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No butts in line! How many times did you hear that in kindergarten? Point being that Americans learn the concept of fairness at an early age. When faced with unfair trade practices, we react—as we did at the Boston Tea Party, and how United States Trade Representative Robert Lighthizer is reacting to NAFTA’s outdated automotive rules of origin. Under current NAFTA rules, at least 62.5 percent of the net cost of a passenger car or light truck must originate in the U.S., Canada or Mexico to avoid tariffs. Lighthizer wants the threshold raised to 85 percent and half the content made here. Since the U.S. absorbs the vast majority of new car sales from Mexican manufactured autos, this seems quite reasonable. We’re already dealing with a 62.5 percent quota within the context of a free trade agreement. This implies that upwards of 37.5 percent of auto parts could be originating from outside Canada, the U.S. or Mexico and thereby piggybacking off our free trade agreement. It’s certainly free for the interloping countries, but it sure ain’t a free deal for us. It gets back to the first rule of kindergarten: no butts in line.

Remember Mickey Kantor? He was President Clinton’s USTR and also served as Secretary of Commerce. I recently ran into him at an event hosted by the Los Angeles County Economic Development team and the LA World Trade Center. At 80, he is sharp as a whip and full of spunk. “NAFTA has been good for all three countries. We’ve lost 7 million manufacturing jobs since 1980 but have gained 33 million other jobs. We are doing quite well. Just listen to your president as he waxes eloquent about how strong our economy is. Well, I guess NAFTA hasn’t killed it.” OK … but now a reality check. The U.S. population in 1980 was 226 million. Today, it is 324 million, an increase of 98 million. So, a net gain of 26 million jobs versus a population gain of 98 million is not all that stellar. It begs the question: How many more manufacturing jobs would there be without NAFTA? All I’m saying is that when job stats are attributed to NAFTA, we have to ask is that because of NAFTA or in spite of it? Ambassador Kantor went on to share that he most definitely agrees that NAFTA needs to be re-worked (“That was eons ago”) and that trade has to be fair and conducted on a level playing field. In essence, three things right out of Bob Lighthizer’s playbook, which just goes to show you that trade is one area where Republicans and Democrats can come together.

President Trump’s State of the Union Address was a 10. Whether you are a business owner or an employee working in the private sector, how could you give it any grade except an A+? Economic development agencies are going to get busy fast showing domestic and foreign corporations available plots of land upon which to build. As for young Mr. Kennedy’s rebuttal? He gets a C-. While the delivery was “Kennedy-esque,” the substance was weak. They were the same old tired lines we have heard from Nancy Pelosi for too long, with no facts to back them up.

Did you catch the news that China’s economy grew by 6.9 percent in 2017? He won’t say so, but President Trump just raised his own bar for where he wants to take U.S. growth. If China can post 6.9 percent growth, Trump will shoot for 7 percent. Preposterous, you say? It happened once before in 1984. I wouldn’t bet against it. We are just now getting glimpses of what the corporate tax cut will mean. The economic benefits from so many companies announcing new economic expansion in the U.S., and raises for workers, will take a few years to show up in actual statistics. And we are just seeing the tip of the iceberg for now. When the lower half of the S&P 500 companies kick their investment into gear to keep pace with their larger cap brethren, it will set off a chain reaction of growth that will rival post WWII expansion. Following suit will be thousands of SMEs and when that happens, we could indeed see GDP growth at China’s level. And the Dems said that the tax cuts unfairly favored “big corporations?” They really do need to find a story to tell.

Speaking of China, interesting poll results from the American Chamber of Commerce in China show that although three out of four companies say they feel less welcome in China than before, nonetheless by the same margin companies anticipate increasing their investments there in 2018. Of course, the survey was taken before the Trump tax cut was passed. So, let’s see if those companies are still eating from the same rice bowl as the year unfolds.

It’s hard not to notice the ads being placed by Pratt Industries Chairman Anthony Pratt in the Wall Street Journal touting Team Trump’s accomplishments while at the same time advocating to “export food, not jobs” and reminding us that this administration has cut 22 regulations for every new one. Dilly dilly.

Remember the dinner conversation from my last column?

A reader writes:

And here we go again–another attempt to claim that there is a unique “cultural” component to counterfeiting in China. After two decades fighting fakes in both the U.S. and China (as well as dozens of other countries), I can definitively state that it just isn’t true.

Most counterfeits are currently produced in China not because of a different cultural approach to concepts of ownership, but because most of EVERYTHING is currently made in China. For a variety of reasons, it is where people go to get products produced. So, it is no surprise that it is also where people go to get counterfeit products produced. After all, if all things were made on the moon, then the counterfeits would be made on the moon as well!

Consider Peter Baldwin’s book The Copyright Wars: Three Centuries of Trans-Atlantic Battle. In it, he documents how America was the major source of copyright theft from the dominant power of the time, England, from its founding until well into the 1800s. This had nothing to do with any imaginary cultural weakness in the American people. Rather, it was simple economic reality. And if we are asking the question about why counterfeits are mainly produced in China, we have to ask the question why counterfeits are mainly consumed in America and Western Europe. The answer in both cases is not some theoretical cultural bias, but nothing more than the fact that some economic actors are always willing to break the rules if it will make them more profit. Those bad actors do not represent some basic cultural truth about the society from which they come–they only represent that every society produces a subset of economic criminals.

William Mansfield, Director of Intellectual Property, ABRO Industries, Inc.


Will the U.S. play the Section 301 card against China? Doubtful. To refresh your memory, Section 301 is an unfair trade enforcement provision of the 1974 U.S. Trade Act. These things mean little to China and more likely even less to President Trump. Both Xi Jinping and Trump know that in the high stakes game of trade negotiations, geopolitical events and concerns–such as North Korea—can quickly become the tail that wags the dog. The Chinese are incredible negotiators and hold many aces in that region of the world. It’s difficult to know exactly where they stand on North Korea but the bigger deal we make out of it, the stronger they will feel their hand is in trade negotiations.


