Some Basics about U.S. Tariffs, and What Trump’s New Economic Team Said about Tariffs

By Wolf Richter –  WOLF STREET

The proposals by the incoming Trump administrations to levy new and additional tariffs against China, Canada, Mexico, the EU, etc. have unleashed a torrent of anti-tariff nonsense in the media, pushed by globalization-mongers, by Corporate America perennially in search of cheap labor, and by foreign countries that have been riding this big US gravy train.

The result of this “one-sided free-trade policy” over the decades has been the gigantic and ballooning US trade deficit (exports minus imports). Exports add to GDP, imports subtract from GDP, and the trade deficit has been a huge drag on GDP, in addition to causing all kinds of other issues, such as the strategically risky dependence of the US supply chains, and thereby the economy, on Chinese companies, many of them state-controlled.