- Trump’s “Liberation Day” of tariffs for virtually every country around the world — except for Russia! — might well wreck both America’s, and the world’s, economy;
- With Paul Krugman’s expose of their “formula”;
- A reminder from Robert Reich, from 2018, about how Trump is dumb in virtually everything except for political conning;
- Daily Kos about that formula;
- I recall some comments from Facebook, about a new Canadian alliance and the idea of conservation, while the MAGA crowd is not conversing, they’re tearing everything down;
- And how Trump’s tariffs target uninhabited islands, and Lesotho.
The MAGA cultists and their elected idiot-in-chief are wrecking the nation, and maybe the world. Basically it boils down to: the world is changing, and conservative tribalists want to change it back, and will wreck the nation if they can’t. And they call it “Liberation Day.”
NY Times, 3 Apr 2025: Live Updates: Tariffs Send Wall Street Tumbling to Worst Day Since Pandemic
The S&P 500 fell almost 5 percent on Thursday, its worst drop since June 2020, as allies and adversaries alike criticized President Trump’s action and weighed their responses.
Currently pinned:
A new, sweeping round of tariffs sent a shock through Wall Street on Thursday, as upended economic forecasts and intensified worries about global growth sent stock markets tumbling to their worst day since the height of the coronavirus pandemic.
The S&P 500 fell almost 5 percent on Thursday, its worst showing since June 2020. Thursday’s decline came after the S&P 500 had already fallen for five of the last six weeks, amid intensifying economic concerns pressured by tariff talk. But the effects won’t be limited to the financial markets, experts said.
Thursday’s sell-off was an extraordinary moment in markets that, despite being prone to big swings, rarely suffer such a dramatic reaction to an American president’s rollout of an economic policy.
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Paul Krugman, 3 Apr 2025: Will Malignant Stupidity Kill the World Economy?, subtitled “Trump’s tariffs are a disaster. His policy process is worse.”
America created the modern world trading system. The rules governing tariffs and the negotiating process that brought those tariffs down over time grew out of the Reciprocal Trade Agreements Act, devised by FDR in 1934. The growth in international trade under that system had some negative aspects but was on balance very good for America and the world. It was, in fact, one of our greatest policy achievements.
Yesterday Donald Trump burned it all down.
…
You might be tempted to dismiss complaints about the policy process as elitist snobbery. But credibility is a crucial part of policymaking. Businesses can’t plan if they have no idea what to expect next. Foreign governments won’t make policies that help America if they don’t expect us to respond rationally.
So what do we know about how the Trumpists arrived at their tariff plan? Trump claimed that the tariff rates imposed on different countries reflected their policies, but James Surowiecki soon noted that the tariffs applied to each country appeared to be derived from a crude formula based on the U.S. trade deficit with that country. Trump officials denied this, while at the same time the Office of the U.S. Trade Representative released a note confirming Surowiecki’s guess. Here’s their explanation:
Ignore the Greek letters, which cancel each other out. This says that the assumed level of a country’s protectionism is equal to its trade surplus with America divided by its exports to America.
Trump also set minimum tariffs of 10 percent on everyone, which means among other things imposing tariffs on uninhabited islands.
There’s so much wrong with this approach that it’s hard to know where to start. But one easy thing to point out is that the Trump calculation only considers trade in goods, while ignoring trade in services. This is a big omission.
And so on. Trump is extremely simple-minded. In fact, it might be worth revisiting this 2018 post by Robert Reich, which has been floating around on Facebook today.
Salon, Robert Reich, 9 Jan 2018: Robert Reich: Seriously, how dumb is Trump?, subtitled “His staffers think he’s an idiot. But at least in one area, he’s a genius”
Political conning is Trump’s genius. This genius — combined with his utter stupidity in every other dimension of his being — poses a clear and present danger to America and the world.
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More about the formula.
Daily Kos, 3 Apr 2025: The dumb insidious formula for trump’s “reciprocal” tariffs
The reciprocal tariff rate is simply half the trade deficit divided by the total imports from the country, rounded up, with a minimum of 10%. It has no relationship with the actual tariff rates charged by the country on U.S. goods.
Reciprocal tariff rate = max(trade_deficit / imports * 50%, 10%)
E.g., for Vietnam: $123.5b trade deficit, $136.6b imports by U.S.; reciprocal tariff = 123.5 / 136.6 / 2 = 46%.
A few countries are exempt from tariffs, notably Russia, Belarus and N. Korea.
Note that Russia is exempt from tariffs! (Because Trump so wants to be like dictator Putin.)
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Meanwhile, I saw an item on Facebook about how the new Canadian president is setting up a trade alliance with European nations that will exclude the US. I’ll find a link tomorrow.
And another comment on Facebook, about how conservatives supposedly want to conserve things. These people in charge of the current government are not conserving things, they are tearing things down. How far does this go before even the cultists rebel?
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Several sources have noted the incoherency of this tariff plan, established in typical Trump form without much thought.
The Guardian, 2 Apr 2025 (via JMG): ‘Nowhere on Earth is safe’: Trump imposes tariffs on uninhabited islands near Antarctica
And
NBC News, 3 Apr 2025: Trump’s highest tariff will kill tiny African kingdom of Lesotho, economist says, subtitled “Ridiculed for imposing trade tariffs on frozen islands largely inhabited by penguins, Trump’s formula for calculating levies has a serious side: it is also hitting some of the world’s poorest nations hardest.”
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Trump is a James Bond villain. Well, no; James Bond villains were smart.
