Bessenet hinted that tariffs would melt away like "melting ice cubes," but only if manufacturing returns to the United States

According to a report by Nikkei Asia on August 11, U.S. Treasury Secretary Scott Bessenet made a vivid statement during an interview with the media: "Reciprocal tariffs" imposed by the United States on imported goods from other countries are like "melting ice cubes" and may disappear, but the so-called trade imbalances must first be "corrected" according to U.S. standards, and manufacturing must return to the United States first.

"Over time, tariffs should be like melting ice cubes," Bessenet said in his office at the Treasury on July 7.

On August 7, the tariff executive order signed by President Trump took effect, and the United States imposed higher tariffs on numerous trading partners. Yale University estimates that the current actual average tariff rate in the United States has reached 18.6%, the highest level since the end of World War II.

Bessenet, who is responsible for tariff negotiations with countries such as China and Japan, explained that the main goal of the Trump administration in using tariffs is to "rebalance" the U.S. current account deficit. As of the end of 2024, this deficit reached $1.18 trillion, ranking first among major economies. Bessenet had warned that such a scale of deficit could trigger a financial crisis.

Nikkei Asia Review believes that Bessenet's metaphor of ice cubes for tariffs seems to imply that "reciprocal tariffs" may be reduced or even abolished.

He said that over the course of 40 to 50 years, the United States lost its trade balance and lost a large number of manufacturing jobs. If manufacturing returns to the United States, imports will decrease and trade can be rebalanced. Bessenet also mentioned Japan, which has a high savings rate, while the United States has a high consumption rate, "so perhaps in Japan, you will start to consume more, and we will also start to produce more."

Bessenet did not provide a timeline for "correcting global trade imbalances" and lowering tariffs, only answering that "it's hard to know, and it will vary from country to country," "I think over time, we will achieve balance."

Regarding countries still engaged in trade negotiations, Bessenet expects most negotiations to be completed by the end of October. In his view, the negotiations with China are most important for the United States, but they are "full of challenges."

Bessenet resorted to old tactics, exaggerating that "a lot of Chinese production is below cost," defining China as the United States' largest "economic and military rival," and claiming that China is "different from Western economies and Asian democratic nations," attempting to stir up tensions between China and Asian countries such as Japan and South Korea.

He claimed that China is moving up the value chain, "which could be very worrying." Bessenet used China's significant advantage in the electric vehicle sector to "point out" Japan, saying that if China shifts to the hybrid car sector where Toyota holds a leading position, Japan would be in trouble.

Original: www.toutiao.com/article/1840146511652867/

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