The tariff madness of King Donald
By 
I’m afraid that Paul “Too Hot For the New York Tines” Krugman has chosen to write about a topic multiple times. (Time for Patrick Healy to put together another “why is Donald Trump so overwhelmingly popular?” panel!” And it cannot be pointed out often enough that the correct baseline for evaluating the Trump Taxes is “when Trump took office,” not “the even more insane shit he did last week”:
Anyone sounding the all-clear on tariffs, or Trump economic policy in general, should be kept away from sharp objects and banned from operating heavy machinery. We’re in a hardly better place than we were before Donald Trump announced a tariff pause (in a Truth Social post, of course.) In fact, we may be in a worse place.
Let me make four points about Trump’s post-pause tariff regime.
1. Even the post-pause tariff rates represent a huge protectionist shock
2. Destructive uncertainty about future policy has increased
3. We’re still at risk of a major financial crisis
4. The world now knows that Trump is weak as well as erratic
Still a huge protectionist shock
Yesterday Trump announced that he wasn’t going to impose all those tariffs he announced last week after all. Instead, he’s putting a 10 percent tariff on everyone, and 125 percent on China.
Question of the day: Does the 10 percent rate still apply to the penguins of the Heard and McDonald islands?
Anyway, this new announcement still sets tariffs at a much higher level than they were before Trump took office, indeed higher than he suggested during the campaign. For example, during the campaign researchers at the Peterson Institute for International Economics constructed a model assuming Trump implemented a 10 percent tariffs across the board and 60 percent on China. The researchers concluded that this regime would impose a nasty shock on the US economy. Now we are facing a tariffs of more than twice that level against China as well as 10 percent on all other countries.
This is still a large, extremely regressive, and extremely disruptive tax increase, and since Trump is also reminding people vividly that he will change the rates at any time on a whim, they won’t produce the More Manly Jobs benefits that they probably wouldn’t anyway. The Art of the Deal — by Donald Trump’s ghostwriter, foreward by Nico Harrison.