What should the EU do when Trump wins the next election? They'll still be hurt regardless. Whatever will be made in the US will be more expensive and retailers will have to bear that cost or make prices higher. So even in the case where tariffs will bring back US jobs the inflationary effects will be permanent. — Mr Bee
North American free trade undermines the position of US labor. It gives the US a more flexible labor force by putting it in competition with Mexicans who have a lower cost of living. That issue was raised during the Clinton years when NAFTA was initiated, but the establishment promised that over all, free trade would help Americans. That hasn't turned out to be true. The only people who really don't want a return to the way things were pre-NAFTA are certain Wall St. entities. If Trump did succeed in returning the US to a pre-1990s trade position, it would be the first step in the recreation of American labor unions. It would mean demands for a better social safety net would have power behind them.
I don't like Trump, mainly because I don't want to hear his mouth, but on this issue, he's actually lining up with exactly what he said he wanted to do back in 2016: shore up the position of American labor.
The timeframe that's been thrown around is a decade. You can't just simply rebuild entire supply chains in a couple of years, one with the connections and an experienced workforce, especially if a good chunk of that workforce is gonna be deported. — Mr Bee
I guess it depends on what commodity we're talking about. I think the main thing we get from Mexico is agricultural products. What kind of supply chain were you thinking of?
But if you think Trump should impose these massive tariffs permanently and that the economy and prices would somehow work itself out before the midterms or the next presidential election, that's fine by me — Mr Bee
I mean, inflation is coming down. The Fed is set to decrease rates again next year. When I say I think the tariffs will be permanent, I mean that it won't be possible to form a coalition to get rid of them again. As for Europe, I don't think it's even on the American radar at this point. I think we'll be parting ways in terms of fundamentals.