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There is no shortage of colorful language (and memes!) being used today to describe the new Trump Tax we're all about to pay -- after having been "liberated" from, y'know, paying less money for stuff. I chose the term financial pundit Ross Gerber used to describe it for the headline, as it seemed the most descriptive:
So... is everyone ready to pay more for everything? Because that's why America elected Donald Trump president, right?
On Wednesday, Trump will be announcing sweeping tariffs on the entire rest of the world. As he likes to put it, "tariff" is his new favorite word in the dictionary. But consumers are likely to call it what it will actually be, to them: a tax. A big fat "Trump Tax" on all sorts of things consumers buy. Which will likely drive up inflation, and which will definitely hit consumers hard in the pocketbook.
In keeping with the "world turned upside-down" nature of this week, we are going to start with a few things that haven't been front-and-center, then we'll circle in to a bigger-picture take, and finally we'll fit in the big story of the week at the end.
Happy St. Patrick's Day to all!
First, let's just quickly check the weather report from the Emerald Isle, shall we?
(Heh.)
But surprisingly enough, the country that caught my eye this particular Paddy's Day wasn't Ye Ould Sod, but instead our neighbor to the north. And it wasn't the fine stout product from Sir Arthur Guinness that intrigued my beer-loving sensibilities this year, but instead... Moosehead?
That's right. Moosehead beer (lager, actually, if you want to be pedantic). From Canada.
As is now the new normal, there were so many things happening in the political world this week it is hard to keep track of them all. But what is currently in the center ring is the vote happening in the Senate on the continuing resolution to fund the government for the rest of this fiscal year.
While the biggest political spectacle of the week was the president's big speech to Congress, the biggest political news of the week was actually the American economy reacting to Donald Trump's on-again-off-again, now-you-see-them-now-you-don't tariffs. The whiplash began at the start of the week and hasn't fully subsided yet. Taken together with all of Trump's other disruptive wrecking balls, economists are now starting to talk about the possibility of an upcoming "Trump recession."
Is America headed for a "Trump recession" already? Economists are starting to get worried. So are consumers. And the stock market has been in a deep dive ever since the tariff threat became real this week. So the possibility now exists -- we could be headed for an economic trainwreck. And if it happens, there will be a big difference from normal business-cycle recessions, because this time the reason why it happened will be pretty obvious to everyone.
I have to begin this review with the mandatory bit of pedantry which is required every four years. Last night, President Donald Trump gave a speech to a joint session of Congress. However, it was not technically a "State Of The Union" speech, since tradition dictates you have to have been in office for a whole year before giving one of those.
Nitpickery aside, let's do a quick review of how things went last night, shall we?
It is time for Democrats to step up to the plate. President Donald Trump will address Congress and the nation tonight, and will doubtlessly boast about all the wonderful things he thinks he has been doing. In doing so, he will also doubtlessly lie about many of them in shameless fashion, since that's what he always does. But Democrats need to not get distracted and remain focused on one thing above all else. Call it a return to: "It's the economy, stupid."
So is everyone ready to pay more for stuff? Because that certainly seems like what is next on the agenda for the American consumer. We'll be paying more for food in the grocery store, more for electronic goods, and a whole bunch more for cars, starting tomorrow.
Or maybe not. You never know what's going to happen, since American trade policy will now be decided on a whim. By a man who simply does not understand how world trade works. Isn't that a comforting thought?