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The Situation Room
Interview With Sen. Maria Cantwell (D-WA); Canada Responds to Trump Tariffs; Interview With U.S. Commerce Secretary Howard Lutnick. Aired 11:30a-12p ET
Aired April 03, 2025 - 11:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[11:30:43]
PAMELA BROWN, CNN HOST: All right, let's get back to the breaking news, the global backlash against President Trump's worldwide tariffs.
I'm back with President Trump's commerce secretary, Howard Lutnick.
So, the European Union and China, they have already vowed to retaliate. At what point would the administration consider pulling back on tariffs, especially on those 10 percent across-the-board tariffs? Where is the room for negotiation?
HOWARD LUTNICK, U.S. COMMERCE SECRETARY: I don't think there's any chance they're going to -- that President Trump's going to back off his tariffs. This is the reordering of global trade, right? That's what's going to happen.
But the world should stop exploiting the United States of America. Let our farmers sell their products. Let our ranchers sell their products. They won't take lobster in Europe or the U.K. I mean, why won't they take American lobster?
BROWN: I think they do actually now. They do. They didn't for a while, but now they do.
(LAUGHTER)
LUTNICK: They don't. They don't.
BROWN: But so -- OK.
LUTNICK: Because Downing Street said they're going to start with -- they changed their trade policy. They're going to start having lobster dinners in Downing Street.
BROWN: All right.
LUTNICK: So that's what they told me.
BROWN: Well, let's...
LUTNICK: So, the point is, let's let American workers succeed and prosper. Let's build factories in America. Let's let us export to the world.
BROWN: OK.
LUTNICK: They can't really fight with the United States. We are the customer of the world.
BROWN: Let me just follow up with you. And, by the way, in August 2020, the E.U. did agree to eliminate tariffs on fresh and frozen American lobsters. Just fact -- quick fact-check.
LUTNICK: But, remember...
BROWN: But hold on. Hold on. No, no, no, no.
LUTNICK: ... it's not tariffs. It's non-tariff trade barriers.
BROWN: Let me -- I'm just doing -- OK, fine. I understand what you're saying there.
LUTNICK: Come on, remember, they wouldn't let -- Korea wouldn't let french fries come in.
BROWN: I understand. Hold on. Secretary, I understand.
Let me just follow up, because I want to just be very clear here, because allies and adversaries alike are looking at everything you're saying right now about whether there's room to negotiate on these tariffs before they announce what they're going to do.
What I hear from you is that there isn't room for negotiation. Is that right?
LUTNICK: There is room...
BROWN: You said that the president won't back off.
LUTNICK: What I said very clearly...
BROWN: OK.
LUTNICK: ... the president is not going to back off, but there is room...
BROWN: So, he's not going to back off of what he announced yesterday? That's cemented?
LUTNICK: He is not going to back off. He's not backing off.
BROWN: Nothing could change that?
LUTNICK: But countries can fix their tariffs, their non-tariff trade barriers, which are much, much rougher.
That's why the story I was trying to tell you is that, when we took cars from Korea in 2012 -- when I grew up, there was no Korean cars in America. When we took cars from Korea, the deal was, we could sell ag to Korea. That was the deal. They wouldn't let McDonald's bring in french fries because they couldn't prove the origin of the french fry.
That is not a tariff. That is called a non-tariff trade barrier. They take their taxes and they subsidize their steel industry or they subsidize their energy or they subsidize -- or they give the tax back to their car manufacturer.
BROWN: Right.
LUTNICK: This stuff has got to stop.
BROWN: Let me just follow up.
LUTNICK: America's got to stop being exploited. And you're going to see America prosper.
And then, and only then, will Donald Trump make a deal with each country, when they have really, really changed their ways. Then they go sit with him.
BROWN: So, it sounds like he might back off down the road, but not right now.
LUTNICK: That's not back off. And that is not back off.
BROWN: OK, so, let me -- so, then let me just...
LUTNICK: That is, let the dealmaker make his deals when and only if these countries can change everything about themselves, which I doubt they will, because the VAT is the VAT.
BROWN: So he is willing to negotiate, then? So, he is willing to negotiate with these countries right now, or if they decide to...