I may be wrong, but 90 percent of President Trump’s trade rhetoric may just be pre-negotiating posturing. Keep in mind that developers are master negotiators. For example, if building a 700,000-square-foot project, they may ask approval for 1 million square feet knowing that the other side feels like they scored a “win” by chiseling the project down to 700,000 square feet. But if the developer started out asking for 700,000 square feet, he or she may only end up getting permitted for 500,000. Could that be what’s on President Trump’s mind when he declares NAFTA is going to need major rewrites?

I’d like to think so. We import $59 billion more in goods from Mexico than they import from us. More importantly, Mexico imports $143 billion more in aggregate

from other nations than they import from the States. Assuming they can source these same goods from the U.S., this means that there is $84 billion in wiggle room for Mexico to increase their imports from the States. Now, if you are President Trump, what are “best practices” for negotiating an increase in that delta? Answer: You first have to get them to think you are serious about cutting off their exports, otherwise they have very little incentive to play ball.

Interesting to note is that for this strategy to work, people have to work themselves up into nothing short of a “trade hysteria,” which they have. And the irony of ironies is that the media have played right into the president’s hand. By running around with their hairs on fire, the media have set the stage Trump may have hoped they would, namely that Mexico (and some in the trade industry) actually believe he will go through with it, which may be the scenario he needs to successfully negotiate. We have never had a president who is as skilled in business—or the art of the deal—as President Trump. As they say in China, this is his rice bowl. Now if President Obama had said these things, I would have been worried because he had zero business experience and did not believe in American exceptionalism. My prediction? U.S. exports to Mexico will grow by $20 billion over the next several years.


The Wall Street Journal is my favorite newspaper, but it was wrong on its trade deficit commentary. In their op-ed piece, they maintained that a trade deficit is no big deal and, in fact, it can be a good thing in that it’s a sign a nation’s economy is healthy as evidenced by its citizens’ robust spending on consumer imports. But all this ignores the 600-pound gorilla in the room. At its very essence, a trade deficit is empirical evidence that at least some sectors of the country’s manufacturing industries are in decline, and not necessarily from lack of talent or innovation or unwillingness to take risks or work hard. No, the decline can be from over-regulation and taxation.

Now you can argue that a trade deficit simply means that other countries are able to produce certain manufactured goods–like flat screens—more efficiently and hence, why not import if the price and quality are right? But that ignores the fact that America is unable to produce the same product at the same price point and quality. Why are four out of five flat screens sold in the U.S. from imports? Can’t we make flat screens just as well and be the world’s low-cost supplier of them? Of course we can. It’s not all about labor costs. We do have the technology to automate. And creating the machines that automate manufacturing can create American jobs all the way through the supply chain. Trade deficit numbers are true indicators of the overall health of our manufacturing and the regulations and taxes that can inhibit.


Let go the top-gallant sheets! In a strange Back to the Future twist, Maersk Lines is going to experiment with partially powering one of its ships by rotor sails. The project will be the first installation of wind-powered energy technology on a product tanker vessel, providing insights into fuel savings and operational experience. Expectations are that it could save 7 to 10 percent of fuel costs. It’s not exactly a return to the glory days of trade in clipper ships, but it will add a bit of fresh wind to the industry.



Prediction of more shipments of export cargo and import cargo in international trade.

Bullish on Exports to Mexico

I may be wrong, but 90 percent of President Trump’s trade rhetoric may just be pre-negotiating posturing. Keep in mind that developers are master negotiators. For example, if building a 700,000 square foot project, they may ask approval for one million square feet knowing that the other side feels like they scored a “win” by chiseling the project down to 700,000 feet.  But if the developer started out asking for 700,000 feet, they may only end up getting permitted for 500,000. Could that be what’s on President Trump’s mind when he declares NAFTA is going to need major rewrites?

I’d like to think so. We import $59 billion more in goods from Mexico than they import from us. More importantly, Mexico imports $143 billion more in aggregate from other nations than they import from the US. Assuming they can source these same goods from the US, this means that there is $84 billion in wiggle room for Mexico to increase their imports from the US. Now, if you are President Trump, what are “best practices” for negotiating an increase in that delta? Answer: You first have to get them to think you are serious about cutting off their exports, otherwise they have very little incentive to play ball.

Interesting to note is that for this strategy to work, people have to work themselves up into nothing short of a “trade hysteria,” which they have. And the irony of ironies is that the media has played right into the President’s hand. By running around with their hair on fire, the media has set the stage Trump may have hoped they would, namely that Mexico (and some in the trade industry) actually believe he will go through with it, which may be the scenario he needs to successfully negotiate. We have never had a president who is as skilled in business – or the art of the deal – as President Trump. As they say in China, this is his rice bowl. Now if President Obama had said these things I would be worried because he had zero business experience and did not believe in American exceptionalism. My prediction? US exports to Mexico will grow by $20 billion over the next several years.


It’s been said that New York City is America’s business capital, but now that President-elect Trump is heading to the White House, look for that moniker to transition to Washington, D.C. Not only will we soon have a businessman running the country, but trade is top among his agenda items which can only mean increased trips to the nation’s capitol for global traders.

So where to stay? Let’s settle that question for you. Having recently checked in to the sparkling new Trump International Hotel, Washington D.C., I can say without hesitation that it is one of the most magnificent hotels in any city, anywhere in the world. I know, I know, that’s quite an endorsement—but it is true nonetheless. Let’s run down the list, shall we?


The Trump International has an A location right on Pennsylvania Avenue, just a few blocks from the White House and across the street from the Smithsonian Museums. It’s a short walk to everything.


The outside of the building is as dramatic as it is historic, being the former HQ of the U.S. Post Office. Originally completed in 1899, it quite frankly is the most architecturally stunning building in all of Washington, D.C., monuments excluded. Chief among its many beautiful features is the imposing clock tower.


