00:03:10.000You know, if I have a friend who's taking advantage of me, you know, let's say I have a friend who's always borrowing money from me and sleeping over at my house and eating food out of my refrigerator.
00:03:41.000That means they stop spying on us, and they do spy on us.
00:03:44.000They spy on us more intensely than even our enemies.
00:03:48.000Based on varying estimates from the CIA and the Congress and other intelligence sources, they either are the second, third, or fourth most aggressive spying operation on U.S. soil.
00:03:59.000Second, third, or fourth most aggressive spying operation on U.S. soil, behind only Russia.
00:04:04.000But in some cases, they say that China's a little bit more aggressive.
00:04:08.000In every case, they say Russia's more aggressive, but they're an ally.
00:04:13.000We sell them our military tech, and they spy on us more aggressively than all of our allies and even some of our enemies, some of our worst enemies.
00:04:29.000Ending the war in Afghanistan, ending our involvement in Syria, Yemen, Somalia, West Africa, you know, all over where you have American troops that don't belong there.
00:06:09.000Those are the two things open ended and unconditional.
00:06:12.000We can have commitments, we can have allies, but none that are open ended and none that are unconditional.
00:06:16.000They have to be interest based, and we have to establish some upper bound on that, some time limit or something, so that we're not with these countries ad infinitum no matter what, and they take advantage of us.
00:06:46.000I'm a little under the weather in case you can't tell.
00:06:49.000We'll start by talking about trade, and then we'll get into economics.
00:06:52.000So, where we differ from conservatives on economics and on trade in particular is that conservatives are in favor of free trade.
00:07:00.000And they say that there should be no trade barriers put up by the United States.
00:07:04.000They say that we should have no tariffs, they say that we should have no other non-tariff barriers.
00:07:09.000They say that we should just have complete.
00:07:11.000Open free trade with these other countries and import as much as we can and export as much as we can without regard to the exchange rate of our currency, without regard to currency manipulation by foreign countries, without regard to the fact that other countries have trade barriers like tariffs and non tariff barriers, like they force companies to sign agreements where they give up their intellectual property or they teach the country how to do their manufacturing or the industry.
00:07:42.000Point being, most conservatives say we need free trade.
00:07:46.000No trade barriers, just trade your goods and services.
00:07:49.000America first says we need to protect our industry.
00:07:52.000We need to protect our workers and protect our economy, protectionism, with tariffs and other non-tariff barriers.
00:08:00.000In other words, what we want to do is foster industry in America, particularly manufacturing and industry, but also other things like the industries of the future, like artificial intelligence, robotics.
00:08:10.000We want to protect our strategic resources, things like steel, things that are needed in the production of planes and tanks and bullets for our military.
00:08:19.000It's much more prescient even now, or much more pertinent, I should say, now during the coronavirus pandemic.
00:08:27.000Masks, our own ventilators, our own medical equipment, because you're seeing when China makes all of our medical equipment, now they can hold it hostage at a time of crisis.
00:08:42.000And the reason why is this a lot of conservatives like to say that, well, free trade benefits everybody involved because of comparative advantage.
00:08:49.000And I'm not going to explain the whole thing.
00:08:51.000Probably a lot of you guys have heard this doctrine before, but they say that if one country specializes in widget A and one country specializes in widget B, Then the country that specializes in Widget B can make all Widget B's and export to the other country, and the country that makes Widget A can export all the countries to Widget B country, and everybody is richer.
00:09:11.000It's more efficient, and everybody is wealthy.
00:09:16.000You know, Ben Shapiro and many others are fond of saying that there's nothing wrong with a trade deficit.
00:09:21.000There's nothing wrong with our trade relationship with China because our relationship with China as a country is like our relationship as individuals with a grocery store.
00:09:31.000People like me will say the problem with our relationship with China is that they export too much to us.
00:09:37.000We have a $200 to $500 billion trade deficit before Trump with them.
00:09:42.000And a lot of conservatives say, well, that doesn't matter that we have a trade deficit because you have a trade deficit with your grocery store.
00:09:48.000We're buying goods from China with cash and other things.
00:09:51.000And that's the same as you going to the grocery store and giving cash for bananas or for pickles or hot dogs or, you know, coconuts, you know, or whatever, milk, eggs, you know, the staples, cheese.
00:10:04.000But of course, this is again an oversimplification.
00:10:07.000Just like comparative advantages, so is this.
00:10:10.000America buying more goods from China than they buy from us is not the same as you buying more from your grocery store than your grocery store buys for you.
