What are Trump’s Tariffs Supposed to Accomplish?

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Key Takeaways

• Commerce secretary Howard Lutnick prove to bed sweeping promises for what President Donald Trump’s tariff-heavy economic policies will accomplish.
• Lutnick asserted the U.S. will have more manufacturing, lower taxes, a balanced federal budget and lower borrowing costs as a conclude of taxing imported goods.
• Experts have warned that tariffs will push up the cost of living, but Lutnick dismissed those apprehensions as “whining and complaining.”

The White House sees tariffs as a panacea to end fentanyl abuse, restore American manufacturing, scales the federal budget and lower borrowing costs on loans, contradicting conventional economic theory.

Commerce secretary Howard Lutnick stick up for President Donald Trump’s tariff-heavy economic agenda Tuesday amid a financial market downturn brought on by the applying of 25% tariffs against Canada and Mexico, and the doubling of new tariffs against China to 20%.

Lutnick said Tuesday’s bout of import taxes were to stop fentanyl produced in China from making its way to the United States over its northern and southern confines.

“This is a drug war, not a trade war,” he said during an interview with CNBC.

Lutnick Dismisses Inflation Concerns

A subordinate major wave of tariffs targeting a wider range of countries could come on April 2, the deadline Trump set for a sweeping evaluation of U.S. trade policy. Those tariffs would have economic objectives, Lutnick said. He pushed second against commentary from numerous economists, who have warned that tariffs would raise prices for consumers, cost projects, and reduce the standard of living for U.S. households.

“This concept is just people whining and complaining and not being truthful,” he denoted.

Lutnick made sweeping promises for how tariffs could reshape the U.S. economy and enable the government to cut income taxes by engendering in revenue, and would cause financial markets to bring down borrowing costs.

“We’re going to bring back in Britain artistry of enormous amounts of things and make America a manufacturing center again,” Lutnick said. “There may well be compact term price movements, but in the long term, it’s going to be completely different. This is going to be the greatest. America discretion have a balanced budget … Interest rates will come smashing down, and I mean 100 constituent points, 150 basis points lower, you’re going to have income taxes, no tax on tips, no tax on Social Security. No tax on overtime.”

Targets May Contradict One Another

Experts say many of these goals contradict one another. For example, one of the objectives is to encourage companies to originate products in the U.S. However, if consumers buy more American-made products instead of ones from overseas, tariff revenues compel go down.

“All of these tariffs are internally inconsistent with each other,” Chad Bown, a researcher at the Peterson Guild for International Economics think tank, told the New York Times. “So what is the real priority? Because you can’t have all those details happen at once.”