'Dangerous territory': Experts warn Trump’s 'sweeping tariffs' could destabilize 'dicey' US economy
Donald Trump with House Speaker Mike Johnson and others on December 14, 2024 (Wikimedia Commons)
December 24, 2024
ALTERNET
Some of President-elect Donald Trump's defenders have predicted that he will back down from his promise to impose major tariffs on Canada and Mexico after he returns to the White House in 2025.
But so far, Trump is showing no signs of backing down. And he had said that from Day One, he will impose 25 percent across-the-board tariffs on all products coming into the United States from those countries as well on products from Mainland Chiona.
During a Tuesday, December 24 appearance on CNBC's "Squawk Box," two economists — Elizabeth Pancotti, director of the Roosevelt Institute, and Veronique de Rugy (a senior research fellow for the Mercatus Center) — were confident that Trump would follow through with the "sweeping tariffs" he has promised. And Pancotti warned that they could be "inflationary."
Pancotti said, "I think we have an issue where Trump is signaling to the market, to CEOs, to other countries he's going to do the sweeping tariffs he campaigned on. And to some extent, they're not believing him — and even some senior advisers are saying: no, no, it won't be what you think it is.
The Roosevelt Institute senior director predicted, however, "there will be some pretty sweeping tariffs" during the "first 100 days" of Trump's second presidency "rather than the targeted and strategic tariffs" that the U.S. has had under President Joe Biden.
Those "sweeping tariffs," according to Pancotti, "could really place inflationary pressures throughout our economy."
De Rugy didn't disagree with Pancotti's predictions.
Some of President-elect Donald Trump's defenders have predicted that he will back down from his promise to impose major tariffs on Canada and Mexico after he returns to the White House in 2025.
But so far, Trump is showing no signs of backing down. And he had said that from Day One, he will impose 25 percent across-the-board tariffs on all products coming into the United States from those countries as well on products from Mainland Chiona.
During a Tuesday, December 24 appearance on CNBC's "Squawk Box," two economists — Elizabeth Pancotti, director of the Roosevelt Institute, and Veronique de Rugy (a senior research fellow for the Mercatus Center) — were confident that Trump would follow through with the "sweeping tariffs" he has promised. And Pancotti warned that they could be "inflationary."
Pancotti said, "I think we have an issue where Trump is signaling to the market, to CEOs, to other countries he's going to do the sweeping tariffs he campaigned on. And to some extent, they're not believing him — and even some senior advisers are saying: no, no, it won't be what you think it is.
The Roosevelt Institute senior director predicted, however, "there will be some pretty sweeping tariffs" during the "first 100 days" of Trump's second presidency "rather than the targeted and strategic tariffs" that the U.S. has had under President Joe Biden.
Those "sweeping tariffs," according to Pancotti, "could really place inflationary pressures throughout our economy."
De Rugy didn't disagree with Pancotti's predictions.
"I don't see how he's not doing it," De Rugy said, "and I also agree his cabinet and people around him are trying to reassure everyone around that, no, no, it's just a way to get lower tariffs around — around the world. But we're going to see. I mean, he's promised — his base is very pro-tariff, I assume, because they've been told how great it's going to make things."
De Rugy added that Trump is putting together a second administration that includes some "traditional" conservatives but is, overall, much different from his first one. And he is nominating people who have touted "all the great stuff you can do with tariffs."
De Rugy said, "I think we're going to see tariffs. I mean, we're going to see sweeping tariffs…. We're getting in dangerous territory. And let's not forget: inflation is not back to target. In fact, it's ticking up…. I think it's dicey out there."
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