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QUEST MEANS BUSINESS
China Announces Retaliatory Tariffs; A Judge Sends Manafort to Jail; Michael Cohen Likely to Cooperate with Investigators; Brazil`s Lula da Silva to Comment on World Cup Matches from Prison; Spain and Portugal Draw 3-3 in World Cup Thriller; U.S.-China Impose Matching Tariffs 25 Percent on $50 Billion Goods; McDonald`s Scraps Plastic Straws in U.K. and Ireland. Aired 4-5p ET
Aired June 15, 2018 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, ANCHOR QUEST MEANS BUSINESS: Paris solutioning (ph) in the closing dollar on Wall Street. Dow is off, well off the lows of
succession, but still down by start of a third of a percent. Thank you sir, one, two, three down (ph) to business, trading is over. It`s all
finished. It is Friday, it`s June the 15th.
Tonight China fires back in the trade war of 2018. Yes it is a trade war. Content is king, and Oprah of course is the Queen. Apple has a new
employee. And a modern day World Cup classic, Christiano Renaldo stuns Spain in (inaudible), by request, live in the worlds financial capital New
York City, glorious day where when the markets down, we of course still starting business.
Good evening. It is a real life full blown trade war. What anyone says we called it here some weeks ago. But now you can pretty much say it`s
official. After skirmishes with its NAFTA neighbors Mexico and Canada. And nasty bruising battle with European allies. The U.S. is in open trade
conflict with the biggest opponent of them all. China. And you can see the reaction to what happened on the stock market.
If you join me over at the big board you`ll see that the market sank. And then stocks regained some of the lost ground after President Trump
announced $50 billion worth of tariffs on Chinese goods. But look at the losers, and you`ll see exactly.
Caterpillar, Chevron, Boeing, GE, all the industrials, the oil companies, heavily down on the day. Some other stocks though did manage to eek out
small gains, but for different reasons. Look at the overall market and you`ll see exactly the sentiment of the day. The Dow was dragged down by
these stocks. All of which rely on a chunk of big sales from China. The market opened as you can see over here.
The market opened down the best part of 200 points. It remained down for most of the session. With the exception of this small rally which came
later in the day. Remember it was a quadruple witching day today. So volume was extremely high. Volatility was intense.
But if you take just this question of what happened in the market. And the reason from China you`ll need to understand. Join me in the trade war
room. Because it is in here that you will see clearly exactly what took place during the course of the day.
Now the truce that was declared back in there is well and truly over. Today China accused the U.S. of firing the fist shot. And it happened
after the White House slapped 25 percent tariffs on $50 billion worth of Chinese goods. That`s roughly 1,100 exports. And it targeted everything
from aerospace to robotics, and cars. President Trump said U.S. intellectual property needs protection.
(BEGIN VIDEO CLIP)
DONALD TRUMP, US PRESIDENT: You know we have the great brain power in Silicon Valley. And China, and others steal the secrets. And we`re going
to protect those secrets. Those are crown jewels for this country.
(END VIDEO CLIP)
QUEST: For the last couple of hours we`ve heard the Chinese response and they have tit for tat retaliated with exactly the same degree. They are
imposing 25 percent tariffs on $50 billion worth of U.S. exports including agricultural products, cars and seafood.
Now there have been many discussions in recent weeks. Pedantic discussions on whether or not we are in a trade war or not. Well I think pretty much
that answers yes. Now let`s ask Richard Haass President of the Council of Foreign Relations. He joins me in Washington. So Richard is it a trade
RICHARD HAASS, PRESIDENT COUNCIL OF FOREIGN RELATIONS: It`s the opening round. I think a war suggests a degree of duration and escalation. But
it`s clearly the opening shots.
QUEST: And on that question of escalation, the U.S. in announcing its measures this morning specifically said in the last paragraph, you`ll have
read it. That if China retaliates with new fresh non-tariff barriers on your back tariffs then the U.S. would respond again. China has responded
and retaliated. It`s in the U.S.`s court now.
HAASS: Absolutely. The irony here is the Chinese reaction. Very similar to the Canadian reaction is to respond proportionately. Not to escalate
but to respond essentially in kind. And in similar levels that targeted American exports. But the administration in advance, as you correctly
said, already indicated that would be unacceptable.
So the ball`s in our court if past is prolonged (ph) the administration now will do some more. And now we`re in - then we`re into an action reaction
tit for tat cycle.
QUEST: Is it your feeling and your understanding that the U.S. will respond because of what they`ve said? I mean if he doesn`t then the
President who hates to look week as we know from Canada the G7, Is almost boxed into responding.
HAASS: It`s not just that he`s boxed in, but I actually believe that he thinks that the United States is better positioned to withstand mutual
escalation, and the Chinese or the Europeans or just about anyone else.
He looks at what for him, as you know, the one and only measure of trade is whether it`s surplus or balance. He says oh the Chinese are running a
large surplus with us, ergo they have more to loose.
QUEST: If we now look at the over arching situation. You`ve got a dreadful relationship with Canada. You`ve got a deteriorating relationship
with Germany over automobiles. You`ve not got China. How serious is this?
