Over the decades Goldman Sachs had not done business with the Trump Organization or Trump himself, knowing that he might stiff anyone and everyone. He would just not pay, or sue. Early in Cohn’s time at Goldman there had been a junior salesperson who did a bond trade for a casino with Trump.
Cohn told the young trader that if the trade didn’t settle, he would be fired. Fortunately for the trader, Trump did pay.
Applying this mind-set from his real estate days to governing and deciding to risk bankrupting the United States would be a different matter entirely.
* * *
In another discussion with the president, Cohn unveiled a Commerce Department study showing the U.S. absolutely needed to trade with China. “If you’re the Chinese and you want to really just destroy us, just stop sending us antibiotics. You know we don’t really produce antibiotics in the United States?” The study also showed that nine major antibiotics were not produced in the United States, including penicillin. China sold 96.6 percent of all antibiotics used here. “We don’t produce penicillin.”
Trump looked at Cohn strangely.
“Sir, so when mothers’ babies are dying of strep throat, what are you going to say to them?” Cohn asked Trump if he would tell them, “Trade deficits matter”?
“We’ll buy it from another country,” Trump proposed.
“So now the Chinese are going to sell it [antibiotics] to the Germans, and the Germans are going to mark it up and sell it to us. So our trade deficit will go down with the Chinese, up with the Germans.” U.S. consumers would be paying a markup. “Is that good for our economy?” Navarro said they would buy it through some country other than Germany.
Same problem, Cohn said. “You’re just rearranging deck chairs on the Titanic.”
* * *
The U.S. automobile industry was another Trump obsession. China was hurting the industry dramatically and U.S. workers even more, he alleged.
Cohn assembled the best statistics that could be compiled. Trump would not read, so Cohn brought charts to the Oval Office. The numbers showed that the American auto industry was fine. One big chart showed Detroit’s Big Three were producing 3.6 million fewer cars and light trucks since 1994, but the rest of the U.S., mostly in the Southeast, was up the same 3.6 million.
The entire BMW 3 series in the world were made in South Carolina, Cohn said. The Mercedes SUVs were all made in the United States. The millions of auto jobs lost in Detroit had moved to South Carolina and North Carolina because of right-to-work laws.
What about the empty factories? Trump asked. “We’ve got to fix this.”
Cohn had put another document, “U.S. Record in WTO Disputes,” in the daily book that Porter compiled for the president at night. But Trump rarely if ever cracked it open.
“The World Trade Organization is the worst organization ever created!” Trump said. “We lose more cases than anything.”
“This is in your book, sir,” Cohn said, and brought out another copy. The document showed that the United States won 85.7 percent of its WTO cases, more than average. “The United States has won trade disputes against China on unfair extra duties on U.S. poultry, steel and autos, as well as unfair export restraints on raw materials and rare earth minerals. The United States has also used the dispute settlements system to force China to drop subsidies in numerous sectors.”
“This is bullshit,” Trump replied. “This is wrong.”
“This is not wrong. This is data from the United States trade representative. Call Lighthizer and see if he agrees.”
“I’m not calling Lighthizer,” Trump said.
“Well,” Cohn said, “I’ll call Lighthizer. This is the factual data. There’s no one that’s going to disagree with this data.” Then he added, “Data is data.”
* * *
Cohn occasionally sought Vice President Pence’s help, always in private conversations. He made his case on steel and aluminum tariffs. “Mike, I need your help on this.”
“You’re doing the right thing,” Pence said. “I’m just not sure what I can do.”
“Mike, there’s no state going to be hurt worse than Indiana on steel and aluminum tariffs. Elkhart, Indiana, is the boat and RV capital of the world. What goes into boats and RVs? Aluminum and steel. Your state is going to get killed on this.”
“Yeah, I got it.”
“Can you help me?”
“Doing everything I can.”
As usual, Pence was staying out of the way. He didn’t want to be tweeted about or called an idiot. If he were advising Pence, Cohn would have had him do exactly that—stay out of it.
* * *
Kelly concluded that Peter Navarro was the problem. Navarro would get into the Oval Office and spin Trump up on the trade deficits. Since he was preaching to the converted, Trump would soon be in full activist mode, declaring, I will sign today.
Cohn took every chance he could get to tell Kelly how Navarro was an absolute disaster. Get rid of him, Cohn argued, fire him. This place is never going to work as long as he is around.
Kelly asked Porter for his opinion. “The current status quo is unsustainable,” Porter said. “I don’t think you can get rid of Peter, because the president loves him. He’d never allow for that.” You can’t promote Navarro, like he wants, because that would be absurd. “Peter needs to be responsible to someone, other than feeling like he’s got a direct report to the president. A lot of times I’m able to block him.”
Kelly decided he was going to assert control, and called a meeting of the combatants for September 26. It was like a duel. Navarro was allowed to bring in a second and he chose Stephen Miller. Cohn brought Porter.
Navarro started off arguing that during the campaign he was promised to be an assistant to the president. Now he was only a deputy assistant. This is a betrayal. He said he couldn’t believe it had lasted this long. He had talked to the president, who did not really know the difference between an assistant to the president and a deputy assistant. The president thought special assistant sounded a lot better, not realizing it was an even lower position.
Navarro said that the president had told him he could have whatever title and reporting structure he wanted. He and his Trade Council represented the American worker, the manufacturing base, the forgotten man.
“Peter’s out there going rogue,” Cohn responded. “He’s creating these problems. He’s telling the president lies. He’s totally unchecked. He’s the source of all the chaos in this building.”
“Gary doesn’t know what he is talking about,” Navarro replied. “Gary’s just a globalist. He’s not loyal to the president.” And Porter was always fiddling with the process and manipulating to delay everything so Navarro couldn’t get in to see the president.
“All right,” Kelly said. “I can’t deal with this anymore. Peter, you’re going to be a member of the National Economic Council, and you’re going to report to Gary. And that’s just how it’s going to be. And if you don’t like it, you can quit. Meeting over.”
“I want to appeal this,” Navarro said. “I want to talk to the president.”
“You’re not talking to the president,” Kelly said. “Get out of my office.”
Months went by. “Where the hell is my Peter?” the president asked one day. “I haven’t talked to Peter Navarro in two months.” But, as was often the case, he did not follow up.
CHAPTER
34
Trump’s face-off with Kim Jong Un was growing increasingly personal.
On Air Force One when tensions were ramping up, Trump said, in a rare moment of reflection, “This guy’s crazy. I really hope this doesn’t end up going to a bad place.”