123. The Shutdown Cover-Up: Epstein, Trump, and the Hidden Agenda

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2:27I've been promoted. I'm bringing us in. Welcome to The Rest is Politics, U.S. with Anthony Scaramucci. And Katty Kaye. Feeling a little under the weather. Not that that's why you've been promoted. You've been promoted because you're so good at what you do. Soon to be demoted again as I rumble through this. But Katty, here's what we're going to talk about, okay? We're going to talk about the trade war. Trump is on tour in Asia, kicking off with Malaysia. He's going to meet with Chinese President Xi later in the week. Things are getting ugly with Canada. I don't know if we're allowed to use butthurt on this podcast, but let's just use the words but and hurt together because that is the president right now.

3:06Never have true words been spoken about tariffs from Ronald Reagan. And of course, they are playing those ads all throughout the American World Series, the baseball World Series. And so he's got tariffs. We're shut down. We're not going to be talking to Canada for a while. And there is the indomitable Mark Carney. Indo what? Say that again. Did I say it right? Indomitable? Close enough, right? Indomitable. Indomitable. All right. Look, you're going to help me with my language. Okay. Last week, you blew me up. My wife has bought Caddy a shirt I'm with Stupid as a result. That's going to be my Halloween costume.

3:41As a result of me misusing the word Randy. If you didn't hear that, you can go back to last week's podcast where I - I'm glad Deidre enjoyed it. fully embarrass myself. But here we are. We're back. We're going to talk about the government's shutdown in the second half, the problems there. Let's go right into it here for a second. Trump is in Asia. He's got a tremendous amount of energy. You got to give him credit for that. He's 80 years old, comes off the plane. He's doing his little YMCA dance as he gets into Malaysia. He's signing some small trade deals. He got a deal done with Albanese, which we didn't talk about, which I think we should.

4:19It's a mineral rights deal. It's a very smart thing for the Australian government to go in prepared as they were. Here's the deal, Mr. President, it's going to make you look good. We're going to sign this thing and it's going to give you rare earth minerals into the US economy away from China. So he's got a couple of wins he's clicking with right now. But where do you think things stand for Trump in Asia? And how do you think it's going to go with President Xi? Look, it's interesting that you look at the cover of The Economist from last week, which has two basketball players, and the cover is that China is winning the tariff war.

4:57It's the Chinese player that is about to score and not the American player. And I think the White House has realized that the Chinese have cards and know they have cards and are prepared to pay those cards. So every time Donald Trump ratchets up tensions with the Chinese, he very quickly rose them back again. So when the Chinese said that they were going to limit exports of rare earth minerals, which is part of the reason he did this deal with the Australians, by the way, and it was so smart because the Australians do have some rare earth minerals, but the country with the big amount of rare earth minerals is China.

5:33China has them. They know they could grind the American economy to a halt if they really did limit exports because they are needed and everything from our washing machines to our missiles. And then the Americans say, the White House says, okay, we're going to put 100 % tariffs on China. And within a couple of days, Rose back again. And now you have Scott Besant coming out saying, okay, we've got a good framework for a deal. There aren't going to be limits to mineral exports. There aren't going to be 100 % American tariffs on Chinese products. But the sense we've had ever since Liberation Day is that the one country in the world that knows it has cards and is prepared to play those cards against America is China.

6:19And they've done a good job diversifying their economy. They've set up other markets. They've realized they're in a strong position. And they know that the markets react badly when the White House threatens to hit China. So I think there's a whole load of reasons that Donald Trump goes into this meeting with President Xi this week, which would be a kind of historic meeting, as a partner, not as the stronger character that he is in all of these other trade negotiations. And that's an unusual position for Donald Trump to be in, right? I mean, tariffs for Trump are power. This isn't really a tariff war, it's a power war.

6:54And if you frame it like that, China is an equal player in this power war. I'm going to bounce a few things off of you. First of all, I think Xi is way more prepared for Trump 2 this time than he was for Trump 1. Number one, he anticipated all this and he's parried well. I think that there's two things going on that I'd like to analyze. One is US consumer market, largest consumer market in the world. Chinese manufacturing market, largest supply chain manufacturing market in the world. Ergo, these two countries need each other. They Like you and I need oxygen. So the real question is they really can't avoid doing some type of deal without harming each other's economies.

7:43But my question to you is really related to the underlying surface cracks in China. So as an economic analyst, again, I'm not a China hawk. There are China hawks in America that would say, hey, the real estate market is crumbling there. There's lots of zombie buildings all over China. The seven provinces of China are balkanizing to an extent. Xi has to make concessions from the Chinese Communist Party to keep this sort of balkanizing from happening further. And so there's underlying surface cracks in the Chinese economy where he needs to do a deal with Donald Trump. Two things can be true at once, right?

