Is anyone watching this Trump car crash?

[soundsys]

WTF is happening? It’s like some bizarre performance art piece.

He’s holding up signs and shouting and throwing out hats it’s just 🤯

There doesn’t seem to be any economic experts who can see the sense in them from a US point of view either. I think it is clear that they are not a good idea for the US. It’s got nothing to do with what people on the thread think of Trump.

I’m pointing out that there is obviously some rationale behind them. They can’t be just all completely crazy. From articles today it seems like he’s open to negotiation. Leveraging the power of chaos to get everyone to suck up to him basically.

Well, I'm looking for a reputable economist or two, not in the Trump administration, who is seeing this as a positive for the US.

I'm American and would find it quite comforting to find a way to believe the country isn't totally fucked.

Can you find me a couple?

The best and simplest case for tariffs is from Oxford Economics:

https://www.oxfordeconomics.com/resource/tariffs-101-what-are-they-and-how-do-they-work/

Yeah, I understand what tariffs are. I'm not an idiot. And I understand their use as a carefully targeted strategic tool in some situations. That isn't remotely close to what we have in this instance.

Can you find me a reputable economist, or two, not in the Trump administration, who can make a case for these tariffs, calculated and applied in the way they have done it?

You might enjoy this video, from February. It's largely focused on the US economy. Spoiler: he doesn't think they're going to be beneficial.
https://www.cato.org/multimedia/media-highlights-tv/scott-lincicome-discusses-trump-administrations-tariffs-bulwark

@lawpluslaw

Unfortunately I cannot fully reassure that the US economy is not fucked. But I can safely say that running a persistent $1 trillion trade deficit will definitely (and historically has) screw up the US economy.

Being blunt the tariffs announced are a gamble and they may redress the US trade deficit or they may usher in a trade war and global economic downturn. But if there is a global economic downturn then the US as a net importer will suffer less than those countries running trade surpluses (not that this will be much consolation to those US citizens that do suffer).

So, really, you don't stand behind this assertion at all

You've hit the nail on the head here. The problem on this thread is that because of many poster's loathing of Trump as an individual (an opinion by the way that I share) then they have to believe that all Trump's policies must be bad. It is possible for the individual to be bad but some of their policies correct. Unfortunately their dislike of the individual blinds them in understanding economics.

What you really meant, in your post, then, had nothing to do with people's dislike of Trump blinding their understanding economics, because you don't understand tariffs beyond the 101 explainer that you posted, or why that's simplistic and irrelevant in this situation. Quite a few of us do loathe Trump and understand economics. Again, the video I posted is excellent.

What you actually meant, according to your post above, is that you think he's taken a gamble, with an economy that The Economist referred to as the envy of the world in October 2024 and you can't find any reputable economists (again, outside of the Trump administration) who support his actions, whether from a global or domestic perspective.

Good night.

I expect the US will be the worst hit. Either Trump & Co wrongfully think it to be a really good idea for the economy, or the true intention is to make US business owners beholden to him (providing an opportunity for corruption and/or leveraged political support).

My worry, though, is that when this all goes south, Trump will play distraction by invading Greenland or something else highly inflammatory.

So where does penguin island come into it? If it was that clever, why was it done in such a hurry that even uninhabited islands were listed and charged.

We can only wait and see.

In the meantime, we watch diligently for other things, because I cannot help but think that if the tariff charges were done in that much of a hurry, it was to divert the world's attention from something else.

Look how the discussion is going on here - and every country in the world inhabited by people.

I hope that something else isn't connected to Russia, but I fear it might be.

Some things Trump has done are sensible for the US but the way he has done it appears crass and to cause possibly ongoing problems -a tanked stock market is ok if you can wait several years for things to right themselves but if you have just retired and your investments you were relying on to fund your retirement have plummeted, not so good. Sacking all the civil servants.
Angering the whole world with tariffs and slashed Aid budgets. Putting tv presenters and celebrities in senior posts.
Causing trade instability by changing the rules 5minutes after announcing them.
Also much manufacturing is automated -are they really going to make lots of jobs ?

But the underlying wish to sort deficits in the economy is a good thing that the EU and especially the U.K. needs to fix. No one saved for the costs of the ageing population, the pensions and medical and social care. We are stuffed in the U.K. with huge interest payments to cover and no way of paying it, just passing it to the next generation. Immigration we aren’t dealing with and the housing costs are dire and somehow no Gov can sort it. We need a shake up here.

The damage to an economy will all be to the USA, US farmers have now lost a huge market in China... or how will their farmers now afford the tractors imported?
Watch Tesla et al car sales tank even further...

Countries and their peoples already pissed off with Trump/USA will now avoid their goods, regardless of tariffs.

In my hobby, cycling, i have been considering a Sram - US company - equipped bicycle, not anymore, it'll be a Japanese Shimano one or even an Italian one......

Far more widely & importantly, Sram equipped bicycles are now going to be priced out of the market, a market they were making significant inroads in.... just one example of Trump's either stupidity or corruption... why for example were no additional tariffs announced on Russia???

You bang on about trade deficits, yet the USA has remained one of the top 3 economies in the world.
Trade deficits are a very crude measure of economic success or not eg a poor country export diamonds, wont be buying much from the USA.

Re-shoring wont happen, you tell me how long it will take eg Apple to start up a factory in California, where they would get the chipsets from, the equipment, the skilled staff and with the US in recession, who will be able to afford the now more expensive iphones? and why would they, when this policy may not even last out the year?
Though its affects on the world economy and US relations, will take many years to be rebuilt.

