During his first term as President, Trump raised tariffs, strategically. Yet during his term of office, with tariffs going up, the average inflation rate for his four years in the White House was 1.6%–a very good number. So, if President Trump is going to use tariffs as a stick, he knows how to use it, to benefit Americans.
I am not concerned about higher prices due to tariffs. I am worried about illegal aliens, China and other nation hacking our electric grid, Internet and more. I am worried about Iran efforts to promote terrorism and Venezuela sending gang members here.
In six weeks, we will see a new American—one that stands up for American rights and freedom. A breathe of fresh air.
TRUMP’S GIGANTIC MISTAKE
By Richard Colman, Exclusive to the California Political News and Views, 12/13/24 www.capoliticalnewsandviews.com
President-elect Donald Trump has made a colossal mistake by proposing on Nov. 25, 2024, a 25% tariff on goods coming into the United Stated from Canada and Mexico.
According to The Economist (Nov. 30, 2024), “The threat of tariffs will do harm, whether or not the Trump administration imposes them.”
Tariffs are simply a tax.
No one knows if Trump is serious about imposing his proposed tariffs. The possibility exists that Trump’s proposed tariffs are simply an effort to gain non-tariff concessions –- from Canada and Mexico -– on non-tariff issues, such as control over illegal immigration and the importation of illegal drugs.
From history, Trump should have learned that tariffs are inflationary and kill jobs. (When one considers jobs affected by tariffs, think of truck drivers and port workers.)
In 1930, the federal government imposed the Smoot-Hawley tariffs, which were signed into law by President Herbert Hoover, a Republican.
According to an internet report, the Smoot-Hawley tariff came into law on June 17, 1930. The internet reported (Nov. 22, 2024,), “The punitive tariffs raised duties to the point that countries could not sell goods in the United States. This prompted retaliatory tariffs, making imports costly for everyone and leading to bank failures in those countries that enacted such tariffs.”
According to another internet report, “ . . . the [Smoot-Hawley] law raised tariffs by 20%, prompting other countries to impose high tariffs on U.S. exports . . .” The tariffs led U.S. exports to fall from $7 billion in 1929 to $2.5 billion in 1932.” That decline was 64%.
Instead of proposing higher tariffs on Canada and Mexico, Trump should have proposed reducing or eliminating tariffs on these two countries. Commerce among Canada, Mexico, and the U.S. is heavily intertwined and tariffs only kill economic growth and, eventually, ruin prosperity.
Trump should know that one of the world’s greatest free-trade areas exists among America’s 50 states. For example, if one were to ship a box of books from Arizona to Ohio, there would be no tariffs as the box moved between the two states.
Another example involves the Mississippi River, which traverses 10 American states. If an item had a price of $100 in Minnesota and if each state along the 10-state trade route added a 10% tariff, the item would have a price of $250 by the time the item reached Louisiana. (These prices cited do not include transportation costs.)
According to The Economist (Dec. 7, 2024), “General Motors . . . imports over half of the pickup trucks it sells in America from Mexico and Canada.” A tariff on imports from Mexico and Canada could be expected to drive up prices to American buyers.
When Trump announced his Canada-Mexico tariff plan, the share price of General Motors stock fell by
9%. With Stellantis (formerly Chrysler), the share price dropped by 5%. These figures come from The Economist (Nov. 30, 2024.)
Trump’s proposed tariffs contradict the views of President Ronald Reagan, who, like Trump, belonged to the Republican Party. In 1988, Reagan, as president, said: “ . . . we should take a moment to recognize that one of the key factors behind our nation’s great prosperity is the open trade policy that allows the American people to freely exchange and services with free people around the world.”
On Nov. 29, 2024, The Wall Street Journal’s print edition reported that Canada and Mexico “ . . . collectively account for 63% of U.S. petroleum imports.” Do Americans want to pay more for gasoline?
In another area, a tariff on Mexican imports could raise the price of avocados. On Dec. 11, 2024, The New York Times, in a news article, asked, “Are you ready for guacamole to become a luxury item?” Guacamole is made from avocados. Ninety percent of avocados consumed in America come from Mexico.
Trump is not following traditional American policy on free trade.
Already food and other products cost too much. There is no need for Trump to add to the high prices Americans already pay for just about everything.
