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Oct. 17, 2025 - Ron Paul Liberty Report
26:25
Trump's “Trade War” Chaos with China — Who Benefits?

One day we're in a "trade war with China," and the next day we're not. One day, there are threats of "100% tariffs," on Chinese goods and the next day there aren't. World leaders need to do nothing but sit back and watch. Meanwhile, the American people are taken on an emotional roller-coaster of threats that (ironically) would harm the American people more than anyone else. What's going on here?

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Time Text
Birch Gold Partnership 00:02:22
Thank you for tuning in to the Liberty Report.
With us today, we have Chris Rossini.
Chris Rossini remotely coming in as our co-host today.
Chris, welcome to the program.
Dr. Paul, it's great to be with you, as always.
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Trade War Chaos 00:15:01
So back to you, Dr. Paul, to start with our main topic today.
Very good, Chris.
And I want to welcome once again all our viewers for coming in today.
And I would like to start off by just mentioning the fact that there's a trade war going on, but some of the participants are in denial.
Trump says that we're in a trade war.
One day, some days we're not in a trade war.
But there's a lot of activities and a lot of misinformation or confusing information is what we have.
What is a trade war?
And what about tariffs?
And who's initiating all these wars?
But it's a big argument going on, but it has high stakes at it because the accusations, you know, in foreign policy, you have a lot of accusations, but in economics, we have them too.
Who started this trade war?
Well, Trump thinks it's all China's fault.
Sometimes we think that the responsibility we have in this country is providing for a free market.
And we say that, well, maybe our side started all this, all these controls and tariffs being placed on there.
But Trump is determined that we're in a trade war and he's going to put on up percentages of more tariffs.
And guess what?
The market crashes, goes down, trillions of dollars.
It's just a lot of nonsense.
So China responds.
And they say something back.
Well, you do that.
You know, what we're going to do to the computer chips and what we're going to do with other things that we can retaliate against that.
And then the whole thing shifts.
So I see this that the whole thing is chaos.
It serves the interests of some people who like chaos.
They benefit from chaos.
And it's a design purpose by fascists that the more chaos, economic and international, the better it is for them to present their cause for socialism.
So this is something that has been going on for quite a while, especially in these last six months.
And there's been a dramatic change in attitude by the establishment economists because, you know, before Trump was elected, the economists didn't come out and say, well, I'm for tariffs, I'm for tariffs.
But now it's different.
The attitude is that Trump is in charge and therefore tariffs are the way to go.
And now they're sorting it out.
But I think we've ended up with chaos in the marketplace and just a bunch of accusations going on again.
And it's going to happen because, you know, it's a matter of definitions.
You know, who's on the side of free market?
The first thing we know is that Trump initiates the initiate the tariffs and then China retaliates.
And that really infuriates Trump.
Why are you starting a trade war?
So in a way, it gets really pretty silly.
But Trump's been notorious for on again, off again.
He imposes something and demands something.
And then he comes back.
And I often wonder whether he's confused or whether that's part of his, you know, the art of the deal.
And I didn't read his book, so I don't know exactly what's going on.
But it's up and down and keep people guessing.
But it isn't exactly the way a free market works.
And it is frustrating probably for many people that they can't predict.
And unfortunately, the one prediction that most people predict that have looked at this is that it does cause chaos.
It's not good for the market.
And there will be people who will suffer from this type of an economy that is, in a way, a trade war going on with no sound predictions and makes it more difficult for governments to operate and more difficult, especially for the businessman and the investor, the entrepreneur, and the customers to make their decisions on all their purchases.
So I see this as chaotic.
I like the free market.
And Chris, I think that's one of the things that we've always emphasized here.
Yeah, that's right, Dr. Paul.
And President Trump, I think, is losing, you know, people can't trust him or believe anything he says, whether you're a world leader or even the American people, because it changes on a daily basis.
You know, it was just a few days ago, President Trump said we are in a trade war with China.
And then today, Hassett from his administration says we're not in a trade war with China.
And then President Trump threatened 100% tariffs on China.
And today he's back, you know, he's backpedaling.
It's not sustainable.
We need a fair deal.
