How Trump's Radical Tariff Plan Could Wreck Our Economy

[BootinUp]

Paul Krugman goes through the history of tariffs in the US.

Donald Trump has flip-flopped on many issues: Today, he says he’s pro-life; in 1999, he said, “I’m very pro-choice.” Last year, he said Republicans should “never give up!” on trying to repeal Obamacare; during September’s presidential debate, he said, “I saved it.” Three years ago, he said Bitcoin “seems like a scam”; now he wants to make America the “crypto capital of the planet.”

But Trump’s desire for high tariffs has been consistent. In an interview on Tuesday at the Economic Club of Chicago, he said, “To me, the most beautiful word in the dictionary is ‘tariff.’” As president, he called himself “a Tariff Man.” In fact, he imposed substantial tariffs when in office. Those actions were, however, mild compared with the tariffs he is proposing now. He initially suggested a 10 percent tariff on all imports, but now he talks about tariffs as high as 20 percent. (In Chicago, he even mused about 50 percent.) He wants a 60 percent tariff on imports from China.

Furthermore, the Trump tariffs would rip up the agreements that keep worldwide tariffs relatively low, inspiring both retaliation and emulation that would fragment world markets.

This would hurt even big, rich economies like those of the United States and the European Union. But it could prove catastrophic for smaller, poorer economies. The Trump tariffs could cause a spike in global poverty — and, it’s easy to imagine, global conflict.

So, what’s the bottom line on the pros and cons of Trump’s tariff proposals?

Cons: The tariffs would impose large burdens on middle- and lower-income families. They probably wouldn’t significantly reduce the trade deficit and might actually hurt American manufacturing. And unilateral U.S. tariff action would wreak havoc by fracturing the world trading system.

Pros: I can’t think of any.

https://www.nytimes.com/2024/10/17/opinion/trump-tariffs-economy.html?unlocked_article_code=1.TE4.Tf1U.yXbauB_CeQar&smid=url-share