Declaring trade war with entire world will have massive consequences in medium to long term for us. These countries are not stupid. They will figure out how to counter. By that time it will be out of our control.
Remember, we invented the current world free trade system. Consequences of undoing it is beyond the comprehension of our government. I mean did we need put tariff on vanilla or bananas?
So no, I don't sit here whistling Dixie thinking it is just a minor issue. It is the most dramatic action we could take in world order.
Amir,
Your POV assumes these countries have the leverage and ability to counter in the long term. (Some absolutely do, some not so much) But likewise, we can cause equal pain in all instances. The point is that it’s not a one sided equation of which the outcomes are a forgone conclusion.
When all factors are considered objectively, I think we must at least consider it is equally likely this is a short term play to extract max value in negotiated terms.
You’ve been a senior executive, you’ve had to strategize highly complex contracts and deals. (I assume)
I’ve been on the buy side of more than my fair share of large, complex, strategic contract negotiations (it’s kind of what I do). Specifically, dealing with entrenched SW or infrastructure where the client/company is handcuffed to the solution.
In some cases these have a 2+yr planning and execution cycle with the sole intent of creating disruptive leverage to shift the negotiating position. Done correctly, this process looks a LOT like what we are seeing with tariffs. In almost every instance where the client is handcuffed to the solution, the process required the customer to absorb some level of pain.
This was the hardest part of the process, getting the business to understand they are in a shit situation and they have to eat some pain to get an improved long term situation.
Is it possible we are not facing a cataclysmic long term scenario and there is another desired outcome for which the current strategy supports? A more balanced level of trade.
I think we can all agree the tactics are brutish, distasteful, and off putting. But are they really any different than tactics used every day to extract max value in commercial transactions?
Edit: I agree they are painful and disruptive. I’m also not fully convinced this is the right approach and equally apprehensive of possible negative consequences. You can’t just turn the dial to “11” and set it back to 5 and everything hums along - lol.
So I’m not discounting the concerns, at all. I’m just trying to be objective and think through what’s the purpose and all “possible” outcomes vs just doom and gloom.