Lone Candle
Champion of Truth
“Trump’s all-sticks-and-no-carrot approach to trade talks is making it difficult for even friendly foreign governments to reach an agreement they fear could be political suicide back home — no matter how much the White House threatens their economies.”
https://www.politico.com/news/2025/06/29/us-india-trade-deal-00430438
Trump Is Slapping a 50 Percent Tariff on Home Appliances
https://reason.com/2025/06/16/trump-is-slapping-a-50-percent-tariff-on-home-appliances/
“China on Friday signaled it would approve the export of rare earth minerals to the US, hours after White House officials said the two sides had reached a deal, in what would be a major breakthrough following weeks of negotiations over US access to the key materials.”
https://www.yahoo.com/news/us-china-formalize-deal-rare-075006013.html
“Foreign manufacturers will have to lower their prices to accommodate tariff rates, Miran believes. If they don’t, then U.S. importers will turn to factories in other markets rather than absorbing the cost of tariffs themselves.
“We can move our demand across borders, but a factory can’t get up and move across borders,” he said.
You might say, his theory is that the customer is always right.
This line of thinking, a theme of his work since before he joined the administration, is an important way Miran’s reasoning diverges from that of most of his fellow economists. Critics point to examples — such as Trump’s tariffs on washing machines in his first term — where consumers seemed to be the ones who paid the price.
The question of who will bear the cost burden of import taxes is an important puzzle piece for gaming out how much inflation will rise and how much growth will slow. It is a particularly critical dilemma for the Federal Reserve, which is trying to decide when to ease off the decelerating economy.”
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“For this to work, foreign firms have to believe that, unless they capitulate, U.S. companies really will relocate their supply chains elsewhere, Miran told me. That’s one of the many tricky parts for proponents of Trump’s agenda — and Miran conceded as much.
“The truth is that for a lot of products, there’s not a credible alternative for a supply chain available instantaneously, right?” he said.
The recalibration, in other words, will take some time.
And that time could come at a price for the economy, as Trump’s shifting tariffs and fluid negotiations leave businesses hesitant to take action. If firms knew where tariffs would land, they could make investment decisions — on where to build factories, on what size workforce they need, on whether they need to change their business model. In the meantime, many executives are frozen in place, a paralysis that itself could take a bite out of growth.
Right now, manufacturers have been scaling back production as new orders dry up, and confidence in business conditions among CEOs collapsed during the second quarter at its fastest pace in roughly half a century.
Miran was straightforward about acknowledging that policy uncertainty is a challenge, repeatedly suggesting that there could be volatility — in growth, in prices — ahead.”
https://www.politico.com/news/2025/06/18/trump-economist-stephen-miran-trade-war-00410450
“Trump unilaterally imposed tariffs on much of the world. Yet the president has no such authority under Article II of the Constitution, which enumerates the limited powers of the executive branch. Instead, the authority “to lay and collect Taxes, Duties, Imposts and Excises,” as well as the authority “to regulate Commerce with Foreign nations,” resides exclusively in Article I, which is where the limited powers of the legislative branch are detailed.
So, Trump’s trade war violates the constitutional separation of powers because Trump has unlawfully exercised power that the Constitution placed in the hands of Congress, not in the hands of the president.”
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“As a pretext for his trade war, Trump invoked the International Emergency Economic Powers Act (IEEPA). Yet “the statute is silent on tariffs, and for good reason. It was never meant, and has never been understood, to authorize the President to impose them.” That observation comes from a superb friend of the court brief filed by a cross-ideological group of legal scholars and former government officials in support of the legal challenge against Trump’s tariffs. Their brief thoroughly explains why Trump’s use of the IEEPA to fundamentally remake the American economy cannot be reconciled with any law passed by Congress. In short, Trump’s tariffs flunk the test imposed by the major questions doctrine.”
https://reason.com/2025/06/05/overruling-trumps-tariffs-should-be-an-easy-decision-for-scotus/
“By examining alternative studies and methodological adjustments, Winship contends that the negative effects of trade with China have been significantly exaggerated and that populist narratives blaming this trade for U.S. economic decline aren’t supported by rigorous evidence.
The originators of the China shock theory examined how Chinese imports affected certain U.S. locales compared with others—not with the entire country—based on initial industry composition and employment size. By these metrics, areas heavily exposed to Chinese imports showed disproportionately worse manufacturing job losses.
However, Winship points out that even if we accept these estimates, the findings suggest only relatively modest employment effects.
To put things in perspective, Winship gives the example of two hypothetical commuting zones with 200,000 working-age residents and 20,000 manufacturing workers. Data from the theory’s proponents indicate that moving from low (10th percentile) to high (90th percentile) exposure to Chinese imports would result in a loss of roughly 2,700 manufacturing jobs—just a 1.4-percentage-point drop in overall manufacturing employment.”
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“In addition, Winship flags multiple methodological issues. Once other economists revised the proponents’ methods, the estimated negative impact shrank dramatically. Various followup studies found the China shock effect on manufacturing employment to be 50 percent smaller than initially claimed.
Further research revealed that job losses in exposed areas were often offset or even outweighed by employment gains in other sectors. One detailed Census Bureau study even found that firms with greater Chinese import exposure increased manufacturing employment, reallocating jobs to more efficient domestic production lines enabled by cheaper imports.
