Admitting that Trump administration tariffs will be beneficial to some companies and harmful to others, a former U.S. secretary of state believes their costs generally will fall onto U.S. businesses and individual taxpayers.
Interviewed by former Utah Gov. Gary Herbert at the recent Crossroads of the World International Trade Summit, Mike Pompeo, secretary of state from 2018 to 2021 and director of the CIA from 2017 to 2018, acknowledged the public’s concerns about tariffs.
“I think, net-net, the global set of tariffs reduces the benefit to the people of Utah. I think having big, huge, broad tariffs just increases costs,” Pompeo said at the event, hosted by Zions Bank and World Trade Center Utah and taking place at the Zions Bancorporation Technology Center in Midvale.
President Trump is a firm believer in the positive impacts of tariffs, and Pompeo believes that will not change, despite economic harm resulting from missteps in their rollout.
“He also recognizes that it’s absolutely an imperative that when we rebalance this, we don’t crush things,” Pompeo said. “And he may have gotten it wrong in the front end, or at least he was coming out of the gate with the most aggressive posture.”
But Pompeo expressed a need for fair trade among nations rather than shielding the U.S. from international commerce.
“We should be very careful about trying to do that. You can’t, in today’s environment, isolate the American economy from the world’s economy. It’s neither wise nor possible,” he said.
While the U.S. has been treated poorly under some trade rules, especially Chinese ones, the reality is that the global economy is “deeply interconnected,” he said. And that creates enormous value for the U.S. economy. “We’re not,” Pompeo said, “going to make everything here.”
The Trump administration has been hampered by inconsistent statements about tariff objectives, from preventing the spread of fentanyl to the desire for trade balance and addressing bilateral trade deficits.
Pompeo said he favors an approach that instead focuses on trade issues with adversaries — China, Russia and Iran — while befriending trade partners. “Those [partners] are folks who add enormous value and build wealth for America, and we should be very careful to anger them and we should make sure they’re not treating us poorly, too,” he said.
China, especially, should be a target.
“That’s the place to focus our attention,” he said. “There is only one nation in the world that can change the way that you and your grandchildren live, and that’s the Chinese Communist Party. … This is the challenge of our time and for this next generation, and I hope President Trump will wisely, smartly focus on making sure that we deliver against a very capable adversary who really does want to undermine our way of life here in the United States.”
Providing wisdom to Utah companies involved in international trade, Pompeo suggested that they should “be mindful” when building their business on a global scale. If they have assets in China, those companies should realize they’re “just a squatter,” he said. “You own that asset only until Xi Jinping decides you don’t own it anymore,” adding that China is “a lawless place led by a dictator with total control.”
Still, Pompeo said he believes that upcoming changes in trade rules will deliver the right outcomes for the U.S. “But this tariff issue is going to remain, for the remainder of his time [as president], for sure,” he said.
Tariffs and trade wars potentially jeopardize Utah’s import-export activities. Last year, the state exported $18.2 billion in goods to the world and imported $21.9 billion from 154 countries, according to a report from the Kem C. Gardner Policy Institute. International trade contributed nearly $8 billion to the state’s gross domestic product and supports more than 70,000 jobs in the state.
Pompeo said an “America First” approach was never intended to be “America Alone” and that it can deliver beneficial, tangible outcomes for the U.S. Other nations “get a little fussy” about “America First” but they likewise are working to benefit their own people, he said.
“It’s even more important … for us because we are truly exceptional,” Pompeo said. “The whole world depends on the success of the United States of America. Without America, without us leading, without a good economy, without the innovation of America, the world is adrift. It is lost. It will be returned to the animal kingdom.”
During trade trips, other nations’ leaders would not admit it in public, but they wanted the U.S. to be strong, he added.
“They wanted us to be successful, because if we were successful, they could build off that,” he said. “They could build their economies off of that, they could build their militaries off of that, they could build their intelligence collection capabilities. If America walks away from that, there’s no second fiddle. There’s nobody who’s going to fill that role that cares about human rights, that cares about private property, that cares about basic rule of law. As a power, there’s just us.”
Pompeo urged Americans to boost the “core set of skills” among young people, especially math and technology and their work ethic.
He acknowledged that elections will result in good presidents and bad presidents, good governors and bad governors. But he urged audience members to “focus on the things that you can impact.” Among examples he cited are buying balls and bats for Little League teams, contributing to a police fund’s charity, cooking a chili dinner at church, helping an elderly person who needs a meal, attending PTA meetings, and building families and faith communities.
“These,” he said, “are the things that build America and provide a fortress against bad governors, bad presidents, and congressmen who screwed things up.”
More than 1,000 people attended the two-day conference in Midvale and Salt Lake City, hearing keynote presentations and panel discussions involving prominent government and business leaders.
“We’re meeting at an unusually interesting and even pivotal moment in the history of our country and its relationships, its standing with the rest of the world,” Harris Simmons, chairman and CEO of Zions Bancorporation, said to kick off the event. “Whatever one thinks of the policies and initiatives of the new administration, I think that we would all agree that it’s been an incredibly energetic and consequential first hundred days of the new Trump presidency.”