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Trump: the following tariffs for national security: car prices



P Resident Trump has already used national security to justify damage to steel and aluminum tariffs. Now he is considering doing the same thing with cars and auto parts. No, thank you, Mr. President.

Tariffs to 25 percent of cars and auto parts, however, may be abroad. The report of the Ministry of Commerce on the National Implications for imported cars and automotive spare parts to the White House falls on February 17.

This report will be the first step for Trump, who has decided to introduce new tariffs in accordance with Section 232 of the 1

967 Trade Expansion Act. This section gives the president a loophole for entering tariffs without passing through the Congress if the Department of Congress recommends that certain goods be vital for the national security of the country and therefore need to protect trade to encourage domestic production. .

Now, if this sounds absurd (Toyota, Honda or even Porsh imports, which really hurt our ability to protect ourselves?), It's not under the control that the Trump Trade Department decides what they are. In the end, the same department previously recommended that the country be justified in the introduction of rapid tariffs for steel and aluminum.

To understand why Trump would be interested in introducing new taxes and tariffs are definitely taxes, it is very important to look at the political ambitions of 2020 Trump.

Like steel tariffs, his purpose with the new assembly is not to save the country safely, rather than symbolically return the production. Trump wants to protect jobs for what is probably right, he considers the basis of his base, while relying on promises to voters.

Politically, he probably is not mistaken. Saving jobs in Michigan would be an important selling point for voters in the state, which played a significant role in sending it to the White House. But trade policy should not be about attracting special attention to political support. Instead, the President must focus on what is generally good for the country. With cars, this means no taxes that will likely increase the average car price in the US for more than $ 1,000 and potentially as much as $ 4400. These costs take real losses on the domestic business with retailers of cars, potentially losing up to $ 66.5 billion Revenues.

Even worse, potential car prices are unlikely to have the desired effect. On the one hand, even domestic producers rely on materials imported from abroad, or even factories located elsewhere. Tariffs will not help US-based producers who depend on trade to profit. Moreover, as happened with the tariffs set out in Section 232, other countries are likely to meet their own tariffs which will have unpredictable but destabilizing effects on the US economy.

Tariffs, except for specific and narrow scenarios, are generally a bad economic policy. They reduce free trade, provide governments with the ability to choose winners and losers through unclear dismissal decisions, and ultimately cost consumers and businesses.

Typically, the Republicans understood this and were a fairly free trade group, leaving protectionist tariffs and raising taxes to democrats.

Some Republicans seem to remember their principles. Indeed, Sen. Chuck Grassley, R-Iowa, made it clear that he primarily objects to new car prices, explaining: "Increasing car and spare parts tariffs will be a big tax on consumers buying or servicing their cars

But in order to stop such abuses of presidential powers, legislators should reject more than words. Those who are really interested in this should uphold the legislation proposed by Sens. Pat Toomey, R-Pa., And Mark Warner, D-Va. That will not allow the president to introduce tariffs, including cars, without Congressional approval.

Despite the fact that the president relies on the principles of free trade, which underlie a strong economy, it is not in the interests of a country that wins much more from strong growth than expensive tariffs under the guise of national security.


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