the
fact that Washington had put tariffs in. You say that
Jefferson was a bit reluctant about it. He was more
of a free trader. I think he was maybe not
on behalf of protectionism, but he bragged in his second
inaugural address I've talked about frequently on this show, that
he had eliminated the useless offices, as he put it,

(33:52):
and by doing so, he was able to support the
American government completely on tariffs collected at the border. And
so when he was doing it as president, he was
looking at it strictly as the source of revenue. Now
we have too much spending going on in the United
States to be able to even think about the teriffs
being able to do that, I imagine. But later on, as
you point out, in eighteen twelve, he came around to

(34:14):
Washington's thinking in terms of protecting of industry because it
was on the cusp of the eighteen twelve invasion by
the British. He realized that it had made us vulnerable
from a defense standpoint, But when he was doing it
it was for revenue. Later on in the eighteenth century
it was about protectionism. I'm not really clear what's going
on with Trump because he is, more than anything, focusing

(34:38):
it on a blanket attack on individual countries. He doesn't
have enough there to fund the revenue. We're one wind
up with an income tax plus a tariff, and he
doesn't seem to be focused on any particular industries. But
even with that, I think that the tariff aspect is
a bit troubling in terms of allowing the government to
pick winners and losers. What do you think first of

(34:58):
all about that the you know, protectionism, and it's linked
to central planning.

Speaker 3 (35:06):
Yeah, I mean, I think the first thing that I'll
say is that, you know, one of the things that
has made this country so great and economically productive.

Speaker 2 (35:14):
Is that it's very decent.

Speaker 3 (35:15):
It has historically been very decentralized in its economic production,
and I think that is an integral and key ingredient
in keeping America rich. You know, if we want to
make America great again, America has to be free again,
and part of that is economic freedom. Now this is
this sounds like a paradox. On the one hand, mister Morrison,

(35:38):
you're afraid of in favor of tariffs. On the other hand,
you're saying we need economic freedom. I don't think it's
a paradox. And the reason for that is that tariffs,
it's not about picking winners and losers. Every policy choice
is going to have a winner and a loser, regardless
of whether you do something or you don't do something.

(36:00):
We talked earlier in the show about the switch to
economic globalization. That was a deliberate policy choice. So America
used to have high tariffs. The government decided we're going
to get rid of those and instead we're going to
globalize the economy. That was a policy choice, and the
question is did that policy benefit the American people? And

(36:22):
I would say no, it didn't benefit the American people.
I don't think that we have access to better quality
goods today. I don't think we necessarily have access to
a better variety.

Speaker 2 (36:33):
Of goods today.

Speaker 3 (36:35):
And the reason for that is because somebody is going
to win and somebody is going to lose. Ideally, the
market picks who that is the problem is is that
if we don't have trade barriers like tariffs or other
I mean, tariffs are the main one, but there are
other ways of doing it as well if we don't
have those, Rather than the American people picking the winners,

(36:59):
it's really foreign governments that are picking the winners. A
good example of this is China. So China engages in
all sorts of asymmetrical trade with America and American companies.
Chinese manufacturers are given preferential land treatment, they are given
at massive loans and export subsidies. They are given asymmetrical

(37:23):
access to markets so they can sell and prove up
their products and Chinese markets whilst still having access to
American markets. But American companies don't have that same access.
As a result, what often happens is Chinese companies backed
by the Chinese state are able to outcompete American free enterprise,

(37:44):
and it has nothing to do with the quality of
the product, and it has everything to do with the
fact that the Chinese are simply able to dump their
products at below market rates and prices for twenty years
until they killed the American businesses off, and then they
have a monopoly. So the problem is is that American
businesses are operating on a private enterprise model. That's not

(38:08):
a problem, and that's what we want. But what I'm
saying is that in an international competition where you have
private American enterprise and small business competing against the Chinese government,
they're never going to win. And as a result, who's
picking the winners and losers? In a free trade paradigm
and you know free in air quotes, not really free,
but in this sort of economic globalist paradigm, China's government,

(38:32):
Germany's government, Canada's government, they're picking the winners and the losers.
In a tariff model, the American public, you know, has
a better opportunity to actually pick the winners because it's
going to level the playing field between these foreign producers
and American producers.

Speaker 1 (38:52):
I guess what I see happening. For example, a Taiwan
Semiconductor of manufactured TSMC, right, they've been given I think,
tens of billions of dollars because as you point out,
they are so incredibly productive in Taiwan that you know,
that's that's the big prize that's there. Why the US
and China both fighting over that. So the idea is,
let's get them to come here and open up in America.

