RE: New report: Trump's reckless trade policies would cost families $2,200/year

From:BrinsterJ@dnc.org To: WalkerE@dnc.org, RR2@dnc.org Date: 2016-05-19 13:20 Subject: RE: New report: Trump's reckless trade policies would cost families $2,200/year

Sorry, taking this to RR2. Right, that's why I'm not saying we should necessarily stop ourselves from blasting it. But it is hitting Donald Trump for a policy position that's only a bit more extreme than one of Bernie's core positions. Story doesn't mention Bernie... We have some exposure with Bernie Sanders and tariffs. Sanders wants to reverse trade agreements and scrap the TPP, and all those trade agreements are aimed at significantly lowering tariffs. He occasionally gets lumped in with Trump for having "delusional" or "reckless" trade policies. I don't know if that's enough to nix it, but wanted to flag. US News<http://www.usnews.com/opinion/economic-intelligence/articles/2016-03-14/the-economic-danger-of-trumps-and-sanders-trade-proctectionism> explains it pretty well: "Trump is the most direct and vocal about it, calling for tariffs as high as 45 percent against China. Sanders has yet to call for a specific tariff, but he's called for repealing the North American Free Trade Agreement with Canada and Mexico. Eliminating NAFTA would restore tariffs that ranged up to 25 percent and lead to other measures that hinder trade between countries." h/t Sarge. Blastable. Subject line: New report: Trump's reckless trade policies would cost families $2,200/year Body: Makes sense, since Trump things wages are "too high" in the U.S. Trump's tariffs will cost Americans thousands, report says<http://money.cnn.com/2016/05/19/news/economy/trump-tariffs-cost/index.html> by Tami Luhby<http://money.cnn.com/author/tami-luhby/index.html> May 19, 2016: 7:59 AM ET Donald Trump's tough talk of imposing tariffs on China, Japan and Mexico gets big cheers at his rallies. What his supporters may not realize, however, is how much those tariffs will cost them. Trump has repeatedly said America has been on the losing end of trade deals for years. In his view, the tariffs<http://money.cnn.com/2016/05/18/news/us-steel-china-trade/index.html?iid=EL> would level the playing field by making imports more expensive. That, in turn, would prompt American companies to produce more domestically and bring back jobs. Experts, however, say boosting tariffs would be a bad deal for Americans, particularly for the poor. The tariffs would cost the average household $2,200 a year, or 4% of their after-tax income, according to a new study<http://nfap.com/wp-content/uploads/2016/05/Impact-of-the-Trump-Tariffs.NFAP-Policy-Brief.May-20161.pdf> from the non-profit National Foundation for American Policy conducted by David Tuerck, Paul Bachman and Frank Conte, all of Suffolk University. This is largely because imports under Trump's policy would become more expensive, sending the price of competing American-made goods higher as well. That would effectively levy a consumption tax on purchases and cut into the incomes of shoppers. "All of the benefits for producers would be extracted from consumers," said Tuerck, who heads the economics department at Suffolk. "It's using a blunt sword to do brain surgery. It would cost consumers an awful lot for rather small benefits for U.S. producers." The levy would fall even more heavily on the poor since they spend more on necessities and more of their purchases are low-cost imported goods, experts say. The tariffs would eat up 18%, or $934, of the annual income of those in the bottom 10% of households. But they would only dent the income of the richest decile by 3%, or $5,001, the researchers estimated. The Suffolk University study assumes Trump would levy a 45% tariff on goods and services from China and Japan and 35% on Mexican products. The presumptive Republican candidate has not laid out a specific trade policy, but has talked of implementing such tariffs. Trump's campaign did not return a request for comment. What's more, broad-based tariffs on imports from these countries could wind up hurting globally competitive American companies<http://money.cnn.com/2016/05/17/news/economy/manufacturing-jobs-america/index.html?iid=EL>, particularly ones in higher-skilled industries that pay better wages. If the U.S. cuts down on buying imports, foreign countries may have less money to buy U.S. exports or they may retaliate by imposing their own levies on U.S. goods, said Peter Petri, professor of international economics at Brandeis University. That will hurt makers of more advanced products, such as pharmaceuticals, computer chips and chemicals, while protecting lower-wage manufacturers, such as garment and toy companies. But even if the makers of these commodity products were to set up shop again in the U.S., they likely would be highly automated and not create many jobs. "It would increase jobs not done in America today because they pay too little, but decrease export-oriented jobs with higher wages," said Petri, noting that globally competitive exporters pay up to 18% more, on average, than those that don't export. "We'll put shackles on our most competitive industries." Eric Walker walkere@dnc.org<mailto:walkere@dnc.org> 732-991-1489 @ericmwalker<https://twitter.com/ericmwalker>