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Howard Lutnick: How America Can Hit 6% GDP Growth in 2026

January 09, 2026 / 01:27:20

This episode features Secretary Howard Lutnik discussing his experiences on Air Force One, his role as Secretary of Commerce, and the impact of tariffs on the U.S. economy. Key topics include interactions with world leaders, the restructuring of the Commerce Department, and the significance of trade deals with countries like Japan and China.

Lutnik shares a humorous anecdote about a late-night conversation with President Trump while waiting for a call from Ukrainian President Zelensky. He emphasizes the importance of being outcome-driven in government and the need for innovative thinking within the Commerce Department.

The episode also covers Lutnik's approach to tariffs, the rationale behind them, and how they aim to rebalance trade deficits. He explains the complexities of negotiating trade deals, particularly with Japan, and the strategic importance of maintaining U.S. manufacturing.

Additionally, Lutnik discusses pharmaceutical pricing reforms and the introduction of the Most Favored Nation pricing model, which aims to lower drug costs for Americans. He highlights the collaboration between various government departments to achieve these goals.

Finally, Lutnik reflects on the future of U.S. trade and economic growth, expressing optimism about achieving significant GDP growth and reducing the national deficit through effective policies and trade agreements.

TL;DR

Howard Lutnik discusses Air Force One experiences, tariffs, trade deals, and pharmaceutical pricing reforms as Secretary of Commerce.

Video

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What was the feeling the first time you

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were on Air Force One?

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>> It's just

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>> or Marine One like is there a special

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thing where you're just like what is

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going on? Like are

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>> Yeah.

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>> Yeah. When you're on these things like

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it's amazing.

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>> Yeah.

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>> Right. You're you are where real

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conversations happen. We went to see uh

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>> Putin. So I get on Air Force One at 5:00

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a.m. He gets on at 5:45.

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We fly to um Alaska.

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>> Alaska. Right.

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>> Okay.

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>> Right.

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>> So, we're talking about then we we're

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there for four hours with Putin and then

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we fly back. Now, uh Marco Rubio and

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Steve Wickoff go take a nap because we

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have to wait for Zillinsky to wake up to

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call Zalinsky and we have to wait for

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the European leaders to wake up, right?

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Because it's the middle of the night. So

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I stay up with the president and we're

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just chatting like we're just chatting

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watching golf. I mean we just like it's

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a lot of hours.

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>> Yeah.

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>> So then Zalinsky wakes up. Uh so they

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get on the phone with Zalinski and he

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talks to Zillinsky on his phone and then

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when he calls the European leaders when

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they get up they want to have us only

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secure call. So there's three secure

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handsets in his office. So he's on one,

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>> Rubio's on one, and Wit Coff's on one.

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And I'm just sitting on the couch.

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>> This is in in Air Force One.

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>> In Air Force One in his office in the

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Air Force. So I'm just sitting on the

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couch

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>> and I've been up for like 20 hours,

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okay?

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>> And uh and the president's been up for

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20 hours, but he's on the phone and the

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European leaders are talking. So I'm

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just sitting there and they're all on

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handsets, so I can't hear a word that

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anybody's saying. And I'm just sitting

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there. So I uh

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>> I fall asleep.

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>> Okay. So I'm just sitting there. They're

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talking on the phone like right there

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and I fall like this. So I'm like that.

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So Wickoff

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elbows the president, right? Points to

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me and then he uh the president unrolls

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a Tootsie Roll and [laughter] like

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tries to throw his kid into my mouth.

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Yeah. [laughter] He hits me in the face.

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I'm like I wake up. He goes he goes,

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"Har,

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while you're napping, we're trying to

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settle world peace."

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>> That's awesome.

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I'm [music] going.

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Well, welcome everybody to the all-in

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interview. I'd like to welcome Secretary

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Howard Lutnik, our esteemed Secretary of

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Commerce. When we did the first

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interview with you, it was at the

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beginning of the administration. It was

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almost a year ago, and to be honest, it

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turned out to be one of the most popular

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things we've ever done. There's the Elon

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Musk view factor, but then there was the

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Howard Lutnik [laughter] view factor and

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they were pretty much side by side

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actually. It's great that you gave us a

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chance a year later to come back and

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talk to you. Let's just start with the

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general look back for you. How has the

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year gone and specifically I I would

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love to understand

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what surprised you as a businessman

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walking into the government. Let's just

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start with that. So

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overall,

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you know, I have a goal, which is uh I

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want to be the cabinet secretary who has

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the most fun,

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>> right? And so I set out with that goal.

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>> And uh which means I am outcome driven,

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right? I don't uh I don't really buy

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into I worked really hard at something

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and it failed.

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>> If I worked really hard and it failed,

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>> it's a fail.

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>> It's a fail,

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>> right? If I got lucky and it just all

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fell into place and I did nothing, it's

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still success,

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>> right? [laughter] Because the outcomes

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are what matter, right?

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>> You know, you're not telling people how

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hard you worked and failed,

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>> right?

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>> So, um, how you get things done in

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government is fascinating.

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>> It's just different. What happened is

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most people who've ever been in

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government tend to be incremental.

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They come in, they say, "How did this

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work?" So someone explains how they work

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and they try to move the ball 10%

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forward.

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>> They don't really rethink it entirely.

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And so my objective was to come into

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this department which is an awesome,

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incredible diverse department and really

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think through its powers and its

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possibilities,

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reimagine them, rethink them, hire

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people and then mold those people to

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think outside the box. And so the first

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three months was really

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getting people to think, can can I

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really challenge this? Can I really do

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this? Can I really try to do this? And

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then trying to convince everybody around

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me that this is an okay way to do it.

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You the way it was done yesterday

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isn't right. It was just what they did

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yesterday. You're not even saying it's

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wrong. You're just saying it's not you.

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>> Do you get the organ rejection though of

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career bureaucrats who think, "Wait a

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minute. Howard's out for my job or this

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is just a totally different way of doing

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things. I don't feel comfortable with

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this. I don't necessarily agree. We hear

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a lot about sort of this deep state,

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whatever that is, like this career

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lifers that sort of push back on radical

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change.

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>> Well, look, in the beginning, we cut,

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you know, 20%. Like I I walked in the

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door here with 52,000 people in this

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department

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>> and now there's 40,000 people in this

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department. So, the idea is if you're

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going to cut 12,000 people, you have to

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do it fast. Right?

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>> So that everybody understands the next

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shoe is not going to drop tomorrow.

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Right? And find where we had programs

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that just were like this program was

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started in 1978. You'd be like, why are

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we doing it now? We had a department

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that was supporting advanced

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manufacturing set up in 1986. What were

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they doing as advanced manufacturing 40

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years ago as opposed to what people are

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doing now? Right.

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>> So that so it was really not taking out

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what's the core. And so we did that

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quickly and then you know I went and met

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every bureau um had town halls. I went

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to their offices

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and I basically

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told them where we were going, what we

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were doing and why. What I learned about

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government is the people here are very

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narrow.

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experts. They're amazing their knowledge

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of this particular topic.

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>> So there's not generalists in

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government, but you have someone who's

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great at this, someone who's great at

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this, someone who's great at this,

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someone who's great at this, and then

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your job as the secretary is to weave

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that blanket together, right?

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>> So that these specialists

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succeed. And so when you give them tasks

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that maximize their capacity, they get

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jazzed,

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>> right?

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>> And so I'm getting amazing output from

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this department because they're jazzed

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because someone appreciates their

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capacity and is driving it to success. I

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want to jump into some of these

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verticals of expertise that you oversee,

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but it may be useful for the audience

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actually if you just gave an overview of

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the scope of commerce because it is

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incredibly vast from trade to job

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creation to Noah to the Census Bureau to

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spectrum. There's a lot of things that

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you can shape on behalf of the United

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States.

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>> So tariffs, which have been a big

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conversation, there's two types of

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tariffs. There's general tariffs that's

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in front of the Supreme Court. And then

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there's sectoral specific tariffs. Those

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that are specific, industry specific are

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in this building. Okay. Yeah. And

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they're part of BIS, the Bureau of

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Industry and Security, right? And and

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that is both where we have export

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controls. We don't want to sell our best

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chips to our adversaries. We don't want

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to sell whatever is the fill in that's

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the Bureau of Industry and Security or

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uh do we want a license just to make

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sure you use it in this sort of way or

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that sort of way. Yeah. All of that is

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and they have guns and badges.

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>> Right. So they have guns and badges.

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>> Yeah.

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>> Right. because they have to protect and

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defend that. And they find people and

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that's and they also control the auto

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tariffs, the steel tariffs, uh

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pharmaceuticals, which we can talk about

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a bunch because it's been insanely

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successful driving down the price of uh

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pharmaceuticals in America. And um so

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that's the Bureau of Industry and

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Security BIS. Then you have ITA um which

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basically is the advocate for business,

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right? We're I'm the secretary of

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commerce. So that's like a fun job. Like

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you're in charge of commerce. So we help

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companies sell things around the world.

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>> That's our job. And we help states sort

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of bring in business to build and grow

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here. So we're sort of the import export

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assist model, right? So we're always

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helping Boeing, you know? So the guys,

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the senior executives of Boeing follow

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me around like a puppy because

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everywhere time I do a deal and if you

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look at my big deals at the end it says

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they buy 50 Boeing planes, you know,

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they buy 100 Boeing planes. So we're

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always helping American companies sell

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overseas and we're helping companies

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invest in America. Right.

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>> Right. Help them help them with their

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permits. Help them with whatever they

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need to build and grow so we can grow

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our American jobs here. So those are

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those are two examples. Then we have um

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NTIA right telecommunications that

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includes spectrum like how are we going

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to do 6G like how are we going to do 6G

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like how how do the pieces fit together

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that's our responsibility as the lead

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advisor

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>> right and then inside of that of course

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we have

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>> the AI the center for AI uh advancement

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right so we study and then we put out

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reports

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Like when Deep Seek comes out with their

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new model, right, and there's all this

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press about it,

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our department literally painstakingly

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studies it as compared to our models and

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publishes what's the difference,

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>> right?

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>> So that we actually there's a standard

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of knowledge,

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>> not you know the press making this that

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or the other thing. So and then we put

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out GDP,

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right? and we analyze and what's

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interesting about GDP is people don't

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realize what we do is we use the census

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so there's business census calling

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around to companies uh and it's not

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really calling around anymore it's more

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you know economic connection to

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companies through APIs and otherwise and

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and one of the keys for me is to uh to

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get rid of everything that's manual

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that's left and make it all automated

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make it all connected with APIs make it

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all make it make sense

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that you can do it amazingly well.

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Create GDP and then we put GDP out on

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the blockchain because if I'm publishing

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GDP, why not?

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>> Yeah.

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>> Like where where's the holdup?

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>> And you started doing that in July, I

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think.

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>> I mean, how fun is that to say, why

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don't we do that? And then, you know, we

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go to the Oval Office, I chat with the

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president, he goes, great. And then we

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do it. I mean, the reason you want to

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work for President Trump is his

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intuition

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is so extraordinary and his knowledge

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base is so amazing that

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>> I can go in and talk to him about should

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we put GDP on the blockchain and just

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before that he was doing something

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completely different, something

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completely different. And then he'll

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chat with you about 3 or five minutes

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and it goes that sounds great and then

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you just go do it.

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>> So it's really fun. We have the patent

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office, you know, and uh if you think of

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how valuable

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intellectual property is, how do we

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protect it? How do we defend it? What's

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the right way to think about it? So, and

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you have Noah, which is uh you know, we

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have inside of Noah, of course, is the

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word atmosphere, right? It's oceans and

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atmosphere. What does that mean? Oceans

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and above 50,000 ft is space. Space

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commerce. So I have now the office of

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space commerce which I've taken out of

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Noah and have put in my office so that I

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can reimag how do we handle commercial

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satellites.

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>> Okay. So we're going to dig into as many

00:13:02

of these areas as we can but let's go

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back to the first one. So can you bring

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us into the room leading into April 1st

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and

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>> April 2nd?

