'America First' policy hurts businesses, consumers

Xinhua
China has no alternative but to respond to Trump's onslaught. China is doing the right thing, not just for himself, but also for the rest of the world's countries...
Xinhua

US President Donald Trump’s “America First” policy of protecting domestic interests will end up harming both American companies and consumers, according to Argentinean political observer Patricio Giusto.

The public policy analyst and university professor discussed with Xinhua recently about the White House shake-up of international trade and how it is bound to do more harm than good, especially to the world economy.

“The Trump administration has taken a surprising turn in trade policy, seeking to unleash an absurd (trade) war with China, in opposition to the globalized world,” said Giusto.

Escalating sanctions and retaliatory measures “are going to end up doing a lot of damage to the stability of the global economic system,” he added.

Trump does not appear to have a clear grasp of the consequences of his actions, said Giusto, who heads the Political Diagnosis consulting group.

“What Trump doesn’t understand is that these measures will, above all, end up impacting US companies and consumers, leaving his country increasingly more isolated from international consensus,” said the analyst.

“In that sense, Trump is unleashing other ridiculous mini-wars domestically by, for example, accusing online sales giant Amazon of making a profit at the expense of the US post,” said Giusto.

Among the protectionist measures the Trump administration has taken are steep tariffs of 25 percent on steel imports and 10 percent on aluminum imports that are expected to dent global trade and as a result slow global economic growth.

Trump also called for tariffs on some US$50 billion in Chinese imports, and restrictions on Chinese investment in the United States. China responded with a proposal to impose an additional 25 percent tariff on some US$50 billion US imports, including soybeans, automobiles and chemicals.

“China definitely seems to be the target of the White House’s protectionist policies,” said Giusto.

“China has no alternative but to respond to Trump’s onslaught. China is doing the right thing, not just for himself, but also for the rest of the world’s countries that have chosen the path of deepening globalization and free trade,” he added.

Departure from free trade

Raising tariffs and placing obstacles to trade “is not the way to resolve the differences with China. That way, you just increase tensions and problems for the US economy,” said Giusto.

Trump’s “protectionist turn is a departure from his predecessors’ policies in favor of free trade. You could say that Trump is conducting an anti-American policy, keeping in mind the pro-market history and tradition of the United States,” noted the analyst.

Unlike former US presidents, “Trump is alone, with his back to the world. Protectionism is an approach that has fallen into disuse globally, after having attested the counterproductive effects that these types of policies have on the domestic economy of those who practice it,” Giusto said.

The White House is betting on the strength of the US economy to pressure small- and medium-sized countries into making concessions, but without any long-term vision.

“It’s a combative strategy that runs counter to the rules of international trade that the United States itself promoted, a paradox that is tough to explain,” he said.

“The damage to the international order is very great, since the United States is the leading global power. It heightens uncertainty and mistrust in the multilateral sphere,” warned the analyst.

“Trump has destroyed the paradigms of international trade negotiation. Now the partners of the US don’t know when there might be new trade sanctions, increasing their uncertainty and dependence on the United States,” said the analyst.

“It is exactly the opposite model to the one China is proposing based on expanding free trade, international cooperation and seeking a win-win relationship,” said Giusto.

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