Return to Transcripts main page
AT THIS HOUR
Crucial Trade Negotiations Now in Washington after U.S. Slaps New Tariffs on Chinese Goods; China Retaliation on Trump's Tariffs Could Hurt U.S. Businesses; Stocks Drop 300-Plus Points as U.S. Hikes Tariffs on China; Trump Says "Absolutely No Need to Rush" U.S./China Trade Talks as U.S. Companies Suffer; Comey: Trump Would Face Obstruction Charges If Not President; Rep. Jamie Raskin (D-MD) Discusses Nadler, Pelosi Declaring Constitutional Crisis, Trump Goading Democrats into Impeachment; Giuliani Asking Ukraine for Investigations. Aired 11-11:30a ET
Aired May 10, 2019 - 11:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[11:00:30] KATE BOLDUAN, CNN ANCHOR: Hello, everyone. Thank you so much for joining me. I'm Kate Bolduan.
While you were sleeping, the United States and China plunged deeper into a trade war. Talks broke down, threats were made, and new tariffs set in just after midnight. Now both sides are back at the negotiating table this morning. The new tariffs that just set in may more than double the levy on $200 billion worth of Chinese goods coming to the United States.
And the president has been on a Twitter tear about all of this already this morning. Saying in one, "There is absolutely no need to rush," in terms of the negotiations. Tell that, though, to the American workers, consumers, and investors that are now left holding their breath at this very moment.
Chief business correspondent, Christine Romans, is here in New York with that perspective. CNN's Matt Rivers is at a Chinese port town with much more on that.
But, Christine, first to you.
What happened overnight? Where exactly do things stand this morning?
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Kate, it wasn't a bluff. President Trump jacked up tariffs on thousands of goods, of dishwashers, frozen fish, baseball caps. Right now, about half of everything the U.S. imports from China carries an import tax.
So how we got here. Look, three rounds of tariffs last year. First, the U.S. put tariffs on all foreign steel and aluminum, including from China. Then in July, Beijing was singled out again for tariffs on $50 billion worth of high-tech Chinese exports. China hit back with tariffs on $50 billion in U.S. goods, mainly ag products. That's been devastating to American soybean producers. The biggest round yet was in September, $200 billion in Chinese goods. This included consumer goods like luggage and handbags and hats. Beijing hit then $60 billion in U.S. exports in response. That $200 billion in September, that was originally taxed at 10 percent. Today, it's 25 percent. Remember, it's U.S. importers, not China, who pay those tariffs. Experts warn that Trump's tariffs could disrupt smaller American companies and overall economy. One analysis finds it could cost the U.S. the equivalent of 900,000 jobs and raising prices for the average family of four by $766 per year. Higher costs in your grocery carts.
And this trade war is not over. President Trump said he started the paperwork for 25 percent tariffs on another $325 billion in Chinese imports, just about everything you would go to the store to buy, in the mall to buy. And on top of that, Kate, he has until May 18th to decide whether to impose global auto tariffs if he declares car imports are a national security risk.
BOLDUAN: So the pain is setting in, it can get worse. It will be worse.
ROMANS: The president says, and said today, look, if you don't want to pay a tariff, then make it in America.
BOLDUAN: Let's talk about that right now.
Thanks, Christine. Great to see you.
BOLDUAN: I really appreciate it.
Let's go over to China. Matt, as I said, Matt is standing by with a reaction there.
What are you hearing there, Matt?
MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: Well, Kate, we're definitely going to see a retaliation from China. There's no doubt about that. The question is, how soon is it going to come, and exactly what form it will arrive in. We're not exactly sure. China's government has not said as of yet. But we have some idea based on what we have seen China do in the past. As Christine just laid out, this trade war has been going on for a long time now. So China could do a number of different things. It's already put tariffs on most American imports here. So there's well over $100 billion per year worth of goods that American companies send here to China. Most of them are already being tariffed. But what we can probably expect Beijing to do is raise the tariffs. Just like the U.S. did to Chinese products, we can expect China to do the same thing. But there's more things they can do beyond that. They can make life hard for American companies here. They can make market access more difficult. Let's say you're a pharmaceutical company from America looking to license a new product in China, well, maybe that's not so easy anymore. Or they can do more informal things. Like, for example, if you sent a perishable good, if you're an agricultural exporter from the U.S., you send it here, maybe the customs inspection at the docks, not far from where I am, that usually takes place in two days, takes two weeks and your products go bad, you lose money, your buyers have to go elsewhere.