When you enter such an historic building, you would expect the lobby to be equally impressive. Wrong … the lobby is even more impressive and is certainly the most dramatic of hotel lobbies to be found anywhere. I was immediately struck by the cool vibe; it was at once “businessy” but also equal parts elegant, welcoming, exciting and quite frankly, very fun. The signature feature has to be the dramatic open ceiling rising eight stories and covered by a skylight the size of a football field and girded by original steel trusses that add a distinctly historic element. That said, there are intimate conversation areas sprinkled throughout the lobby, which is anchored at one end by a dramatic bar and at the other end by the fabulous BLT Prime restaurant, with indoor elevated terrace seating overlooking the length of the grand lobby. On each side of the bar is a huge TV screen tuned to what else? Fox News. On the evening I stayed there, it was three days before the election and rather appropriate that Trump himself was being interviewed on TV when I walked in, almost as if on cue. Back to the lobby: The décor is what you might call updated colonial. The bright fabric furniture is comfortable and soothing, which is just what weary executives and tourists alike require at the end of the day.


Helpful, friendly, courteous, kind, diligent, cheerful. Sounds like I’m describing the Boy Scout slogan. The service is not overdone, nor do you have to wait more than three seconds to get someone’s attention. It was perfect.


I had breakfast at BLT Prime and came back for lunch it was so good. It bills itself as a steakhouse, but it is so much more. The menu offers a robust variety of favorites with a nice mix of some more exotic dishes that are sure to satisfy anyone at your table.


The rooms at the Trump International D.C. are, in a word, elegant. I don’t care for the super modern look that many 5-star hotels are going for these days. They leave me cold. The Trump, on the other hand, is what I would call stately elegant, right down to the crystal chandelier over the center of the room. There is rich, thick crown molding, nice artwork on the walls, but above all, the bed is the most comfortable I have ever slept on and the sheets and comforter would rival anything you might hope to find at Buckingham Palace. Someone had a big expense account when they purchased all these beds and linens. They are magnificent.

So there you have it. Kudos to Ivanka Trump for creating such a splendid property. Neither snow nor rain nor heat nor gloom of night will keep me from returning to this Trump “Old Post Office” Washington, D.C. n


Some people who have worked hard their entire life retreat to the golf course or get themselves a little beach cottage and park themselves on the sand for their retirement. But when you’ve been a four-term congressman; Counselor to the President; U.S. Ambassador to NATO; White House Chief of Staff; CEO of pharmaceutical giant G.D. Searle; CEO of General Instrument; Chairman of Gilead Sciences; and Secretary of Defense … twice—am I forgetting anything?—you’re always on the hunt for some new mountain to climb, regardless of age.

Chasing small white balls around green fairways was never in the cards for Donald Rumsfeld’s retirement. No sir … he had to find something as intellectually stimulating as the varied career he’s been blessed to enjoy. And find it he did when he partnered his foundation with the Central Asia-Caucasus Institute at Johns Hopkins University’s School of Advanced International Studies (SAIS) to establish the Central Asia-Caucasus Fellowship Program. Agreed, that’s a mouthful, so let’s break that down. The mission of the program is to bring bright, up-and-coming leaders in both the private and public sectors from Central Asia, the Caucasus, Afghanistan and Mongolia—10 countries in all—to Washington, D.C., to pursue research projects, connect with one another and establish ties with their counterparts in the United States.

Think of all the interesting people a guy like Rumsfeld knows and you’ll get an idea of the caliber of folks the Fellows get to interact with during their six-week program. Who wouldn’t want to sign up? Since the program’s inception in 2008, there have been 17 Fellowship Sessions and 158 alumni of the Fellowship Program. I met the most recent Fellows in early November and found them to be everything their impressive bios said they were. They were smart, focused and full of optimism for their respective countries. They were also very focused on business opportunities and developing a variety of commercial ties ranging from cattle feedlots to phone apps to fast-food franchises.

We caught up with Secretary Rumsfeld for an interview at his office a few blocks from the White House. Now 84, he is pretty much just as he appeared on TV at his last press briefing in the Pentagon 10 years prior. He greeted me sporting a tie and dressed in a fleece vest, which he no doubt wears around his home in Taos, New Mexico, and at his ranch in Montana. I found him easy to converse with—personable and engaging and with a good sense of humor—sort of like talking with a favorite uncle you haven’t seen in five years.

LAWLER: The need is great worldwide. You could have chosen to work with emerging economies in South America or Southeast Asia. Why did you choose to work with this region?

RUMSFELD: One day I was in Lithuania meeting with their president, Valdas Adamkus. He looked at me and said, “You don’t remember me, do you?” And I said, “No.” And he said, “Well, in 1962, you were running for the U.S. Congress on the Republican ticket, Cook County, Illinois. I was running for Trustee of the Cook County Sanitary District. You won and I lost.” I said, “You lost? My goodness, you’re President of Lithuania now.” Adamkus had gone back to his home country and become president. As a wrestler on our high school team, we had many kids whose family ties were from Eastern Europe. The point being that many people in the U.S. had strong linkages to people in Eastern Europe so when the Iron Curtain came down family and friends reached out to help.

LAWLER: So you have an affinity toward that region because some of these folks were your neighbors growing up as a kid?

RUMSFELD: Well, not that region. It was Eastern Europe we had an affinity with. We didn’t have many Mongolians or Uzbeks or Kazakhs in the U.S. But since I had a good deal of experience with those countries during my time in government, I thought, “Well those countries are making that same journey as our Eastern European friends had from Communist systems to freer political and economic systems, so we should make an effort to connect with them and be supportive.” During my time in government I spent a good deal of time in the Greater Central Asia region. And I recognize that that part of the world is not really on the radar screen in the U.S., so we decided to see if we could do something through our foundation that would acquaint rising leaders from those 10 countries with the United States and provide some linkages, so we started the Fellowship Program.

Then one day, Dr. Fred Starr from Johns Hopkins said to me, “You know, your idea was a good idea but what has really happened is something larger!” I said, “What?” He said, “Well, the Fellows have created the first real network of young leaders doing important things in those 10 countries.” Prior to this, people from those countries didn’t talk to each other much or visit each other’s countries. Now, if one of their friends visits from Kyrgyzstan for example, they’ll call all the Fellows and have dinner with them. Now for the first time they are talking back and forth and doing business deals and having government discussions.

