A new study finds that Trump’s trade war is going to slow down the economy and cost 2.75 million Americans their jobs over the next decade.
Here are the key findings from a new study by Impact Econ:
– Gross domestic product (GDP) would be reduced by a projected -1.78 percent in 2019 (or $365.1 billion in 2017 dollars) with a long run reduction of -1.25 percent in 2030 (or $331.8 billion in 2017 dollars).
– GDP losses are projected to cumulate to a discounted value of $2.8 trillion between 2018 and 2030.
– All countries, except the US and China, gain from US trade actions and responses and increase GDP.
– In 2019, households suffer losses equivalent to $2,357 per household (or $915 per person) in 2017 dollars.
– High economic growth in the US will initially protect workers from unemployment, however as more trade actions are initiated, and partners respond, increased unemployment could ensue.
– In 2019, we find that 2.75 million workers are likely to become unemployed if all trade actions are implemented concurrently. With the implementation of each additional trade action, underlying wage growth in the economy is diminished, increasing the probability that workers will become unemployed. With such large negative impacts from the combined trade actions, it will be difficult for the US to maintain wage growth and full employment.
– A high proportion of these job losses affect agricultural and low-skilled workers (e.g., workers in manufacturing where activity will slow due to higher costs for intermediate inputs into the supply chain caused by US trade actions and its partners’ responses).
– In addition to those unemployed, we also project a further 665,000 workers will be displaced in 2019 and must find employment in new industries. By 2030, 1.07 million workers will be employed in a different sector, but for the trade actions.
Trump’s trade war is going to cost your household almost $2,400 next year
Contrary to what Trump believes, trade wars are not easy, and the American people are not winning his current trade war. It is important to remember the trade war is unnecessary. Trump took this action because he thought that it would make him look strong with his supporters and be an easy political win.
The exact opposite has happened. The stock market has crashed. The economy is showing signs of a recession looming in the distance, people are losing the jobs, automobile plants are closing down, and crops are rotting in storage.
The trade war is a loser for the American people, and according to this study, things are about to get a whole lot worse.
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