HAASS: The answer is it serious. Look it`s serious in so many ways. It`s serious in a narrow economic sense, given the importance of trade. But in
some ways` Richard I actually think it`s even more serious strategically. It removes one of the foundations stones of the post World War II world
that the United States helped build.
The allies it signals that the fact that you`re an ally is virtually irrelevant. We see you as a competitor or as a rival. To China it says we
don`t make any - or not reliable. Plus we don`t cut you any slack if you`re working with us on North Korea.
What we`re actually seeing is American first in action. It was something that was promised in the inaugural speech. Here we are a year and a half
later. This is what America first looks like.
QUEST: And what`s the - what`s the next evidence. I mean - sorry this is the evidence of what it looks like. But when do you believe we will start
to see the ripples ramifications and consequences of it? Because at the moment as I look around the world I see lots of the allies doing there
damndest to hold it together, not to allow this to sink into a cesspit of just more recrimination and retaliation.
HAASS: Yes, but they`re also going to have their hand for us if the President escalates. Be it over Iran, or over steel and aluminum, or
anything else. The United States is not the only country that has domestic politics. Somebody like Trudeau, somebody like Macron or anybody else is
going to have to deal with their domestic situation -- so will Xi Jinping. Even though it`s anything but a democracy, he can`t look to be weak in the
face of American pressure. So again this only goes away if the United States I think essentially finds a way to back off. Or plug this into the
WTO, or essentially stop - stop pressing unilaterally.
QUEST: If I say to you Richard, awe come on the Presidents view on this is, this is all a negotiating strategy. It`s all a tactic. It`s all in
the art of the deal. What would you say?
HAASS: I don`t think so. This is one of the two things he believes into his core. He believes that the world trading regime has worked against
American interest. We`ve been taken advantage of day in, day out. He also believes that the burdens of world of leadership far outweigh any benefits.
So I actually think that he is prepared to see this through quite a bit. It`s not just tactical to cut a deal.
QUEST: All right with your experience. How does the world trading system get out of this mess?
HAASS: I`m not sure it does. I actually think that over the next year we could see the United States essentially issue something of a direct
challenge to the WTO. We`re already close to it as you know. We`re running out of adequate number of Appellate Judges there.
It may be pretty soon that the WTO grinds to a halt. And this is a President who as you know doesn`t tend to believe in institutions. He
wants things to be worked out bilaterally. This may for well be - maybe part of his agenda. So I don`t think - I don`t think we`ve necessarily
crested here. No pun intended.
QUEST: Thank you. Good to see you. We should finish on a more pleasant note. But it`s a good note to wish you a happy weekend. Where the
weathers going to be good and new.
HAASS: Thank you.
QUEST: Thank you very much, indeed, right. And if you really want to know exactly how this is - how deep and detailed it is. The list of tariffs is
long and specific now a few examples on the screen, nuclear reactors for example, spacecraft, poultry incubators. And when - by the way you know
when it talks about them it`s very detailed in what it says.
I asked the Executive Vice President of Ford if he was concerned about the current trading climate.
(BEGIN VIDEO CLIP)
JOESPH HINRICHS, EXECUTIVE VP OF FORD: We`re obviously encouraging all parties to get together. And have global trade that`s free and fair for
everyone. As the leading global exporter of vehicles out of the United States and the largest producer of vehicles in the United States, it`s
obviously in our interest to make sure that we have free and fair trade around the world.
(END VIDEO CLIP)
QUEST: You`ll hear more from Joe in just a moment. Stocks came back very sharply from a 250 point down.
Paula Newton had hoped to catch the 3 o`clock flight to Autoerwath (ph) this afternoon. I think the 3 o`clock`s well and truly gone and you`re
still at the stock exchange.
PAULA NEWTON, CNN CORRESPONDENT: I`m still behind enemy lines, Richard. Please help me out here. Apparently here, though, at the market they felt
that, you know, it was a good day to hang on. You know it was produple (ph), which in (ph) all that means is sophisticated language for the fact
the everybody had to reposition on those futures and those options.
The issue here is that the volume was still quite high, and as you can see the market there, as you said, coming off its lows. Why, Richard? Because
they are listening to people like Mr. Haass say this isn`t a negotiating tactic, and they believe he`s wrong. Anyone that you talk to hear on the
floor trading this market right now says the fundamentals are good. We still have synchronized growth not just in the United States, but around
the world. And they are still trading this market and believe in this market. When will they start paying attention to the whole trade skirmish?
When it escalates and actually starts to hurt GDP.
QUEST: But we did see those stocks. You would expect Boeing, Caterpillar, Exxon, all the heavy industrials, they were creamed at the open, pulled
back towards the end, so we`re looking at Caterpillar up 2 percent. Boeing which came just at 1.3, at one stage it was off nearly 3 percent. So well
off the lows of the day.
NEWTON: Absolutely off of their lows, but again, most people here tell me that had to do with repositioning. Boeing, though, has had trouble for
awhile because as you pointed out whether it`s Caterpillar or Boeing, they know they are in the crosshairs of the Chinese trade. Do you want to talk
about Alla (ph) before we go -
QUEST: You anticipate - well, put it this way. It would be jolly rude of me to say no, I didn`t after you put it like that. Yes.
