Marty Davis thinks President Donald Trump has “done more that’s right for trade in America than any president since World War II.” Davis, a Minnesotan and member of one of the country’s richest families, once worked on his family’s massive dairy farm. Now, he runs Cambria, a producer of quartz used in countertops and other surfaces. His battle against Chinese competitors who dumped hundreds of millions of dollars worth of government-subsidized quartz slabs into the U.S. market from 2010-2018 made him a true believer in Trump’s tariffs on some imports. Davis said the Chinese offered finished quartz at prices below the cost of his raw material.
He calls Trump “courageous, intelligent and right” on trade issues. China is engaged in “global economic warfare,” Davis believes. If they win, he said, “their power is greater than that of the military.” Davis said “fake” low prices set by foreign government subsidies have lured U.S. corporate executives and consumers alike. But the homegrown multimillionaire believes that if the U.S. does not push back with trade sanctions, the cost of short-term bargains could be the extinction of the country’s middle-income manufacturing workers.
Q: You said you were willing to compete with any company, but you couldn’t compete with a government. What did you mean?
A: Competing with a product out of China, our factory workers or sales representatives have to compete against sales representatives or factory workers funded by a country’s treasury. That’s an impossible circumstance to achieve success.
Q: You got the U.S. government to place anti-dumping tariffs on Chinese quartz. What set you off?
A: Our most loyal dealers were saying they can’t remain loyal to our brand as a result of these ungodly low-priced products coming out of China. I never understood that [Chinese companies] were so state-fueled and state-owned. It was funding of raw materials. It was subsidy of infrastructure, of factory equipment, everything. They slowly eroded the marketplace for us and other U.S. competitors. In addition to all of that, they copied our [intellectual property].We were going to add two lines of production. Because of the dumping, we shut down that expansion. We put it on pause. That would have been an investment of $150 million in fixed assets, and we would have expanded the factory by some 250 to 300 people.
Q: Many other international business people consider the president’s tariffs and trade policies an attack on globalization. Why aren’t you upset by what the president is doing?
A: The essence of protectionism is unfair trade. Politicians — Republicans and Democrats — and many, many public company CEOs miss that. I use the axiom that we enjoy the fruit of foreign protectionism, say cheap foreign steel, and they quietly move the root [system of production]. My line is — and I’m not trying to be a poet here — pretty soon, they’ll have the root and there’ll be no more fruit. American CEOs and investors and companies enjoy the cheap price. But someday that fruit will run out. It will run out in one of two forms. They either won’t supply us for some geopolitical reason. Or they’ll supply it at much [higher prices] than they do today. We get good [financial balance sheet] numbers today. And we’re happy. But during the dark of night, the Chinese Communist Party dictatorship is displacing the entire root system of American manufacturing and technology. Our factory workers are strong middle-income earners. Now we’re creating a world that is service- and technology-oriented. Factory jobs in America are what fuels the middle class, and they’re leaving.
Q: What do you think of a bill in Congress to limit Trump’s power to use national security as a reason to impose tariffs?
A: Democracy works better than any system in the world. But when you have a dictatorship that can make targeted decisions without any political chaos in their own country, you now have the CEO of a country going against the chaos of a democracy. To usurp the president’s powers right now in the self-interest of companies and Wall Street, that’s crazy. But that’s what [Chinese President] Xi Jinping is counting on.
Q: You talk about CEOs and Wall Street, but American consumers like the cheap fruit, too. How do you ask people to make a sacrifice?
A: Trump needs to do a much better job of explaining it in a grassroots manner. But the reality is: How comfortable are you as a consumer getting subsidized by the Chinese government. Do you think that you are really the beneficiary? Or are you being set up to be the hostage?