Judging Freedom - Prof. Jeffrey Sachs: A Lonely Netanyahu in DC.

Episode Date: February 3, 2025

Prof. Jeffrey Sachs: A Lonely Netanyahu in DC.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Thank you. Hi, everyone. Judge Andrew Napolitano here for Judging Freedom. Today is Monday, February 3rd, 2025. Professor Jeffrey Sachs will be here in just a moment. And just what can we expect when Prime Minister Netanyahu visits the White House later this week? But first this. Markets are at an all-time high. Euphoria has set in. The economy seems unstoppable. But the last administration has buried us so deep in debt and deficits, it's going to take a lot of digging to get us out of this hole.

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But before that, to one of your many areas of expertise, which is the economy. Aren't tariffs inflationary and won't the cost eventually be passed on to consumers? Well, tariffs disrupt the gains from trade. The reason you trade with other countries is that they produce things at lower cost. You produce certain things at relatively lower cost and there's mutual benefit from exchange. This is why trade is a win-win proposition, not a win-lose proposition. Now, tariffs disrupt that by design. They close the economy and make it impossible to get those gains from trade. Depending on how high the tariffs are, you lose more and more of the benefits of trade. It seems the Trump administration doesn't really

understand that or follow that. They have a seeming misconception. I don't know exactly what's in anyone's mind on this, but they seem to think that since the U.S. runs trade deficits with other countries, it's buying more than we're exporting, that this is somehow a measure of unfairness or that somehow we're subsidizing those other countries. But this is a little bit of a mistake. The reason you run not a trade balance, but a trade deficit is that you spend more than your income. So if you run credit card debt, you will run a big trade deficit with all those retailers who are selling you goods. And we run a huge budget deficit.

It's nearly 7% of our GDP. So we're spending a lot more than our national income. And we run trade deficits with the rest of the world. That's not because they're doing anything unfair. It's because we like to keep taxes low, spending high, saving low, and lots of consumption and basically do that on credit like a credit card. It shows up as a trade deficit because we're buying so much more from the rest of the world. You don't stop that by breaking the trade process. You close the budget deficit. And that's a completely different issue from unfair trade.

How does this end? Do China, Canada, and Mexico impose tariffs on what we export to them? And does the price of everything go up? Well, first of all, when you said inflation, what it really means is whether prices go up, which of course some will, or output goes down and employment goes down. Real living standards will be diminished by these actions. You can look at the market reaction, by the way. All the stock markets around the world are down. It's not that the U.S. gained and they lost. Everybody loses from a diminishing of the gains from trade. So the verdict is a thumbs down that

this makes no sense. Now, that would be true even if there's no retaliation, but there will be retaliation, which means you cut the mutual benefits. Well, we'll also cut the mutual benefits. We'll get a spiral of bad behavior. You know, when I went to school a long time ago, we used to study something called the Smoot-Hawley Tariff in 1930, which set off the Great Depression or intensified the Great Depression, I think it's more accurate to say. But it's interesting, the Smoot-Hawley tariff, one was a congressman, one was a senator, was a piece of legislation. Now our so-called democracy has collapsed to the point where it's just one person deciding these things. A little bizarre. President Trump declares an emergency on our northern border. Did you notice the emergency on the border with Canada? Well,

he declared an emergency, which said, therefore, he has the right unilaterally, stroke of a pen, like King George III that we rebelled against, by the way, to put taxes on imports. By the way, we had a revolutionary war saying no taxation without representation. Here, the US Congress has nothing to do with this. This is a declaration of emergency by one person and an executive order saying, based on that emergency, I'm putting on tariffs against our treaty obligations with Canada, with Mexico, and also with our largest trading partners. Profoundly unconstitutional. But you know, in 1936, in a famous case called Curtis Wright, where FDR banned the exportation of arms from a manufacturer in the U.S. to Bolivia. Supreme Court said, well, if it's part of the president's foreign policy, he can do it. And since that time, all the power has flowed to the presidency.

