Fighting back with facts, the World Bank (WB) is warning that as a consequence of the US trade wars with friends and foes, global business confidence has gone down the drain, slowdown in global trade has deepened, and investment in emerging and developing economies has dropped. Because of this worrisome and devastating trend, the International Monetary Fund (IMF) Managing Director Christine Lagarde is warning that the unnecessary trade war and escalating tariff threats will decelerate global growth even further.
This terrible business outlook is only bolstered by the fact that much of the US and global economic problems today can be traced back to Trump’s political adventures and protectionist policies. The fall in stock markets is traced to his trade tussle with China. The recent investment loss in the manufacturing confidence in the US has come as a direct consequence of the threat to slap tariffs on European goods. The new reports and warnings issued by the World Bank and the IMF are also tied to the US role in destabilizing the global economy with its extended preoccupation with trade wars and tariffs, even against European allies.
To substantiate, Trump’s threat to impose tariffs on European goods has cut investments in the US market and increased manufacturing costs. According to the Center for Automotive Research (CAR), a 5 percent to 25 percent tariff rate on all imports from Europe would mean a price increase of at least 5,400 dollars on an average new vehicle built in the US.
The Atlanta Federal Reserve (AFR) also says the recent selloff in stocks and sharp drop in interest rates reflect investor worry over a slowing global economy. In its latest forecast, the AFR names the US-China trade dispute and other protectionist measures that have raised costs for everybody and reduced economic activity.
The situation is so desperate that many Congressional Republicans are also unwilling to swallow Trump’s trade-war miscalculations. Media reports suggest that, “White House Deputy Counsel Pat Philbin and Assistant Attorney General Steve Engel faced brutal push-back from the GOP, according to multiple senators, with some threatening that Trump could actually face a veto-proof majority to overturn the tariffs.”
This kind of opposition to Trump’s sanctions, tariffs and trade-war gambit should stun no one. It shows the Trump officials have been lying about their true intentions. The vast majority of their geopolitical intentions remains completely in the shadows and is never subjected to meaningful examination - which only increases the chances of global market uncertainties with catastrophic consequences.
Of course, these are only some of the overwhelming facts and developments that have managed to make it into the news and onto the record. After considering the trail of global economic consequences that follow the American flag wherever it goes, it is safe to say the US is exceptional in many things; responsibility and fairness in global trade is not among them.
The threat of new sanctions on Iran and tariffs is also being consistently propped up by the concept of American exceptionalism. So, it’s also safe to conclude that this makes the US the biggest threat to global economic growth and energy stability.
Behind the clouds, however, Washington’s sanctions and trade-war goals are wishes, being fought for the worst possible reasons. The gambit is just a wish, a pie-in-the-sky ideal, without a definite and practical outcome. It comes from the egos of a decaying hegemonic power and a narcissistic president that don’t live in a reality-based universe.
History shows us that those who launch trade wars and economic terrorism are always defeated. History also tells us that Iran, China and others can protect themselves in any escalating conflict.
President Trump and his necon faction should stop blowing in the positive aspects of their sanctions and trade-war gambit as it is already overblown. The pointless tussle, backed by no American ally in Europe and certainly no sound mind on the Capitol Hill, is far less about international law, trade balance and fair trade, and more about political power and American hegemony: The US hegemony of the world and the trade and technological dictatorships of American corporations.
The futile efforts and tariff gambits by the Trumpsters, who advocate a doctrine of permanent war, as well as their technological dictatorships, who try to push their opponents under the bus by supporting the post-colonial status quo, will only go this far. Their dreams of sanctioning foes into submission, dominating the world in financial-economic terms, and ensuring that no nation, or a bloc of nations, would ever challenge their unholy agenda, will never come true. What they fail to see is the catastrophe that their fantasies have caused for the US and global economies.