president Trump potentially opening a new front in the trade war this week
instructing Commerce Secretary Wilbur Ross to investigate whether automobile
imports pose a threat to national security the move is sure to further
strain relations with American allies and could ultimately result in hefty
tariffs for American buyers of foreign cars so this action is being
investigation being brought under Section 232 American trade law the
national security provision our foreign cars a threat out to security of course
not 56 percent of all cars sold in the
United States are made in the United States but we also make lots of parts
and we do a lot of design and research for cars so the auto industry in this
country has probably never been healthier or maybe not been healthier
since maybe 1940 or something like that I mean it's globally competitive it's
using all the advantages of open trade to make itself stronger and so you not
only have a strong US base but you have a very strong export component because
well and when we talk about the US auto industry today we just don't mean Ford
Chrysler and GM we're talking about mercedes and BMW and Toyota and Nissan
they all make cars in the United States well one of Donald Trump's theories here
is that if he does this then they'll have to come here and build more plants
and make more cars here but of course at what we know about a protected market is
that the quality of the cars goes down you know for those of us who were alive
in the 1970s and you know cars didn't last they were terrible it was only an
opening the car market that cars became a better experience for consumers so why
is Donald Trump doing this I think it's mostly about NAFTA because if you take
the cars made in the United States plus Canada in Mexico you have something like
75% of all cars are made in North America and he's not getting the
cooperation that he on nafta and this is his response to
that but he's forgetting here that first of all Mexico
I mean his main thing is that if he launches this investigation it's gonna
take eight months that's gonna get him through the November election and he can
say when people go to the polls in November oh yeah well I didn't get the
NAFTA deal but I'm being really tough with Canada Mexico because he's being
criticized about that right now and in eight months he's not gonna win this
appeal because it is not harming the industry Dan it's hard for me to
determine a Coquette a coherent strategy from the Trump trade team and I think in
part I mean with the president this week on China he was he was saying oh it's a
great deal after the week in negotiations then by the next day he's
saying all not such a great deal and the next day after that it's really a bad
deal and we've got to redo the whole thing
what what is going on here well it's very hard I mean I think Donald Trump
likes to play three-dimensional negotiation chess and it's hard to keep
your eye on the ball as Mary was suggesting the national security threat
from the auto industry very difficult to a credit
currently there are 24 Japanese and German auto factories in the United
States employing American workers all right so then you got to go looking for
other reasons what may be going on here Mary suggested the possibility of
forcing Mexico's hand on NAFTA I think another target here is Germany and
Angler Merkel Trump has several things going with her
the most important of which is the Iranian nuclear deal needs her support
on that the United States and England are very upset that the Germans are
negotiating a gas pipeline with Russia they would like them to stop doing that
and Trump has said any number of times he wants the Germans to increase their
military spending I think part of this is to put pressure on her get for
attention but of course the European Union has already posed an array of
counter tariffs that they're going to impose on American goods if we go
through with these auto tariffs well and Japan 11 percent of imports of our
imports are made in Japan so Japan is already teeing up
jinan steel and random tariffs how does this get Japan more likely to cooperate
I'm not sure it does and look at you know we the president was talking about
Auto Workers will like this deal as you point out some water work might like it
because if you're working at a Toyota plant in Tennessee you're an auto worker
too you might not you might not like this as much you know it used to be that
when you had a blockhead you prevented people from importing things a country
that was considered an act of war so retirement but now when you have the
White House sort of suggesting this on their own consumers it's just
inconceivable to me and again the same auto workers that might like the tax on
foreign cars the tariffs on it they're complaining about the steel tariffs
because that raises their costs it's just it just is counterproductive across
the field there's a view politically this helps the President on Republicans
because they're speaking for workers and so on and so forth but there's another
side of this story which is that the trade protectionism and the potential
retaliation is hurting parts of the farm belt for example which would be the
targets of that retaliation there's also a problem I think with a lot of business
decisions being withheld delayed because of the uncertainty about when the
tariffs are going to hit how bad will they be and so I think this is slowing
growth and we're hearing that as CEOs and others get to their earnings calls
are saying well this is my biggest concern now yeah I think one of the
things that's mysterious to me is that Donald Trump talks about this trade as
if his trade partners don't have any any way to respond and Mexico has a lot of
ways to respond as you mentioned it's a big importer of us food us agricultural
products but don't forget also that the US has some retaliation rights from the
solar panels and the dishwashers that Trump put the tariffs on and if they use
those retaliation rights June these are other countries Mexico Mexico has
retaliation rights and on June 1st if the steel tariffs that Donald Trump has
threatened on Mexico go into effect they can immediately use those retaliation
rights and I think they will and will harm red states all right big
imponderable possibly trouble still ahead Democrats are feeling the heat as
polls show the race for control of Congress tightening so what's behind the
Republican rebound some good news for Republicans this Memorial Day weekend as
the midterm campaign season kicks into high gear new polls show the GOP closing
