Before former president Donald Trump spoke to the Economic Club of New York this month, he prepped for the crowd of Wall Street power brokers and other traditional business elites who would be in attendance.<\/p>\n
Trump consulted with Steven M. Mnuchin and David Malpass, his former treasury secretary and his appointee to lead the World Bank, two people familiar with the matter said. But then the Republican presidential nominee surprised his audience, calling in a speech for the creation of a U.S. sovereign wealth fund paid for by new revenue from sweeping tariffs on trade. Neither adviser had suggested that idea, the people said, speaking on the condition of anonymity to describe private conversations.<\/p>\n
The gap between what Trump\u2019s advisers recommended and what he ultimately espoused underscores the awkward position Republican lawmakers and many other conservatives find themselves in over the former president\u2019s increasingly extreme trade proposals.<\/p>\n
On Capitol Hill, Republicans who support Trump but oppose his tariffs have downplayed his plans since his first run for president eight years ago, justifying them as necessary to bolster the U.S. position in global trade negotiations. This interpretation has also been popular among the conservative economic advisers close to Trump, who have embraced his tax cuts and pro-business agenda despite his protectionist instincts.<\/p>\n
Trump floats tariffs \u201cas a tool to get what we want,\u201d Rep. Dan Meuser (R-Pa.) said in an interview. \u201cIt\u2019s messaging. But it\u2019s a promise. And that\u2019s why he\u2019s talking about it \u2014 to set the tone.\u201d<\/p>\n
But the former president has repeatedly undermined this view of his trade agenda, reiterating in his campaign speeches and proposals that he sees tariffs as a positive force for the U.S. economy rather than as a necessary evil.<\/p>\n
Trump recently said tariffs \u201cdon\u2019t affect our country,\u201d contradicting mainstream economists, and has implausibly claimed they can solve everything from foreign policy crises to inflation.<\/p>\n
\u201cTariffs are the greatest thing ever invented,\u201d he said Tuesday night in Michigan.<\/p>\n
After imposing tariffs on roughly $380 billion in imports during his first term, primarily on China, Trump is now calling for import duties of varying levels on all $3 trillion in U.S. imports \u2014 while also suggesting the revenue they bring in could be used to pay for some kind of unspecified national child care program and trillions of dollars in new tax cuts.<\/p>\n
A handful of Republican senators have expressed their disapproval of Trump\u2019s most aggressive trade proposals, but the party\u2019s lawmakers overall appear to be hearing what they want to from Trump even as his rhetoric sharply escalates.<\/p>\n
\u201cThe Republican officials I talk to are hoping that this is just Trump\u2019s bluster \u2014 that he\u2019s not actually serious about imposing tariffs but is rather using tariff threats to bully other nations into becoming more friendly to the U.S.,\u201d said Brian Riedl, who served as an aide to former senator Rob Portman (R-Ohio), a free-trade proponent. \u201cBut they\u2019re in denial about this.\u201d<\/p>\n
Republican National Committee spokeswoman Anna Kelly said Trump secured \u201cthe best trade deals in history\u201d and would again advance an \u201cAmerica First\u201d trade agenda.<\/p>\n
\u201cPresident Trump successfully imposed tariffs and negotiated new trade deals that leveled the playing field for American agriculture and manufacturing \u2014 allowing U.S. industries to send more made-in-America goods across the world,\u201d Kelly said.<\/p>\n
During his first term, Trump primarily pushed tariffs as necessary to counter Beijing\u2019s trade practices. Trump repeatedly hammered China for stealing the intellectual property of U.S. firms and manipulating the value of its currency \u2014 criticisms that paved the way for his 2018 trade war with China.<\/p>\n
Trump also picked trade battles with the European Union and imposed tariffs against Mexico and Canada as he renegotiated the North American Free Trade Agreement. But Republicans in the House and Senate, as well as the numerous free-trade proponents in his Cabinet, tried to keep these impulses in check. GOP Sens. Mitch McConnell (Ky.), Ron Johnson (Wis.) and Ted Cruz (Tex.) raised objections to his proposed tariffs on Mexico in 2019, for instance, while Mnuchin and former Trump White House economist Larry Kudlow sometimes worked to limit the scope of his trade plans.<\/p>\n
Though controversial at the time, Democrats have since backed much of Trump\u2019s changes to U.S. trade policy, with President Joe Biden keeping most of his predecessor\u2019s tariffs in effect.<\/p>\n
Since leaving office, however, Trump has dramatically intensified his trade rhetoric and proposals, fueling fears a second term would lead to a global trade war that Democrats are highly unlikely to ever back.<\/p>\n
At the outset of the 2024 presidential race, Trump proposed a 10 percent \u201cautomatic\u201d tariff on every U.S. trading partner, targeting all $3 trillion in annual imports. He said on television that he wanted to put a \u201cring around the collar\u201d of the U.S. economy. In August, Trump suggested that the rate could instead be as high as 20 percent.<\/p>\n
The nonpartisan Committee for a Responsible Federal Budget estimated the 10 percent universal tariff could raise $2.5 trillion in new federal revenue. A 20 percent tariff would raise significantly more, but not twice as much. That\u2019s because higher tariff rates lead to fewer imports.<\/p>\n
The economic consequences of such a measure could be severe. The median household would see its after-tax income fall by more than $2,600, or about 4.1 percent, according to an analysis by the Peterson Institute for International Economics, a Washington-based think tank. That\u2019s not accounting for the erratic ways that global trade flows would probably be affected.<\/p>\n
