The trade war has reached a new level. It all started when the US imposed anti-dumping taxes on various foreign goods for the relatively few interest groups’ benefit. Right now, the trade war includes a substantial amount of goods; from steel to textile, from apple to shrimp. And currently, the symbols of the ongoing trade war are the American Boeing and European Airbus.
The US is digging its own grave and unfortunately, it’s dragging the world with it. This trade war needs to stop sooner rather than later. The majority in the Congress need to realize that the well-being of the few is not as important at the well-being of the many. If this squabbling continues to head for the worst, things are going to look grim for both the producers and the consumers.
With greater trade restrictions, the market size for the producers will get smaller as prices artificially increase. Some of the local producers may benefit from this restriction however but consumers on the other hand will have limited choice due to the higher price. The price of foreign goods has already been forced upward by the weakening dollar.
Things look grim but one of the most watched economic indices, the University of Michigan’s consumer confidence indicates a slight increase. This might be caused by the current shopping season. I suspect in a couple of months, consumer confidence will fall due to trade war that is becoming more visible each day.
Somehow, I think the US is not the place to be in the near future, if one is concerned with its economic environment. Aside from all these, with the issue of social security essentially remains unsolved, the US is a ticking time bomb.