Make no mistake, China hasn't said exactly how they're going to do it yet, Kate, but they're going to make life harder for American businesses. That's what happens in a trade war.
BOLDUAN: That's exactly right.
Matt, thank you so much. I really appreciate it.
So, of course, the question on everyone's mind is, what happens now. CNN business anchor, Julia Chatterley, is on the floor of the New York Stock Exchange for perspective there.
Julia, what are you seeing there?
[11:05:00] JULIA CHATTERLEY, CNN BUSINESS ANCHOR: Kate, you know, the billion-dollar question here, and you heard it there, is what happens next. I would argue that the optics here are pretty worrying. And investors are reflecting that and continue to do so. I think the hope is that, after today, that the two sides can agree to keep talking, even if a trade deal of some sort can't be salvaged, at least in the short term. As both Matt and Christine were just saying, the stakes just got that much higher. The tariffs on Chinese goods ramped up and then the president tweeted he's in no hurry to agree to a deal. That kind of leaves us in limbo. When he's saying, as Christine said, we're getting an extra $100 billion here thanks to these tariffs, it's U.S. customers, it's U.S. businesses that are paying it. Investors know that. And the risk is that, of course, puts pressure on the U.S. market here. So we're all just watching and waiting here. The path forward is the key question because it's like that REM song, everyone hurts here. It's going to come down to who hurts more, therefore, who is more able to drag this out to get what they want.
BOLDUAN: That's exactly right, Julia. CNN's reporting is U.S. officials don't see a deal coming together today. So then what? How do you see this playing out really?
CHATTERLEY: You know, in the end, it's going to, like I said, who hurts most here. The bottom line is China exports far more as a proportion of their economy than the U.S. does. And we know that China's economy is slowing. But the economy here in the United States is still going to feel it. Stocks could still fall further due to the negative sentiment. And we know how much President Trump watches both the data, the GDP data, the growth data here, and the markets very closely. And of course, you know, I have to bring it back to politics. President Trump has got an election to win in 2020. President Xi over in China doesn't. A lot of swing states in the United States export a lot of agriculture to China, too. So it's not just about the economics. There's politics here in play, too. Watch D.C. closely and watch what people say as they come out of this, and of course, China's retaliation. It's going to be a lively 24 hours or so, I think.
Kate, back to you.
BOLDUAN: And that brings up a really good point, who has the leverage today is not necessarily who's going to have the leverage tomorrow in these negotiations.
BOLDUAN: Excellent point.
Julia, thank you so much. I really appreciate it.
From Wall Street to Main Street, businesses, both large and small, woke up to a new reality this morning. The price of importing many goods from China just got more expensive. What does that and this stalemate we're looking at between Trump and the Chinese premier mean for them?
Let me read you one headline that grabbed our attention in the "Washington Post," "I employ hundreds of American workers. I would hire more if not for Trump's tariffs."
Joining me right now is the man who wrote that, Arnold Kamler, a CEO of the New Jersey based Kent International, one of the largest makers of bicycles in the country.
Thank you for being here. I really appreciate it.
ARNOLD KAMLER, CEO, KENT INTERNATIONAL, INC: Thank you.
BOLDUAN: Your family -- you have been in this business, your family has been in this business since 1907, is what you wrote, right?
KAMLER: That's correct.
BOLDUAN: You also wrote that your company is facing the greatest challenge, as great a challenge as you have ever faced in all of that time with Trump's tariffs, this trade war. Why is that?
