Trump has delayed his monster tariffs. Here’s why you should care

Floydnig

Job losses
But what about the impact of tariffs on job creation? Surprisingly, an increase in import taxes has been found to result in slightly more unemployment across countries.
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An example provided by Irwin at Dartmouth College points to one plausible explanation — and it has to do with the steeper cost of imported goods.

“A number of studies have shown, on net, we lost jobs from the (2018) steel tariffs rather than gained jobs because there are more people employed in the downstream user industries than in the steel industry itself,” he said.
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A study by the Federal Reserve Board found that a rise in input costs resulting from US tariff hikes in 2018-19 led to job losses in American manufacturing. The damage from those higher expenses was compounded by retaliatory taxes on US exports, more than offsetting a small boost to manufacturing employment from US tariffs — at least so far, the 2024 paper said.

Retaliation by other countries is indeed another danger of pulling the tariff lever. Higher tariffs on American exports would typically raise their prices for foreign consumers, hitting demand for the goods in many cases.

When Trump announced new tariffs this year, America’s major trading partners were quick to strike back with their own levies, although the US then agreed a temporary truce with China and the European Union.

Costs of free trade
While economists generally agree that free trade has benefited the global economy in recent decades, they acknowledge that it comes with certain costs.

One is the loss of jobs in communities that are particularly exposed to new competition from foreign manufacturers.

That is similar to the impact of technological progress on workers. “Manufacturing jobs as a share of the labor force have come down everywhere. It isn’t a US-specific story,” said Gimber at JPMorgan Asset Management, pointing to automation.

He drew a parallel between helping workers affected by higher imports and what is known as a just transition — the idea that the drastic changes needed to move toward a greener economy should be fair to everyone and minimize harm to workers and communities.

In both cases, providing workers in impacted industries with new skills or retraining them could be key, Gimber said.

Another potential cost of free trade is dependency on far-flung manufacturers. That took on new relevance during the pandemic, which snarled global supply chains, contributing to shortages of products such as face masks and respirators in the US and elsewhere.

However, economists do not typically see tariffs as a good way to build up domestic manufacturing, Fatas at INSEAD said, noting that subsidies for specific industries are viewed as a better tool “because they work more directly.”

But perhaps the strongest argument in favor of free trade is its importance to maintaining peace between nations.

As Gimber’s colleague David Kelly noted in March, closer trade relations give countries more to lose in any conflict.

Michaelwaf

It’s no secret how President Donald Trump feels about sports teams turning away from Native American mascots. He’s repeatedly called for the return of the Washington Redskins and Cleveland Indians, claiming their recent rebrands were part of a “woke” agenda designed to erase history.
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But one surprising team has really gotten the president’s attention: the Massapequa Chiefs.

The Long Island school district has refused to change its logo and name under a mandate from New York state banning schools from using team mascots appropriating Indigenous culture. Schools were given two years to rebrand, but Massapequa is the lone holdout, having missed the June 30 deadline to debut a new logo.
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The district lost an initial lawsuit it filed against the state but now has the federal government on its side. In May, Trump’s Department of Education intervened on the district’s behalf, claiming the state’s mascot ban is itself discriminatory.

Massapequa’s Chiefs logo — an American Indian wearing a yellow feathered headdress — is expected to still be prominently displayed when the fall sports season kicks off soon, putting the quiet Long Island hamlet at the center of a political firestorm.
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The district is now a key “battleground,” said Oliver Roberts, a Massapequa alum and the lawyer representing the school board in its fresh lawsuit against New York claiming that the ban is unconstitutional and discriminatory.

The Trump administration claims New York’s mascot ban violates Title VI of the Civil Rights Act of 1964, which prohibits recipients of federal funds from engaging in discriminatory behavior based on race, color or national origin — teeing up a potentially precedent-setting fight.

The intervention on behalf of Massapequa follows a pattern for a White House that has aggressively applied civil rights protections to police “reverse discrimination” and coerced schools and universities into policy concessions by withholding federal funds.

“Our goal is to assist nationally,” Roberts said. “It’s us putting forward our time and effort to try and assist with this national movement and push back against the woke bureaucrats trying to cancel our country’s history and tradition.”
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