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Aug. 6, 2025 - Ron Paul Liberty Report
32:45
Trump Pulls Trigger On India Mega Tariff Will It Backfire

President Trump has followed through with his threats to add more tariffs on India after that country refused to stop purchasing Russian oil and petroleum products. Will the effective 50 percent tariff on Indian goods bring the "world's largest democracy" to its knees?

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Wealth Consumption Crisis 00:14:42
Hello everybody and thank you for tuning into the Liberty Report.
With us today we have Daniel McAdams, our co-host.
Daniel, good to see you this morning.
Good to see you again, Dr. Paul.
How are you?
Very well.
Very well, thank you.
I want to start off with a little economic policy statement and we have some other things to talk about.
But first off, I wanted to read a title coming from the Wall Street Journal because it's something I've talked about a lot.
I think it's very important, but I don't think it's emphasized enough because a lot of people know prices are going up and there's special interest benefiting and the routine things.
But the headline caught my attention.
It says, earning more but in worse shape.
Hardship overwhelms many American families.
Well, I don't think it's news to a lot of American families because they are hurting.
But my point is that the pet peeve I have, why are they doing this?
Most Americans, in spite of our gripes, what the welfare state does, it teaches people to transfer wealth illegally and people suffer through the inflation and all this.
But they wanted to do this and they have this policy.
And so the people naturally, with the amount of education they've had in our universities and the propaganda, they say, well, the government's, it's like a hurricane came.
You know, this economic hurricane.
Well, the government has to bail us out.
And so that's the whole thing.
But here are a couple of things I mentioned briefly.
Nearly half of the kids in the U.S. live in households below the middle class as inflation at the end of COVID relief hit working parents, a $290 raise that cuts government benefits.
Well, you know, I think the problem is very significant because there's a wealth maldistribution when you destroy a currency.
And the liberals and everybody used the term, the wealthy gets wealthier, the rich get rich, the poor get poorer, but they never really explain it.
They might say, well, it's whose friends are in the White House, and they get the benefits and they get the contracts and all.
But it's a manifestation of the destruction of a currency because when they destroy a currency by printing too much of it, it's who gets to use it first, especially when it has a higher value.
As a currency, a fiat currency spreads around an economy, it goes down in value.
And then that ends up in the hands of the middle class of the poor, and their prices go up, and they say, the government has to help me.
I need another program.
And yet the programs was a participant in the destruction because whether, you know, even though the welfare system is designed to help the wealthy, there's no doubt, you know, like through pharmaceutical and military industrial complex, these groups allow it to happen.
But even the distribution of the money, they throw crumbs to the poor, and they say, well, the government's there to help us and make us safe and secure.
And they never sit down and start talking about what can they do about it.
There's not that much mention of, you know, cutting militarism and, you know, not spending so much overseas.
A little bit more of it.
And I think the administration has helped a bit on that.
But I think what we're facing here is a bankruptcy.
The money's going bad.
It's been going bad.
And the opening salvo on that was in 1971.
And it's gone down steadily.
since the ultimate best measurement of the value of a dollar over centuries has been its exchange rate with gold.
And of course, we know that gold was very low in dollar price, $35 at $71 over $3,000, probably $4,000 maybe before the program ends.
So that problem exists.
And you do know that some people say, well, it's a deficit.
They'll agree there's with a deficit.
Why don't we just work this out and pay a little bit down?
Well, that's what Laska Elon did.
He tried to, but nobody would accept it.
It caused a big split between the two of them.
So I think this idea, and I think maybe you would agree with this, the impression we get from our friends there, even when they were friends, that they would all of a sudden start voting the tough votes.
And they're not going to do it.
But I think that's one thing that could be done, and the deficit could be gradually reduced.
But they haven't accepted the principle, the argument we've made, and that is cut the easy stuff.
Cut the war money.
All the wars we lose at killing people for needless causes.
And they're not going to do that.
