讀後心得

Trump's "equivalent tariffs" policy may be compared by future generations to significant historical economic events, such as the Nixon and Smoot-Hawley Tariff Acts. This policy reshaped global trade but caused destruction, dismantling nearly 80 years of the global economic system and triggering geopolitical restructuring. Trump declared April 2 as the United States' "Economic Independence Day," subsequently imposing a 10% tariff on all imported goods, with higher rates for certain countries. This move harmed the global economy, reduced demand, and had a significant tightening effect, necessitating a substantial downward adjustment of future economic growth. China and other countries may take retaliatory measures, and if the situation persists, the global economy will face even greater challenges. Furthermore, Trump's high tariff policy has also impacted geopolitics, undermining trust among allies and prompting policy restructuring. Even if manufacturing returns in the future, the short-term inflation rise and economic downturn will not yield benefits. Ultimately, Trump's policies may lead both the U.S. and the global economy into peril.

Perhaps, when future generations look back on Trump's "reciprocal tariff" policy, they will compare it to the Nixon shock of the 1970s, the Smoot-Hawley Tariff Act of the 1930s, and the Bretton Woods Conference post-World War II, as it fundamentally changed the landscape of global trade and economics. Unfortunately, this policy led to destruction, dismantling the global economic system established over the past 80 years, and triggered a geopolitical reshuffling. Trump designated April 2nd as "Liberation Day," the "economic declaration of independence" for the United States, claiming it was one of the most significant days in American history. Countries around the globe held their breath and made various predictions about possible scenarios; however, the final plan was unexpectedly severe, with unimaginable extensive repercussions: Trump imposed a comprehensive 10% tariff on all imported goods, while certain countries faced even higher reciprocal tariffs. For instance, Taiwan faced a heavy 32% tax, China 34%, Indonesia 32%, the European Union 20%, India 26%, South Korea 25%, Japan 24%, Switzerland 31%, Vietnam 46%, and the United Kingdom and Brazil were at 10%.

This significant policy's impact on global trade and economics is primarily reflected in two aspects: first, the damage to the global economy leading to a downturn. Increasing tariffs will result in higher costs and reduced demand; in short, tariffs have a contractionary effect on the economy, impacting both the United States and those countries facing high tariffs. As the world's largest economy and import market, the tariff war initiated by the United States has far-reaching consequences. It must be emphasized that the tariffs raised by Trump far exceed the announced figures. For example, while the baseline tariff is 10%, due to most major economies and trading partners imposing higher reciprocal tariffs, the overall increase in U.S. tariffs far surpasses the surface figures. Moreover, before the reciprocal tariffs were implemented, the United States had already started a tariff war; China faced a 34% tariff under reciprocal tariffs, while previously, a 20% tariff was already imposed, resulting in a total import tax rate of at least 54% on U.S. goods. Additionally, during Trump's first term, multiple products from China were already subject to a 25% tariff, which cumulatively increases these rates, bringing China's tariff on U.S. goods to as high as 79%. Similarly, Canada and Mexico were also previously subjected to a 25% tariff; thus, even if Canada and Mexico were not on the reciprocal tariff list, the situation remains severe.

If a country experiences a sudden reduction in demand from its primary export market (due to soaring tariffs), its export volume will inevitably decline, subsequently affecting its economic performance. Furthermore, these contractionary effects will mutually reinforce each other; Taiwan is not only facing a decline in exports to the United States but also has to endure economic contractions from affected countries like the EU and China due to the tariff war. Taiwan's economic decline will further impact other countries it trades with. Therefore, if this tariff war cannot be resolved in the short term, economic growth forecasts for countries will be significantly downgraded. Currently, it is impossible to accurately predict the ultimate impact on the global economy, as it all depends on how countries react. If countries sequentially impose retaliatory tariffs on the United States, leading to further tariff increases by the U.S., it will create a vicious cycle, resulting in entirely different outcomes compared to a scenario of "negotiation instead of retaliation."

