There is a situation where tariffs are useful tools for dealing with trade deficits and protecting key sectors of the country’s economy. Then there is a situation where many penguins are denounced on unmanned currency manipulation islands. Which do you think you live in?
This is a take-home of the diverse tariffs announced by President Donald Trump on Wednesday afternoon. In addition to the Penguin-occupied Heard Islands and MacDonald Islands, tariffs are targeting the British Indian Ocean territory. Yes, the United States collects mutual tariffs on its own military.
And then there are tariffs on countries that have actual goods and services that rely on US consumers. China: 54%. Vietnam: 46%. Cambodia: 49%. Korea: 25%. The corners of the US consumer economy cannot be touched. Prices will rise. The stock market is spiral. recession loom. The tech industry is upside down. That’s what billionaire Mark Cuban is Encouragement People stockpiling supplies before it’s too late.
It’s reckless, it’s ridiculous, and it’s also everything Donald Trump clearly said in his campaign trajectory. Certainly he did not telegraph how he was misguided. Methodology It will be – you can read more about it herebut it is enough to say it is completely separate from the reality of international trade, but he repeatedly promised the path to glory.
It is listed goal It’s about returning manufacturing jobs to the United States. This is like reviving the dodo. The US still produces a lot of products. According to China, it is the second only in annual production. World Bank. But much of the industry’s work has been replaced by automation. This is a bottle that cannot be re-cored. Also, an increase in domestic labor costs means that US-made products will become inherently expensive. American consumers have been consistently rejected. All of this was already true in Trump’s first terminology. It’s even more so now.
And let’s say multiple companies decide to re-land or install a factory in the US on the re-shore. These decisions and implementation timelines are measured in years, if not decades, with follow-throughs unevenly. (just Ask foxconn. ) So, what will happen in the meantime?
The rationale has all the weights of soap bubbles. There is no world where the United States suddenly produces all the items that the country has decided to target. Currently, Madagascar has a 47% tariff. Do you know why the US has a trade deficit with Madagascar? They produce vanilla. We don’t. That won’t change unless you suddenly set up a vanilla assembly line in Ohio.
But all Trump’s so-called liberation day is a ploy to all master negotiations. “Everyone sit down and take a deep breath. Don’t retaliate right away. Let’s see where this goes.” I said CNN Treasury Secretary Scott Bescent on Wednesday. “If you retaliate, that’s how we escalate.”
