Thursday, 3 April 2025

Tariffs to the left and tariffs to the right

Right now it's very difficult and confusing to work out exactly what Donald Trump's plan is. The basic goal is relatively simple. To make tariffs on imported goods so high that US businesses and industry will all be forced to buy American to survive which would encourage manufacturers to expand and employ more people to meet the huge new demand. Thus, in Trump's dream plan, the United States of America, already one of the richest countries in the world, will become even wealthier. Never mind other countries, especially the poor ones. But there are a lot ifs and buts here. What if US companies just stick with their foreign customers and pay the extra for the time being in the hope that the tariffs will go away. At the moment, the whole world is up in arms, condemning Trump's tariff war and if there is a mighty backlash against his policy, there could be a massive disruption in trade which will affect American businesses as much as anyone else's. Countries such as China, in fact especially China, as well as the European Union, are going to retaliate with their own tariffs on American goods. It's a vicious circle with no end.

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