From the current situation, China is the most "decisive," having directly announced an additional 34% tariff on U.S. imports. The EU has threatened retaliation but has yet to propose specific measures, Canada has indicated it will retaliate, and most other countries are still observing and even hesitant to retaliate. For example, Indonesia, which faces a 32% tariff, has stated it will not retaliate, and countries like Australia and Mexico have also expressed they will not retaliate. Asian export-oriented economies like Japan, South Korea, and Taiwan are also unlikely to retaliate, as the U.S. has warned that those who retaliate will face higher tariffs. However, as long as conflicts arise between the EU, the U.S., and other large economies, the global economy and trade will suffer severe blows. Another significant but latent impact on the global economy, while not initially obvious, could have more profound implications: the collapse of globalization and free trade, leading to the paralysis of the WTO. These were parts of the global economic system that the U.S. once established and supported, and after Trump promoted the tariff war, the future looks quite concerning. However, if the EU and China can exercise restraint and only retaliate against the United States while maintaining an open stance toward other countries, it may still preserve the WTO, allowing globalization and free trade a slim chance of survival.

In addition to the economic impacts, Trump's reciprocal tariffs are also likely to affect geopolitics. His heavy-handed approach to allies, treating them indiscriminately, is undoubtedly disheartening. The United States' strongest geopolitical rival is China, and even if Trump's actions do not cause allies to completely shift towards China, they will undoubtedly lead some allied nations to readjust their positions. A comparison of countries' attitudes between the Biden administration and Trump's era illustrates this point, particularly with Europe, Japan, and South Korea standing out. Under Biden's administration, the EU has clearly leaned towards the U.S., aiding in constraining China, whether through "decoupling" or subsequent "de-risking," they have worked to align with the U.S. position. However, following Trump's rise, European strategic autonomy and military independence, as well as their efforts to build low-orbit satellites to avoid dependency on Starlink, all reflect Europe's mistrust of the U.S. This reciprocal tariff has severely impacted the EU by 20%, and there have been threats of retaliation, with the French president even calling for European companies to suspend investments in the U.S. The conflicts have deepened, and the relationship within the "Transatlantic Alliance" has become irretrievable.

During Trump's first term, many viewed it as an unexpected derailment, while Biden’s ascent was seen as a return to the right track. However, during Trump's second term, outsiders suddenly realize that what Trump represents might actually be the "right track" for the future of the U.S. In other words, even after Trump leaves office, his policies and mindset are likely to continue dominating the direction of the U.S. In fact, Biden has allowed for the continuation of most of Trump's policies, especially as Trump seeks a third term. China may not be able to or may even struggle to rally Europe, Japan, and South Korea to confront the U.S. together, but if these countries distance themselves from the U.S. and cease cooperation against China, it will be a gain for China. If Trump consistently adopts heavy-handed measures against allies, this geopolitical reorganization will inevitably continue and may intensify. Even for small developing countries with limited economic scale and international influence, the question of whether to continue following this "big brother," who once supported them through open markets, when he begins to penny-pinch and block foreign goods with high tariffs, will need to be reassessed.

Even if other countries do not retaliate against the U.S. regarding the reciprocal tariffs, the United States will still find it difficult to benefit; building factories and supply chains is not an overnight task, and the manufacturing return Trump envisions will not manifest immediately. Consequently, in the short term, price increases and rising inflation will inevitably occur alongside a decline in economic growth. In the medium to long term, even if some manufacturing returns, production costs and prices will rise significantly. The U.S. and its people will not benefit as a result, and the global economy will suffer further blows. Trump has painted this self-harming policy in such a glorious light, referring to it as America's "golden era," but the sharp decline in the U.S. and global stock markets, alongside the depreciation of the dollar, are in fact market rejections of this policy, which clearly has not reached the "satisfaction point" of the market. Will Trump have a change of heart?