Trump, the Economy and the Search for Culprits
Published in Prensa Latina
(Cuba) on 24 August 2019
by Martha Andrés Román (link to original)
President, Donald Trump continues to assert that the American economy is doing very well at the moment, but his recent actions and controversial criticism of China and the Federal Reserve appear to contradict that.
While the media and experts have seen signs that the U.S. could be headed toward a slowdown and some sources are even considering the possibility of a recession, the president has refuted such warnings, repeating that the economy is “the strongest” and “the greatest.”
But the possibility of growth being affected might be nearer than Trump lets on, in large part due to the trade war with China.
This confrontation between the two largest world economies is driven by the U.S. president’s aggressive tariff policy, which causes market instability, imposes new pressures on already affected farmers, beats up companies and threatens consumers.
Beyond this type of impact and warnings about an eventual slowdown, perhaps the main proof that things are not going as well as the president claims can be found in his tweets last Friday.
For one thing, the head of state unleashed a new series of criticisms against China, following the announcement by the Asian country yesterday that it would apply tariffs of up to 10% on U.S. commodities valued at $75 billion a year.
That measure, in response to Trump’s decision to impose 10% levies on Chinese products estimated at an annual $300 billion as of Sept. 1, provoked the anger of the president, who then decided to raise tariffs on the Asian nation even higher.
According to the president of the United States, the tariffs to be imposed starting Sept. 1 will be 15% instead of 10%. Meanwhile, those tariffs currently applied to Chinese products valued at $250 billion will increase from 25% to 30% on Oct. 1.
But the impulsive president went even further and in another tweet, ordered U.S. companies to leave China and start looking for alternatives to trading with China.
While several sources have stated that the president might not have the authority to make such demands on the private sector, his words, according to The Washington Post, “left industries of all levels struggling to comprehend how seriously to take the order and how the White House would enforce it.”*
In addition to attacking China, the president again accused someone much closer of undermining the U.S. economy: Fed Chair Jerome Powell. "My only question is,” Trump tweeted, referring to the aforementioned Fed chair and Chinese President Xi Jinping, “who is our biggest enemy, Jay Powell or Chairman Xi?” The other Trump outburst came after Powell stated at one of the Fed’s annual conferences that uncertainty about global trade was affecting the economy, which was taken as an implicit criticism of Trump’s tariff policy.
Also, although Powell left open the possibility of reducing interest rates again this fall, he did not promise a decrease in response to pressure from Trump on the issue, to which Trump commented, “As usual, the Fed did NOTHING!”
According to The New York Times, the president’s insistent efforts to link Powell and the Fed’s monetary policy to fears about the economy cannot be sustained.
The newspaper claimed that the U.S. economy’s biggest concern at this time is that corporations are sitting on their wallets, partly because of uncertainty about the impact that the campaign promoted by Trump will have on disrupting world trade patterns.
Thus, while the U.S. president speaks of “enemies” and equates a country he perceives as an adversary with the head of his country's Federal Reserve, he actually seems to be looking for someone to blame if the time comes when he is no longer able to support his claim that the economy “is doing really well.”
Democrats and the media would also be included among possible culprits, who, according to Trump, are trying to convince Americans that there is a danger of recession.
In this respect, according to The Washington Post, Trump seeks to blame someone, anyone, for an economy that increasingly worries him.
Nevertheless, despite the many fingers pointing in his direction, the only one whom the president is not inclined to hold responsible for what could happen is himself.
*Editor’s note: This quote, accurately translated, could not be verified.
While the media and experts have seen signs that the U.S. could be headed toward a slowdown and some sources are even considering the possibility of a recession, the president has refuted such warnings, repeating that the economy is “the strongest” and “the greatest.”
But the possibility of growth being affected might be nearer than Trump lets on, in large part due to the trade war with China.
This confrontation between the two largest world economies is driven by the U.S. president’s aggressive tariff policy, which causes market instability, imposes new pressures on already affected farmers, beats up companies and threatens consumers.
Beyond this type of impact and warnings about an eventual slowdown, perhaps the main proof that things are not going as well as the president claims can be found in his tweets last Friday.
For one thing, the head of state unleashed a new series of criticisms against China, following the announcement by the Asian country yesterday that it would apply tariffs of up to 10% on U.S. commodities valued at $75 billion a year.
That measure, in response to Trump’s decision to impose 10% levies on Chinese products estimated at an annual $300 billion as of Sept. 1, provoked the anger of the president, who then decided to raise tariffs on the Asian nation even higher.
According to the president of the United States, the tariffs to be imposed starting Sept. 1 will be 15% instead of 10%. Meanwhile, those tariffs currently applied to Chinese products valued at $250 billion will increase from 25% to 30% on Oct. 1.
But the impulsive president went even further and in another tweet, ordered U.S. companies to leave China and start looking for alternatives to trading with China.
While several sources have stated that the president might not have the authority to make such demands on the private sector, his words, according to The Washington Post, “left industries of all levels struggling to comprehend how seriously to take the order and how the White House would enforce it.”*
In addition to attacking China, the president again accused someone much closer of undermining the U.S. economy: Fed Chair Jerome Powell. "My only question is,” Trump tweeted, referring to the aforementioned Fed chair and Chinese President Xi Jinping, “who is our biggest enemy, Jay Powell or Chairman Xi?” The other Trump outburst came after Powell stated at one of the Fed’s annual conferences that uncertainty about global trade was affecting the economy, which was taken as an implicit criticism of Trump’s tariff policy.
Also, although Powell left open the possibility of reducing interest rates again this fall, he did not promise a decrease in response to pressure from Trump on the issue, to which Trump commented, “As usual, the Fed did NOTHING!”
According to The New York Times, the president’s insistent efforts to link Powell and the Fed’s monetary policy to fears about the economy cannot be sustained.
The newspaper claimed that the U.S. economy’s biggest concern at this time is that corporations are sitting on their wallets, partly because of uncertainty about the impact that the campaign promoted by Trump will have on disrupting world trade patterns.
Thus, while the U.S. president speaks of “enemies” and equates a country he perceives as an adversary with the head of his country's Federal Reserve, he actually seems to be looking for someone to blame if the time comes when he is no longer able to support his claim that the economy “is doing really well.”
Democrats and the media would also be included among possible culprits, who, according to Trump, are trying to convince Americans that there is a danger of recession.
In this respect, according to The Washington Post, Trump seeks to blame someone, anyone, for an economy that increasingly worries him.
Nevertheless, despite the many fingers pointing in his direction, the only one whom the president is not inclined to hold responsible for what could happen is himself.
*Editor’s note: This quote, accurately translated, could not be verified.
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