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    Republican Party Rejects Free-Market Economics in Favor of Trump’s Signature Issues

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    Donald J. Trump’s presidency was a major turn away from the Republican Party’s long embrace of free-market economics. If the Republican platform is any indication, a second Trump term would be a near-complete abandonment.The 2024 platform, which was released last week and is expected to infuse the Republican National Convention that starts in Milwaukee on Monday, promises action on what have become Mr. Trump’s signature issues: It pledges to pump up tariffs, encourage American manufacturing and deport immigrants at a scale that has never been seen before.What it lacks are policy ideas that have long been dear to economic conservatives. The platform does not directly mention fiscal deficits, and, apart from curbing government spending, it does not make any clear and detailed promises to rein in the nation’s borrowing. Other policies it proposes — including cutting taxes and expanding the military — would most likely swell the nation’s debt.The Republican platform also does not mention exports or encouraging trade. And while the document insists that the party will lower inflation, long a pertinent issue for economic conservatives, it fails to lay out a realistic plan for doing that. Chapter One of the document, titled “Defeat Inflation and Quickly Bring Down All Prices,” suggests that oil-friendly policies, slashed government spending, decreased regulation, fewer immigrants and restored geopolitical stability will lower price increases. But few economists agree.In fact, many analysts have said Mr. Trump’s suggestions on the campaign trail so far could lift prices, particularly his proposals to deport immigrants en masse and apply tariffs of perhaps 10 percent on most imports and levies of 60 percent on goods from China.“Measures to reduce migration and to protect the economy through tariffs and trade blockages are all highly inflationary,” Steven Kamin, a former Fed staff official who is now at the conservative American Enterprise Institute, said in an interview last week. When it comes to both deficits and trade, he said, there is a “populist dismissal of the prescriptions of academics and elites.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Biden Announces Tariffs on Chinese Metals Routed Through Mexico

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    The measure aims to close a loophole that officials said allowed metals made partly in China to come into the United States duty free.The Biden administration took steps on Wednesday to prevent China from circumventing American tariffs on Chinese steel and aluminum by routing those imports through Mexico.The administration said it would impose tariffs on imports of Mexican metals that are partially made in China. American officials said the move would close a trade loophole that has allowed cheap, state-subsidized Chinese metals to circumvent existing U.S. tariffs.The United States will now impose a 25 percent tariff on Mexican steel that is melted or poured outside of North America before being turned into a finished product. Previously, that steel would have entered the country duty free.Mexican aluminum coming into the United States will face a tariff of 10 percent if it contains metal that has been smelted or cast in China, Belarus, Iran or Russia, said Lael Brainard, the director of the White House’s National Economic Council.Mexico, which recently increased its own tariffs on steel and aluminum from certain countries, will require importers to provide more information about where their steel products come from, the announcement said. The changes will take effect immediately.Officials in the Biden administration said the United States wanted to protect American factories that produce steel and aluminum, including those that have recently received new investments from government funds.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    One Obstacle for Trump’s Promises: This Isn’t the 2016 Economy

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    Donald J. Trump slapped tariffs on trading partners and cut taxes in his first term. But after inflation’s return, a repeat playbook would be riskier.When Donald J. Trump became president in 2017, prices had risen roughly 5 percent over the previous four years. If he were to win the race for the White House in 2024, he would be entering office at a time when they are up 20 percent and counting.That is a critically different economic backdrop for the kind of policies — tariffs and tax cuts — that the Republican contender has put at the center of his campaign.Mr. Trump regularly blames the Biden administration for the recent price surge, but inflation has been a global phenomenon since the onset of the coronavirus pandemic in 2020. Supply chain problems, shifting consumer spending patterns and other quirks related to pandemic lockdowns and their aftermath collided with stimulus-fueled demand to send costs shooting higher.The years of unusually rapid inflation that resulted have changed the nation’s economic picture in important ways. Businesses are more accustomed to adjusting prices and consumers are more used to those changes than they were before the pandemic, when costs had been quiescent for decades. Beyond that, the Federal Reserve has lifted interest rates to 5.3 percent in a bid to slow demand and wrestle the situation under control.That combination — jittery inflation expectations and higher interest rates — could make many of the ideas Mr. Trump talks about on the campaign trail either riskier or more costly than before, especially at a moment when the economy is running at full speed and unemployment is very low.Mr. Trump is suggesting tax cuts that could speed up the economy and add to the deficit, potentially boosting inflation and adding to the national debt at a time when it costs a lot for the government to borrow. He has talked about mass deportations at a moment when economists warn that losing a lot of would-be workers could cause labor shortages and push up prices. He promises to ramp up tariffs across the board — and drastically on China — in a move that might sharply increase import prices.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump Eyes Bigger Trade War in Second Term

