Donald Trump

Trump Doesn't Understand How Tariffs Work, Brags About Making Up Trade Stats

From "bowling ball tests" to tariffs, the president doesn't know what he's talking about. His ignorance grows more dangerous each day.

|

AdMedia/Newscom

In a speech to Republican donors on Wednesday, President Donald Trump bragged about making up fake statistics during a meeting with the Canadian prime minister and argued that tariffs on imported steel would stimulate domestic car manufacturing despite mounting evidence that the exact opposite will happen.

Trump's comments, reported Thursday by the Washington Post, which says it received a recording of the address, suggest a disregard for facts and a level of economic illiteracy that is remarkable even by the president's own standards. The Post described the 30-minute speech as a "blistering attack against major U.S. allies and global economies."

In one part of the speech, Trump reportedly claimed that Japan used a bizarre gimmick to prevent American cars from being imported there. From the Post:

"It's the bowling ball test. They take a bowling ball from 20 feet up in the air and drop it on the hood of the car," Trump said of Japan. "If the hood dents, the car doesn't qualify. It's horrible," he said. It was unclear what he was talking about.

Trump said he didn't even want Japan to pay the tariffs but to build more automobiles in the United States, adding that Japan would do so if tariffs were imposed.

As crazy as the so-called "bowling ball test" is, what follows is actually more insane. Trump seems to be suggesting that tariffs on steel could make Japanese car companies manufacture more cars in the United States, but the 25 percent tariffs he signed last week will make it more expensive to build cars in the United States. That's true for both domestic and foreign automakers.

The tariffs only apply to raw and unprocessed steel—in other words, they do not apply to imported items made from steel, like cars. Instead of encouraging more automobile manufacturing in the United States, Trump's tariffs create incentives for cars (and anything else made with steel) to be built elsewhere and imported, tariff-free, here.

Toyota, a Japanese company that operates six manufacturing plants across the southern United States, has warned that Trump's steel tariffs will jeopardize American workers' jobs at those facilities.

The president's remarks, as reported by the Post, suggest that he is either completely ignorant of how tariffs work, or that he does not care about the potential economic damage they could do.

Other comments made by Trump during Wednesday's speech suggest the former.

Trump said that in a meeting with Canadian Prime Minister Justin Trudeau, he rebutted the claim that Canada has a trade surplus with the United States. Even after being told by one of aides that it was true, Trump maintained that "we lose $17 billion a year" when energy and timber are included in the calculation.

Trump made a similar claim on Twitter this morning.

He's wrong. The United States has a trade surplus with Canada, according to the Office of the United States Trade Representative.

This sort of willful ignorance about the importance of trade, the distorting effects of tariffs, and basic economic facts might be humorous if Trump didn't have the power to do such significant damage with the stroke of a pen. He was able to impose the steel tariff (and a similar one on aluminum) without congressional approval by claiming the maneuver was necessary for national security reasons. He has repeatedly threatened to pull the United States out of NAFTA and to tear up a trade deal with South Korea. According to the Post, Trump threatened to pull American troops out of various allied nations if he didn't get what he wanted on trade.

Bringing our troops home sounds like a good idea, of course, but using them as leverage in a trade war after nearly two decades of actual war is obscene.

Likewise, what Trump wants on trade makes no sense. He wants tariffs, but also wants more cars manufactured in the United States. He wants to renegotiate trade deals between America and its top trading partners, but then brags about making up statistics during a meeting with a trusted foreign leader. How is any of that supposed to lead to better deals?

Some of Trump's defenders have argued that the tariffs are only a tactic in the administration's plans to renegotiate trade deals—as if setting fire to the economy is a strategic first step towards saving it. Trump's comments on Wednesday night belie any claim of a master plan that results in the U.S. coming out on top. From "bowling ball tests" to tariffs, the president doesn't know what he's talking about, and his ignorance grows more dangerous each day.

NEXT: Larry Kudlow, Trump's New Economic Adviser, Is a Longtime Advocate for Low Taxes and Free Trade

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. Say you’re a policy advisor of some sort and Trump direly wants to do something you know is enormously detrimental. Do you go along with it to stroke his ego or tell him to fuck off?

    Assume you’ll be fired either way.

