On most policy issues, when President Trump states his position, you can tell that he’s blurting out an unformed idea that is always subject to change. No one is really surprised when, a day or an hour later, he says the exact opposite, because when it comes to policy, generally speaking, he doesn’t know and he doesn’t care.
There is one exception, however: trade.
.. Free trade has widely distributed benefits and concentrated costs, while a tariff like this one that is meant to help a particular industry has concentrated benefits and widely distributed costs... There have always been two core ideas underlying his beliefs on trade. The first is that trade is a zero-sum contest in which the only goal is exporting goods. If we import something from another country, even if comparative advantage makes it perfectly reasonable for us to do so, then the other country has “won” and the United States has “lost.”.. Trump’s second idea about trade is that it represents a kind of contest of pride, even manhood. When he talks about trade he nearly always says that other countries, particularly China, are “laughing at us.” When we, say, buy cheap consumer goods from abroad, it means we’re the sucker, the sap, the patsy... Yet you’ve never heard Trump say exactly which provisions of NAFTA he dislikes or what he would change, probably because he doesn’t know himself. He just thinks that trade wars are good, and easy to win... Gary Cohn, the president’s chief economic adviser, tried to argue to him that increased tariffs would hurt the economy by raising prices on goods that contain steel and aluminum, to which Trump replied that it’s “a small price to pay.” Since he sees this issue to be about not just jobs but even more importantly about pride and dignity, that won’t persuade him.From where Trump stands, imposing the tariffs is an end in itself. It shows those foreigners that we won’t be taken advantage of, that we’re big and strong, that nobody’s going to laugh at us and get away with it. It’s “winning.” Even if we wind up losing.
Trump insists ‘trade wars are good, and easy to win’ after vowing new tariffs
Trump is imposing the steel and aluminum tariffs by utilizing legal provision that allows the White House to take steps if it can argue that imports threaten the national security of the United States.
Trump’s comments on Thursday and his Twitter posts on Friday made no mention of national security but, instead, referenced what he said was an unfair dynamic where the U.S. buys more from other countries than those nations buy from the U.S.
.. Canadian officials said the steel and aluminum tariffs would be unacceptable and that they would retaliate if it affected their exports to the United States. A number of other countries also expressed alarm. German politician Bernd Lange, who heads the trade committee at the European Parliament, shot back: “With this, the declaration of war has arrived.”
.. Trump believes that tariffs, even on steel produced by other countries, will help revive the U.S. steel and aluminum industries.
.. trade wars are unpredictable and escalate quickly.
.. Gary Cohn tried to prevent Trump from pursuing the tariffs but was bulldozed by other advisers who thought the changes were necessary and would fulfill promises Trump made while campaigning
.. The three-largest U.S. trading partners are China, Canada and Mexico.
Do You Think Donald Trump Is Ready for a Real Financial Crisis?
The tax law and a push by the Trump administration to increase military spending will reduce federal revenue and force the Treasury to borrow more money when the economy is close to full employment. This could stoke inflation and prompt the Federal Reserve to tighten monetary policy. That, in turn, would slow the economy.
.. The prospect of a recession or financial crisis on Mr. Trump’s watch is unnerving, because he is as confident in his own abilities as he is lacking in knowledge and sound judgment. When confronted with criticism, he lashes out like an intemperate child.
On Monday, he said Democrats who did not applaud during his State of the Union address were un-American and treasonous.
.. If the stock market falls further, will the president try to reassure the public, or will he launch a Twitter fusillade blaming the drop on, say, a conspiracy hatched by the Senate minority leader, Chuck Schumer, and Tom Steyer, the billionaire hedge fund manager who wants Mr. Trump impeached?
.. Instead, he has stacked his administration with incompetent yes men, right-wing ideologues and Washington swamp dwellers. Consider the Treasury secretary, Steven Mnuchin, a former investment banker, who unnerved the currency market last month by suggesting that the United States was trying to weaken the dollar. His statement broke with the longstanding practice followed by Treasury secretaries from both parties to avoid making careless public pronouncements about American currency.
Mr. Mnuchin and Gary Cohn, the White House’s chief economic adviser, also debased their credibility last year by arguing with no evidence whatsoever that the Republican tax cut would pay for itself.
.. Paul Ryan, tried to pass off as good economic news that a public school secretary would take home an extra $1.50 a week as a result of the tax law.
.. Mr. Ryan, for one, is citing the deficit to make the case that the government needs to slash Medicaid, Medicare and other important government programs. Other members of his party are using the deficits to argue that the government cannot afford to repair and upgrade the country’s dilapidated infrastructure.
Sec. Steve Mnuchin Refutes Reporter’s Portrayal of Davos as ‘Hangout for Globalists’
One reporter asked Mnuchin of the Trump administration’s decision to send a large delegation to the event: “What is the point of the Trump administration going to a place that is regarded, usually, as a hangout for globalists?”
“Well, I don’t think it’s a hangout for globalists,” Mnuchin shot back.
.. The secretary said the economic team’s purpose at the high-profile gathering “is going to go over and talk about the America First economic strategy.”
President Donald Trump will attend Davos from January 23 to January 26 and it will be lead by Mnuchin. During Thursday’s briefing, Mnuchin said, “We’re thrilled that the president is coming, and I think what we know is that the economy that’s good for the U.S. is good for the rest of the world.”
Other members of the delegation include Secretary of State Rex Tillerson, Secretary of Commerce Wilbur Ross, Secretary of Labor Alex Acosta, Secretary of Transportation Elaine Chao, Secretary of Energy Rick Perry, Secretary of Homeland Security Kirstjen Nielsen, United States Trade Representative Robert Lighthizer, Assistant to the president for Homeland Security and Counterterrorism Tom Bossert, Assistant to the President and Senior Adviser to the president Jared Kushner, Administrator of the United States Agency for International Development Mark Green, and Commissioner of Food and Drugs Scott Gottlieb.
.. White House Press Secretary Sarah Sanders later released a list of additional members that will travel as part of the delegation to Davos: Chief of Staff John Kelly, National Security Adviser H.R. McMaster, and Director of the National Economic Council Gary Cohn as well as other members of the White House staff. They will be traveling with the president.