Front Burner - Canada vs the ‘most hated guy on Wall Street’

Episode Date: March 12, 2025

By the end of Tuesday, day eight of the Canada-U.S. trade war, Ontario Premier Doug Ford had backed down on a 25 per cent surcharge on electricity going to the U.S. that was supposed to go into effect that day. It came after a "productive conversation" between Ford and U.S. commerce secretary Howard Lutnick, who agreed to meet Ford on Thursday. Lutnick has been making the rounds on U.S. cable networks selling Trump's tariffs and ripping into Canada's response. He was also on the call last week between Prime Minister Trudeau and Trump, and has been in constant communication with Finance Minister Dominic Leblanc.So, who is Howard Lutnick? What kind of negotiator is he? What does he believe?Dan Alexander is a senior editor at Forbes Magazine. He recently wrote a profile on Lutnick titled "The most hated guy on Wall Street: the unspoken story around Howard Lutnick, Trump's pick for commerce secretary".

How are Canadians bracing for a full-on trade war? Without U.S. buy-in, can Canada really help Ukraine? And is Canadian patriotism messing with conservative strategy? We explore questions like these on Power and Politics, CBC's only political daily. I'm David Cochran. I speak to the key players in the political stories everyone is talking about. You'll hear from those who've got the power, those who want it, and those affected most by it. You can find Power in Politics wherever you get your podcasts, including YouTube.

Hey everybody, I'm Jamie Poisson and just a quick message before we start today. First off, thank you so much for all your really excellent, smart questions that you sent in. We got pages of them and we've read and listened to them all. We have found it really motivating and cool and frankly touching to hear from all of you. So again, thank you. We're putting together the episode now, so we're not going to take any more questions, but please do stay tuned this week. We are going to run it. Okay, here is today's show. By the end of the day Tuesday, day eight of the trade war, Ontario premier Doug Ford had backed down on a 25% tariff on electricity going into the U.S US that was supposed to go into effect that day.

The retreat came after a quote productive conversation between Ford and US commerce secretary Howard Lutnick. Ford and Lutnick agreed to meet on Thursday. So Ford is now going to Washington to meet this really key and very compelling, also controversial character in these negotiations. It is Lutnick who has been making the rounds on U.S. cable networks selling Trump's tariffs and ripping into Canada's response. I mean, think about it. Why would a factory that was making cars in Michigan

move to Canada? We harmed American workers. In exchange for what? Donald Trump understands it he's going to bring it back. So I love when Trudeau who's about to leave the government and obviously he should leave the government with his kind of talking hopefully they'll elect someone who's clever who comes down and says to Donald Trump we want to do business with you we want to do business fairly and we get rid of all this

nonsense. They got a digital tax in. They try to tax our tech companies. What happened to USMCA? I'll tell you what happened to it. The Canadians like to cheat. It's Lutnick who was on the call last week with Trudeau and Trump. Ford, as we mentioned, has been talking to Lutnick, but so has Finance Minister Dominic LeBlanc. He says he's been talking to Lutnick a lot,

including late-night texts. He strikes me as somebody who's a very successful New York business person who's known President Trump for 30 years. They're clearly friends and he has a function as the Commerce Secretary that's essential to try and iron out some of this trade chaos. So who is Howard Letnick? What kind of negotiator is he? What does he believe? Dan Alexander is a senior editor at Forbes magazine. He recently wrote a profile on Letnick titled, The Most Hated Guy on Wall Street, the unspoken story

around Howard Letnick, Trump's pick for Commerce Secretary. Dan, hi. Thank you so much for coming on to Frontburner. Sure thing. Thank you for having me. So today, as I mentioned in the intro, we're going to try to understand this guy who is very much at the center of this trade war that we are currently in with the United States. And why don't we start at the very beginning, hey, where is Letnik from? Can you tell me a bit about his life growing up? Yeah, he grew up on Long Island, had a close family,

but a family that had a lot of hardships early on. His mom got sick when he was young and she ended up passing away when he was just 16 years old. As he was going to college, his dad became sick also and his dad kept it a secret that he was sick from the family and he went in to go have some medical work done. And as Lutnick tells the story, one of the nurses messed up a dosage and he died right then. So Lutnick was 18 years old. He is the middle child of three,

an older sister and then a younger brother. So the three of them sort of figure out how to navigate life together. And what ultimately transpires is that, you know, they end up super close to each other. Lutnick ends up at the center of this multi-billion dollar business empire, brings his siblings along with him. And they continue to face both immense success and unspeakable tragedy throughout their lives. And just tell me how that came to be that he found himself at the center of this empire. He gets a job on Wall Street with a guy named Bernie Cantor.

