Trump likes to play chicken, but, this time, the "die has been cast":
Tariffs Will Have Predictable Effects, Starting at the Worst Possible Time for the GOP
Quote:Tariffs Will Have Predictable Effects, Starting at the Worst Possible Time for the GOP
It tends to take economists a while to crunch all the numbers, but now various think tanks have started issuing reports on what will happen if Donald Trump sticks to his guns, tariff-wise, and it isn't going to be pretty.
In the short-term, prices will start to climb, profits will start to fall, and unemployment will start to creep back up. The impacts will be felt in some sectors of the economy more than others; for example, a can of Coke might cost a few cents more, while the price of the average new car might rise as much as $6,000. These effects will become palpable in just a manner of months, meaning that they will definitely be felt by the midterms. "We're already hearing complaints now from companies, so by the time we get to the midterms, you're going to be hearing governors, mayors, Congress complaining about jobs, about cost increases, about problems," said Carlos Gutierrez, who served as Secretary of Commerce under George W. Bush.
In the medium- and long-term, things are going to get even uglier. The nonpartisan Tax Foundation, in its report, says that the tariffs will reduce U.S. GDP by 0.47% (about $118 billion) and will lead to the loss of 364,000 jobs. The International Monetary Fund, meanwhile, says that global output would drop by $400 billion. There is also a near-universal consensus that the U.S. economy would enter a recession, and possibly even a depression.
So, as someone famous for changing policies and positions on a dime, sometimes several times in one day, will Trump really stick to his guns? It certainly looks that way. While has been inconsistent on most issues throughout his life (including which political party he belongs to), he has been obsessed with the United States' trade deficit for at least four decades. Further, his rhetoric in the past few months, and especially the past few weeks, has made clear that he understands the consequences of a trade war, and he is fine with them. It's also worth noting that even if Trump does change his mind at this point, it's likely too late. Some businesses are going to be leery of committing to new trade deals, for fear that their legs will get knocked out from under them, while others are going to stick with plans to move operations abroad as a hedge against retaliatory tariffs. So, the die has probably already been cast. (Z)
Tariffs Will Have Predictable Effects, Starting at the Worst Possible Time for the GOP
