Since President Trump entered the office of President, he has focused much of his energy on “putting America First”. Mr. Trump has planned to do this primarily from a economic viewpoint. We’ve seen a rise in GDP over the last quarter 4.1%, he’s reintroduced many jobs that were said to never come back and made one of the largest and most controversial tax cuts in many years. America is prospering, but are we really?
Foreign trade has become a requisate issue for the Trump team, most nearly meaning imposing tariffs. In America, our tariffs are imposed mostly so trade is even between countries as the conversion rates are uneven on currencies. When trade starts to benefit one party over another, the party on the lower end is said to have a trade deficit. Currently america is facing somewhere around a $225 billion dollar deficit with China, meaning we are losing out on a lot of goods in our trade deals.
In order for this too end America should focus on putting our manufacturing back in America, therefore not having to pay high prices that come with trading with China. The other option that Trump has found more appealing comes with the use of tariffs. Mot recently Trump has proposed placing tariffs on nearly all imported Chinese goods if trade practices aren’t changed. These would add up to nearly $200 billion of imported Chinese goods.
Trump has enforced stricter tariffs but this round would hit Americans close because taxes more everyday consumer products. Trump is quoted saying,“Nobody has ever done what I’ve done,” and “The $200 billion we’re talking about could take place very soon, depending what happens with them. To a certain extent, it’s going to be up to China.”
Right now the administration is still deciding what goods specifically will be taxed. There will be six days of hearings to discuss procedures and ideas which will be taken into account before deciding which products to hit. Apple has chimed in to the subject to say a wide range of their products will likely be taxed and therefore prices may be raised.
A big fear is that the US economy may get hit hard. With less growth and competitiveness, prices for everyday goods could rise dramatically. China has said they plan to retaliate against any and all American barriers put in place. Until the hearings have proceeded and plans are made the countries will be at a standstill. We hope that with Trump’s many years of experience in business and economic deals, events like this are normal and the American economy will end up growing as a result. The presidential office isn’t a business boardroom though and Trump could be in for a rude awakening.