(CROSSTALK)
LUTNICK: Negotiate is talking. No talking. Doing.
BROWN: Well, because...
LUTNICK: These countries have abused us and exploited us. As he said yesterday, they need to change their ways.
BROWN: All right, let me follow up with you.
LUTNICK: Let's see them change their ways. It's going to be a long time. Let's see what they do. Not talking.
BROWN: OK.
LUTNICK: Talking is nonsense.
BROWN: Let me follow up, because Germany's economic minister says President Trump will -- quote -- "buckle under pressure if Europe hits back."
Given the president's history of making threats and then backing off, why should foreign leaders think he will stand firm this time?
LUTNICK: Donald Trump is going to stand firm because he is reordering global trade.
Make no mistake about it, America has been exploited, and he is done allowing America to be exploited. And no amount of the exploiters trying to swing harder at us after they have exploited us for all these years is going to change Donald Trump's view.
What they can do is, they can stop exploiting us. How about try that? And the arrogance of saying, I have taken advantage of you for decades, and not only saying I understand that you're fixing it, I'm disappointed that the jig is up and I can't take advantage of you anymore, right, and I'm disappointed.
[11:35:07]
Instead, if you're angry and you fight back to the greatest customer in the world, you're going to lose. We are the sumo wrestler of this world. We are the biggest economy, the biggest customer.
BROWN: OK.
LUTNICK: You can't fight back against your customer.
BROWN: Very quickly, the dollar is weakening. Is that part of the strategy here? As you know, some economists say that is what the administration is trying to do here, weaken the dollar.
LUTNICK: Donald Trump called out currency manipulation.
Technically, right, you would think the dollar would rally on this kind of thing. But why is it falling? Because Donald Trump said, stop manipulating your currency.
BROWN: Do you want it to fall? Are you happy if...
(CROSSTALK)
LUTNICK: If the world stops manipulating the currency, right, then the dollar gets cheaper. Our ability to export is better. It's easier.
Our people...
BROWN: So this is part of the strategy?
LUTNICK: Well, stop manipulating, right?
The dollar was just bolstered up by these economies because they were faking it. It's got to stop. We need to be treated fairly. Thank God we have got Donald Trump in the White House. He's finally going to treat America fairly. He's going to finally treat American workers fairly. This is the biggest change you're ever going to see, because you have the right guy in the White House doing the right things, protecting America.
BROWN: So it is true? It's a strategy to weaken the dollar, yes?
LUTNICK: It is not a strategy to weaken the dollar. It's a strategy....
BROWN: But it's part of the plan? It's part of the plan?
LUTNICK: It is not a plan. We don't have a plan about the dollar.
We have a plan about American workers. We have a plan about American factories. And these are all outcomes of stop manipulating your -- stop, you, manipulating our currency. Stop it.
BROWN: OK.
LUTNICK: And if that means the dollar goes back to where it should be because you have stopped manipulating it, I don't -- makes sense to me.
BROWN: All right, Secretary Lutnick, thank you so much for your time.
We will be right back.
LUTNICK: Thanks for being here.
(COMMERCIAL BREAK)
[11:41:02]
BLITZER: Right now, the new Canadian prime minister, Mark Carney, is speaking about President Trump's tariffs.
Listen to what he just said.
(BEGIN VIDEO CLIP)
MARK CARNEY, CANADIAN PRIME MINISTER: So while it's progress that further tariffs were not imposed on Canada yesterday, the president's actions will reverberate here in Canada and across the world.
Three sets, three different sets of U.S. tariffs remain in place and will continue to pose significant threats to Canadian workers and Canadian businesses. And while they have been imposed under different premises, some things are consistent.
They are all unjustified, unwarranted, and, in our judgment, misguided.
(END VIDEO CLIP)
BLITZER: And joining us now, the former Premier of Quebec Jean Charest. He's also the former deputy prime minister of Canada.
Premier, thanks so much for coming in.
JEAN CHAREST, FORMER PREMIER OF QUEBEC, CANADA: Thank you, Wolf.
BLITZER: So what do you -- what's your reaction to what we just heard from your prime minister?
CHAREST: Well, Prime Minister Carney had been very clear, Wolf, that if there were to be tariffs or new tariffs, that Canada would retaliate. I mean, he's always been very, very clear about that.