Well, the Congress looked the other way. It is incredible. And thank you for giving us the precise moment and an explanation of Congress abandoned its constitutional responsibilities fundamentally. And by the way, the American public knows it. I looked yesterday at the Gallup survey of American confidence in our institutions, whether it's the presidency, the Congress, the Supreme Court, the police, the military, the public schools, and so forth. Congress, you know, is at the complete bottom of everything, the lowest level. I think 9% combined said a lot or quite a bit of confidence, 9%. The vast majority said none. They're not none, but very low. Just incredible where the congressmen just became satisfied to get their campaign contributions and to win reelection and have this easy incumbency, and they don't care about their constitutional prerogatives. Why isn't Congress

jumping up and down saying, we are the only ones with the power to tax? That's as clear as can be in the Constitution. But they're not saying a word. Why is the Biden pipeline of aid to Ukraine still flowing, Professor Sachs? Do we even know? I don't think we know much of what's going on right now. There's so much opacity. Every day, it's a little bit different line. Excuse me. So I can't give you an answer of why, because I don't even know what. I don't really know what's happening in terms of, is military aid flowing and not, quote, civilian aid? Even Zelensky, by the way, who speaks nonsense by the day, by the bucketfuls, said, oh, most of that money never arrived. We don't even understand what has really happened to the more than $100 billion supposedly spent on Ukraine. There's no audits. There's no

explanation. There's no nothing. And so I can't tell you, Judge, what's really happening at this moment. Why is it that the Hamas-Israel ceasefire agreement has never been revealed in public? Well, there are supposedly secret promises here and there. Netanyahu supposedly to keep his extremist right-wing militaristic government in place promised that after phase one, the war would resume. And so this is the story right now. And supposedly there are, or not supposedly, it's rumored that there are communications where the United States understood this or didn't understand this. We're in the swirl of propaganda maneuvering, no doubt some fake news, but the secrecy is par for the course. Nothing is done on the open right now because open, honest government would have ended this atrocity a long time ago.

Everything is fake in terms of narrative. What is really going on, we know, which is that the extremist Israeli government, which has had American foreign policy completely under its control, has aimed for decades to not only occupy all of Palestine, but to basically ethnically cleanse Palestine. And this is now reaching the point where the entire world is aghast, shouting no, voting in every way, writing legal briefs about genocide and so forth, because Israel's behavior is so completely obnoxious, violent, and contrary to every international law and norm, that it has come to the point where there is no open discussion of anything right now because if Netanyahu really revealed what his coalition government wants, it would be untenable to everybody and the United

States would be in complete complicity with this mass illegality and violence, which it isn't de facto. What did Netanyahu and the IDF gain by their genocide in Gaza? Well, they killed a lot of people, maybe 60,000, maybe 80,000, maybe 100,000. Otherwise they gained nothing. They demolished the homes and the livelihoods of nearly 2 million people, and they gained nothing by it. They brought the whole world into unity in being aghast at Israel's behavior. They have generated anti-Israel feelings all over the world. They put the country at the greatest risk in its history, in my view.

They gained nothing. But it's a government of unbelievable extremism. What does Netanyahu want from Trump tomorrow? From Trump, he wants the United States to go to war with Iran, and he wants a green light to continue the ethnic cleansing, both in Gaza and in the West Bank. Trump said contradictory things, not unusually. He said, on the one hand, he wants this ceasefire to be sustained and to become permanent. Thanks goodness. Enough killing of innocent people.

It's unbelievable what has happened during the last year and some. But on the other hand, he just said, well, maybe those people in Gaza should go to Egypt or to Jordan or to some other place. And then Smotrich, the basically self-described fascist of the government in Israel, said, that's wonderful. That's our plan. That's our plan. That is the ethnic cleansing plan. And Trump uttered those words and immediately the Arab neighbors, all of them said, no way we're going to be party to another such ethnic cleansing, what the Arabs call a Nakba, a catastrophe, referring back to the time when Jewish terrorists chased hundreds of thousands of Palestinians from their home in 1948. No more Nakbas. And they said, we will not be a party to it. So there's this situation right now, which is completely untenable. Maybe it's just possible. Netanyahu will come and say, you know, I got, I'm going to start the war again. And Trump will say, no, the hell you're not going to. And that would be actually the right thing, of course, to do.

