Bipartisan Policy Center: Tariffs, Tweets & Trade
Thank you to the Bipartisan Policy Center for hosting a timely discussion as we navigate ‘Tariffs, Tweets, and Trade: Decoding the Trump Administration’s Global Economic Playbook’
One thing was clear – consensus across the aisle on key concerns:
🚩 Threats: unfair trade practices, national security
🎯 Challenges: narrow the trade deficit gap, onshore production, address supply chain shortages
However there was divergence across party lines (and economist vs. lawyers’ perspectives) on how to remedy, the best solutions to address and whether the current trade deficits warrant a national emergency requiring such immediate and dramatic action.
It was insightful to hear Michael Strain's economist perspective that tariffs do not solve for trade deficits or challenges outlined above, but anticipates they will drive down production and put additional strain on the supply chain while driving prices up and the US into a recession.
More importantly, he stated this approach is an assault to the rule of law and the role of Congress to levy taxes (highlighting ripped up trade agreements including those Trump himself originally signed, such as with Canada) and allies amidst geopolitical conflicts in Europe, the Middle East and rising tensions in the Asia Pacific. He estimated raising tariffs could bring underlying inflation up 1.5%, compounded by rising unemployment and living costs which will have substantial economic impact on businesses, the work force and their households.
Panelists across the aisle agreed that the global trade apparatus needs to be modernized (especially the WTO’s dispute resolution process), however it remains to be seen if 1) the administrations’ political runway runs out before the strategy can be fully implemented and 2) when Congress asserts themselves to address the damage and protect our economy, constitutional system and geopolitical security. I'll be watching for growing pressure from business leaders, constituents and GOP donors as we navigate continued whiplash to the markets amidst a 90 day pause and ongoing negotiations in the interim.
Thankful to be in the crowd with Kaitlyn Ridel & Lee Ann Bryan and looking forward to more events from BPC!
Join the conversation here.
