I Don't Disapprove of Trump's Strategy, Because He Doesn't Have One
When you're a Tariff Man, you don't need reasons
Trump’s 50 percent tariff on Brazil for the sin of actually putting a would-be dictator on trial was shocking. But in its own way the 30 percent tariff on the EU is just as shocking — because the EU has done nothing to warrant this tariff, and Trump’s letter doesn’t even hint at any action Europe could take to satisfy him.
Here’s the letter, with emphasis on Trump’s complaint:
What is Trump talking about here? If you didn’t know anything about EU policies you might assume that Europe actually does impose significant barriers to US exports, which it could offer to remove. But it doesn’t. According to the World Trade Organization, US nonagricultural exports to the EU face an average tariff rate of 1 percent — that’s right, 1 percent. Agricultural goods face slightly higher barriers, 3.9 percent. Basically, US products already have almost free access to Europe’s market. The EU can’t make trade concessions because there’s nothing to concede.
My advice to the EU is to go ahead and retaliate. Trump says he’ll raise his tariff even higher if it does, but how much more damage can he do? And remember, US consumers will eventually pay Trump’s tariffs.
We’ll presumably hear many attempts to explain the strategy behind all of this, but there clearly isn’t a strategy, just the prejudices of an ignorant man and his enablers.
Maybe the EU can say sth like, "We will reduce our tariffs on American products by 35%," without, you know, saying how small the raw-value amount would be overall.
Maybe Tantrump will fall for it.
I’m a retired CPA, and worked for a company that imported much of its inventory. Yes, a tariff IS a tax. Also, for retail consumers, you will also pay state/local sales taxes on the tariff tax — the cherry on top of this Baloney Sandwich!