Today's guest is Victor Davis Hanson, a Senior Fellow at the Hoover Institution at Stanford University. He's a classicist, a philosopher, a writer, a public intellectual, and a man who understands ideas and concepts and explains them so crisply.
00:01:07.000He's done an amazing job building one of the most powerful youth organizations ever created, Turning Point USA.
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00:02:08.000So, Victor, you have had some phenomenal commentary lately on President Trump's tariff policy and how we should think about this through national security and The reindustrialization of America terms, please explain to our audience what your take is on President Trump's tariff announcement.
00:02:27.000Well, it's very incumbent upon him and his team to talk in terms of symmetry and parody and to emphasize that his wish would be a tariff free world.
00:02:38.000But unfortunately, that's been only half true, that the United States is the only country in the world with such low tariffs and has essentially a free market.
00:02:48.000And that was fine during the post-war era when we were rebuilding Europe and deterring the communist world.
00:02:57.000But 80 years later, the United States is facing $37 trillion in debt, $2-3 billion in interest per year, a $1.7 trillion budget deficit, and almost over, most years, over a billion dollars, excuse me, a trillion dollars In trade deficits.
00:03:17.000So what we're asking for is not asymmetry, but just parity.
00:03:22.000And that would mean we're not, I don't even think Donald Trump and his team have said we need parity right now.
00:03:28.000Just to take one example, they would say to Mexico, you were part of a free trade North American continent.
00:03:46.000You're a conduit for the communist Chinese to get around tariff policies, which are asymmetrical in their favor.
00:03:53.000And this is in addition to you have $63 billion coming to your country in remittances, most of whom are people here, are from whom people are here illegally, and they're subsidized by our own welfare system.
00:04:07.000And then there's some $20 to $30 billion in excess That's estimated to come from smuggling in the cartel's fentanyl trade, which was killed.
00:04:17.000That's not the behavior of a good neighbor, and we're just asking for parity.
00:04:21.000And I think he could apply that logic and tone, vocabulary, diction to all of these...
00:04:28.000Europe, China, maybe not China because we expect it from them, but Europe, Canada, Mexico, and not let them get away with the idea that we're waging a unilateral trade war when we're just asking for parity and reciprocity.
00:04:42.000So, help me understand the history of tariffs.
00:04:46.000The only history that most people can remember is, oh, tariffs caused the Great Depression, Smoot-Hawley tariff, but it's actually far more deep and complex and interesting than that.
00:04:55.000Our government was largely funded on tariffs, as per Abraham Lincoln supported and Alexander Hamilton.
00:05:02.000What is the history of tariffs when it comes to our country?
00:05:05.000And let's go much deeper than the superficial analysis that, oh, it caused the Great Depression.
00:05:09.000Well, to put it another way, We didn't have an income tax.
00:05:13.000It was envisioned in 1913, but ratified in 1916.
00:05:17.000So then that begs the question, where did the federal government get their money?
00:05:22.000They had no other source of revenue other than tariffs, essentially.
00:05:27.000And that was, it wasn't just the idea of protecting domestic industries, but it was also a revenue generating mechanism for the federal government.
00:05:39.000And one of the reasons, to be frank, why people did not want an income tax is because they felt that government by needs would be small and manageable.
00:05:49.000The federal government would be if it relied on tariff income rather than everybody paying, you know, a percentage of their wages.
00:05:57.000That was never envisioned by the founders.
00:05:59.000But tariffs were pretty much part and parcel of the American project until about 1916.
00:06:05.000And then all of a sudden, We substituted them with this vast new influx of the IRS and income tax revenue.
00:06:15.000And then people said, well, they're kind of obsolete now.
00:06:18.000But they were designed both to fund the federal government, but fund a small federal government, and also to protect vulnerable industries.
00:06:28.000But remember what the opposition is saying, Charlie, the free but not fair opposition.
00:06:35.000They're saying, Well, we believe that free trade must be maintained at all costs, without exception.
00:06:43.000And when you say it hurts Americans, Americans lose jobs, and American industries are offshored or outsourced, they say, no, no, it doesn't matter.