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>> April 2nd. Sorry. [laughter] and bring

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us into the room

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debating tariffs, debating where you

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wanted to start, debating the game

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theory, what were the puts and takes and

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how did you come up with the decisions

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you made and then if you could just

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reflect back on what went right,

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what would you want to redo and what was

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maybe and it still is misunderstood. So

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the president in his first term

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u he's been talking about tariffs and

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how the trade deficit of the United

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States of America is really a ripoff of

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America that uh people who don't weigh

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in very deep say well you have a a trade

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deficit with the supermarket right you

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know I mean you're always buying from

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the supermarket so you have a trade

00:14:02

deficit with the supermarket. That's

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that's just silly, right? If you think

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about it, let's say there are two

00:14:08

islands,

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right? One produces

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and one invents. So, the inventor lets

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the other island produce and keeps

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buying it from that other island, pays

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them the money, and that that other

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island uses the money to buy

00:14:27

the inventor's island. And over a period

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of time, the producer owns the

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inventor's island and the inventor works

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for the producer because he ran an

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infinite trade deficit and kept paying

00:14:42

his money away. So what's supposed to

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happen when I was in college, my

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uh you know freshman and sophomore

00:14:52

professors basically said if you run a

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trade deficit, you'll keep taking your

00:14:58

silly paper money and giving it to them

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and buy their wine and buy their cars

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and buy all their cool stuff and sooner

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or later they're going to say, "Hey, I

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don't want your stupid paper." And your

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dollar would devalue.

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you wouldn't be able to buy their stuff

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and it would all balance and that's sort

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of free foreign exchange floating

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currency

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theory. But what if you're America and

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you invent the light bulb and then you

00:15:27

invent the transistor and then you

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invent the GPU and you're just too darn

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smart.

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>> So what they do with those dollars

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>> is they come in and buy us. In 1985,

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we had net ownership of the rest of the

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world. So comparing the rest of the

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world's ownership of America and our

00:15:48

ownership of them, that counts

00:15:50

everything, their bonds, companies,

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stocks, every everything.

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>> Everything.

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>> We were net an investor of $148 billion.

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More of them than they owned of us. Fast

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forward to 2024.

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26

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trillion the other way. They own 26

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trillion of us more more than we owe

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them.

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>> What you're saying is we became

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effective employees of the people that

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were producing the things that we

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created.

00:16:21

>> Right. So when we call So the beginning

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so Donald Trump says we're getting

00:16:25

ripped off. We need to fix this.

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>> Mhm.

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>> Right. and and sort of like these junior

00:16:30

economists

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fight it and say no.

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>> Let me let me just stop for a second.

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That is the first time I've heard that

00:16:36

it is an extremely elegant framing

00:16:39

actually. It sets up an incredibly

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powerful way to measure the

00:16:43

effectiveness of tariffs,

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>> right?

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>> Which is And is that how you think about

00:16:47

it? Which is that imbalance is the north

00:16:50

star?

00:16:51

>> Yes.

00:16:52

>> Once we own at least the same of them as

00:16:55

they do of us,

00:16:56

>> that's balance.

00:16:57

>> That's balance. We're balanced,

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>> right? And right now we're at a $26

00:17:00

trillion.

00:17:01

>> Why would we

00:17:03

why would we have? So what happens is

00:17:05

you call a country up and you say, "I'm

00:17:07

going to set a tariff." They say, "Wait,

00:17:09

wait, wait. Before you set a tariff, how

00:17:11

about this? We'll invest $200 billion

00:17:15

dollar in your country and Toyota will

00:17:18

build a factory and and Seammens will

00:17:21

build a factory and they'll all build a

00:17:22

factory and and I'm like

00:17:26

you're just buying us,

00:17:27

>> right?

00:17:28

>> You're literally buying us. I understand

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what's better for you investing 200

00:17:34

billion in America or investing 200

00:17:37

billion

00:17:39

where where's better than investing

00:17:41

here? So what happens is that

00:17:45

natural argument which was always

00:17:50

previously successful

00:17:52

falls on deaf ears. And I'm pointing

00:17:54

over there because that's his office.

00:17:56

Okay. The White House is like right

00:17:57

there. And uh it just he says you're

00:18:01

only investing here because it's great

00:18:03

for you.

00:18:05

The answer is I want to rebalance and

00:18:09

that's what we're out to do.

00:18:11

Build it here, sell it here. Fine. Fine.

00:18:16

Or pay for the

00:18:19

privilege of selling it here.

00:18:23

>> How did you set the rates?

00:18:25

>> Well,

00:18:27

the president on the campaign trail had

00:18:32

uh two views. The the the debate and he

00:18:36

was really uh debating with the team and

00:18:39

inside his mind. Does he want to set a

00:18:42

universal tariff

00:18:44

or a specific country bycountry tariff?

00:18:48

Obviously universal tariff

00:18:51

it's easy you know Tuesday morning you

00:18:55

say

00:18:55

>> pick a number

00:18:56

>> 10% shazam

00:18:58

>> right

00:18:59

>> but we settled on

00:19:01

a country specific model much more

00:19:04

complex

00:19:06

much more difficult but much more

00:19:08

nuanced much more clever uh and much

00:19:10

tougher and he couldn't do that in his

00:19:13

first term

00:19:14

>> because he didn't have believers

00:19:18

around him. He had too much of the

00:19:20

people who who believed that that

00:19:23

sophomore professor's ideals. And even

00:19:27

though we were out $26 trillion,

00:19:30

you know, they they they thought that

00:19:32

was too casual a comment. And so, uh,

00:19:36

this administration came in with

00:19:39

incredibly sharp people, me included,

00:19:42

Jameson Greer, uh, Scott Besson, who

00:19:45

were on side,

00:19:47

>> on board

00:19:49

driving for these outcomes.

00:19:51

>> Let's double click into a couple of

00:19:52

these deals because some of the terms

00:19:54

you got, it would be just great if you

00:19:56

could walk us through how you convince

00:19:57

them. So, let's look at Japan. So the

00:19:59

Japan trade deal you walked out with I

00:20:03

think it was $550 billion of commitment

00:20:06

and terms I I mean I mentioned on the

00:20:08

sapot I've never seen terms like this

00:20:10

before [laughter] um which you can

00:20:12

explain which is basically you know

00:20:13

Japan gets your money back then you get

00:20:15

90% of the profits but can you just walk

00:20:17

us through when you go into the room

00:20:18

with the Japanese government just get us

00:20:21

to the outcome how do you negotiate that

00:20:23

deal with them? Okay. So, let's spend

00:20:24

some time in Japan because it's really

00:20:27

it's it's fascinating. So,

00:20:30

when thinking about Japan, I reminded

00:20:33

the president in 1853,

00:20:36

Admiral Perry went with an armada and

00:20:40

cannons and still had trouble opening

00:20:43

the Japanese market. Right? So the

00:20:45

Japanese market for cars as an example,

00:20:50

94% of cars driven in Japan are

00:20:53

Japanese. They don't drive German cars.

00:20:55

They don't drive Korean cars. They don't

00:20:57

drive American cars. The only American

00:20:59

cars really in Japan are Chevrolets

00:21:02

driven by the Yakuza. So you know, I

00:21:04

mean, you can't come home with a Chevy

00:21:07

and people think, "Woo!" You know, you

00:21:09

got a new job, did you? So, right. So

00:21:12

it's a culturally,

00:21:15

technically, and economically closed

00:21:19

market. So even if you opened it

00:21:21

technically, and even if you opened it

00:21:23

economically, you may not be able to

00:21:25

open open it socially.

00:21:26

>> Mhm.

00:21:27

>> So what we did is we said, "All right,

00:21:31

you're going to pay a 25% tariff."

00:21:35

Simple. You won't open your market,

00:21:38

right? I can't get you to really open

00:21:40

your mark. So, you just pay us 25%.

00:21:43

And uh and that's simple. We don't have

00:21:46

to negotiate, you know, we just pay for

00:21:48

the right and the math will fix itself

00:21:50

over time.

00:21:51

>> Mhm.

00:21:51

>> So, their leadership called and said we

00:21:56

we can't to do that.

00:21:58

And you know,

00:22:00

>> when someone says I can't do that, I'm

00:22:02

like

00:22:03

>> and how what did when you say why?

00:22:05

>> Yeah. So he and they explained why. They

00:22:07

said look the way the Japanese auto

00:22:10

manufacturers work is the government

00:22:14

subsidizes

00:22:16

uh the machinery that went to small

00:22:19

manufacturers. So what they did is let's

00:22:21

say company A could have a thousand

00:22:25

small companies and they make the cup

00:22:27

holder for this particular model,

00:22:30

>> right? And and so they have 50 people

00:22:32

who work at this company who make the

00:22:33

cup holder

00:22:34

>> for and that right for Toyota. But that

00:22:37

the machinery was subsidized by the

00:22:40

government

00:22:41

>> and so you have thousands tens of

00:22:43

thousands of these companies

00:22:46

>> and so they can't pick them up and move

00:22:48

them to America. Let me ask you just a

00:22:50

question before you go back to this. Was

00:22:52

it surprising to you that not just

00:22:53

Japan, but I'm sure you encountered it

00:22:55

everywhere, all these other governments

00:22:57

would be willing to shape and subsidize

00:23:01

their own domestic productivity, whereas

00:23:03

Americans were a little bit more on

00:23:06

their own.

00:23:06

>> It's amazing the subsidies,

00:23:11

the assistance, the it's not a level

00:23:14

playing field

00:23:15

>> that everybody else does for their own

00:23:18

domestic internal economy,

00:23:19

>> but not on every product,

00:23:21

>> right? But on many I mean like you know

00:23:24

we set steel and aluminum tariffs. You'd

00:23:26

say like why why do you do the whole

00:23:28

steel and aluminum thing? You'd say well

00:23:30

if the Chinese give power give the power

00:23:36

to the steel producer free.

00:23:37

>> Think of think of steel right it's like

00:23:40

brown dirt.

00:23:41

>> Yeah.

00:23:41

>> So you process the brown dirt to make it

00:23:43

iron ore. But you've all seen it's like

00:23:45

dirt.

00:23:46

>> And then you know how much power

00:23:48

>> you have to put into that to melt it to

00:23:50

make it look like one of those things

00:23:51

we've seen on TV where you're pouring

00:23:53

the iron ore.

00:23:54

>> And imagine if I gave you the power

00:23:56

>> for free. You'd be making your steel for

00:23:59

250 bucks a metric ton, right?

00:24:01

>> And you'd say, "How much does it cost in

00:24:02

America? 700 bucks a metric ton." So

00:24:05

they're going to put our guys out of

00:24:06

business, which means they put our guys

00:24:08

out of business. And then Japan

00:24:10

subsidizes it. Korea subsidizes it. So

00:24:14

maybe they can do it for 400 bucks a

00:24:15

metric done. And meanwhile our So we

00:24:18

start with 40

00:24:21

steel blast furnaces. Now we have 10.

00:24:24

And if we kept going, we were going to

00:24:26

have

00:24:27

>> zero.

00:24:27

>> Zero. And then what happens is you

00:24:29

become

00:24:31

basically subservient. If you need

00:24:34

steel, you want to build your own

00:24:35

missiles, you have to call another

00:24:37

country. Now they may be your allies

00:24:39

like Japan and Korea and you can call

00:24:42

them but you are not selfsufficient. So

00:24:46

Donald Trump says we need steel, we need

00:24:50

aluminum, we need copper, like and we

00:24:52

need to make our own semiconductors.

00:24:54

>> Yeah.

00:24:54

>> Right. We need to make our own

00:24:55

pharmaceuticals.

00:24:56

>> Right.

00:24:57

>> Like and once you understand this,

00:25:01

>> right? And and you really think about

00:25:03

it. Donald Trump is not only is he

00:25:06

completely correct, it it actually goes

00:25:09

to the thank God, right? Like you study

00:25:12

pharmaceuticals and you really study

00:25:15

them and you say, "Well, these generic

00:25:16

pharmaceuticals are made in India." Say,

00:25:18

"Oh yeah, good. India's our ally." But

00:25:20

the ingredients come from China.

00:25:22

>> Exactly.

00:25:23

>> So that if you know if there's one nut

00:25:26

or bolt that you need and it comes from

00:25:28

China, they don't send it to you.

00:25:30

>> Right.

00:25:31

>> Right. Like there were these things

00:25:32

called magnets, okay? And magnets go in

00:25:35

a car. The value of a magnet that goes

00:25:38

in a car is 20 bucks. 20 bucks, right?

00:25:44

You're buying a $30,000 car. It's a $20

00:25:47

part, right?

