The Blunt Force Trauma of the Trump Tariffs

There are cases in which customs tariffs are considered a useful tool for treating trade deficit, or to protect the main sectors of the country’s economy. Then there are cases in which a handful of penguins on an uninhabited island is accused of manipulating the currency. Guessing which one we live in?

This is the fast food for the multiple definitions announced by president Donald Trump on Wednesday afternoon. In addition to the Hurd islands occupied by the Penguin and McDonald’s Islands, the customs tariff aims to the British Indian Ocean, whose only occupants live on a joint military base on Diego Garcia. Yes, the United States is exposing a mutual tariff against its forces.

Then there is a tariff against countries that have actual goods and services on which consumers depend. China: 54 percent. Vietnam: 46 percent. Cambodia: 49 percent. South Korea: 25 percent. It will not affect any corner of the US consumer. Prices will rise. The stock market is escalating. Rawds waving on the horizon. The technology industry will be turned upside down. Mark Kobe, billionaire, said, encouraging people to store consumables before it is too late.

It is a reckless thing, it is ridiculous, and all that Donald Trump clearly said is that he would do it in the path of the campaign. It is true that he has not announced the preference of the methodology – you can read more about it here, it is sufficient to say that it is completely separate from the facts of international trade – but he promised loudly, repeatedly and repeatedly defining glory.

The declared goal is to return manufacturing functions to the United States, which is somewhat similar to the revival of Dodo. The United States continues to make a lot of goods. It is second after China in annual production, according to the World Bank. But many industry functions have been replaced with automation, a bottle that you cannot re -formulate. The high costs of local employment means that the products made by the United States will be more expensive, and American consumers have constantly rejected. All this was already true in Trump’s first state. It is more than that now.

We let us say that a large number of companies decided to return a shore or create factories in the United States. The schedule of these decisions and implementation is measured for years, if not contracts, and the follow -up can be suspended. (Just ask Foxconn.) What happens in the meantime?

The logical basis has all the weight of the soap bubble. There is no world in which the United States suddenly manufactures all the elements that the country decided to target. There is a 47 percent tariff on Madagascar now. Do you know why the United States suffers from a trade deficit with Madagascar? It produces vanilla. We do not. Unless we suddenly prepare vanilla assembly lines in Ohio, this does not change.

But Perhaps Trump’s alleged liberation day is just a trick negotiating. “Everyone is sitting, take a deep breath. Don’t decrease immediately. Let’s see where this goes,” said Treasury Secretary Scott Payette at CNN. “Because if you review, this is the way we deal with.”