Americans were hit with some sad news on a Sunday
Americans may soon feel the pinch in their daily expenses as economist predict the effect of tariffs on imported goods.
The spark for this worry plus doubt came from the president when he announced a new round of import taxes. He said the taxes would be placed on goods coming into the country from Canada, Mexico, and China.
The president who used aggressive stances and a firm tone to make a statement to US trading partners the president played no favorites and no country was safe from these tariffs.
There was strife and doubt on both sides. Talks about reciprocation and strained relationships were on the table.
Off the bat, Trump's tariffs began stirring up a hornet's nest.
Trump on Sunday followed up this situation with new warnings
Trump threw out the news that the plan to go after the EU and the UK with import taxes are soon on the horizon.
Trump did not hold back when talk about Canada
Canada was on the president’s mind. When asked about Canada’s whopping trade deficit with the US president suggested that Canada must become a US state.
He said that if Canada - a valued ally, did not cooperate- they will need to figure something else out to stabilize their economy.
Canadians would therefore be subsidized by the US and have to worry about the price of keeping their energy flowing.
The American president left out that the American market is the top export market for 36 states.
Mexico reacted as well. its president, Claudia Sheinbaum, did not hold back either. She targeted drugs and addiction.
China was not going to be left out.
The president announced the first round of tariffs would also go into action on Tuesday. China, not happy with the outcome, plans to bring forward a dispute with the World Trade Organization.
Trump was expecting the pain to last for a short period of time.
Economists at Yale and Goldman Sachs however stated that this wouldn’t allow average Americans to breathe or even shop at full capacity for at least a decade.
An average earnings of a household of 1, 245 USD. If the tariffs stay in effect they could lose their income for a decade, additionally 1. 4 trillion dollars in economic damages.
Yep, it could be bad.
Canada’s trade with the US is mostly about oil.
Canada, The US is the largest consumer of Canadian oil. More than 25% of the oil that America uses comes from its neighbor to the north.
The effects of tariffs are not left in the country.
More than 75% of Canadian exports head to US and in response Trump asked Canada to take up his offer of becoming the 51st US state.
This brings up a few looming questions.
Will the tariffs help Americans considering the tariffs do not account for inflation?
The president has gone back and forth and still has not given a concrete answer on tariffs.
The president made a vow in 2020 election that America under his leadership would experience lowered inflation rates but the opposite may actually happen.
The tariffs could cause pain into the USA economy for many years
He raised the question on multiple occasions, but it seems he did not take time to think.
It could be a setback for the US economy and his popularity within the country.
The president did not rule out any possibility that he will make his plan of taxing goods from additional countries
He said that it would be soon but that he would not go into the details
Economists like Larry Summers who advised the Clinton administration, have stated that this tariff situation sounds more like a self-inflicted wound.
He suggests that Trump may be creating more problems. Larry states that this will make the play ground into a place where bullies thrive, and that it is the same with international relations.
This is similar to a bully who has no strong strategy.
Larry suggests that this plan would result in everyone losing with the exception of China.
It is a fact that America needs to make agreements with other economic giants.
Trump has certainly made a statement.
The tough talk and strong stance would let the country budge into the wrong direction, Larry suggest.
He also said that this would bring more power into Xi Jinping's hands as leader of China.
He says this move by Trump will do more harm than good.
The tariffs could affect many businesses and American households.
This could make it hard to believe in the president.
This is not the way to go.
The uncertainty on all sides could cause Americans a significant amount of panic and confusion.
Trade relations between the USA, Canada, and Mexico have always been the symbol of a decade-old alliance.
Whatever the outcome will be, this way of thinking could mean that the world economy will take a hit.
