EconAir

TARIFF AND TRADE POLICY:   HOW TO KNOW THAT TRUMP’S POLICIES ARE WORKING   Tens of thousands of American workers apply for new jobs sewing clothes in NYC’s revitalized garment district. They work 12 hours a day, 6 days a week for $144/week ($2/hour) with no benefits or pensions. The White House orders 10 million MAGA caps.   The U.S. begins producing pineapples and bananas in Hawaii again. Dole (pineapples) and United Fruit (Chiquita Banana) buy large tracts of land where pineapples and bananas were grown in the past. They also buy and demolish the luxury hotels and condo developments sitting on the land. The price of Hawaiian bananas is $10/pound. U.S. farmers apply for food stamps.   In the Christmas shopping season, the prices of Barbie dolls and Legos double. Parents experience sticker shock. Children beg and cry for Barbies and Legos. Parents give in. Children are abandoned on the doorsteps of grandparents living in The Villages. Grandparents organize and lobby ...

    SUMMARY   The Trump tariff offensive is couched in domestic economic terms and objectives – to reduce the trade deficit, to reduce the fiscal deficit, to increase domestic manufacturing, especially in technologies with good growth potential or necessary for national security. The economic issues used to justify the higher tariffs, however, are part of a larger challenge - the geopolitical rivalry between the United States and China, and part of a broader objective – to weaken China’s domestic economy.   The economic issues used to justify the higher tariffs are less important than the geopolitical issues - the geopolitical rivalry between the United States and China - and part of a broader objective – to weaken China’s domestic economy.       BACKGROUND   The conflict with China has been recognized as far back as the Obama administration. Even before then, the United States has used economic tools as political weapons – sanctions, denying othe...