KAMLER: You know, the business is a tough enough cycle dealing in a very competitive landscape. Whenever there's a price increase that we have, whether it's currency or now these tariffs, there's always a time gap between when we receive these price increases and when we can pass them on to customers. That means a pretty big hit for us. The other thing that happened last year was, as people were rushing to get goods in before the tariffs, everyone did it, including our competitors, and ocean freight rates skyrocketed and so we paid about --
BOLDUAN: Even the threats, the whiplash and threats in policy, that has even cost you.
KAMLER: A small company like us, it cost us more than $1.5 million in additional freight costs.
BOLDUAN: That wasn't even today. That was already.
KAMLER: That was last fall. BOLDUAN: With this increase, from 10 percent tariff to a 25 percent
tariff, just this latest round, if you will, do you know how much this could cost you?
KAMLER: It's -- we have not made a hard calculation because actually we thought talks were going really, really well.
KAMLER: As of a week ago, it seemed we were close to a deal and, suddenly, we have a crisis. But we know what the strategy is going to be and we're -- as you mentioned in your opening, we are paying these. When the goods come into the United States, before we get them, we have to pay the ocean freight, and we have to pay the import duty to U.S. Customs. Now there's not just the import duty. We pay import duty, approximately 11 percent on all bicycles. Now we're paying -- well, as of yesterday, we're paying 21 percent, and as of today, we need to pay 36 percent.
BOLDUAN: Is there any way you can avoid passing that on to customers?
KAMLER: Only if I wish to go bankrupt really quickly.
KAMLER: No. There's no way to absorb that. We have to pass it on.
[11:10:03] BOLDUAN: The president, as I said earlier in the show, has been on a tear on Twitter talking about elements of all of this today. And one tweet in particular stuck out to me ahead of our conversation: "Build your products in the United States and there are no tariffs."
Can you do that?
KAMLER: Well, we would love to. You know, we built bicycles in the United States from 1979 to 1991, and there was an American bicycle industry where about 75 percent of the component parts could be purchased here. There was a dumping action filed against China that was found not guilty, although Europe and Canada found huge dumping duties. That was somewhat political, I guess. And that certainly was the time for an action. But there's no industry. And we want to. We have even met with certain branches of the U.S. government and asked for a temporary relief from import duties where we could then start to make all these parts by ourselves, but they have kind of laughed at our business right now as an assembler that is not a real factory. I mean, so tell the --
BOLDUAN: Again, you can't do it if you want to -- you can't do it in this moment.
KAMLER: No, not right now.
BOLDUAN: You agree that China is a problem, though, right? KAMLER: China has been cheating for years and years and things have
BOLDUAN: If not tariffs, what then? If tariffs aren't the answer, then what then? Do you have a prescription?
KAMLER: Well, I'm not a politician. I don't have a prescription, but --
BOLDUAN: That raises an important thing. You're not a politician, but this country is so divided right now, everyone sees every criticism through a political lens. Is this politics for you?
KAMLER: There's no politics for me, no. This is the jobs of 200 Kent employees. And bicycles are very price sensitive. If our prices will need to go up -- they already went up about 8 percent last year. They probably have to go up another 8 percent to 12 percent if this thing goes through. And when bicycle prices go up, sales go down. And so I will try my very best, if this thing does stick, not to have any layoffs, but I can't make any promises like that.
BOLDUAN: That's a terrifying proposition. That must be very tough for you and all the employees.
KAMLER: Very difficult. We're a family business and we treat our workers like family.
BOLDUAN: You had written that already what was going on felt like a punch in the gut to you. You woke up this morning to see these tariffs are setting in. And what did it feel like?.
KAMLER: I woke up earlier, about 2:00 in the morning, I woke up and checked and saw it. I was really shocked. I really thought a deal would be worked out, but, hey, we have to figure it out.
BOLDUAN: What's your message -- if the president would listen, what would your message be to him today?
KAMLER: Slow it down. He said that there's no rush. Well, why impose the higher tariff? Continue to have the discussions. China needs to make a deal. We need to make a deal. This isn't good for the United States. It's not good for China. The public threats, which now were carried through, there's no need for it. Just talk and talk and talk. Chinese are tough negotiators. As you mentioned, President Xi is president for life. It's a tough battle for President Trump. But be patient.
