US President again Donald Trump and his owners are going hog wild on tariffs. He did the same thing during his first term as president; the results were not good. Tariffs, being passed on to the consumer, increased inflation and amounted to a tax on US citizens. The higher cost of doing business with the US slowed GDP, this in turn slowed taxes from corporations and sales. Coupled with Trump’s current plan to reduce taxes on corporations and the wealthy by $4.7T, that’s right – trillion, will swell deficit spending.

Here’s what some studies said about his first term tariffs.

A study published in fall 2019 in the Journal of Economic Perspectives found that by December 2018, Trump’s tariffs resulted in a reduction in aggregate U.S. real income of $1.4 billion per month in deadweight losses, and cost U.S. consumers an additional $3.2 billion per month in added tax. The study’s authors noted that these were conservative measures of the losses from the tariffs, because they did not take account of the tariffs’ effects in reducing the variety of products available to consumers, or the tariff-related costs attributable to policy uncertainty or the fixed costs incurred by companies to reorganize their global supply chains. A study by Federal Reserve Board economists found that the tariffs reduced employment in the American manufacturing sector. – Wikipedia

Between the time Trump took office in 2017 through March 2019, the U.S.’s trade deficit grew by $119 billion, reaching $621 billion, the highest it had been since 2008. As of January 2020, the Trump administration had imposed tariffs on 16.8% of all goods imported into the U.S. (measured as a share of the value of all U.S. imports in 2017). Wikipedia

The Congressional Budget Office (CBO) published its estimate of the U.S. economic impact from Trump’s trade policies: In CBO’s estimation, the trade barriers put in place by the United States and its trading partners between January 2018 and January 2020 would reduce real GDP over the projection period. The effects of those barriers on trade flows, prices, and output are projected to peak during the first half of 2020 and then begin to subside. Tariffs are expected to reduce the level of real GDP by roughly 0.5 percent and raise consumer prices by 0.5 percent in 2020. As a result, tariffs are also projected to reduce average real household income by $1,277 (in 2019 dollars) in 2020. CBO expects the effect of trade barriers on output and prices to diminish over time as businesses continue to adjust their supply chains in response to the changes in the international trading environment Wikipedia

Can we make the argument these tariffs are an intentional effort to destroy the US and possibly the world’s economy? Maybe. Similar tariffs were part of the 1930 Smoot-Hawley Tariff Act. This was one of the causes of the Great Depression. The Great Depression is what attracted people in Europe, particularly Germany still suffering from World War I debt, to National Socialism. No one listened to Hitler until the Great Depression hit.

“’In 1930, 1,028 economists urged Congress to reject the protectionist Smoot-Hawley Tariff Act,’ the authors write, citing a trade act that many economists argue was one of the triggers for the Great Depression.” (The Guardian)

Another point; creating a recession in the United States will hurt the US and it’s trading partners, notably her NATO allies. Currently Trump is on a path toward halting aid to Ukraine while demanding an increase in support from European nations. These same NATO allies will be economically damaged by a trade war. Presumably BRICS nations will not be affected as severely. Creating a recession in the US will help Vladimir Putin.

Related;

• Is the White House trying to engineer a recession? This Wall Street pro explains the vision. Market Watch
• Economic Warfare for Mother Russia 4dforum.org