So, what I understand, he's announcing today what will be a tit for tat on tariffs for autos. And so that was to be expected. The money that will be drawn from those tariffs are going to go to the workers who -- in Canada who will be affected.
And the automotive industry -- our expectation is that the automotive industry throughout all of North America, Mexico will have a very big impact...
(CROSSTALK)
BLITZER: So what U.S. exports to Canada will be affected, will become more expensive?
CHAREST: Well, he's going to announce that today. I didn't see the last list, so I couldn't really tell you what will be in there.
But, of course, like everyone else, we're seeking to -- and, by the way, we -- everyone's aware, we hurt ourselves as we do this. The tariffs hurt us. We do countertariffs, it hurts us also. We're in the world of very bad choices.
And we're looking at products for which there are Canadian substitutes or substitutes from other countries than the United States. So it may be in the agrifood area. But we're going to do everything we can to protect our consumers and...
BLITZER: So American farmers are going to be impacted big time.
CHAREST: Wow, they...
(CROSSTALK)
BLITZER: Because they export a lot of stuff to Canada. But you're saying it's now going to be much more expensive.
CHAREST: And we're one of the biggest clients.
And the relationship with Canadian farmers -- American farmers is that we sell potash, which is absolutely essential to the farming community in the United States in the spring and the fall. And we supply 80 percent of it, Wolf. And there's a -- we don't get it. We don't understand why the administration puts a 10 percent tariff on potash.
That hurts American farmers. I mean, it doesn't make sense to us. Same thing for energy. We're -- we live in a global energy market. We supply 60 percent of all the foreign oil. Gas sold to the United States comes from Canada. And we sell it at a discount relative to the rest of the market. And there's a 10 percent tariff on energy?
You produce 13 million barrels a day. You consume 20 million. We sell about four or five million barrels a day. If the American administration wants lower energy prices, well, why are they putting a tariff on energy?
BLITZER: You just heard the Trump commerce secretary, Howard Lutnick...
CHAREST: Yes.
BLITZER: ... who was just here with us. He told us that President Trump is, in his words, not going to back off these U.S. -- these latest U.S. tariffs.
What do you make of what we heard from the secretary? And what do you see as the path forward right now for Canada and the U.S.?
CHAREST: In the case of Canada, the U.S. and Mexico, what we thought was encouraging news yesterday is that the USMCA, the trade agreement that we have that President Trump signed in 2018, is maintained.
And, for us, that's significant because it means that we can give a framework to the economic relationship and avoid what we have been experiencing since the election, day-to-day announcements about tariffs that may or may not happen.
[11:45:04]
By the way, microchips, pharmaceutical products are now on the docket and to come. So the maintenance of the USMCA is a major move for us. It's very important. It's good news. It means -- and we will negotiate in good faith, and recognizing that all -- both countries have greatly benefited from our trade relationship, actually.
And we live in a world, by the way -- let's take autos. We live in a world where no single product is made in one country. It doesn't exist anymore, whether it's autos or any other product. I mean, that world is gone.
So, in the automotive industry, parts can go back and forth between the border five or six times before they're finally assembled in an auto plant. It's so true, Wolf, that I think it was -- we calculated probably 50 percent of what we export to the United States and Canada comes from the United States. Why would you tariff that?
BLITZER: We're seeing markets not only here in the United States, but around the world, I assume in Canada as well, fall right now in the wake of these latest Trump tariff announcements.
CHAREST: Yes.
BLITZER: How concerned are you that potentially, God forbid, we could all be facing not just a domestic recession, but a global recession?
CHAREST: Well, and when you strip away all the rhetoric and the speeches around all of this, we cannot defy the laws of gravity too long. And it's pretty simple, increase costs, increase inflation, increase
interest rates, and you're going to get a slowdown in the economy. And we are concerned that there will be a recession. We believe the probability of that is very high, and not only in the United States, but in the world. If the United States go into a recession, so will Canada.
And so, in that respect, sadly -- and all of this was unnecessary. We didn't have to go there. And the view of Canadians, we have a lot of respect for President Trump. He's elected. He's the president. He has an agenda. We want to work with him.