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    The former president’s past tariffs raised prices for consumers and businesses, economists say. His next plan could tax 10 times as many imports.In March 2018, a day after announcing sweeping tariffs on metals imported from America’s allies and adversaries alike, President Donald J. Trump took to social media to share one of his central economic philosophies: “Trade wars are good, and easy to win.”As president, Mr. Trump presided over the biggest increase in U.S. tariffs since the Great Depression, hitting China, Canada, the European Union, Mexico, India and other governments with stiff levies. They hit back, imposing tariffs on American soybeans, whiskey, orange juice and motorcycles. U.S. agricultural exports plummeted, prompting Mr. Trump to send $23 billion to farmers to help offset losses.Now, as he runs for president again, Mr. Trump is promising to ratchet up his trade war to a much greater degree. He has proposed “universal baseline tariffs on most foreign products,” including higher levies on certain countries that devalue their currency. In interviews, he has floated plans for a 10 percent tariff on most imports and a tariff of 60 percent or more on Chinese goods. He has also posited cutting the federal income tax and relying on tariffs for revenue instead.Mr. Trump, who once proclaimed himself “Tariff Man,” has long argued that tariffs would boost American factories, end the gap between what America imported and what it exported and increase American jobs.His first round of levies hit more than $400 billion worth of imports, including steel, solar panels, washing machines and Chinese goods like smart watches, chemicals, bicycle helmets and motors. His rationale was that import taxes would revive American manufacturing, reduce reliance on foreign goods and allow U.S. companies to better compete against cheap products from China and other countries.Economists say the tariffs did reduce imports and encouraged U.S. factory production for certain industries, including steel, semiconductors and computer equipment. But that came at a very high cost, one that most likely offset any overall gains. Studies show that the tariffs resulted in higher prices for American consumers and factories that depend on foreign inputs, and reduced U.S. exports for certain goods that were subject to retaliation.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 113 Shares179 Views

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    Get Ready for the Debate Like an Economics Pro

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    What you need to know about the economy before Thursday’s showdown between President Biden and Donald J. Trump.President Biden.Doug Mills/The New York TimesFormer President Donald J. Trump.Haiyun Jiang for The New York TimesMany of the issues likely to dominate Thursday’s televised debate between President Biden and former President Donald J. Trump boil down to economics.Inflation, immigration, government taxing and spending, interest rates, and trade relationships could all take center stage — and both candidates could make sweeping claims about them, as they regularly do at campaign events and other public appearances.Given that, it could be handy to go into the event with an understanding of where the economic data stand now and what the latest research says. Below is a rundown of some of today’s hot-button topics and the context you need to follow along like a pro.Inflation has been high, but it’s slowing.Inflation jumped during the pandemic and its aftermath for a few reasons. The government had pumped more than $5 trillion into the economy in response to Covid, first under Mr. Trump and then under Mr. Biden.As families received stimulus checks and built up savings amid pandemic lockdowns, they began to spend their money on goods like cars and home gym equipment. That burst of demand for physical products collided with factory shutdowns around the world and snarls in shipping routes.Shortages for everything from furniture parts and bicycles to computer chips for cars began to crop up, and prices started to jump in 2021 as a lot of money chased too few goods.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    World Bank Sees Rosier Growth Outlook

