jimboston wrote:The tariffs/trade war that Trump is initiating is NOT the worst thing he’s doing… but it’s pretty bad.
I agree with the long-term goal of trying to re-shore some manufacturing and become less reliant on other countries for the vast majority of our consumer goods. That goal however is in conflict with Trump’s stated immigration policies. I also think that it is only a goal that can be achieved with long-term policies and buy-in from both political parties… as any attempt to do this unilaterally could result in a reversal of these policies under the next administration / congress.
A few points…
*Just because Trump “wrote” a book called the Art of the Deal does NOT mean he is good at making deals. He has been bankrupt numerous times. He’s only been saved from bankruptcy because he became a celebrity. He is NOT a self-made man… he inherited his initial wealth from his father. Much of his money in real estate has been made by lying and breaking deals… not paying contracts/contractors, then making them threaten to take him to court… and finally “negotiating” the amount due down. These “business tactics” that he used his whole career are not great, and though they kinda work in the real estate market where he made his money they are NOT tactics that will work in International space. They “worked” because they took advantage of weaknesses in our legal system… these tricks don’t translate to international negotiations between Nations.
*Even if he does wind up “making deals” the chaos he is flooding the system with will cause (and has already caused) people to lose money, and will disrupt what was a strengthening economy. The economy cannot just immediately ‘bounce back’. Even if he were able to make deals with all the major players the disruption will set us back and cause economic pain. That said, it seems unlikely he will be able to use these ‘tactics’ to make deals with all the major players… or at least not quickly enough. Current projections have changed from an economy that was on solid ground with shrinking inflation… to an economy that will experience rising inflation and at least a modest downturn if not an outright recession.
*Finally, this is not necessarily a win-lose proposition when we look at how these tariffs and this trade war will affect other countries. More likely it is a lose-lose proposition. The most likely outcome is that these trade issues will cause economic issues both here at home, and also abroad. So people who claim that “China and the EU can get along fine without us”… yeah maybe in the long term they can, but in the short term they will both lose. At the same time people who claim that “the DAX is Germany has fallen, they’ll capitulate”… I mean yeah it’s true that the DAX will drop, but so won’t the DOW Jones. We will ALL feel the pain… and if he doesn’t pull back it won’t be a short term thing… it COULD spark a recession or stagflation that lasts YEARS.
In the end… a decade from now… we might be able to say we brought some manufacturing back. I don’t know… it’s impossible to predict. I am confident enough to say that the path to that future is very likely to be unpleasant for many Americans. I feel a slower and more thoughtful approach with bipartisan support could achieve the same results with less pain and disruption over the same decade-long period.
EVEN IF the tariffs and deals do not work as well as Trump PROCLAIMS (usually with LOTS of hyperbole, so that is a safe bet, btw), the USA is BETTER off than if we elected Kamala or re-elected Biden. There is LITTLE doubt about that, IF Trump can achive SOME or Most of the following:
1) Bring down the Federal Debt for each of the next few fiscal years.
2) Perhaps reduce the overall TOTAL US deficit (to take the pressure off our Children and the Grandchildren, too).
3) Reduce the Federal work force to be "leaner AND more efficient" as done in MANY businesses over the past 30-40 years or more.
4) Reduce the federal budget by cutting waste and finding fraud, as happened already, based on (ONLY very) few examples cited by DOGE, Musk, and Trump.
5) The stock market recovers its losses in the next 6-15 months.
6) Bring down the rate of inflation and be able to offset any inflationary pressures caused by new tariffs, and by Trump's disruption of the Federal expenditures and budget.
7) Allow expansion AND growth of Businesses. AND, finally, for now,
8 ) Bring back some businesses and factories from overseas so that the US is LESS reliant on manufacturing overseas. This will bring some good paying jobs to America, such as in the Steel and Aluminum manufacturing businesses. I really think the US has allowed its industrial and manufacturing base to ERODE over that past 30-40 years to the detriment of our nation. Depending on China for pharmaceutical supplies and chemicals is a prime example of the need for SOME manufacturing in the USA.
These expectations are HUGE and I doubt Trump will achieve ALL these goals before his term ENDS. BUT there have been steps taken to correct the course of our Economy and our Nation with the Election of Donald J. Trump. As I have said before, the only solution known to Biden and other Liberal Democrats like Kamala and Gavin is to SPEND more money that we do not have and promoting more growth of the Federal Government with its inefficiencies and worse (abuse and fraud and waste).
More Federal money is NOT the solution to every problem. If it were, we would have a BOOMING Economy NOW, before Trump took office.
Posted: Mon Apr 07, 2025 2:44 am
in 5-10 years IF WE MAINTAIN LARGE TARIFFS THE WHOLE TIME, could bring back factories that will be heavily automated and may create some low paying jobs but is likely to boost domestic production of goods... We of course will have a really hard time exporting any of them in this hypothetical because of reciprocal tariffs... and in the meantime we can look forward to years and years of stagflation with increased unemployment, lower demand, and shrinking GDP.