Now he thinks he gets credit for backing off
Four points:
1. A 30 percent tariff is still really, really high, especially combined with the 10 percent tariff we’re imposing on everyone else. The back of my envelope says that the average U.S. tariff rate will now be around 13 percent, up from around 3 percent when Trump began his trade war. Before all this drama that would have been seen as wildly protectionist.
2. This wasn’t a case of both sides backing down. China only imposed its tariffs as a response to Trump’s gambit, and has reduced them only because he retreated. And retreat he did. This was basically Trump running away from the killer rabbit.
3. The prohibitive tariff has been paused, not canceled. Nobody knows what will happen in 90 days. I’ve long argued that the uncertainty created by Trump’s arbitrary, ever-changing tariffs is at least as important as the level of those tariffs. Well, the uncertainty level has arguably gone up rather than down.
4. This retreat probably hasn’t come soon enough to avoid high prices and empty shelves. Even if shipments from Shanghai to Los Angeles — which had come to a virtual halt — were to resume tomorrow, stuff wouldn’t arrive in time to avoid exhaustion of current inventories.
I guess we all knew it. But it’s probably important to document it. I see far too many MSM pundits saying we can all breathe a sigh of relief that the trade war is over.
The inflation report today was very good. But all it says is that inflation was going down and things were going very well until “liberation day” ffucked the whole thing up. If Trump wasn’t a demented narcissist he would have ridden the Biden soft landing to victory. Instead, we’re looking at recession. Heckuva job.