Insane Clown running the USA government: Trump's tariffs

"Sometimes I wonder if the world is being run by smart people who are putting us on or by imbeciles who really mean it."  -- Mark Twain

I think we all have the answer to that, at least in America.

Mad King Don revealed his magic tariffs this week, and you couldn't have even imagined what they would be.

Donald Trump’s “Liberation Day” speech, announcing mammoth new tariffs on pretty much everybody, sent markets into freefall around the world. CNBC’s Jon Fortt summed up the instantaneous response on air yesterday: “The market reaction after hours, I’ve never seen anything like it."

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Trump’s new trade course is different, as investors are now realizing to their horror. It isn’t just the biggest U.S. tariff hike in more than a century. It’s an attempt to build a new trade regime on the bedrock of his two basic policy fantasies.

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First, tariffs are a positive good that enrich a country at the expense of its neighbors with no internal trade-offs. Second, trade deficits are inherently bad: If your country is buying more goods from another country than they’re buying from you, you’re losing.

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Markets have tended to brush aside these beliefs, which Trump expresses all the time in public, because they’re insane fantasies that, if pursued in policy, would crash the U.S. economy. After all, Trump talked this way all through his first term, but his actual policies fell short of his rhetoric: The protectionist actions he did take may have crimped things here and there, but they were ultimately not large enough to throttle otherwise strong U.S. and global growth.

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[T]he rates were based on a simple formula: our trade deficit with a country divided by the amount we import from that country, all divided by two. The bigger our trade deficit with a country, the higher the tariff rate. Bizarrely, the White House insisted it had not done this—while releasing equations showing that’s precisely what they had done.

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The current economy is constituted around a different set of assumptions, like that Americans want to be able to buy $5 T-shirts but find the idea of working in factories producing $5 T-shirts unpleasant, or that we are happy to be able to buy and drink coffee from equatorial countries whether or not equatorial countries buy equivalent quantities of goods from us. These are the sorts of realities the White House seems determined to stamp out.

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Consumer prices on pretty much anything manufactured abroad—or manufactured with parts made abroad—will soar quickly. Businesses organized around imports will feel the immediate squeeze. U.S. exporters are all but guaranteed to be harmed as well—not only by rising costs on their own imported inputs, but by actually reciprocal tariffs we’re likely to see from other countries in response. And all this will create the sort of economic chaos and upheaval that destroys market efficiency, vaporizing trillions in value to the benefit of literally nobody.

  The Bulwark

Whoa, Ron.  Be very careful.

There are other places on Trump’s tariff list that also aren’t huge economic powers, to put it mildly.

Tokelau is a self-administered territory of New Zealand consisting of three atolls in the South Pacific Ocean with a population of about 1,600, according to the CIA Factbook. It has an economy of about $8 million and exports of around $100,000, the CIA says. Now, it too faces 10% tariffs.

One enclave hit particularly hard by Trump’s tariffs is Saint Pierre and Miquelon, a French territory of eight small islands near the Canadian province of Newfoundland. With a population of about 5,000 people, its “the sole remaining vestige of France’s once vast North American possessions,” the CIA Factbook says. Its exports – “processed crustaceans, shellfish,” according to the CIA – are now subject to a whopping US tariff of 50%, way more than France faces (20%) as part of the European Union.

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The British Indian Ocean Territory faces a 10% tariff. It’s populated only by about 3,000 British and American military personnel and contractors at the Diego Garcia airbase. The CIA Factbook lists its major export as fish, but it’s unclear who does the fishing (or who buys it).

The Marshall Islands, a group of 34 atolls and islands in the North Pacific, is home to 82,000 people and a key American military installation, the US Army Garrison Kwajalein, which helps in ballistic missile testing and tracking.

  CNN

So...tariffing ourselves. Brilliant.  Will we impose counter-tariffs.

Howard Nutlick, as Ron Filipkowski calls him.