00:25:48

>> But if they don't have it,

00:25:49

>> car.

00:25:49

>> Oh, sorry. It can't work.

00:25:51

>> Right.

00:25:51

>> Right. Where do we get that part from?

00:25:53

Well, China

00:25:56

sells them. They buy the dirt, the

00:26:00

ingredient for $55 a pound and they sell

00:26:02

you the finished magnet for $55 a pound.

00:26:05

So no one's going to make the magnet if

00:26:07

you could sell the raw material for 55

00:26:09

bucks. So they're basically just losing

00:26:12

money and the answer is right.

00:26:15

>> Do you think that this mercantalism was

00:26:17

it a purposeful strategy to weaken

00:26:19

America or do you think it was just a

00:26:21

byproduct of capitalism? The answer is

00:26:25

uh yes.

00:26:27

It the Chinese economy is one of overp

00:26:33

production. They have 50 mayors

00:26:37

provinces and each of those provinces is

00:26:40

trying to succeed. So each of those

00:26:42

provinces wants to build an electric car

00:26:44

company. And the government puts in all

00:26:47

the money, builds the capital, gives

00:26:48

them the power, invest. So if you're the

00:26:51

mayor, you want the winning electric car

00:26:53

company cuz remember, China does not

00:26:55

have oil and natural gas. So they have

00:26:58

to build electric cuz they have coal,

00:27:01

right? So they have to build electric.

00:27:04

We don't. We're being fools to think

00:27:06

that we should have batteries and

00:27:07

everything that they make that we don't.

00:27:09

That's just foolish. But they So that

00:27:13

means if you have 50 mayors and they all

00:27:16

have what? One electric car company.

00:27:17

Nah, no. They're probably going to have

00:27:19

two just in case. So that's 100 electric

00:27:21

car companies and they're all trying to

00:27:23

kill each other

00:27:25

subsidized by the government so they can

00:27:27

cut their price 30%.

00:27:30

Why? Because the government just says,

00:27:31

"Look, let's just try to underell

00:27:33

everybody else." And then they make so

00:27:35

many cars. What do they do with all

00:27:36

these cars?

00:27:37

>> Right?

00:27:37

>> So then they dump them and they take the

00:27:40

electric car which cost them 30,000 and

00:27:43

they sell it in Europe for 15,000. So

00:27:46

you go to an electric car in Europe and

00:27:48

say 15,000 for this car. This is an

00:27:51

amazing car for 15,000. That's cuz it

00:27:53

cost 30,000.

00:27:55

>> And so what happens is that has the

00:27:58

effect of putting Volkswagen out of

00:28:01

business,

00:28:02

>> right?

00:28:02

>> So what happens is it's it's their model

00:28:07

which is an attack chaos model, but the

00:28:11

attack chaos model has over capacity.

00:28:15

And then they turn that over capacity

00:28:17

into an asset. Says, "Let's dump the

00:28:19

over capacity. We're going to lose a

00:28:21

fortune." Okay, but the government's

00:28:23

just paying. We're going to dump that

00:28:24

over capacity into America,

00:28:27

right? Or into Europe or into anybody

00:28:29

who'll take it, right? We'll put their

00:28:31

industry out of business and then we'll

00:28:34

have them over a barrel. will turn our

00:28:37

economic chaos

00:28:40

into international prowess

00:28:44

>> and leverage, right?

00:28:45

>> So that's

00:28:46

>> and so then you're the tariffs now then

00:28:48

basically slow that leverage down

00:28:51

because it takes that economic incentive

00:28:53

off the table. Do you need to follow up

00:28:54

with some other set of structural

00:28:56

changes though to write the ship in the

00:29:00

long term? we have to domesticate

00:29:02

production. Like what are the things

00:29:03

that we need to do

00:29:06

so that in eight years or 12 years if

00:29:09

the tariffs were to change, if a

00:29:11

different administration takes a

00:29:12

different point of view, what is

00:29:14

structurally going to be left behind

00:29:16

that prevents this from happening again?

00:29:18

Well, with respect to China,

00:29:21

if we blink,

00:29:24

they will sell below cost

00:29:27

in America and drive our domestic

00:29:30

companies out of business and then we

00:29:32

will be beholden to them.

00:29:34

>> Mhm.

00:29:35

>> That's sort of a simple math, right? I

00:29:38

mean, if if if you think about it,

00:29:41

they spend a fortune convincing everyone

00:29:44

that they should be environmentally

00:29:46

friendly and have an EV car. But if if

00:29:49

Europe doesn't make batteries

00:29:52

and they say have all EV cars by 2030,

00:29:56

then

00:29:58

who are they going to buy the batteries

00:29:59

from?

00:30:00

>> Mhm.

00:30:00

>> They have to buy it from China. And now

00:30:03

they need to buy it from China which

00:30:07

means

00:30:09

what is their foreign policy with

00:30:10

respect to China?

00:30:12

>> It's very positive.

00:30:15

That's all. Right. They trade economic,

00:30:20

>> you know, basically I've gotten

00:30:22

>> prowess over you

00:30:24

>> so that you're going to let me do this,

00:30:25

that, and the other thing. And

00:30:26

eventually,

00:30:28

>> you know, they're not playing with the

00:30:29

same rules that we play. And so when you

00:30:33

go around the world

00:30:35

and you study the world, like Japan

00:30:38

doesn't do cars by the same rules that

00:30:40

we do. So they had to have cars

00:30:45

be lower than 25%. 25% was basically a

00:30:49

number that choked them. And so we

00:30:52

analyzed together with them that 15%

00:30:55

would be the number they could live

00:30:56

with,

00:30:58

right? and keep making cars and build

00:31:01

more here. And then I said, "Well, but

00:31:04

why would we since you're not really

00:31:06

going to open your market? You're not

00:31:09

really going to let us have access. Um,

00:31:12

how are we going to do it?" And then I

00:31:16

spent

00:31:19

months

00:31:20

going back and forth with the Japanese

00:31:22

and President Trump with different

00:31:24

ideas. How about this? So if you

00:31:27

suggested I got it right the first time,

00:31:29

that would not be true. [laughter] I got

00:31:31

it right. You know, I've I've always

00:31:33

described my business success in life. I

00:31:35

always came at it like this, okay? And

00:31:38

then like this, this, like this, like

00:31:40

this rate to success.

00:31:42

>> Sooner or later, I got through. So

00:31:44

>> what we came up with was

00:31:48

$550 billion.

00:31:50

>> That this is not foreign direct

00:31:52

investment. This is not Toyota building

00:31:53

a factory in America. This is they

00:31:56

literally will finance

00:32:00

any project we want to build in America

00:32:03

as long as it's like a good cash flowing

00:32:05

project. Nuclear, we want to build a

00:32:08

hundred billion dollars of nuclear

00:32:10

plants. They will pay for it. So what

00:32:13

happens is they'll borrow the money on

00:32:14

like a 30-year bond in Japan.

00:32:17

>> So the Japanese government goes and

00:32:18

raises the 550 billion from their

00:32:20

domestic bond holders.

00:32:21

>> From their domestic bond holders,

00:32:22

>> right? So they're an LP to you and

00:32:24

you're the GP.

00:32:25

>> Exactly the right thing.

00:32:27

>> They're an LP. They give us the equity.

00:32:29

>> We build the nuclear power plant and

00:32:32

then it starts selling power

00:32:34

>> and we split the cash 50/50 until they

00:32:38

get back their money plus their

00:32:40

interest. So that means in 30 years

00:32:45

the taxpayers of Japan broke even and

00:32:50

their dividend was a reduced tariff that

00:32:54

every day they had a lower tariff. They

00:32:56

have more employment. They had this and

00:32:58

that and you know what their stock

00:33:00

market's up

00:33:02

20s.

00:33:03

>> Yeah.

00:33:04

>> Up. Yeah.

00:33:05

>> Not down.

00:33:06

>> Yeah.

00:33:07

>> Up. So, um, you know, that that's the

00:33:11

point which is it didn't cost their

00:33:13

taxpayers money over time, right? Now,

00:33:16

we it's pretty simple to understand how

00:33:18

much we're going to make. You'd say,

00:33:20

well, if it's 550 billion and their

00:33:22

interest rates are pretty low. So, let's

00:33:24

say over 30 years you're going to get

00:33:26

650 billion. When we pay them back 650

00:33:29

billion, if you say to me, how much did

00:33:31

America make? I would say 650 billion

00:33:34

cuz we split the money 50/50.

00:33:35

>> Yeah. Exactly. And after they get their

00:33:37

money back, cuz nuclear power plants

00:33:38

last a long time,

00:33:39

>> then the cash flow goes 90 to America

00:33:42

>> and 10 to Japan.

00:33:43

>> And when you say to America, is there an

00:33:45

account? How does that money then get

00:33:48

spent or allocated or

00:33:50

>> the only bank the United States of

00:33:53

America has as far as like the secretary

00:33:55

of commerce sees is called Treasury?

00:33:57

>> Treasury.

00:33:58

>> So we have accounts at Treasury and all

00:34:00

the money goes into Treasury. So all the

00:34:02

tariff money goes into Treasury. All

00:34:04

this money just goes into treasury. So

00:34:06

it reduces our deficit

00:34:10

and it reduces it is it is taxes paid by

00:34:16

others

00:34:16

>> right

00:34:17

>> for us to get our house in order right

00:34:19

that's why the president talks about the

00:34:21

external revenue service right in this

00:34:24

case you're going to make you'd say all

00:34:25

right well over over 20 years you

00:34:28

probably make 30 billion a year right

00:34:31

that's 30 billion a year you know how

00:34:33

much tax we'd have to raise

00:34:35

>> Yeah on Americans to cover 30 billion a

00:34:37

year. That's 30 billion a year just on

00:34:39

those trades. And then you have the

00:34:40

tariffs are 500 billion a year now. And

00:34:45

they will grow over time to a trillion a

00:34:47

year. And that money is not money we

00:34:50

have to pay in taxes. And eventually

00:34:53

that puts our house in order that lowers

00:34:55

interest rates, drives our economy, but

00:34:57

most importantly

00:35:00

we don't have to pay.

00:35:01

>> President Trump has talked about this.

00:35:02

He said that as you kind of execute the

00:35:06

tariff plan and extract this incremental

00:35:08

capital,

00:35:10

you could see a ratable reduction in

00:35:12

income taxes. Is that the right way to

00:35:13

think about this?

00:35:15

>> Or do you think there are other ways to

00:35:16

spend the money first that we need to

00:35:17

before we

00:35:18

>> Who paid for no tax on tips, no tax on

00:35:22

overtime, no tax on social security?

00:35:25

Right. Tariffs.

00:35:27

>> Tariffs.

00:35:28

>> So that's a like that's a down payment,

00:35:30

>> right?

00:35:31

>> Right. But that's the idea. We should be

00:35:33

able to reduce the tax burden from the

00:35:36

bottom up.

00:35:38

>> Yeah.

00:35:38

>> Right. Help Americans who make less than

00:35:41

$150,000, who earn overtime, who who own

00:35:44

earn tips. Let's reduce their tax

00:35:47

burden, right? Let's help America. And

00:35:49

that's, by the way, that's 85% of

00:35:51

America. It's not like it's a subset.

00:35:53

And so I think the president is deeply

00:35:56

focused on using the power of his

00:35:59

administration

00:36:01

to write a whole bunch of wrongs that

00:36:04

have been ripped off about our country

00:36:06

and that we are the richest country in

00:36:09

the world. And that means we don't have

00:36:11

to take things away from people.

00:36:14

Everybody assumes to to balance the

00:36:16

budget. If you asked a politician how

00:36:17

you would fix social security, they

00:36:20

would say take the retirement age out

00:36:22

>> out. Right.

00:36:23

>> Right. Take away. They would never say

00:36:27

we are the greatest country on the

00:36:29

earth. We have the greatest economy on

00:36:31

the earth. Can't we figure out ways to

00:36:34

enhance our revenues to keep the richest

00:36:38

country in the world should be able to

00:36:39

give people retirement at 65? We

00:36:41

shouldn't change a darn thing. And that

00:36:45

is his thinking.

00:36:46

>> Yeah.

00:36:47

>> And that's why it's so much more

00:36:48

powerful than any politician before.