NEWTON: I thought we had time. Listen -
QUEST: Paula Newton, do tell me about oil because I noticed the oil price fell.
NEWTON: The oil price fell and that sector lost almost 1.5 percent today if you roll through there, and I think that`s going to be the story going
into next week. You know what, we like to look ahead here, Richard. So we`re talking about OPEC meeting next week. What is that issue here right
now? OPEC in 2014 had done such a good job of holding back - pulling out that production there and we had prices not to be seen. That really led
into a market share war as you have covered extensively, Richard, with the frackers in the United States. Guess what? This is going to be an
incredibly consequential meeting as to whether or not it can rein (ph) in those oil prices. Russia and Saudi Arabia basically speaking for the group
already and saying, "look, any production that needs to be made up because of Iran and Venezuela, we can do it," and I think they`re hoping that those
oil prices do not hit the stratosphere, that they like kind of the oil price, where it is right now, and they`re going to keep it where it is.
QUEST: The Canadian Paula Newton who is going to be flying back to Canada, assuming in actually getting there. Thank you, Paula Newton. Safe flight
home. Thank you, and now you`re going to hear from the former Head of the White House Council of Economic Advisors, Austan Goolsbee, on exactly the
economic implications, indeed, of what`s happening.
The trade war fears drag the European market in to the red. The biggest losses were in London. Take a look. FTSE closed down nearly 2 percent,
with the banking stocks taking some of the heaviest hits. All of the other major markets in Europe were down at least half a percent.
Spain and Portugal ended an all square (ph) after a swashbuckling encounter at the World Cup, and Cristiano Ronaldo grabbed a hat trick to level the
tie with this exquisite three kick. A full report from Russia is after the break. And to Americas as (inaudible) join forces, and no not AT&T and
Time Warner. It`s Oprah Winfrey signs a new deal with Apple. We`ll talk about that as Quest Means Business from New York continues.
QUEST: The business of the phone screen has now met the business of the big screen. They like what they saw and they got married. Oprah Winfrey is
throwing her lot in with Apple. The queen of talk has signed a multiyear agreement to produce original program with tech giant. It`s a month after
the Obamas signed a similar deal with Netflix. And Marbel (ph) is now my boss. AT&T has completed its acquisition of Time Warner. That includes
The new division that`s going to hold all the Time Warner or former Time Warner assets - HBO, Warner Brothers, Time (ph), a ton of broadcasting -
it`s to be called WarnerMedia. The retiring Time Warner CEO is gone. Jeff Bewkes said he hopes employees are excited as he is about the future.
JEFF BEWKES, FORMER CEO OF TIME WARNER: because as storytellers, as journalists, as business leaders and catalyst for change, our work is never
really done. We can only run our lego relay (ph) and then pass the baton. For me, that time has come.
QUEST: I`m joined now by two of CNNMoney`s finest, Hadas Gold and Dylan Byers. Gold spoke to the new boss of what was Time Warner, now
WarnerMedia. Johns (ph), thank you. This morning, what did he tell you?
HADAS GOLD, CNNMONEY REPORTER: So John Stankey wanted to be clear to people that he is not going to get involved in the minutia editorial
process of a lot of these creative companies that have come up because you know this is a big telecom company that doesn`t really have experience with
the creative process, but he also gave us some insight on what`s going to be the future for this new joint company. And one of its first things AT&T
plans to do with the Time Warner, now WarnerMedia content is focus on mobile, and John`s saying he was very excited about the possibility of
certain, just for example, a CNN news clip that was tailored to a user based on where they were and what they like to watch, something the user
wouldn`t even have to really go in a choose, but that AT&T would just know about because of all the data that they could glean because of this new
They`re also planning a lot investment into HBO, both in the distribution and also he talked about for the creative side, for getting more shows,
getting more content. And he also talked about CNN. He said that he thinks CNN has a special, social responsibility in the world to talk about
the importance of a free press for an informed electorate. He pushed back a little bit on President Trump`s attack from the media saying that those
concern him -
GOLD: - and he was very clear that he thinks that CNN will continue doing what it`s doing now, that our president, Jeff Zucker, will stay in his job,
and that he`s not going to get involved editorially.
QUEST: Dylan, the theory is, of course, that they bought this vast media empire with a bunch of primadonnas that like to make creative stuff and are
difficult to manage. I don`t know -
DYLAN BYER, CNN MONEY REPORTER: Such as ourselves.
QUEST: Yes, you know - well, let me call - OK, listen to what they`re doing. You heard Hadas just described their vision for technology and
marrying the two together, technology and content. Is it realistic?
BYER: It is realistic and here`s why. The bigger picture here is that the worlds of technology, media, telecom are all sort of colliding. And in
order for a company like AT&T to be able to compete with the Amazons, the Apples, the Googles, the Facebooks, you have to have some sort of content
that you can deliver to your customers and your subscribers. Otherwise, you`re going to get to a certain point where those people don`t need you
Now, how you go about getting content is a different question for tech companies and telecom companies, but if you`re AT&T, you know how to do one
thing very well. You`ve got customers. They give you their data. What you don`t have is the entertainment factor. You can`t give them news, you
can`t give them sports, you can`t give them shows. Time Warner, or now WarnerMedia, gives AT&T the ability to compete in that space.
