Donald Trump, whose butler took his classes for him at Wharton, reminded the world how little he himself understands economics on Wednesday, with his “Liberation Day” speech rolling out a baseline 10 percent tariff on all imports – with a 20 percent levy on imports from Europe and 34 percent on items from China.
Left off the list: you guessed it, Russia, and its close ally, Belarus.
“Liberation Day,” right.
Vladimir Putin so obviously has something on Donald Trump that it isn’t funny.
“April 2, 2025, will forever be remembered as the day American industry was reborn, the day America’s destiny was reclaimed and the day that we began to make America wealthy again,” said Trump, who, you may remember, filed for bankruptcy six times as a failed businessman before being recast by “Apprentice” producer Mark Burnett as a successful billionaire.
Trump’s butler who took his economics classes for him apparently sold him on the idea that the U.S. economy was at its strongest in the late 19th century, the Gilded Age of the robber barons, and in 1930, when the Smooth-Hawley Tariff Act made the Great Depression what we’ve come to know and love about it since.
How the butler got Trump through Wharton is anybody’s guess.
In the here and now, if you’ve got money in the stock market for your retirement, plan for your stake to take a massive blow; and if you work in, you know, practically any sector with any touch to the global market, I don’t know what to say, other than, prepare to be f—ed.
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Trump is convinced that his tariffs are going to revive American manufacturing, which has been in decline for the past 50 years, with a laser focus on trying to use tariffs to revive the U.S. auto industry.
The “Liberation Day” tariffs set a 25 percent levy on imported passenger vehicles, light trucks, and parts, engines and transmissions from foreign suppliers.
“None of our companies are allowed to go into other countries, and I say that’s friend and foe, and in many cases, the friend is worse than the foe, in terms of trade,” Trump said. “But such horrendous imbalances have devastated our industrial base and put our national security at risk. I don’t blame these other countries at all for this calamity. I blame former presidents and past leaders who weren’t doing their job. They let it happen, and they let it happen to an extent that nobody can even believe.”
Trump seems to think that trends that have developed over a half-century or more can just reverse themselves, that American companies can just snap their fingers and rebuild infrastructure and retrain workers for jobs that will just magically appear from the ether.
He’s left it to his stooges to fan out to the TV media to be Paul Harvey and tell the rest of the story – about how there’s going to be some pain in the meantime, as 50 years of economic globalization is forced to an artificial screeching halt.
Reality check: it’s going to be a lot more than “some pain.”
“The Trump administration’s vision is for the U.S. economy, which is a very large domestic economy, to be more insulated from the global economy. Tariffs are a very effective tool for doing this, but it will hurt some people – it is no mystery that consumers are most immediately the ones that will bear the cost,” said David Bieri, an associate professor in the School of Public and International Affairs at Virginia Tech.
“Consumers,” as in, you and me, who will partner to foot the bill for what will be, in effect, a $600 billion tax hike on U.S. individuals and families in Year 1 alone.
“These tariffs are nothing more than an enormous tax hike on American consumers, who will soon be left footing the bill as they pay more for groceries, electronics, clothes, and cars,” said U.S. Sen. Mark Warner, D-Va. “Tariffs should be targeted wisely, not applied to practically all goods in a way that eliminates jobs, alienates our closest partners, and evaporates the retirement savings of hardworking Americans.”
“This plan is a massive tax hike on Virginians — plain and simple,” said Abigail Spanberger, a former Northern Virginia congresswoman who is now the presumptive Democratic Party nominee for governor in the 2025 cycle.
“Virginia consumers, businesses, and farmers need certainty, not chaos,” Spanberger said, hitting home a point that has roiled the markets.
“The market reaction after hours, I’ve never seen anything like it. This, I think, fair to say, is worse than the worst-case scenario of the tariffs that many in the market expected the president to impose,” CNBC host Jon Fortt said after Trump was done speaking.
“While many were hoping that this would eliminate uncertainty, there’s going to be more uncertainty in the market, and from those watching policy tomorrow, well, if countries push back on how these non-tariff barriers were calculated, will there be wiggle room here? Exactly when do these go into effect? How quickly are companies going to have to adjust their pricing? So many questions,” Fortt said.
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Chris Graham
