Why does the press not correct Trump that it is American consumers that pay the tariffs, not the countries themselves, as Lawrence O'Donnell commonly talks about?
Seriously, how is it possible that the supposed Wharton grad fundamentally misunderstands how tariffs work, or what nuance or exceptions are we discounting? Surely he is not quite so simple minded and ignorant as to believe that foreign exporters pay tariffs directly to the US Treasury? Or what is his “vision” and what is his fantasy of a long-term strategy? Does anybody know?
First, I don't think he honestly cares who pays these tariffs. It's new money into the Treasury that he can claim as a "win." Secondly, I question whether tariff revenue is even his primary objective, but rather just cover for him to play "Big Man" on a global basis. I think his role in The Apprentice is very telling of his desperate need to gain attention and exert control over others. One can only imagine what it must have been like to grow up in the Trump household.
You are assuming he went to class and studied. I think he figured out every possible way to get someone else to do the work for him. His older sister Mary said he cheated his way through school.
This is a great deconstruction of the current situation. However, as Mr. Bernstein mentions at the end of the essay, there’s a highly unstable person making trade decisions on tariffs (and a lot else too).
As my economics teachers mentioned long ago, business leaders want predictability. So do most people.
Instincts help us a lot, but not so much when considering macroeconomic policy. Expertise matters.
It’s so confounding how the press breathlessly covers Trump’s “dealmaking” as though this is all part of some brilliant scheme rather than the haphazard, unfocused, damaging dick-swinging that it is.
The problem is not his lack of economics knowledge. Tariffs appeal to Trump because they create power. Domestic businesses wanting tariff waivers have to buy his memecoin or contribute to his campaign funds. Foreign sovereigns have to bend the knee one way or another.
I don't think Trump's tariff obsession is about economics at all.
In all analysis of Trump's actions (or failure to act) it is important to keep focus on the role of the large Christian Nationalist machinery that has planned almost all of this. The tariffs partially can be included in this. They have a strong belief in autarky. It is not just getting rid of non-white immigrants, it is not having any evidence of the skills of non-white foreigners improving the living standards of White Christians. We know something of Vought's and other's plans from Project 2025, but this was published. Much of it is certainly kept secret. There is little to distinguish the theology and political goals of today's Christian Nationalists who control most of the US government today from both pre and post US Civil War periods. Why did the pre-civil war South have few and vastly inferior railroads to the North? Except when you have one or just a few natural resources for White man to exploit (which figure prominently in all Calvinist theology as a gift from God) railroads, which economically need bilateral trade, and also allow bilateral movement of people, are a threat to this theology. Similarly the South didn’t really create any significant colleges or universities because these were also a threat to them, both from cultivating reason and the corresponding need for intellectual interaction with others outside the White Calvinist Culture. Fossil fuels are the perfect natural resource to exploit in the Calvinist model. (I live in Colorado, near where a freight line runs from Western Colorado and more importantly Wyoming, where daily very long trains haul coal and oil into the Denver train yards. They naturally go back empty. ).
Trump is a moron and an ignoramus with no attention span. Suzie Wiles spends much of her time arranging the production of Fox News imitating videos to convey the plans of the vast Christian Nationalist machinery actually planning and executing to Trump. In his usual incoherent speaking style sometimes phrases slip out of his mouth that are almost certainly fed to him on these videos. Trump is a psychopath easily manipulated by others: give hime effusive ludicrous public praise and more importantly give him people or organizations or countries to hate and he responds. Everything put out by the administration claims it is following Trump’s plan, but there is no plan. The use of the Military and the mass deportations were part of Vought’s planning. He thought they would have to invoke the Insurrection Act to use the US Military in law enforcement, but primarily in the arrest and deportation of non-White immigrants. With no pushback from a compliant GOP Congress and the Supreme Court they haven’t yet had to invoke the act to use the Military. There are future plans to use more Marines in deportations in places like Boston and New York City.