QUEST: So what about this Oprah-Apple deal, following on, of course, from the Netflix-Obamas? I mean, what`s the rationale behind these?
BYER: Sure -
QUEST: It`s very expensive deals.
BYER: Yes, it is. But if telecom companies like AT&T are thinking about buying media companies, tech companies like Apple and Amazon and Netflix,
they`re not buying media companies. They`re just buying the star talent, whether that`s producers, show runners, the actual performers, the actors
BYER: They`re theory is that, look, we can come in and identify who`s really great. We`ve got hundreds of billions of dollars behind us. We can
offer them so much more than traditional Hollywood studios can, and we can build our own media companies. So, you know, the deal with Oprah is
significant because now all of a sudden if you are part of Oprah`s very large fan base, you are going to have to go to Apple to see some of her
new, original programming. That might encourage you to think, "OK, maybe I should be apart of that Apple universe. Maybe I should be somebody who
owns an iPhone -
BYER: - who owns a Mac," and then also there`s a chance here that Apple might come along and just do what Netflix is doing - just create a
standalone service that people can subscribe to for $9 or $10 a month and get all of that content that they`re locking up, which does include Oprah
and Steven Spielberg and Reese Witherspoon and Kevin Durant. So that`s sort of where the landscape is right now.
QUEST: Dylan, thank you. Thank you Hadas as well in Washington. Ford is reversing the company`s exodus with spiritual home in Detroit. The auto
giant is moving its electric and autonomous vehicles back into the city. It`s a largely symbolic move. It`s after all - it`s only eight miles from
Ford headquarters, which is in Dearbron, which most of us think of as being just about in Detroit anyway.
I asked Ford`s Executive Vice President of Operations if the firm is also looking to shift its production towards bigger cars.
HINRICHS: Well, we are seeing worldwide a movement towards more SUVs or crossover body styles. Traditional sedans with a hood or roof and the
trunk have been declining is sales volume, especially in North America and China for a number of years, so we`re looking to invest where customers are
going, and if you look at that trend continuing because now people have the versatility of an SUV with the fuel economy they could get 10 years ago.
And you will see more of that going forward, but, of course, we`ll be serving passengers in many different ways with different body silhouettes
QUEST: Right, but what do you do at the smaller end? I suppose you make a smaller SUV? I mean, the sort of the Ford Focus or the (inaudible) Ford
Fiesta or that very small vehicles, what do you there?
HINRICHS: Sure, well one thing that we do actually, we`re actually lifting the smaller vehicles up a little bit and providing more of a crossover type
look, a more active type look. We`ve been doing that in Europe. It`s been very well-received. We`re also making smaller SUVs as you`ve mentioned,
and we`re also looking at what`s the next generation of silhouettes or body styles? If you go back in time, the Model T was more like an SUV and it
evolved over time to be these long sedans in the 50s and then what we have today. So what`s next? We think a lot of versatility when it comes to
usefulness to the consumer.
QUEST: And the concept of the car company actually being - the car company being a tech company. The amount of technology, the sort of investments
that are being made in ride sharing, the sort of technology that has to be important for autonomous vehicles as we get closer and closer towards that.
How much further, how much more do you need to do?
HINRICHS: Well, you`re right. I mean, automotive companies today are technology companies. You think about how many lines of code there are in
a vehicle. There`s millions of lines of code in our infotainment system, our powertrain calibrations, all the computer technology that`s already on
a vehicle. But going forward, the capability and capacity needed to handle autonomy of connectivity of the vehicle is enormous. And so, you`re going
to see more introduction of new technology and more computing capability in the vehicle itself, as long as the sensory technology that goes around with
it to make the autonomous vehicle happen.
QUEST: Is there a feeling that Ford has found its footing again? All right, the last CEO left in the somewhat difficult circumstances, but is
there a feeling now within the company that whatever lack of direction there might have been or in execution has now been resolved and that the
company whether it be 30 percent American, 30 percent Europe, 30 percent Asia or whatever the breakdown of Ford`s global operations, you`re starting
to get demand and supply matched up?
HINRICHS: Exactly. We definitely believe so. I mean, we started with our first quarter earnings call where we rolled out our smart vehicles for a
smart world and our value creation and roadmap and framework that we`re using. We talked about where we make money in the world and where we have
opportunities to make decisions around how we allocate capital. And we believe we`re very laser focused on our strategy and our plan and to be a
trusted mobility company that can deliver all these things for consumers.
HINRICHS: We feel really good about our strategy, we`re communicating that, and we`re obviously executing, and there`s a lot to be done over the
next several years, but we`re really excited about it.
QUEST: The Global Head of Operations for Ford. Now, the next generation of autonomous driving could rely on human brainwaves to control them.
There`s a terrifying thought. An exclusive interview, Anna Stewart gained access to Nissan`s confidential project in Yokohama.
ANNA STEWART, CNN CORRESPONDENT: The race toward an autonomous future is on for the automotive industry, and Nissan says it`s in the lead.