00:36:50

Politicians think all they have to do is

00:36:52

give or take. Give or take. Give or

00:36:54

take. Give or take.

00:36:56

>> The way that you've explained this, it

00:36:57

makes an enormous amount of sense. It's

00:36:59

like you set the stage of here's the

00:37:01

historical imbalance. Here's how we want

00:37:03

to reset it. We want some investment

00:37:05

that we're going to get you whole

00:37:07

foreign country, but at the end of the

00:37:08

day, this is about American

00:37:10

exceptionalism. It's worked in Japan.

00:37:13

It's worked in Korea. You did the deal

00:37:15

with Europe. You did the deal with the

00:37:16

UK.

00:37:18

What's sort of out there that's still

00:37:20

there? I think India is kind of still

00:37:21

out there. Although it seems like they

00:37:23

are

00:37:25

capitulating a little bit. I saw that

00:37:27

they just bought a lot of liqufied

00:37:29

petroleum gas from the United States in

00:37:31

November. What are the big sort of hot

00:37:34

button places that you want?

00:37:35

>> I'll tell you a story about uh India.

00:37:38

So, um, if you remember, so I did the

00:37:42

first deal, the UK deal, and we told the

00:37:44

UK that they had to get it done by two

00:37:48

Fridays from now. That that was the date

00:37:51

that the train was going to leave the

00:37:53

station by two Fridays because I have a

00:37:55

lot of other countries doing things and,

00:37:56

you know, if someone else is first,

00:37:58

they're first. And President Trump does

00:38:01

deals like a staircase.

00:38:04

First air gets the best deal.

00:38:07

You can't get the best deal after the

00:38:09

first guy went. Everyone says, "I want

00:38:10

the UK deal. I want the UK deal." The

00:38:12

answer is

00:38:13

>> no. They were first. They took the

00:38:15

chance. They moved quickest. They're

00:38:17

first. Second up a stair.

00:38:19

>> So that sets the floor,

00:38:20

>> right? And then the next one's got to be

00:38:21

higher. And then the next one higher.

00:38:23

And then next one higher, the next one

00:38:25

higher. So he does things that way

00:38:27

because that way it incents you

00:38:30

>> to come to the table.

00:38:31

>> Right.

00:38:32

>> Right. You could have three countries

00:38:34

who are the second deal. They all get

00:38:36

done the same time,

00:38:37

>> right?

00:38:37

>> But, you know, if you want to wait and

00:38:39

see how it goes,

00:38:40

>> it's at your risk. So, he does the UK

00:38:44

deal and they had to get it done by

00:38:45

Friday. And Thursday afternoon, Kier

00:38:48

Starmer's on the phone, the president,

00:38:50

we have they do their deal Wednesday

00:38:53

night and on Thursday, we have a press

00:38:55

conference and we announce it. Okay. So,

00:38:58

everybody asked the president, who do

00:39:00

you think is next? And if you look back

00:39:03

at the time, he said he talks about a

00:39:05

variety of countries, but he names India

00:39:08

a couple of times publicly. It's not

00:39:11

it's not like a big secret. And we were

00:39:13

talking India and we told India you had

00:39:16

three Fridays.

00:39:19

>> You put them on a shot clock.

00:39:20

>> Well, they have to get it done because

00:39:21

what happens is I have lots of other

00:39:22

countries and when those other countries

00:39:25

do their deal,

00:39:27

>> the staircase goes up.

00:39:28

>> Right. And

00:39:29

>> yeah,

00:39:29

>> now the president during all these

00:39:32

deals, he would refer to me as the

00:39:35

greatest table setter who ever lived.

00:39:38

Okay? Because you've never had anybody

00:39:39

who was as successful as me as a

00:39:41

businessman before who's just the table

00:39:43

setter [laughter] basically, you know?

00:39:45

So, because what I would do is I would

00:39:47

negotiate the contracts and set the

00:39:50

whole deal up. But let's be clear, it's

00:39:54

his deal.

00:39:55

>> Yeah.

00:39:56

>> Okay. He's the closer. he does the deal.

00:39:59

So I said, "You got to have Modi. It's

00:40:01

all set up. You have to have Modi call

00:40:04

the president."

00:40:06

They were uncomfortable doing it. So

00:40:09

Modi didn't call.

00:40:11

>> Wow.

00:40:11

>> So that Friday left, middle of the next

00:40:14

week, we did Indonesia, the Philippines,

00:40:19

right? Vietnam, we announced a whole

00:40:21

bunch of deals.

00:40:22

>> Malaysia in that period.

00:40:23

>> So we did these whole bunch of deals. So

00:40:25

that's like

00:40:27

>> that staircase

00:40:28

>> and they were at and because we

00:40:30

negotiated them and assumed India was

00:40:32

going to be done before them. I had

00:40:34

negotiated them at a higher rate.

00:40:37

[laughter]

00:40:37

>> So now the problem is the deals came out

00:40:40

at a higher rate,

00:40:41

>> right?

00:40:41

>> And then India calls back and says, "Oh,

00:40:43

okay. We we're we're ready." I said,

00:40:45

"Ready for what?" You know, it was like

00:40:48

3 weeks later. I go, "Are are you ready

00:40:50

for the train that left the station 3

00:40:52

weeks ago?"

00:40:53

So what happened is they just you know

00:40:56

there sometimes there's that seessaw and

00:40:58

people on just the wrong side of the

00:41:00

seesaw you know when I was a when I was

00:41:02

a young uh

00:41:05

when I was young in business and I was a

00:41:07

trader one of my first jobs was a trader

00:41:10

and when I would start on the wrong side

00:41:12

of the seesaw you know I'd buy and it

00:41:14

would go down and then I'd sell it would

00:41:16

go up another buy it would go down and

00:41:18

sell like when you're on the right side

00:41:19

of the seesaw you can't lose you know

00:41:21

you buy it goes up and and you sell it

00:41:23

and it goes down and you buy it goes up

00:41:24

and it sell it goes down and you feel

00:41:26

like you're the king. But when you're on

00:41:27

the wrong side of the seessaw,

00:41:29

>> what I used to do is I used to put the

00:41:31

phone down.

00:41:32

>> I used to go in the bathroom, fill a

00:41:34

bucket with water, take a rag, and I

00:41:37

would wash the plants in the office cuz

00:41:39

it was much cheaper than me picking up

00:41:41

the [laughter] phone.

00:41:43

So, and then and then people would call

00:41:45

and say, you know, can I speak to Harry?

00:41:47

They go, no, he's in a meeting. And

00:41:48

meanwhile they'd look up and there I am

00:41:49

washing the plant because whatever I did

00:41:51

I would get back in there and I'd touch

00:41:53

it and it would go the wrong way. So

00:41:55

what happened is India just was you know

00:41:58

on the wrong side of the seessaw and it

00:42:00

wasn't it was just they couldn't get it

00:42:02

done when they needed to and then they

00:42:04

couldn't get it done and then they

00:42:05

couldn't get it done and then they

00:42:06

couldn't get it done and so what happens

00:42:07

is all these other countries

00:42:10

kept doing deals

00:42:13

and they're just further in the back of

00:42:15

the line and now when they say but but

00:42:17

what I want is I want the deal in

00:42:20

between

00:42:22

the UK and Vietnam Um because that's

00:42:25

what I negotiate,

00:42:27

>> right?

00:42:27

>> And they and they remember and I

00:42:30

remember

00:42:31

>> and they say but but you agreed

00:42:34

and I said then

00:42:37

>> then

00:42:38

>> not now

00:42:40

then. And so that's that's the problem.

00:42:45

India will work it out. But it's just,

00:42:49

you know, there's a lot of countries and

00:42:52

and they each have their own deep

00:42:54

internal politics.

00:42:55

>> Mhm.

00:42:56

>> And to get something approved by their

00:42:58

parliament or their diet or their, you

00:43:01

know, these are deeply complex things

00:43:04

and and we're dealing uh with the world,

00:43:07

but we've gotten them done. You know, we

00:43:11

got Europe done, right? We did Japan,

00:43:13

then I did Europe, then we did Korea,

00:43:16

and and we've done country after country

00:43:18

after country. And uh and these are

00:43:22

durable, meaning these are deals that

00:43:26

take care of the countries,

00:43:29

autos, pharmaceuticals,

00:43:31

semiconductors, you know, things that

00:43:33

really matter.

00:43:35

And the tariffs have been incredibly

00:43:39

effective. And you can use them to

00:43:42

change the trade deficit.

00:43:44

>> Sure.

00:43:44

>> But you can also use them to change

00:43:47

behavior. And we should spend some time

00:43:49

talking about drugs. And

00:43:50

>> this is what I wanted to do. Let's

00:43:51

double click into AI and drugs, but

00:43:52

let's start with drugs. So you were

00:43:54

pretty integrally involved in some of

00:43:56

the

00:43:57

>> the pharmaceutical repricing and

00:44:00

manufacturing deals. Just walk us

00:44:01

through what the goal of those were and

00:44:04

and how Americans will feel the impact

00:44:06

of the deals that you've been able to

00:44:07

get done. So

00:44:11

everybody who studies pharmaceuticals

00:44:15

um learns that America is the client, is

00:44:21

the consumer, is the payer

00:44:24

>> worldwide.

00:44:24

>> Worldwide we pay all the money. So these

00:44:27

drug companies make 75% of their

00:44:29

revenues in America and it's 100% of

00:44:32

their profits because what happens is we

00:44:34

pay let's say $1,000 for a drug and then

00:44:38

Europe says, "Yeah, we have socialized

00:44:41

medicine. We're not we're not buying it

00:44:42

unless what's your cost?" And the drug

00:44:45

company says 100 bucks. So they say

00:44:48

we'll pay you

00:44:50

$175.

00:44:52

You can make 75 bucks. And then the drug

00:44:54

company says no. And then Europe says,

00:44:57

"Okay, I'm not buying it then." You'd

00:45:00

say, "What do you mean you're not

00:45:00

buying? You're not going to give

00:45:01

medicine to your people?" They go, "No,

00:45:04

we can't afford it." No. So eventually

00:45:06

the drug company says, "Ah, fine." So

00:45:08

we're paying a,000

00:45:11

and they're paying 175 bucks.

00:45:15

You know, six times less. And you'd be

00:45:17

like, "What?"

00:45:19

And that is how the whole world's drug

00:45:23

model was working. We're paying a,000.

00:45:26

Everyone else in the world is paying 175

00:45:28

bucks. So Donald Trump says I want to

00:45:32

fix it and I want MFN price. You want to

00:45:36

charge us

00:45:37

>> most favored nations.

00:45:38

>> Most favorite nations. So

00:45:39

>> we're the cheapest price in the world.

00:45:41

>> Right. But you could charge them 500 and

00:45:44

then you could charge us 500. Fine.

00:45:46

>> Right.

00:45:47

>> But if you're willing to sell it to them

00:45:48

for 175 bucks, don't come here and tell

00:45:52

me that I have to pay a thousand. All

00:45:54

right.

00:45:54

>> It's just unfair. [laughter]

00:45:55

>> You're not dictating price in America.

00:45:56

You're essentially dictating the lower

00:45:59

bound price abroad.

00:46:00

>> We are dictating fairness.

00:46:02

>> Fairness.

00:46:03

>> Like if we're your biggest customer,

00:46:06

treat us like fairly. We're not even

00:46:08

saying treat us the best. We're saying

00:46:11

treat us fairly. I mean, it's amazing.

00:46:14

So he writes a letter to 17

00:46:17

giant pharmaceutical companies said, "I

00:46:20

want MFN." And I got to tell you, I

00:46:23

don't know a single person in this

00:46:26

administration who thought he could do

00:46:27

it. It was so audacious, so bold, so

00:46:31

powerful. I was like, jeez. I mean, you

00:46:34

know, you just write a letter to all the

00:46:35

big drug companies saying, "You're going

00:46:37

to give us MFN." And you like write a

00:46:39

stern letter. And I'm like,

00:46:41

>> okay,

00:46:42

>> good luck with that.

00:46:42

>> How's this baby going to work? Right?

00:46:44

you know, and then so I sit with uh we

00:46:48

have this amazing meeting with Bobby

00:46:50

Kennedy and uh

00:46:53

and his team and we say, "Look,

00:46:56

I've got these 232 tariffs.