00:06:53.000Because the subsidies of our foreign governments are not sustainable if they're dumping product here below the cost of We're good to
00:07:24.000go. Then it's a way to put people into bankruptcy.
00:07:28.000And I can attest for that as somebody who farmed during the Reagan period when EU agricultural produce was subsidized and dumped in this country, and we were told that that was good for us because it would make us more efficient.
00:07:44.000They say, well, if you allow foreign stuff to come in, Uh, without a tariff, even though it's being produced at below the cost of production, then you're going to have to compete with it and that'll make you lean and mean, but there's only a certain point where you can compete when you're losing money.
00:08:01.000So it's a deliberate policy that, and I'm speaking as a conservative, but a lot of the libertarians believe that even the most abusive tariff, asymmetrical tariffs are in the interest of the target almost as if Yes, it has. And I want to really hone in on a couple things you mentioned there.
00:08:30.000The first of which is how the libertarian free trade absolutism took over so much of our trade policy and so much of the prevailing dogma of Washington, D.C. When did that start?
00:08:46.000And why did it largely go unchallenged or unchecked from the American right for nearly 30 or 40 years, despite the obvious consequences of deindustrialization, factory closings, and the fact that we couldn't make anything?
00:09:02.000Walk us through kind of how that hyper libertarian view grew.
00:09:06.000There had been a view in the 1960s and 70s and 80s as we...
00:09:16.000Remember, in 1945, there was no China as an industrial power.
00:09:22.000Europe was completely leveled, to speak, and Japan was destroyed.
00:09:26.000So we were providing about 85% of the washers, the dryers, even the vehicles, the planes.
00:09:33.000And that started to end as we subsidized the rebirth of these These once powerhouses by letting them send their products in here without a tariff either in the case of our allies that we owed it to them and they would get back on their feet or and they wouldn't turn communist or in the case of places like China they would be liberal the more affluent they got affluence was the twin supposedly of consensual government
00:10:03.000which didn't turn out to be true but so we were losing the the rust belt in the 70s And then what happened was, I think part of it was during the Reagan administration and the George H.W. and the Bill Clinton, there was this idea that finance was more important than assembly, global finance.
00:10:25.000So why this was the trade was destroying manufacturing and assembly and the middle classes.
00:10:31.000Then the service classes, and I'm talking about insurance and law and media and academia, And all sorts of investment we were pretty good at, and now we had under globalization not a 300 million person market at the time, but 6 billion.
00:10:51.000And so these areas, anybody who could have a product that was globalized, and that was mostly in these areas, Made out like bandits and they sold it to the middle class by saying well you have 401ks That's right Maybe you're not making what you want,
00:11:06.000but you've got all this investment now because and this the high-tech as well You know we're selling a billion Apple Computers or iPhones and this is all good for you, but the the problem was if you had muscular labor That could be outsourced or offshored and it was then it was so they said well We're going to provide people with high-tech communication devices,
00:11:34.000social media services, financial services, law services, academia, all that stuff.
00:11:46.000So even in case of agriculture, millions of acres were beginning farmed in Latin America and Asia.
00:11:54.000And industries were offshore and outsourced.
00:11:59.000And the idea was that the middle class and you could see it when Hillary Clinton went to West Virginia and she said, we're going to get you guys out of business.
00:13:39.000That upper-middle-class society, no one wanted the children...
00:13:43.000No one in suburban society wanted their kids to go work construction.
00:13:47.000The idea was you're gonna go work on a laptop, you're gonna go work as an accountant or an engineer.
00:13:51.000Upper middle class dogma became that if you had to sweat to make a living to be a plumber, a welder, electrician, there's something wrong with you, go get a four-year degree.
00:14:03.000Well, it was the idea that we were gonna be the brain of the world and the world would be the body and the body was inferior in that We were going to make so much money that it would trickle down to everybody in their 401ks and everything.
00:14:16.000And you saw that the vocabulary adjusted.
00:14:20.000Joe Biden said that people had to learn to code if they were minors or something.
00:14:24.000Hillary said something the same thing in West Virginia.