(39:14):
Let's onshore these manufacturing processes that are over there. And
they have given them massive amounts of money. It's not
really working out yet for them. And I guess when
I look at that from a you know, from that standpoint,
we're trying to emulate what the Chinese Communist Party is
doing in terms of you, as you point out, tightly

(39:35):
integrating subsidizing particular industries. And I think there's an as
I look at it, I see a tendency by Americans say, Okay,
we need to do what the Chinese are doing, so
let's subsidize TSMC and other companies of that ilk. They're
doing it with a lot of different things on a
on a micro basis, I guess we could say we've

(39:55):
seen this type of thing happening with just stadiums being
built because they love to have the pride of having
a professional sports team there of some sort. They're more
than willing to give lots of money, billions of dollars
to these billionaires who own these different teams and have

(40:18):
it paid for by the small local businesses that are there,
and say, well, this is great for the economy. And
it's like, yeah, well, except that you're kind of directing
this and maybe it's not being done very efficiently, maybe
not as efficiently as a competitive market would do it.
And you know, from the standpoint of somebody who is
there with a small business having to subsidize this billionaires stadium,

(40:40):
I think when I look at this TSMC, it looks
like just a more sophisticated, bigger version of these local
stadiums being built for sports teams. And so that's my
concern is that the American government in many ways is
trying to imitate the central planning picking of winners and
losers that we see happening in China.

Speaker 3 (41:03):
I think that's always a risk. I don't think it's
the right way to do it. What I would like
to see is the President stick to the game plan
of instituting reciprocal tariffs. The idea being that American industries
are the most productive in the world, and if the
playing field was level, we would be able to outcompete

(41:28):
everyone else. Right, that's ultimately what we'd like to see,
reciprocal tariffs. Right, America's industries are actually more efficient on
a per unit, on a per cost basis. America's factories
are more efficient than Chinese factories, They're more efficient than
German factories, and they're more efficient than Canadian factories. The

(41:48):
issue again is that all of these other countries are
engaged in the sort of asymmetrical industrial policies that are
artificially lowering the costs to the detriment of you know,
America's industries, and then of course when they conquer them industry,
then they can jack up the price.

Speaker 1 (42:01):
I agree. You know, what we're seeing in Europe.

Speaker 3 (42:03):
Is reciprocal tariffs so that we can actually so American
companies can compete. We don't want to pick winners and losers,
because the reality is is we're going to win if
the playing field is level.

Speaker 1 (42:12):
I agree, I agree, Uh yeah, I would agree with
you on that. You know what we see a lot
of with Europe as well as with China especially. It
used to be called when I was in high school,
they call it eurosclerosis. You know, they would so highly
regulate everything that was there that they really couldn't move quickly.
They couldn't adapt, they couldn't change, whereas you had less
regulation in the US, and so the companies were able

(42:36):
to flex with demand and to change and to grow
and to innovate. And it really is regulation that is
doing that. So I look at it and on the
one hand, you know, you have the protectionism that we've
seen in Europe, now we see it in China. But
on the other hand, they hobble themselves with a highly
centrally planned economy and a great deal of regulation. And

(43:00):
I guess my concern about this is why I look
at it and look at the A nimble free market
and entrepreneurs that can adjust. I think that requires deregulation.
And it seems like we're putting too many eggs in
the tariff basket and not enough in the deregulation basket

(43:20):
to allow people to be able to build these companies
that we need here in America. Rather than just protecting
them because we think that that industry is important. What
do you think about that. Do you see much in
terms of a focus on deregulation and that being a
really key component, because I think that was a key
component of what happened in the prosperity of America. It

(43:43):
wasn't just tariffs at the border, it was freedom on
the inside. As Jefferson said, people inside the country don't
know a taxman, and they certainly didn't know somebody is
going to come around and micro manage their business in
the name of saving the planet from CO two or something.

Speaker 3 (43:58):
Right, Well, that's exactly correct. It's not an either or proposition,
it's a both and proposition. We need tariffs to balance
out to the market asymmetries so that American companies have
an opportunity to compete, because right now they're getting killed.
They don't have an opportunity to compete. So we need
to preserve the ability for them to compete. But part

(44:20):
and parcel to that is we don't want to go
the European model and just say, oh, we're protecting everything,
let's overregulate. We don't want to do that. America was
at its best and most vibrant economically in the nineteenth century,
and there was two critical components of that. Number one,

(44:41):
it was high tariffs, which promoted domestic manufacturing and domestic industry.
But number two, you're entirely correct, and this was the
most free country in the world. We had robust property rights,
we had economic and political freedom, the freedom to a
freedom of speech. We had at the time, we had

(45:03):
a very functional patent office. It's not like that anymore,
but at the time it was very functional. And this
allowed Americans to invent and to prosper off of their
inventions and to build industries without being you know crushed
by you know, cheap foreign imports. So we need both.
On the one hand, we need tariffs, but that's not
that's not in and of itself, going to be enough.