So, you know, ultimately, when the bankruptcy leads to the ultimate crash, when things just disinterate and there's currency destruction, then there's a lot of people going to be on their own.
And one thing, individuals, the individuals who have a trade, an ability to provide a service are going to do better than those who have lived on special interests, you know, both rich and poor.
So I think that is coming, not next week or next month, but that's what it's leading to.
But what we're seeing now is the initiation of that.
And when you get these statistics, I mean, a lot of these people, you know, might be skipping lunch and not going to bed hungry and that, not in America, because it's been so rich and so prosperous.
And we have had so many benefits from the oppression left with the Constitution, but that has been lost now.
So we have a major problem, and I still argue the case.
It's not complicated, but there's a lot of confusion on what we do.
So this maldistribution, I think, is one of the biggest influence and is the subject that, if it's not dealt with, will lead to violence.
And I imagine we're seeing, most people would agree there's more violence now in our society than it has been a long time.
Absolutely.
And you mentioned money going bad.
Well, that is a great segue into our first thing that we're going to cover because that's exactly what we're talking about.
The party was fun, but now comes the hangover.
Put on that first clip.
This is from Politica.
Now we're going back to that one big, beautiful bill that everyone said we naysayers are just not the life of the party anymore.
Well, here's some more information coming out.
The CBO, which is the Congressional Budget Office, the Republican mega bill to cost $4.1 trillion due to higher borrowing costs.
Now, the next one explains what they mean on this.
If you can click over to that one.
Interest rates will be higher over the next decade because of the GOP's mega bill and drive up borrowing costs even for the federal government.
Congress's nonpartisan scorekeeper predicts in a new report released Monday in an analysis of the massive domestic policy package President Donald Trump signed into law on July 4th.
The CBO estimated the measure will, quote, and I and I highlighted this part, will increase the federal deficit by $4.1 trillion over a decade.
Because the bill's red ink is not offset by more spending cuts or new revenue, CBO found the legislation will drive up interest rates.
Now, I'm sure they're going to blame the CBO for being partisan or what have you, but the fact of the matter is a lot of people, including Thomas Massey, were warning about this at the time.
You know, they're talking about the right issue on interest rates.
And the big argument, of course, is Trump, with his experience in business, he knows the benefits.
And there are benefits to the special interest, the people who are the big investors and want to get hold of that money quickly.
So he wants to lower interest rates, but Powell wants to assure the people that he's a more balanced person and he's not going to cause chaos.
And he's more adult about the whole thing.
But the whole thing is, none of that matters first because they can't set an interest rate.
But when we had something similar, and in the 70s, we're worse than what we have right now.
But I think today's efforts and trends are going to get worse than they were in the 70s.
But we had, you know, inflation rates got high.
But what happened to interest rates?
You know, they wanted to, you know, stimulate with low interest rates, but the markets drove the interest rates up to 21%.
So they should be arguing, how do we prevent us getting any further along?
Could it be possible that we're developing the same conditions that Volcker got credit for by really bringing the economy down, which is a heck of a way to do it?
You know, in a free market, you never purposely manipulate the CPI.
Prices might go up for other reasons.
There may be a hurricane or something.
You don't manipulate that.
And so it's always somebody going in there and manipulating and think they know.
But that's what my concern is: that we're moving rather quickly into a period of time in the late 70s.
And then you have, I don't think you'll have a Volcker.
I think that's when the violence is going to get worse.
Because, you know, even Volcker wasn't.
I had heard that Volcker actually was probably one of the last holders and somewhat sympathetic to gold.
But he was able to do it.
And then, of course, Reagan came in.
But I think that was a little bit of luck in there.
We were still, the country was still wealthier.
And right now, our wealth is being consumed.
And yet we never change our foreign policy.
And we never change our welfare policy.
And the spending continues.
And that's why you bring this up the budget.
It's a lot worse than they admitted.
And I find the argument over the interest rates is fascinating because if you wanted me to make a guess, I think Trump, well, I've already said Trump, both Trump and Powell, they don't know.
