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Wednesday, August 21, 2019 6:46:22 PM
AP fact check: Trump’s fog of misinformation on trade
"Trump Is Losing His Trade Wars
"The S Word, the F Word and the Election""
Economy May 11, 2019 3:58 PM EDT
[...]
TRUMP: “We have lost 500 Billion Dollars a year, for many years, on Crazy Trade with China. NO MORE!” — tweet Friday.
THE FACTS: That’s wrong. When sizing up the trade deficit, Trump always ignores trade in services — where the U.S. runs a surplus with China — and speaks only of goods. Even in that context, he misstated the imbalance.
The U.S. trade deficit with China last year was $378.6 billion, not $500 billion.
On goods alone, the deficit was $419.2 billion.
Trump is also misleading when he puts the deficit in that ballpark for many years. It’s true the imbalance has long been lopsided. But the U.S. Trade Representative’s Office notes that exports of goods to China have increased by nearly 73% since 2008 and U.S. exports to China overall are up 527% since 2001.
Nor is the trade gap a “loss” in a pure sense. U.S. consumers and businesses get electronics, furniture, clothing and other goods in return for their money. They are buying things, not losing cash.
TIANJIN, CHINA – 2018/04/05: Soybeans and Banknotes of US Dollar VS RMB, arranged for photography. On April 4th, the US government issued a Customs duty list, which would impose a 25% tariff on the 1333 products exported to China with a total value of 50 billion US Dollar. On the second day, with the approval of the State Council of China, the State Council Tariff committee decided to fight back with a 25% tariff on 14 categories of 106 commodities native from the United States, including soybeans, automobiles and chemicals,. Photo by Zhang Peng/LightRocket via Getty Images
TRUMP: “Tariffs will bring in FAR MORE wealth to our Country than even a phenomenal deal of the traditional kind. Also, much easier & quicker to do. Our Farmers will do better, faster, and starving nations can now be helped. Waivers on some products will be granted, or go to new source!” — tweet Friday.
THE FACTS: In addition to repeating the canard that China pays the tariffs, he’s failing to account for the damage that tariffs can do.
By most private estimates, a trade war leads to slower growth rather than the prosperity that Trump is promising. The president’s tweet also goes beyond past claims that tariffs are simply a negotiating tactic to force better terms with China. Trump appears to be suggesting that a tariff increase would generate revenues that could then be spent on farm products and infrastructure, something that might in theory require support from Congress.
But on their own, tariffs are a clear drag on growth.
Analysts at the consultancy Oxford Economics estimate that implementing and maintaining the latest increase would trim U.S. gross domestic product by 0.3%, or $62 billion, in 2020. This would be equal to a loss of about $490 per household.
Economists at Nomura note that gross domestic product this year could take a hit of as much as 0.4% if Trump expands the taxes to all Chinese imports as business confidence slumped and financial conditions tightened.
https://www.pbs.org/newshour/economy/ap-fact-check-trumps-fog-of-misinformation-on-trade
"Trump Is Losing His Trade Wars
"The S Word, the F Word and the Election""
Economy May 11, 2019 3:58 PM EDT
[...]
TRUMP: “We have lost 500 Billion Dollars a year, for many years, on Crazy Trade with China. NO MORE!” — tweet Friday.
THE FACTS: That’s wrong. When sizing up the trade deficit, Trump always ignores trade in services — where the U.S. runs a surplus with China — and speaks only of goods. Even in that context, he misstated the imbalance.
The U.S. trade deficit with China last year was $378.6 billion, not $500 billion.
On goods alone, the deficit was $419.2 billion.
Trump is also misleading when he puts the deficit in that ballpark for many years. It’s true the imbalance has long been lopsided. But the U.S. Trade Representative’s Office notes that exports of goods to China have increased by nearly 73% since 2008 and U.S. exports to China overall are up 527% since 2001.
Nor is the trade gap a “loss” in a pure sense. U.S. consumers and businesses get electronics, furniture, clothing and other goods in return for their money. They are buying things, not losing cash.
TIANJIN, CHINA – 2018/04/05: Soybeans and Banknotes of US Dollar VS RMB, arranged for photography. On April 4th, the US government issued a Customs duty list, which would impose a 25% tariff on the 1333 products exported to China with a total value of 50 billion US Dollar. On the second day, with the approval of the State Council of China, the State Council Tariff committee decided to fight back with a 25% tariff on 14 categories of 106 commodities native from the United States, including soybeans, automobiles and chemicals,. Photo by Zhang Peng/LightRocket via Getty Images
TRUMP: “Tariffs will bring in FAR MORE wealth to our Country than even a phenomenal deal of the traditional kind. Also, much easier & quicker to do. Our Farmers will do better, faster, and starving nations can now be helped. Waivers on some products will be granted, or go to new source!” — tweet Friday.
THE FACTS: In addition to repeating the canard that China pays the tariffs, he’s failing to account for the damage that tariffs can do.
By most private estimates, a trade war leads to slower growth rather than the prosperity that Trump is promising. The president’s tweet also goes beyond past claims that tariffs are simply a negotiating tactic to force better terms with China. Trump appears to be suggesting that a tariff increase would generate revenues that could then be spent on farm products and infrastructure, something that might in theory require support from Congress.
But on their own, tariffs are a clear drag on growth.
Analysts at the consultancy Oxford Economics estimate that implementing and maintaining the latest increase would trim U.S. gross domestic product by 0.3%, or $62 billion, in 2020. This would be equal to a loss of about $490 per household.
Economists at Nomura note that gross domestic product this year could take a hit of as much as 0.4% if Trump expands the taxes to all Chinese imports as business confidence slumped and financial conditions tightened.
https://www.pbs.org/newshour/economy/ap-fact-check-trumps-fog-of-misinformation-on-trade
It was Plato who said, “He, O men, is the wisest, who like Socrates, knows that his wisdom is in truth worth nothing”
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