And Bernie Cantor ran a firm called Cantor Fitzgerald, which was sort of, you know, if Wall Street had a blue collar-ish firm, this would be it. I mean, not regarded as highly as many of the other firms, but sort of a street fighter firm. A firm that was looking for an edge. And Bernie Cantor was very successful himself and he had developed really a central business around brokering treasuries, which is a massive, massive market.

I mean, obviously, tons of people are buying and selling US treasuries. And in order to do that brokerage, you take a tiny, tiny slice of those transactions as a fee. And that was really where Bernie Cantor kind of made his bones and established his firm finally. And that became kind of the heart of the business.

So that's what what Lutnick walks into. And you know, he's a young kid who has a lot of ambition and has been through a lot of hard things and he figures out basically this guy Bernie Cantor is the guy that I need to impress and he works really really hard uh to impress Bernie Cantor and essentially becomes like you know his little golden child um and he'll do anything for Bernie Cantor. And Bernie Cantor asks a lot of him, including, you know, managing amounts of money

that you wouldn't expect, you know, a kid in their early 20s to be able to manage. And Lutnik has some success. And so Bernie Cantor continues to give him opportunities. And when Lutnik is very young, you know, Ernie Cantor is getting much older and starting to step out of the firm. And he essentially says, hey, I want you running the show. And so at that point, Lutnick begins managing the company and then he ultimately purchases a large chunk of the

partnership and in a very contentious way after Bernie Cantor gets super sick, sort of pushes Bernie Cantor's family out of the business, consolidates control. And when he's not even 40 years old, he's all of a sudden running this Wall Street firm and he controls it. And although he doesn't own the majority of it, he owns a lot of it. And it's through that firm and through growing that firm

that he ultimately became a billionaire. Am I right to say that things got so acrimonious between Letnik and the family of Bernie Cantor that the wife barred him from like visiting his grave? That's right. So Iris Cantor, who's Bernie Cantor's wife, she was trying to hold on to, you know, her share of the business. Now, there's a lot of arguing about what exactly transpired. In her telling, she wanted to have a bigger say. In his telling, Bernie had essentially handed over the reins of the firm to him and then Iris was trying to take

it back. Lots of litigation, massive settlement. And at the end of the day, Iris walks away with a lot of money. Lutnick walks away with a super valuable company. And the two parties have a lot of distrust of each other. And certainly it sort of is the beginning of what becomes kind of a quiet reputation on Wall Street of, you know, this guy is a brawler. He is willing to fight and people who are on the other side of him and even people on his own team might not like it. I want to talk about 9-11 with you now. You mentioned a life marked with additional tragedies.

Some people listening might actually remember Howard Letnick from the days and years after 9-11 because the Cantor Fitzgerald offices were tragically on the 101st to 105th floors of Tower One at the World Trade Center. And I believe that three out of every four people who worked for the firm were killed on 9-11, a total of 658 people, including Letnik's younger brother. And so how does he talk about that unimaginable tragedy? How do you think that it shaped him? Yeah, well, he does talk about it. He talks about it a lot.

It sort of is the central moment in his life, the defining moment. My brother was on the 103rd floor. central moment in his life, the defining moment. My brother was on the 103rd floor. He worked for me and he worked at Canter. And he called my sister just after the plane hit. And he told her that, he said that the smoke was pouring in. He was stuck in a corner office.

There was no way out. And the smoke was coming in and he's not good and things are not good and he's not going to make it. And he just wanted to say that he loved her and he wanted to say goodbye and tell everyone that he loved them. And then the phone went dead. So while I'm the head of the company, I'm trying to help my 700 employees who are missing their loved ones. I'm just another one of them. This is another one of them.

And he was taking his son to his first day of kindergarten. And so he showed up a little bit late to work that morning. And most of the employees were already there. He showed up a little bit late to work that morning. Most of the employees were already there. As you say, because they were on the top floors, they'll die. One of the things that made this so hard for Lutnik, and if you watch him talk about it, we're close to 25 years after it happened and he can't get through it without crying. One of the things that was so hard is that once he consolidates control of the firm,

his philosophy was, I'm going to go out and hire all my friends and all the people close to me, including his brother. And then I'm going to tell them to go hire all their friends. And what is going to happen is we're going to have this super tight knit network of co-workers who are all running this firm. So when you have that sort of company culture and that basis for hiring and then you have everybody die. It's hard to put yourself in his shoes and how devastating that must have been. He was downtown when the tower collapsed and he hid under a car and thought he himself had died.