But I would say they're way off the mark because I think you should have the market.
And I think the market's saying, you guys better slow up because the bankruptcy is going to disrupt.
And this article, I think, gives you a hint, you know, where the disruption is going to be.
And I agenda just earlier, you know, how much suffering is going on now, but really ignored because they're not looking at the real facts.
Yeah, exactly.
And here's another part of it.
You always talk about unintended consequences of policies.
Now, remember, they were pushing this bill, and any naysayer was railroaded by the whole thing.
If you go to the next clip, these are the unintended consequences of this big, quote-unquote, big, beautiful bill.
Now that increase, they're talking about the increase in interest rates, could affect investors and regular people getting loans for a range of assets from cars to homes.
So that'll make our lives more miserable.
But the article continues, it will also, and I highlight this, hike costs for the federal government in a real way, according to the budget office, increasing interest payments on the nearly $37 trillion national debt by $718 billion over a decade.
Dr. Paul, that seems to me a big chunk of money that they're literally lighting on fire and burning up.
You know, the dollar has been fiat for a long time, and it's managed to get by by this manipulation because we've had a store of wealth.
But the store of wealth is dwindling.
But the confidence in the dollar is dwindling.
And yet this expenditure, they can't stop it because they have to pretend that we can keep it together.
So a lot of people, a lot of countries have bought Treasury bills.
But if we, you know, before we defaulted and declared bankruptcy by not promising what we promised them, it would be a gold exchange for the fiat money.
But here, they're at a point now where they're not going to be able to reimburse, and there will be a loss of confidence.
And that's what I think the frustrations that are going on are the frustrations that there's no easy answer to the difficulty they have in deciding, we agree with you, Ron.
That's it.
We're spending too much.
We don't need to do that.
We need to bring these interest rates down.
Let the market do that.
They do that, but they really, we don't hear much real debate on that.
You know, they barely mention it.
So I think, unfortunately, I think the spending is going to continue.
It's going to get worse.
People have to really buckle down and think about how you survive in bad times.
And there was a lot of survival efforts in the depression times when things got bad.
And nobody can predict exactly what it will be like.
But I do know that government policy and government monetary policy and foreign policy, it all has an effect on it.
But ultimately, it's the destruction of money and the value of the dollar that will bring us down.
Yeah, absolutely.
Well, you know, they will deliver bread and circuses, though.
And put that last clip on, because this reminds me, you often correctly bring up COVID often on this program.
And if you remember, at the time of COVID, when they had destroyed the economy by forcing people to stay home and not do anything, what did they do?
They gave us STEMI checks.
They gave us checks of thousands of dollars.
Smart people like you and Thomas Massey said, you guys are going to have to pay back double or triple the amount you're getting in that $1,000 check.
Adjust Count Up 00:02:45
And everyone said, I don't care.
This is fun.
I got some free money.
Well, sorry, put that one back up again.
Now, they're at it again, Dr. Paul.
Congressional Republicans largely dismissed the CBO's deficit and interest rate warnings in the days before clearing the bill for Trump's signature.
And I highlight this, arguing that the legislation will juice the economy far more than forecasters have ultimately predicted.
Juicing the economy.
You know, it's sort of the argument and the dream, because there's a half a truth there.
We're going to lower the interest rates and we'll be the supply siders that stimulates business.
And the production is going to go up and help hold prices.
They will.
And that's what happens in a free market when it's natural.
But the whole thing is, they predict that, then they forget about did it really stimulate.
It might do a little bit here or over here, but it really isn't the answer.
Just spending more money and printing the money.
And for years, decades, they've gotten away with this.
They've had slumps and they've gotten out of it.
But I think the real dilemma is they're in a position right now where tinkering with foreign, well, foreign policy, especially monetary policy, that they're not going to kind of see any ability to handle what they're reporting now, how much higher this debt is.
And before you know it, they say, oh, we have to adjust it up.
They didn't count this.