the gap when it comes to which party voters will support in November's
congressional elections with the latest Real Clear Politics average showing the
Democrats lead narrowing to 4% Wall Street Journal columnist Karl Rove is a
former senior adviser to President George W Bush and a fox news contributor
Carl good to see you again thanks for coming in so let the primaries have been
rolling through here many states now what what are that what's the big
takeaway from your point of view well if you look at the generic ballot in just
before Christmas before they passed the tax cut the Democratic margin was 13
points by mid February it was down to nine by late march was down to seven and
as you say this Memorial Day weekend we find ourselves with a four-point
advantage for the Democrats think about what's going on during that time I think
three things are at play here one is improvement in the president's job
approval it's gone from being in the high 30s to the low 40s that maybe four
or five point increase may sound small but it's absolutely critical to the
Republicans that he be in the 42 43 44 percent range second of all the economy
perceptions of the economy are improving now whether that's directly because of
the tax cut or not we could argue that all day long but the fact of the matter
is people's perception of who what they're feeling about their own circle
to be a better people feel better yeah feel good all right what's the final
point would be the Democrats and now we're going through these primaries and
they're starting to see in certain states who the Democrats are putting up
and I'm not certain that's necessarily helping the Democrats in each and every
case now you would say that because there's ins I've seen the races Nebraska
Texas Pennsylvania the left side of the party is winning in districts that are
competitive districts where that kind of message may not play as well as a
centrist voice is that your point yeah and I think it's two things it's one
they're not some some left-leaning candidates like
in Nebraska - and Pennsylvania won but even when the candidates have entered
the race not as a left-wing fringe candidate the rhetoric that they feel
compelled to adopt in a Democratic primary places them to the left of where
they need to be and remember in order to win the house the Democrats are gonna
have to win districts that are at least purple and in some instances red yeah
okay so here's the thing though even by and the generic ballot there's no
question it's it's tightening the margin for holding the house according to Kevin
McCarthy the majority leader is six if they're within six the Republicans think
they can hold a house but here's what that doesn't take in consideration
Democratic voter enthusiasm I've talked to Republicans in some of these special
race election races and the Virginia governor's race ed gillespie told me the
Democratic turnout didn't show up entirely in the data before election day
and that was because Democrats are so fired up that they exceed the polling
what do you think of that I think that's accurate but there's a long time between
the November - 2017 of Virginia governor's race and the November 2018
midterm elections and we see we've seen this year conflicting information for
example we had a great deal of media commentary that pointed towards a big
turnout by Democrats in Texas even suggesting that they might eclipse the
Republicans well half again as many people voted in the Republican primaries
voted in the Democratic primary and the Democratic runoff is the lowest in
history and in Ohio Republicans outvoted the Democrats both parties had
competitive primaries for governor the Republicans far out voted the Democrats
so again we it's hard to say I would say that enthusiasm is on the side of the
Democrats but whether that's sufficient enough we don't know and we have an
eternity to go between now and November and all kinds of things can happen to
affect a voter enthusiasm and each party's likelihood of turning it seems
to me something else is happening here and that is that the Democrats who have
focused on robert muller robert muller donald trump corrupt even talking
impeachment are now beginning this shift okay they think they think that maybe
impeachment and all that drivings more Republican enthusiasm
because they don't like to see a Republican president during the election
repudiated and their turn begin Democrats are being returned to health
care rising costs rising premiums and gasoline prices which we know have gone
up for a variety of reasons as the summer driving season increases those
two Republican vulnerabilities they are and you put your finger on a really
interesting point which is the Democrats have moved away from impeachment I think
it's for two reasons one is is that it obscures their chance to talk about
broader issues and second while remember in order to win these districts they're
going to have to end these states in many instances they're going to have to
win swing independent voters and it's really interesting Democrats are
strongly in favor of impeachment Republicans strongly opposed to it and
independence on this question tend to look more likely Republicans than they
look like Democrats so it's if you're if you were wearing a Democratic hat you'd
tell them lay off impeachment oh yeah I think the
voices in the democratic party have been saying that have been have been you know
right on whether or not every candidate is gonna is going to listen to them is
another thing and during the primaries the rhetoric even if they've not come
out and endorsed the resistance by calling directly for impeachment
candidates who have been sort of more moderate or centrist in their views have
nonetheless adopted rhetoric which makes them sound like they are part of the
resistance example in Dallas could 30-second congressional districts well
the Democrats talked about how Trump will take us into a war that will
destroy the world and said to quote the question is not just Democrats versus
Republicans it's common sense versus quote idiocy
and that kind of language even if they don't endorse impeachment makes it sound
like they're a an avid part of the resistance yeah that plays in Palo Alto
but not necessarily a young district Plano Sylvania still ad star but thanks
Carl still ahead Starbucks courting controversy with its new guest policy
why the coffee chain's latest nod to its progressive patrons may be backfiring
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