As President Donald Trump last ended Customs so highFinancial markets trembling, the consumer’s trust crashed and his popularity fell.
Only three months later he bets differently this time.
In his new round of tariffs that are announced this week, Trump essentially connects the entire global economy to his instinctive conviction that import taxes enable factory jobs and greater growth in the USA, and not the inflation and weakening, which is predicted by many economists.
On Tuesday, he told his cabinet that former presidents who had not used aggressive tariffs were “stupid”. Always the seller added Trump that it was “Too time -consuming” In order to try to negotiate trade agreements with the rest of the world, it was simply easier to send them letters because he lists the collective bargaining prices for their goods this week.
The letters marked a change compared to his self -proclaimed event on April 2 in the White House, where he had posterboards with the prices displayed, an election that led to one Short market melt And the 90 -day negotiation period with 10% tariffs that end on Wednesday. Instead, Trump decided to send letters with random capitalizations and points and other formatting questions.
“It’s a better way,” said Trump about his letters. “It is a stronger kind. And we send you a letter. You have read the letter. I think it was well made. And mostly it is only a small number in it: you pay 25%, 35%. We have some of 60.”
When Trump said these words, he had to issue a letter with a customs rate of more than 40%, which he had raised in Laos and Myanmar on Monday. He plans to place 25% tariffs on Japan and South Korea, two important trading partners and allies, who were classified as crucial for the containment of China’s economic influence. Guides of the 14 countries that have been negotiated in the next three weeks before the higher prices for imports are calculated.
“I would say that every case in which I treat them better than they have treated us over the years,” said Trump.
The President said on Tuesday evening about Truth Social that he would publish letters to “at least 7 countries” on Wednesday morning, with additional letters out in the afternoon.
Three possible results
His approach contradicted how large trade agreements have been created in the last half century detailed meetings that could sometimes take years to solve complex differences between nations.
There are three possible results in this political and economic bet, each international affairs and Trump’s legacy could change drastically.
Trump could prove most of the economic experts for injustice, and the tariffs could lead to growth as promised. Or he could withdraw to tariffs before her phenomenon “Trump always begins chickens”, also known as Taco. Or he could damage the economy in a way that boomerang against the communities that bring him back to the White House last year, as well as injured countries that are financially disadvantaged by the tariffs could boomerang.
Senator Ron Wyden, D-OR.
“Trump’s Taco negotiation negotiation tactic makes its threats less and less credible and reduces the willingness of our trading partners to meet halfway,” said Wyden. “There is no sign that he approaches permanent trade agreements that would actually help the American employees and companies.”
So far, the stock and bond markets are relatively quiet, and the S&P 500 Stockindex is essentially flat on Tuesday after a decline on Monday. Trump has achieved a legislative victory with his multitrillion dollar income tax reductions. And he confidently raised tariffs on levels that previously shook the global markets and was spoken by the fact that inflation has so far declined instead of accelerating how many economists and democratic rivals had warned.
“Through floating tariffs of up to 40% to 100%, the administration” normalized “the 25% tariff hikes. However, this is still one of the most aggressive and disruptive tariff movements in modern history,” said Wendong Zhang, economist at Cornell University. “This gradual unveiling, paradoxically, risks, which would otherwise be seen as an exceptionally large tariff hiking.”
Others simply see Trump as a source of non -stop chaos with the letters and their somewhat random tariff rates, which show the lack of a real political process in his administration.
“It is really just a confirmation that this guideline is everywhere that you do this by the seat of your pants that there is no real strategy,” said Desmond Lachman, a high -ranking scholarship holder at the American Enterprise Institute, a right -wing think tank.
Questions about how much money will generate tariffs
After Trump’s 90-day collective bargaining phase ended, he had sent letters to 14 countries from Monday, in which taxes are imported to imported goods between 25% and 40%. He said on Tuesday that he would sign an order to put 50% tariffs on copper, and added that pharmaceuticals could eventually be exposed to tariffs of up to 200%. All of this faces its existing 50% tariffs for steel and aluminum, 25% tariffs for cars and its separate import taxes for Canada, Mexico and China.
“The obvious conclusion is that the markets are initially somewhat skeptical that Trump will go through them, or alternatively they believe that compromises are being adhered to,” said Ben May, director of global business research at the Oxford Economics consulting firm. “This is probably the key element.”
May said the tariffs should reduce the growth of the US household income, but do not cause these income to shrink directly.
Trump said his tariffs would close the imbalances with the US trade, although he is unclear why he would address nations like Tunisia that act relatively little with America. According to administrative officials, billions of dollars in customs income in the next decade would help to compensate for the loss of income from the continuation and expansion of his tax cuts for 2017, which were signed in the law on Friday.
So far, the Federal Government has collected 98.2 billion US dollars of tariff income and, according to the cross -party policy, more than twice what it collected last year.
At the cabinet meeting on Tuesday, Finance Minister Scott Bessent said that the tariff revenue could be “well over 300 billion US dollars” by the end of the year. Bessent added that “we do not agree” with the estimate of the Congress budget office that the tariffs would bring in 2.8 trillion US dollars over 10 years “what we consider to be low”.
The governments of Japan, South Korea, Malaysia, Myanmar, Thailand, Cambodia and South Africa, each said that they hope for further negotiations on tariffs with Trump, although it is unclear, as Trump said that it would be too “complicated” to stop all of these meetings.
Instead, Trump posted on social media on Tuesday that the tariffs will be charged as planned from August 1st.
“It has not changed until this date and there will be no change,” said Trump about the social truth. “No extensions are granted.”
