Trump’s Tax on America

It would seem that for the Republican Party, an incompetent, erratic kleptocracy might just be the best form of government.

Or at least it was until March 1, 2018, the day Trump signaled his intention to impose across-the-board import tariffs of 25% on steel and 10% on aluminum. That decision, notes Pat Roberts, a Republican senator from Kansas, “is not going to go down well in farm country.”

..  His worry now is that Trump will pursue “a trade policy that will basically result in all the benefits of the tax reform being taken away by higher manufacturing costs being passed on to consumers.”

.. In the end, American consumers will pay for Trump’s tariffs. Such broad protectionist measures will affect every sector of US manufacturing in one way or another, and manufacturers certainly will not eat the full costs of higher-priced steel and aluminum inputs.

.. So, Trump has essentially proposed a new tax on US consumers and export industries, the costs of which will be borne largely by his own supporters in the American heartland and Rust Belt.

.. It turns out that Trump’s decision was taken against the advice – indeed, over the objections – of not just his

  • chief economic adviser, Gary Cohn, but also his
  • national security adviser, General H.R. McMaster, his
  • treasury secretary, Steven Mnuchin, and his
  • defense secretary, James Mattis.

On the other hand, Secretary of Commerce Wilbur Ross apparently favors the tariffs. But it is not at all clear why. The Department of Commerce itself surely recognizes that more Americans benefit from lower steel and aluminum prices than from higher prices.

Another supporter of the tariffs is Peter Navarro, who was recently promoted to Director of Trade and Manufacturing Policy and Director of the White House National Trade Council. That comes as no surprise. Navarro has written a number of alarmist books about America’s trade relationship with China, including one titled Death by China. Nevertheless, Navarro has not yet been able to explain how creating a larger domestic steel industry through tariffs will yield a net benefit for the US economy.

A final key supporter of the tariffs is US Trade Representative Robert Lighthizer, who formerly worked as a lawyer for the steel industry. As with Ross, it is not entirely clear what Lighthizer is thinking. He has to know that Trump’s tariffs will have little to no chance of boosting the US steel and aluminum industries without also imposing substantial costs on the economy. Doesn’t he realize that his own reputation will ultimately depend on whether the administration has a successful trade policy or an obviously stupid one?

Trump Administration Tells Lawmakers China Trade Actions Are Needed

Mr. Lighthizer, in his formal statement, wrote that actions against China were necessary because the World Trade Organization “has proven to be wholly inadequate to deal with China’s version of a state-dominated economy that rejects market principles.” He didn’t repeat that sentence during his oral remarks.

.. “Our view is we have a very serious problem losing our intellectual property, which is the single biggest advantage of the U.S. economy,” Mr. Lighthizer said. “We are losing that to China in ways that aren’t reflective of the underlying economics.”

Select the Worst Trump Minion

Just this week we had a top aide with multiple domestic abuse allegations, plus a chief of staff who never seemed to bother to pursue the matter. And a communications director — third one in a little over a year — who helped write the statement defending said aide, whom she happened to also be dating.

.. Tenure is irrelevant. Kirstjen Nielsen has only been secretary of homeland security for a couple of months, but we already know her as the woman who tried to support her boss by claiming she wasn’t sure whether Norway was a predominately white country.

.. Secretary of Health and Human Services Alex Azar .. Azar’s mission is supposed to be bringing down prescription prices, and his main qualification is having run the American division of a drug company during the five years when the price of its insulin rose from $122 to $274 a vial.

.. Secretary of Education Betsy DeVos ..  “The bureaucracy is much more formidable and difficult than I had anticipated,” she complained.

.. Scott Pruitt, head of the Environmental Protection Agency

.. “Do we really know what the ideal surface temperature should be in the year 2100? … That’s fairly arrogant for us to think that we know exactly what it should be in 2100.”

.. Attorney General Jeff Sessions is busy pushing the federal death penalty and trying to prosecute the marijuana industry in states where grass is legal.

..  U.S. Trade Representative Robert Lighthizer is trying to dismember the World Trade Organization. Smaller minds are fascinated by reports that Lighthizer has a life-size portrait of himself hanging on the wall at home.

.. Secretary of Commerce Wilbur Ross is in charge of the upcoming census, which is underfunded, and rumors are that the chief candidate for deputy director is a highly partisan Texas professor whose book on reapportionment is subtitled “Why Competitive Elections Are Bad for America.”

..Secretary of the Treasury Steve Mnuchin .. The new Trump nominee to lead the I.R.S. is a tax lawyer who specializes in defending wealthy clients against — yes! — the I.R.S. To cheer things up, we can go back to recalling the time Mnuchin posed with his wife, dressed in black opera gloves and a come-hither hairdo, admiring his signature on bills at the Bureau of Engraving and Printing.

Secretary of the Interior Ryan Zinke is well known for his enthusiasm for fossil fuel drilling. But even some of his fans were a little perplexed when he announced a policy for expanding offshore oil and gas drilling, and then abruptly added that there would be an exception for … Florida. Think it was all about Mar-a-Lago?

.. taxpayers paid $6,000 to helicopter Zinke to a critical appointment going horseback riding with Mike Pence.

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.