The Golden Age is a well worn phrase in today’s Calvinist Christian Nationalist movement, but it has almost nothing to do with economic growth (outside of the exploitation of natural resources) but a vision almost identical to the pre-Civil War South, with White men dominating all of society. Economics is not really at all part of the Golden Age, but Trump is so easily manipulated and ignorant they can feed him this.
From the British journalists secretly taped 2024 interview with Vought:
“Vought said the expulsion of millions of undocumented immigrants could help “save the country.”
Once deportations begin, “you’re really going to be winning a debate along the way about
what that looks like,” Vought said. “And so that’s going to cause us to get us oR of
multiculturalism, just to be able to sustain and defend the deportation, right?””
Dear Dr. Bernstein: Thank you this is a great analysis. I've been wondering about the consumer price increases, which hurt the Biden administration so much despite its overall economic accomplishments. (As you know all too well!)
I had another fundamental question: do you believe that reducing the current account deficit is a worthwhile policy goal? Or is it not just the means but also the ends of the tariff way that are wrong?
Thank you that was an informative discussion with Ernie Tedeshi. Interesting that he suggests cutting the budget deficit would reduce the trade balance. If anyone is interested, the link is here https://contrarian.substack.com/p/lets-do-lunch-0715. I appreciated you bringing up the china shock. You said that you could spend an hour on the question of whether trade and globalization have been beneficial. I hope that happens on one of the "let's do lunches".
Here is an example. Our LG Washwasher laundry made in Korea went up 20% after the tariffs. My preparations for the machine weren't quite done so we couldn't order it earlier. Then the tariffs hit. So I was following the price for 6 months and then the price increase hit and we said we better do it NOW! So it was $400 additional for the laundry. And it didn't matter who you bought it from.
None of his lackeys have the professional training needed to correct him.
Donald doesn’t do “corrections” .. that’s why those individuals were chosen
More the lack of intestinal fortitude than the lack of professional training.
Why does the press not correct Trump that it is American consumers that pay the tariffs, not the countries themselves, as Lawrence O'Donnell commonly talks about?
Seriously, how is it possible that the supposed Wharton grad fundamentally misunderstands how tariffs work, or what nuance or exceptions are we discounting? Surely he is not quite so simple minded and ignorant as to believe that foreign exporters pay tariffs directly to the US Treasury? Or what is his “vision” and what is his fantasy of a long-term strategy? Does anybody know?
First, I don't think he honestly cares who pays these tariffs. It's new money into the Treasury that he can claim as a "win." Secondly, I question whether tariff revenue is even his primary objective, but rather just cover for him to play "Big Man" on a global basis. I think his role in The Apprentice is very telling of his desperate need to gain attention and exert control over others. One can only imagine what it must have been like to grow up in the Trump household.
You are assuming he went to class and studied. I think he figured out every possible way to get someone else to do the work for him. His older sister Mary said he cheated his way through school.
No illusions there. But that was just a snide aside anyway, not my question.
He IS that stupid. Didn’t you hear his take on the Great Depression??
I'm wondering whether Trump supporters will notice higher prices? Fox News will tell them prices have come down and they will believe it.
Just more detergent to throw into the Fox News brainwashing machine.
The 'pt' will get higher over time as firms' costs destroy their embedded profits.
Could be that none of his lackeys knows to correct him!
This is a great deconstruction of the current situation. However, as Mr. Bernstein mentions at the end of the essay, there’s a highly unstable person making trade decisions on tariffs (and a lot else too).
As my economics teachers mentioned long ago, business leaders want predictability. So do most people.
Instincts help us a lot, but not so much when considering macroeconomic policy. Expertise matters.
It’s so confounding how the press breathlessly covers Trump’s “dealmaking” as though this is all part of some brilliant scheme rather than the haphazard, unfocused, damaging dick-swinging that it is.
The problem is not his lack of economics knowledge. Tariffs appeal to Trump because they create power. Domestic businesses wanting tariff waivers have to buy his memecoin or contribute to his campaign funds. Foreign sovereigns have to bend the knee one way or another.
I don't think Trump's tariff obsession is about economics at all.
Evan Kraft
American University
"Correcting Trump" would be like turning lead into gold.