00:46:59

I could smash these companies. Smash

00:47:01

them because they all make it overseas

00:47:03

and then exported to us and we're and

00:47:05

we're all the money. So we could charge

00:47:07

them any tariff we want. We charge them

00:47:08

500%.

00:47:10

So, let's do something that's never been

00:47:13

done before. Let's literally be a team,

00:47:17

okay? You lead. So, Bobby and his team

00:47:21

who were amazing, Dr. Oz, Chris Club, I

00:47:24

mean, these guys did spectacular job.

00:47:27

>> They led, but I was the hammer, right?

00:47:31

>> From table setter to hammer

00:47:33

>> to hammer. So, now I'm the hammer.

00:47:34

>> Okay.

00:47:35

>> Right. So I'm like in the background

00:47:36

like hammer and then like say look

00:47:41

you have two things we want from you. We

00:47:44

want your best drugs at MFN prices. You

00:47:48

can't sell it to anybody in the world at

00:47:50

a better price you sell to us of of the

00:47:52

countries that have money.

00:47:53

>> Right.

00:47:54

>> Right. We're not talking about if you

00:47:55

sell it to subsahara Africa. We're

00:47:56

talking about, you know, the the the big

00:47:58

countries, the OECD, you know, let's say

00:48:00

call it the big 10 or the big 20.

00:48:04

Charge us the same

00:48:06

and reshore

00:48:09

and I'll wave your tariff while you're

00:48:13

reshoring provided you do those two or

00:48:17

hammer.

00:48:19

Just hammer. And what's a hammer mean? I

00:48:21

don't know. Hundreds of percent tariff

00:48:24

starting I don't What do you think 30

00:48:26

days from now? Like just bang. So,

00:48:29

>> so you were just there in the corner.

00:48:30

[laughter]

00:48:31

They just see just

00:48:33

>> I'm like the handsome guy in the back

00:48:34

just going to you know like so if you

00:48:37

see me at the meetings I'm like there

00:48:39

like but if you look at the uh pictures

00:48:44

that are put out everybody puts out the

00:48:46

picture of Bobby signing and me signing.

00:48:48

>> Right.

00:48:49

>> Right. You say what are you signing

00:48:50

Harry? I'm signing the no hammer rule.

00:48:53

[laughter]

00:48:54

So

00:48:56

the result is OMIC and Munjaro are on

00:49:02

Medicaid and Medicare for $149

00:49:08

instead of not on it,

00:49:10

>> right?

00:49:11

>> And generally for sale for thousands,

00:49:15

>> right?

00:49:15

>> So think about it. Instead of generally

00:49:17

for sale for thousands, everyone in

00:49:19

America can have it for 149 bucks. and

00:49:23

and that's going to reduce all I mean

00:49:26

it's going to change these drugs. We had

00:49:29

we [clears throat] had drug companies

00:49:30

say you know what

00:49:32

>> I'm just going to give it to you. One of

00:49:35

the drug companies Merc said they're

00:49:36

going to just give us their number one

00:49:38

drug in the world. Right.

00:49:39

>> They're going to give it to Medicaid

00:49:40

Medicare for zero.

00:49:42

>> Right.

00:49:43

>> Right. So we saved 25 35 billion dollars

00:49:47

a year. But more importantly,

00:49:49

we made drugs accessible

00:49:53

to America at a fair price and stop

00:49:56

always being the one who pays.

00:49:59

We are the richest country in the world

00:50:02

and the world viewed us. remember when I

00:50:05

was growing up, uh, there were all these

00:50:07

cartoons on TV and there was always this

00:50:10

one where there was a guy stuck on a

00:50:13

desert island and he looks at the other

00:50:15

guy and as the other guy walks by, he

00:50:17

starts looking at him. He looks like a a

00:50:19

big chicken leg, you know, he's like

00:50:20

starving. So, he looks at the other guy,

00:50:22

he sees him like I mean, the world views

00:50:25

us as a giant chicken leg,

00:50:29

>> you know, that they should just we're so

00:50:31

rich we won't miss it. And so they all

00:50:35

the trade deals were bad, the drug deals

00:50:37

were bad, the you know you can go

00:50:41

chapter and verse the immigration system

00:50:44

is the most ridiculous thing. Imagine we

00:50:49

are the richest most successful country

00:50:51

in the world and we give a lottery.

00:50:55

A lottery.

00:50:57

So let's say we have a lottery to come

00:50:58

into America. If you win the lottery,

00:51:02

you win,

00:51:03

>> right?

00:51:03

>> But who's paying for the lottery?

00:51:06

>> We are. So, it's not like, you know, the

00:51:09

normal lottery, everybody pays in a

00:51:10

dollar and the winner gets x% of the

00:51:13

money,

00:51:13

>> right?

00:51:14

>> Here, the people win the lottery and we

00:51:17

lose,

00:51:18

>> right?

00:51:18

>> Like it's it's like a win-lose and

00:51:21

that's like and you would say, gosh, why

00:51:25

would we do that?

00:51:26

>> Yeah. And it's only because Donald Trump

00:51:29

is willing to literally challenge

00:51:34

why are we doing this? Why are we doing

00:51:36

that? Why are we doing this? Why are we

00:51:37

doing that? He has incredibly capable

00:51:40

people around him who are willing to

00:51:42

challenge it and then come up with a

00:51:44

better answer, attack that better answer

00:51:47

and deliver the outcome. Meaning just

00:51:49

talking about it, as I said in the

00:51:50

beginning, doesn't count. Yeah,

00:51:51

>> you either change the immigration

00:51:53

system, you change the price of drugs,

00:51:57

you change the trade deficit which have

00:52:00

which is awesome, right? You change the

00:52:03

budget deficit of the country down $600

00:52:06

billion dollar this year. You just you

00:52:09

just relentlessly deliver.

00:52:12

What happens is if you have a

00:52:13

businessman in that office and and

00:52:16

Donald Trump has the best intuition of

00:52:19

anybody I've ever met. I could tell you

00:52:22

stories and stories of just like one day

00:52:24

he said to me u I don't know maybe we

00:52:26

talked about it last time. What's the

00:52:28

what's the flag on the back of those

00:52:29

ships?

00:52:32

And I was like I don't know. He goes you

00:52:34

ever seen a flag on the back of a ship

00:52:35

that you know where it was from? I was

00:52:38

like no. He goes why is that? And then

00:52:40

you look it up and the number one flag

00:52:43

on the back of a ship is Liberia.

00:52:47

All these ships, like all the tankers,

00:52:49

>> all the tankers, cargo ships. And why is

00:52:52

that?

00:52:52

>> It's a tax scam.

00:52:55

It's a flag of convenience,

00:52:57

>> right?

00:52:57

>> And then what they do is they then so

00:53:00

they make all their money on the seas

00:53:02

and they charge the port is an expense,

00:53:06

right? So they pick it up from Europe.

00:53:08

It's an expense. They drop it off in

00:53:09

America. That's an expense. And all

00:53:11

their profits are on the high seas where

00:53:12

they pay no tax. Right. So what do you

00:53:14

think they do? Then they buy the ports.

00:53:16

>> Right.

00:53:17

>> Right. It's all a tax scam. So the

00:53:19

president

00:53:21

by intuition

00:53:24

sends us out like he sends me out. He

00:53:26

loves to send me out stuff because, you

00:53:28

know, I I just love the stuff and I find

00:53:29

it. And uh and we're going to attack it.

00:53:34

The next year you're going to see this

00:53:37

government attack fraud.

00:53:39

And the fraud is probably a trillion

00:53:43

dollars a year of people who just have

00:53:47

figured out how to rip off the system.

00:53:50

And

00:53:52

the system, remember, America had open

00:53:54

borders till 1914. The reason it had

00:53:57

open borders in 1914 is because it gave

00:54:00

you nothing,

00:54:01

>> right? So like if you were sick, you

00:54:04

couldn't go to the hospital unless you

00:54:05

could pay the bill,

00:54:06

>> right?

00:54:06

>> So if you were sick, you you die. What

00:54:08

do you want from me, right? Get a job,

00:54:10

take care of yourself, or get lost,

00:54:12

>> right?

00:54:13

>> And when we went to have a welfare

00:54:17

state, you have to close the borders

00:54:20

because if the people are going to give

00:54:22

their money, they need to give it to

00:54:25

each other. You can't really open the

00:54:27

border and say, "I'm going to give my

00:54:28

money to anybody who wants to come in."

00:54:30

Right? that's getting it wrong. So when

00:54:33

people say open immigration is how we

00:54:37

built America,

00:54:39

they are right. And open immigration

00:54:42

would be something interesting if we

00:54:44

gave people nothing. Cuz if we gave them

00:54:48

nothing, if they weren't smart enough,

00:54:50

capable, uh, entrepreneurial enough,

00:54:53

driven enough,

00:54:54

>> Mhm.

00:54:54

>> they would starve to death. And so they

00:54:56

wouldn't stay here. They would

00:54:58

self-deport.

00:55:00

>> Right. But if you're going to give them

00:55:01

welfare and you're going to give them

00:55:03

food stamps and you're going to give

00:55:04

them housing and you're going to give

00:55:05

them this that, then everybody's going

00:55:07

to come and just leech off of us and

00:55:10

we're going to pay and pay and pay until

00:55:15

now in the on this immigration side,

00:55:17

you've launched two versions of the

00:55:20

Trump card, I think, right? There's the

00:55:22

million dollar Trump card and then the

00:55:25

$5 million card. Where are those

00:55:27

programs and how have they been working

00:55:28

so far? So there it's out right now,

00:55:31

trumpcard.gov.

00:55:33

It's a really nice website. And what

00:55:35

happens is the idea is to stop letting

00:55:40

people into the country without a clear

00:55:44

benefit to the country. Right. You

00:55:47

should come in if you're going to give

00:55:48

us a clear benefit to the country. Like

00:55:50

it should be black and white.

00:55:51

>> Not you. Yeah.

00:55:52

>> Right. You're going to help us.

00:55:53

>> Yeah. So the average green card, if you

00:55:55

looked for the last 5 years, the average

00:55:58

American makes in the $60,000

00:56:01

a year and the average green card

00:56:03

recipient made in the 40s.

00:56:06

So we are bringing in the bottom

00:56:08

cortile,

00:56:09

>> right?

00:56:09

>> Like what? Why? We're the only country

00:56:12

in the world who was bringing in the

00:56:15

bottom. more likely to be on welfare,

00:56:18

more likely to be on uh uh food stamps,

00:56:20

more likely to, you know, on sub, you

00:56:23

know, getting stuff from the government

00:56:25

because they were all coming to get

00:56:27

stuff from the government,

00:56:28

>> right?

00:56:29

>> And so the idea for us is, okay, here's

00:56:32

the gold card. you want to come in,

00:56:35

prove to us you're going to make a

00:56:36

benefit to this country, give the United

00:56:39

States a million dollars, which pays off

00:56:41

our deficit, reduces

00:56:44

taxes we have to charge Americans, and

00:56:46

then you come in, you've proven that

00:56:49

you're going to be a good citizen. We

00:56:51

have to vet you. We spend 15,000 on the

00:56:53

greatest vet we've ever done. And then

00:56:55

you come in and you're going to be top

00:56:57

Cortile, maybe top Desa,

00:56:59

>> right? But you're going to help America

00:57:02

be better.

00:57:02

>> Have you announced how many people have

00:57:04

applied or the first batches yet that

00:57:06

have been granted this? Not yet.

00:57:08

>> No, the president the president the

00:57:09

first week uh put out that we had sold

00:57:12

uh a billion dollars worth

00:57:14

>> in the first week.

00:57:14

>> Yeah.

00:57:15

>> Oh, wow.

00:57:15

>> So,

00:57:17

but that's a but there's a process and

00:57:20

that this process is going along

00:57:24

fixing the immigration system, right?

00:57:28

Not letting people come in by lottery,

00:57:31

selecting who they are, not bringing in

00:57:33

people who would take a trainee job,

00:57:36

right? People who graduate universities

00:57:39

around the world and people who graduate

00:57:41

>> Yeah. I mean, look, I think H-1B is

00:57:44

fantastic for someone who makes $500,000

00:57:47

who's a cool engineer,

00:57:49

>> but it's not okay if it's a $60,000

00:57:52

college graduate.

00:57:54

>> Hire from the universities of America.

