Trade risk and reward
US President Donald Trump is a man who judges his successes by anecdote. But his trade war is turning the anecdotes against him.
A poll by George Mason University asked whether people felt Trump’s tariffs against China were a good thing or a bad thing, in light of news that China retaliated with its own tariffs on US goods. Fully 56 per cent of voters thought the situation was bad for US jobs and 73 per cent were worried about the trade war’s impact on them.
The numbers come about a week after we got the first major news about companies such as Harley-Davidson, BMW, General Motors and Volvo responding to tariffs, which have also been applied to Canada, Mexico and the European Union.
It’s too early to say whether Trump’s decision to start trade wars will wind up being successful. Such judgments are for economists in months and years. And a couple or a dozen companies closing plants, while painful for real people in real time, could ostensibly be the cost of creating jobs in other industries or creating a better trade balance, which is Trump’s stated goal. This message actually appears to be coming through — at least for Trump’s base. While Republicans worry about the cost of products by a 56-37 margin, they think the trade war with China will actually be good for US jobs, by a 64-29 margin.
But that immediate pain is also the point, politically. Trump has hailed companies bringing home jobs as a sign of his prowess. He’s now experiencing the other side of that anecdotal coin.
Trump is applying his tariffs not to a struggling economy, but to one that has been on a solid trajectory for years. Moments like now aren’t a great time to rock the boat, politically speaking. Changing things up carries significantly more risk of reversing the progress.