Scott Lincicome: “Perhaps the most levelheaded defense of Donald Trump’s misguided plan for steep global tariffs is that they’ll never be imposed. Trump surrogates have lately been assuring the business world that the former president will, if elected, use merely the threat of across-the-board import taxes of 10 to 20 percent to pressure other countries to lower their own barriers to American goods. The result: freer trade among participating nations, and more revenue for American companies, without ever firing anything more than a warning shot…”
“The idea that the White House can use import restrictions to affect foreign governments’ policies is not entirely without precedent. Research shows that from the 1970s through the early 1990s, various administrations sometimes succeeded in prying open foreign markets by threatening tariffs or other protectionist measures. A reasonable case can even be made that Trump’s 2019 promise to slap 10 percent tariffs on Mexican imports helped push our southern neighbor to cooperate more fully on restricting illegal immigration.
“Trump’s new global tariff threat, however, would likely be far less successful, and would impose significant costs even if the tariffs were never applied. The ‘just a threat’ strategy sounds nice in the abstract but in reality suffers from fatal flaws: It ignores not only America’s checkered history of such gambits but also the economic damage that threats alone can inflict on the American and global economies.
“The occasional tariff-threat-success stories are exceptions to a broader negative trend. In a comprehensive analysis of every U.S. unfair-trade investigation from 1975 to 1993—91 cases targeting foreign discrimination against U.S. goods, services, and intellectual property—Kimberly Ann Elliott and Thomas O. Bayard found that American efforts to pressure foreign countries to open up their markets were successful less than half of the time. The authors’ definition of ‘success’ was generous to U.S. officials: It could include just the partial achievement of U.S. objectives and result in no actual trade liberalization. Even then, the wins occurred mostly when a single country was dependent on the U.S. market—a situation that applies to only a few countries today—and during a short period in the mid-1980s, when the U.S. had far more economic heft in global markets than it has now. (China in 1991, for example, shipped almost one-third of its exports to the United States; today, the number is about 15 percent.) When the U.S. government actually applied trade restrictions, moreover, the strategy worked only twice in 12 tries. In the other 10 cases, foreign governments did not acquiesce to American demands; despite new U.S. protectionism, they kept in place the policies and practices to which Washington objected.”
Trump’s Tariffs and Tax proposals, a tax hike for low- and middle-income Americans, combined with his massive deportation plans, will have a one two punch, with a devastating impact on our economy while exacerbating the US labor shortage.
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Scott Lincicome: “Perhaps the most levelheaded defense of Donald Trump’s misguided plan for steep global tariffs is that they’ll never be imposed. Trump surrogates have lately been assuring the business world that the former president will, if elected, use merely the threat of across-the-board import taxes of 10 to 20 percent to pressure other countries to lower their own barriers to American goods. The result: freer trade among participating nations, and more revenue for American companies, without ever firing anything more than a warning shot…”
“The idea that the White House can use import restrictions to affect foreign governments’ policies is not entirely without precedent. Research shows that from the 1970s through the early 1990s, various administrations sometimes succeeded in prying open foreign markets by threatening tariffs or other protectionist measures. A reasonable case can even be made that Trump’s 2019 promise to slap 10 percent tariffs on Mexican imports helped push our southern neighbor to cooperate more fully on restricting illegal immigration.
“Trump’s new global tariff threat, however, would likely be far less successful, and would impose significant costs even if the tariffs were never applied. The ‘just a threat’ strategy sounds nice in the abstract but in reality suffers from fatal flaws: It ignores not only America’s checkered history of such gambits but also the economic damage that threats alone can inflict on the American and global economies.
“The occasional tariff-threat-success stories are exceptions to a broader negative trend. In a comprehensive analysis of every U.S. unfair-trade investigation from 1975 to 1993—91 cases targeting foreign discrimination against U.S. goods, services, and intellectual property—Kimberly Ann Elliott and Thomas O. Bayard found that American efforts to pressure foreign countries to open up their markets were successful less than half of the time. The authors’ definition of ‘success’ was generous to U.S. officials: It could include just the partial achievement of U.S. objectives and result in no actual trade liberalization. Even then, the wins occurred mostly when a single country was dependent on the U.S. market—a situation that applies to only a few countries today—and during a short period in the mid-1980s, when the U.S. had far more economic heft in global markets than it has now. (China in 1991, for example, shipped almost one-third of its exports to the United States; today, the number is about 15 percent.) When the U.S. government actually applied trade restrictions, moreover, the strategy worked only twice in 12 tries. In the other 10 cases, foreign governments did not acquiesce to American demands; despite new U.S. protectionism, they kept in place the policies and practices to which Washington objected.”
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Trump’s Tariffs and Tax proposals, a tax hike for low- and middle-income Americans, combined with his massive deportation plans, will have a one two punch, with a devastating impact on our economy while exacerbating the US labor shortage.
lol. Okay.
Oh no. Anyway..
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