Michael Hiltzik
Are you confused about Donald Trump’s tariff policy, including why he instigated a global trade war, what its impact will be on the U.S. economy and how hard it will hit your pocketbook?
Join the club. So too are economists, trade experts, political prognosticators and Trump himself. Their bewilderment has only intensified with the White House’s recent announcement of trade “deals” with Britain and China.
Those quote marks are proper, because it’s unclear how much of a bargain Trump has struck with those countries despite his triumphalist rhetoric.
Running a trade deficit is nothing new for the United States. Indeed, it has run a persistent trade deficit since the 1970s—but it also did throughout most of the 19th century.
— Brian Reinbold and Yi Wen, Federal Reserve Bank of St. Louis
On Monday, for instance, Trump declared that he had achieved a “total reset” in trade relations with China. That doesn’t appear to be true, given that the thrust of the announcement was a 90-day pause in the recent round of U.S.-imposed tariffs on Chinese goods and retaliatory Chinese levies on goods imported from the U.S.
Indeed, the announcement appears at least superficially to represent another climb-down by Trump of the stern tariff regime he claimed to be imposing. No one is even sure that the purported cease-fire will survive for the full 90 days. Even if it does, it means 90 days of continued uncertainty about the relations between the two largest economies on the planet.
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