In the Truth Social post, Trump said that one of his goals with the tariffs was to "penalize Canada for the sale, into our Country, of large amounts of Fentanyl, but Tariffing the value of this horrible and deadly drug in order to make it more costly to distribute and buy."

Given that fentanyl is an illegal drug, the government collects no taxes from its purchase or sale.

Trump seemingly not understanding this fact led to many puzzled reactions.

  Raw Story

Mocking reactions, more like.

Aaron Reichlin-Melnick, a senior fellow at the American Immigration Council, made the case that this wasn't a simple slip-up from Trump as this was "the second time in the last 24 hours" that Trump has suggested taxing fentanyl.

Well, in fact...

Whoa...Ted!  Be very careful.

TRUMP HAS AN OBSESSION WITH TRADE. He always has, and his views are wrong historically, economically, and even morally. At his Rose Garden declaration of “Liberation Day,” he repeated his oft-stated view that the United States has been “looted, pillaged, raped and plundered by nations near and far” for fifty years and more. Long-term trade deficits, he declared, are a “national emergency” that “threaten our way of life.”

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If we buy coffee from Costa Rica and they buy nothing from us (which isn’t true, but just as an illustration), in no sense has Costa Rica taken advantage of, far less “raped” America. We gave them dollars and they gave us coffee in return. That is called commerce, and nearly every exchange between a willing buyer and willing seller yields two winners, not one. Besides, as those first-term Trump advisers also tried to convey, those Costa Rican businessmen then take those dollars and buy American treasuries and other assets. There are no losers in this equation.

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A WALL STREET JOURNAL EDITORIAL described the tariffs President Donald Trump unveiled this week as the “dumbest trade war in history.”

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[Trump's] stubborn strain of stupidity belongs on a list of deadly sins. And that weak-mindedness is now plunging the world into chaos and potentially into depression.

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All of those supposedly worldly-wise Wall Street types who either supported or did not oppose Trump’s return to power deserve some of the blame today.

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Even if Wall Street executives and others who chose to believe that Trump was preferable to Kamala Harris were indifferent to civil liberties, public health, or the administration of justice, you’d think they’d be interested in their own bottom lines. You would think they might have noticed that one of Trump’s only long-term convictions was that America had been victimized by world trade and that tariffs would solve all of our problems. During the 2024 campaign, there was almost no issue that Trump did not claim tariffs would resolve, including the federal budget deficit, joblessness (though unemployment was already low), high taxes (tariffs are taxes), war, and of course the trade deficit.

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The global trading system the United States shepherded into existence after World War II has been a boon to people around the globe, and no one has benefited from it more than the people of the United States. We’ve run trade deficits with many nations for many reasons: sometimes as a reflection of savings and investment rates in other countries (think Germany), sometimes as a function of relative wealth (Vietnamese consumers can’t afford to purchase as many American products as Americans can Vietnamese products).

  Bulwark

Fuck the poor. Am I right, Donald?

But in any case, it doesn’t really matter, because countries with big trade deficits can be super-wealthy. The United States has run trade deficits since the late 1970s and has also been the richest nation on the globe during those years. In fact, even during Trump’s first term, which he has loudly proclaimed to have been the greatest economy in the history of the universe, we consistently ran trade deficits. In fact, the trade deficit increased during the first Trump administration from $481 billion in 2016 to $679 billion in 2020.

In a saner world, Trump’s delusions would not decide U.S. policy. They’d be checked by his own advisers, the Congress, and the public. But here we are.

"Just."

That's what worries us.

Yeah, is that happening?

Is that a corollary (or something) to people who give up liberty for safety get neither?

Trade wars are good and easy to win, right Don?

I wonder what retributive tariffs the penguins and the drug lords are going to impose.

Bingo.

It would be awesome if all blue states could get around Trump madness like this.  

Maybe he should ask his constituents how they feel about that.

I see Fox has restored its market ticker.

UPDATE 11:20 am:

That's gonna be hard on 2026 Republicans.

Exactly.  He is the man who would be king.