00:14:28.000We had this kind of thinly veiled class disparagement vocabulary.
00:14:34.000Irredeemables, you know, clingers, chumps, dregs.
00:14:41.000So there was a kind of a demonization as if they were the losers of globalization, and there was a geographical element to it.
00:14:47.000It was in the interior of the United States.
00:14:51.000And then the two blue coasts were going to be where all Stanford, Caltech, Harvard, Yale, Princeton, federal government, big banks, corporate headquarters, Silicon Valley.
00:15:01.000These were going to be leading the United States, and we were going to kind of be the tail or the drag, you know, farming, mining, Getting your hands dirty, extraction, production, assembly, manufacturing.
00:15:38.000And so we realized that our grandfathers were not stupid, that they wanted to be self-sufficient and the stuff of civilization, food, energy, housing, materials, ships, military equipment.
00:15:54.000And so I think we're kind of, we're questioning in that, that we thought we were so wealthy that the financial sectors and the globalization was going to carry us and now suddenly So, I couldn't agree with that more, and what President Trump is trying to course-correct it.
00:16:23.000I suppose I'm going to ask you a speculative question.
00:16:25.000Can we become a body, not just a brain economy?
00:16:33.000It's not just a bunch of people mindlessly on an assembly line putting widgets together.
00:16:38.000It requires the most sophisticated robotics, artificial intelligence, and those are areas that we excel in.
00:16:46.000So when you start to see these people building these huge power plants, mostly by natural gas, and AI plants.
00:16:55.000That technology can be married with assembly.
00:16:59.000So even though we have a fossilized 1.6 fertility rate, you can get an American and marry him with machines in assembly in manufacturing.
00:17:09.000Even in things like housing now, where you see entire walls made in factories, you know, the studs and everything, and then brought to the site and they're pre-assembled.
00:17:19.000And so we're very innovative and it's time that we We could do both very well, and it's kind of interesting what Trump is doing.
00:17:29.000He's kind of emulating very quickly the War Production Board.
00:17:33.000You know, we were the 17th largest army in the world.
00:17:36.000At the end of 1945, we had 12 million people, almost the size of the Soviet Union's army, and we had the largest navy in the world, but it was the largest navy In the sense of greater than all the Navy's put together.
00:17:49.000We built 140 aircraft carriers of various classifications.
00:17:53.000And what I'm getting at is what Roosevelt did, the socialist, he said, I'm not going to be a socialist anymore during the war.
00:17:59.000You, Henry Ford, You, Henry Kaiser, you, William Knudsen, you go out and make bombers and liberty ships and make a profit, but you've got to have the United States' interest.
00:18:11.000And I think that's what Trump's doing with Andreessen and David Sachs and even to a degree Zuckerberg and Elon Musk.
00:18:19.000He says, I will protect you when the Europeans go after you or the Chinese cheat on you.
00:18:23.000But I want you to invest here, and I want your abilities to be in service of America, and I want your rockets, and your Facebook, and your investments, and anything you make, create jobs here first.
00:18:39.000And it's kind of an appeal to a nationalist, patriotic element.
00:18:45.000I think a lot of the billionaire entrepreneurs are starting to react to it.
00:18:51.000The world is waking up to the power of gold.
00:18:54.000National banks are scrambling to secure it.
00:18:57.000According to the World Gold Council, central banks added 1,000 tons of gold in 2024.
00:19:03.000The third straight year of net gold buying.
00:19:06.000They understand what many investors don't.
00:20:09.000First day I got there, I noticed two things that nobody locked their bike up.
00:20:12.000And there wasn't one book in the bookstore that had a dash studies, no environmental studies, gender studies, race studies.
00:20:19.000It was all regular courses of the old style, math, science, literature, history, philosophy.
00:20:26.000And if I remember correctly, I could be wrong, but I'm drawing from memory of one of your lectures or articles that you might have been at Hillsdale or in Michigan riding your bike or something, and you saw Trump flags in 2016, and you saw some indicator.
00:21:11.000And I wrote that because I saw, and here where I live in the San Joaquin Valley, a lot of Hispanic males, especially even as early as 2016, I was just stunned that so many of them in building, construction, agriculture were going to vote Trump.
