What game is President Donald Trump playing on tariffs? That's what CEOs, investors, and all our trading partners have been trying to divine since this trade war erupted. Until a week or two ago, everyone from the 401(k) crowd to major money managers believed that the leader of the free world was mainly deploying the threat of sweeping tariffs not as a long-term policy, but as a cudgel to extract better terms from exporters.
Now it’s becoming increasingly clear that the president is determined to do exactly what they feared but didn’t really believe could happen: reverse decades of global free trade and build another “wall,” not the barrier along the Mexican border, but a protectionist barricade around America that repels even our closest allies and trading partners.
In a deep dive for Fortune, Shawn Tully examines the roots of Trump's fixation on tariffs and exposes how they threaten to derail the U.S. economy. As noted economist Steve Hanke of Johns Hopkins University puts it, “You can’t win a trade war. Starting one, as Trump is doing, only ensures that both sides lose.”
|