LAWLER: On that note of business deals, you don’t read a lot about these 10 nations producing innovators in business or industry. Have you found entrepreneurial DNA in the Fellows?

RUMSFELD: Absolutely. And they’re very interested in starting enterprises. Just last night one Fellow told me at dinner about his idea for a consulting group representing all of the countries so that someone from outside their region could connect with their network with extensive linkages to people doing entrepreneurial things in each of the 10 countries. In effect, it would be one stop shopping for outside business people interested in the region.

LAWLER: You mentioned networking. What types of U.S. companies have shown the greatest interest to interact with the Fellowship Program so far?

RUMSFELD: Our groups of Fellows have met with a variety of U.S. businesses and some Fellows have individually been able to make useful business connections through the program, although any business connections that are made are up to the individuals themselves. However, eventually a thought is that our annual conference could become like the annual electronics meeting in Las Vegas where if you’re in that business, you want to be there. People will figure out that this network of talent is important. They start out ages 27 to 40, now they’re 27 to 49 (as the program is in its ninth year). And the Fellows are moving up in their fields—business, government, the academic world and the like. In terms of types of U.S. companies, if you think about it, law firms are interested in this part of the world, investment bankers are interested in this part of the world … and, of course, there’s the agriculture and energy sectors.

LAWLER: What has been the biggest surprise so far since you developed this program?

RUMSFELD: One of the side benefits of our program is that the important and involved people in the U.S. our Fellows meet with are paying more attention to that part of the world. But the real value and surprise is the networking among the Fellows from the 10 nations. They are discovering that that region as a whole has much greater heft than any of the 10 individual countries do.

LAWLER: How can a U.S. company tap into this network and the introductions to the region that the network can offer? Who would they contact? How do they get involved?

RUMSFELD: They can get in touch with our foundation’s executive director and start with the foundation website, Then they might consider attending one of our annual conferences hosted in one of the 10 countries where we have panels on a variety of topics. Another thing we can do is when CEOs come to D.C., if we have a group of our Fellows in town we can introduce them to the Fellows. So if there is someone who has an interest in that part of the world, we might have our group of Fellows meet with them. Additionally, if a company has an interest in a particular sector or country, we could link them up with our alumni working in that sector or active in a certain country.

LAWLER: Have you come across any importing, exporting or any foreign direct investment success stories as a result of participation in the program?

RUMSFELD: That certainly exists, but of course it’s all anecdotal. Our office is not engaged in it except as a facilitator. That said, through fellowship connections, we have seen companies consider opening branch offices or activities in neighboring countries.

LAWLER: Most Americans know the name Don Rumsfeld from your years of public service but a lot of people don’t know that you were the CEO of some very successful public companies. Be honest now, which did you enjoy more?

RUMSFELD: There wouldn’t be a Rumsfeld Foundation if those companies hadn’t done well! I have enjoyed doing both. I love learning—I loved flying in the Navy. I also enjoyed serving in Congress and in the Executive Branch. Running a pharmaceutical company was quite an experience. Life has been good.

LAWLER: As is probably typical, you seemed to drift in and out of private industry based upon whether the Republicans or the Democrats were in charge of Washington, D.C.

RUMSFELD: I ran Searle, the pharmaceutical company, for I guess eight or nine years, and then I was …

LAWLER: Wasn’t that, though, during the Carter years?

RUMSFELD: It was. When President Ford lost, I went into business. But I stayed in business for 20 years. I ran General Instrument Corporation and Searle and was the chairman of Gilead Sciences. Now, while I was doing that I also did a number of tasks in government. I chaired the Ballistic Missile Threat Commission. I was Reagan’s special envoy for the Middle East. I chaired the Space Commission. For some of these postings I had to take a leave of absence. I also chaired Gilead Sciences for many years, almost from the time it started. Those companies did well and I loved being in business. Business is fascinating.

I like doing different things; working with different people who have different backgrounds, different experiences, different interests. If I am learning, I’m enjoying life.

LAWLER: Your Pentagon news conferences or press briefings were legendary for your ability to think quick on your feet and also for your perspectives.

RUMSFELD: [Chuckling] I have no idea how all those things came out of my mouth.

LAWLER: Along that line, I want to run five names by you for you to just give me a quick observation about each. Ready? Let’s start with Richard Nixon.

RUMSFELD: Strategic. Personally a bit awkward with people … not easy socially, but intellectually focused and attentive to people of talent.

LAWLER: Henry Kissinger.

RUMSFELD: He’s a friend, is brilliant and tough. We go to his birthday party every year in New York.

LAWLER: Condi Rice.

RUMSFELD: Accomplished. Academic.

LAWLER: Colin Powell.

RUMSFELD: Successful. I’ve never dealt with him in business, only in government, and he’s more effective in-person.

LAWLER: Last one: George W.

RUMSFELD: Very different from his father. The country was fortunate he was there on 9-11. Solid, steady.

LAWLER: This might seem like a political question but it’s really, quite frankly, a trade question. If you were president, would you secure the Mexican border and build the wall?

RUMSFELD: I think the concept of the “nation state” is not talked about, understood or valued as much as it should be. It enables the world to have people live different lives, with different cultures, different languages, different approaches, different values, and accept the diversity that exists in the world. If you don’t secure your borders, you don’t have a country. There’s a big difference between people asking to come to our country because they want to assimilate and be a part of our culture and our history and people who come here because they’re fleeing and afraid to stay where they are—not because they value our culture—but because they’re fearful for their lives and for their families. Instead of intending to assimilate and be a part of our culture, they may come and wish to bring with them a culture that’s notably different. Our country has benefited enormously from people coming from across the globe—but, they’ve come largely because they value what we were trying to do here. So I do believe that it is important and proper for our country and any country to decide that people should come in legally, not illegally, and preferably because they share our values.

LAWLER: I’m going to move the conversation to China. China has tens of thousands of entrepreneurs selling products to world markets. How do you see their entrepreneurial prowess coexisting with a Communist regime in the future?

