Trump is about to learn that trade wars involve casualties — for us as well as them. If the rest of the world forms a solid block against us, our casualties are going to be higher than we thought — it will no longer be just us against small economies like Canada and Mexico.
I just don’t see all of our trading partners as some sort of economic “OPEC” who are willing to live or die together.
Trump’s strategy (I believe) is to negotiate deals with individual countries. The one’s running the biggest balances of trade with us have the most to gain by cutting a deal and resuming that trade.
There are two questions: 1) will the short term pain be worth the long-term gain?; and 2) do we have the political will to have this fight until victory?
Our economy is the one purchasing most of the world’s output. If we stop buying their products and switch to domestic production and consumption, how do we lose in a trade war?
We will have some pain initially during the transition, in the form of higher prices, but as production returns home so will career type employment that pays well.
We’ve transformed our economy from a manufacturing based system to service based - and strategically that’s insane. China has built the PLA with our money - THAT HAS TO STOP, or we are going to be facing a larger, more advanced enemy for real, not just in trading.
While working at the Department of State, I wrote a proposal based on using US Food as a political carrot, or weapon have you, to influence UN member states by either withholding US Rice or Soybeans from the Global Markets, or equating simply equating Oil Barrels to fixed valuations of (for example) 5-bushels of Corn when dealing with OPEC. You probably get the point. Hillary's folks were quite upset with the proposal and we went back and forth 3 exchanges. Bottom line they felt the US had a obligation to not use natural resources or food or trade to gain advantage over other world nations. I think Trump understands at the end of the Trade War, my old paper on pegging Oil to Beans or dollars to China-paper will be the final blow to those who unfairly trade with the US. This trade war will be in full effect after the Mid-Terms.
IF! The world formed a solid block. Now that right there is something to worry about.
I'm sure that Trump is aware of the fact that in the short term, prices will increase - that's a given. What the anti-tariff hysterics don't seem to be aware of is that supply and demand aren't static and that those upticks in price aren't permanent - i.e. global supply chains can be replaced with domestic ones, and as domestic production increases to meet the demand, those prices will rise, while in the meantime supporting domestic rather than foreign production.