8:27Yes. Yes. Of course, there can be problems within China in terms of debt, the housing market, unemployment, and unhappy youth. But at the same time, China can have spent four years preparing for Donald Trump 2.0 and be in a stronger position than they were four years ago and have things that the Americans need. And Xi is patient. He's playing the long game. This is a guy who survived the Cultural Revolution. He spent time in a cave during the Cultural Revolution. He was pilloried on stage by his classmates and his own mother. He's pretty resilient. This is not somebody who caves easily. I have an enormous amount of respect for him.

9:07He's done a great job. If you are an authoritarian listening, he's done a great job of consolidating. He's your guy. Yeah, exactly. For all our authoritarians in the audience, who would like to propose somebody for you? Yeah, no. He knows how to consolidate power. Do we have a lot of authoritarians listening? I don't know, Caddy. You know, I don't know. There could be some authoritarians on this podcast. Okay. If you're on YouTube and you see me mouthing help, you know what I'm talking about. But anyway, he has quieted dissent and he has definitely put to bed issues of him not going anywhere. I mean, he's going to be the premier.

9:49I mean, I think it would have to be something very difficult. I'm always careful about saying that, though, Kat, because the CIA said that the Shah, about three months before he was deposed, he said we're in a permanent state of political tranquility in Iran. So I don't want to overstate that. In that meeting with Putin and Kim Jong-un, they were talking about living to 100 and whatever. And replacing their own body parts and things like that. I don't buy that necessarily. He's an old guy. At some point, he's going to move on. But I think the phrase authoritarians like to use is he has effectively consolidated power at home.

10:23And quieted dissent. But let's go to TikTok for a second. I wish I could do that on this podcast. You're doing that. Trust me, you're doing that. I was like a rag doll last week. I was just getting slammed around like a rag doll. It's fine. But anyway, TikTok. I don't see TikTok going into the hands of the U.S. government. I don't see TikTok's ownership. there's no way that the chinese government is going to give their algorithm this weapons grade intelligence gathering this weapons grade propaganda device where now white males below the age of 30 25 of them believe that the moon landing was faked you remember those screeds on tiktok last year praising osama bin laden uh which uh people took to in the united states quite favorably.

11:15This is weapons grade intelligence algorithms. This is weapons grade propaganda algorithms. This was supposed to be shut down by the legislature in the United States, the Congress and the Supreme Court. Trump blocked that. It's still going. Is that illegal, what he did, by the way? Because when I talk to lawyers, the one thing they point to is the fact that TikTok is still operating in the States as a sign that Donald Trump is in defiance of the law. Yeah, well, no, of course it's illegal. Yeah, no, he was ordered by the Supreme Court to shut it down, but nobody has pressed the case. No one has gone to a US marshal and said, here is a court order.

11:57I'm suing on behalf of the people of the United States pursuant to this Supreme Court decree. Trump has the seven, the mag seven tech companies in his pocket. They line up behind his family members at his inauguration. They're giving him all different types of money. They're helping him desecrate the White House and build this ballroom that's larger than the White House itself. And so they're all in cahoots with him. They're not going to do anything to him. And no one's pressed the case. And of course, there's a lone wolf Republican in the Senate, Rand Paul, who's being eviscerated by Trump. He's being left out of all the reindeer games, Caddy.

12:39But he's the only one speaking up. He's the only one. Truth to power. Here's what the constitution says. Trump is way outside the boundaries of the constitution. But you tell me, so you think Basin said on Face the Nation this weekend, the TikTok deal is done. It's just a formality now. So the Chinese government, the People's Liberation Army is giving up this weapons grade algorithmic technology to the American government. No problem. You think that? So no. Besant went on and said that it was, I don't know why he used this word, but anyway, he said the deal was about to be consummated and that the details had all been ironed out.

13:21But what he didn't do was get into the specifics of what had been settled and whether there had been substantial changes in the deal. I find it very hard to see the Chinese giving up something that is enormously useful to them. I mean, we don't have the evidence that the Chinese have weaponized TikTok, but it is an incredibly powerful weapon that they have over young American public opinion if they choose to use it. So why wouldn't they want to hang on to the algorithm, which is what it looked like was originally going to happen? Whatever Scott Besson said, I'm not sure I see this deal getting done.

13:57Maybe they'll pull something out of the hat, but I don't see it being done in a way that the Chinese relinquish something that both gathers enormous amounts of data on Americans for use by the Chinese government and also gives the Chinese government, should it so wish, an extraordinarily powerful way to influence American public opinion. Something's happening right now though, Cady, that I'd like you to address because when I look at the raw data, the Chinese, we used to talk about this before the global financial crisis, that there was going to be decoupling. That never happened. If the US caught cold, the rest of the world got pneumonia.

