Tariffs increase the price of domestic US, reduce consumer purchasing capabilities, and increase the investment cost of merchants.(AFP)
Trump said that a trade war with China should have happened long and insisted that the United States has not faced economic recession.However, the latest research on the Congress Budget Office found that the trade war will reduce the economic growth rate of the United States by 0.3 percentage points next year; the budget deficit of the federal government will also be expanded to more than $ 1 trillion.
(Washington Comprehensive) U.S. President Trump said that the trade war with China should have happened long ago, and he was the candidate, so he decided to face it and is winning the war.
However, the latest research by the US Congress Budget Office (CBO) found that Trump will launch a trade war will lead to a decrease in US economic growth by 0.3 percentage points next year;expand.
Trump told reporters in the White House on Wednesday that he would be easier if he did not launch a trade war in China, but he defended his actions and firmly believed that the two sides could still reach a trade agreement.
He said: Some people say that this is Trump's trade war, which is not my trade war.This trade war should have happened long ago, and many other president should have done so long.
Trump also said: Someone must do it.I am the candidate hellip; hellip; so I am dealing with China, and I am dealing with China in terms of trade.And do you know, we are winning.
Trump looked up at the sky when he said the word the chosen one.The word has the origin of religious, and both Jesus and Muhammad are described as candidates.
Trump also acknowledged the next day that a trade war with China could harm the US economy, but he insisted that the United States did not face economic recession.
As for him on Tuesday, he said that considering reducing capital gains and wage taxes to boost the economy, Trump changed his position on Wednesday, indicating that he would not consider any form of tax cutting because the US economy was very strong.
However, the cross -party budget office became the latest independent organization that warned the consequences of warning trade on Wednesday.Studies in the office found that the changes in the US and foreign trade policies since January 2018 will lead to a decrease of 0.3 percentage points in GDP (GDP), which has been adjusted by the inflation rate in 2020.
Tariffs make domestic domestic prices improve
The office said that tariffs increased domestic prices in the United States, reduced consumer purchasing capabilities, and increased the investment cost of merchants.The average actual income of the US families in 2020 will also be reduced by 0.4%.
The report of the Congress Budget Office also predicts that the budget deficit of the federal government will be expanded to more than $ 1 trillion (about 1.38 trillion yuan) in fiscal 2020.This is two years in advance than previously expected, and since 2012, the deficit has exceeded the $ 1 trillion mark for the first time.
According to the prediction of the office in January this year, the deficit in fiscal 2020 should only be US $ 890 billion, and it will not exceed $ 1 trillion until 2022.
The acceleration of deficit is expanding because the government has increased spending through legislation.However, because interest rates are expected to be reduced, it is believed that the government's debt repayment burden will be reduced.
With the coming of the presidential election in 2020, the federal government deficit expansion may prevent Trump from providing ammunition for Democrats for re -election.The fiscal hawks also believe that the increasingly expanding deficit limits the ability of the federal government to launch economic measures to revitalize economic measures when economic recession.
The report of the budget office also refuted the White House economic adviser, Kudlo, that the government deficit is decreasing and is rapidly decreasing.Kudlo delivered the above speech a year ago, and he always insisted on this view.He also said last month that the deficit is quite easy to manage and is not a big problem.
If the deficit is measured according to economic performance, his statement may make sense.Because according to the data of the Congress Budget Office, the deficit will only be equivalent to 4.6 % of the GDP, and it will remain below 5 % until 2026.This is about half of the level of the financial crisis 10 years ago.
The bigger problem is that government debt is expected to rise from 81 % of GDP this year to 95 % in 2029.
The budget office also predicts that the US economy will increase by 2.3%in the fourth quarter of this year, an increase of 2.1%next year, higher than 1.7%of the previous forecast.Until 2029, the growth rate will slow to approximately 1.8%.