00:57:56

don't hire from the universities of the

00:57:58

world. It just doesn't make sense. And

00:58:01

what happens is people steal the history

00:58:04

of America

00:58:06

and they lie, change the peace shape and

00:58:10

try to stick in it by saying, you know,

00:58:12

America was born with, you know,

00:58:15

immigration and open. Yes, that's when

00:58:17

we gave nothing. But if you're going to

00:58:20

give everybody the gift of America,

00:58:23

we better get something back. And that's

00:58:25

why you're hearing about all this fraud.

00:58:26

These people came in in order to defraud

00:58:30

America. It's not it's not like a random

00:58:32

act,

00:58:33

>> right?

00:58:34

>> They figured this is the richest country

00:58:36

in the world. We live in a crap hole.

00:58:39

Let's get out of here and these morons

00:58:42

are going to let us have a BMW,

00:58:44

>> right?

00:58:44

>> And we're not going to be hardworking

00:58:46

industrious people. We're just going to

00:58:49

figure out the model and screw them. And

00:58:51

America was not designed

00:58:54

with walls and barriers. We were

00:58:57

designed with an entrepreneurial spirit

00:59:00

>> to make the world shine.

00:59:02

>> You know, that's who we are. We are, you

00:59:04

know, when I when I give talks,

00:59:07

I say if you want to understand the

00:59:10

greatness of America,

00:59:13

close your eyes and imagine a world

00:59:15

without America.

00:59:17

It's dark.

00:59:18

>> Yeah.

00:59:18

>> Really dark. Now open your eyes and say,

00:59:22

"What makes the world shine when America

00:59:26

is shining the brightest?" So you'd say,

00:59:29

"Well, if that's true, America reset the

00:59:32

world order of trade, right? And

00:59:35

properly set the balance where since

00:59:37

we're the best economy, we're in the

00:59:39

best position." And so if you're right,

00:59:41

Howard, and the world shines brighter,

00:59:44

when America shines brighter, then even

00:59:48

though the world's paying America,

00:59:51

they should be in better shape.

00:59:52

>> Yeah.

00:59:53

>> Korean stock market up 70%.

00:59:56

Japan up like 20s or 30s. Europe up more

01:00:01

than 15, right? All of these up.

01:00:05

And you'd say, "Well, I don't

01:00:06

understand. How could they pay us and be

01:00:08

up?" Because cuz the world and and you

01:00:12

know stocks are a long-term outcome.

01:00:15

>> That's right.

01:00:16

>> Right. And the long-term outcome is if

01:00:18

the United States is powerful and strong

01:00:20

and creating the greatest weapons in the

01:00:23

world and selling us the greatest

01:00:24

weapons in the world and protecting us

01:00:25

and defending us and building an economy

01:00:27

that we can rely upon and trust upon,

01:00:30

our companies are going to do great.

01:00:31

>> Yeah.

01:00:31

>> They're going to do great.

01:00:32

>> This is an excellent point that no one

01:00:34

has actually made. the narrative that

01:00:35

the media has been trying to paint

01:00:36

recently is this is a debasement problem

01:00:39

for the US dollar. But I actually think

01:00:40

what you said is more accurate, which is

01:00:43

what people looked through were the

01:00:44

tariffs and saw a level of economic

01:00:46

resilience in these other markets that

01:00:48

made them very attractive in a way that

01:00:50

they weren't attractive at the current

01:00:52

course in speed. That's why Korea did so

01:00:54

well, Japan did so well, Europe did so

01:00:56

well. It's why a lot of these base

01:00:57

commodities did well because now you're

01:00:59

seeing an increasing of demand because

01:01:01

you're going to see production capacity

01:01:03

all over the country. It was a huge

01:01:05

change actually. It really resets how

01:01:07

capitalism and capital markets will

01:01:09

work. I don't know if it was an intended

01:01:10

unintended consequence, but it's a very

01:01:11

positive consequence. I want to talk

01:01:14

though about what you just said about

01:01:15

2026. You said we will be surprised at

01:01:18

the level of

01:01:20

focus that you and the president put on

01:01:23

fraud and you think there's a trillion

01:01:25

dollars. Can you just double click into

01:01:27

what that means, how you're going to go

01:01:29

after it, and

01:01:32

is it at the federal level, at the state

01:01:33

level, just kind of give us the rough

01:01:36

game plan, what you can say.

01:01:37

>> Sure. So, the president is the federal,

01:01:41

>> right? So, if if the federal government

01:01:43

gives money to the state and the state

01:01:46

gives it out, then we have a dog in the

01:01:49

hunt,

01:01:50

>> right?

01:01:50

>> Okay. If it's their money and they're

01:01:52

giving it out, we don't really have a

01:01:53

dog in the hunt. But we have a dog in

01:01:56

almost every hunt because [laughter]

01:01:57

they take the federal money, it goes in,

01:01:59

you know, and then they administer

01:02:01

welfare. But it comes from it comes from

01:02:03

us. So this is

01:02:05

>> the success we had in pharmaceuticals

01:02:09

was the commerce department and HHS

01:02:13

working together in a way that these

01:02:16

departments have never worked together

01:02:18

before. that he understood my power and

01:02:21

I understood his power and together we

01:02:24

changed the outcome to incredible

01:02:27

success. So that's how we're going to

01:02:30

look at it. We're going to have a

01:02:33

multiple departments working together,

01:02:37

right? No one has ever looked

01:02:40

at if you're getting Medicaid and

01:02:43

Medicare, how much money do you make?

01:02:48

No one's ever compared the two.

01:02:49

>> Really?

01:02:50

>> Yeah.

01:02:51

>> Yeah. You're supposed to tell us,

01:02:54

>> but if you're a pro,

01:02:55

>> it's the honor system.

01:02:56

>> Yeah. But the world of America is built.

01:03:01

But now with modern technology,

01:03:03

>> right?

01:03:04

>> And then you have a beast like me.

01:03:06

>> Right.

01:03:06

>> Right. The hammer

01:03:07

>> and and and

01:03:09

probably the guy with the best intuition

01:03:11

in the world sitting right over there

01:03:13

who's also a businessman.

01:03:15

>> Right. and you know we'd say okay we're

01:03:18

going to build the technology to do this

01:03:21

we are going to build it and everybody's

01:03:24

on board so you have the ths

01:03:28

you have HHS

01:03:30

you have commerce right we're all

01:03:31

working together and we are going to

01:03:34

come out with models and methods to seek

01:03:38

the fraud out and not on a limited to

01:03:42

Minnesota scale oh No, we're going to go

01:03:46

after it big time, right? And you have

01:03:50

so you have that on one side and then

01:03:52

you have the execution

01:03:55

of the first year in the second year,

01:03:57

which means you have the president

01:03:59

saying we have $18 trillion of committed

01:04:01

capital. Okay,

01:04:04

open your plant. We have spreadsheets. I

01:04:06

went over them yesterday, right?

01:04:08

>> We have spreadsheets of promises,

01:04:10

>> right? All these people who made these

01:04:12

promises, okay, call them. 30

01:04:17

construction projects launched that

01:04:20

would never have been launched. So

01:04:23

here's my view.

01:04:25

>> I told you that I thought in the end of

01:04:28

this year we would get to 4% GDP growth.

01:04:32

I said it in the first quarter. Yeah.

01:04:34

>> And 4.3. Now the fourth quarter is going

01:04:37

to be uh a mess because of the shutdown.

01:04:40

Seriously, this is accounting in

01:04:42

America. If someone works for the

01:04:44

government, they count them as GDP.

01:04:49

And you would say right that face

01:04:51

exactly make you go what? So, so let's

01:04:54

get Wait, stop, stop, stop. So you hire

01:04:56

someone in your department, GDP just

01:04:59

went up even though they don't do

01:05:00

anything. I thought GDP would be like if

01:05:03

you make a something

01:05:05

>> like you do something. Nope.

01:05:07

>> So, here's the fun part. When you furlow

01:05:10

them

01:05:13

uh on the shutdown, right? You're still

01:05:16

paying them. That's the deficit. But

01:05:19

they're not actually working at the

01:05:21

government, so they're not productive.

01:05:23

So, they take it away from GDP. And

01:05:26

you'd say, "This is actually like the

01:05:28

silliest thing in the world. You're

01:05:29

giving the guy the same amount of money.

01:05:30

What's the difference? But these are the

01:05:33

rules. So our fourth quarter GDP will be

01:05:36

a point and a half lower than it

01:05:38

otherwise would be for this oddity.

01:05:41

>> Just the furlow. That's basically so

01:05:44

like like the common economists think

01:05:47

the fourth quarter growth is going to be

01:05:48

a point. Okay. They're just like wrong.

01:05:52

I said they were wrong in the third

01:05:54

quarter. I said they were wrong in the

01:05:55

second quarter. We have a 3.8 and then

01:05:57

4.3. We'll probably be like 2 and 1/2.

01:06:00

But that would have been to your point

01:06:01

four

01:06:01

>> four

01:06:02

>> right

01:06:03

>> next year with all this construction in

01:06:04

the ground like this Friday I'm flying

01:06:06

up to New York to a uh two microns

01:06:10

groundbreaking of their tens of billions

01:06:12

of dollar factory in upstate New York

01:06:15

that's just another example right then

01:06:18

I'm going to Detroit where they're doing

01:06:20

a huge you know new build uh new new

01:06:23

auto plant and they're building their

01:06:25

engine plant and it's just

01:06:29

fives. You're going to see fives fives

01:06:32

in the greatest economy in the world.

01:06:36

You're going to see fives.

01:06:39

And people think you can't you can't

01:06:42

>> 5% GDP on a base this big is just it's

01:06:45

enormous.

01:06:45

>> We have a $30 trillion. So 5% is 1.5

01:06:48

trillion in growth. And if we cut rates,

01:06:54

you'll see sixes.

01:06:56

And people do not would never before

01:06:59

Donald Trump walked into that office

01:07:00

they would don't think that's possible.

01:07:02

And what's six mean?

01:07:03

>> Let's just put six in context. Six was

01:07:06

China at its peak under central planning

01:07:10

with a tight control on every aspect of

01:07:13

its economy. That was what the world

01:07:15

knew is what six looked like in the

01:07:17

modern era. And now the alternative

01:07:19

version of six will be the president,

01:07:21

you, the team in a much more open way.

01:07:25

I'll be shocked.

01:07:25

>> You would have said it could never

01:07:26

happen.

01:07:26

>> I would be shocked. I mean, that's an

01:07:28

incredible

01:07:28

>> Okay, you're gonna put it this way. You

01:07:30

know, it wouldn't even be fun for you

01:07:32

when we see the fives.

01:07:33

>> Yeah,

01:07:33

>> because they'll be so soon. They could

01:07:35

be this quarter as in the first quarter.

01:07:37

So then I'd say, "Well, you have to come

01:07:38

back and see me when it's five." But

01:07:40

then you'll come back in a couple of

01:07:41

months. And then you'd say, "Howard, I

01:07:42

just spoke to you for an hour. I don't,

01:07:44

you know, I don't need to speak to you

01:07:45

again." But you're going to see fives

01:07:46

like as in early in 26.

01:07:49

>> That's incredible.

01:07:50

>> And then if they cut rates, and that's

01:07:52

the thing. I need a new Fed chair who

01:07:55

cuts rates. And if they cut rates,

01:07:57

>> sixes.

01:07:58

>> You'll see sixes. And what you're going

01:07:59

to see, what that means is jobs are

01:08:03

abundant.

01:08:03

>> Yeah.

01:08:04

>> Good jobs are abundant. Highpaying jobs

01:08:06

are abundant, right? Construction jobs,

01:08:08

you just get paid more money to be who

01:08:11

you are. You make more money. And that

01:08:14

is not inflation. That is called 6% GDP

01:08:20

growth. See, if if we have no growth and

01:08:22

I pay you more because you demand more,

01:08:25

that's inflation. It's right. But if I'm

01:08:28

like trying to build a factory cuz I'm

01:08:30

kicking tail and and I have to share

01:08:32

some of my profits with you to convince

01:08:34

you to come to work.

01:08:35

>> Well, I'll give you a perfect example of

01:08:36

this. I am the lead investor in a one

01:08:39

gigawatt data center project in Arizona.

