The Bottom Line
Will Trump back down from his threats of tariffs and trade wars? | The Bottom Line
Feb 10, 2025
Joseph Gagnon, a senior fellow at the Peterson Institute for International Economics and former U.S. Federal Reserve official, dives into the complexities of Trump's trade policies. He highlights the unrealistic expectation that tariffs can replace taxes and critiques their impact on consumers. Gagnon discusses the bloated nature of U.S. government and the potential consequences of drastic cuts. He raises concerns about the reliance on borrowing and the risks of insular trade approaches, as well as the implications for economic growth and national debt.
23:57
Episode guests
AI Summary
AI Chapters
Episode notes
Podcast summary created with Snipd AI
Quick takeaways
- The effectiveness of tariffs as a revenue source is questioned, with most costs falling on American consumers rather than foreign exporters.
- Significant cuts to government agencies raise concerns about economic transparency and the quality of data essential for informed policy-making.
Deep dives
Tariffs and Revenue Generation Challenges
Tariffs implemented by the U.S. government, particularly under President Trump's administration, are seen as a way to generate revenue from foreign countries. However, economic analyses indicate that most of the burden falls on American consumers rather than the targeted nations like China. For instance, studies have shown that the cost increases due to tariffs are primarily absorbed by U.S. importers who face rising prices rather than by the exporting countries. This raises questions about the effectiveness and long-term sustainability of tariffs as a revenue source compared to traditional methods like income tax.
Remember Everything You Learn from Podcasts
Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.