(45:23):
That's just going to get us to where Germany is today,
which is not great. We need to go back to
our roots and to have decentralized, decentralized economies. We need
to cut regulations, and we have to cut taxes. And
what I'd love to see. What I'd love to see
is the tariff being you know, reduced by domestic taxes.

(45:46):
So any money that we collect from the tariff so
one to one reduction in domestic taxes, whether that's import
taxes or you know, consumption taxes. I mean, ideally there's
no ideally there's no income tax. But what I'd love
to see is the money coming in from the tariffs
reduce the internal tax burden on a one to one basis.

(46:08):
That would be I think great, because then we'd have
a revenue neutral policy that promotes the American industry and
labor which doesn't actually have a cost associated with it.
And then tie to that the obviously you know, cutting
welfare and you know, making the government less bloated.

Speaker 2 (46:27):
We need to do that regardless.

Speaker 1 (46:29):
Right, Well, it's kind of interesting because you know, first
they were talking about hundreds of billions and then Trump said, well,
maybe about a trillion. Then we had Peter Navarro say
tariffs will be a six trillion dollar tax increase. But
then he said because he would use it as reduction,
he said, we'll use it to pay for the two
thousand making the twenty seventeen tax cuts permanent. So now

(46:51):
we're talking about reducing taxes. He's talking about maintaining the
status quo essentially, and saying that they're going to add
six trillion dollars in tax so I guess, you know,
when we talk about the actual policies, it's very interesting
to talk about the tariffs as we're coming up to
this big announcement tomorrow and everybody is still guessing as
to what that's going to be. We look at whether

(47:14):
or not they're going to actually do any reduction of taxes. Certainly,
there's been a lot of people in the media that
are favorable to Trump who said, well, we're going to
get rid of the income tax. That of course is
not going to happen at all. They made it very
clear that they're going to make these tax cuts permanent,
or they're going to take off taxes for this particular
for waitresses for example, or whatever. They're going to take

(47:35):
off taxes for tips. So that means that they're going
to keep the income tax. They're going to keep it
pretty much at the same level that it is. This
is going to be an additional tax. I'm assuming we
still don't know, because there's been so much back and
forth and it's been so volatile, and I guess that's
one of the key things. You know, we talk about
tariffs and taxes and regulations, but of course, chaos and

(47:56):
volatility is a big, big issue in the economy. Is well,
I mean, what do you I know, you don't make predictions,
but are you looking at this as he's saying he's
going to add six trillion dollar tax increase? Is that
the way you're looking at this? Do you think that
that's going to be a productive thing? What do you
think about that?

Speaker 3 (48:18):
Well, I'll be honest, I think the branding is very,
very bizarre and a little schizophrenic. And I think you
pointed this out in a previous program. You had mentioned that,
you know, on the one hand, we're saying tariffs are
going to bring jobs back, and on the other hand,
the tariffs are going to increase and we'll get more
revenue from them in the future, which should.

Speaker 2 (48:37):
Be precisely the opposite. If the terrorifts are successful.

Speaker 3 (48:41):
Go down, because we're going to be getting the money domestically, right,
And the whole point of the tarriffs is to increase
the size of the pie within the country so that
you can generate more money within America, you know, and
you can lower the taxes but get the same amount
of money because we're going to have more GDP in
the country, right, and that's sort of the point of
tariffs is to create long run economic growth, right. So

(49:05):
I don't really understand the branding. I don't know if
it's you know, if it's just about scoring political points
or or who knows. But it doesn't make a whole
lot of sense to me. But just speaking about the
you know, the historical value of the policies and what
we what we can expect. We can expect that if
President Trump stays the course and institutes reciprocal tariffs like

(49:26):
you said he's going to do, that is going to
create a large incentive for factories to reshore their factories
in America. It's going to create a lot of jobs.
It will create uh, you know, predicate jobs. So and
that ultimately will increase purchasing power in the long run.

Speaker 1 (49:44):
Let me ask you from a practical standpoint, So, is
youre you focus a lot on tariffs? Yeah, what are
the impacts of uh, you know, he replaced NAFTA with
usmc A. What are the impacts of that going to be?
I mean, it seemed like when he first announced these
things in January that were kind of take him back
and surprise that Oh wait a minute, we have a
treaty here on this is he to what extent are

(50:06):
you aware that he is hamstrung in terms of what
he can do with Canada and Mexico, for example, because
of the U s m c A.

Speaker 2 (50:14):
I don't.

Speaker 3 (50:14):
I don't think he's hamstrung legally. I mean politically it
may be a bit of a bind, but I think
you know, the president, you know, has show him that
he's willing to burn political capital on this issue. So
I'd like to see him to push forward on the
tariff agenda.