On your claim of 100m 16- 64yo's economically in active..... BS, the average school leaving age is 18, then there is college, which normally takes another 4 years.... SAHM's, the sick/disabled/retirees...

@Slimbear We pay hyper interest rates because of Truss, at one point, 3x the EU average.... Truss is another moron.... the US will now see bond yields rockets and their deficit soar...

Why is trade deficits soooo bad? some of the worlds poorest countries run trade surpluses.
The US runs a trade deficit, yet is one of the worlds, per capita, richest countries in the world &has a relatively low employment rate, their societal inequalities are purely down to people like trump hoarding their money.

Not saving for retirement is a result of Govt policy, we could have an Govt backed insurance saving scheme for our old age, as proposed in the 2000s, never done.

We do not like Trump but also his policies don't make any sense.
The most likely scenario is that prices in America are going to go up because tariffs are collected by the importer when they collect imports at the border. American importers will pay for American tax and not the foreign exporters. The cost will be split with their customers.

The 39% EU tariff against the EU is an arbitrary number Trump & Co came up with with a made up formula. The average tariff rate between EU and US is 2.5%.

From the Irish Times opinion article today, Sat 5th April.

I can see why Trump wants Greenland - no point relocating a microchip factory to the US if you then depend on other countries for the rare earth metals. The exporting countries could charge him for the metals. So he needs his own supply, Ukraine, Greenland.

• UK general government gross debt was £2,537.0 billion at the end of Quarter 1 (Jan to Mar) 2023, equivalent to 100.5% of gross domestic product (GDP).

For comparison with

The U.S. has run a deficit for the last 20 years, substantially increasing the national debt. In fact, according to the Department of the Treasury, the current debt is $31.4 trillion.
In January 2023, the U.S. hit its debt ceiling, also known as its borrowing limit. While some countries tie their debt to GDP, the U.S. sets an exact limit in dollar terms.
The government would run out of money to pay its debts this summer if the ceiling is not raised, though policymakers have historically agreed to debt ceiling increases in the past to avoid a default. In 2011, the U.S. narrowly avoided default due to a last-minute debt ceiling negotiation and the country’s credit rating was downgraded as a result.

I think this is what Trump is wanting to resolve.

So how is forcing the US into a recession & possibly the world too, reducing trade, going to solve a debt crisis?

Their credit rating is still AA+

China, despite being a manufacturing power house, has a debt to GDP ratio of 84% & increasing.

You re falling into the trap that you believe Trump is starting from a position to do good.... and not a form of disaster capitalism, where the wealthy can buy up stock cheaply....

Nothing of the sort. No one is even trying to pretend he has a strategy to resolve anything even close to that.

What he wants is

To try to force other countries to bend the knee so he can shake them down

To raise taxes on ordinary Americans to fund his tax break for billionaires and large corporations.

So far, no one's uttered a word on what is he's planning to do doing with revenues from this increased tax on Americans. Does he have a comprehensive plan on how to to invest it back into building the economy?
No.
He wants to spend it on tax breaks for billionaires and large corporations.
Fun fact:
His own 2017 tax bill instituted lower tax rates for profits made overseas than profits made in the US, literally encouraging companies to offshore their business.

And Trump wants to raise the debt ceiling
https://www.politico.com/live-updates/2025/03/25/congress/trump-told-senate-gop-he-wants-debt-limit-in-tax-bill-00247458

Increasing a very small number of manufacturing jobs, dependent on an international supply chain (because at the moment almost everything that can be made domestically relies on a foreign part or piece and will for the foreseeable future) is going to do nothing to solve those problems The NY bureau chief for The Economist said yesterday that even best case scenario, the very small number of manufacturing jobs that might be created doesn't come close to outweighing the harm this will cause for the vast majority of the country

And another thing to point out is that what this effectively does is drive up costs so small businesses and family farms are unsustainable, leaving them to be bought up by large corporations, VC firms and oligarchs.

More resources into the hands of the few.

Anyone seen the most recent The Rest is Politics US?

I'm generally not as big of fan of it as I am the UK version, in part because I find Scaramucci and Katty Kay a little less outraged by Trump's actions.

What I found alarming, though, and had not previously considered, was their discussion (based in part on concerns expressed to them from some in Washington) is that Trump might be deliberately crashing the US economy in order to impoverish Americans as part of the wider, fascist power grab. It makes a fair amount of sense, too.

Weaken the courts, weaken congress and the senate, weaken businesses and the people. All power to the President.

@ElbowsUp I agree, but I also thought this was interesting on The Rest is Politics at 4.57 up to about 7.13

https://www.youtube.com/live/43u3JxB6Umo?si=gwTLUG2lOjwA-N1h

Tariffs can be a gateway to corruption.

@ThisRoseReader that’s for sure, the EU and their enthusiastic embrace of tariffs and other restrictions is a classic example.

Is he intelligent enough to work this out?

It could affect prices eg UK farmers getting more for their produce when China looks for suppliers other than USA. So many knock on effects yet to materialise.

One thing that occurred to me is that the US is quite a religious country -much more so than the U.K. - how are all these people feeling about the slashing of USAID to developing countries. Putting high tariffs on poor African countries,for example. Don’t seem to hear much criticism.

I think he might be or, at least, the Project 2p25 fms around him are. He's long been infatuated by dictators and, in his first term, was frustrated with his inability to use unfettered power.

I would say that erosion of democratic systems and norms, along with trade wars, have been the main focus of his first months back in office, and perhaps they are more related than first appeared.

I am wondering now if, after considering the deportations and revoking visas, he could be on a white supremacy ticket without making it too obvious.

The only way America can be first is to cause other countries to decline. America does not have the ability to be great all on it's own.