President Donald Trump turned to steel imports as a solution to his obsession for profits. Therefore, all nations across the planet might feel a direct impact if this idea becomes a decision. A 20% tariff is hefty enough to set back international economies.
Trump Might Put into Practice One of His Electoral Promises Regarding Free Trade
According to official documents, Trump scheduled a meeting on Thursday. The members who received an invitation are key advisers close to the president. Even though some of them were adamant in their views that such a strategy might have severe economic consequences, the conclusion of the meeting was heavily in favor for a drastic tariff on steel imports.
On the other hand, Donald Trump remains loyal to his electoral promises. One of his core resolutions was centered on free trade which rooted from his criticism against Japan, Mexico, and China. In the end, Trump’s fierceness for this international competition made him even allude to a trade war.
Trump’s upcoming decisions might reshape the global economy for good. Such a sudden increase in tariff might make America’s top trading partners to respond. Chinese officials will have no choice than to categorize this new policy as an aggressive trade move.
A Bigger Tariff for Steel Imports Can Be Replaced with a Massive Infrastructure Plan for Even Better Results
This type of decision might trigger dire consequences that would definitely affect even American companies. While the United States has a vast production of goods, large enterprises can’t oversee every aspect of their products. Therefore, they prefer to delegate certain tasks.
As a consequence, most heavy responsibilities such as parts production are shifted abroad. In the end, American companies will have to pay for themselves for the new 20% tariff. This chain of consequences will surely reach clients as well. Companies will jump prices to protect their profits.
However, experts point at another method to boost steel production with all these negative consequences left behind. Trump administration can order a major plan for infrastructure improvement for instance. The government can fund this project. As a consequence, steel demand will skyrocket while the government creates more jobs for Americans.
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