But I don't think they're anywhere close to it because, you know, there's always these emergencies that have emergency fund, and nobody, you know, almost nobody can vote against it because, no, no, we had a hurricane.
We have to help with people and therefore print all the money.
Yeah, that's not going to help the people ultimately.
It's a drug addiction.
People feel good when they take the drug.
But eventually, they all have to either get off the system or the patient dies.
They have to get off the drugs.
And right now, it doesn't look like there's any serious effort.
Thomas can't do it all by himself.
But in spite of all this negative stuff, I still think that the number of people waking up are growing.
I think it was great that people finally rebelled against COVID, all that maneuvering.
And there's people like that.
But the average person living in an inner city, and the other thing that I read is, usually it was the inner city where the poor were counted a notice, but it's in the small little towns too, because their money is being ruined as well.
Additional Tariffs on India 00:11:16
But it's not easy to plan for a crisis like this because as far as I'm concerned, it's going to be ultimately corrected when we have a different understanding on the issue of liberty and where we were once when we were much more interested in following the Constitution.
Well, speaking of people who need to get off drugs, and I'm half joking, one of the things that happened this morning, breaking news this morning that I sent over to you and we decided we want to talk about a little bit, is that Trump followed through with his threat/slash promise to slap additional tariffs on India.
Not an inconsequential country in terms of population, of course, but also GDP.
Put that first one up.
So he got up this morning and he felt like he's done with it.
He's tired of it.
He said Trump slaps India with an additional 25% in tariffs over Russian energy trade.
Now, these are the so-called secondary sanctions, Dr. Paul, where the United States government punishes other countries for doing business with other countries that they don't like.
India's been purchasing Russian oil.
They refused to stop purchasing Russian oil as Trump demanded.
And so he hit them with 25% tariffs in additional to the existing with a total effective tariff on Indian products coming into the United States of 50%, which is huge.
Now go to the next one on this.
The accelerated tariffs, which stack on top of the 25% country-specific tariffs set to be implemented overnight, will go into effect within 21 days, according to the executive order.
Now, some people will look at that 21 days, Dr. Paul, and say, well, Trump may chicken out, as they say.
But here's what Trump said.
This is his rationale for additional tariffs.
And I use those words, unfortunately.
I introduce them because they're the same, tariffs and sanctions.
But here's what Trump said.
They're fueling the war machine.
And if they're going to do that, then I'm not going to be happy.
He said.
We don't want an unhappy president.
That was his rationale.
I'm mad because they won't do what I told them.
So what am I going to do?
Tariffs.
You know, all this mischief that we've been talking about does affect the dollar.
And what does this do when you start messing around with tariffs on India?
And you can't talk about India without talking about China.
And then you say, well, they're messing around with the currency and it's out of equilibrium.
Then the big guys do recognize we're getting away with a lot.
And we have, but not as much as we used to because ever since Bretton Woods, we were so powerful, it looked like, and we acted like we could print the money forever.
And of course, it was stopped in 1971 and readjusted then.
But right now, with these, I think these tariffs are going to really backfire.
At the beginning, they don't seem so bad, but the results are going to get much worse.
But what will it do if it affects the monetary market?
Maybe this could be a tremendous incentive for BRICS to get together and compete with the dollar, because that's ultimately what happens to it.
And there are people doing that already.
It's not massive and it's not in the front pages of the paper.
But I think that will happen the way we're marching on because of just bad economic policy.
And I think some people that participate in it know darn well what they're doing and they're going to benefit and they'll finance their projects.
But most people, most average people, aren't going to realize that tariffs someplace else.
They'll look at the superficial thing.
Oh, we could keep those cars out of this country and everybody will be happy.
And lo and behold, right now people say the car industry is really, you know, looking at some statistics that aren't overly encouraging.
Yeah, I'm glad you brought up BRICS because it's important.
The whole rise of BRICS was a result of the U.S. using Shankson's sanctions as a bludgeoning tool to hit every other country who threatened U.S. dollar hegemony.
Well, what is the result of it?