01:08:42

We have to pay electricians between $500

01:08:45

and $750,000 a year, which is more than

01:08:49

what we pay the engineers that work at

01:08:51

the models

01:08:53

out of Facebook. But it's an example to

01:08:55

your point of just the economy has

01:08:57

created earnings potential across the

01:08:59

board in ways that I've never seen in my

01:09:01

career. It's really quite incredible.

01:09:03

>> The society

01:09:06

under Obama,

01:09:08

the Obama view of the country, he blew

01:09:11

it, right? He got rid of shop class.

01:09:14

When I when I grew up, you you know took

01:09:16

shop class. Totally.

01:09:17

>> There were things to use with your

01:09:19

hands.

01:09:19

>> Yeah.

01:09:20

>> And then we sort of ruled that out in

01:09:22

America.

01:09:24

>> Said you got to go to a liberal arts

01:09:25

college.

01:09:26

>> You have to end up with $200,000 in

01:09:28

debt,

01:09:29

>> right? And then these people thought

01:09:31

like, what job am I getting that gets me

01:09:33

to pay off my $200,000 in debt? it, you

01:09:36

know, and then you you have Biden jams

01:09:38

in inflation, so the price of a house

01:09:40

goes up, and then the American dream

01:09:43

sort of slips further and further away.

01:09:45

>> Yeah.

01:09:46

>> And you get Donald Trump saying, "Okay,

01:09:48

the way to fix it is, I need to get the

01:09:51

people working with their hands, 6

01:09:54

million Americans sitting on the

01:09:55

sidelines because the jobs are not the

01:09:57

right jobs for them. Get them out.

01:10:00

Technicians, fix robotics."

01:10:03

>> Yeah.

01:10:03

>> Right. I had I went out to Arizona to

01:10:06

the TSMC plant and I met the uh these

01:10:09

guys were pipe fitters. I met a pipe

01:10:12

fitter and I said, "So, how's your job?"

01:10:14

He goes, "I play Tetris every day." He

01:10:18

goes, "I've got to get these kind of

01:10:19

pipes through this kind of thing and

01:10:21

this kind of way. I got they give me

01:10:22

this much space and I got to do all this

01:10:24

thing." He goes, "I have the greatest

01:10:26

job ever."

01:10:27

>> Can I tell you something about that TSMC

01:10:29

plant? That's a 4 nanometer plant. They

01:10:31

are at better yields or equivalent

01:10:33

yields than the best operating for

01:10:36

nanometer plant in the world which is in

01:10:37

China. Isn't that incredible? American

01:10:39

technicians are now dollar for dollar as

01:10:42

good as what was happening in China.

01:10:44

It's incredible.

01:10:45

>> Nobody knows this by the way, but it's

01:10:46

incredible.

01:10:47

>> So TSMC when I when I walked in there

01:10:50

was this chips act.

01:10:51

>> Mhm.

01:10:52

>> Okay. So the chips act had $52 billion

01:10:57

because we made no chips in America.

01:10:59

Semiconductors.

01:11:00

>> Yeah. By by the way, so so just as a

01:11:02

sort of a fun story, a wafer, these are

01:11:05

things, you know, but a wafer is the

01:11:07

size of a like a pizza you get in a

01:11:10

restaurant.

01:11:10

>> Yeah.

01:11:10

>> It's like a personal pizza. Small pizza.

01:11:12

Yeah. Exactly.

01:11:12

>> Yeah. It's like a 12-in pizza. Okay. And

01:11:14

then what they do is they break it

01:11:17

>> in little chips.

01:11:18

>> Yeah.

01:11:18

>> And that's why it's called the

01:11:19

semiconductor chip. They literally like

01:11:21

chip it.

01:11:22

>> Yeah.

01:11:22

>> Right. So, the beauty of AI, like these

01:11:26

GPUs that Jensen builds from Nvidia, is

01:11:30

instead of making 4,000 little chips out

01:11:33

of that pizza, they make 10.

01:11:36

These are big things. Like this thing's

01:11:38

the size of a refrigerator, like you

01:11:40

think of a chip, think of the little

01:11:42

teeny thing going in your iPhone, right?

01:11:44

And these things are the size of a

01:11:45

refrigerator, right? And um so it's it's

01:11:48

a different kind of model, but

01:11:52

you know they had they they gave Intel

01:11:55

$10 billion gave G.

01:11:58

>> Yeah. Actually, let me just stop there

01:11:59

because I think one of the things that

01:12:00

you did, you basically just put a pause

01:12:03

on the chips act and ripped it apart and

01:12:05

restarted it effectively

01:12:07

>> because it was initially under Biden

01:12:09

again just as an outsider looking at it.

01:12:12

It was largely giveaways

01:12:14

>> and I think you flipped it around and

01:12:15

you essentially said stop. My

01:12:17

understanding is you actually haven't

01:12:19

you've committed to a lot but you've

01:12:21

been pretty judicious and disciplined

01:12:23

about giving the money out. I think only

01:12:25

6 billion has gone out because there's a

01:12:27

bunch of conditions and you have to

01:12:28

actually meet these milestones and the

01:12:30

chips act is is very different than how

01:12:32

it started.

01:12:33

>> So is that fair?

01:12:35

>> Yeah. cuz the Biden administration

01:12:37

viewed the $50 billion as I'll give you

01:12:40

10%.

01:12:42

You build a $16 billion plant, I'll give

01:12:44

you $6 billion.

01:12:46

And uh

01:12:47

>> and why does that not work? Like why why

01:12:49

would that not have worked or why was

01:12:50

that not working when you came in?

01:12:52

>> Why would you give $6 billion to TSMC,

01:12:57

which is Taiwan Semiconductor

01:12:59

Manufacturing Corporation, when their

01:13:01

stock is worth a trillion,

01:13:03

>> right?

01:13:04

So what Donald Trump does is says, "Hey,

01:13:07

hey, how about this? How about this?

01:13:09

I'll charge you a 100% tariff. How about

01:13:11

that?" And then the guy says, "Okay,

01:13:13

I'll build an America." See, I don't

01:13:14

have to give you six billion. Like, you

01:13:16

know, Donald Trump can dissect it.

01:13:18

>> Yeah.

01:13:18

>> Right. In a paragraph.

01:13:20

>> Yeah.

01:13:20

>> In a paragraph.

01:13:22

>> Right.

01:13:22

>> So, what we did is we we said to TSMC,

01:13:26

"Look,

01:13:28

you signed the contract. There's 20

01:13:30

pages of DEI stuff in it. You need to

01:13:32

hire a blind. Oh, you have to hire a

01:13:34

blind contractor. You have to have like

01:13:38

uh you know trans lesbian engineers. I'm

01:13:42

not kidding by the way. And you know, so

01:13:44

think about the Taiwan Semiconductor

01:13:46

Manufacturing Corporation, right? How

01:13:48

many lithography

01:13:50

engineers does Taiwan have that are

01:13:53

female, let alone what their sexuality

01:13:57

choices are?

01:13:58

>> Right?

01:13:58

>> They've never had a female. They're all

01:14:00

men. Right.

01:14:01

>> So I said, "Listen, you're in breach,

01:14:04

>> right? Everybody thinks like a

01:14:05

Republican will just rip that stuff up."

01:14:07

Not this kind of Republican. This kind

01:14:08

of Republican reads the contract and

01:14:10

says, "You know, you

01:14:12

>> you're in the DEI.

01:14:13

>> You didn't build a daycare center in the

01:14:16

middle of your clean room fab."

01:14:19

Like, you signed that contract. So

01:14:21

you're in breach. Okay. So how about

01:14:22

this? How about I add 100 billion?

01:14:26

So instead of building 60 billion, you

01:14:29

build 160 billion,

01:14:31

>> right?

01:14:32

>> And we agreed. So I feel better.

01:14:35

>> And then do you wave the DEI

01:14:36

requirements? Yeah.

01:14:38

>> Hey, build another hundred billion. We

01:14:39

can rip that stuff up. No problem. So

01:14:42

what happens is you now have a $165

01:14:45

billion plant going in. And I think I'm

01:14:48

going to let TSC TSMC announce it, but

01:14:52

they are going to get much bigger even

01:14:55

from the 165 billion. The And this is

01:14:57

remember this is a factory.

01:14:59

>> Yeah.

01:15:00

>> That makes the stuff that Nvidia sells

01:15:03

for five times higher.

01:15:05

>> Okay, let's talk about Nvidia for a

01:15:06

second. You did a deal at the end of

01:15:07

this year. I don't think we've ever seen

01:15:09

a deal like this. And you can tell me if

01:15:10

it's wrong,

01:15:12

>> but you control the export licenses and

01:15:14

as you said, Jamath, we don't want to

01:15:17

our adversaries to get the most advanced

01:15:19

silicon which makes sense

01:15:22

and then you struck an agreement with

01:15:23

Jensen where now I think it's the H200s

01:15:27

>> which are not quite the most advanced

01:15:28

chips but maybe one generation before

01:15:30

can go to China

01:15:31

>> advanced at what China makes

01:15:33

>> right but in return you got a 25%

01:15:38

marketing fee what do you kind of rev

01:15:40

share

01:15:41

>> tariff

01:15:42

>> tariff just describe to us the

01:15:44

construction of that deal and what it

01:15:47

means for these kinds of deals in the

01:15:50

future.

01:15:50

>> So Jensen Wang who runs Nvidia is you

01:15:55

obviously a businessman of extraordinary

01:15:58

capacity. You can't run a $5 trillion

01:16:00

company unless you're like

01:16:01

>> incredibly impressive.

01:16:02

>> Impressive. So he comes in and and I

01:16:06

promised him in the beginning when I

01:16:08

first met him that I would help him have

01:16:11

really easy access to the president

01:16:15

because he's a national treasure.

01:16:17

>> Yeah.

01:16:18

>> Right. And and our great companies are

01:16:20

national treasures for America. So, so

01:16:23

he his argument to the president, you

01:16:26

could buy it or not, is that if you shut

01:16:29

off China entirely,

01:16:31

then all of their n all of their

01:16:34

economics go to their national champion

01:16:38

to build new stuff and all their

01:16:40

economics go to that company and that

01:16:43

helps that company grow. And that if you

01:16:46

give them better than what they have,

01:16:49

you don't have to give them your best.

01:16:51

You just have to give them better than

01:16:52

what they have.

01:16:53

>> Mhm.

01:16:54

>> Right. This is his argument. Then

01:16:56

they'll give less to their champion,

01:16:59

>> right?

01:17:00

>> And more to you and and it it'll have a

01:17:04

positive economic relationship with

01:17:07

China and positive for us overall. Now,

01:17:12

there are plenty of people who disagree,

01:17:15

right? But that was Jensen's argument

01:17:19

and that was the discussion, the

01:17:22

argument, the debate that we had. And

01:17:25

then when that was done

01:17:28

and over, then the president said, "And

01:17:30

you got to give me 25%." So the 25% was

01:17:34

a throwaway,

01:17:35

>> right?

01:17:35

>> But it was like, "Look, if I'm doing all

01:17:37

this for you, you still got to give me

01:17:38

25%." So the way we're doing it is he

01:17:42

has to send the chips to America.

01:17:46

We test the chip to make sure that he

01:17:48

hasn't enhanced it in any way.

01:17:50

>> Okay?

01:17:50

>> Cuz the H20 was oddly enhanced. You know

01:17:54

that it had it had less flops but more

01:17:57

>> memory. In fact, it had more memory than

01:17:59

the H100 which one could argue was a

01:18:02

little you know not everybody knew that.

01:18:05

Say it that way. So we test it

01:18:09

on the way in. We can charge it a tariff

01:18:11

just regular [snorts] 25% tariff and

01:18:13

then we give export licenses to who he

01:18:16

wants

01:18:16

>> and then he sends it to China and then

01:18:17

>> and he sends it to China or he sends it

01:18:19

to you know whoever he's selling it to.

01:18:20

So I think we the president

01:18:25

this is the president's deal and and my

01:18:29

job is to make sure all the smart people

01:18:33

are in the room with with both opinions.

01:18:36

>> Okay?

01:18:36

>> Never let one opinion you people think

01:18:38

oh the last person who met Donald Trump.

01:18:41

No they don't. Donald Trump hears so

01:18:44

many different views that often he'll

01:18:48

call the person he likes that he's going

01:18:51

to go with the last one before he gives

01:18:53

it cuz that makes sense. Like if I'm

01:18:55

going to say yes to you. Yeah.

