May 5, 2019

THE rIGHT IS THE lEFT:

On Trump's Trade Policy, A Democratic Echo (Steve Chapman, May 5, 2019, National Memo)

If you want to get an unanimous verdict from any gathering of economists, just ask them about Donald Trump's trade policy. If it were a movie, its Rotten Tomatoes score would be zero. One expert analysis after another has torched it.

A report from the Becker Friedman Institute at the University of Chicago found his tariffs on washing machines cost consumers $1.5 billion, or more than $815,000 per U.S. job saved. A study for the National Bureau of Economic Research concluded that Trump's trade war has reduced Americans' real incomes by $1.4 billion per month.

The Tax Foundation says the new tariffs amount to a tax increase of $42 billion on Americans. A team of economists from the University of Chicago, Northwestern and Stanford estimate that tariffs and trade squabbles cut investment in U.S. manufacturing by 4.2 percent last year.

NBER notes that Trump's tariff hikes "are unprecedented in the post-World War II era in terms of breadth, magnitude and the sizes of the countries involved." They haven't worked in the most basic sense. The overall trade deficit in goods, which he promised to eliminate, hit a record high last year, and the imbalance with China.

To the surprise of no economist, his policy of blocking trade, and threatening to do so, turns out to be bad for consumers, producers and the economy. So how are Democrats running for president handling the issue? By offering their own version of protectionism.

On Monday, Bernie Sanders attacked Joe Biden by saying, "I helped lead the fight against NAFTA; he voted for NAFTA." Like Sanders, Elizabeth Warren opposed the Trans-Pacific Partnership, a mammoth free trade deal among the United States and 11 Pacific Rim nations. Both also oppose the administration's modest revision of NAFTA, the United States-Mexico-Canada Agreement.

The positions of Sanders and Warren, write Gary Clyde Hufbauer and Euijin Jung of the Peterson Institute for International Economics, "do not differ greatly from President Trump." 

Posted by at May 5, 2019 7:36 PM

  

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