This is a rush transcript from "On the Record," November 18, 2011. This copy may not be in its final form and may be updated.
GRETA VAN SUSTEREN, FOX NEWS HOST: And now, Donald Trump! He says our leaders are not smart. Here's Donald Trump.
VAN SUSTEREN: Are you for free trade or opposed to free trade?
DONALD TRUMP, TRUMP ORGANIZATION: I love free trade. I went to the Wharton School of Finance, the greatest business school there is. I was a nice student. I understand all about free trade and fair trade.
I'm for fair trade. These companies and these countries have smarter people than our leaders. Our leaders are not smart. I know you think that Obama's a genius. He's not. Our leaders are not smart and our leaders are being outnegotiated at every single corner. So our country is in big trouble.
And you know, the sad part is we can't continue to go on like this. If we go on like this much longer, Greta, we're not going to have much of a country left.
VAN SUSTEREN: Well, wouldn't free trade work in a very sort of pure sense if everyone -- if no one cheated?
TRUMP: Yes, but they cheat!
VAN SUSTEREN: Well, no, I'm saying...
TRUMP: I agree. I'm all for it!
VAN SUSTEREN: I (INAUDIBLE) so I mean -- so when we agreed -- when we got involved in free trade, what was our expectation, that -- were we naive to think that other countries wouldn't manipulate currencies?
TRUMP: We thought, and with some pretty smart people -- and this was years ago -- we thought that we would go out and take over the world. And it started that way. But then our leaders got dumber. Their leaders got smarter...
VAN SUSTEREN: At what point?
TRUMP: ... and all of a sudden -- not just with Obama, it started before Obama. It's worse now than it's ever been, but...
VAN SUSTEREN: In the Clinton...
TRUMP: ... it started before...
VAN SUSTEREN: ... administration?
TRUMP: Even in the Clinton administration. All of a sudden, the world started saying, Hey, wait a minute, we've got these patsies over there. They're not too good. We can sort of make product -- we can make product that they've always been making. And then you had NAFTA, where you look what happened to New England and lots of other places. I mean, to this day, you look at some of these empty factories, it's sad.
VAN SUSTEREN: Well, so...
TRUMP: And the products being made in Mexico?
VAN SUSTEREN: So was free trade a mistake?
TRUMP: I think free trade wonderful if you have smart leadership.
VAN SUSTEREN: All right, well, in recognition of the fact that, you know, we've got this huge imbalance, you're talking about calling for taxes or tariffs, which...
TRUMP: No, to abusers.
VAN SUSTEREN: To abusers.
TRUMP: Only to abusers.
VAN SUSTEREN: To abusers. OK, well, who's not abusing?
TRUMP: Probably nobody.
VAN SUSTEREN: OK, so we're talking about everybody.
TRUMP: Let me ask you this. Name one country that we do well with. Now, we used to be the king.
VAN SUSTEREN: I'm the one who said name -- you -- I asked you to name some -- tell me who's not abusing.
TRUMP: Oh. Well, I didn't realize that, but I'm just -- name one country. We're not -- we're not doing well with anybody. Colombia, OK, Colombia in South America. Not a big trading partner. They made $4 billion on us last year. Now, that's not -- you know, that's a lot of money.
VAN SUSTEREN: So where -- so where's the plus on this free trade for us?
TRUMP: I don't see it so far. I see it if we had the right people. You know...
VAN SUSTEREN: But you're talking about...
TRUMP: ... if Obama would call me...
VAN SUSTEREN: You're talking about a -- you're talking about a world where everyone is abundantly fair and open...
TRUMP: You know, that's why -- so it works at the Wharton School of Finance and your little glass...
VAN SUSTEREN: Exactly.
TRUMP: ... beautiful...
VAN SUSTEREN: Exactly.
TRUMP: ... classroom, it works. But in actuality, when you have some vicious, brilliant business leader, politician in China, and some vicious guys in other countries that are smarter than the people they're negotiating with, most of whom are diplomats and don't know what they're doing for this country -- they love free trade.
See, I don't call it free trade, I call it stupid trade. We used to be the smart ones. We're not the smart ones anymore.
VAN SUSTEREN: But...
TRUMP: You know, when this whole concept started, we were smart. I talk about I'm a free trader, but only if it's fair. I take criticism. I have people that are conservative people like me, and they say, Donald, you're talking about...
VAN SUSTEREN: Well, why do they like free trade if...
TRUMP: Because I don't think they know. Honestly...
VAN SUSTEREN: Why do they like it? You think they don't know?
TRUMP: Maybe they're not smart. I mean, it's so obvious. It's, like, maybe they're not smart. Maybe they're just robots that think, Oh, to be a Republican conservative, you have to believe in free trade. I believe in free trade but to do free trade, you need smart representatives. We don't have smart people in this country.
VAN SUSTEREN: Are Democrats in favor...
TRUMP: Representing us.
VAN SUSTEREN: Are Democrats in favor of free trade?
TRUMP: Some are. And some...
VAN SUSTEREN: Most are? Most?
TRUMP: And by the way -- some are, and some are frankly seeing that we're losing. We are losing our shirts with so-called free trade. We're losing our shirts, Greta! We're losing our jobs. We're not manufacturing anything. We're losing our shirts with free trade!
So at some point, my conservative friends are going to have to go back and say, Well, wait a minute, we can't continue to lose $300 billion, $400 billion, $500 billion a year with China. Look, China taxes our product. I don't know if you know that or not. But when you go into China and you sell -- we sell so little product to China, it's irrelevant anyway, relatively speaking. But when you sell product in China, they tax us. We don't tax them, they tax us. How come?
Look at the deals made with South Korea. They want to sell cars, they want to sell televisions, they want -- but we want to sell cars in South Korea, except they want to put a tax on us.
VAN SUSTEREN: Well, what's in it for us, then, to have all these trade agreements?
TRUMP: I just think the people that are doing them are either incompetent, or maybe more likely, are controlled by their local lobbyist, represented by South Korea. In other words, South Korea, China, all these countries have lobbyists in this country. And I really believe -- I look at some of the political decisions, decisions politicians make, and I say there's only one reason they can make those decisions, because lobbyists or somebody's (INAUDIBLE) because they can't be that stupid.
VAN SUSTEREN: So they're for sale.
TRUMP: Here's the thing. They can't be that stupid. If they're that stupid, we got bigger problems.
VAN SUSTEREN: Well, then, you're saying they're for sale.
TRUMP: I believe...
VAN SUSTEREN: You're saying they're for sale.
TRUMP: Yes, I believe they're absolutely 100 percent -- I don't want to be a nasty guy -- 100 percent sold and bought by their local lobbyist.
VAN SUSTEREN: Donald, thank you.
TRUMP: Thank you very much.