00:10:40.000That if you subtract what we export from what we import from China, you have a negative $500 billion figure, right?
00:10:49.000But think about it this way you're not getting $500 billion worth of goods for free.
00:10:55.000When China sends us $500 billion worth of goods more than we send them, why would they do that?
00:11:01.000Why would they just give us more stuff than we give to them?
00:11:04.000Of course, we don't get that $500 billion worth of stuff, which might be consumer electronics or You know, parts or things like that, cheap plastic stuff, toys, whatever.
00:11:58.000Predominantly, China exports to us cheap things that are easy to make, cheap, low quality things that are easy to make, right?
00:12:07.000And a lot of people like to think about toys because toys is the simplest one, or shoes, you know, things that are very simple.
00:12:13.000You know, the raw goods are very cheap.
00:12:15.000It doesn't take a lot of intensive skill or labor to make them.
00:12:18.000And think about it this way if we're getting $500 billion worth of McDonald's toys, Is it worth it to trade $500 million in McDonald's toys for $500 billion worth of real estate?
00:12:31.000If we were to say, okay, we're going to take these McDonald's toys and in exchange, we're going to give you all this land in Kansas or all this land in Iowa, all this land in California, would that be a fair trade?
00:12:43.000Of course not, because land is worth more than consumer goods.
00:12:49.000Now, what about other assets like stocks, ownership, and shares and companies?
00:13:41.000The thing about debt is not only are they owning our debt, and that's obviously a liability in more ways than one, but also we're not just paying them back the principal, but we're also paying them interest on that.
00:13:52.000So, would you go into debt buying things like apples or consumer goods or cheap plastic things?
00:13:58.000Of course not, because you're going to be paying them.
00:14:01.000We can't even pay our own bills, let alone pay the interest and the principal back on our debt.
00:14:05.000So, in other words, we're saying, okay, we'll take all this cheap stuff that we can produce ourselves and we will indenture ourselves to you forever and we'll pay interest to you forever.
00:14:14.000And you're just going to have this passive income based on these consumer goods that you're providing to us that we could make ourselves.
00:14:50.000And the long story short on currency is that the more of our currency that they have, the more they can manipulate the exchange rate.
00:14:58.000And so basically, what they do is they take our dollars and they put them in this government fund.
00:15:03.000And what they do with this government fund is they will release this money into the world market at strategic times to manipulate the exchange rate with world currencies and with their currency.
00:15:15.000And what they can do by releasing the money at strategic times is they can devalue their currency against ours and they can make it so that their products are more competitive than domestically produced products.
00:15:29.000If they devalue their currency, then that means that their prices for the same goods will be lower.
00:15:34.000Than the prices for the goods in our country that are denominated in the dollar.
00:15:38.000And that means that we're going to buy more of them.
00:15:40.000And that means that that is only going to further facilitate a trade deficit.
00:15:44.000The more that they devalue the currency, the cheaper their stuff is, the more competitive it is, the cheaper it is, the more competitive it is, the more that we're going to import from them, and the more we import from them, the greater the trade deficit gets.
00:15:58.000The greater the trade deficit gets, the more that we pay them in debt, assets, and currency.
00:16:04.000And I know that one's a little bit complicated.
00:16:06.000I know the balance of payments is tricky, but if you're looking for a book on that, it's called Free Trade Doesn't Work by Ian Fletcher.
00:16:12.000Free Trade Doesn't Work by Ian Fletcher.
00:16:16.000I understand if I. Rush through that one too quickly if I didn't explain that one the best.
00:16:21.000But these are essentially the three pillars of America First America First on immigration, America First on foreign policy, and America First on trade.
00:16:30.000But I want to expand a little bit on trade, too, because this is the important thing about trade, which helps us understand the broader economy.
00:16:37.000Of course, trade isn't the only part of the economy.
00:16:40.000You know, we trade with other countries like China and Canada and the European Union, but we also obviously have an economy internally, and we have fiscal policy and we have monetary policy.
00:16:51.000You know, the government decides how much to tax us, and the government decides where they're going to put their subsidies, and you know how the economy works.
00:16:58.000But where trade helps us understand the economy is because when we look at trade, notice in that conversation, I didn't talk about anything like individual liberty, I didn't talk about GDP, I didn't talk about your right to buy from China.
00:17:14.000I talked about what's good for America.
00:17:16.000I talked about how are we going to have a situation where America is wealthy?
00:17:21.000How are we going to have a situation where America has the raw materials and