    1. until I saw the paycheck of $8554 I did not believe friend was like actualy bringing in money in there spare time at their computer there brothers friend has been doing this for only about 23 months and at present repaid the morgage on their home and got themselves a Mitsubishi Evo read this article http://www.richdeck.com

    2. Begin winning $90/hourly to work online from your home for couple of hours every day… Get customary installment on a week after week premise… All you require is a PC, web association and a litte extra time…

      Read more here…….. http://www.startonlinejob.com

  2. …Trump’s tariffs create incentives for cars (and anything else made with steel) to be built elsewhere and imported, tariff-free, here.

    Then what are our allies complaining about?

  3. ignorance grows more dangerous

    Maybe your awareness of it, but I’m fairly confident he’s just a dumb as the day he was elected.

    If you’re still shocked by is ignorance, they you really REALLY haven’t been paying any attention.

    AND…it still doesn’t much matter. Because his ignorance is a direct reflection of the ignorance of the populace. Which is why he got elected in the first place. Shoot from the hip…go with your gut…let the advisers work out the details.

    1. The fly-over analphabets can be counted upon to be dumber than Lloyd Christmas and Harry Dunne. What fucking moron would ever think that the fake Orange one was looking out for, and had the back of, and actually gave a shit about, the little guy?

      1. I don’t really agree. I think he thinks his actions show that he has their back.

        1. Whether he thinks that his actions show that he has their back is one thing; that the flyovers actually think that he has their back is quite another.

      2. Nothing says “populist” like having every appliance you own gilded.

        1. Wait, he gilded his appliances?

          Holy hell that’s trashy af

          1. He is what his followers imagine when they picture “rich.”

            1. “He is what his followers imagine when they picture “rich.””

              He is what Tony imagines when Tony pictures “rich”.

      3. The really depressing part? I know quite a few people that I had long regarded as reasonably intelligent, small government constitutional conservatives (Not exactly libertarians, but with a lot of common interests.) who have gone all in for the Trump cult. I don’t know whether to blame it on latent racism, economic illiteracy or political tribalism, but they insist that every flip, flop and flail is all part of a brilliant master plan, and that Big Daddy Donny will lead us to the Promised Land.

        1. Yeah, been my experience as well. Not with all, but with a surprising number of people who were not as well thought out as I had imagined them to be.

        2. I have two theories. One, Trump is less-bad than the roster we’ve had since Reagan. His cabinet choices, while not perfect, are pretty sound, and he did some good things like cut taxes. Therefore they should throw their weight behind him, since anyone else is going to be demonstrably worse. If this means drinking the kool-aid then so be it.

          Two, they are just disgusted with the entire apparatus of government, and Trump is a perfect clown to play ringleader to that circus. Pure apathy.

          1. “One, Trump is less-bad than the roster we’ve had since Reagan.”
            For all the TDS-inflicted:
            You don’t have to like a loose-cannon and blowhard to be pleased that the results so far are ‘way beyond any POTUS in my memory:
            1 DeVos
            2 Gorsuch
            3 Ajit Pai, end net price fixing
            4 Major reduction in the growth of regulations “By one key measure of regulatory growth — the page count of the Federal Register, which lists all new rules — Trump reduced regulation by almost 50 percent in 2017.
            5 Got repeal of the national medical insurance mandate.
            6 Withdrawal from Paris climate agreement.
            And more.
            I know to those suffering TDS my listing of those makes me a ‘Trumpster’ or some such idiocy; so be it.
            On the morning of 11/10/16, I had hopes that we’d dodged a SCOTUS appointment which would haunt us for years; I’ve been pleasantly surprised.

            1. Not sure why it’s ‘TDS’ to be horrified at a series of mostly appalling and disastrous political actions like the ones you list just because you yourself happen to be stupid enough to think they’re good, or why that wouldn’t make you a ‘Trumpster.’

  4. I kind of disagree with this. First of all, most things presidents do with ‘the stroke of a pen’ are terrible and it’s just that now we’re starting to realize it. But fortunately we can know about it almost immediately and speak out and that’s the most important thing. Because then at least he is held to account and we don’t discover it years later after all the damage is done. Secondly, other countries do in fact treat us unfairly, and Trump is right to fight for the US. For example, China steals our intellectual property. How to retaliate other than trade?

    1. TPP was the perfect retaliation. Set the Pacific Rim up along US free trade rules and push China back.

      (but the Dotard fucked that up – along with plenty of idiot Democrats)

      1. Yes, thank you. I admit my previous comment was a bit too harsh. Trump is dangerous. But thanks to the writers at Reason, we can at least hold him to account!

