US and China announce new tariffs

President Trump announces his administration will retaliate against China by raising tariffs on Chinese imports amid a bitter trade war between the two countries; reaction and analysis from the 'Special Report' All-Stars.

This is a rush transcript from "Special Report," August 23, 2019. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

PETER NAVARRO, WHITE HOUSE TRADE ADVISER: We know they are killing Americans with Fentanyl. We know they manipulate their currency. So when Americans understand that, and then when China tries to bully us, that only strengthens our resolve. The negotiations will continue behind closed doors. We are going to resume those talks in September.

SEN. BEN CARDIN, D-MD, SENATE FINANCE COMMITTEE: I am very concerned about this trade war. It's certainly hurting our economy. The way the president's handling these trade negotiations is not in our economic interests. It's clear that China has violated trade rules, but the United States has isolated ourselves with our traditional trading partners.

(END VIDEO CLIP)

BRET BAIER, HOST: This is a big back-and-forth day. The Chinese announced $75 billion of additional tariffs. The Dow took a major hit when the president responded to that on Twitter, and a series of tweets after that. And then late in the day, the president said he, in fact, was going to increase the tariffs on the Chinese on hundreds of billions of dollars of goods.

Let's bring in our panel, we'll star there, Matthew Continetti, editor in chief of the "Washington Free Beacon," Susan Page, Washington bureau chief at "USA Today," and Jason Riley, "Wall Street Journal" columnist and senior fellow at the Manhattan Institute. There's a lot of just volatility, there's a lot of uncertainty, and the markets don't like that.

JASON RILEY, "WALL STREET JOURNAL" COLUMNIST: Exactly. And neither do CEOs of companies. They want stability. And they are not really worried about monetary policy, Bret. I don't think they are worried about another basis point on the interest rates. I think they are worried this trade war. I think that's what CEOs, they don't know whether they can invest, they don't know whether they can hire, they want certainty. One day the president comes out and says we need to cut the payroll tax, we need to index capital gains, the next day he walks it back. That is the last thing the markets want to hear. That's uncertainty to them, and I think it's hurting.

BAIER: The president tweeted about the Fed. "As usual the Fed did nothing." It wasn't a Fed meeting today. It was a speech by the Federal Reserve chair out of Jackson Hole, but, "It is incredible they can "speak" without knowing or asking what I'm doing, which will be announced shortly. We have a very strong dollar, a very weak Fed to. I will work "brilliantly" with both and the U.S. will do great. My only question is, who is our bigger enemy, Jay Powell or Chairman Xi?" Here is the president just a couple weeks.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT: We've been losing hundreds of billions of dollars to China. It has to stop, and they understand that. President Xi is a good man, he's a friend of mine, he understands that. And until such time as there is a deal, we will be taxing the hell out of China.

(END VIDEO CLIP)

BAIER: He's talked about it for a long time, but he's a good friend or is he an enemy?

SUSAN PAGE, WASHINGTON BUREAU CHIEF, "USA TODAY": I think you can justify calling the president of China an enemy, and we are in an economic competition with them, the two biggest economies. Hard for me to understand why you call the chairman of the Federal Reserve, who, by the way, you appointed to the job as an enemy and liking him to the president of China. And maybe I'm easily shocked. I did find that shocking today.

BAIER: There are a lot of supporters, Matthew, who say let's stick with it. Let's stick it to China because they've been sticking it to us. You hear that around the country. There's feeling, like there's worry, but they also say, go get them.

MATTHEW CONTINETTI, EDITOR IN CHIEF, "WASHINGTON FREE BEACON": That's right. And to date, the effects of the trade war are showing up more in the stock market than they have in, say, the employment figures, which I think are critical to President Trump's chances for reelection. But all of this is a reminder that the only closed economy, Bret, is the global economy. And so this trade war has affected the Chinese economy, which in turn has affected the German economy, which brings down Europe, and that is having blowback now in terms of our businesspeople operating in this climate of uncertainty. They don't know actually where the supply chains will go, and they don't know where the tariff levels will remain.

RILEY: And I think that's why, and I think Trump knows it's having an effect. That's why he's subsidizing farmers who are responding to retaliatory tariffs from China. That's what he wants to delay some of these trade sanctions until the Christmas shopping season is over. He knows it's having an effect.