And one of the challenges is, he has a growth agenda, reducing taxes, deregulating, reducing the size of government. And the tariffs are a direct contradiction to his growth agenda. It doesn't work. And so we want to work with the Americans and our friends and allies to make the right choices. And, hopefully, that will happen in the next few months.
BLITZER: All right, as you probably know, Canadians are canceling a lot of their travel plans to the United States.
CHAREST: Yes.
BLITZER: They're ditching American-made products and actually -- and this was pretty shocking to me -- booing the American national anthem at various sporting events, especially hockey games.
Are we looking at a permanent change in the relationship, the longstanding, wonderful relationship, between the United States and Canada?
CHAREST: Canadians are very -- we are very lucky, American and Canadians, to be born in this neighborhood of the world. We're -- our friend -- American neighbors are friends, they're allies, and we appreciate them.
And we differentiate between political leaders and who are our neighbors. And one of our challenges as we move ahead both on the American side and our side is to differentiate between the leaders and the people, for whom there is just a fantastic relationship. And that will continue.
So Canadians do -- by the way, they did feel, I think, hurt on these certain comments that were made. And they felt destabilized by these comments. And that's why they're reacting the way they do. But, at the end of the day, is there a better place in the world to live actually than in Canada, between the United States and Canada?
I don't think so, Wolf. That's the way we see it.
BLITZER: Yes, it was so awful. You heard when they were booing the American national anthem.
CHAREST: And...
BLITZER: For someone who grew up on the border with Canada in Buffalo, I couldn't believe something like that...
(CROSSTALK)
CHAREST: And that is not right. And our political leaders are -- denounced that.
And, by the way, before the game starts, they try to tell the crowd, please be respectful of the anthem of the other country, as we always should be, no matter who it is. And these things happen, and they are a reaction to what's happening. And that's not an excuse, Wolf.
BLITZER: Yes.
CHAREST: It just should not happen.
BLITZER: I hope it doesn't happen, because I know that, in Buffalo, when the Buffalo Sabres play hockey, they always play not just the U.S. national anthem...
CHAREST: Yes.
BLITZER: ... but they also play "O Canada."
CHAREST: Yes.
BLITZER: And it's always very respectful.
(LAUGHTER)
BLITZER: So many of the players, of course, hockey players, are from Canada, and it's the right thing to do.
CHAREST: And they're Canadians. And we like to go to Buffalo and win.
(LAUGHTER)
BLITZER: We like to see -- we like to win in Buffalo as well.
Jean Charest, thanks so much for coming in, the former premier of Quebec. Appreciate it.
CHAREST: Thank you, Wolf.
BLITZER: And coming up, we're talking with a Democratic senator who just introduced new legislation aimed at reasserting the role Congress plays in our country's trade.
We will be right back.
(COMMERCIAL BREAK)
[11:52:48]
BROWN: We're following breaking news on the fallout over President Trump's historic new global tariffs.
Canadian Prime Minister Mark Carney just announced his country's response to President Trump's tariffs.
(BEGIN VIDEO CLIP)
CARNEY: And, today, I'm announcing that the government of Canada will be responding by matching the U.S. approach, by matching the U.S. approach with 25 percent tariffs on all vehicles imported from the United States that are not compliant with CUSMA, our North American free trade agreement, and on the non-Canadian content of CUSMA- compliant vehicles from the United States as well.
Our tariffs though, unlike the U.S. tariffs, will not affect auto parts, because we know the benefits of our integrated production system. And they will also not affect vehicle content from Mexico, who is respecting the CUSMA agreement.
And -- and, as well, we are developing a framework for auto producers in Canada to get relief from these countertariffs as long as they maintain their production and investment in our country.
(END VIDEO CLIP)
BLITZER: And joining us now, Senator Maria Cantwell of Washington state. She's the top Democrat on the Commerce, Science and Transportation Committee.
Today, Senator, you and Republican Senator Chuck Grassley actually introduced the bill to reassert congressional authority over U.S. trade policies. How would this bill achieve that? And do you think there's enough support for this legislation to pass both the Senate and the House?
SEN. MARIA CANTWELL (D-WA): Well, Wolf, we thought it was critical that we get this discussion going, the fact that Congress' duty and responsibility is not just interstate commerce, but foreign commerce.