You actually create a block of countries that are collectively threatening U.S. dollar hegemony.
And so if the idea is to pry India away from Russia and China, by the way, well, what are these sanctions going to do?
They're going to do the opposite.
They're going to force China and India both will be the victims of these new sanctions.
Actually, the American consumer will.
But nevertheless, they will suffer for it as well.
It's going to drive them together.
They're going to say, okay, we've been fighting for a long time.
We disagree with each other.
We had actually a hot war almost a couple of months ago.
Let's find a way to get together because our common enemy is trying to destroy the economy.
It's counterproductive.
It'll have the opposite effect.
You know, I see it as a contest between the market and people who claim they're smarter than the market.
So the market has certain rules that you can't break, even though they're not written on the wall, and they've never heard about how the market really works.
And this to me is an opening for people who can benefit on the short run and get what they want.
And they have to convince the other people they're smarter than they do.
So this is the big question now.
The argument is the system, along with the chairman of the Federal Reserve Board, smarter than a businessman now, President of the United States.
And time will tell exactly how this works out.
But I think right now it's not going to help the dollar, and that's not going to help these poor people we started off with that suffer the consequences down the line.
And I still, you know, I think that the thing that has to be done is a better education on economic policy.
And that, of course, is what we try to do is introduce these ideas to try to prevent it.
You know, on foreign policy, you've spent so much time on foreign policy.
And it's not because you enjoy watching wars.
It's because you can see the tremendous danger of it.
And we do know that young people don't start these wars.
You know, that's one thing that people need to awaken to.
The thing that we need to stop for a minute and think about as a country, what are the purposes of these tariffs?
They were sold to the United States by President Trump and his people as a way to reindustrialize society.
We're going to start making things in America again.
We're going to become richer because we're going to make other countries pay for doing business with us.
All of these things were an economic argument for tariffs.
But now we're at the point where Trump says, I'm putting on tariffs because you're not making me happy.
You know, so the entire rationale for tariffs was economic, but actually it's not because they're not tariffs, they're sanctions.
I'm not happy with your behavior, so I'm going to put sanctions.
Rather than direct sanctions, they're putting them indirectly on India, but directly on the American people.
Now, I did want to point out one historic point, and this is our friends over at Moon of Alabama.
And I'm going to try to be as quick as I can.
But they explain why India was buying oil from Russia in the first place.
If you go to that next clip, now it goes back to when the war started in 2022, Dr. Paul, the Ukraine war, the European Union said, we're not going to buy any more Russian oil and gas.
So they stopped buying it.
Well, what they did is they went over to the Gulf countries and they said, we're going to buy yours instead.
Well, India and China were already buying Gulf oil and they were displaced by this.
And so what do they do?
They need oil.
They're not going to shut down their economy because the U.S. wants a proxy war with Russia.
So they started buying Russian oil.
Joe Biden didn't have a problem at all with that because he didn't want global gas prices to rise.
You remember that, Dr. Paul, when people would put those stickers on the gas pumps?
I did that with Joe Biden, the high prices.
So global supplies continued on an unchanged level, and the change in the routes of oil around the globe had only a minor effect on prices.
But one side effect was that some European refineries changed the way they were processing.
They had been specialized in processing heavy ural oil.
They eventually had to go idle.
So they lost their industrial base there.
Their business was picked up by the Indians, who are no dummies.
And this is a paraphrasing of what they said.
And they started processing the Russian oil and exporting it at a profit.
Now go to the next one.
This is why it's more complicated than people explain it.
But now the U.S. and its European vassals, writes Moon of Alabama, are trying to impose sanctions and/or tariffs on China and India for that continued buying of Russian oil.
And I highlight this.
This would disturb the new market balance and eventually lead to higher oil prices for everyone.
And that's an important point that Trump doesn't seem to understand what this will do.
And now the next one, I'm not going to read it all, but remember what China did when Trump was trying to put those big tariffs.
They said, okay, you wanted some rare earths.
I'm sorry.