But Trump has been unbowed, continuing to turn to tariffs as a kind of cure-all.<\/p>\n
Asked at the Economic Club of New York about high child care costs, he cited tariff revenue as one potential answer. Trump also incorrectly said tariff revenue from his plans can be used to pay for roughly $7 trillion in new tax cuts. More recently, Trump floated using a \u201c100 percent\u201d tariff to force belligerent countries not to go to war.<\/p>\n
\u201cWe don\u2019t have to send troops; I can do it with a telephone call,\u201d he said. \u201cYou go to war with another country that\u2019s friendly to us, or even not friendly to us, you\u2019re not going to do business in the United States, and we\u2019re going to charge you 100 percent tariffs.\u201d<\/p>\n
Sometimes, Trump characterizes this kind of effect as the purpose of the tariff \u2014 to bend foreign nations to America\u2019s will. Beyond Trump, many skeptics of U.S. trade policy over the past 20 years have emphasized that other countries have far higher import duties on U.S. exports than the other way around. One iteration of Trump\u2019s trade plans would allow the United States to tariff a country\u2019s imports at the same rate that country tariffs U.S. exports.<\/p>\n
\u201cSo it\u2019s basically you hurt us, we hurt you,\u201d Trump said last month. \u201cIt\u2019s an eye for an eye, and it\u2019s common sense.\u201d<\/p>\n
GOP lawmakers have mostly chosen to believe this will form the crux of Trump\u2019s trade policy. There have been some objections: Sen. John Thune (R-S.D.) and other GOP senators have criticized Trump\u2019s plans for an \u201cautomatic\u201d 10 percent tariff. One moderate Republican, speaking on the condition of anonymity to talk candidly about the issue, said that Trump\u2019s tariff proposals would only hurt Americans, particularly poorer citizens, because the prices of goods would immediately go up.<\/p>\n
But Rep. Kevin Hern (R-Okla.), who chairs the Republican Study Committee, is one of many in the GOP who say they consider Trump\u2019s positioning on tariffs more of a warning to foreign leaders than a specific policy.<\/p>\n
\u201cHe\u2019s put a notice out there to people around the world: If you\u2019re going to do harm to our U.S. economy, we\u2019re going to retaliate,\u201d Hern said. \u201cHe\u2019s given them forewarning.\u201d<\/p>\n
Sen. Markwayne Mullin (R-Okla.) worked with Trump on trade policies when he was in the House. He said Trump\u2019s latest pontifications on tariffs tell him that the former president is arguing for free trade, \u201cbut equal access across the board.\u201d<\/p>\n
\u201cSo his whole thing is, if you\u2019re going to trade with us and you\u2019re not going to give us free access \u2026 like we treat your businesses, you treat ours, then we\u2019re going to impose tariffs. So I know where he\u2019s coming from, but we got to work on where those tariffs need to be, and I agree with his plan,\u201d he said. Asked whether he views Trump\u2019s recommendations more as messaging and that a GOP Congress would ultimately piece together tariff recommendations, Mullin said \u201cyes, 100 percent.\u201d<\/p>\n
Trump, however, continues to openly discuss tariffs in a different light.<\/p>\n
During a speech in Pennsylvania this month, he said tariffs are \u201ca tax on a country that\u2019s ripping us off and stealing our jobs. \u2026 It\u2019s a tax that doesn\u2019t affect our country.\u201d<\/p>\n
At the Economic Club of New York, Trump said tariffs \u201cwill combat inflation.\u201d Economists say that even if tariffs lead to more domestic production, that would be the case only by making imports more expensive \u2014 which would mean higher inflation.<\/p>\n
During a presidential debate, Trump responded to a question on tariffs\u2019 impact on domestic consumers by implausibly asserting they would instead raise prices for foreign countries.<\/p>\n
\u201cThey aren\u2019t gonna have higher prices. What\u2019s gonna have and who\u2019s gonna have higher prices is China and all of the countries that have been ripping us off for years,\u201d Trump said. \u201cOther countries are going to finally, after 75 years, pay us back for all that we\u2019ve done for the world.\u201d<\/p>\n
While his exact intentions are hard to discern, Trump is leaving little room for interpretation \u2014 he clearly plans to use tariffs in a way that most Republicans will ultimately dislike, said Doug Holtz-Eakin, president of the American Action Forum, a center-right think tank.<\/p>\n
\u201cShould we be prepared for a Trump administration to levy across-the-board tariffs? Yes. How big will they be? How disruptive will they be? Who knows,\u201d Holtz-Eakin said. \u201cBut Trump is not going to be put under control. He\u2019s making that point.\u201d<\/p>\n<\/p>\n
Before former president Donald Trump spoke to the Economic Club of New York this month, he prepped for the crowd of Wall Street power brokers and other traditional business elites who would be in attendance. Trump consulted with Steven M. Mnuchin and David Malpass, his former treasury secretary and his appointee to lead the World […]<\/p>\n","protected":false},"author":0,"featured_media":9860,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-9859","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-politics"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/9859","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=9859"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/9859\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/9860"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=9859"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=9859"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=9859"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}