Trump’s Trade Deals Won’t End the Harm Caused by His Tariffs
Trump has reached a trade deal with the European Union, which follows previous deals with the UK, Japan, Vietnam, and the Philippines. Some might view these deals as vindication of Trump’s “Liberation Day” tariffs, and other tariff hikes. But the truth is that these deals leave us worse off than before. In each case, tariff rates under the deals are vastly higher than they were before Trump started his trade war. For example, the new tariff on most EU goods will be 15%, compared to an average rate of 1.47% before Trump’s second term (the EU imposed an average %1.35 rate on US imports). It’s a similar story with Japan (15% vs. 2%), Britain (10% vs. 3.3%), and the others. Moreover, under the Administration’s interpretation of the International Emergency Economic Powers Act (IEEPA), Trump would retain unfettered discretion to raise tariffs further any time he wants for any reason.
As a result, Americans will face much higher prices than before on many goods, and there will be other severe economic damage, as well. All told Trump’s IEEPA tariffs are expected to impose some $1.9 trillion in tax increases on Americans over the next decade, costing the average household some $1000 per year, while also raising prices and greatly diminishing economic growth. In addition,
Article from Reason.com
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