UNIDENTIFIED MALE: Keeping ahead of the competitor is very important because we cannot lose this new mobility war. So we have invested a lot in
the past and we will continue to invest a lot.
STEWART: It`s not just about driverless cars, but about finding new applications to make that technology relevant for consumers. This is
Nissan`s Advance Technology Center. It`s where they develop and design the future, and I mean way into the future. It may look like your average
corporate campus, but this place is top secret, and actually we`ve been told to switch this camera off until we get inside one of the labs, and
we`ll be the first TV camera crew ever to be allowed in.
And inside the lab is Nuchine Gorge (ph) one of the brains behind Nissan`s next big thing - brain to vehicle technology. Brain to vehicle, what does
that even mean?
NUCHINE GORGE (ph): It means a connection - a connection between our mind, between our natural intelligence, and the artificial intelligence that we
have in a car. Maybe we can become better drivers or maybe we can have a much better riding experience. I call it (ph), you know, four year on
STEWART: Instead of totally overriding your driving, this technology adapts to your driving in real time and can make real time adjustments as
you go. This is an EG headset. It`s the closest you`ll get to measuring brain activity without actually opening up the brain. Thankfully, they`ve
made a more user friendly design. Time to test my brain and see where an autonomous car might want to step in.
GORGE (ph): Keep it to the right. Just keep it straight forward. OK, that`s fine.
STEWART: Don`t oversteer. The road ended.
GORGE (ph): Yes.
STEWART: That`s a cheat.
GORGE (ph): Really?
STEWART: You can`t just end a road.
GORGE (ph): Where are you looking (ph)? Trust on button (ph).
STEWART: Needless to say, it took me a few gos to complete the whole course. The results are in and they`re not good. The motor cortex of my
brain reacts to corner in the bottom 40 percent of drivers.
GORGE (ph): We don`t have to look at the brain.
STEWART: You can just tell I`m a bad driver.
GORGE (ph): Yes, unfortunately.
STEWART: Brain to vehicle driving would certainly assist people like me, but it`s in the very early stages of development. But autonomous driving
in other forms will hit the roads much sooner. The technology is being developed by automotive companies worldwide. The fatal Uber crash in
Arizona in March 2018 set alarm bells ringing with the research into this futuristic form of transport continues. Anna Stewart, CNN Money, Tokyo.
QUEST: Now, as we continue tonight, if you ask my producer who`s talking to me in my ear about the biggest World Cup match so far, he will say to
you, "it was an insanely good match." We`ll talk about it after the break.
[16:30:00] QUEST: I`m Richard Quest, there`s more QUEST MEANS BUSINESS in just a moment when Christiano Ronaldo just what only he can do on the
biggest stage of all, Amanda Davies is in Moscow -- and goodbye plastic, hello paper.
McDonald`s is making a big change in its British restaurants. As we continue tonight, you`re with Cnn and on this network the facts always come
first here. China has announced retaliatory tariffs on $34 billion worth of American products.
It comes hours after President Trump imposed 25 percent tariffs on $50 billion worth of Chinese imports. The Beijing tariffs will start on July
the 6th. President Trump`s former campaign manager Paul Manafort is going to jail after a judge ordered that his $10 million bail be revoked.
The special counsel Robert Mueller`s team has accused Manafort of witness tampering and he`ll now have to wait for his trial behind bars. He`s
pleaded not guilty to all charges. President Trump`s personal lawyer Michael Cohen may decide to cooperate with investigators.
As sources tell Cnn he`s unhappy with how the president and his lawyer Rudy Giuliani have treated him. When Mr. Trump was asked if he was worried
about Cohen cooperating, the president said "I did nothing wrong." It`s an unexpected edition to the many commentators on the World Cup.
The imprisoned former Brazilian President Miss Luna Da Silva, he`ll be extending his thoughts to a "Vtb" presenter who will meet him at an
audience. Now, the former president is serving time in prison for corruption and money laundering.
Connoisseurs of the beautiful game have been salivating of the prospect of Spain playing Portugal in the World Cup and it turned out to be an absolute
Spain looked like won it after Fernandez`s stunning strike -- oh, yes, what a try, rattled the post, both post, hit that on the way in. But Ronaldo
had the last word, wonderful free kick, that`s it for the Portuguese star and the result 3-3.
Amanda Davies is in Moscow. Now, Amanda, do you agree with my producer, Tom, who said it was an insanely good match.
AMANDA DAVIES, CNN: It was Richard, I know you are not the biggest football fan in the world, but I think even you would have got excited
about this one. And here we are in Red Square and there were people literally crowded around the TV studios desperate to get a glimpse of a TV
screen to be able to keep up with what`s going on or was going on a few hundred miles away south from here in Sochi.
This is a match that had been built as perhaps the biggest match of all the group stage and it really didn`t disappoint. Portugal, the 2016 European
champions up against a 2010 World Cup winners, Spain of course.
Spain attached that big crisis in their camp this week, they attached their coach sacked just 48 hours ahead of this game. But it went one way, it
went the other, but you have to say it was a Christiano Ronaldo show.
