David Cay Johnston on Trump's Tariffs Backfiring and Internal Tensions

Trump's Tariffs and Economic Misunderstanding

• 💡 Donald Trump fundamentally misunderstands tariffs, believing they are paid by the exporting country, when in reality they raise domestic prices and extract money from the purchasing class.
• 💰 The purpose of tariffs, according to Johnston, is to allow domestic manufacturers to build financial muscle by raising prices on competing imported goods.
• 📉 Billions, or even trillions of dollars, have been wiped off the stock market, with warnings of a global recession, yet Trump continues with his tariff policies.

Geopolitical Repercussions and China's Rise

• 🌏 China is supplanting the US as the number one trading partner for many countries, acting in its own best interests due to its leadership's deep understanding of these matters.
• 🤝 There's a concern that countries like the EU, UK, Canada, Japan, South Korea, Australia, New Zealand, India, and China could form a free trading zone, effectively cutting the US out and causing awful geopolitical and economic consequences.
• 🇨🇳 China is retaliating with significant tariffs against the US, calling the US actions blackmail, while the White House suggests China will seek a deal.

Trump's Ego and Internal Coalition Tensions

• 🧠 Donald Trump operates with an incredible ego, believing he is special and others are idiots, wanting people to