So here you've got this young guy, maybe he's around 40, and he's got this enormous responsibility as the head of this firm, and yet he's dealing with this huge personal tragedy. And you could see different people reacting in a lot of different ways in that moment. And the way that he decides to react is to say, I got to get everybody back working and we've got to save this company.

And what we're going to do is to make this our mission is we're going to give back. He describes it various ways at different times. Sometimes it says 25% of the profit, sometimes it says 25% of the salaries. It's a partnership, so it's easy to sort of consider those the same thing. But of the profits are going back to the families of those who died that day. And so over the next five years, they did that and they ended up contributing $180 million to the families of their colleagues, family members, friends who had died on 9-11.

["Sweet Home"] Yeah, and just building back that business after losing 658 people, like how did he do that? Well, one of the ways that he did it was that he very smartly. So remember, this was a brokerage business and we're talking about 2001. So you know, step back for a second and technology is sweeping the world. And Lutnik in the mid-90s had decided, okay, in addition to this human brokerage business that we have, we're also going to start an electronic brokerage business to help people buy and sell treasuries and other types of assets. So that really became something

that helped save them. The other thing that really helped them was sympathy. I mean, Lutnik sort of becomes the face of business people fighting back from this tragedy that America has experienced. And in the same way that Rudy Giuliani becomes such a massive figure in the wake of 9-11, Howard Lutnick does too. He's this Wall Street tough dude from New York who is saying, yeah, we lost hundreds of people and we're still not given up and we're going to fight back. And so what happens is a lot of firms that need to sort of buy or sell Treasuries, they say, you know what, let's give our business to this guy. The headline of your piece, the most hated guy on Wall Street, I think that quote comes

from a former partner, right? So just tell me more about how he gets that moniker. So one of the things that's difficult about explaining or talking about Howard Lundnick is that, you know, he has this amazing story. And he's built this huge business. It's easy to root for a guy like that. But despite all of that, you talk to people who used to work for him and many of them really, really hate him. It's not just people who used to work for him. It's also people at other firms too. It's also people at other firms too. And the thing is the reason why it's an unspoken story is because given all he's been through, he's kind of a hard guy to criticize, but the way that he conducts his business, which is with firm control, always looking for an advantage,

firm control, always looking for an advantage, not above sending people to the door in pretty dramatic fashion, according to many of the people who used to work for him, essentially taking their partnership interests once they leave. These are things that create this reputation of this guy, yeah, he's a fighter, but man, is he nasty. I've written stories about several people on Wall Street, but I've never had an experience like this where once you start connecting with the people who work for him, the hatred is so intense and so obvious so quickly. Wow, that's a really interesting anecdote. I'm Nicola Coughlin, this is history's youngest heroes, Terry Fox's Marathon of Hope. I think of home a lot.

I think of running into Vancouver and running into where I'm going to finish on the ocean and all you got to do is take another step and keep on going. He planned to run 5,300 miles across the second largest country in the world. Makes you believe in the human race again. Join me, Nicola Coughlin, for history's youngest heroes, wherever you get your podcasts. How did it come to be that he was chosen by Trump as co-chair of his transition team. Do they have a history together or? Yeah, they've known each other for a while.

You know, they sort of came of age a little bit at the same time. Trump was a little bit earlier, you know, Trump's sort of early 1980s, but you know, as Trump is really kind of, you know, big developer doing his stuff in Atlantic City, buying big buildings But you know, as Trump is really kind of, you know, big developer doing his stuff in Atlantic City, buying big buildings, you know, Lutnick is taking over this firm, and they're both kind of a little bit of insider outsiders. These

are not the kind of people who, as somebody described it to me, I think was a former employee, although my mind, my memory might be fuzzy on who said it. but he said, these aren't the kind of guys that the Wall Street crowd wants at their country club, but they are really rich and they are big significant businessmen. After Trump incites the riot on January 6th, a lot of Wall Street, a lot of the business world is immediately like, oh gosh, I don't want anything to do with this guy anymore. In fact, many of his cabinet members resigned, you know, it was a really isolating moment for Donald Trump. But Howard Ludnick didn't run away. Howard Ludnick in those early days was in fact,

