Bloomberg Audio Studios — podcasts, radio, news.
So here's the latest this morning. The President of the United States, Donald Trump, cancelling European tariffs that were set to begin February 1st after reaching a framework deal over Greenland. The US Commerce Secretary, Howard Lutnick, joins us now, making some waves at the World Economic Forum over the last couple of days. Mr. Secretary, it's good to see you.
Let's cut through the drama. Let's get to the big point, the elephant of the room. What happened at dinnertime the other night? I've heard all kinds of stories — booing, Lutnick storming out the room. What happened?
Oh, this is so silly. So at the end of the evening, they called on me. I just published an op-ed in the Financial Times, and so they called on me. I gave, I don't know, two or three minutes on my FT op-ed, which basically said that globalization and the outsourcing of your industry to the lowest cost in the world had really harmed America, it had harmed Europe, and it had failed us — and that we need to reshore, we need to take care of our own citizens. So that's basically the model. And when I was done with that two or three minutes, one person of the 200-odd people in the room booed, and I felt honored, because it was Al Gore. You know, Al Gore booed, and I was like, really?
Hysterical — nobody was throwing bread rolls at you from the bank. That wasn't happening.
No, I mean, I put it in the FT. I mean, I wasn't like trying to be quiet about it. I mean, I think that globalization, and the idea of global supply chains and finding the lowest cost, that is just not the way to take care of your auto workers, right, who are in Ohio and Michigan. And so we're bringing that back. So think about this. When we were done — we started auto tariffs, we started working on it in March and we finished in November. And the last day, when we finished, General Motors and Ford stocks each went up 10%. General Motors ended the year up 60%. If I told you on January 1st that General Motors was going to be up 60%, you would all have said, 'Oh, stop it.' And how about this? On that same day, Shawn Fain, who runs the United Auto Workers, called me and said, 'I can't believe I'm calling a Republican Secretary of Commerce to say thank God for you and your administration. You're the first administration who's actually taking care of the auto workers of America.' So think about that. You can — if you really think it through — you can take care of the company and the worker. You don't have to pick sides, because we want union labor growth in America. These are great jobs. Why wouldn't we want them in America? So that's why Donald Trump wins the union vote, because he's actually pro these workers. He literally is pro these workers. It's not a political thing. These are great jobs for Americans. Let's go get more of them.
There's a lot of money set to come into the United States — big bets, a ton of FDI, and we can get into that in just a moment. I just wanted to stay on G7 allies. This week's been quite a week. Emmanuel Macron, the French president, has basically accused the US of trying to subordinate the Europeans. The prime minister of Canada — I'm sure you've heard his speech, Mark Carney — said, 'This is not a transition, it's a rupture.' How would you describe relations with those countries at the moment?
I think our relations are perfectly fine. Right. I described the relationship with respect to the whole — when Greenland was going back and forth before we sort of settled it with a framework agreement, right? I called it a kerfuffle, right? It's basically like if you have an argument with your spouse that's not real, you know, it's not a real one. It's like a small thing.
My spouse doesn't go out there and deliver a speech after that argument and say it's the end of the relationship.
Fair enough. But you're right. And I think they overreacted. And it's proof that they overreacted, because a day or two later there's a framework that makes sense, right? What did we say? We said we cared about it for national security, right? We said we care about national security. I mean, it's obvious we care about it for national security, because if you're going to build a golden dome over the United States of America, right, wouldn't you prefer the Golden Dome cover Greenland? So when you're knocking out the missiles, you're not knocking them out right over your head. Like we've all seen Israel knocking out the missiles right over their head with their Iron Dome. Wouldn't you prefer to knock out the missiles if you live on the east coast of the United States of America, over Greenland, a couple of thousand miles away where there's no people, right? Doesn't that sound better? So this is sort of where we're thinking about it and how our national security team is thinking about it.
So what's actually in the framework?
Well, the framework is a national security-based framework — that's what the United States cares about. We care about our national security and we care about the shipping lanes. So let's talk about the national security and shipping lanes and let's see if we can't figure out a framework to do that together. And I think that's what the president truthed about. He said we're going to try to figure that out together, because those were the key points that the United States of America cared about. And I think the president's been clear about it and he just wants people at the table dealing with it swiftly. I mean, think about this. He sends out a truth and, like, within four days, right, we have a framework agreement. Like, that's — by the way, that's pretty effective.
We had tariffs on, tariffs off. What does this do?
The threat of them coming on for February 1st. What does this do now for the agreement you and your team struck with Brussels, because the legal implementation has now been put on hold?
Oh, I think it'll be put on hold probably tomorrow. I mean, come on. That's why I said it's an overreaction. I mean, they know when the president says this is what's going to happen. I mean, what provoked the president? What provoked the president was that they sent military people to Greenland. I mean, they didn't send military people to Ukraine. Like, why are they sending military people to Greenland? You know, it seemed like a provocation.
We spoke to the Finnish leader and he suggested that was a miscommunication and he cleared that up pretty quickly. There's something I want to get into with you that I think is quite important. This, of course, is the art of the deal. We talk about it on the program all the time. The president anchors the story to the extreme and then gets a favorable deal for the United States. I think that's well understood. Something happened though in the last 12 months that I think is really interesting. He tried the same thing with Canada and totally upended the election in Canada, north of the border. Poilievre was going to sail away with that. The reason Mark Carney's here as prime minister is because the president took such an assertive stance on Canada. Now at the time I was finding the humor in the conversation. Then the Canadians started lighting up the Bloomberg terminal, sending messages. They were deeply offended, and we've seen that damage the economic relationship with Canada and the United States. And the risk here, Mr. Secretary — and I'd love your thoughts on it and your reaction, because I think this is really important regarding the Europeans. The points you're making about Europe, and have made over the last week, are valid points and they're actually well received by a lot of Europeans, but the style in which it's being delivered at the moment — some of them are finding it offensive. Do you think there's a risk here that we damage the economic relationship with the Europeans in the same way we did with the Canadians and, for that matter, derail the conservative movement in Europe that's well underway?