And Senator Grassley, as a former chairman of the Finance Committee, has played a key role in making sure that we continue to play this role. So we're saying that, yes, Congress should review these issues, that it is time, that in the past we may have directed a president to negotiate trade agreements, but this is time now, because of the lack of rules-based approach to this, that Congress should review this.
[11:55:02]
BLITZER: What are you hearing, Senator, from your constituents about these latest Trump-imposed tariffs? How concerned are your constituents that prices for all sorts of products will rise?
CANTWELL: Well, Wolf, I represent one of the most trade-dependent states in the nation.
And when you think about the state of Washington, you think about aviation, airplane exports, you think about Microsoft and technology exports, you think about a big agriculture state with apples and cherries and wheat. Wheat, 90 percent of it is exported. So, it's -- and we have lots of ports where we move everybody else's
products to overseas markets. So we want to increase exports, and we do that by opening up world markets. And so we want trade, not tariffs.
BLITZER: Many foreign leaders, as you know, across the world right now, they are vowing to retaliate against the United States. So what could that mean if this global trade war escalates even more dramatically?
CANTWELL: Well, I think I just heard on the break there the premier of Canada saying he is retaliating. I think that's what I heard.
And so that is the point about tariffs. Why? They should -- in my opinion, we should be building alliances. What tariffs mean is, you're in the start of a trade dispute that could last years. In fact, we had one in our state on polysilicon that lasted over 10 years, and then still didn't result in any progress.
So all that the tariff means is that you are in a dispute, the retaliation makes it worse, and then the consumer pays the price. We should be building alliances to open up markets, and the United States should continue with capitalism. Your guests that were just on were outlining why this is so critical.
The world has changed. Even since the last Trump administration, supply chains are more integrated, and they are more interdependent, but we're driving down the cost of production. And so now, all of a sudden, if you throw a wrench in that, it hurts everybody, but particularly businesses and consumers.
BLITZER: Our CNN politics senior reporter, Stephen Collinson, writes this.
And I'm quoting him now from his article on CNN.com -- quote -- "Trump's two terms are proof that the benefits of globalization are not universally shared. Many of the swing states Trump won in 2016 and 2024 are scarred by industrial decline. Voters there remember promises made to them by previous presidents and think they were lied to" -- end quote.
Senator, factory workers and the working class were once the heart of your party, the Democratic Party. What do you say to these Americans who are desperate for those jobs to return to the United States?
CANTWELL: Well, that's why we fought so hard for the CHIPS and Science ACT and was so proud that we had Intel committing to a factory in Ohio. That was massive.
It's saying that the high-tech economy can come to a community by you. And you have to grow and skill the work force. So we want to -- besides opening up markets, want to make a major investment in upskilling the work force of the United States to take advantage.
But with those bills, the Innovation Act that we did, you saw lots of supply chains on battery technology, next-generation technology, on semiconductors all moving to the United States. People were saying, if you want to innovate, go to the United States, and they will drive down the costs.
But this just threw a wrench into that.
BLITZER: We're seeing more warning signs right now that the tariffs just announced by President Trump threaten to plunge the U.S. and various global economies into recession.
Is that where we are all headed?
CANTWELL: Well, I hope not. I hope that my colleagues will join us today in saying, let's have a debate about this.
I actually think it's a good thing to show that Congress is going to reinsert itself. But the point here is, the reason why you have a trade regime is to have rules, to have a rules-based discussion. That's so important when you're negotiating a trade agreement.
When you go the tariff route, you are just throwing down and basically causing the economic disruption. So let's go back to what we in the United States want. We want access to a larger market. But we're also supposed to be the leaders of capitalism.
We're trying to say that capitalism and capital markets now -- some other day, you will have me on and I will talk about the things you need to do to rein in capitalism. But, in general, we want more capital formation, more capital markets. We want exports.
And when we, the United States, lead that charge, we bring other countries along with those rules-based regimes. And that's what we should be advocating at a time when it's important to have more alliances, not less. If you want to counter China, build some alliances with some other high-tech countries around the world and then lay that down.
BLITZER: Senator Maria Cantwell of Washington state, thanks so much for joining us.
CANTWELL: Thank you.
