Feb. 5, 2025 - Dennis Prager Show
07:46
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| Welcome back to the Dennis Prager Show. | |
| I'm speaking to E.J. Antony, Ph.D., economist at the Heritage Foundation. | |
| Make sure you check him out online on X at Real E.J. Antony. | |
| And you spell Antony, A-N-T-O-N-I. So let me ask you this, E.J. I mean, given the fact that Trump has... | |
| Inherited a horrific economy. | |
| I feel like he's got a lot of digging to do. | |
| He's got to dig us out of the hole. | |
| Biden administration put us over $8 trillion worth of debt. | |
| I mean, obviously we got a drill, baby, drill. | |
| What are some other ways that, what are some other things, in your opinion, that Trump needs to do to bring this economy roaring back? | |
| Well, I think continuing the tariff fight has to be a big part of that. | |
| We forget that countries like Canada have a tremendous amount of tariff and non-tariff barriers on a lot of American producers, whether we're talking farmers or factory workers. | |
| In fact, one of the reasons why Trump chose that 25% rate, I think, was because that's roughly what China puts on a lot of our dairy farmers, for example, on a lot of our car exports. | |
| And so what he's really... | |
| What he's doing is essentially just trying to level the playing field. | |
| And if he can get a better deal via this tariff fight, then that's gonna make it easier for Americans to export our products around the world. | |
| You're going to see an increase in domestic production. | |
| That means an increase in employment. | |
| It also means faster real wage growth. | |
| So all of these things are very, very positive for the American worker. | |
| Another big push from this president is his deregulatory agenda. | |
| That's incredibly important because a huge chunk of the cost of living increase that we saw under the Biden administration actually didn't have anything to do essentially with monetary policy. | |
| A lot of it, believe it or not, just had to do with Bad regulatory policy. | |
| Biden effectively added tens of thousands of dollars in costs for the average American family. | |
| And if you look at something like The average manufacturing worker, Carl, while let's say the average manufacturing worker has a cost of about $50,000 or $60,000 in terms of their salary, and then another $50,000 in terms of benefit packages, well, you can add on another $60,000 or $70,000 in terms of regulatory cost burden that that employer effectively has to pay, right? | |
| That's a big number. | |
| And that's not a cost that the employee ever gets to see. | |
| It's just cost of... | |
| And so if you can roll back a lot of that burdensome and, frankly, ineffective regulation through the deregulatory agenda that Trump has already started to outline, that would have a tremendously positive impact for the American worker and also for the American consumer, because by bringing down business costs, you would bring down the final sale price on a whole lot of products and even services throughout the economy. | |
| So the tariffs, I mean, and you're a free market capitalist. | |
| I know this. | |
| I know this, EJ. So tariffs shouldn't scare Americans. | |
| I mean, we had Chuck E. Schumer out there fear mongering that beer was going to be a lot more expensive and guac was going to be too expensive to afford. | |
| For Super Bowl Sunday. | |
| So your reaction to that? | |
| I mean, as a free market capitalist, I mean, typically I hear the term tariff and I'm like, oh, I don't know. | |
| But obviously it's advantageous for us at this point in time. | |
| Well, it is, but both for economic as well as non-economic reasons. | |
| And look, Carl, this is where I part ways with a lot of my fellow economists, frankly. | |
| They get so bent out of shape talking about free trade. | |
| But why is it we only care about... | |
| Trade being free when it's international trade. | |
| What about domestic trade? | |
| If we are so gosh darn concerned about not taxing trade, why do we allow, for example, when I trade my labor, why do we allow that to be taxed? | |
| We call that the income tax. | |
| Why do we have domestic sales taxes? | |
| If we really want to be so concerned about reducing the tax burden when it comes to trade, then we should focus first on freeing our domestic trade and helping our fellow Americans before we We worry about helping foreigners. | |
| And look, it's not that we hate foreigners. | |
| We just love Americans more. | |
| And again, if we're going to worry about reducing tax burdens anywhere, it should be domestically before we worry about internationally. | |
| Also, and just lastly here, Carl, real quick, we should remember that during America's golden age, which Trump speaks about frequently and fondly, we didn't even have a federal income tax. | |
| All we had, essentially, were tariffs to fund the federal government. | |
| And that was our fastest sustained economic growth was during that period. | |
| So this idea that somehow if we start putting tariffs on things, the whole economy is just going to collapse. | |
| I'm sorry, but both the record of history and economic theory simply do not support that thinking at all. | |
| Correct me if I'm wrong, EJ. You talked about the golden age. | |
| There were a couple of periods of American history where tariffs worked beautifully. | |
| You had President William McKinley, although, albeit, I believe during his second term, he may have changed his mind on tariffs for a period of time. | |
| They worked well. | |
| And the same was true during the Roaring Twenties with Calvin Coolidge. | |
| Am I wrong? | |
| That's right. | |
| So we have plenty of examples, Carl, from history when tariffs were implemented well and also when they were implemented poorly. | |
| Probably the most infamous one would be the Smoot-Hawley Tariff Act, which was done under Herbert Hoover, a bipartisan Congress, and Hoover signed it into law. | |
| So this idea that somehow tariffs are always going to have one outcome or the other, that's just not what the record of history shows. | |
| And so that's why it's so important to go back to how we began this conversation. | |
| Talking about how America has such incredible leverage today and America would... | |
| Far and away be the least loser of anyone if we got into a full-fledged trade war. | |
| And again, that's a big reason why everyone knows Trump has all the leverage in these negotiations. | |
| He has figured out quite brilliantly how to weaponize the purchasing power of the American consumer and really to wield that like a weapon on the world stage. | |
| He is doing it incredibly successfully thus far. | |
| I would anticipate that to continue. | |
| Yeah, honestly, I've been so impressed by it. | |
| I mean, do you think this is Trump? | |
| Do you think this is Lutnick in his ear, Scott Besson in his ear? | |
| I mean, I've been, honestly, I've been so impressed with this. | |
| It's insane. | |
| I think a lot of it is just Trump being Trump. | |
| Now, that's not to say that guys like Scott Besson aren't brilliant and they don't have Trump's ear. | |
| They certainly do, right? | |
| Besson is incredibly smart. | |
| He's a master of sovereign debt markets. | |
| I'm so glad that he is at Treasury. | |
| I think he's going to do a wonderful job. | |
| I think he's already doing a great job with what he's done with the Consumer Finance Protection Bureau, shutting down that weaponized branch of government, essentially. | |
| Just phenomenal, right? | |
| Great guy doing great things for the president. | |
| And also, I think... | |
| Giving him good advice on tariffs. | |
| But I don't want to diminish the fact that Trump is already coming at the tariff conversation from an incredibly great starting point, right? | |
| He is already so far ahead. | |
| And any additional help that he gets from guys like Besson, that's just icing on the cake, in my opinion. | |
| All right. | |
| We'll have to leave it there. | |
| At Real EJ Antony on X. Thank you so much, EJ. Appreciate your time. |
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