It is hard to fathom what the Trump administration is trying to accomplish with its approach to trade.
In recent weeks, President Trump launched trade wars with China, Canada, Mexico and the European Union, professing that “tariffs are the greatest” and that trade wars are easy to win. But earlier this week, long before any wins could be tallied, the administration had to scramble together $12 billion to bail out American farmers now being crushed by retaliatory tariffs imposed on American exports, particularly by China.
And of course, it certainly doesn’t end with farmers. Is the Trump team ready to cough up money to help auto manufacturers, the energy industry, distilleries and even newspapers, all of whom are hurt by tariffs?
This is not conservative ideology. Remember when Republicans were the champions of free trade and open markets?
Many still are.
Farmers “want trade, not aid,” Kansas Sen. Pat Roberts said this week.
Added Republican Sen. Bob Corker of Tennessee, “These tariffs are a massive tax increase on American consumers and businesses, and instead of offering welfare to farmers to solve a problem they themselves created, the administration should reverse course and end this incoherent policy.”
On Wednesday, Trump and European Commission President Jean-Claude Juncker agreed to a cease fire of sorts in their escalating trade war, essentially agreeing to hold off on further tariffs while launching talks to work on eliminating tariffs that hamper trade between America and Europe.
But as much as the EU truce was ballyhooed, there wasn’t much substance. …
So why is this happening? Because Trump believes that tariffs on foreign imports will boost American industry and stabilize jobs in agriculture, steel and auto manufacturing.
But in reality, the opposite is occurring. Tariffs hinder markets, weaken sales and limit demand.
Expanded trade rewards productivity and keeps down the cost of raw materials. It allows business to operate efficiently and is the best way to ensure consumer prices aren’t inflated.
Kansas, which exported more than $4.5 billion in agricultural products in 2016, has much at stake. Here’s hoping Wednesday’s truce with the EU was the first step in de-escalating trade wars that are not in the economic interest of Americans from coast to coast.
— The Lawrence-Journal World