Billionaire investor Ken Langone, the co-founder of The Home Depot (HD) and chairman of Invemed Associates, said that U.S. political leaders have been taken advantage of and embarrassed by trading partners for years.
“For years, and years, and years, and years, and years, our political leaders have had their pants taken off by our trading partners,” Langone said at Yahoo Finance’s All Markets Summit.
Langone expects that to change with President Trump. A longtime Republican, Langone is a supporter of Trump’s accomplishments. He added that Trump has done “more in two years than the last five idiots in the last 30 years.”
“The issue on tariffs— game, set, match, fellas,” Langone said. “When the rest of the world, pardon me, was on its a–, we had a moral obligation to help them get on their feet. China, today, is the second largest economy in the world. They ought to be on an equal footing with us, and we should be on an equal footing with them.”
Langone then referred to the U.S. helping rebuild Western Europe after World War II via the Marhsall Plan.
“We did it, and we’re good for it,” he said. “But now, guess what? You pay your own way. And I think we have been made monkeys. We, I’m talking about our political leaders, over the years. Sure, China wants to keep things the way they are. Germany wants to keep things the way they are. I know something right now — if I’m going to deal with you and I’m happy the way it is, that means I’m either got as good a deal or I’ve got a better deal.”
Presently, the EU charges a 10% tariff on imported U.S. cars, while the U.S. charges 2.5% for their autos.
“So all of a sudden, this guy [Trump] shows up and say, hey, guys, something’s wrong. We only charge you 2.5% for bringing all your cars into America …. Go look at the BMWs, and the Mercedes, and the Audis, and the Porsches, and you name it, all over New York City, all over America. They don’t buy our cars over there for one reason, they burn up too much gas, and they’re too big. So we sell a pittance.”
According to Langone, Germany has an opportunity to be “statesman-like” by lowering the tariffs on U.S. autos.
“It’s a win for them because the numbers are lopsided,” he added.
While he’s a supporter of Trump’s policies, Langone said he wishes that the president did things differently.
“Give him credit,” he said. “He’s behaving exactly the way he behaved when he was running for the presidency. He got elected. So maybe my way is wrong, and maybe his way is right. I’m not saying. But I would say to you, I’d like it better if he took a few less victory laps, but I ain’t going to challenge him. I’m not going to challenge him, because he’s getting the results. And whether you like it or not, he’s got something to do with the prosperity we’re experiencing right now. Big time.”
When asked specifically on the impact of the latest round of tariffs for $200 billion worth of Chinese imports at 10% with the expectation of 25% in January, Langone made a case for why it’s in everyones’ self-interest to end tariffs.
“Life insurance works, believe it or not, because most people don’t commit suicide,” he said. “Think about it. If you sold life insurance and right after the guy bought the policy, he jumped out a window, and everybody did the same thing, life insurance company’s going broke.
“People will tend to do what’s in their self-interest that’s right for them. It’s in our interest and our trading partner’s interest that we not have tariffs. So you’ve got two choices. You start a war — we’ve had wars in the past because of trading issues — or you do what this guy’s doing. But it isn’t going to be the status quo. That’s over.”
Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter. Send tips to email@example.com.