The Wall Street Journal reported this weekend that far from the dire consequences predicted, the U.S. economy “sailed through two turbulent years of trade war with China with barely a scratch.”
The Wall Street Journal: Farmers took a big hit. Importers of auto parts, furniture and machinery choked down punishing tariffs. Investment between the world’s two largest economies dropped.
Much of the U.S. economy is largely unscathed by two turbulent years of trade war with China, economic indicators show.
The biggest hit to the U.S. economy was a decline in agricultural exports to China. But this was largely ameliorated by the Trump administration’s decision to divert $28 billion of income from tariffs to U.S. farmers.
Perhaps most notably, tariffs did not cause prices to rise. According to the Journal, a basket of goods covered by U.S. tariffs showed prices rising 3 percent. But these were offset by prices falling on other goods. Inflation overall was near or below the Fed’s target of 2 percent, indicating that the trade war did not hurt U.S. consumers. – READ MORE