Trump’s Love for Tariffs Began in Japan’s ’80s Boom – The New York Times

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Those tensions have not entirely subsided. On Sunday, Mr. Cohn’s successor, Larry Kudlow, irked Mr. Trump when he told a television interviewer that American consumers would pay some of the costs of tariffs.

Mr. DiMicco, the campaign trade adviser, said Mr. Trump was living up to his promises and becoming the first American president to say “enough’s enough” to China. Mr. Trump’s message to Beijing, he said, was that “there’s only one way for us to obviously get your attention because you haven’t lived up to any agreement you’ve made with the global trading community, and that’s to hit you between the eyes with tariffs.”

Mr. Trump relies on his trade adviser, Peter Navarro, to provide the economic rationale for his devotion to tariffs. When a delegation of Republican senators warned Mr. Trump in a recent White House meeting about their cost to consumers, the president turned to Mr. Navarro, who showed the senators a slide presentation that documented how the tariffs had helped lift first-quarter economic growth to 3.2 percent.

A former professor at the University of California, Irvine, Mr. Navarro has long argued, in books and speeches, that tariffs — far from being a burden on consumers and a drag on growth — can fuel growth and productivity. Those views place him outside the mainstream of his profession. But he argues that the standard economic scholarship about tariffs does not take into account market distortions between trading partners.

In the case of China, Mr. Navarro has said, those distortions include huge Chinese subsidies of exports, the forced transfer of technology from American firms that want to do business in China and the theft of American intellectual property. He argues that tariffs, which might otherwise raise the prices of Chinese goods, serve merely to level the playing field. They also encourage production in the United States.

Arthur Laffer, the conservative economist who has advised Mr. Trump, said he has told the president what he tells everyone about trade policy: “When you look at tariffs, they are very, very bad for the economy.” But he believes Mr. Trump is using tariffs to pressure other countries to open their markets more freely.

“I have no reason to second-guess the president on negotiation strategy,” Mr. Laffer said.

Increasingly, though, Mr. Trump appears to view tariffs as not just a negotiating ploy, but an end in themselves. He declared last week on Twitter that Chinese leaders seemed to think they could get a better trade deal if they waited for a new president to be elected.

“Would be wise for them to act now,” Mr. Trump wrote, “but love collecting BIG TARIFFS!”

Source Article from https://www.nytimes.com/2019/05/15/us/politics/trump-tariffs-japan-china.html

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