Reciprocal tariffs: A bad business deal for the US?
06/04/2025
Juan Carlos Palacios Cívico
|
Professor at the Faculty of Economics and Business
Juan Carlos Palacios Cívico
Professor at the Faculty of Economics and Business
On 2 April 2025, “Liberation Day” was represented at the White House gardens. Donald Trump appeared announcing tariffs (reciprocal and universal) that will tax “all unfair partners” who, in his words, for decades caused the gigantic US trade deficit and “stole countless American jobs” (6.6 million, according to his calculations).
At almost the same time, the Executive Office of the President released the mathematical formula by which the reciprocal tariffs had been calculated.
Judging by the downward reaction of the markets and the astonishment of some analysts, the list of affected countries and the amount of tariffs has gone beyond what was initially expected. Among those affected are small uninhabited territories or islands inhabited by penguins and seals. And exports from poor and underdeveloped countries, such as Lesotho, Iraq, Bangladesh and Madagascar, are among those most affected by the new tariffs.
Beyond the anecdotal or surprising, the main problem with the list presented by Trump is not only that it will most likely fail in its stated goal of ending the US trade deficit, but that, if implemented, it would have serious consequences for the US economy.
This article was originally published in The Conversation.
Judging by the downward reaction of the markets and the astonishment of some analysts, the list of affected countries and the amount of tariffs has gone beyond what was initially expected. Among those affected are small uninhabited territories or islands inhabited by penguins and seals. And exports from poor and underdeveloped countries, such as Lesotho, Iraq, Bangladesh and Madagascar, are among those most affected by the new tariffs.
Beyond the anecdotal or surprising, the main problem with the list presented by Trump is not only that it will most likely fail in its stated goal of ending the US trade deficit, but that, if implemented, it would have serious consequences for the US economy.
This article was originally published in The Conversation.