White House insiders and chief executives speaking at the Milken Institute's Global conference mostly remained optimistic discussing whether President Donald Trump's policies will make the country more or less competitive globally and if the dollar remains the world's reserve currency.
Gary Cohn, IBM's vice chair, criticized tariffs in other venues recently, but while sitting on a panel including Trump supporters former Republican House Speaker Kevin McCarthy and Virginia Gov. Glenn Youngkin, came across as largely supportive.
Cohn resigned after a year as Trump's top economic advisor during the president's first term, saying then that tariffs would harm the economy and damage relationships with foreign partners.
Cohn
"We are going to come out of this just fine. We have lived through recessions, depressions and COVID-19. Every time we thought it was bad, we came out of it a lot better. We are the reserve currency in the world — and we are going to remain the reserve system," Cohn said.
The administration understands the importance of the dollar remaining the world's reserve currency, said Steven Mnuchin, founder and managing partner, Liberty Strategic Capital, speaking on another panel.
"Other than moving into gold, there is no alternative," said Mnuchin, Trump's treasury secretary during his first term. "It is very important to have a stable dollar and to keep the dollar the reserve currency, otherwise we will have an even harder time paying down the federal debt."
McCarthy took on the role of Trump whisperer in his comments on the president's trade negotiations.
"When he says he wants to put a 10% tariff on a country, he will put a 10% tariff. When he says 25% or more, that's a negotiation," McCarthy said. "He's always negotiating, and if you try to follow his negotiations, it will make you crazy. But he will force a reset in China. He will be much more positive with the UK and India. In the long run, it will make us stronger."
McCarthy retired in 2023 after 16 years in the House, which included nine months as Speaker, before he was ousted.
Peter Orszag, chief executive officer and chairman at asset management firm Lazard, and Office of Management and Budget head in the Obama administration, warned the trade war could threaten the nation's place in the world.
"I think we will be more micro resilient and less macro resilient," Orszag said. "Certain supply chains like pharmaceuticals will be stronger, but our strength and reputation globally will be less macro resilient. I think we will be more vulnerable."
Youngkin and McCarthy downplayed the chilling effect Trump's immigration policies could have on attracting top global talent or university students — necessary to helping the nation stay on top in AI.
The policies resulted in the revocation of a dozen visas for University of California-Los Angeles students and former students in April.
"There is not a shortage of talent who wants to come to the U.S. and engage in advancement of business," Youngkin said. "That is legal immigration."
Even if reports of European business leaders bringing burner phones when they visit the U.S. is mostly anecdotal, Orszag said, that kind of atmosphere could affect our country's ability to attract top talent. "The number of CEOs, I have spoken to that say they are bringing a burner phone to visit the U.S., is higher than it ought to be," he said.
In April, Forbes reported European Commission staff headed to World Bank and International Monetary Fund meetings in Washington, D.C., were being advised to come equipped with special burner phones and replacement laptops issued specifically for U.S. travel. The security measures replicate those taken when staff travels to China. The aim is to protect European information from a surveillance by a hostile country, which some Europeans say the U.S. has become.
"Trump got elected on two factors: the border and the economy," McCarthy said. "Just like everything else, you have to make a statement. I think this is a small part of it, but it makes people rethink. I am more concerned about our relationship with Canada and Mexico. That needs to work. If we can't reach an agreement with our neighbors, how are we going to accomplish it with other trade partners."