00:21:47.000There is a fair amount of angst and anxiety in the farmer community right now about these tariffs.
00:21:52.000I know you touched on this previously.
00:21:54.000I was at Oklahoma State University in Stillwater, Oklahoma, a couple days ago, and a couple farmers came up, and they were all Trump guys wearing Trump gear, and they were very worried.
00:22:03.000They said that these tariffs very well might raise the price of equipment coming in, that they might not be able to export their goods.
00:22:10.000Please, as a farmer, give us your take on Trump's tariff announcement.
00:22:16.000Well, I think the way to look at it is long-term and short-term.
00:22:19.000Almost every country that we export with, we're running a deficit with, I mean, in terms of now as a farmer and, say, almonds with India.
00:22:32.000And they have tariffs, and they're very tough people.
00:22:36.000So if they retaliate, the easiest thing they're going to do is say, we're not going to allow almonds in without a 40%.
00:22:43.000And they already have tariffs, but not that high.
00:22:46.000But long term, if you were able to achieve parity, And we took a short-term hit, and you were able to tell India and China and the Europeans, we're not going to let in this, this, this, unless you let our soybeans or our almonds or our cheese in at the same rate that we let yours in.
00:23:11.000And then I don't know to the degree to which he is going to retaliate by putting tariffs on Imported foodstuffs the United States is the law it's not the largest producer of export food in volume But it is in value.
00:23:26.000That's pretty amazing when you think we only have three hundred and thirty five million forty million and China's got 1.4 billion But so what I'm getting at is half of everything we produce we sell abroad and it's very pricey it's things like high-volume pistachios that are worth a lot of money or walnuts or Processed cheese, things like that.
00:23:50.000It's not just grain, which is essential, corn or sorghum, but we have a lot of really specialty crops that the world likes.
00:23:57.000And people are paranoid about that, especially because you can live without almonds and you can live without pistachios.
00:24:05.000So if they think that they're going to hurt a particular sector of the American, and that's what they do.
00:24:10.000When they negotiate with Trump, they look at particular red state or areas that are his His supporters and they want to target that type of commodity for these small towns and rural areas.
00:24:25.000The the farmer base overwhelmingly supported President Trump.
00:24:29.000And I believe long term it is going to they're going to have incredible prosperity.
00:24:34.000They also get heavy machinery discounts.
00:24:36.000I know that the president is looking at that in the upcoming tax bill.
00:24:40.000Victory, also you mentioned something a little while ago, just previously, you said that you were stunned by how many Hispanics and men were going in President Trump's direction.
00:24:50.000We are seeing a realignment of political parties.
00:24:53.000I know you've written extensively about this, where no longer are we divided as much on race, but we are divided instead really on male, female, and on class.
00:25:04.000How should we think about the current political divides and how our political parties are realigning?
00:25:11.000Well, Trump got 26 percent, I think, of the black vote and about 55 percent of the Hispanic male, maybe 48 in general.
00:25:20.000So there is a part of that was cultural.
00:25:23.000In other words, they like a strong leader.
00:25:26.000and physical feebleness bothered them, of course.
00:25:34.000They don't like the idea of biological males, crime, open borders, especially here, people didn't like.
00:25:41.000But there was also something about, I don't wanna say macho, but there was the idea that you want a strong representative of the United States that embodies our confidence.
00:25:49.000And so if somebody, That type of foreign policy appeals a lot to males.
00:26:05.000But class-wise, the idea of bringing jobs back in the United States and having, say, a worker and a half for every job, I mean, two jobs for every worker rather than, you know, two workers for every job is what They want, because it makes them more valuable and prized and appreciated.
00:26:25.000So this idea when Trump says, I brought in $3 trillion worth of foreign investment and in three years, you know, most economists say for every $10 billion, some say $20, you get a million jobs.
00:26:39.000So if what he says is correct, you could see 30 or 40, 50 million jobs in the next decade.
00:26:49.000I can be a machine operator and I'll have three or four offers rather than have to go beg and humiliate myself to work at minimum wage part-time.