You know, this deal stuff, this is called art of the deal.
There's no art to this because these threats are so big.
These threats are against us.
You know, the American people, we would suffer the most if he carried all this out, not other people.
So this trade war, we're already paying all the tariffs, not all of them, 86% of the tariffs.
So we are the ones that are suffering.
They weren't slapped on foreigners, like it was said.
And, you know, 100% tariffs would harm the American people.
China is selling much less to us, but they're selling much more to the rest of the world.
They are racking up record trade surpluses.
Record, meaning they've never sold this much.
So this idea that Trump is going to verbally bully the world and harm us at the same time, it's just this is not good.
You know, this is not good for anybody.
In fact, our market goes crazy every time he says something, and then he's got to backtrack it because it's absurd.
So I don't know, Dr. Paul, this is some weird form of art of the deal, but I think he needs to change course.
You know, one of the things that our side complains about is what China is doing with their policy because it's hurting our economy.
But what China has done is they've worked real hard in controlling an element that they have a lot of natural control of, and that's the, you know, special minerals.
And so they have control of it, and they work real hard to gain the market by lowering prices.
So we've benefited from lower prices, but now our government doesn't like that, but because they're underselling us.
And what's this?
The communists are underselling the freedom fighters.
And so what do they do?
We retaliate by having an industrial policy.
We're setting price controls.
They're going too high.
We don't want them to go down.
And we don't want China to lower the prices on these minerals that are so precious and valuable.
So it's upside down.
And Chris was alluding to this.
This is sort of crazy.
But they've been doing this for a while.
But it's this whole idea of blame.
And the U.S. had to use this industrial policy to compete with non-market economies like China.
They claim they're non-market, but it turns out that China, from our viewpoint in this narrow sense, they are much more free market oriented and trying to solve our problems.
And just by calling what we do is price fixing and telling people what to do, or we threaten them with more sanctions.
They think that is the market.
And the fact that the Chinese, they're doing this terrible thing by working hard and becoming more efficient and selling products below our prices.
But that's basically what's been going on because, you know, because of costs in China being lower, instead of saying, well, if somebody can produce something cheaper or better, we all have to recognize it.
We have to change our ways.
We can't change their ways.
And this is what is happening.
The infractions say that we have the responsibility to deal with China and everybody else.
And we have just used this tool of sanctions and tariffs and everything else to do our bidding.
In the old days, if somebody was underselling us and beating us in the market, we had to do better.
There was a time several decades ago when the automobiles were obviously much better from overseas.
Well, that has been changed to a deal.
We build all the cars with all the parts coming from all over the world.
And we want to see the market work like that, getting the best deal.
But for some reason, the industrial policy against China is not the way to good relationships with anybody.
That's right, Dr. Paul.
You mentioned the word blame, and that's our problem here.
The problem is the U.S. government and what it has done to our country, but they're not going to take the blame.
So it's got to go outward somewhere else.
And let's blame the world for our problems.
And the claims are that the world is going to build us up with $18 trillion in investments.
This reminds me of Mexico building the wall.
Mexico didn't build the wall.
And where this $18 trillion is supposed to come from to build us up by bullying them, you know, remember when this administration started?
He's, you know, Liberation Day, and 100-plus nations are crawling to President Trump to make deals.
You know, nothing happened there.
And the world is moving on, you know, and it's kind of embarrassing for us because President Trump is trying to bully Russia away from China, trying to separate them, try to separate India from Russia.
You know, he's trying to pull them apart, and it's not working.
In fact, President Trump said the other day that his threats are working, that everyone is dropping out of bricks, but no one has dropped out of bricks.
This is not good, you know, the way that this is going, because we have to be able to be taken seriously in the world.
And the way to be taken seriously is we have to fix what's wrong here.
And what's wrong is the size and scope and spending and debt of the U.S. government and blaming the world and thinking that they're going to build us up with their money.
That's just not going to happen.
I sure agree with that.
I'll tell you, the one thing that's coming up, though, that's already out on the table, and they have already participated in this way on our side, and that is if the others don't do what we tell them to do, we put on sanctions, put on tariffs, and that sort of thing.