14:35But the Chinese right now, their year over year shipments to the United States have fallen by 27%. Yet their exports have risen 8.3%. When I said to you that they had done, they have figured out how to have alternative trade routes and trade markets, that's what they've been doing. So they actually are managing to diversify their markets. Yes, they still need the American market. But by the way, the American producers clearly in the form of American farmers who produce soybeans need the Chinese market as well. And when the Chinese say they're not going to import any soybeans and don't import any soybeans, it hits Donald Trump's base, which is why that's an important part of this trade deal that needs resolving as well.

15:24You got a depression. You got to honestly down 35 % in terms of the farm revenues, farming revenues down 35 % across the farmland. It's huge. And those are Trump voters. Yeah, you have a mini depression going on across the farmland because of this. I think the trade war has made Xi more popular at home and stronger at home. Trump bullying him has helped him, as it does in many cases. When an adversary lays into you, you rally around the flag, which is what Chinese seem to be doing, according to what, I mean, it's hard to measure public opinion fairly in China, but that's what Chinese experts are saying.

16:06And I think this is a pause in tension, not a resolution. They finished off on China in a war of attrition. They are going to win that war. The Americans don't have the patience for that war. And the Chinese, no problem. They know how to suffer if necessary. So I got them. They take the long game. Yeah, I got them edged up. They have slight upper hand to Trump right now. Should we move on to the real national security threat, though, facing the United States? I mean, there is a massive national security threat coming at America from its northern border. And that national security threat is Ronald Reagan.

16:39And I think it's going to be a little hard for Donald Trump to go to the Supreme Court and say, I have to have the right to subvert Congress, go around Congress. I have to have the power. I mean, Donald Trump has to have the power because there is a national emergency threat to the United States. And it comes in the form of Ronald Reagan's words being used in a Canadian ad. I don't know. I'm not sure that even the Supreme Court is going to buy that argument. Explain what's going on, Anthony. I'm being a little opaque. Premier Ford, basically, of Ontario, he basically launched this ad or just took the words of Ronald Reagan.

17:21It was interesting that the Reagan library reprimanded him for it because he left a few sentences out. But the whole gist of what he said was there. Reagan had learned from the Depression that high protectionism and high tariffs cripple the US economy, cripples the global economy, and Reagan was by and large a free trader. Now, I have said on this program that no trade is free, Caddy, and so we have to understand that there's always going to be economic interests of different parties where they're going to ratchet some levies on each other, but we have to generally have free trade if we're going to promote what the great economist David Ricardo once said about the world, is that we can't in our own nations produce at the lowest cost everything.

18:09But if we can find the other nations that can produce at the lowest cost and trade with them, then we create this win-win and way more economic bounty, way more economic prosperity. That was Reagan's whole philosophy. So now the Ontario government is out there saying what Ronald Reagan would say, and I'll use the exact quote, tariffs hurt every American. and they took of course uh reagan had this very famous thing that the presidents don't do anymore trump doesn't do it he had a radio address every saturday morning and so he would record it on friday night and it was a five or six minute philosophical radio address this is what uh the government of ontario took and trump went crazy trump said that this is a fraud this is a lie and Reagan was a protectionist and all this other stuff.

18:59What is true, like every president, Reagan did go through trade agreements and say, well, I've got to protect our steel manufacturers here or auto manufacturers there. He used tariffs as a scalpel, right? Exactly. He was forensic about it. Yes, surgically about it. He didn't like them. He didn't like the impact of them. He used them surgically. Trump likes tariffs because they are unchecked power, because he doesn't have to go to Congress, because he believes he can put tariffs on his adversaries, even on his allies, to get what he wants. But he likes them as a form of wielding power in the way that he likes pardons.

19:38He likes pardons because he doesn't have to go through Congress. He likes tariffs because he believes he doesn't have to go through Congress. And at the moment, the Supreme Court, which is going to hear this case and rule on whether this use of tariffs as a tool of national security is legal or not legal, at the moment, the Supreme Court is kind of sitting on its hands, which is allowing Trump to use tariffs in this way as an extension of foreign policy, which is something that Reagan didn't do. He didn't use them as a way to hammer adversaries or allies into doing his will as a form of foreign policy.

20:14And I think that by having the hissy fit, frankly, that Donald Trump had over the weekend about this ad that came out of Ontario that played at the World Series in Toronto in the baseball game, I think he makes it harder for the Supreme Court to side with him because it's so clearly not slapping an extra 10 % tariffs on Canada because of this ad and linking them to this ad in his Truth Social post is so clearly not an issue of national security. So I'm with you and I think it's a fairly clear cut case. If you look at the district court, the president lost in the district court related to the tariffs.