01:18:56

>> Right. I'm saying no to him but I'm

01:18:58

saying yes to you. So what a shock. I

01:19:00

call him and say no and then I call you

01:19:01

and say yes and [laughter] they'd say,

01:19:02

"Oh, he called Shamath last and that's

01:19:04

why you stop."

01:19:05

>> Yeah. Yeah.

01:19:06

>> So that was, you know, Jensen did a

01:19:11

great job making the case and convincing

01:19:14

the president of United States who has a

01:19:16

very very detailed and nuanced view

01:19:19

about China and not everybody agrees

01:19:22

with him.

01:19:23

>> Right. But you know my take on having

01:19:26

worked closely been his friend for 30

01:19:28

years but been worked closely with him

01:19:30

this year is

01:19:33

he does have the best intuition of

01:19:34

anybody I've ever met in the whole wide

01:19:37

world and when he thinks it's okay and

01:19:40

and I know he's had full information

01:19:45

right and he makes he makes really

01:19:50

>> when you make strong decisions you might

01:19:52

disagree Yeah.

01:19:53

>> Doesn't always agree with me.

01:19:54

>> Yeah.

01:19:55

>> But it's a strong

01:19:57

decision which has deep base thought and

01:20:01

balance to it. And he's done that, you

01:20:04

know,

01:20:05

every time. And it's it's amazing. He he

01:20:09

does play a better game of chess. He

01:20:13

just does play a better game of chess.

01:20:14

And that's why it's so fun for me

01:20:15

because, you know, I I was very

01:20:18

successful in business and and in my

01:20:21

companies which had I 13,000 employees

01:20:24

like I was the one up here.

01:20:26

>> Yeah.

01:20:26

>> And for me to work for somebody

01:20:29

>> the bar is high. It

01:20:30

>> the bar had better be high. And he's

01:20:32

he's just the most fun to work for.

01:20:33

>> Do you think that the deals that we're

01:20:35

seeing so there's a 25% revure on the

01:20:37

H200's from Nvidia. You were able to get

01:20:40

I think 10% of Intel.

01:20:41

>> 10%

01:20:41

>> 10% of Intel. There there's a lot of

01:20:44

these deals where you could say all

01:20:45

these companies that are on the bleeding

01:20:47

edge of America, America's national

01:20:49

treasures, they need help that only you

01:20:52

or the president, the infrastructure of

01:20:54

America can provide.

01:20:57

Should America get something in return?

01:21:00

>> I think the way President Trump thinks

01:21:02

about it is that

01:21:06

if you can do it on your own, you do it

01:21:09

on your own. But if you really need his

01:21:12

help and you need him to open the door,

01:21:16

to drive the door, to change it, you

01:21:18

need America to make it happen for you,

01:21:21

isn't there something for the American

01:21:22

taxpayer there?

01:21:23

>> Right.

01:21:25

>> Right. Because if in the end, if we can

01:21:28

balance the budget,

01:21:30

then then he can take care of the people

01:21:33

who make less than $150,000 a year and

01:21:35

change America. And that's what he wants

01:21:37

to do. So he's looking for look why

01:21:41

would we give the money to Intel? It it

01:21:43

was given to Intel contract signed given

01:21:47

to Intel. So to turn that around to

01:21:50

where America owns 10% of Intel,

01:21:53

right?

01:21:55

That can fix use that money to fix

01:21:57

social security. Use that money to

01:21:59

reduce our deficit. Use that money to

01:22:01

charge less in taxes. Use the money to

01:22:04

make America great.

01:22:07

Right. And you know, look, I I think if

01:22:11

we get rid of the fraud,

01:22:13

that'll save the country a trillion

01:22:15

dollars.

01:22:15

>> Right?

01:22:16

>> If you figure out ways to make a

01:22:18

trillion dollars, you could reduce our

01:22:21

deficit or you could start the process

01:22:24

of solving social security.

01:22:28

Not like the scary part for me is if I

01:22:31

say the word social security, it it

01:22:33

doesn't matter what you say with the

01:22:35

word social security, they assume you're

01:22:37

taking something away from them because

01:22:38

every politician who's ever said social

01:22:40

security says I'm going to take

01:22:41

something away.

01:22:42

>> Yeah.

01:22:42

>> But the answer is

01:22:45

if you hit it with outside money and

01:22:48

just start hitting it with money that

01:22:50

you've made out here

01:22:52

[sighs and gasps]

01:22:54

and you fix it, you take nothing away,

01:22:56

>> right? And that's it. If we're the

01:22:58

richest country in the world, if we get

01:23:01

rid of the fraud and we can run America

01:23:05

smart,

01:23:07

we can do it all because we're the

01:23:09

greatest country in the world. Imagine

01:23:10

if you grow 6%. You're going to fix the

01:23:13

deficit. You're going to fix taxes.

01:23:15

You're going to fix mathematical. No,

01:23:16

it's mathematical. You start to do it.

01:23:18

You get full employment. You people get

01:23:20

paid. It's

01:23:22

>> I think we can win. And uh and that's

01:23:25

why I I can achieve the goal of being

01:23:29

the secretary who has the most fun

01:23:30

because I'm in the room where it

01:23:32

happens, right, with Donald Trump where

01:23:35

he thinks about things and he thinks

01:23:37

about them. And I was in a meeting

01:23:39

yesterday with him where there were like

01:23:41

eight advisors sitting around the, you

01:23:44

know, the resolute desk and he's on that

01:23:45

side and they all had this opinion and

01:23:48

he had it and he said, "No, no, that'll

01:23:52

have this derivative result and we're

01:23:54

not doing that."

01:23:57

And everybody in the room was like,

01:23:59

"He's right." I mean, you got eight guys

01:24:02

[laughter] saying like, you know, guys

01:24:03

and women thinking, you know, and he

01:24:05

just says it. I mean, he's he's he's

01:24:09

great. Great.

01:24:10

>> I have a one final question, which is an

01:24:12

audience question. It's from Brandon L

01:24:15

from New York, who asks, "Who is your

01:24:17

favorite child?" [laughter]

01:24:20

>> So, I have four kids. Okay. So, the the

01:24:25

joke in my house was I had the oldest,

01:24:29

it's my son Kyle. I had the youngest, my

01:24:32

son Ryan. I have my only daughter who's

01:24:35

my daughter Casey. So my son Brandon uh

01:24:39

would sign his birthday card, your

01:24:42

fourth favorite. Cuz he was neither the

01:24:44

youngest nor the oldest nor the

01:24:46

daughter. So he would sign your fourth

01:24:48

favorite. And whenever one of the other

01:24:50

kids screwed something up in one of the

01:24:53

funniest things you'd ever seen, me, my

01:24:55

wife and I would be sitting in our

01:24:56

bedroom and Brandon would come running

01:24:58

in and say third and he'd run back out.

01:25:03

[laughter]

01:25:03

And he was doing this when he was like

01:25:05

12, you know, so it's hysterical. So

01:25:07

that's that's a really a funny question.

01:25:09

And uh you know, I have I have the best

01:25:12

wife. Uh she's both you I've been

01:25:15

married 31 years. Uh, I love her to

01:25:18

death. She's she's just a wonderful

01:25:20

woman and a spectacular mom and uh we

01:25:25

have great kids, really smart, really

01:25:28

capable because, you know, great mom,

01:25:31

great mom, and uh and we're really

01:25:34

close. So, people ask me like, "Where'd

01:25:36

you go on vacation?" I said a simple

01:25:38

question. I asked my adult children

01:25:40

where they wanted to go, and that's

01:25:42

where we went. Yeah.

01:25:43

>> Because if I went somewhere else, they

01:25:44

wouldn't go with me.

01:25:45

>> Yeah. and I want them to be there. And

01:25:47

there was a picture of me with uh with

01:25:49

Bobby Kennedy in Aspen where there was

01:25:51

absolutely no snow. And so you say,

01:25:53

"Well, why did you go?" Said, "Because

01:25:55

my adult children are here and that's

01:25:56

where I [laughter] was." We both were on

01:25:58

the same uh

01:25:59

>> You're on the same train,

01:26:00

>> same page. So I think I think if you

01:26:02

have uh I I found the right girl for me

01:26:07

and and so I have the best family and uh

01:26:10

and it lets me do this and lets me be

01:26:14

completely committed uh to the

01:26:16

government and uh you know I was very

01:26:18

successful in business.

01:26:20

You know, I had whatever company that

01:26:23

did more than 10 billion dollars of

01:26:25

revenues a year, made lots of money, and

01:26:29

I don't have it anymore. I was I used to

01:26:31

joke that I was the only commerce

01:26:34

secretary who had patents, but I have

01:26:36

none cuz I had to I had [laughter] to

01:26:37

divest all of them. But I understand the

01:26:39

patent office. I understand I understand

01:26:42

business.

01:26:44

Donald Trump understands business. And

01:26:47

we have really really impressive people

01:26:49

in this cabinet who are fun to work with

01:26:52

and you are going to see great things in

01:26:54

the second year.

01:26:55

>> Howard Lutnik, thank you for joining all

01:26:57

in.

01:26:57

>> It was really fun talking.

01:26:58

>> Thank you.

01:27:00

>> All right, besties. I think that was

01:27:02

another epic discussion. People love the

01:27:04

interviews. I could hear him talk for

01:27:06

hours. Absolutely.

01:27:08

>> We crushed your questions in a minute.

01:27:09

We are giving people ground truth data

01:27:11

to underwrite your own opinion. What do

01:27:13

you guys think? That was fun. That was

01:27:14

great. [music] I'm going all in.

Episode Highlights

A Unique Experience on Air Force One
A behind-the-scenes look at the intense discussions and light-hearted moments on Air Force One during a critical meeting with world leaders.
“"While you’re napping, we’re trying to settle world peace."”
@ 02m 07s
January 09, 2026
Japan's Closed Market
Cars in Japan are Chevrolets, but they can't be celebrated due to cultural barriers.
“You can't come home with a Chevy and people think, 'Woo!'”
@ 21m 04s
January 09, 2026
Economic Chaos Model
China's overproduction strategy leads to dumping products at lower prices in foreign markets.
“Let's dump the overcapacity into America, right?”
@ 28m 24s
January 09, 2026
Tariffs and Domestic Production
Tariffs slow down foreign leverage and push for domestic production to prevent dependency.
“If we blink, they will sell below cost in America.”
@ 29m 21s
January 09, 2026
The Seesaw of Trade Deals
Navigating the complexities of international trade, one country often finds itself on the wrong side of the seesaw.
“Sometimes there’s that seesaw and people on just the wrong side of the seesaw.”
@ 40m 53s
January 09, 2026
Pharmaceutical Pricing Inequities
Exploring the disparities in drug pricing between the U.S. and other countries, highlighting the need for fairness.
“We’re paying $1,000 for a drug and everyone else is paying $175.”
@ 45m 19s
January 09, 2026
The Vision for Immigration Reform
Introducing the Trump card initiative aimed at ensuring immigrants contribute positively to the U.S. economy.
“Prove to us you’re going to make a benefit to this country.”
@ 56m 32s
January 09, 2026
Economic Resilience
The narrative of economic debasement is challenged by emerging market resilience.
“What people looked through were the tariffs and saw a level of economic resilience.”
@ 01h 00m 40s
January 09, 2026
Future GDP Growth Predictions
Predictions of 5% GDP growth spark excitement about the economy's potential.
“You’re going to see fives in the greatest economy in the world.”
@ 01h 06m 32s
January 09, 2026
The Shift in Job Markets
A focus on hands-on skills is reshaping job opportunities in America.
“Get them out. Technicians, fix robotics.”
@ 01h 09m 54s
January 09, 2026
The Power of Intuition
Discussing the remarkable intuition of a long-time friend and leader.
“He has the best intuition of anybody I've ever met.”
@ 01h 19m 33s
January 09, 2026
America's Greatness
A passionate declaration of America's potential and greatness.
“We're the greatest country in the world.”
@ 01h 23m 07s
January 09, 2026

Episode Quotes

Key Moments

Cabinet Secretary Goals03:19
Subsidized Machinery22:16
Investment Strategies31:50
Immigration Reform56:32
Economic Resilience1:00:40
5% GDP Growth1:06:32
American Greatness1:23:07
Family Commitment1:26:10

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