00:27:09.000And that appeals to, I think, men in a strange way.
00:27:13.000So, as a historian, How would you judge President Trump's — we're almost at 100 days — his first 100 days versus Obama and that of the 20th century?
00:27:25.000He has accomplished quite a lot, signed a ton of executive orders.
00:27:29.000How would you look at what President Trump has been able to do in such a short period of time?
00:27:34.000Well, he's a counter-revolutionary, so he's mapped out his counter-revolution.
00:27:39.000And he's got, as you know, more lower district court injunctions in the first two months than any president, I mean, than Biden had in four years or any other president.
00:27:50.000So they are trying to do everything they can to stop him.
00:27:56.000But if he should do just four or five things, achieve a peace in Ukraine, a peace in the Middle East and make Iran inert in nuclear terms, get somewhat symmetry or parity in trade.
00:28:42.000We're going to look at deregulation and taxes, but we're going to not talk about trade.
00:28:47.000So they knew that if they were to do, they wanted probably some of them to do what Trump did, but if they did do what Trump, they would meet a level of resistance that they thought would be incompatible, either socially or culturally.
00:29:02.000And they got a lot of resistance as it was.
00:29:04.000But I think something about Trump's temperament or background or attitude or outlook makes him, Invulnerable or oblivious or protected from social opprobrium.
00:29:38.000COVID and the lockdowns and the 2008 financial crisis and our national debt and Nixon had a war on drugs.
00:29:45.000Never before in my lifetime have I seen something go from crisis to non-issue in under a hundred days.
00:29:51.000Yeah, I mean, they told us that you had to have comprehensive immigration reform, which was basically amnesty in their view.
00:29:58.000And if you didn't, you couldn't close the border.
00:30:00.000And he understood that the border was open because they wanted the border open, and they wanted 12 million people in here, both for cheap labor and for future political constituents, and for larger federal programs, greater taxes, more redistribution.
00:30:16.000And he just simply said, if you obey the law, And that means you fortify the border, and you secure it, and you turn people back, and there's no catch-and-release and no refugee status once you're here, but you have to do it.
00:30:29.000You could stop it and create, more importantly, a psychological sense of deterrence.
00:30:34.000And when he started to say things like, I have an executive order that if you come across the border illegally, you can't come back for 10 years.
00:30:42.000That was very brilliant because it told people, uh-oh, I'm here, and these people are serious.
00:30:48.000They might catch me, and then I can't come back legally.
00:30:51.000So you're actually seeing a little bit of reverse immigration.
00:30:55.000I think they really need to enhance that, because it's something people had talked about in the past, but they thought no president would ever dare do it.
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00:33:45.000And for every person that we have to eliminate their job, we're going to try to get them something better in the private sector.
00:33:52.000I think a little bit more of that tone that, we didn't ask for this, but if we don't do it, nobody else is going to do it.
00:33:59.000And they left it, they being the whole progressive agenda and project, and we have to do this, and there's no, we ran out of time.
00:34:07.000It was on our watch, our station, our time, this task fell to us.
00:34:11.000We didn't ask for it, but we're going to complete it.
00:34:13.000That kind of attitude, I think, would be a little bit better, or at least explain in detail.
00:34:19.000But if you just say, you know, we're going to invade Panama or we're going to take, uh, you know, Canada should be our 54. I understand the art of the deal, but you've got to, you, we got a, about a 10% independent conservative democratic constituency that we've got to reassure that things are going to get better.
00:35:22.000But on the other hand, they've got the biggest army of any NATO country, and they're well armed to the teeth, and they've killed or wounded, tragically, a million Russians.
00:35:33.000And so Russia, the only thing, the only Point in contention is how far west does Putin think he can get?
00:35:42.000In other words, how far can you push him back east from his embarkation point?
00:35:47.000So if you give them guarantees that they can defend themselves, then I think we see the The peace, all we're doing now is that every time we criticize Putin, Zelensky gets on his hind legs and says, I want to be back in NATO, I want more money.
00:36:00.000And every time we criticize him, Putin says this.