Congratulations everyone! Your buying power just went down! Trump issued in his sweeping tariffs with the push for at least a 10% tariff on everything that is imported into the United States and in the cases of some countries like Vietnam, it is a whopping 46%. Foreign cars will be hit with a 25% tariff. I hope no one plans to buy that BMW or Porsche any time soon!!
They say the definition of insanity is doing the same thing over and over and expecting a different result. According to that, America is insane, or should I say, the people who supported and elected Trump are insane. During Trump’s first term when he launched his trade war, it is estimated to have cost American consumers $80 BILLION which is equivalent to one of the largest tax increases in recent history. Why did anyone expect his second term would be any different? Particularly when he said during his campaign this was exactly what he was going to do. The only difference this time around is that it will cost the American consumers even more.
It is very difficult for me (and almost all credible economists) to see how anyone benefits from this nonsensical trade war. The American consumer will pay the tariffs through higher prices. And American businesses will have trouble exporting their products overseas because of 1) the retaliatory tariffs that other countries impose and 2) because many countries such as Canada are just pissed off at the United States and there are widespread boycotts of American products which I predict will extend around the globe.
The simple fact is these tariffs are not really about a long-term, strategic policy that will benefit the United States. This is simply extortion to get countries to bend to the will of Trump. How long will it be before he tells another sovereign nation that he will be happy to lift their tariffs if they eliminate all DEI and woke policies that Trump and his sycophants disagree with? Trump clearly has zero respect for sovereign borders (think Panama, Greenland, Canada) and this is simply an effort to get countries to bend to his will. It is a power play to satisfy his ego and has nothing to do with making America great again.
So, to sum up the state of the world in Trumpland: 1) prices will increase for American consumers, 2) the global market will likely shrink for American businesses, 3) and we have permanently damaged long-term relationships with our strategic allies. What the hell? How does this make America great? The short answer – it doesn’t, and it won’t!
If prices increase for American consumers, they are likely to spend less because they will have to budget more carefully. If international markets shrink for American businesses, they will record lower profits which will displease Wall Street and stock prices will fall, perhaps farther than they already have.
This nonsense could also jeopardize our national security. Our allies are very likely to decide that America is no longer a valued partner in NATO so perhaps they will vote to kick America out of NATO, or they will establish a new treaty organization without the United States. They are surely rethinking sharing intelligence information with the United States given the clowns at the heads of the DOD and the intelligence community. After the attacks of Sept. 11th, our NATO allies jumped in to help us. If something similar, or worse, happens again, they might just say, “OK, Donald, you want American to stand alone and not play nicely with others, you are on your own. Good luck!”
There is no possible way this trade war will be beneficial to America in the long run. At the rate this is going, America will take the same route as Trump’s Atlantic City casinos. The only question is, how long will it take Trump to bankrupt and destroy the US economy? The bigger problem this time is that it will be the American consumers, American farmers and American businesses who get left holding the bag instead of a bunch of wealthy banks.
The question that I just cannot wrap my head around is, “How did someone who has a long track record of failed businesses, multiple bankruptcies, is a proven liar many times over, and a convicted felon, get elected to this office?” If someone voted for Trump solely because of his stance on abortion and Roe v. Wade, they should shut up and not complain. If someone voted for Trump solely because of his stance on immigration, they should shut up and not complain. If someone voted for Trump because they really believed he was going to bring prices down, they should shut up and not complain.
This was all predictable, so if someone voted for him, they should just shut up and not complain. It was all predictable and avoidable and yet, here we are. And when all is said and done, China, the country that Trump and his toadies say is our biggest threat, will emerge as the big winner. Their global influence will increase, and the United States will become a lesser power and more isolated. The price of one man’s ego!!
What icebergs? Full steam ahead!
