ECON 101: Trump Succinctly Breaks Down Trade Tariff Debate
“Trade tariffs.” Did your eyes just glass over? Do you feel the sudden need for a nap?
You’re not alone. Discussion of trade tariffs can be a mind-numbing venture, and few — short of expert economists — know exactly what the whole mess means.
But President Trump has a way of breaking through all the mumbo-jumbo and summing up a subject like few can.
“When a car is sent to the United States from China, there is a Tariff to be paid of 2 1/2%,” Trump wrote on Twitter on Monday. “When a car is sent to China from the United States, there is a Tariff to be paid of 25%. Does that sound like free or fair trade. No, it sounds like STUPID TRADE – going on for years!”
Of course, the liberal media was enraged that Trump would explain something in such simple terms.
“President Donald Trump on Monday complained yet again about ‘STUPID TRADE’ with China, doing little to calm investors anxious about the escalating trade conflict between the two economic superpowers,” CNBC wrote.
Oh, here was another headline off the CNBC site Monday morning. “Dow soars 250 points and Nasdaq pops 1.5%.” So yeah, those anxious investors apparently didn’t mind Trump’s tweet too much.
China’s tariff’s are even worse than what Trump said. The communist country charges 25% tariffs on most imported cars, but since 2016 has added 10% on “super-luxury” vehicles priced $200,000. The U.S. tariffs are not yet in place, but China is threatening to retaliate and has already threatened to impose some tit-for-tat tariffs. Still, on Sunday Trump vowed he would remain friends with Chinese President Xi Jinping.
The trade imbalance with China has been growing for decades. “The U.S. bought more than $500 billion in goods from China last year and now is planning or considering penalties on some $150 billion of those imports. The U.S. sold about $130 billion in goods to China in 2017,” CNBC reported.
Meanwhile, White House economic advisor Larry Kudlow is backing Trump, telling CNBC on Monday that the president is right on China.
“This president’s got some backbone, others didn’t and he’s raising the issue in full public view, setting up a process that may include tariffs. Hopefully, it will be mostly negotiations,” Kudlow said on “Squawk on the Street.” “I don’t know if we’ll have tariffs or not.”
“[Trump] is responding to decades of misdeeds by China [on] trade,” said Kudlow, a former CNBC contributor and Wall Street economist. “It’s high time we did that.”
“Somebody’s got to do it. Somebody’s got to say to China, ‘you are no longer a Third World country. You are a First World country and you have to act like it,'” he said. “The president’s got to stick up for himself and the United States.”