And it would put an end to this unbelievable extremist phase of Israeli history because Israel's extremism depends every minute of every day on U.S. backing. Right. And so if Trump says no, it actually ends, not because the Israelis agree, but because they can't do it without the United States backing. So Trump can make the ceasefire permanent by just saying so. He doesn't actually have to convince Netanyahu of anything. He just has to say, I'm not arming you anymore for this. Just like in Ukraine, he doesn't have to convince Zelensky of anything, he just has to stop the flow of arms. Then the war stops. Is there any significance in your mind to the meeting between President Trump and Prime Minister Netanyahu, the first foreign leader to visit the White House in this term of the Trump presidency,

while the Secretary of State is in Panama trying to shake down the president of Panama and take back the Panama Canal? Let's just say we're in a period of confusion. I don't see much strategy right now, except it could be, I'm going to take the brightest side possible. Maybe Netanyahu is coming here to be read the Riot Act. It's possible. If Trump's smart, that's what he would do. He would tell Netanyahu the war is over. Your extremism is over.

There's going to be a Palestinian state. Then you will have peace. You will have normalization with Saudi Arabia. You will have normalization with your neighbors. But the extremism of trying to control everything, of trying to ethnically cleanse the Palestinians from their land is over. If he says that, very smart, very good for American policy, and okay, Nobel Peace Prize. The other side, and it's quite possible because we don't know, is he's going to say, all my supporters tell me you're right and you should continue the effort to battle on,

or they talk about going to war with Iran or some utterly crazy thing. the president at his word that he wants peace. All I can say is he can achieve what he wants straightforwardly, doesn't have to convince Netanyahu. All he has to do is say the United States is not going to be a party to Israel's wars of conquest, period. That's all he has to say. He could also tell Netanyahu there's going to be a Palestinian state. It's going to live next door to Israel. It's going to be with mutual security and an end to the militarism because all of the neighboring countries agree with that. And so he can explain to the Israelis the most basic fact of life, which is that they need to learn to live in peace in the region and stop the idea of this greater Israel,

which has been the center of this extremism for decades, and which has been Netanyahu's cause for decades, that he can do and Israel can do what it wants because the United States is in its palm. And if Trump is true to his claim of making America great again, he will restore American sovereignty and tell the truth to Netanyahu that the extremism is over. There will be two states, they will live in peace, and the Arab countries will normalize relations with Israel, something considered impossible, but it will happen quickly, but on the basis of the two-state solution. What do you think Netanyahu's reaction will be if Trump tells him tomorrow, oh, by the way, Bibi, we're opening up an embassy in Tehran?

I would like to be there. You know, just to say for everybody listening about Iran, Iran has been seeking negotiations and peace deals and ways to reach the Trump administration during this whole period. And before that, the Biden administration, which completely blew them off because Blinken was totally, he was the Secretary of State of Israel more than the United States, it seemed many times. But the Iranians have been saying in every venue, and I've heard several of them with the president, with senior officials, they want peace, they want normalization, they want diplomacy, they want discussion. Now, if Trump would hear this, it would also be a sea change. Our entire policy vis-a-vis Iran has gone through the Israeli

foreign policy for decades now. We have not had our own diplomacy. When Obama tried negotiating with Iran and succeeded, actually, as part of a multi-country agreement, the so-called Joint Comprehensive Plan of Action, the JCPOA, the Israelis jumped up and down, went to Congress, said this has to stop, and Trump abandoned it. So our whole foreign policy vis-a-vis Iran has, again, like so much of our policy in the Middle East, was dictated by Israel. This is crazy. We're a sovereign country, actually, a sovereign country that underpins Israel's own extremism. So we can say no at any moment. Professor Sachs, thank you very much. I know we covered a full gamut of issues

and I appreciate your time and you allowing me to pick your brain. All the best. I hope we can see you again next week. We will. Thanks a lot. Thank you. Bye-bye.

Bye-bye. And coming up later today at 10 o'clock this morning, Ray McGovern and at 11 o'clock, Larry, 1130, excuse me, 1130 this morning, Larry Johnson, Justin Napolitano for Judging Freedom. I'm out.