Television news was kind to the Blonde Bomber last weekend for his skill at practicing self-deprecating wit. Lyin’ Donald was at his cunning best captivating the cynical Gridiron crowd with Trumpian witticism. For an evening, the progenitor of blind-side economics was given a human face.
Even those who publicly despise the vainglorious madman basked in the glow of a presidential event for journalistic luminaries, bringing to mind the question of whether the news industry is merely another kind of fawning theater.
Folks not still mesmerized the next morning probably were probably wondering, “Why a trade war?”
No answers from the prestigious Wharton School of Business and Finance at the University of Pennsylvania, where Trump attended as an undergraduate. The late economics Professor Thomas T. Kelley claimed that “Donald Trump was the dumbest goddamn student I ever had.”
So once again, after a thoughtless tweet and a badly worded, unsupportable explanation, Lyin’ Donald has launched the world into another tizzy.
So, what is a Trumpian trade war?
The object of any trade war is for Country A — in this case Trumplandia — to gain economic advantage over other countries, which forces the losers to agree to a trade balance or accept a trade disadvantage. Nations not looking for a fight usually agree to rebalance their trade practices so everyone is happy.
Inside Trumplandia Headquarters, however, the world’s greatest deal maker wants to go beyond settling perceived disputes. Gen. Shit-For-Brains wants to punish the alleged transgressors with an economic brouhaha.
The easiest and most provocative way is for Trump to impose arbitrary tariffs — essentially excise taxes — on foreign imports in order to provide U.S. manufacturers the advantage of offering similar products at lower cost. So-called excise taxes are paid when purchases are made on a specific good, such as steel. The tax is usually included in the retail price of the finished product. Unfortunately, tariffs are a sword that cuts both ways.
Trump’s reason for making such a draconian threat is to gain redress from all the economic opponents he perceives to be exploiting the United States, which apparently includes everybody but Russia and China. Ironically, his disabused “trickle-down theory” argues for income and capital gains tax breaks, or other financial benefits, to large businesses, investors and entrepreneurs to stimulate economic growth. More taxes of any sort are never part of his equation.
Raising tariffs that impact the same beneficiaries’ fixed costs flies in the face of Trump’s own economic program because tariffs raise the costs of goods and services that will ultimately be passed down to American consumers, already getting screwed by Trumplandian tax reform. Demand falls and prices rise, a cyclical condition that feeds on itself.
Lyin’ Donald says his ulterior motive is concern for American workers, as detailed in his unpublished classic, “American Workers I Have Dined With.”
Trump’s growing legion of detractors say his trade war is really a presidential hissy fit because his administration is self destructing. It may be true, given almost everyone who works for him is fleeing the White House faster than disturbed fruit flies. Trump, meanwhile, says he likes maniacal change, and that chaos and trade wars are good.
Trump’s agenda is a perfect platform for economists who remain unsatisfied upon reaching and sustaining economic equilibrium. They want it all. The economists who strive for economic empires advocate a kind of trade and industry imperialism that has already resulted in five centuries of mercantile warfare.
The concept has been practiced by all the European powers, the Turks, Americans, Japanese, Russians and Chinese interests, with mixed results. Most of the old empires are gone, replaced by a bag of pretentious democratic, autocratic and theocratic governments that sell their countries to the same former imperialists like used cars. What has slowly disappeared from this geopolitical miasma, so far under Trump, is economic conflict that ultimately erupts into world war.
It has been 79 years since Germany surged across Europe seeking lebensraum — living space — to supplement its meager economy by force. It’s been 77 years since the Japanese tried to conquer Asia and implement its self-serving “Co-Prosperity Sphere.” German and Japanese aggression didn’t end until both countries were leveled by the rest of the world. There is a lesson there.
If Lyin’ Donald’s latest Twitter tornado stirs up the dust the way he seems to hope it will, that terrible turnpike could reopen. Few times since the British appeased Hitler and President Franklin D. Roosevelt cut off exports of steel and oil to Japan has the world taken such a deep breath. In one asinine maneuver — reportedly during a fit of pique — Lyin’ Donald has managed to threaten a trade war that could devastate not only the U.S. economy, but that of most of the world.
Somebody will ultimately be the winner, but with Captain Bone Spurs at the helm, the Good Ship USA will at best take a serious hit, and if the world unites to defeat it, the stout old ship may very well sink.