What You Must Know
- Trump has floated tariff hikes as a option to pay for some revenue tax cuts.
- His anti-immigration stance may squeeze the labor provide, and repealing Biden’s renewable power subsidies would push up energy prices, the previous Treasury secretary says.
- A Trump spokeswoman stated his insurance policies would cut back inflation.
Former Treasury Secretary Lawrence Summers blasted coverage concepts floated by former President Donald Trump as immensely damaging to each the U.S. and the worldwide financial system.
“This can be a prescription for the mom of all stagflations,” Summers stated on Bloomberg Tv’s Wall Road Week with David Westin Friday, with regard to changing a significant quantity of income-tax income with tariffs. It might additionally create “worldwide financial warfare,” he stated.
Summers was talking a day after Trump introduced the concept of utilizing tariff hikes as a option to pay for some revenue tax cuts in a gathering with Home Republicans. Trump has additionally proposed a minimal 10% common import levy and a punitive charge for China.
A shift to counting on tariffs for income would push up not simply the price of imports, however these of products and providers that compete with these imports, Summers stated. Shoppers would have much less to spend on all the pieces else, making a “downward spiral” within the financial system, he stated.
“I don’t suppose there’s been a extra inflationary presidential financial coverage platform in my lifetime,” stated Summers, a Harvard College professor and paid contributor to Bloomberg TV. “Maybe George McGovern in 1972 in some methods can be a comparability,” he stated, referring to the Democratic nominee who misplaced in that contest.
Marketing campaign Response
Requested about Summers’s criticisms, Karoline Leavitt, a Trump marketing campaign spokesperson, stated, “President Trump’s first-term pro-growth financial insurance policies created record-low mortgage, curiosity and unemployment charges and made inflation nearly non-existent.”
“Individuals can anticipate President Trump’s second-term financial agenda could have the identical impression and finish Joe Biden’s inflation disaster that continues to rob working households of 1000’s of {dollars} each month,” Leavitt stated.