RUMSFELD: I think one has to recognize the reality that if a nation wants high growth, as they do, they’re likely to have to compromise on their political system. It is difficult to have a command economy and a controlled dictatorial political system and simultaneously get the kind of growth that requires people with iPhones and iPads and the ability to access computers and to interact with the rest of the world on a relatively easy basis. So it is possible they’ll hit a fork in the road and something may have to give. Either they’ll make compromises on their authoritarian Communist political system or they’ll opt for a somewhat freer political and freer economic system that may be needed for greater growth and opportunity.

China’s got some challenges; they still have many government corporations that are inefficient, and when they try to change them they have political unrest and they have to bring in security people. There is sizable disparity between economic progress on their coast and the inner portion of their country. They have a problem trying to solve the nonsensical “one baby” policy they had in that they could end up with 30, 40, 50 million men with no women. They have problems on their borders in the north and the south. Let me show you an illustration of the problem.

LAWLER: (Rumsfeld holds up a satellite photo of North and South Korea taken at night that shows lots of lights over South Korea but hardly any over North Korea.)

RUMSFELD: Here’s possibly the most important photograph I’ll ever see. That’s the Korean peninsula, with the same people north and south—same resources, same culture, same language, same neighbors. People are starving up in the north. That’s Pyongyang, just a pinprick of light. This satellite picture shows the energy in South Korea, now the 13th or so largest economy on the face of the Earth. The only differences are the political system and the economic system. China may hit a fork in the road and something may have to give. Who knows what it will be but repression works, obviously. It is possible to be successful in preventing people from having opportunities and causing them to starve and continue it for a long period of time, as they are in North Korea.

LAWLER: Some years back the post office came out with a stamp with the words “Global peace through global trade.” When you were running the Pentagon, did our global trade strategy influence our national security strategy? Were the two ever mentioned in the same sentence?

RUMSFELD: Oh, sure. There’s no question but that your relationships with countries where your trade is extensive are different from countries where it is not extensive. There’s familiarity, there’s more knowledge of languages where you have extensive trade. On the other hand, that might be a little simplistic. Think of our once extensive interaction with Cuba. We had all kinds of interaction—legal, mafia, economic, travel—going on pre-Castro during Batista. Then Fidel Castro came in and all of that interaction ended. So trade is good because people do different things better than others and at different times in their evolution. And we can benefit everybody in terms of jobs and opportunity if done well—not free but fair and balanced. But I don’t think trade necessarily leads to peace.

LAWLER: Sometimes it can foster peace and sometimes trade will agitate peace.

RUMSFELD: It can. If one asks, “Will the world be a better place?” Are countries likely to be better off if they interact with their neighbors in multiple ways, socially and economically? The answer is probably yes, but it’s not a certainty.

LAWLER: Is Putin a good guy or a bad guy?

RUMSFELD: Putin is what he is. He’s a KGB operative who grew up in that environment and is authoritarian by nature and by background. He is anything but a democrat. He does not get up in the morning and ask himself how I as a human being—or my country—can influence and contribute to a world where more people will have opportunity and better lives. He gets up and thinks about how he can reconstitute the old Soviet Union and how he can assert his aspirations of empire. Someone asked me the other day, “What will Putin do next?” My answer was, “Whatever he believes he can.” He’s going to do that which he thinks he can do without any major penalty. I have a high tolerance level for differences (among nations). Our country is different today than it was when it began and even than when I was born. The U.S. had slaves in this country into the 1800s. Women didn’t vote until the 1900s. And if you look forward 50 or 100 years, we’re going to be still different. So we have a template and what we have now is pretty darn good, but it isn’t the same as we had and it isn’t the same as it’s going to be in the future. And it sure as heck isn’t a template to be pressed down on other countries, nor should our expectations be that every country be exactly like us. Our definition of “good” too often seems to be to “do what we do.” That’s silly because what’s good in a different country at a different point in its evolution can be quite different from what we’re currently doing.

So the idea that our government should be judgmental and that if people aren’t behaving exactly as we are, we should put a stick in their eye, is nonsense.

LAWLER: What book are you reading right now?

RUMSFELD: I just finished a book called The Last Option about Israel written by David Kimche, who I worked with when I was President Reagan’s Middle East envoy. He was an ex-Mossad leader who became director of Israel’s Foreign Service. He did some of their work in Africa and Iran and around the world. I found him a talented, interesting and a fine person to work with on various projects.

LAWLER: What person in U.S. history do you admire the most?

RUMSFELD: I admire people for different reasons and I don’t know if there’s anyone I would select out. I have to start at the beginning with George Washington in that he set this country on a path, not as a monarchy and not a permanent presidency for one person, but as a democracy. He understood the advantages of dividing the powers among executive, legislative and judicial branches and accepting the difficulties and deadlocks that can occur when you don’t have an authoritarian system. The advantages of our system vastly outweigh all other options. n


We think Manhattan or London real estate is expensive, but truth be told it pales in comparison to the square-foot cost to fly international business class. Think about it: Your “rentable” space may be what, three feet wide by six-and-a-half feet if you’re lucky? And for that you’re paying upwards of $3,000 one way? That comes to a whopping $157 per foot. And that’s not per year, or even per month—it’s per 12-hour period.

Yet for all the hype and costs, we all know that travelling to Europe or Asia in business class can make the difference between arriving feeling and looking haggard versus refreshed and ready for action. Why go all that way and have your mind numbed by jet lag? When negotiating deals of any size, it’s chump change to pay the extra $1,500 or $2,000 to fly business class (but let’s keep that between us and not let the airlines know, agreed?).

Okay, now that we have that resolved, the question is which airlines to take. We don’t always have a choice but when we do, it’s nice to have some facts fresh in your mind. I recently made several business class trips from LAX to Europe and have some unvarnished insights to offer.


