Trade War Escalates, President Trump Blamed for Making Biggest Financial Mistake Since the 1930s

Trade War Escalates, President Trump Blamed for Making Biggest Financial Mistake Since the 1930s993
source: Pixabay

The ongoing trade war with China entered a new phase Friday when President Trump angrily responded to the retaliatory tariffs on the U.S. made goods Beijing proposed. Donald Trump even went further on Twitter, saying that the U.S. companies should move their businesses out of mainland China.

China announced Friday that it had imposed tariffs against $75 billion worth of 5,078 U.S. products, adding up to 10% on a total of top of current rates in the latest trade dispute between Washington and Beijing.

In an official statement, China's ministry of commerce said that the increased taxes would affect agricultural products, including soya beans. They will also impact the light aircraft industry and crude oil production. In addition to that, the cars and car repair parts imported from the U.S. will also be affected.

The ministry of commerce said that the decision is a result of the ongoing  U.S. politics of unilateralism and protectionism.

In response, President Trump said that Washington would raise its current tariffs on $250 billion worth of Chinese products to 30% from the existing 25% as of October 1, when Beijing celebrates the 70th anniversary of the establishment of the People's Republic of China.

President Trump did not stop here. He also used the occasion to blame Jerome Powell, the chairman of the Federal Reserve, appointed personally by Trump, for the current state of our economy. In his next angry tweet, the President wondered who was the ''bigger enemy'' of Washington - Powell or the Chinese President Xi Jinping.

The U.S. Consumer Technology Association, representing 2,200 companies from the technology sector, heavily criticized President Trump's decision to escalate tariffs on Chinese goods. In their view, that is the worst financial mistake the United States has made since the 1930 Smoot-Hawley Act. The group stated that it is already clear that the tariffs are not moving Washington toward a trade deal with China.

David French from the National Retail Federation also expressed his disagreement with the new tariffs hike. He pointed out that it is no longer possible for the businesses to plan for the future. In his view, Trump's administration should change its current approach on China because it is clear it does not lead the economy in the right direction.

The Alliance of Automobile Manufacturers and the Association of Global automakers also joined the debate. In their opinion, the tariffs are bad for the end consumer, and they even put American jobs at risk.

What do you think? Do you agree or disagree with the statement that the tariff hikes are the biggest financial mistake since the Great Depression?