He worked his socks off and scored a hat-trick, a penalty from the 4th minute, then took an advantage of a mistake from David de Gea; the Spanish
goalkeeper and then scored a sensational free kick to get a point for Portugal to pull the game level at 3-3 as you said.
But you have to say, this will feel more like a win for Portugal and a defeat for Spain, such with the roller coaster ride of emotion.
QUEST: And if you take that point and you look to the progression of each of those teams, what does it tell you?
DAVIES: Well, I think it tells you that even though Iran are currently sitting top of group B after their last gasp win in very emotive
circumstances against Morocco. You have to say it is still Spain and Portugal very much in the driving seat going forward given everything that
had happened in the Spanish camp this week.
They will take a point from this game, they will expected --
QUEST: Right --
DAVIES: To beat Iran and Morocco. Portugal will very much be in the same boat.
[16:35:00] The bruxing here is the performance of a Christiano Ronaldo, many people saying, you know, age 33 likely to be his last World Cup, this
is his last chance to shine on this stage and he has done it in such sensational form.
The superlative if you look across social media are endless. It was very much a Christiano Ronaldo --
QUEST: Right --
DAVIES: He will be stealing the headlines, it will be very interesting to see what he can do carrying on --
QUEST: Right --
DAVIES: In this competition.
QUEST: When the competition, when the World Cup is being held in European countries and elsewhere, there`s always been the great opportunity for fans
to go quickly and easily. Visas aren`t required, you live across the border, you go for the day or two.
And are there many out-of-country fans who`ve made the trip to Russia? Is there a feeling in Moscow, in Russia of excitement?
DAVIES: I can speak very much about what I`ve seen here in Moscow, Richard, we haven`t been anywhere else as yet, but I`ve been here since
Saturday, so almost a week.
And I have to say we`ve been really presently surprised by the real diversity of fans from around the world that we`ve seen. There`s
Australians, we`ve seen Argentineans, Peruvians, fans from Saudi Arabia, from Egypt, everybody really is here to have a party.
We were laughing that yesterday around the fan zone, it was the biggest contingent of Peru fans. More so really than Russians or some of the other
fans that we`ve seen. And they have an epic 8-hour journey to get from here in Moscow to Saransk --
QUEST: OK --
DAVIES: By tomorrow, when they kick all by Sunday, when they kick off their campaign. It will be epic for the -- you know, if you come to
Russia, people want to get their photos taken here in Red Square with Saint Basil`s behind them.
So at the moment, this is very much a focal point, and there`s lot of stories, some people getting the train, some people jumping on planes to
get around Russia. It isn`t as easy as some other countries. I think that is fair to say.
But people are seeing it as a real adventure, an opportunity to get a taste of a sunset, wouldn`t necessarily have come to otherwise.
QUEST: As we head towards the competition by the end of it, we`ll have a look at some of your snappy snaps. This is me here, there is me there,
we`ll have a look at some of your pictures that you`ve been taking, you have enjoyed in. Amanda, good to see you, thank you very much.
As we continue tonight on the program, American jobs protected or hang out to dry. We`re going to look at the impact of one of Donald Trump`s latest
tariffs. It`s one of the humble washing machines.
QUEST: Remember when tariffs first started in January, they seemed so simple back then. When the tariffs began, they were imposed to protect the
Washing machine industry -- washing machine to protect American jobs and solar panels as well were involved.
[16:40:00] But it was washing machines that captured our imagination because of the alleged dumping of imported washers below cost, thanks to
same subsidies. Now, that was the humble washing machine. Since then of course, you`ve got metal tariffs that have made U.S. steel around 50
percent more expensive than steel in Europe or China according to S&P.
Now, there`s plenty of steel in that washing machine, that`s how much we know. And this Spring, the U.S. laundry equipment prices have rocketed
some 17 percent. Can we say this connection -- nobody knows that washing machines have got more expensive, everything else has as well.
And in Europe and Canada, they`ve been talking for tariff retaliation and U.S. made washing machines of course on the list. So those washing
machines could have problems when they go to Canada or Mexico.
Ask yourself this, do tariffs help U.S. jobs or U.S. consumers and longer term. Do they in the both? The traditional economic orthodoxy is that they
do. Austan Goolsbee is the former chairman of the White House Council of Economic Advisors, he joins me from Chicago.
Austan, you know very well the arguments for and against tariffs, every time they`ve been used steels in President Bush`s administration
ultimately, they hindered. So looking at what`s happened now, how concerned are you?
AUSTAN GOOLSBEE, FORMER CHAIRMAN, WHITE HOUSE COUNCIL OF ECONOMIC ADVISORS: I`m pretty concerned, you know, parents can be sitting downstairs and
there`s a dreaded sound, you hear womp and then you listen if someone is crying and you may be running up the stairs because someone is going to be
We just heard a loud womp and now we`re waiting to see if there`s going to be screaming. Because the $50 billion of tariffs that the president
announced for two weeks from now to put on China, that was within hours, responded to by China with $50 billion worth of tariffs are going to put
back on the United States, very well could be the first firing shot of a trade war.
And if we get a full blown trade war between the two biggest economies of the world, we`re going to have a recession worldwide. It`s not going to be
limited to the United States or just China, it`s going to spread to everyone.