Moreover, the steady decline in U.S. manufacturing employment began decades before China’s WTO entry. Between the late 1970s and 2000, factory employment had already decreased substantially, mostly because of technological advances and shifting consumer demand.
Notably, there was no sudden acceleration of this decline after China joined the WTO. The rate of manufacturing job losses remained consistent with earlier trends, undermining claims that Chinese trade uniquely devastated American manufacturing.
Furthermore, former manufacturing workers generally did not face permanent unemployment. In fact, unemployment rates among this group were lower in recent years compared to the late 1990s, before the peak of Chinese imports. Many workers transitioned successfully into other sectors, belying the notion of an enduring displacement crisis. It’s also worth noting that there are around half a million unfilled manufacturing jobs today.”
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” evidence from Trump’s first term showed that his tariffs often hurt American firms more than their foreign competitors. With broader and higher tariffs, we can only fear the worst.”
https://reason.com/2025/06/05/no-trade-with-china-did-not-kill-the-u-s-economy/
Trump’s Trade War in Limbo | Raging Moderates
https://www.youtube.com/watch?v=9CvkLnVMexU
“Burns noted it’s important to counter Beijing’s increasingly aggressive economic, diplomatic and military global footprint — but warned that Trump is going about it all wrong, particularly by using tariffs as a cudgel against longtime partners who otherwise might have allied with the U.S. against China.”
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“The fact that we’ve had trouble convincing the Chinese it’s in our interest to have our senior military leaders talking. My nightmare scenario as ambassador was not an intentional conflict, but an accident.”
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” I think the fundamental mistake that was made was that when we imposed tariffs on China, we also imposed high tariffs on South Korea, Japan, the European Union, Canada and Mexico. All those countries are on our side in the big issues that separate us from China. All of them have the same economic issues and trade problems with China. If we had highlighted China as the major disruptor of global trade, which China has been for the last couple of decades, and formed a coalition with the EU and Japan and the U.S. — that’s 60 percent of global GDP — we would have had leverage for these negotiations.”
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“The Chinese have been saying every day for the last several weeks that the United States is being unfair, that we’re a bully, that we’re disrupting global trade. In fact, they’re the biggest problem in global trade. Intellectual property theft against American and other nations’ companies; forced technology transfer; dumping of EVs, lithium batteries, solar panels on the rest of the world below the cost of production; disrupting global markets; trying to kill the manufacturing industries in places like the United States and Europe.”
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“I think what the American people need to understand — our government and both parties — is that China is a worthy competitor. Their science and technology talent is prodigious. The level of scholarship, of patents, of research in some areas exceeds us, or is equal to us. In some critical areas of technology transformation, they are putting massive amounts of state-directed money into their national champions like Huawei, with companies that they want to succeed in the world. They’re doing it on a consistent basis, and they plan over decades, so they have that advantage.
When I was leaving in January, the Chinese announced $15 billion of state money going into quantum computing alone. They want to beat us to the punch there. That’s something that’s not as well understood in American society and even in our press — people have older, conventional views of China that are outdated.”
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“The destruction of USAID was a catastrophic mistake for the United States. That was our agency that said to the rest of the world, “We’ll help you on vaccines. We’ll help you with HIV. Will help you with polio.” Elon Musk and company destroyed USAID in one week and laid off 8,500 people. That helped China.
The Chinese then went out with a massive propaganda blitz the next day all over the world saying, “The United States is not interested in you any longer.” I watched the Chinese do this in February and March. The way the cuts were done, the fact that it was done with so little thought, so little information, and so little respect for our career civil servants was disgraceful.”
https://www.politico.com/news/magazine/2025/06/05/trump-china-trade-war-ambassador-interview-00386594
“Basically, the feds impose damaging new taxes and trade restrictions on farmers for reasons mostly related to ideology and rent-seeking, then undo their effects by making farmers more dependent on government largesse. Often lost in the discussion, but one reason that U.S. farmers are so dependent on selling commodity crops to China and elsewhere is that past policies essentially subsidized them to do so.
Like with all things political, various federal farm policies have created a series of odd bedfellows. Many environmental groups have lauded past farm bills because they provide incentives for farmers to set aside land as open space, but overall the federal meddling has harmed the environment. For instance, federal sugar subsidies have greatly diminished the Florida Everglades by encouraging the conversion of wetlands into sugar fields.”
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“All these policies drive up food prices for non-farmers and reduce our choices in meats and produce.”
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“Instead of creating this convoluted, counterproductive policy that mimics a Rube Goldberg farce, the government should do the basics to help farmers. It should scuttle tariffs, halt subsidies, eliminate costly shipping levies, create a guest-worker program so farmers can have a consistent labor source, lower taxes, bolster water infrastructure and let markets do the rest.”
https://reason.com/2025/05/23/farmers-need-free-markets-not-tariffs-and-welfare/
“President Donald Trump threatened on Friday morning to raise prices on iPhones sold in the United States, as he threatened to slap a 25 percent tariff on Apple smartphones that aren’t built in the United States.
“I have long ago informed Tim Cook of Apple that I expect their iPhone’s (sic) that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” Trump posted on Truth Social. “If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.”
In either outcome, consumers will have to pay more. A 25 percent tariff on iPhones built in other countries would, of course, artificially inflate prices. On the other hand, an American-made iPhone would likely be even more expensive: one estimate pegs the cost of an American-made iPhone at around $3,500.”
https://reason.com/2025/05/23/trump-declares-that-iphones-should-be-more-expensive/