Shortly before taking office, Donald Trump told the American public that winning trade wars was easy. Soon after, he engaged in a trade battle with China over a number of products. For years the nations took turns slapping retaliatory tariffs on each other’s products.
According to the President, this trade war could soon be coming to an end. A recent study by the Federal Reserve found that the trade battle resulted in both job losses and higher prices for everyday Americans.
Soon after Trump released details on his agreement with China, the deal was ripped by Democrats. Connecticut senator Chris Murphy wrote on Twitter, “Here’s some back of the napkin math on China deal: China agrees to buy $50B of ag products next year, increase of $29B from pre-tariff trade. Tariffs cost U.S. farmers $11B. Then taxpayers put up $28B in emergency ag payouts. So…we lost/spent $39B. Gained $29B. Nice work!”
Here's some back of the napkin math on China deal:
China agrees to buy $50B of ag products next year, increase of $29B from pre-tariff trade.
Tariffs cost U.S. farmers $11B. Then taxpayers put up $28B in emergency ag payouts.
So…we lost/spent $39B. Gained $29B.
— Chris Murphy (@ChrisMurphyCT) December 13, 2019
The Federal Reserve seemingly agrees with Murphy. The organization said in their study, “We find that the 2018 tariffs are associated with relative reductions in manufacturing employment and relative increases in producer prices.”
The authors of the study, economists Aaron Flaaen and Justin Pierce also took issue with the President’s strategy. They continued, “We find the impact from the traditional import protection channel is completely offset in the short-run by reduced competitiveness from retaliation and higher costs in downstream industries.”
The White House has yet to respond to the criticism laid out in the Federal Reserve’s study.
What's Your Reaction?
Todd Neikirk is a New Jersey-based politics and technology writer. His work has been featured in psfk.com, foxsports.com, and PoliticusUSA. An avid pet lover, he has been known to contribute to Pet Lifestyles Magazine. He enjoys sports, politics, technology, and spending time at the shore with his family.