ABC News Daily
Will Trump’s China tariffs trash our economy?
Nov 12, 2024
Dr. Susan Stone, the Credit Union SA Chair of Economics, discusses the potential fallout of Trump's return to the White House and the threat of a new trade war with China. She highlights the risks to Australia's economy, including rising inflation and interest rates. Drawing on historical trade conflicts, she explains how tariffs can lead to job losses and increased costs for consumers. Stone offers insights into the intricate global trade dynamics and their ramifications for both the U.S. and Australia, emphasizing the need for cautious optimism.
14:45
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Quick takeaways
- Trump's proposed tariffs could escalate inflation in the U.S., leading to higher consumer prices and impacting Australia's economy significantly.
- Historical patterns suggest that while Trump's policies may initially boost spending, long-term economic sustainability could be jeopardized, affecting job creation and economic performance.
Deep dives
Potential Trade Wars and Their Impact
The possibility of a trade war looms with Donald Trump's return to the White House, particularly affecting Australia due to its significant trade relationships with China and other nations. Historical evidence suggests that tariffs typically escalate costs for consumers and businesses, as seen in the past trade war with China, which resulted in job losses in the U.S. The speaker emphasizes that tariffs are essentially an added tax on imported goods that can lead to reduced imports and, ultimately, higher prices for consumers. A particular concern for Australia is its heavy reliance on higher technology exports to the U.S., which could be jeopardized by Trump's proposed blanket tariffs.
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