Except it can’t all be true. The tariffs can’t simultaneously bring back manufacturing and make the US self-sufficient while also raising so much revenue that Congress can start doing away with income tax.
And Americans aren’t seeing it through Trump and Navarro’s rose-coloured glasses. Consumer confidence is plummeting, polls show people want the president to focus on lowering prices, not tariffs, and US markets had their worst start to a year since 2022.
White House press secretary Karoline Leavitt said Trump didn’t care about the sell-off.
“The president has always said the stockmarket is a snapshot of a moment in time, and he’s doing what’s best for Main Street, and Wall Street will work out just fine.”
Economists are not persuaded. Steven Hamilton, a former Australian Treasury official turned economics professor at George Washington University, said he had no doubt Americans would be worse off.
“Tariffs will predominantly be paid by American consumers and workers in higher prices and lower wages,” he said. “And the revenue the tariffs raise is relatively modest, so will finance only modest tax relief.”
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And Michael Strain, director of economic policy studies at the American Enterprise Institute, said the results of Trump’s first-term tariff policies showed the touted effects never materialised.
“Trump’s trade war will fail at its goals of reviving domestic manufacturing employment, boosting output in the manufacturing sector, and reducing the trade deficit,” Strain wrote on Monday in the US.
Of course, there are other nationalistic and geopolitical goals at play here, as Kevin Roberts, president of the conservative Heritage Foundation, laid out in a thread on X.
One was to “level the playing field” by forcing other countries, including US friends and allies, to drop their tariffs, foreign ownership restrictions, labelling laws and other pieces of red tape.
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Another was to decouple the US economy from China “and presents our allies with a clear choice: develop partnerships with the US and get the many benefits that come, or side with China and face US tariffs”.
Trump and his team have greater resolve this time around, buoyed by the emphatic election win and the key economic indicators from Trump’s first term. They are determined to be bolder, go further and move faster.
But at some stage they may have to face reality. As big and important as the US is, it doesn’t hold all the cards. And if prices rise and the economy slows, “Liberation Day” will come to look more like a date with disaster.
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