But our government and our country has now, with the administration, taking up stakes in the companies.
We buy the stock in the companies.
And that to me is just seems so dangerous and moving in the wrong direction that the stuff should be owned by the people and the private owner.
But here we are moving in.
And over this issue, this is what we're doing.
We're threatening China right now.
The administration might take over equity stakes in more companies in the wake of China's new restrictions on rare earth exports.
Now, that is a movement in absolutely the wrong directions, totally away from the people on it, being responsible, supply and demand, profits and losses, all the things that guide the free market.
And here they are saying, well, we'll buy up equity.
We'll be part of that company.
We'll have control of this.
And we will be able to compete then with China.
I think, you know, overall, there's the immediate economic effects of all this nonsense going on.
But I think long term, this whole principle of us buying up these stocks and becoming a participant, and they're not nickel and dimes.
I mean, it's huge.
And in many cases, well, even if it's not stated, it means we're going to have more control of those companies.
So we're moving in the wrong direction for what a free market looks like.
We shouldn't be in the business of price fixing.
That's what this is all about.
Price fixing, but It's interesting because most of the time, when there's price fixing, even by our own government, is to quit and have people quit raising prices due to the inflated money supply and the prices going up.
Now, this is different.
We want to punish the people who are selling us, selling stuff cheaper instead of saying, Oh, well, if we can get chips cheaper than this, why should we say we can't import these?
Or once we think one of the silliest things so far was you know, the automobile industry, it isn't like I want an American car, I want everything in this country.
It would be crazy, it would be less efficient, and probably quality would go down.
But they will not, they are not going to do this.
They want to have the control, so they put prices on.
Don't lower the prices on us.
We don't want the American.
And I've argued the case before on tariffs.
Why, if poor people in this country can buy tennis shoes for $25 and good ones too, why should we prohibit them from doing that to save $75 and let them buy it and let the competitors do something about it?
You know, maybe they have ways of competing, whatnot.
But it should be, it's a problem, so to speak.
But we should let the market decide this.
But here, I see everything that we're doing is we're not letting the market solve the problems.
And we won't even admit that it's our interference in our own markets.
Well, you know, inflated dollar to dollar, the dollar is going down, and there's a lot of chaos and interest rate problem.
Well, that's monetary policy.
Monetary Policy and Market Freedom 00:03:01
But instead of yelling and screaming at everybody else, we have a responsibility too.
And especially on the monetary issue, because we've been managing the currency as dictators ever since 1945.
And right now, some of the predictions made very early on, even at the beginning of Brown Woods, that it would fail.
And I think we're in the middle of that failure.
And people need to up to the reality that we have a responsibility and we may be at fault now and then.
But for some reason, if you disagree with our government that we are unpatriotic, and I've always sort of kidded, but made the point that the Second Amendment was not put in there for us to be able to discuss the weather.
It was put in there for us to be able to criticize our own government and mind our own business elsewhere if they aren't bothering us.
Very good, Dr. Paul.
I'll finish up with my closing thoughts.
Speaking of the price of gold, as we talked about at the beginning, this rising over 4,300 price of gold is a report card on what people think of the U.S. government and its policies.
And the report card is an F. You know, people run to gold when they know that the government is messing up and the government is messing up.
There is no doubt about it.
It's like a train rolling off the tracks.
And these other nations that President Trump tries to bully, there's no way for us to know what they think.
But if I was there and I wasn't an American, I would think let these Americans knock themselves out with their own policies.
We just have to protect ourselves because they'll probably try to lash out at us and attack.
And, you know, because that's always possible.
And that's probably what they're thinking.
They're just watching President Trump with all these threats going now into Venezuela, continuing Ukraine, Gaza.
We have a thousand bases all the world.
These nations are not doing that.
Russia, China, they have, you know, China has one base in Africa.
So their military is probably laser focused on defending themselves.
Our military is laser focused on who are we invading today.
You know, so they're probably just waiting us out.
Let them with their own policies knock themselves out.
What a shame.
We're Americans.
We have to deal with this.
And our government is doing it.
So we need to start doing the right things.
I mean, it's not happening now, but we have to say it.
