The Wright Show Untangling Trump’s Tariff Logic (Robert Wright & Samuel Hammond)
Apr 15, 2025
Samuel Hammond, Chief Economist at the Foundation for American Innovation, unpacks the complex tariff strategies of Trump's administration. He discusses the potential economic ripple effects and how tariffs are reshaping global trade dynamics. Hammond challenges the perception of China's economic fragility, emphasizing its capitalist traits and political stability. The conversation also touches on the role of AI in U.S.-China relations and the need for technological supremacy to maintain global power. Tune in for insights on the interplay of tariffs and American imperialism.
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Tariffs Aim to Reshape Dollar Role
- Trump administration's tariff policy may aim to weaken the US dollar while maintaining its central global reserve role.
- They want countries with trade surpluses to buy more US debt, balancing currency strength and trade deficits.
Tariff Logic Lacks Coherence
- Reciprocal tariffs were set proportional to trade deficits, a rationale economists largely reject.
- Trump's tariff shifts often lack coherent economic theory and seem driven by personal reactions and instincts.
Capital Controls Signal Currency Panic
- The worst-case scenario involves escalating trade tensions causing capital flight and the imposition of capital controls.
- Capital control measures signal severe financial panic, resembling a bank run on the US dollar.