"The question is does free trade with China advance free markets or does it distort and wreck our free market? We have treated free trade as the natural extension of free market. If you are attempt to ..."

"trade between us and Europe is positive sum without trade you know being balanced trade is positive sum we're really excited to to to have you on because we've been talking about some some topics over..."

"Sure. Yeah, I'll I'll try to keep it short. Let me know if you want me to say more about anything. Uh but I founded American Compass back in 2020 uh with the mission to restore an economic consensus t..."

"actually going to take care a lot of the of the things that matter most to people. And and that pairing of family community, and industry maybe seems a little bit odd. Those aren't three things that a..."

"Um let me say a little bit more about the kind of the the broader question first and and then if we want to to dive into the manufacturing piece certainly we can. Um you know I I think the to to your ..."

"at all. You can have the situation we have in the American economy today represented by a a you know trillion plus dollar trade deficit in which you are exchanging goods for assets. And so if you imag..."

"You know, we do a lot of work also on industrial policy, on financial markets and investment flows, on labor policy uh on competition policy, but all of it ultimately follows the same template of aski..."

"they might be doing some sort of uh pro-fertility policy, but historically China has been the poster child for extremely unwise anti-fertility policy. So, uh, I I wouldn't characterize anything of wha..."

"think a you know a good proxy is how long did it take Japanese automakers to set up in the US after their imports into the US were uh badly constrained. Uh and then I think from there a lot of it come..."

"now uh apparently as a result of the tariffs is simply temporary pain for long-term gain. We just have to stay the course. Is that an accurate summary of what you're telling me? Well, I guess I'd pref..."

"if the goal is not to, you know, make America the assembly hub of the world but to actually re-industrialize you have to actually create incentives to to bring back those intermediate supplies. You ca..."

"believe we'll get longer in a later in August. There is uh various you know manufacturing sentiment indications. There is actual kind of industrial output capacity utilization these kinds of measures...."

"Uh, are you you know um what PMIs are right? Uh, yeah. But so what are Yeah. So I mean feel free to educate me. the Institute for Supply Management, which is a, you know, consortium kind of thing. The..."

"Bloomberg article from uh the first of this month. It said US factory activity contracted in June for a fourth consecutive month as orders and employment shrank at a faster pace extending the malaise ..."

"correlated with you know government statistics on how manufacturing is doing. And so I'm wondering where's the alternative statistics? Where are the numbers I'm not seeing that show good news in the m..."

"argument from the other side, right when the argument was, you know, okay we're going to aggressively expand free trade. We're going to embrace China. Um and oh, we got a lot of initial negative resul..."

"predictions of everything that was going to go wrong initially have have have essentially been wrong. I mean that what about the data I just read you? What about that? I mean that was an economist eco..."

"actually step back and recognize that it does seem the world's a little bit more complicated than that. I agree that the world is complicated and I agree that there's a lot of uncertainty over the imp..."

"economists about that pain in the manufacturing sector and that's exactly what all the data are showing us now. Yeah, I I've been extremely explicit throughout in in discussing tariffs that that there..."

"think the good news is that there are other dimensions on which we should see things sooner. capital investment construction, and so forth are going to be a leading indicator of that. But I'm I'm not ..."

"domestic production capacity. Um I I think if we see that and you know frankly in a lot of ways that that was already at elevated levels because of you know other things that Noah and I agree on like ..."

"as well. So I have a uh another question here which is that you've often talked about the um what you see as the shortcomings of economics you know as a discipline uh for predicting the effects of tar..."

"coming from? Well, I guess I happy to answer that in detail. I want to I figured no that that you were going to touch on the prior question also, but I'll I'll just add that's the prior question. I'm ..."

"sidetrack uh for me right there. I I you know I I wrote about all these things pretty extensively during the Biden years and I thought this is what we ought to be doing. But I think industrial policy ..."

"a bad sign to me, but I I accept that in 5 years we may see something else. I'm just sorry genuinely curious which because that was when I mentioned I'm very interested to see in August what the Q2 um..."

"Okay. Um yeah, I mean I think the uh I would just echo some of what uh you know what what Noah had just said about some of these other factors that that I think are really important as well because uh..."

"And and so me for me the question is what are the incentives for people pursuing private profit and and if we have policies that uh make it the incentive to offshore to uh you know try to bring in che..."

"overall would become enriched because of other effects in the service industry in other industries. And so when you're talking about these predictions that free trade with China would be uh beneficial..."

"know, there's definitely reasons why tariffs would have hurt the manufacturing sector and there's reasons why it could have helped. Um, for example, if you had uh used tariffs as a kind of bargaining ..."

"their currency would have been a good idea for our manufacturing industry and for us in general. Um, but that doesn't mean that tariffs are a policy that that if actually implemented help manufacturin..."

"then fine. That's certainly an argument you can make. But if we're talking about helping our manufacturing sector helping our people's living standards in general, hurting them double the amount we hu..."

"market such that we have a large market too so we can compete with the Chinese because we can match them for scale. Now the only way to do that given our small size is to get other countries to pull t..."

"is with China. You know when you when you describe Germany's strategy as export export export that is of course Japan's strategy and and Korea's strategy certainly vis the US v the US and so itap I me..."

"the total market size available to our manufacturers. And so I think we, you know, obviously trade deficits are always a sore spot because people have an inherent sense of fairness and they worry abou..."

"cars to Germany but Germany is exporting 12 billion of cars to the US unless you've created an extra $2 billion of demand for cars you've just reduced US car sales right um So if no you well I mean th..."

"Right? And so the point is that um when you when you have um two countries and they start trading, does the number of cars that people consume go up? Absolutely. Does it go up by more than the number ..."

"right but if you look at GM if you look at GM total vehicle production while you're looking that up I let me just make two related points one is that this strikes me as a a classic example of what goe..."

"flatlined since 2007. now since 2007. That's right. But during the time of the China shock, it didn't actually flatline. It actually rose. Yeah, there was still a period of increase there. But but if ..."

"US manufacturing grew and grew during the era of hyper globalization and during the you know increase in competition from Germany and Japan in the 80s and even during the initial increase of competiti..."

"must be getting destroyed. And that said, I do think trade deficits present a problem. Um, if they're too large, if they're for the wrong reasons if we're just borrowing to consume, it's a, you know, ..."

"No no that uh Yeah this this fascinates me, right? Because it seems to me that we're like if you think about okay what the Trump administration posture has been are you giggling because you're imagini..."

"I don't know. I um so if we're saying that we're going to use the threat of tariffs to establish a free trade zone you know, that's but that but that because of game theory, because the idea that acto..."

"response to this idea. The second point is if this is your argument, we're back in the realm of tariffs are bad, but they're a good threat because we're threating threatening to shoot ourselves in the..."

"latter. So those are two important counter-arguments I think to what you're saying here. Yeah. I guess I would just say on on the first point, first of all, it it apparently at least at the moment is ..."

"you were describing. Um and and then on the second point I I would just say it's interesting and and quite satisfying perhaps to the extent to which we are landing in in a a very similar place at the ..."

"could do it in a way that actually had long-term certainty and predictability. Uh, and if you could actually also then use it as a revenue source, which meant that relatively speaking, you're also nee..."