QUEST: And there was -- as I recall, it is very complex, you`ve got this $150 billion that the U.S. has promised, which is just about tariffing
everything that they -- that will be sent one way or the other. That would be on the grounds of IP protections as well.
So there were -- the U.S. has already set out what it would retaliate against if there was a tit for tat.
GOOLSBEE: Yes, look, here`s the thing. I was in the Obama administration, the Obama administration filed more WTO grievances against China than all
previous presidents combined. So I`m not faulting the Trump administration for identifying IP protection and violations in China, that`s a good idea.
But the thing you do if you`re going to try to mobilize to get the Chinese to change their behavior, the first thing you do is you go get your allies,
and Donald Trump is a major danger of violating what we call the gunfighters credo which is don`t pick seven fights if you`re carrying a
Our allies against China in this fight on intellectual property would be Europe, Canada, Mexico, Japan, all the very countries that he`s already
launched a trade war, a threat of trade war with who are our allies.
I actually think that it`s more likely that China, I never thought I`d be able to say this, China is going to go to the allies of the United States
and ask them to join China in filing a worldwide grievance against the U.S. at --
QUEST: OK --
GOOLSBEE: At the WTO and they`re probably going to succeed, and that is a scary thought.
QUEST: And so the question I ask, I guess earlier in the program, Donald Trump would say, this is a negotiating strategy, this is the art of the
deal, he`s laying it out, he`s being fair, but the -- realistically, at the last, everybody knows that the last hurdle that it all pull back.
GOOLSBEE: Well, God, I hope so. You know, the only thing far be it from me to evaluate or give advice to President Donald Trump about negotiating.
But if your goal is to get the Chinese to respect more intellectual property from U.S. businesses --
QUEST: Right --
GOOLSBEE: As I say, the first thing you do is get all your allies together. Everybody who would agree on that point, which includes the high
tech firms of Europe, of Canada, of Japan, but we can`t do that because we just enraged all of those allies with these other behaviors and we`re
engaged in tariffs that are not tied to anything specific.
There`s not a specific ask to China --
[16:45:00] QUEST: Right --
GOOLSBEE: To A, B, C on intellectual property or else we will put in D, E, and F tariff. This is just blanket $50 billion with an increased threat of
another 150 billion.
QUEST: Good to see you, Austan, I think you`ve just introduced a new economic term to the QUEST MEANS BUSINESS viewer, the womp which I think we
can safely say will now become part of our regular lexicon, thank you sir, good to see you.
QUEST: Now, Philip Jennings is the General Secretary of the UNI Global Union and he joins us now. How concerned are you of what you see as a
deteriorating trade environment, Philip. But -- because arguably, what the president is doing is protecting U.S. jobs.
PHILIP JENNINGS, GENERAL SECRETARY, UNI GLOBAL UNION: I will say that the global trade union movement is very concerned about the deterioration in
the level of geopolitical discussions. We have more evidence of a fractured world.
The last thing the workers of this world want is an all out trade war between two of the largest trading nations in the world. Now, it could
well be that Donald Trump is asking the right question about trade and the consequences on working people, but his answers aren`t up to the nature of
the question that he`s asking.
And what the previous speaker hasn`t mentioned, I`m not sure if you have, Richard, either, is a whole question about the impact of these trade deals
on working people and the absence of proper labor protection, the absence of human rights standards and labor standards in these agreements which
will give workers and their organizations like mine the ability to negotiate on a fairer basis wages in terms of conditions of employment.
Are we worried? Yes, but sorry --
QUEST: Donald Trump, if you take the original TPP, the worm, maybe not enough to your -- maybe not enough to your liking, but in trade
negotiations now, there`s very much --
JENNINGS: Yes --
QUEST: A social element of workers element of safety and environmental protection element in the negotiation. Now, I suspect you would say it`s
not enough, but it is there, Philip.
JENNINGS: Yes, it`s not enough, it`s just an element, there`s insufficient enforcement mechanisms to ensure that these things stick in practice.
We`ve had enough of trade deals where the price of those trade deals is on the shoulders of workers.
We have millions of workers in export processing zones where there are no rights of protections whatsoever. It is clear that perhaps what is
worrying Donald Trump about Canada, what`s worrying Donald Trump about the European Union.
Is it just last week, the European Union improved their trade defense --
QUEST: Right --
JENNINGS: Instruments as they call them, to take more into account the labor and environmental standards. And they`re beginning to have teeth.
QUEST: Yes --
JENNINGS: We are slowly winning the argument --
QUEST: OK --
JENNINGS: About labor and environmental concerns. And I think this is the beginning of a process where we would at last see some common sense and
some good economic thinking about these trade deals and the impact that they have on working people.
QUEST: And ultimately though, we always come back to this when you and I discussed this. So consumers in western countries, western developed
economies have to accept that they will have to pay more for certain consumer goods to allow for a higher standard of living for your members in
JENNINGS: Yes, Richard, five years ago, the Rana Plaza factory collapsed, 1,130 Bangladeshi workers lost their lives in a factory that was not fit
for purpose. Those big brands that we all know, those household names, those high street names were all manufacturing there.
