The former chief economic adviser to Donald Trump, Gary Cohn has said that the trade battle with China is having a negative dramatic effect on the US capital and manufacturing investment. He further said that China had used the trade war as a convenient excuse for slowing down their overheated economy.
Mr. Cohn resigned from his post from Trump administration in March of 2018. He was previously serving as the president of the Goldman Sachs bank. He laid his focus on economic internationalism while the president Trump was focused on economic nationalism. He served as director of National Economic Council under Trump from January of 2017 to April of 2018. His resignation came in after the decision of imposing tariffs on aluminum and steel was announced by Mr. Trump. Mr. Cohn said that he felt that despite the presence or absence of trade war, the Chinese economy would have anyway slowed down. He said that it was a long-time view of Trump that the tariffs would be able to solve the problems between US and China regarding the trade imbalances.
Mr. Cohn explains that a trade war brings losses to everyone. The US is an 80% service economy and the economy’s service side is doing good as it has not been tariffed. The imposing of tariffs has made the imports of vital products from China more expensive. He felt that the trade wars have resulted in geopolitical uncertainty which has stopped investments from business. He even went to say that the trade war is badly impacting the US more than the Chinese.
The president of the automotive Ford, Joseph Hinrichs said that the tariffs on aluminum and steel had a great impact on their business the previous year but the impact has subsided since then. He said that there is still some impact and they are paying for the raised tariffs however the situation is better compared to that of the last year.