Trump's advisors may argue, but one thing is certain: tariffs will remain high!
U.S. President Trump and some of his advisors claim that trade tariffs can achieve several goals: stimulating the U.S. economy, bringing back manufacturing jobs, increasing tax revenue, and providing leverage for the U.S. in renegotiating security agreements with allies. However, many economists believe these goals are too broad and even contradictory.
Foreign media interviewed several current and former Trump advisors, some of whom have serious disagreements about the economic theories behind the president's strategy. However, most agree on one point: even after Trump's trade negotiations are settled, the U.S. will maintain a high level of tariffs.
Last month, Trump imposed tariffs on imported goods, angering the U.S. trading partners, dragging down the global economy, and causing significant market volatility.
This goes against the post-World War II consensus that free trade brings peace and prosperity. The Republican president claims that other countries have taken advantage of this system, resulting in the loss of American manufacturing jobs and harming the interests of the American working class, many of whom voted for him.
Stephen Miran, chairman of the White House Council of Economic Advisors, stated that Trump is establishing a new trade paradigm for the U.S. and downplaying the impact of financial market volatility and economic data fluctuations, calling it merely a "short-term" effect.
Miran said, "Given the scale and speed of actions the president has taken to ensure American workers are in a fair position against other countries, market volatility is inevitable in the short term."
He stated that there is an optimal tariff rate for the U.S. that maximizes tax revenue while benefiting the economy. Miran said, "I firmly believe there exists such a rate, which is two to three percentage points higher than when this administration took office."
Higher tariffs will bring hundreds of billions of dollars in tax revenue to the federal government each year, which will help implement domestic tax cuts, and Miran stated this will stimulate economic growth.