Friday, May 26, 2017

What did Donald Trump do today?

He partially walked back remarks calling Germans "bad, very bad," but not the untrue example he gave of the badness of Germany.

In a meeting with European Union officials yesterday, Trump said that "the Germans are bad, very bad." The larger context of the remarks had to do with trade surpluses, so economic advisor Gary Cohn was dispatched to reassure allies that Trump "said they're very bad on trade but he doesn't have a problem with Germany."

However, Trump followed up the "very bad" remark by saying, "See the millions of cars they are selling in the U.S.? Terrible. We will stop this.”

Trump apparently didn't know he can't "stop" anything with Germany specifically, as EU member nations negotiate trade treaties as a bloc. But more to the point, most German cars sold in the United States are made in the United States--and US-made German cars are a significant portion of cars exported from the United States. Reducing those numbers would hurt American consumers by decreasing free market competition, and American workers in the predominantly Southern states where German factories are located.

Why should anyone care?

  • It's bad if a president can't express a view on something as important as international trade without being both insulting and factually wrong.
  • As a rule, presidents should not adopt trade positions that would both raise prices for American consumers and threaten American manufacturing jobs.