      2. As I recall, Trump spoke out against the TPP during the campaign specifically on the grounds that we were getting raped by China so why the hell would we want to make a trade deal with them. Had no idea what the hell he was talking about but had no trouble at all talking loudly about it nonetheless. And I’d bet you a fat dollar that if you were to take a survey, a significant portion of the electorate would identify the TPP as a trade deal with China.

        1. I remember during a primary debate when Trump made a comment about how bad the TPP was because of China, and then Rand Paul pointed out that China wasn’t even in the TPP. It was hilarious.

          1. Yes, that was hilarious and didn’t gain Rand Paul a single GOP vote.

            1. Such is the world we live in.

    2. Examples from yesteryear:

      1. Poppy Bush claiming that he had started Yale’s United Negro College Fund branch and that he had actively fundraised for UNCF during his last year at Yale.

      2. Poppy Bush claiming that he was the only Texas congressman to vote for the Fair Housing Act of 1968.

      3. Just about anything that effete Waspy wimp ever said.

    3. Good points. I considered that although EOs and other “strokes of the pen” are gross misuses of power, they are at least easily undone by the next president, and the judiciary has been policing the worst of the overreach. Obama got Repubs to pay attention when they didn’t care about Bush doing EOs, and now Trump is making Dems cognizant of how Obama abused EOs and subsequently gave Trump the power to do it.

      Laws, like you said, sink in slowly after a whirlwind session of Congress, and they’re difficult to reverse. Which is why we shouldn’t make so many in the first place.

      Re: tariffs v. China. I read somewhere that the Chinese government subsidizes taxed items so that businesses don’t feel the tariffs. Obviously that has a breaking point, but the raw steel tariff will do nothing to curb China. The earlier article about Larry Kudlow has him advocating for tariffs targeted at just China to perhaps mitigate their misbehavior.

      1. Thanks! Another funny irony is that Trump exempted Canada and Mexico from the steel tariffs, so effectively he re-created the evil NAFTA. Even the dotard can’t miss the lesson in that.

        1. That’s the kind of behavior that folks tout as him trolling or playing 55-D chess. Some of it is definitely political misdirection, but I think many of his gaffes are just because he is haughty and ignorant.

  5. Eric’s gonna cry!

  6. It’s just the Trump roadshow! Don’t pay attention to his words… heh… presidents’ words don’t matter all of a sudden for some reason!

    What, aren’t you laughing at his funny jokes?

  7. Trump’s an idiot on economic matters, as he is on almost all matters (some of it massive idiocy). President Trump of the USA, a very good guy, doesn’t like saying that he’s an idiot (negotiating), but he is…on almost all things he is… and that’s how I know!

    It’s that bizarre “and that’s how I know!” at the end there that really sells it that this is indeed Trump himself tweeting this one. WHAT THE FUCK ARE YOU TALKING ABOUT? Jesus Christ, can you seriously not complete a single sentence or a single thought without wandering off into some other subject matter that nobody knows what the hell you’re talking about?

  8. Another fucking article that treats the term “trade deficit” as if it had actual economic significance.

    Can we please stop justifying his position by writing about it as though it’s an actual problem? THERE ARE NO LOSERS IN A TRADE…DUMBASS!

    1. Please, just.. take a moment and look up what the term trade deficit actually means.

    2. Okay. You give me $10,000 and I’ll give you a ziplock bag full of cat vomit.

      1. If I accept that deal with no coercion, please explain where the trade deficit is.

        1. This is, like, still not what a trade deficit is referring to. See, e.g., google, describing it as the difference in value between a countries imports and exports. In dollar amounts.

          1. So we trade little slips of green paper for oil, electronics, etc.

            I know who benefits the most there.

            The Romans knew that the entity that controlled the money supply had the power.

          2. See, e.g., google, describing it as the difference in value between a countries imports and exports. In dollar amounts.

            Which means EXACTLY nothing.

            People trade…not countries.

            When I buy steel from you, you get my money, which yo value more than the steel, and I get your steel which I value more than the money you are asking for it.

            In the end, you have the money and I have steel. NO DEFICIT!

            NO LOSERS! VALUE FOR VALUE!

            1. Trump is an idiot and anyone who believes that a trade deficit equates to a loss is too.

      2. “Okay. You give me $10,000 and I’ll give you a ziplock bag full of cat vomit.”

        Thereby once again proving that Tony is an ignoramus.

  9. This isn’t an argument but I really hate this jew Eric Boehm constantly bashing Trump on Reason. Go write for CNN with the rest of the shapeshifters.

Please to post comments

Comments are closed.