BAIER: I should point out that Japan is saying that North Korea appears to have fired a ballistic missile. We're just getting word about that over the wires. We will monitor that. It would be after several of these tests have happened in recent weeks.

We are going to take a road down the 2020 Candidate Casino. There are fewer to bet on this week, but you have $100 in chips. You have to make bets. Susan?

PAGE: I put $40 on Elizabeth Warren, $30 on Joe Biden, $20 on Kamala Harris, and I put $5 each on Cory Booker and Amy Klobuchar.

BAIER: You've got Warren ahead of Biden. OK, Matthew?

CONTINETTI: I put $50 on Biden, $30 on Warren, and $20 on Sanders. But after today's stock market, I want to put it all on gold.

BAIER: All on gold, all right. Jason?

RILEY: Its' $35 on the Biden, $30 on Warren, $15 on Sanders -- I'm sorry.

BAIER: yes.

RILEY: Yes, $15 on Sanders, Harris $10, and Buttigieg $10. I think Biden is feeling pretty good after a couple of lackluster debate performances, not defending his record very well, the crime bill, Hyde amendment, bussing, and so forth. And he's ahead. He's ahead in Iowa and he's ahead nationally.

BAIER: Can we do -- no, we can't. Yes, we can. Winners and Losers really quick.

RILEY: My winner is Joe Biden who rebounded in the latest polls and who has seen three of his rivals for the nomination drop out in the last couple of weeks. My loser is Elizabeth Warren who continues to insult both Native Americans and American intelligence.

PAGE: My winner is Greenland. When would we ever pay so much attention to the biggest island in the world? My loser, governors who want to be president. That's a traditional path to the presidency, but we've had two of the three governors, or four governors running for this nomination drop out in recent days.

CONTINETTI: Winner is Chuck Schumer. He has John Hickenlooper entering the race against Cory Gardner in Colorado, bringing him one step closer to becoming the Senate majority leader. My loser is the Chicago teachers union delegation to Venezuela. Clearly, these teachers flunked economics, government, and ethics.

(LAUGHTER)

BAIER: My winner is the panel for getting around the horn.

When we come back, "Notable Quotables."

(COMMERCIAL BREAK)

BAIER: It is Friday. That means "Notable Quotables."

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They are burning an enormous bonfire of Amazon logs that have been piled drying in the sun for several months.

UNIDENTIFIED FEMALE: Do you trust Kim Jong-un?

UNIDENTIFIED MALE: No.

UNIDENTIFIED MALE: These families and children are receiving hot meals. You are going to see children sitting in front of flat screen TVs watching cartoons.

UNIDENTIFIED MALE: I'm looking forward to getting away from politics for a while.

TRUMP: He raised interest rates too fast, too furious.

KELLYANNE CONWAY, COUNSELOR TO PRESIDENT TRUMP: This is nice to have the mainstream media finally covering the economy, but they only cover it when they can use Sesame's Grover word of the day, "recession."

UNIDENTIFIED MALE: BDS is a bull -- purity test by people who want to appear woke but actually slept through history class.

UNIDENTIFIED FEMALE: She said I'm her dream manifested. I am her free bird. So why would I come back and be caged?

TRUMP: If you vote for a Democrat, you are being very disloyal to Jewish people, and you're being very disloyal to Israel.

UNIDENTIFIED MALE: It's become clear that I'm not going to be carrying the ball, I'm not going to be the president, so I'm withdrawing tonight from the race.

UNIDENTIFIED FEMALE: I received the news that President Trump has canceled his state visit to Denmark.

TRUMP: Harry Truman had the idea of Greenland. I had the idea, other people have had the idea.

UNIDENTIFIED MALE: These people are wondering around the desert, taking a crap everywhere, dumping their garbage, setting fires.

UNIDENTIFIED MALE: I apologize if you'd ever got to know Donald Trump, but this New Yorker volunteers to get rid of him for you.

TRUMP: I am the chosen one.

(END VIDEO CLIP)

BAIER: That's one week in Washington, covering this place. Thanks for inviting us into your home tonight. That is it for this “Special Report,” fair, balanced, and unafraid.

A big FOX News Sunday this weekend with the treasury secretary and Amy Klobuchar.

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