With a grand consensus of respected economists from across the political spectrum now agreeing that Donald Trump’s stewardship of America’s financial prospects have been disastrous for our economy, CNN‘s Jake Tapper gave one of the president’s top economic advisors the opportunity to respond to their analyses on this morning’s edition of State of the Union.
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The encounter did not go well.
Peter Navarro, an Assistant to the President and Director of Trade and Manufacturing Policy, continued to stay glued to Trump’s false narrative that his trade war and unilateral imposition of tariffs in key manufacturing and agricultural sectors were not affecting the economy in any way damaging to the American people.
While there are a multitude of farmers and factory workers who could give personal testimony to the contrary, Tapper was armed with a litany of economists, analysts and business publications who believe that Trump’s policies are an unmitigated disaster and that the president is hiding the truth about the economy and the failure of his strategy from the public.
Faced with Navarro’s continued unsubstantiated denial that the Trump tariffs were ultimately being paid for by the American public, Tapper challenged the White House advisor with a list of critics who strongly believe that that delusion is an attempt at pure obfuscation by the Trump administration.
“I want to give you an opportunity to address the fact that you keep saying that China’s bearing all the [tariff] burden,” Tapper confronted Navarro. “That goes against what we’re hearing from researchers at Harvard, the University of Chicago, the International Monetary Fund, the Federal Reserve Bank of Boston, former Trump adviser Gary Cohn — who I know you have clashed with — and the editorial board of the Wall Street Journal which is conservative.”
“Economist after economist says you’re not being straight with the American people on who is bearing the burden of these tariffs. Why are all these people lying and you’re telling the truth?” the CNN host wondered aloud.
Navarro responded with a continuation of his earlier denials, oblivious to reality or purposefully ignoring it.
“All I would say to you is look at the data. There’s absolutely no evidence, no evidence whatsoever,” Navarro claimed before Tapper interupted him.
“Did the study I told you about…” he interjected before Navarro cut him off.
“There’s no evidence whatsoever that American consumers are bearing any of this,” Navarro falsely stated. “We know China is slashing prices. They’re slashing the value of the yuan. They’re hemorrhaging their manufacturing base. I’d be happy to look at some of those studies, but I can tell you this: this president is committed to standing up to China and getting a good deal for the American people.”
“The party told you to reject the evidence of your eyes and ears. It was their final, most essential command,” George Orwell wrote in 1984 as if foretelling the Trump administration.
Here is the evidence to refute the Trump party line, direct from the independent Urban-Brookings Tax Policy Center, a definition of tariffs and who pays them:
“A tariff is a tax on imported goods. Despite what the President says, it is almost always paid directly by the importer (usually a domestic firm), and never by the exporting country. Thus, if the US imposes a tariff on Chinese televisions, the duty is paid to the US Customs and Border Protection Service at the border by a US broker representing a US importer, say, Costco.”
While the importers who pay tariffs have the discretion to not pass the increased costs to consumers, such a decision will hurt the companies’ profits. Alternatively, if it makes financial sense and an alternative supplier is available for the goods from somewhere not subject to tariffs, they can simply buy goods from other suppliers, but these are conditions that are not always possible to fulfill.
Either way, the stock and bond markets will make their own assessments of whether Trump’s economic policies are harmful or not. Judging from the current inverted yield curve in the bond market and the subsequent precipitous fall of stock prices, it looks like they’ve already made their decision and it’s not favorable for Trump.
You can watch Jake Tapper confront White House Economic Advisor Peter Navarro in the video attached to the tweet below.
— State of the Union (@CNNSotu) August 18, 2019
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Original reporting by Tom Boggioni at RawStory.