Well, while many are calling President Trump’s latest 90 day tariff pause, which did not apply to China, a victory lap indicating a true sign of masterful deal making; after what happened last Wednesday it is anything but a victory. Quietly, and without fanfare, President Trump permanently exempted 20 product categories from the 125% tariff imposed by him on Chinese imports and the 10% baseline tariff on imports from other countries. Included in this list were all computers, laptops, disc drives, automatic data processing equipment, semiconductor devices, memory chips, solar panels, flat panel displays, smart phones, and other consumer electronics. Most made in China.
The U.S. electronics market serviced by these devices is estimated to be worth $510 billion, so how is the lost tariff revenue on these products, with Trump’s latest stroke of a pen, a victory? It is in fact a complete capitulation on the very premise given for imposing the tariffs, namely, increased income for the U.S. economy, and the bringing back of manufacturing jobs to the U. S.
And true to form Fox News gave this latest tariff retreat a rather bizarre spin as they reported, “The bottom line is Donald Trump is back!” Fox Business cast the president as some sort of ingenious chess player, who was a prudent and heroic figure who had saved the world from an economic disaster; the very one he had created by his initial tariff plans. Fox also stated that, “and just when you think the hope is lost, that we’re going to go into a recession, that we’re going to have months, if not years, of down markets, something like this happens!” Again the only reason for the predicted recession and down markets was due to President Trump’s tariff plans.
So, I remain confused as to why this retaliatory tariff plan was initiated in the first place since now one of its biggest sources of income, the foreign made electronics industry tariff has been rescinded, and one of the largest manufacturing industries, again the electronics industry, no longer has any incentive to be brought back to the U.S.
I seriously question this being a plan by some master genius who fully understands how the world economy works. But then again if one looks at some of President Trump’s other business failures, namely, Trump casinos, Trump resorts, Trump’s failed university, his failed airline, failed mortgage company, failed Trump steaks, failed Trump vodka, failed Trump magazine, etc., maybe one can get a better understanding of the present situation. And ironically, Forbes Magazine predicts that Trump would be over $400 billion richer today without all his past failures. Now I understand what happened.