During the last election, economics was on everyone's minds. Despite the greater economy being healthy with an extraordinary job market not seen since the 1960s, people told pollsters that they were extremely upset about the high cost of living that had been brought on by the disruption of the pandemic and took a couple of years to finally sort out. In poll after poll, Americans said that inflation was the biggest problem facing the nation.
When asked what he planned to do about this, then-candidate Donald Trump's only answers were "tariffs!" and "growth." It was the cure-all for every economic pain that ailed us. Here he is answering a question about what specific legislation he would propose to deal with the high cost of child care. Yes, you guessed it: tariffs.
He promised over and over again that he was going to lower the cost of living and he made it clear that the way he planned to do it was with his beloved tariffs. Well, we're about to find out how that's going to work.
Over the weekend, Trump followed through on his threats to impose 25% tariffs on Mexico and Canada and 10% on China. Imported goods from those nations will be hit with the new penalty beginning Tuesday, ostensibly because of immigration and fentanyl coming over the borders, which is ridiculous. There's no need to discuss Trump's obsession with immigration except to say that Mexico has been cooperating fully with U.S. demands and there simply is not a problem with illegal immigration at the Canadian border except maybe from Americans trying desperately to escape Trump's dystopia.
"We have fought and died alongside you... during your darkest hours ... we were always there standing with you ...grieving with you the American people."
As for fentanyl, Trump claims that 200,000 people have died from fentanyl this year (I assume he really meant last year.) But that's wrong too. Fentanyl overdoses were down 21% last year and in total didn't even come to half that number. Obviously, all overdose deaths are a tragedy but how Trump thinks hitting Mexico and Canada with tariffs is supposed to solve America's drug problem is a mystery. Of course, in his mind they are instruments of magical power so perhaps he can make them work.
Canada responded immediately to the announcement with Prime Minister Justin Trudeau delivering what may be remembered as his finest speech just as he prepares to leave office. It made me, and I would imagine, plenty of other Americans feel a deep sense of shame at what our president is doing to our closest allies:
"We have fought and died alongside you... during your darkest hours ... we were always there standing with you ...grieving with you the American people."
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One might have understood Trump aiming tariffs at China, which is the United States' greatest economic adversary, but then his co-president Elon Musk has important business there so perhaps that wouldn't be prudent. But these demands on Canada and Mexico are incredibly vague and impossible for either country to actually accede to, raising the question of what he's really after with these draconian hits on two of America's closest allies and trading partners.
Economist Paul Krugman wondered the same thing and hypothesized that it's "essentially a dominance display. And the many people pointing out that it’s a terrible idea probably only reinforced his determination to show that he’s in charge and smarter than anyone else." That sounds right, especially when you hear his recent rhetoric around America's relationship with the world.
While signing the Laken Riley Act, Trump rambled on about his recent confrontation with Colombia over the treatment of migrants being returned to their country. He said, "we may have tough talk from others, but it's not going to mean anything. They're going to all take them back and they're going to like it too. They're going to like it." It's like he's speaking in old movie dialog these days.
The other day when he virtually attended the World Economic Forum he said, "One thing we’re going to be demanding is we’re going to — be demanding respect from other nations." In the next breath came this, so we know what he was thinking of in his stream-of-consciousness "weave":
Canada. We have a tremendous deficit with Canada. We’re not going to have that anymore. We can’t do it. It’s — it’s — I don’t know if it’s good for them. As you probably know, I say, “You can always become a state, and if you’re a state, we won’t have a deficit. We won’t have to tariff you, et cetera, et cetera.”
I think everyone has assumed that he is just trolling his younger, more handsome nemesis, Trudeau, with this endless talk about Canada becoming the 51st state – but at this point, you have to wonder. With his recent obsession with territorial expansionism and all the talk of buying (or seizing, if necessary) Greenland and taking back the Panama Canal, it seems that he has truly absorbed the idea that the United States should be growing its territory. His threats to Canada have become even more unhinged in recent days, suggesting that the US plans to choke its economy into subservience:
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It's nonsense, of course. The trade deficit with Canada is minor and it is not a subsidy. He's very confused about all of this. But it seems more and more obvious that he's seriously entertaining fantasies of being some sort of world conqueror. If it's a negotiating tactic, it's a mighty weird one.
We'll soon see if he really means to carry out this inane tariff plan. The markets may react badly which has, in the past, served as a moderating influence on him at least in the short term. (The Wall St. Journal called his plan "the dumbest trade war in history." )
He told reporters that he will be holding a call on Monday with Mexico and Canada, so maybe they can head this off before chaos reigns. If he's been watching Fox News he may have detected a little bit of a problem:
Throughout the campaign, Trump never admitted that his tariffs would cause prices to go up. He evaded it at every turn, saying that energy costs were the only cause of inflation and he was going to "drill, baby, drill." He now admits that it may very well happen but says, "it will be worth the price that must be paid." Paid by average Americans, not him of course. And possibly some of his erstwhile supporters in the business community who really didn't think he'd be dumb enough to kill the golden goose.
This is a person suffering from severe grandiose delusions and they're getting worse. But I'm afraid this is just the tip of the iceberg. His co-president Elon Musk is suffering from the same malady and they've banded together to take America and the rest of the world on their wild, psychotic ride-along. Fasten your seatbelts.
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