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S&P says effects of Trump's tariff plans 'overwhelmingly negative'.
By Brett Rowland | The Center Square
(The Center Square) – A credit-rating agency reported Thursday that President Donald Trump's proposed tariffs could slow economic growth, increase inflation and push up unemployment.
The S&P Global Ratings economics team, in its first high level estimates, found the potential effects of the tariffs were "overwhelmingly negative," according to the report.
S&P analysts said the tariffs could slow gross domestic product growth, boost unemployment and inflation. It noted that "the effects on the U.S. are smaller than for trading partners." Gross domestic product, or GDP, is a measure of economic output.
Trump proposed a 25% tariff on goods imported from Canada and Mexico, and an additional 10% tariff on goods imported from China. Last-minute negotiations ended with a one-month reprieve for both Mexico and Canada.
S&P noted the uncertainty around Trump's tariff plans creates problems for businesses and U.S. families.
"Uncertainty around the path of U.S. policy and its objectives is high, and confidence bands around our forecasts are correspondingly wide," according to the S&P report. "Moreover, the ongoing deal-making mode of the new administration risks complicating long-term decision making by both firms and households."
On Tuesday, Trump paused his plans for 25% tariffs on goods from Mexico and Canada while starting talks with China on a 10% additional tariff over fentanyl smuggling.
On Saturday, Trump ended decades of duty-free trade between the U.S., Mexico, and Canada with a 25% tariff on imported goods from the two countries, with a lower 10% tariff on Canadian energy resources. Trump initially said he'd keep the tariffs in place until the illegal fentanyl trade subsided. He also added a 10% tariff on imports from China over that country's role in producing the chemicals needed to make fentanyl, a powerful opioid blamed for the majority of U.S. overdose deaths.
Two days after imposing tariffs on U.S. neighbors, Trump relented after reaching temporary deals with Mexico and Canada. Mexican President Claudia Sheinbaum said Mexico will immediately reinforce the border with 10,000 members of the National Guard in a move to stop drug trafficking. Drug trafficking that has been a problem for both the U.S. and Mexico for decades. Canadian Prime Minister Justin Trudeau also promised to reinforce the northern U.S. border in exchange for a pause on tariffs.
China hit back earlier this week with limited tariffs on U.S. imports. The Customs Tariff Commission of the State Council of China put additional tariffs on some U.S. imports while filing a complaint with the World Trade Organization.
A credit-rating agency reported Thursday that President Donald Trump's proposed tariffs could slow economic growth, increase inflation and push up unemployment.
i wonder if it's all just a big show. he threatened tariffs to mexico and canada. when canada said "ok bro fuck you too" all of a sudden they come to an agreement to delay. similar story in Mexico. in a few weeks he'll say "i got the best deal out of the history of deals. Mexico and Canada are gonna pay their fair share" and people will forget about it to focus on the next ludicrous thing he says
i wonder if it's gonna be the same with the deportations. something like 5% of the workforce is illegal. and they are highly concentrated in specific industries. it would wreck havoc on those industries and the economy as a whole. it's really hard to understate. something like every 100 illegals deported causes something like 18 jobs to be lost according to research from Iza based on Obama's radical deportations. (Obama's 1st and 2nd term both deported more than Trump's first term)
i read an analysis by an economist the other day, the deportations alone could reduce lead to the GDP shrinking by something like 3%. keep in mind the housing crisis back in '08 led to a 2.4% decrease in GDP
basically- if Trump actually goes through with his plans we're in for a long period of economic hardship that we haven't seen in half a century. and with it comes lots of radical movements because people will be angry and scared and the right wing is more than happy to throw fuel on the fire
however.. maybe this is all sort of a show. Kind of like his last term with "the Wall". The wall was never meant to be built nor was it meant to accomplish anything. It was just a big theater for his base. An easy to understand symbol to point to. Trump supporters believe based on feeling and not on logic.
of course, that could just be me being optimistic.