Tariff Mistake Smoking Gun: Trade Deficit Soars, Expect Negative GDP Revisions

Tariff Mistake Smoking Gun: Trade Deficit Soars, Expect Negative GDP Revisions

Troy Powers
March 7, 2019

"This is a major reason why economists say, 'You really don't want this as your scorecard, "' said Phil Levy, a former senior economist for trade with president George W. Bush's council of economic advisers.

"Macroeconomics end up ruling". American consumers and businesses have not stopped buying foreign goods, as the new data indicates, but they are paying higher prices for the privledge of doing so.

Moreover, his attacks and threats to impose tariffs on trading partners from China to the European Union has also contributed to the slowdown in those economies and therefore their demand for American goods.

With the exception of February 2017, every month of the Trump presidency has seen an increase in the trade deficit compared to the same month in the previous year.

China won't make big concessions to the U.S. in order to seal a trade deal, former finance minister Lou Jiwei said in Beijing on Wednesday (March 6), calling some USA demands for change "unreasonable".

Donald J. Trump on Twitter: "I have asked China to immediately remove all Tariffs on our agricultural products (including beef, pork, etc.) based on the fact that we are moving along nicely with Trade discussions...."Donald J. Trump on Twitter: "....and I did not increase their second traunch of Tariffs to 25% on March 1st".

"We will continue to call on China to end these counterproductive policies, free all those arbitrarily detained, and cease efforts to coerce members of its Muslim minority groups residing overseas to return to China to face an uncertain fate", she said.

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"President Trump has said, and I cautioned, its gotta be a good deal for the United States and its gotta be an enforceable deal", stated Kudlow. After accounting for the impact of higher tariff revenue and the benefits of higher prices to domestic producers the study found the aggregate annual loss for the USA economy fell to $6.4 billion, or 0.03 percent of GDP. "When things are booming we consume more imports".

That was offset by the gains from protectionism derived by USA producers benefiting from the tariffs, the economists found.

"Billions of dollars, right now, are pouring into our Treasury", he told the Conservative Political Action Conference, adding that Chinese exporters are absorbing nearly the entire burden of the tariffs.

US President Donald Trump, the self-proclaimed Tariff Man, is set to become the $100 Billion Man.

Weinstein said the President appears to be relying on a 2018 analysis of data from the 1990s, when the U.S. represented a larger share of the global economy and enjoyed more leverage over exporters in other countries.

There are clear indicators that the Chinese economy is taking a hit from American tariffs. They also were causing the diversion of $165 billion a year in trade leading to significant costs for companies having to reorganize supply chains.

Trump on Friday asked China to immediately remove all tariffs on USA agriculture, though he didn't indicate if his demand was limited to retaliatory duties or more far-reaching. "It's pretty unclear that this trade war is a net win for the economy at this point".