BOLDUAN: Arnold, it's really important to hear your perspective and your honest and candid take on this and what it means for you as a business and for your employees. I really appreciate you coming on.
KAMLER: Well, thank you very much for inviting me.
BOLDUAN: Thank you very much. We'll continue this discussion. I fear this that this won't conclude anytime soon.
KAMLER: I hope it does.
BOLDUAN: Thank you so much. I really appreciate it.
KAMLER: Thank you.
BOLDUAN: Coming up for us, House Speaker Nancy Pelosi said the president is goading Democrats into impeachment. If that's the president's political strategy, does that make Democrats more or less likely to go down that road? A member of the House Judiciary Committee joins me next.
Plus, he co-founded Facebook and now he's calling for that very company to be broken up. Why is he speaking out now? Chris Hughes joins me live.
[11:13:53] Stay with us.
BOLDUAN: It is no secret there's no love lost between President Trump and former FBI Director James Comey. He wrote a whole book about it, actually. But listen to what Comey said in a CNN town hall last night about the president who fired him two years ago.
(BEGIN VIDEO CLIP)
ANDERSON COOPER, CNN ANCHOR: Do you think he had criminal intent based on what you have seen now in the Mueller report?
JAMES COMEY, FORMER FBI DIRECTOR: It sure looks like he did in connection with a couple episodes. The direction to Don McGahn to get the special counsel fired is, to my mind, a flaming example of --
COOPER: Of corrupt intent?
COMEY: Yes, of corrupt intent.
COOPER: There are now, I think, up to 800 former federal prosecutors, who have worked in both Republican and Democratic administrations, who have signed a statement saying that Mueller's findings would have produced obstruction charges against President Trump if he weren't president. Do you agree?
COMEY: Yes, I agree.
COOPER: No doubt?
COMEY: No doubt.
(END VIDEO CLIP)
BOLDUAN: This, as both the Democratic chairman of the House Judiciary Committee and the speaker of the House, Nancy Pelosi, are declaring the country has officially landed in a constitutional crisis. Joining me right now, Democratic Congressman Jamie Raskin, from
Maryland. He sits on the House Judiciary Committee.
Congressman, thanks for coming in.
REP. JAMIE RASKIN (D-MD): I'm delighted to be here with you, Kate.
[11:20:03] BOLDUAN: Thank you.
Constitutional crisis. All the lawyers I have spoken to about this, they say that the country is not yet there. You're not only a politician, you're also a professor of constitutional law. Where are you on this right now?
RASKIN: I never really understood the phrase itself, to tell you the truth. I mean, the Constitution is not in crisis. It's just a document. It's a political crisis that exists. And the president is dragging us on a downward spiral of lawlessness and corruption. So we're definitely in a major political crisis of constitutional dimension and ramification because of what the president has been doing to us. He's been running the government of the United States like a moneymaking operation for himself and his family and his business. And then it spills over into interference with law enforcement investigation, interference with the ability of Congress to do its work. So he's kind of shut the government down again with the policies he's been declaring over the last few weeks.
BOLDUAN: But with Nadler and Pelosi declaring we're in a constitutional crisis, and Nadler saying very clearly that phrase is thrown around a lot and it shouldn't, but we're here now, it's a very significant statement they're making. Do you fear that, I don't know, that you're backing yourselves into a corner by making such a bold statement, with the chairman and speaker saying that, as a constitutional crisis? Because I wonder how can you not move to impeach him if you really believe that?
RASKIN: Look, here's the critical thing. More than 800 federal prosecutors, former federal prosecutors, Democrats and Republicans, as well as the former FBI director, James Comey, have said what they're reading in the pages of the Mueller report is an open-and-shut case of obstruction of justice. And if the president were any other American citizen, he would be hauled into court and prosecuted and probably sent to jail. That's obviously a very serious business for the House Judiciary Committee and for Congress because it's our job to oversee the executive branch of government. We're the Article I lawmaking branch. The president's job is just to take care that the laws are fairly executed. But if he's frustrating the laws, thwarting the laws and violating them, that does create a huge constitutional problem for us. So you can call it a crisis, you can call it a confrontation, or you can call it a constitutional collapse or chaos, what Trump has brought us. But we do have to deal with the lawlessness that is coming out of the White House.
