President Trump has been peddling tariffs as the nationalist economic elixir to make America something again and ahead of the G7 meeting in Canada Friday, Trump has sparred with longtime allies of the U.S. unilateralism on trade. It’s not just China that’s fallen into the crosshairs of Trump’s economic nationalism (and fought back), historical economic and political allies in Europe, as well as America’s neighbors, Mexico and Canada, have responded by angrily unfurling their very own tariffs on wide array of American goods from steel to orange juice. This wasn’t unexpected. The domino effect of reciprocal protectionism is long-understood to be the problem of just such a mercantilist worldview.
So what’s Trump’s endgame? You would hope the economic benefits would be sufficiently staggering such that there would be enough left over to help repair the bridges the U.S. is torching as it looks to penny pinch its way into an uncertain global future without any clear and coherent vision of a global economic system much different from the one that currently exists. That appears to have been too much to ask. Even the Trump White House’s own analysis of Trump’s tariffs determined they will hurt American economic growth, the New York Times reported Thursday. The internal study conducted by the White House Council of Economic Advisers counters the administration’s sunny projections and aligns more closely with what economists outside the White House have warned.
“In a March survey of an expert panel of academic economists assembled by the University of Chicago’s Booth School of Business, no economist agreed with the statement, ‘Imposing new U.S. tariffs on steel and aluminum will improve Americans’ welfare,’” the New York Times reports. “This week, the World Bank said in its Global Economic Prospects Report that if tariff threats led to trade wars, the consequences could be “devastating.” It pointed to intensifying protectionism around the world as a risk to economic growth.”