one of the people who was trying to figure out how Trump could come back in a business sense. How he could, Lutnick was looking at financing what ultimately becomes Truth Social and the Trump Media and Technology Group. And that was a move that I don't think, well, I know that a lot of people would not have done. And particularly the quote unquote, Clencher Club set, you know, but Lutnick, you know, he was willing to do it. And my sense is that by staying close to Trump in those tough moments, it was easier for Lutnick to be close to him when everybody else eventually got

on board. Right. And then he becomes head of the transition team and ultimately a member of the cabinet. So he becomes commerce secretary and he's charged really with selling these tariffs and knowing his history, does it surprise you to hear him be such a proponent of putting crippling tariffs on a place like Canada? Do you think he's a true believer in the policies or? Well, let me start with this.

Howard Lutnick is a super smart guy. Okay. There's, Lutnick understands the nuances of this stuff. He knows the potential effects. But one of the ways in which he is savvy is that he also knows who his boss is. And Donald Trump doesn't have very many policy positions that are deeply rooted, you know, that he really truly cares about to his core. But one of them is foreign trade. And by the way,

Lutnick is also a good storyteller. He's well spoken. He's good on television. It wasn't just that he had a good story after 9-11. It was also that he told his story in a compelling way. So look, does Howard Lutnick believe all of these things that Donald Trump believes about foreign trade? Hard to know whether his economic analysis would put him in that same boat or not, but he certainly believes that that's what he needs to do as now an employee for Donald Trump. And he'll sell that case aggressively. And, you know, depending on who you talk to persuasively. I know we've talked about how people think he's tough and even nasty, but I just wonder

like when you think about him as a negotiator, what other words might come to mind? Well, all right, let me tell you a story because I think that sometimes that's the best way to get inside how people think about this stuff. One of the things that has been most difficult for former colleagues of Lutnick, they say that when they leave that he takes their partnership interests. The trick is that Lutnick draws up an agreement

that people sign upon joining the partnership that one of the former employees told me it was like 700 pages long. Okay. Nobody understands the thing. Nobody knows what's in it except for Howard Ludnick. And he knows that it has extraordinarily difficult anti-compete provisions in it. And so when people leave his firm, if they go to do virtually anything in the financial services sector, because Cantor touches so much of the world of finance, he will be able to accuse them of breaking these agreements and therefore can take their partnership agreements

or their partnership pictures. And that sort of mentality of it's not just like puffing out your chest and saying I'm a tough guy, but it's getting into the nitty gritty details and doing so in a way that ultimately works to your advantage. That's how he negotiates. Unlike Trump, who's much more sort of broad strokes, you know, I don't like tariffs, whatever, Letnik might say that stuff on television. He might say, hey, I believe that we should just, even during this confirmation hearing, that we should just tax a flat tariff on countries, not try to be too specific about it. My way of thinking, and I discussed this with the president, is country by country, macro. Let America make it more fair. We are treated horribly

by the global trading environment. They all have higher tariffs, non-tariff trade barriers, and subsidies. They treat us poorly. We need to be treated better, we need to be treated with respect, and we can use tariffs to create reciprocity, fairness, and respect. Don't be fully fooled by that. I mean, this is a guy who definitely knows the differences between how Canada is going to respond or any other country is going to respond if they're, when you're talking about tariffs on dairy versus lumber versus automobile components, all of those nuances, I have no doubt that Howard Lutnick understands to the core. So given that, and just as a final question for you, I wonder what advice you might have

as somebody who has spent so much time thinking about this guy or even, you know, the people in his orbit, what advice you might have to someone sitting across the other side of the table negotiating with him? Well, I think that with Trump, a lot of times, and this extends into Lutnik too, a lot of times the personality part of it does play a big role and the showmanship of it plays a big role. Trump is not, he doesn't lose publicly in his own mind ever on anything. So, if somebody has an advantage over him, the play is not necessarily to tout the advantage publicly because he will lose, he does lose, he settles lawsuits, you know, he backs down from things, but when it becomes

publicly very acrimonious, then he gets more determined to position himself as the winner. So in other words, one of the best ways to win against Trump is to win privately, not publicly. Dear, this is fantastic. Thank you so much. Yeah, sure. Happy to help. to help. Jamie Pauzon Alright, that is all for today. I'm Jamie Pauzon. Thanks so much for listening. Talk to you tomorrow. For more CBC podcasts, go to cbc.ca slash podcasts.