Speaker 1 (50:30):
But I mean, if they've got something in the tear,
if they've got something in the U. S m c A,
that that is an agreement they're part of. One of
the things that I don't like about and after or
U s MCA was that they had a mechanism in
there where they would the corporation, if they felt that
they were being unfairly tariff according to the agreement, could
take them take the country to arbitration. And so I

(50:53):
mean they would they would get that back. So you know,
I guess that was my question. I don't really know
how that plays out. Since there was so much much
done to distribute supply chains for automobile manufacturing over the
three countries, and all of a sudden you're going to
cut that and say, now that's not going to happen anymore.
I'm I'm just wondering just how much of the stuff
they can practically do, and maybe that's part of why

(51:14):
there's this big debate inside the administration and uncertainty about
what they're going to do.

Speaker 2 (51:19):
What do you think?

Speaker 3 (51:21):
Yeah, I mean the very fact that the so called
free trade agreement allocated production across Canada, America and Mexico
just goes to show that it's a centrally planned agreement.

Speaker 2 (51:31):
It's not free trade, that's right.

Speaker 1 (51:33):
I mean that was what Lon Paul said or somebody
said that, you know, well, if it's a free trade agreement,
you don't need a thousand pages to define that, right.

Speaker 2 (51:40):
Yeah, exactly.

Speaker 3 (51:41):
So, I mean the whole thing's a bit of a
I mean, it's a sham agreement. So I whether or
not you know it has any teeth is a question
I suppose for trade lawyers.

Speaker 2 (51:52):
I don't do a ton of that myself, but well,
what I'd say is that.

Speaker 3 (51:57):
The focus ultimately, I mean, there's a big show about,
you know, the asymmetrical trade with Canada. Okay, whatever, Canada
is the size of California. It's not a it's not
a big deal. What we really need to be focusing
on is China, right, and there's there's no such agreements
that are going to be binding with China. If we
dealt with China, I mean, it's an eighty twenty preto principle, right,

(52:20):
China's doing eighty percent of the damage. Let's deal with China. Yeah,
and you know, forget about Canada. I mean, ultimately, if Canada,
you know, engages in asymmetrical trade policies for the States,
it's not that it's not really that big a deal.
It Canada is a China tiny country. China is the one.
China the one we've got to deal with.

Speaker 1 (52:38):
And yet we say from Trump, you know, what is
the long term strategy? Is it to deal with China?
Or because he's already said, well, I'm going to increase
your tariffs, but I'll pull them back off if you
let us buy TikTok you know, so we get these
we get these mixed schizophrenag Yeah, the plies that are there,
It's like, okay, so are you really trying to protect
us from China or is this just some kind of
a thing so that you can solve to your friend,

(53:00):
get your friend to be able to buy TikTok. I
don't understand what's going on with it at all, but
we're just going to have to wait and see. It's
very interesting to talk to you, and I agree with
you in terms of forms of taxation. And we've always
had in the past a lot of different plans about
how we could change the way taxes are done. I
don't like the income tax because the intrusive nature of it,

(53:21):
because of all of the time consuming compliance with it
and everything. But you know, so there's a lot of
different things that have been proposed, you know, all kinds of
sales tax things or flat taxes or whatever. Everybody who's
always concerned that we're going to wind up with both
of them. So my concern with all of this is
that we're going to wind up with six dollars worth
of new tariffs as well as income taxes. But as

(53:44):
you point out, if they on short those that tariff
revenue goes away. So I guess that's one of the
reasons one of the keeping the income tax there. But
it's great talking to you, and again I'll remind people
the name of the book is Resure and Restoring the
American Dream and basically going back and recovering some of

(54:06):
the the principles and the tax structures that we had
at the foundation of this country, I think. And it's
a very interesting book. Spencer Morrison is the author, and
where's the best place to get it?

Speaker 2 (54:19):
Thanks very much.

Speaker 3 (54:20):
The book is currently available on Amazon. It can also
be pressursed directly from calum Opress. And if you'd like
to hear more on tarras, I'm always available on the
X or Twitter or whatever it's called these days. But
it's real sp Morrison.

Speaker 1 (54:33):
Okay, great, And Calumopress is that calmopress dot com is
that where people can find the book there when I
try to encourage him to get it outside of Amazon
at all possible, it's talking about decentralizing. That's that's another
way that we need to decentralize. Very interesting talking to you, Spencer,
Thank you so much again. The book is reshore how

(54:54):
Terrists will bring our jobs home and revive the American Dream.
And but as he pointed out, we need a lot
of different things to happen. We need especially to have
the regulation that's an important part of the formula that
made America prosperous in the eighteen hundreds, and that's a
part that seems to be forgotten. Thank you so much
for joining us, Spencer, and thank you audience for joining us.

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How Globalism Stole Our Jobs, Our Land, and Our Future – Can Tariffs Restore by Reshore?

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.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}How Globalism Stole Our Jobs, Our Land, and Our Future – Can Tariffs Restore by Reshore?