Reference Message Network reported on April 2 that the "conversation" website of Australia published an article titled "Three Arguments in the Long-term Game of Trump's Trade War" on March 31. The author is Marcus Wagner, professor at the University of Wollongong, Australia. Here is a compilation of the article:

Since taking office in January this year, US President Donald Trump has vigorously promoted trade measures centered on tariffs to reshape global trade. He plans to impose reciprocal tariffs on so-called "Liberation Day," which is April 2.

The Trump administration claims that American producers face higher tariffs and more restrictions abroad compared to foreign producers exporting to the United States.

The Trump administration also studied tax systems such as Europe's value-added tax and Australia's goods and services tax, as well as import regulations and other factors. The Trump administration believes that these unfair practices put American businesses at a disadvantage and contribute to America's trade deficit – a view that is almost entirely wrong.

Like many of Trump's initiatives, even if tariffs are actually imposed, the actual rate often undergoes significant changes between announcement and implementation.

Trump's reciprocal tariff plan has been narrowed down to only target the largest few trading partners of the United States, rather than all countries. The United States may also impose tariffs on specific industries. Last week, Trump announced a 25% tariff on imported cars. He said he "didn't care at all" whether this measure would make cars more expensive for American consumers.

Trump has proposed countless bewildering reasons for taxation, roughly divided into three categories:

Firstly, using tariffs as a tool of coercion against other countries. During Trump's first term as president, trading partners were forced to renegotiate trade agreements, such as the newly named but essentially unchanged "United States-Mexico-Canada Agreement".

In the same vein, the Trump administration used tariff threats to gain market access, secure more favorable trade terms, or as a trade weapon to achieve originally unrelated foreign policy goals. Last week, Trump said he would consider reducing tariffs on China in exchange for China agreeing to sell TikTok.

Secondly, using tariffs as a source of revenue. The Trump administration envisioned that tariffs would be collected by a yet-to-be-established Foreign Tax Bureau.

Trump claimed that tariffs would be paid by exporting countries. In theory, this would provide funds for future tax cuts. However, in practice, tariffs are almost always paid by importers of goods and usually passed on to consumers.

There is a potential contradiction between these two ideas. The Trump administration seems to hope that at least part of the tariffs will be made permanent. But doing so, the role of tariffs as negotiating chips and coercive tools would almost completely disappear.

The last category is to encourage enterprises to "return" to the United States and support American jobs. Some manufacturing may return to the United States. However, the high costs of building new factories, re-planning supply chains, and the lack of competitiveness of American labor costs will hinder large-scale returns.

The Trump administration's trade measures can be seen as part of its larger strategy to reshape the domestic and global economic systems of the United States.

In a recent speech, US Vice President Vance advocated for a structural reshaping of the American economy to enhance domestic innovation capabilities. Vance warned that "deindustrialization poses risks to our national security and workforce." Vance described tariffs as "necessary tools to protect our jobs and industries."

This argument overlooks some key factors. Tariffs lead to price increases. Unless currency exchange rates are adjusted, the impact of inflation may place those least able to afford it at a disadvantage. American farmers and other export-oriented industries will be severely affected. From a strategic perspective, America's status as a global leader has suffered a severe blow. Some countries are openly turning to their geopolitical and economic competitors, China.

If the United States exits the highly integrated international trade system (though it is unlikely to completely withdraw), it could eventually become a more chaotic version of Brexit.

The era of free trade after the end of the Cold War is coming to an end. Countries will turn inward, prioritizing their economic security and resilience. However, the cost of deviating from multilateralism and international institutions is not just economic.

Tight economic integration once reduced uncertainty in international economic relations, enhanced international security, and promoted prosperity.

Returning to the "beggar-thy-neighbor" policies of the 1930s is a dangerous path, as the world edges closer to the abyss. "Liberation Day" may push the world to the brink of collapse. (Compiled/translated by Hu Wei)

Original: https://www.toutiao.com/article/7488668988827009572/

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