We're not going to sell them to you.
And Trump backed down wisely.
Well, if you go to the next one, the Indians also have some comparative advantages.
There are Indian products like pharmaceuticals for which it has near monopolies and which the U.S. needs.
If India is smart, writes Moon of Alabama, it will play the same game as China did with rare earth.
Withhold what the U.S. needs and wait for Trump to capitulate.
So this seems like bread and circuses, Dr. Paul.
It seems like a show.
Sure, it does.
And I like what you mentioned there about tariffs are one thing and sanctions are essentially the same thing.
It's just trying to manipulate and get an edge over the competition.
But this other thing has really expanded because it's the infiltration of taking money from poor people through inflation and giving it to very, very wealthy universities that spout free markets?
No.
They spout the opposite of into the tune of billions of dollars.
But then we get Musk and Trump come along and they rightfully point something out like this, but they also use it and say, oh, the colleges that we own, you know, by giving them all this money, what they're saying, don't ever say anything that challenges our foreign policy.
You can't defend and explain Palestinians are being killed.
Oh, no, that's bigotry, and it's nowhere close to a neutral policy where we don't get involved in that.
Investment in Liberty 00:04:00
But there are always so many places now they get involved with, these are First Amendment rights, because they own it.
In a way, incestuous, like they got control of the judicial system, and I say still have a lot of control in the judicial system that they move things in a certain direction.
And now, this shows how powerful they are with the use of money and how easy it was over the many decades for the universities to roll over as long as you send money.
Of course, we know a few colleges that survived that and just refused to accept it, but they were a little more expensive.
We'll give you a free education.
We're part of the government.
Yeah.
Well, I'm going to close out, Dr. Paul, by putting up that last, the second to last clip, if you can.
We are in the home stretch, Dr. Paul, before our ninth yearly Ron Paul Institute DC area conference, Blueprint for Peace.
It's got a great lineup.
I've updated the lineup on our page.
There is a link in the bottom to a description and ticket page where you can see the updated lineup of speakers.
It's going to be a great event, absolutely.
And go to the next clip because this is one of the kind of neat events that we talked about the other day.
We got Judge Napolitano.
We've got Doug McGregor.
We've got Jeffrey Sachs.
We've got Anya Parampil, and we've got Max Blumenthal on stage for a live version of Judging Freedom, the judge's very popular news and analysis show.
It's going to be a lot of fun to watch them do it live.
The judge is always informative and entertaining.
You're going to get to see this live on stage for the price of your ticket, along with a lot of other great, great speakers.
Natalie Morris of the Redacted, she's terrific.
She just sent me her speech title.
It's going to be great.
I don't have it in front of me, but go to our page and you'll see the title of her speech.
Great event.
Get those tickets.
The last, what, 10 days?
I don't know, before it's going to happen.
Get those tickets and come join us in D.C. Over to you, Dr. Paul.
Well, I think what you've just described to me shows you and shows all of us the effort that you, Daniel, have put into to put a good program together.
this is wonderful.
So I think that we should see this as, let me finish my sound.
This is an investment conference.
This is to be an investment.
And a lot of people ask me, what do I do to protect my investments?
Have a few ideas, but no, this is an investment in the cause of liberty, an investment in spreading the message of sound economic policy, sound money.
And I think ultimately, I a lot of times want to conclude a statement that I'm making that this is more important than whether or not you have gold coins in your house.
So, no, it's the investment in liberty that really counts.
And I try to visualize and think of what it must have been like with the founders because I think they knew, expressed themselves, and some did.
They lost their lives over what they were doing, expressing the concept of liberty.
So, that to me is the goal, and that effort has been around a long time.
They even thought about this quite a few thousand years ago in increments.
So, it's still here, and there's a lot more information.
Besides, there's a lot better way to spread this information.
The internet, I criticize it all the time because I can't make it do what I want it to do, but I tell you what, we're able to reach a lot of people through the internet and spread this message of liberty.
Please join us in that effort.
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