I have to say, I was actually looking forward to flying Air France, thinking that I would be well pampered and even spoiled while humming along at 30,000 feet over the Atlantic. Truth be told, the business class seat was disappointing. It didn’t offer any privacy from the person seated right next to you. There was no “alcove” or “personal space” that was unique to the seat. In fact, it was just like sitting in a coach seat only wider and with more legroom. And while it reclined almost fully, for that kind of money I was expecting more.

On the other hand, the food did not disappoint. It was actually very good, and that’s saying a lot for airline food. And as you may expect of the French, they kept the wines and Champagne flowing throughout the flight. There were of course appetizers, starter courses and choices of entrees and a myriad of desserts to choose from. All were above average for business class airline food.

In business class, the flight attendants tend to be the cream of the crop. Their manners are more refined, their demeanor more professional and their level of service is elevated, as well it should be for the rates they are charging. Air France scored high marks in flight attendant service. Their wine steward had a good sense of wit mixed in with his professionalism. The flight attendants were all wonderful. Great manners, gracious hosts and hostesses, and they truly made me feel like I was in their home.

All around high marks for Air France’s food and service, but I ding them for their sub-par business class seat. Whichever airline bureaucrat made the decision to go with those seats should enjoy early retirement.


Speaking of business class seats, I have a bone to pick with American. On one flight to London, the business class seat was a 10. It did everything you would want a seat to do. I was able to fully recline, adjust the seat to watch movies, and it offered exceptional privacy. I could not hear or see the person sitting next to me. On the more recent flight, some airline designer decided to angle the business class seats diagonally. Bad call. I found that when reclined, because of the diagonal seat direction, my right shoulder was always bumping into the console and I could never get comfortable. And the seat was too narrow. It drummed up the adage, “If it’s not broke, don’t fix it.”

The food and service on American were both good. I didn’t get a white linen tablecloth to cover my tray. Maybe the local caterer forgot to put them on. But the meals were good, the choice of wines was excellent and the service was professional and attentive—nothing memorable, but that can be good, too. All in all, a very well run business class. But what I enjoyed the most on American was the huge selection of movies. And not just new releases, but an impressive sampling of old black-and-white classics. I chose Casablanca with Humphrey Bogart and was happy as a clam. Someone at American was thinking outside the box on their movie selection and for that alone they get high marks. Good job.


All I can say is that I was most pleasantly surprised flying Alitalia and would definitely choose them again if given the choice. I liked everything about Alitalia’s business class. Let’s run down the list. First, the seats were super comfortable and by that I mean wide, fully reclining into a flat bed and offering excellent privacy from the person next to me. In fact, there really is no person next to you as they are thoughtfully staggered. I had my own world.

The movie selection offered some older movies—no black-and-whites like American—but still a nice sampling of old and new. The supplied headphones were comfortable and provided good quality sound. Even at lower volume, the rest of the plane noise disappeared. Again, I was in my own zone and the seat was happy to be adjusted into any number of comfortable configurations for watching movies or reading.

The French love their food but so do the Italians. On this leg, the flight was from Rome to NYC so the caterer was Italian. And yes, the food was attractively presented and even delicious. White linen tablecloths and starched napkins completed the ambience. Italians make the best breads. They just do. And on this flight we had our choice of delicious breads followed by a wonderful selection of starters and main courses. The service was great, on par with Air France, and when combined with the quality of the seats and the absolute privacy they afforded, Alitalia gets my highest marks. It’s an exceptionally well-run business class. 


China’s raw material play in African nations is morphing into a diversified trading scenario. Never mind that they’ve been getting kudos on the world stage for making substantial investments in rail and highways, something they needed to do anyway to get Africa’s raw materials to Chinese ports. They are now picking up additional “attaboys” for expanding traditional trade categories, such as a growing market for Chinese autos and a whole host of affordable Chinese products. And do you think any of these African nations are hassling them for currency manipulation or “dumping” cheap exports onto the scene? Far from it, they are rolling out the red carpet, no pun intended. From a geopolitical perspective, Chinese involvement in Africa will most likely prove to be a stabilizing factor. While they are Communists, at least they’re not radical Muslim extremists. In fact, you could refer to them as “CINOs”—Communist in Name Only—as evidenced by their devotion to entrepreneurism.

Should Great Britain (or are they still calling themselves the UK?) leave the E.U.? That’s up to them to decide. But in general, the E.U. is a breeding ground for more government regulation which can only lead to stalled commerce. Aren’t things slow enough as they are? And don’t forget to factor in national pride. Something is lost when you try to homogenize the colorful nations of western Europe. Britain should pull for Britain, Denmark for Denmark and Germany for Germany. And speaking of E.U. trade, the independent consultant hired to evaluate the ramifications of a U.S.-E.U. trade agreement recently announced in a 400-page report that all member states’ economies would grow as a result of a new trade agreement. I think a more realistic assessment would be that all member states’ economies would grow despite the new trade agreement. It sounds good on paper, but the implementation of it won’t work. With 29 countries involved, nothing will get done. There will be constant violations, constant appeals and constant talk with no action. As we have always maintained in this column, bi-lateral free trade agreements—which are challenging enough to implement—are the way to go. Anything above that is just political rhetoric.

Maybe the folks to ask about the benefit of E.U. free trade are English fishermen. Nutrient rich currents of the North Atlantic collide with the gulf stream to give England a prolific saltwater fishery.  English waters are far superior to Spain’s, France’s or Germany’s. But since the creation of the E.U., they’ve lost control of the northern and western fishery inside their 200-mile economic zone, which they now have to share with other E.U. nations. As a result, the waters are being over-fished and English commercial fishermen are finding themselves out of work. Life—and global trade—was better when England had an abundance of fish and could export their catch to the rest of the world. Now other E.U. countries can just come into their territorial waters and take the fish for themselves. That’s not trade—it’s E.U. socialism. A recent New York Times article summed up one English fisherman’s feelings on the Brexit debate like this: “‘I definitely want out,’ said Michael Sharp, an English fisherman, crossing his arms defiantly. ‘All those wars we’ve had with France, Germany—all the rest of them since God knows when, since Jesus was a lad—we’re never going to get on with them, are we?’”