BOLDUAN: So let me ask you this. Speaker Pelosi last week said that the president is goading you all to impeach him. If he's goading you to impeach him because, obviously, the suggestion and the strategy might be that it would help him win support, does that make you less likely to support moving down that road?
RASKIN: I don't think we're going to be making decisions about something as grave and as important as high crimes and misdemeanors against American constitutional democracy based on public opinion polls and whether or not it's going to rally the president's base. Look, we know they're trying to goad us into impeachment --
BOLDUAN: Kind of sort of, I mean, it's a political decision. Public opinion dictates --
BOLDUAN: -- political decisions all the time.
RASKIN: Actually, it's a mixture of a legal decision and a political decision. The legal decision is are there high crimes and misdemeanors, meaning offenses like bribery and treason against the character of our democracy. And then, we have to make a political judgment about how it fits into everything else we're trying to get done. You know, on the Democratic side, we passed the toughest gun safety law in two decades. We sent it over to the Republican Senate. It's just sitting there. McConnell is not doing anything with it. We sent over equal pay for equal work legislation for women. They're not doing anything with it. We're trying to fight to lower prescription drug prices. They're not doing anything. The same kind of constitutional obstruction we're getting from the White House is the same kind of legislative obstruction we're getting from the Senate right now.
RASKIN: So we have to fight both on a proactive, positive agenda for the American people at the same time we defend the Constitution and the rule of law. And we're in the middle of doing that. We held the attorney general in contempt because he's acting in contempt of the American people and Congress. We have no kings here. No one is above the law. It's our job in the House of Representatives, the people's body, in the people's branch of government, to enforce the Constitution and the rule of law. We're not going to allow the president to act like a king and to trample the rule of law.
BOLDUAN: So let me ask you about this. Rudy Giuliani, he told the "New York Times" something that is pretty amazing. He said he's headed -- Giuliani is heading to Ukraine to try and get the new president there to investigate two things. One, the origins of the special counsel's Russia investigation, and also the involvement of Joe Biden's son in a gas company owned by a Ukrainian oligarch and whether the former vice president had any hand in helping him.
BOLDUAN: He was asked about kind of the outrage factor of pushing a foreign government to launch investigations into your political rivals, and Giuliani said this to the "New York Times": "We're not meddling in an election. We're meddling in an investigation which we have a right to do. There's nothing illegal about it. Somebody could say it's improper, and this isn't foreign policy. I'm asking them to do an investigation that they're already doing."
Is that OK? Is it fair game?
[11:25:08] RASKIN: It's not OK. Look, all of the dictators and despots and tyrants and kleptocrats and bullies around the world have found each other. So it's Orban in Hungary and Putin in Russia and Trump in the United States, and Duterte in the Philippines. And they're trotting around the world, like Steve Bannon is, trying to organize the Alt-Right extreme racist and nativist and anti-immigrant elements all over the earth, and it's a terrifying thing what's going on. We have to stand up for constitutional democracy in America against these attempts by the Trump administration to engage in continual deception and stonewalling of Congress and the American people. So they do want to go back to investigating their fantasy Deep State conspiracy about Peter Strzok and Lisa Page. This is what they want to focus on. They're not interested of doing the work of the American people. They're not working with us on health care. They're trying to take away pre-existing condition coverage. They're not working with us on prescription drug reform. None of that. And they're not working with us to try to get to the bottom of what happened in the 2016 election so we can prevent a repeat in 2020 and we can protect the character of our political democracy.
BOLDUAN: Congressman, thank you so much for coming in.
Giuliani told CNN today, in a question about all of this, that it's not meddling because the election is a year and a half away. That is the latest from Rudy Giuliani.
Congressman, thank you for coming in. Appreciate it.
RASKIN: Thank you for having me.
BOLDUAN: Coming up for us -- of course -- he's the co-founder of Facebook, who is calling for it to be broken up. Now, Facebook is hitting back. Chris Hughes joins me live, next.
Stay with us.