Raimondo: Trump's Tariffs Will Outlast Him
President Donald Trump's tariffs will last beyond his term in office, former Commerce Secretary Gina Raimondo predicted during a Nov. 19 event hosted by Bloomberg.
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Raimondo said that the situation will remain murky for businesses throughout Trump's presidency and the "one thing" that can be counted on is that "there will be tariffs." She said that she knows from experience, working for former President Joe Biden, that tariffs, "once they're put on, are hard to take off."
Asked if she thought it would be difficult for future administrations to roll back Trump's tariff policy, Raimondo responded, "I really do." She said that "no one wants to be the American president accused of letting down the American worker," and tariffs protect workers.
Raimondo said she spent "many hours in the Oval Office" trying to convince Biden to lower tariffs, but that he would say, "I don't want to be responsible for losing a single American manufacturing job. I'm not lowering the tariff."
Any expectation that the tariffs might come down if the Trump administration gets its way diplomatically is misplaced, Raimondo said, because "they really believe in tariffs." The tariff policy is not "just a convenient political thing that they've done," to coerce other countries, she said, but is "core to his strategy." She said that Trump has a "real belief" in tariffs and that he "feels he was elected to deliver" them, "and so that's why I think they're here stay."
The administration "came out strong" with triple-digit tariffs on China, which Raimondo says will not return, and she predicted that "the trade space is somewhere between 10%, 15% and 50%," depending on the country. There will, however, be "plenty of exemptions," she said.
John Waldron, president and COO of Goldman Sachs, agreed that the tariffs are "a permanent fixture of the Trump administration's policy," but said that they are becoming "more targeted" due in part to the "realities of supply chains" and the need for exclusions to "actually make companies work." He predicted that the administration will reduce tariffs further as the midterm elections approach because affordability will become a "very significant issue in America." As the Republican Party focuses on trying to win the midterms, he said, he expects to "see them start to pull back" on tariffs.
However, tariffs will remain a "permanent fixture" of the Trump administration's negotiating strategy, Waldron said, because having "bilateral tariff ability" is how "they want to conduct foreign policy." He said he doesn't "see that changing post the midterms."
Waldron predicted that trade tensions in North America will fade because "the realities of actually driving down inflation and having a more sensible trade policy will require ... a more measured approach vis-à-vis the USMCA."
The effective tariff rate is "migrating down towards the mid-teens or even lower," Waldron said, depending on how the administration chooses to implement exclusions and "what they decide to do vis-a-vis USMCA and the like."