In business—and especially global trade—you vote with you feet, so kudos to Caterpillar Chairman and CEO Doug Oberhelman for leading his company and a local CAT dealer on a trade mission to Cuba. CAT has been beating the drum for 20 years to end the trade embargo with Cuba and knows how to grease the skids. Feel free to take notes here. At a reception with Cuban officials and CAT execs at the former island home of Ernest Hemingway, Oberhelman gifted a new CAT skid-steer loader to a local charity. Nice touch and a generous way to say we are serious about doing business in Cuba.

Most national governments encourage companies to do well in business and some even provide economic assistance to grow business. Not so the Obama Administration, which seems to look for any way possible to fine companies. In the latest example: The Federal Maritime Commission (FMC) announced that it has levied $840,000 in civil penalties with five ocean transportation intermediaries. The intermediaries included both non-vessel-operating common carriers (NVOCCs) and freight forwarders. In a self-aggrandizing statement, FMC Chairman Mario Cordero said, “The agreements and penalties demonstrate our staff’s dedication and continuing commitment to protect the American shipping public.” Really? Tuesday, Nov. 8, cannot come soon enough.

Fools Rush In

I can’t help but think of the song title “Fools Rush In” when considering the stampede of European companies eager to invest in Iran. Peugeot wants to ante up 300 million euros to start building cars in Iran. Italian companies have inked deals with Iran totaling $18 billion. And that’s just for starters. Iran’s President Rouhani is just ramping up his European dog and pony show and is scheduled to ink billions more with French companies in the weeks to come.

Really? I don’t get it. Next to North Korea, Iran is probably the world’s most untrustworthy regime. And this one takes the cake. … French airport operator Aeroports de Paris and Bouygues SA are expected to design and construct a new terminal at Tehran’s Imam Khomeini International for “expanded tourism opportunities.” The name says it all. Who’s going to plan a vacation in Iran, which has a history of snatching people off the street and holding them for ransom? Lest we forget, following the 1979 revolution, Iran nationalized all companies. With that in mind, here’s an axiom to consider: History repeats itself. Or as Karl Marx restated it, “History repeats itself first as a tragedy, second as farce.” To these Italian and French companies I have only this to say: Good luck.

No one is more bullish on free trade than us. But don’t expect the 12-nation Trans-Pacific Partnership that the U.S. is expected to sign shortly to do much of anything to help U.S. workers. In fact, a recently released report states that up to one-fifth of U.S. manufacturing jobs could be replaced by an increase in cheaper exports from Vietnam and other low-income countries in the bloc.

Recalling Nancy Pelosi’s famous words, “We have to pass the bill so that you can find out what is in it,” the Obama Administration has tried to keep details of the proposed trade pact a secret, much as it did with the healthcare law. From their perspective it’s understandable. The proposed trade agreement plays into his mantra that America has exploited the world so it’s only right that we level the playing field for all countries because when it comes to capitalism, no good deed goes unpunished. Thank you sir, may I have another?

Like it or not, the climate change debate is only going to intensify as we march into the remainder of the 21st century. Multinational companies that don’t play ball, or are perceived as not doing enough—fast enough—to reduce their greenhouse emissions throughout their supply chains could find themselves shut out of some European markets. If your strategy is to let the early adapters with deeper pockets figure it out and then emulate them later, then that’s your strategy. But you may find yourself implementing it at a cost of eroding market share.

Amazon is taking the first step to become a China Trader but—for now—not the kind that used to own its own fleet to carry its own goods. In a move to give the company more control over the goods it imports from Chinese factories, the online retailer is registering to become a NVOCC. Interesting move. Can owning or leasing their own container ships be that far behind their reported plans to lease up to 20 Boeing 767s to handle their own air freight?

Gateway To The Pacific Rim

It’s no secret that the greater Los Angeles area sits at the gateway to the Pacific Rim with its deep ties to Asian markets. But do you really want to have your next Southern California-based conference or meeting at a traffic-clogged location? Let me answer that for you: No, you do not.

Let me introduce you to Newport Beach and in particular its grand dame of resorts, the Balboa Bay Resort. It’s just 45 minutes south of LAX; or if you fly into Orange County airport, you’re already there. Back in the ’70s, John Wayne played cards at what was then the Balboa Bay Club every week with pals Andy Devine, Joey Bishop and Ward Bond (if you don’t know who Ward Bond is, you don’t watch enough old John Ford movies). Today, the Balboa Bay Resort continues to enjoy its rich heritage but does so with sparkling new construction. But what truly sets it apart from other five-star resorts is its “position A” location right on spectacular Newport Harbor.

Step out onto your balcony overlooking the bay and you can experience the thrill of watching big racing sailboats come within inches of colliding as they tack up the harbor, their jibs whipped by the wind. The sunrises and sunsets aren’t too shabby either. Yes, the location is sure to impress your clients and employees. But even more importantly, the impressive tech-savvy meeting facilities and well-trained staff will make sure your meeting comes off without a hitch.

Governors Boardroom - HeroI’ve been to many events at the resort and can attest to its beauty and functionality. All told, business retreats and meetings can take advantage of more than 18,200 square feet of flexible event space, as well as 12 breakout rooms with bay views and flexible configurations. For outdoor events in Newport’s mild year-round climate, the resort offers an additional 6,000 feet of outdoor event space for a total of 24,200 feet.

Let’s take a quick tour, shall we?

The Grand Ballroom offers 7,000 square feet of indoor space for up to 450 guests. This impressive venue is illuminated with five grand chandeliers and 18-foot-tall ceilings and also offers a light-filled 1,100-square-foot, pre-function area.

Just outside the Grand Ballroom, there is a 2,610-square-foot Bay Front Lawn, ideal for outdoor banquets and events along Newport’s beautiful harbor.

Adjacent to the ballroom foyer is the Coconut Grove, a 2,500-square-foot outdoor terrace ideal for receptions, cocktails or pre-function mingling.

