President Donald Trump shocked the world last week when he surprisingly announced that the U.S. would impose tariffs on steel and aluminum imports. President Trump’s announcement sparked panic in the financial markets as people worried that we might face a trade war if other nations retaliate by imposing tariffs on imported U.S. goods. Trump seemed unconcerned about the prospect of a trade war. In fact, the president took to Twitter to tell his followers that “trade wars are good and easy to win.” Trump claims that the U.S. loses “many billions of dollars in virtually every country it does business with.”
The president went on to say that ending trade with countries with whom there is a trade deficit would be a “big win.” Trump also claimed that “it’s easy.” The problem is that few would agree with Trump when he says that a trade war is a good thing and easy to win. As reported by Time, the stock market certainly didn’t welcome President Trump’s trade tariff announcement. The Dow Jones Industrial Average dropped more than 500 points. The European Union announced that it would “respond in kind” to any new U.S. trade tariffs.
The Washington Post was forthright in its view. They called Trump’s policy “stupid” and warned that “Trump has loudly and repeatedly signaled his intention to abandon more than 70 years of America’s commitment to free trade.” Trump’s policy on tariffs, they argue, mirrors his decision to pull the U.S. out of the Trans-Pacific Partnership. A decision they claim “was an economic and geopolitical gift to China,” which is now pursuing its own trade partnerships in the Pacific region.
When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!
— Donald J. Trump (@realDonaldTrump) March 2, 2018
Republicans Declare War On Trump Over Tariffs Amid Fears Of Midterm Backlash
It isn’t just Donald Trump’s opponents who are critical of the president’s decision to introduce tariffs on steel and aluminum. As reported by Vox, Trump has “sparked panic” among Republican lawmakers, some of whom are reportedly considering introducing legislation to block him from introducing the proposed tariffs.
House Speaker Paul Ryan, normally a Trump ally, has made it plain that he opposes these tariffs. House Republicans are concerned that tariffs will raise the price of American goods and cause the economy to slow down as we approach the midterm elections. President Trump has, of course, claimed credit for the record levels reached by the stock market during his presidency. Stock market highs, consumer confidence, and reductions in unemployment figures represent rare highlights from a presidency beset by scandal and controversy.
The GOP will doubtless make the economy the backbone of their midterm election campaign. The Republican party will, therefore, be keen to avoid the potential economic damage a trade war might cause. According to Politico, Republicans believe that the good economic news will outweigh Trump’s personal unpopularity.
Republican Senate Finance Chairman, Orrin Hatch, warned that trade tariffs could “undercut the benefits of the pro-growth tax reform we fought to get on the books.” Douglas Holtz-Eakin, president of the American Action Forum, warned that tariffs would undermine Republican plans for the midterm elections because it “goes against our economic message.”
As Politico reported, Republican Senator Lindsey Graham directed a personal message to Trump when he spoke to CBS’s Face The Nation. Senator Graham warned Trump that he was “letting China off the hook and punishing the American consumer and our allies.”