President Trump is often portrayed as being mercurial and transactional, but his economic policy framework flows from tangible principles that he has venerated for decades. For a start, Trump maintains the U.S. has been too magnanimous in providing other countries with access to the American consumer and our defense umbrella. He believes this should be conditional on balanced trade and a level playing field, otherwise tariffs are justified. Similarly for defense, where several Presidential administrations since Eisenhower’s including those of Kennedy, George W. Bush and Obama have commented that numerous NATO countries are free riding on American mettle. Further, Trump deplores the decline of domestic manufacturing jobs and is resolved to propel a revival.
In this paper we examine tariffs from the American perspective, look at China’s leading role in the ongoing trade war and discuss the macro and market consequences and implications for investors.