ROOM WITH A VIEW Commodore Room is a private meeting room right on the water with 2,025 square feet of venue space for up to 50 guests.
ROOM WITH A VIEW Commodore Room is a private meeting room right on the water with 2,025 square feet of venue space for up to 50 guests.

The Commodore Room is a private meeting room with 2,025 square feet of venue space for up to 50 guests. Located right on the water, this venue offers waterfront views, as well as an outdoor terrace. A more intimate venue with 1,512 square feet of event space for up to 40 guests is the Quarter Deck Room, ideal for business conferences and meetings.

Looking for an ideal place to host your top executive team? The Governor’s Boardroom is a luxurious 14-seat meeting venue with a large mahogany table, plush chairs and water views. With a setting like that you can actually look forward to the meeting lasting all day. There are lots of other meeting rooms offering a variety of table and seating configurations. If you can envision it, they can make it happen. Or better yet, just tell them who’s coming, what your meeting goals are and let their team envision it for you. With 159 guest rooms and suites, a myriad of bars and restaurants and of course Newport Beach’s finest spa, you and your group will look forward to making the Balboa Bay Resort your own gateway to the Pacific Rim.

Full of Blarney

Of all the locales in Europe, Ireland is probably where most Americans will feel right at home. Whether you are Irish or not (and who isn’t on St. Patrick’s Day?), you will most likely have a number of friends of Irish or partial Irish descent whom you enjoy and are easy to get along with. You’ll find that same sense of familiarity and friendliness in Ireland. And if you are of Irish heritage, in a strange way you’ll feel as if you are going home, or at least back to your grandparent’s hometown.

Meetings start on time. If you’re 10 minutes late, it’s okay. If you’re going to be 15 minutes late you should call ahead, and if you’re going to run 20 minutes behind you should reschedule with your host. The Irish are not driven to the same degree that you find some people are in Southern California or New York City with their faster-paced lifestyles. The Irish take time for conversation. That said, they prefer to deal in facts and as a rule, they don’t have room for boasting or hyperbole … unless you are on your third or fourth Guinness and then a certain amount of blarney is allowed.

One thing the Irish do get edgy about is talking about their relationship with England. They still don’t care for the English, even though Cromwell invaded Ireland long before the English invaded the colonies. Hey, we got over it, but they haven’t. Despite the British waging war on us in 1776 and again in 1812, I have never met one American who harbors any ill will toward the British. Not so the Irish. In fact, another edgy topic for the Irish is their role in World War II, or rather their lack of a role. The Irish remained neutral in the war and even at times collaborated with the Germans. It’s not that they particularly cared for the Germans but as one waiter in Dublin told me a few weeks back, it’s a case of the old saying “the enemy of my enemy is my friend.” It’s not that they won’t talk about English-Irish relations or history, but if you’re trying to put a deal together you’re best off leaving that topic off the table.

As far as client entertaining goes, one of my dad’s favorite sayings is, “The reason God invented liquor is so the Irish wouldn’t rule the world.” I can say that because the Lawlers are Irish. But truth be told, while the Irish do like their pubs, I never saw anyone out of control or who looked like they had one too many. And that includes a visit to the Temple Bar area after a big hurling game had just concluded. (I never have understood the differences between field hockey and hurling, do you?)

No business trip to Ireland is complete without at least a couple of days of sightseeing and touring the countryside. If you’re going to get a rental car, keep in mind that they take things like door dings and scratches as a big deal if not an ancillary profit center.

Document every mark on your car with your own photos on your cell phone. And before making a turn—any turn—ask yourself at least twice, “Am I turning onto the correct side of the road?” I found it was helpful to conclude that I was wrong until I could prove otherwise. That method of thinking provided an extra layer of safety.

Blarney Castle: It is so imposing it will stop you in your tracks
Blarney Castle: It is so imposing it will stop you in your tracks

Dublin is a cool enough city. But after a visit to St. Patrick’s Cathedral and tour of the Temple Bar area, you’ll find much more interesting things to do and see outside the city. On our trip we headed south to Adare Manor, just outside Limerick, which is a fabulous five-star, castle-like manor home built in the 1800s adjacent to the site of the still standing but now-in-ruins Adare Castle. A number of things make Adare Manor so special. For starters, it is surrounded by a beautiful 18 hole championship golf course designed by none other than Robert Jones. Indeed, their pro-am held every couple of years attracts crowds upwards of 300,000.

That’s a lot of people watching golf. The staff was very courteous if not a tad formal, and the beautiful main dining room was run by a seasoned crew as well, which is something you don’t always find in hotel-run restaurants. The resort was recently purchased by JP McManus, reputed to be one of the wealthiest in all of Ireland. McManus plans to close Adare Manor for an 18-month renovation. I found it pretty nice as it was, so I look forward to returning one day to see what he does with it.

Next stop for us was Blarney Castle. I have to inject a disclaimer: I was travelling with my 24-year-old daughter who saw someone kiss the Blarney Stone on The Bachelor, so naturally it was on our bucket list. That said, it was my favorite side trip. Blarney Castle is everything you always imagined a 600-year-old Irish castle would look like. When you first come upon it strolling through the castle grounds, it stops you in your tracks. It is truly imposing. I couldn’t believe how tall it was for starters. And built so many hundreds of years ago and yet every stone is so secure in its place. I found myself about 8 years old all over again climbing up, up, up the seemingly endless circular stone steps to the Blarney Stone itself, which sits rather precariously over a ledge in such a way that the only way to kiss it is to invert yourself with the assistance of a volunteer.

As legend has it, the Blarney Stone is said to be half of the Stone of Destiny, which is the stone that ancient monarchs of England and Scotland we crowned upon (the other half is under lock and key at Edinburgh Castle—see this issue’s Soundings column for more scoop). Supposedly the Scottish king Robert the Bruce gave half of the stone to the then-owner of the Blarney Castle as thanks for his support in some long forgotten battle. Prior to that, some say the Stone of Destiny was originally brought to Scotland by the Knights Templar as a souvenir from a crusade and that it, in fact, was the very stone that Jacob laid his head against as told in the Old Testament.

If that sounds like blarney to you, well, you get the idea.