20:56The appellate court said, no, no national security reason. These are actually tax levies. These are tax increases on the American public. Of course, no taxation without representation. And so, I mean, the constitution, it's all very clear. Rand Paul has made this very clear. But I want to empathize with the president for a second. if that's possible. And I want to say that he sees this as a leverageable tool against everybody. That would be our allies and our adversaries. He also believes that these sort of punitive tariff measures have incentivized people to do things that he wants. And so before the court will be, does the president deserve some flexibility?

21:48Here's the law. It's black and white in the law. But now here's the reality of the world. Does the president deserve some flexibility? What do you think, Katie? You and I have talked about this before, and I actually have spoken to a few constitutional lawyers who think this court will side with Donald Trump on this. This is a court that believes that the executive, the president, actually does deserve a large amount of latitude when it comes to issues of national security and presidential authority. And it's a court that likes the expansion of executive power. So my feeling has been that this court probably will side with Donald Trump on tariffs.

22:31But I think this kind of thing reacting to an ad of Ronald Reagan's words doesn't make the court's job easier. It doesn't make it easier for the Trump presidency to side with him. So I asked my former colleagues and some of these people are still I consider friends even though we're ideologically opposed. I've asked some of the people in the MAGA world what is the B in President Trump's bonnet related to Canada. And okay, you ready? Okay. He believes that the Canadians have gotten a quote unquote North American free ride on our military. That's what he believes. He believes US taxpayer is subsidizing Canada.

23:19Now he uses$200 billion, which I think is a wildly exaggerated number. But the question really is, is there a number, Caddy? And I believe there is a number of subsidy from the American military in the sense that if anything happened in North America, the American military would be there to protect both nations. So what do you say about Trump's claim to this? I would probably remind him that Canadians fought in Afghanistan. 165 Canadians died during Canada's mission to Afghanistan. and as far as I remember the attacks of 9-11 were against the United States not against Canada and that in times of need Canadians have stood with Americans.

24:01I think that's well said and I think that is a very very good position and that's obviously Carney's position but you're not going to move Trump on this. No, you're not going to move Trump on this unless you get into the middle here. And this is where I think Carney's going to do a good job. I do believe that, you know, listen, the Canadian government said, okay, no problem. We're going to apologize for the ad. Trump said, hey, you apologize too late. I'm such a baby saying that, but that's fine. But I do think Carney will find a way to meet him in the middle. But I will say this, I think the relationship between the US and Canada could be generationally changed.

24:43Just hear me out for a second, Caddy. If I were a prime minister in Canada, I'd be like, hmm, the Americans, are they really doing this? I mean, we had this great cohesive relationship for a hundred plus years. I've got to build trading relationships. I've got to build free trade relationships with other parts of the world. I got to do exactly what China has been doing, which is working the rest of the world for my goods and services products, products, raw materials, rare earth materials, et cetera, and be less reliant on the once very dependable United States. Am I wrong in thinking that, Cady?

25:21Yeah, no, I think that's right. And I think that's what the Canadians are doing. They are talking to the Europeans. They're trying to diversify their supply chains from the United States to get them instead from Europe, to get more from Europe for the supplies they need and do what the Chinese are doing, diversify their markets as well. So I think they're trying to do that, but the reality is they share this incredibly long border with the United States. They, of all countries, really need that trading relationship to go well. And I mean, the thing is the Premier Ford of Ontario understood how to get under Donald Trump's skin.

25:55Donald Trump moved a massive portrait of Ronald Reagan from the hallways into the Oval Office. If you look at shots of Trump in the Oval Office, Reagan is kind of looming over his shoulder every time. He likes to be compared favorably to Reagan. He hated the idea that he and Reagan were not aligned on the policy of tariffs. And it just showed how easy it is. it's so personal with trump and that makes it easy for america's adversaries to get under his skin in a way that is not particularly normal with american presidents who tend to be a little bit more dispassionate about these things um so maybe the now what they have to do is run an ad favorably comparing ronald reagan to donald trump or something i don't know you you it's it's kind of easy to play him because you can play him either way so let's go for the flattery next time around.

26:45It's sort of insane that we're saying it that way. But again, if you said to me, who has the upper hand? China has a slight advantage right now over the US just in terms of its ability to win the war of attrition and also the diversity of their exports now. And believe it or not, Katty, I actually think despite the difference in the size of the economies, countries, Canada has economically a slight advantage and Carney does know this. And so just if you took the landmass of Canada, landmass of the United States, and you dialed into the balance sheet and you said, okay, here is the worth of the minerals, here's the worth of the oil, here's the worth of the aluminum, et cetera, in each of the countries on a per capita basis, is Canada has more per capita than the US because it has more or less similar size land mass with 10 % of the population.