We have to shrink the power of the state.
It's spending right now.
As of next year, it's going to hit 40 trillion in debt.
We're going in the wrong direction.
We're at 37, 38.
They're expanding everything, spending debt, monetary inflation.
Our prices are going to rise even further because they want to print more money.
That we don't need to.
Unit of Account Debate 00:05:59
I can tell you that.
I'm sure everybody agrees with that, but that's the policy of the government.
The gold price is reflecting it.
So as of today, things are not going well, Dr. Paul.
Very, very good, Chris.
You know, I guess for years, I've talked about an incident back in 1971 where we totally went off the gold standard and admission that we were bankrupt.
We couldn't honor our commitment.
And that, to me, is very important.
I've talked about it.
I knew about the predictions that it wouldn't work even early on in 1945.
And yet today, I want to mention, inclusing, some of the good things that have occurred with the breakdown of the Bretton Woods.
And that is that the first thing is that we started thinking about money issue because the Gold Commission, something that I was very much involved in in 79 and 81, had a commission to study the role of gold in domestic and international affairs.
I thought that was a great idea.
We did.
And the cards were decked against us.
We had 17 people and 15 were for the current status quo of inflation.
There were two of us that talked about the real need for gold.
And the proposal today in Zero Heads, and I think it was written by Peter Schiff, is what we should do is always talk about assets in gold, not in dollar terms.
How many ounces of gold will this cost?
And, you know, one of the good things that came out of the Gold Commission was the issuing and the minting a legal function, and that is the minting of gold coins.
And I always thought, you know, that is really neat.
We had an email gold.
And that happened, you know, a little bit later on, a couple years later.
We were able to, and we were competing with the Kruger ran.
So the commission did, you know, throw a bone to the gold people.
It allowed to mint the gold.
And the government was involved.
And it was very significant because it drew the attention to the unit of account.
Because we argued at the time that are we going to, what are we going to call the coin, $50, you know, of a $50 coin piece?
And that was not easily settled.
They wanted to use the word dollar, but the one thing that I argued for was we should be continuing because others were using the ounce of gold as the unit of account.
And that's one of the reasons why we're in such trouble is there's no unit of account throughout the world that is in government.
But it's just the transition now is over.
And central banks are buying gold and they're starting to think in terms of gold.
And that is so important.
It's the unit of account.
You can use the word dollar if you want and have to, but you have to have the dollar defined in something.
And the founders understood this.
I mean, if you could, if you made if you made it an ounce of silver, an ounce of gold or whatever, that would be, you know, at least you could have a definition of the unit of account.
And shortly thereafter, they legalized gold contracts, re-legalized gold.
And that's a big step from where we were in 1945 because we had so much wealth and so much gold.
Nobody was worried about it except a few people said at the rate you're going, you're going to run into trouble.
You're going to have too much paper money out there and we don't have enough gold.
And right now, we are not even analyzed.
We can't even get a true audit of gold.
And that's why the people are very leery about the system now.
And it's also the reason gold went from $35 an ounce to over $4,000 an ounce.
That's a lot of paper out there pretending that it's real money.
So there are those good things.
Gold being re-legalized, the unit of account.
People know it's an ounce of gold is a good unit of account or an ounce of silver.
And people are waking up to this.
There's many more serious discussions.
We had that discussion in 1981 in the Gold Commission and got a little attention, but it sort of died down.
But it's coming back now, the discussion that we should have had before.
But the market has moved along.
I've always said that you have to have the people with a prevailing attitude and opinion for things to change.
You don't have to have more politicians and more lobbyists in Washington to change things because they only change it for their benefit.
So I think we're moving along in the right direction.
And that is why gold now is seen in the news all the time.
And it should be emphasized because the more people who know about it and protect themselves with gold, the better off the country will be because there will be a transition and people will have to adapt and the more people who understand it.
So right now, there's a lot more people who understand the Fed and gold now than they did in the early 1970s.
I consider that progress.
And I want to continue that by us continuing in the Liberty Report to talk about sound money.
And of course, the most important issue is to support and promote the cause of liberty.
I want to thank everybody for tuning in today to the Liberty Report.
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