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    But rising trade barriers pose a long-term threat to global output as protectionist policies spread, the bank said.The World Bank on Tuesday raised its outlook for the world economy this year but warned that the rise of new trade barriers and protectionist policies posed a long-term threat to global growth.In its latest Global Economic Prospects report, the World Bank projected global growth to hold steady at 2.6 percent this year, an upgrade from its January forecast of 2.4 percent, and predicted that output would edge higher to 2.7 percent in 2025. The forecasts showed the global economy stabilizing after being rocked in recent years by the pandemic and the wars in Ukraine and the Middle East.“Four years after the upheavals caused by the pandemic, conflicts, inflation and monetary tightening, it appears that global economic growth is steadying,” Indermit Gill, the World Bank’s chief economist, said in a statement accompanying the report.However, sluggish growth continues to haunt the world’s poorest economies, which are still grappling with inflation and the burdens of high debt. The bank noted that over the next three years, countries that account for more than 80 percent of the world’s population would experience slower growth than in the decade before the pandemic.The slightly brighter forecast was led by the resilience of the U.S. economy, which continues to defy expectations despite higher interest rates. Overall, advanced economies are growing at an annual rate of 1.5 percent, with output remaining sluggish in Europe and Japan. By contrast, emerging market and developing economies are growing at a rate of 4 percent, led by China and Indonesia.Although growth is expected to be a bit stronger than previously forecast, the World Bank said prices were easing more slowly than it projected six months ago. It foresees global inflation moderating to 3.5 percent in 2024 and 2.9 percent next year. That gradual decline is likely to lead central banks to delay interest rate cuts, dimming prospects for growth in developing economies.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 100 Shares149 Views

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    U.S. Adds Tariffs to Shield Struggling Solar Industry

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    American solar manufacturers are pushing for further protections for their new factories against cheaply priced imports from China.Tariffs aimed at protecting America’s solar industry from foreign competition snapped back into place on Thursday, ending a two-year pause that President Biden approved as part of his effort to jump-start solar adoption in the U.S.The tariffs, which will apply to certain solar products made by Chinese companies in Southeast Asia, kicked in at a moment of growing global concern about a surge of cheap Chinese solar products that are undercutting U.S. and European manufacturers.The Biden administration has been trying to build up America’s solar industry by offering tax credits, and companies have announced more than 30 new U.S. manufacturing investments in the past year. But U.S. solar companies say they are still struggling to survive as competitors in China and Southeast Asia flood the global market with solar panels that are being sold at prices far below what American firms need to charge to stay in business.That has forced President Biden to make an uncomfortable choice: Continue welcoming inexpensive imports that are helping the United States transition away from fossil fuels, or block them to protect new U.S. solar factories that are benefiting from taxpayer money.The tariffs that take effect Thursday encapsulated that dilemma. The levies, which apply to certain solar products coming to the United States from Cambodia, Thailand, Malaysia and Vietnam, were approved two years ago, after U.S. officials ruled that some Chinese firms were trying to dodge preexisting American tariffs on China by routing solar panels through other countries. The exact tariff rate depends on the company but could be more than 250 percent.The Chinese firms had set up factories in Southeast Asia, but Commerce Department officials said that some were not doing substantial manufacturing there. Rather, they were using sites in those countries to make minor changes to Chinese-made solar products, and then shipping them to the United States tariff-free, the ruling decided.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Europe Has Fallen Behind the U.S. and China. Can It Catch Up?

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    A “competitiveness crisis” is raising alarms for officials and business leaders in the European Union, where investment, income and productivity are lagging.Europe’s share of the global economy is shrinking, and fears are deepening that the continent can no longer keep up with the United States and China.“We are too small,” said Enrico Letta, a former Italian prime minister who recently delivered a report on the future of the single market to the European Union.“We are not very ambitious,” Nicolai Tangen, head of Norway’s sovereign wealth fund, the world’s largest, told The Financial Times. “Americans just work harder.”“European businesses need to regain self-confidence,” Europe’s association of chambers of commerce declared.The list of reasons for what has been called the “competitiveness crisis” goes on: The European Union has too many regulations, and its leadership in Brussels has too little power. Financial markets are too fragmented; public and private investments are too low; companies are too small to compete on a global scale.“Our organization, decision-making and financing are designed for ‘the world of yesterday’ — pre-Covid, pre-Ukraine, pre-conflagration in the Middle East, pre-return of great power rivalry,” said Mario Draghi, a former president of the European Central Bank who is heading a study of Europe’s competitiveness.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More