In all analysis of Trump's actions (or failure to act) it is important to keep focus on the role of the large Christian Nationalist machinery that has planned almost all of this. The tariffs partially can be included in this. They have a strong belief in autarky. It is not just getting rid of non-white immigrants, it is not having any evidence of the skills of non-white foreigners improving the living standards of White Christians. We know something of Vought's and other's plans from Project 2025, but this was published. Much of it is certainly kept secret. There is little to distinguish the theology and political goals of today's Christian Nationalists who control most of the US government today from both pre and post US Civil War periods. Why did the pre-civil war South have few and vastly inferior railroads to the North? Except when you have one or just a few natural resources for White man to exploit (which figure prominently in all Calvinist theology as a gift from God) railroads, which economically need bilateral trade, and also allow bilateral movement of people, are a threat to this theology. Similarly the South didn’t really create any significant colleges or universities because these were also a threat to them, both from cultivating reason and the corresponding need for intellectual interaction with others outside the White Calvinist Culture. Fossil fuels are the perfect natural resource to exploit in the Calvinist model. (I live in Colorado, near where a freight line runs from Western Colorado and more importantly Wyoming, where daily very long trains haul coal and oil into the Denver train yards. They naturally go back empty. ).
Trump is a moron and an ignoramus with no attention span. Suzie Wiles spends much of her time arranging the production of Fox News imitating videos to convey the plans of the vast Christian Nationalist machinery actually planning and executing to Trump. In his usual incoherent speaking style sometimes phrases slip out of his mouth that are almost certainly fed to him on these videos. Trump is a psychopath easily manipulated by others: give hime effusive ludicrous public praise and more importantly give him people or organizations or countries to hate and he responds. Everything put out by the administration claims it is following Trump’s plan, but there is no plan. The use of the Military and the mass deportations were part of Vought’s planning. He thought they would have to invoke the Insurrection Act to use the US Military in law enforcement, but primarily in the arrest and deportation of non-White immigrants. With no pushback from a compliant GOP Congress and the Supreme Court they haven’t yet had to invoke the act to use the Military. There are future plans to use more Marines in deportations in places like Boston and New York City.
The Golden Age is a well worn phrase in today’s Calvinist Christian Nationalist movement, but it has almost nothing to do with economic growth (outside of the exploitation of natural resources) but a vision almost identical to the pre-Civil War South, with White men dominating all of society. Economics is not really at all part of the Golden Age, but Trump is so easily manipulated and ignorant they can feed him this.
From the British journalists secretly taped 2024 interview with Vought:
“Vought said the expulsion of millions of undocumented immigrants could help “save the country.”
Once deportations begin, “you’re really going to be winning a debate along the way about
what that looks like,” Vought said. “And so that’s going to cause us to get us oR of
multiculturalism, just to be able to sustain and defend the deportation, right?””
Dear Dr. Bernstein: Thank you this is a great analysis. I've been wondering about the consumer price increases, which hurt the Biden administration so much despite its overall economic accomplishments. (As you know all too well!)
I had another fundamental question: do you believe that reducing the current account deficit is a worthwhile policy goal? Or is it not just the means but also the ends of the tariff way that are wrong?
Good question. I'll be sure to raise it at the next Let's Do Lunch, the econ Q&A show I host Tuesday's at noon EST at the Contrarian website.
Thank you that was an informative discussion with Ernie Tedeshi. Interesting that he suggests cutting the budget deficit would reduce the trade balance. If anyone is interested, the link is here https://contrarian.substack.com/p/lets-do-lunch-0715. I appreciated you bringing up the china shock. You said that you could spend an hour on the question of whether trade and globalization have been beneficial. I hope that happens on one of the "let's do lunches".
Here is an example. Our LG Washwasher laundry made in Korea went up 20% after the tariffs. My preparations for the machine weren't quite done so we couldn't order it earlier. Then the tariffs hit. So I was following the price for 6 months and then the price increase hit and we said we better do it NOW! So it was $400 additional for the laundry. And it didn't matter who you bought it from.