President Trump quoted comments made by real estate billionaire Sam Zell Wednesday morning on CNBC about the trade war with China:
“The Chinese are very adept at not accepting anything. You’ve got to be very tough, and that’s what Trump is doing. It’s in China’s interest to correct, and I think we’ll end up with a solution that’s dramatically better than we have today. Frankly, I think the impact of what...— Donald J. Trump (@realDonaldTrump) September 4, 2019
....We can’t have a system where we run our entire economy for the benefit of other countries, which have long charged us big tariffs. Don’t keep ducking the reality. The U.S. has been subject to Tariff Terrorism for 50 years. But a real deal can be done.” Sam Zell @JoeSquawk— Donald J. Trump (@realDonaldTrump) September 4, 2019
SAM ZELL: I can't help but think about the army mule, you know they tell a story about the army mule, you know, how do you get an army mule's attention? You whisper in his ear, but first, you hit him over the head with a 2x4. I think that's what we're dealing with. In other words, you know, the Chinese are very adept at not -- you know, not accepting anything and so you have to hit them over the head and I think that's what Trump is doing.
CNBC HOST: How long do you think this plays itself out for I know you've been waiting for --
SAM ZELL: I don't know the answer to that. I mean, there's so much here, in my opinion, that's in China's interests to correct and there's so much interest in the U.S. to do something that I think that sooner rather than later people will come up and face reality, and I think we'll end up with -- end up with a solution that's dramatically better than where we are today.
CNBC HOST: You know, people who are -- who spent time over in China say that the Chinese get their back up, you know, they have pride on the line in this too. So how do you find a solution, as somebody who's a made a lot of deals over time, how do you find a solution and make it look like face-saving all around?
SAM ZELL: I have been involved in an awful lot of transactions and I have been involved in a lot of, you know, face-saving scenarios. And the answer is, if people decide that they don't want to be embarrassed, quote, and then they won't be. And if they decide that they won't lose face, they won't, and I think that the issues are much broader and much bigger and frankly, I think, the impact of what Trump is doing to China is not lost on the rest of the world. So, you know, Europe which has had, you know, among the most protectionist policies forever is sitting there saying, gee, are we next? Maybe you are.
You have to basically change the rules. The United States can't -- just like we can't defend the world and pay for it, we can't run a system where we run an entire economy for the benefit of other countries.
CNBC HOST: People forget that, Sam, that if Trump said, all right, everybody over there remove your tariffs, we'll remove all of ours, we would do it.
SAM ZELL: Sure, in a minute
CNBC HOST: So it is not the way it happened
SAM ZELL: The American people today probably think that all these other countries don't have tariffs.
CNBC HOST: I know. I wonder why.
SAM ZELL: Because we've had a philosophy -- Keep ducking the reality. Keep not acknowledging the fact that the U.S. has been subject to tariff terrorism for, you know, 50 years. The post-World War II reorganization was nothing more than a reorganization in which the United States took responsibility for the defense and the economics of the world.
CNBC HOST: Let me ask you this to the extent the tariffs are considered by some a tax on the American public, how long can that go on? If a deal gets done, is it a real deal? Does it have teeth? Does anybody care? What happens in the markets?
SAM ZELL: Well, I think that, yes, I think it can be done, number one. Number two, I think people won't care because it will upset precedent as to what people are going to scream about or not scream about. So I think it is doable. But it requires everybody in -- everybody on the same page everybody pulling on the same direction. And we have created an environment over the last -- since the end of World War II -- where the United States took all the responsibility and the result has been relatively disastrous.