Whether it’s supposedly, aimed at China, Mexico, Canada, the European Union (EU), Japan, or any other nation, it seems, our President, hasn’t found a tariff, and/ or trade war, he doesn’t enjoy! Historians, and economists, nearly universally, state, over the longer – run, imposing tariffs, has little, enduring, positive impact, but, often, a significant set of negative ramifications. When we impose these, the other party, generally, retaliates, by imposing their own set of, either, tariffs, or other economic sanctions, on us! Major retailers, automakers, electronics companies, etc, warn us, the fees, on China, will have the impact, of raising prices. Farmers have experienced numerous challenges, because, China, the largest purchaser of soy, and other products, has turned to other trade partners! If, and when, these are, introduced on Mexican products, nearly everything will cost more, because Mexico is, our largest trade partner. With that in mind, this article will attempt to, briefly, consider, examine, review, and discuss, 5 examples.
1. They don’t work: One must question, whether, Donald Trump, understands, and/ or, really cares, who, actually, ends up, paying for these. Tariffs are imposed on the importers, not the foreign suppliers, and, in the vast number of instances, is past along, to consumers. In addition, historically, they haven’t had a longer – term, positive effect, and, unfortunately, linger, anyway, because the government, often, enjoys receiving this source of revenue. It is a hidden tax, which it seems, we are witnessing, right, in – front – of, us, in, the open!
2. Harm domestic economy: Even if one benefited, from the 2017 tax reform, which predominantly, aided larger corporations, and not, to any significant degree, most of us, any benefit, will be more than eliminated, by the extra costs of buying merchandise, foods, etc. We have already, witnessed, many farmers, harmed, by the first round of tariffs, and, as these increase, and become, more wide – spread, things will, only, get worse!
3. Impact world economy: How will these, effect, the overall, world economy? Most experts proclaim, it will, harm most of these economies, because, there are usually, no real winners, in a trade war!
4. Political ramifications: There will be ramifications, both, within the United States, and most of the rest of the world, and, economic challenges, nearly always, bring, with them, political ramifications! When there is a trade war, doesn’t it make sense, it will weaken alliances, and decrease, overall trust?
5. Net impacts: Ideally, there would be free trade, throughout the world. Since we live in a world economy, and most major corporations, are, multi – national, some believe, this behavior will bring, with it, a larger possibility of worldwide recession, etc.
Tariffs and trade wars, although punitive, generally, punish consumers, far more than the politician’s intended vision! Wake up, America, and realize, this isn’t normal!