And when we asked the world`s consumers, are you prepared to pay 5 cents more for a T-shirt, or $1 extra to ensure that the people in those
factories have a decent wage, have a decent life and have had some safety concerns.
The consumers of this world, I think are sending us a very clear message as are the millennial consumers --
QUEST: Right --
JENNINGS: They don`t like trade deals, then on the backs of workers. They don`t like trade deals where there`s no proper health and safety standards.
They don`t like trade deals where environmental concerns are thrown out the window --
QUEST: All right --
JENNINGS: They don`t like trade deals which question public services. The consumers of this world are ready to pay a fair price for a fair product
made under fair conditions.
QUEST: It`s quarter to 10:00 in Liverpool, you can get out and have a couple before they close --
JENNINGS: Yes --
QUEST: Before they close the pub tonight. Enjoy it, Philip Jennings --
JENNINGS: Yes --
QUEST: Thank you for joining us from your comforts.
JENNINGS: Thank you Richard, all the best to you, thank you --
QUEST: Thank you. Now, we continue tonight on a busy program, great stuff. McDonald`s is joining the fight against pollution, it`s scraping
plastic straws with some of its biggest markets.
[16:50:00] We`re going to discuss the impact, what is the significance? Think about it, it`s a humble plastic straw that deserves this, there`re
very big changes as a result.
QUEST: All seems so ordinary and so obvious. Think about it, how many times have you sort of gone through this process and well, the rest is just
obvious. Now, McDonald`s in the U.K. is getting rid of the plastic straws at its restaurants in Britain and Ireland and it`s starting in September.
Instead, it`s going to use environmentally friendly paper straws. The fast-food chain with a number of firms that are looking to reduce their
plastic waste. Craig Leeson is the director of the film "Plastic Ocean" joins us now, good to see you sir and thank you for taking the time.
This is a victory for you.
CRAIG LEESON, FILM DIRECTOR: It is a victory and any recognition by a corporation or a government or even an individual, last thing, will use
plastic is something that we don`t need that is damaging to the environment, that causes human health problems is the victory.
And so for McDonald`s to admit this, sends a message to other corporations that this kind of product shouldn`t be tolerated anymore, and certainly the
next generation is being left with the problem of dealing with this.
And they don`t want to deal with brands that are involved with single use of plastic.
QUEST: What`s fascinating though is the way in which this is very much being taken off in the U.K. largely due many campaigns and things like the
evening standard newspaper and the like.
But when the issue of plastic straws were raised by McDonald`s shareholders in the U.S., they voted to continue with them. So there`s still opposition
to getting rid of the plastic straw.
LEESON: We`ve seen opposition amongst many companies. I mean, Malibu in California bans single use of plastic items, there`s one company that has
resisted that and is paying the penalty for doing so, which is Starbucks.
And they feel that their clients want plastic straws whereas everybody else within that community thinks that that`s not acceptable. How acceptable
that remains to their clients will be seen because consumers are starting to spend more --
QUEST: Right --
LEESON: Wisely, they`re making smart choices with their dollars. And as we`ve seen, single-use of plastic items are causing such damage to the
environment that they don`t want to be a part of that. So corporations that are continuing to perpetuate the single use of plastic items are
engaging in what we call brand damage.
QUEST: And that brand damage, for example, when does it end? I`ve got a plastic straw in my hand, but I`ve also got a plastic lid on the cup. Now,
arguably, that is also single-use plastic, but we definitely need the lid to prevent the hot drink or whatever from spilling.
[16:55:00] So it`s -- I guess, if it was as simple as saying get rid of all single use plastic, everybody would get on with it. But there`s a
complexity to the issue --
LEESON: Yes --
QUEST: That doesn`t -- are you, go on, go for it.
LEESON: Yes, but Richard, you don`t need that cup in the first place. You can take your own steel container to the coffee shop and have them put the
coffee in your steel container which you can re-use time and time again.
The -- in most coffee shops, even the paper cup which you think is paper, most instances, it contains 27 percent plastic, which is a line that --
QUEST: Right --
LEESON: Presents -- prevents the cup from going soggy because of the liquid contained within it. But you can solve that --
QUEST: Right --
LEESON: Problem, you can stop that waste going into the stream by taking your own cup to the store -- and in many cases, we`re seeing companies that
are enlightened by the problem, actually offering discounts to customers --
QUEST: Right --
LEESON: Who bring their own keepy(ph) as they`re called.
QUEST: Good to see you, sir, thank you. You got up early in the morning to join us from Hong Kong and we`re very appreciative, thank you very much
sir, have a good weekend.
LEESON: Thank you.
QUEST: We will take our profitable moment after the break.
QUEST: Tonight`s profitable moment, let`s just be honest about it. Over the next month, very little work is going to be done in many companies.
Just think about it, what I saw today in the QUEST MEANS BUSINESS production team is anything to go by, the World Cup is going to dominate.
Producers, everybody is just watching the World Cup and cheering along with everything they see. So get over it, enjoy it, relax, it only happens once
every four years. And that`s QUEST MEANS BUSINESS for tonight on an insanely busy day, I am Richard Quest.
Whatever you`re up to in the hours ahead, have a great insane weekend, see you on Monday.