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Is Trump Crazy?
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Some say Trump is crazy, but he’s not. His aim is twofold: bringing manufacturing back to the US and reversing the trade deficit. However, can tariffs really bring back manufacturing?
From my understanding, it’s impossible—especially considering the complexities of global supply chains. Even if companies like Apple, Nike, and Tesla were to relocate their production lines back to the US tomorrow, the process would take years. From choosing factory sites to worker recruitment, design, and building the entire industrial ecosystem, it’s a massive task. Not to mention that rebuilding manufacturing in the US would require trillions of dollars in investment, and this contradicts the US dollar’s dominance in the global market. That fundamental issue is unsolvable.
From my understanding, it’s impossible—especially considering the complexities of global supply chains. Even if companies like Apple, Nike, and Tesla were to relocate their production lines back to the US tomorrow, the process would take years. From choosing factory sites to worker recruitment, design, and building the entire industrial ecosystem, it’s a massive task. Not to mention that rebuilding manufacturing in the US would require trillions of dollars in investment, and this contradicts the US dollar’s dominance in the global market. That fundamental issue is unsolvable.
If tariffs were truly effective in bringing manufacturing back, they would need to be raised by 1,000%. But the US doesn’t have the local enterprises to absorb the impact. High labor costs make it difficult for the US to compete with low-cost producers overseas. Even if tariffs raise prices, consumers will continue to vote with their feet.
Ultimately, Trump’s desire for a trade surplus contradicts the global role of the US dollar, which relies on trade deficits to maintain liquidity in global markets. This contradiction leads to the Triffin paradox: the US needs a trade deficit to ensure the dollar remains the world’s reserve currency, and yet, a trade surplus would undermine that system.
In conclusion, the US doesn’t genuinely want to eliminate its trade deficit, as doing so would destabilize its global economic position. If the US really achieved a trade balance, it would lose its hegemonic status, and the Federal Reserve would no longer be the world’s central bank. That would be shooting itself in the foot.
Ultimately, Trump’s desire for a trade surplus contradicts the global role of the US dollar, which relies on trade deficits to maintain liquidity in global markets. This contradiction leads to the Triffin paradox: the US needs a trade deficit to ensure the dollar remains the world’s reserve currency, and yet, a trade surplus would undermine that system.
In conclusion, the US doesn’t genuinely want to eliminate its trade deficit, as doing so would destabilize its global economic position. If the US really achieved a trade balance, it would lose its hegemonic status, and the Federal Reserve would no longer be the world’s central bank. That would be shooting itself in the foot.
What is the true purpose behind Trump’s so-called “reciprocal tariffs”?
Tariffs are just a superficial rule. The deeper issue is hegemonic control and financial warfare. Domestically, Trump is framing the trade deficit as the result of unfair competition from other countries, appealing to voters in America’s industrial heartland.
This isn’t the first time a US president has used tariffs to win votes. In doing so, they break the existing international order and aim to rebuild a global system where the US holds ultimate dominance over capital and industry. The key here is managing expectations, which will eventually play out at the negotiation table.
We can see that Vietnam has already made concessions, which is understandable considering that US exports represent 30% of Vietnam’s GDP. The economic toll of retaliating against US tariffs is far too great, especially since its industries are heavily reliant on Chinese raw materials. As a result, Vietnam’s temporary strategy might make it a permanent “foundry” for the US.
This situation shows that in a hegemonic trade system, even small countries like Vietnam cannot avoid being exploited, even if they kneel before the US. Only regional coordination and technological innovation can provide a real defense.
Looking ahead, the EU, Japan, South Korea, Canada, and ASEAN will be crucial players. The EU has already signaled its intention to retaliate. Japan, South Korea, and ASEAN, however, are more moderate and seem hesitant to confront the US directly. Over time, most countries will likely follow Vietnam’s lead and submit to the US, with only a few standing firm.
This isn’t the first time a US president has used tariffs to win votes. In doing so, they break the existing international order and aim to rebuild a global system where the US holds ultimate dominance over capital and industry. The key here is managing expectations, which will eventually play out at the negotiation table.
We can see that Vietnam has already made concessions, which is understandable considering that US exports represent 30% of Vietnam’s GDP. The economic toll of retaliating against US tariffs is far too great, especially since its industries are heavily reliant on Chinese raw materials. As a result, Vietnam’s temporary strategy might make it a permanent “foundry” for the US.
This situation shows that in a hegemonic trade system, even small countries like Vietnam cannot avoid being exploited, even if they kneel before the US. Only regional coordination and technological innovation can provide a real defense.
Looking ahead, the EU, Japan, South Korea, Canada, and ASEAN will be crucial players. The EU has already signaled its intention to retaliate. Japan, South Korea, and ASEAN, however, are more moderate and seem hesitant to confront the US directly. Over time, most countries will likely follow Vietnam’s lead and submit to the US, with only a few standing firm.
According to the US government, more than 50 countries have reached out to the White House for negotiations, which seems to be exactly what the Trump administration desires. In the end, the negotiations will likely lead to zero tariffs or a mutually acceptable tariff rate, forming a new global trade pattern.
The real question is: in this new global system, China’s relationship with the remaining major trading partners will likely worsen. As Chinese products can no longer be sold to the US, competition will intensify with other countries. Trump’s strategy, therefore, isn’t just about seeking trade balance. It’s about systematically decoupling China from the global industrial chain.
While many experts believe Trump’s tariff policies will ultimately fail, China’s response is already prepared for this kind of decoupling. The experience gained from the past eight years of trade conflict has equipped China with the tools needed to manage the fallout. The People’s Daily is focused on domestic development, ensuring that even in the face of such volatility, China will not falter.
The real question is: in this new global system, China’s relationship with the remaining major trading partners will likely worsen. As Chinese products can no longer be sold to the US, competition will intensify with other countries. Trump’s strategy, therefore, isn’t just about seeking trade balance. It’s about systematically decoupling China from the global industrial chain.
While many experts believe Trump’s tariff policies will ultimately fail, China’s response is already prepared for this kind of decoupling. The experience gained from the past eight years of trade conflict has equipped China with the tools needed to manage the fallout. The People’s Daily is focused on domestic development, ensuring that even in the face of such volatility, China will not falter.
China’s reliance on exports to the US is relatively limited. Even if the US tariffs cause some job losses and disruption in certain industries, China’s resilience and focus on self-sufficiency will mitigate the impact.
In the long run, this may force China to adjust its economic structure, shifting its focus away from export dependency toward bolstering domestic demand. This could be achieved through fiscal policies that stimulate consumer spending, such as subsidies for home appliances and furniture, and domestic production of agricultural goods.
To wrap up, history shows that tariff wars usually end up emptying the wallets of ordinary people. So, in this no-win game, it’s essential for people to protect their families through smart consumption and increasing
In the long run, this may force China to adjust its economic structure, shifting its focus away from export dependency toward bolstering domestic demand. This could be achieved through fiscal policies that stimulate consumer spending, such as subsidies for home appliances and furniture, and domestic production of agricultural goods.
To wrap up, history shows that tariff wars usually end up emptying the wallets of ordinary people. So, in this no-win game, it’s essential for people to protect their families through smart consumption and increasing
