Trump’s import tariffs are costing us an arm and a leg

Trump's import tariffs are costing us an arm and a leg

Trump’s import tariffs are costing us an arm and a leg Echoing his claims that Mexico is paying for the wall , President Trump keeps repeating that it is the Chinese who will be paying for the U.S. import tariffs on their goods. Never mind that the escalation in the U.S. trade war has sent U.S. and global equity markets reeling . Never mind too that the U.S. bond market is now strongly signaling that the U.S. is headed for an economic recession. To be sure , with China’s decision to depreciate its currency in response to U.S. import tariff threats, President Trump could turn out to be correct in the narrowest of senses. It will be the Chinese exporters rather than the U.S. consumer who will bear the major burden in paying for those tariffs. But one has to hope that this does not blind Trump to the broader and very much more important issue. Import tariffs on China are a major threat to the U.S. and global economic recoveries and they could involve the wiping out of literally trillions of U.S. dollars in stock market value. These costs would totally dwarf any increase in budget revenues that the tariffs might produce. And those costs would be borne importantly by the American public. Trump is certainly correct in thinking that a 20 percent tariff on China’s $500 billion exports to the U.S. would produce around $100 billion a year in extra revenues to the U.S. budget. He is […]

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