Even as he rails against “globalists” and insists his platform is “America First,” Donald Trump — like the rest of us — lives in an interconnected world. Here, the actions of a single nation are inextricably linked to those of other countries in ways both obvious and subtle. Trump likes to insist that other world leaders are salivating over the so-called global stability that would accompany his return to the White House in 2025. The truth is this. definitely more complicated. As national economists debate Facing the impact of the Trump campaign’s promise to impose extraordinary tariffs on all imported goods, international analysts are busy with their own calculations to determine the complex, cascading effects of a possible second Trump administration on global markets.
For his part, Trump has been particularly fluid on the details of his economic plans, offering a multitude of broad and disparate recommendations highlighting intense deregulation, lower corporate tax rates and the “best word in the world.” dictionary ” : prices. Nonetheless, the prevailing sentiment among those who make it their mission to understand the murky world of national finances is that a Trump economy would “lead to higher prices, larger deficits and greater inequality” domestically, a group of 23 Nobel Prize-winning economists said in an open letter supporting Vice President Kamala Harris’ national economic plan.
Globally, a second Trump term would “affect trade in multidimensional ways,” according to the Financial Times said. Plans to make “major changes in the value of the dollar, the world’s reserve currency, would have consequences that extend far beyond Washington.” Under Trump’s proposed economic policies, “a protectionist and smaller U.S. economy would be a drag on global economic growth,” said John Hawkins, an economist at the University of Canberra. The conversation.
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Trump’s “penchant for tariffs”, a sentiment that “most economists do not share”, would be particularly damaging internationally, CNN said. Not only would the tariffs “hurt global economic growth and drive up inflation in the United States,” but they could also have consequences abroad, “if other countries introduce higher levies in response.” on American imports. Trump’s return to the White House is the International Monetary Fund’s “elephant in the room.” The Guardian said. His second term and the “undesirable” economic policies he would implement “could reduce global GDP by 0.5 percentage points in 2026.”
Not only are economists arguing that Trump’s claim that consumers would not feel the effect of his tariff hikes is unrealistic, but his proposal could ultimately lead to a “sharp decline in stock prices, in particularly for American multinationals that rely heavily on international supply chains.” said Time review. A plan to impose a “60% import tax on Chinese goods and a 10% tariff on other imports” could potentially lead to a double-digit drop from the “record” closing date. S&P 500 from 5,792 at the start of the month, Forbes said.
However, while Trump’s proposals taken in unison could harm the U.S. economy, they “would benefit most other countries in the world,” the report said. Peterson Institute for International Economics. Areas with “less trade with the United States would be less affected by tariffs,” says the Washington-based think tank. This, in turn, “would attract greater capital inflows as investors, in response to the erosion of the Fed’s independence, seek to invest in countries less exposed to the United States, boosting the GDP”.
And then?
The “backdrop” for these arguments, the FT said, is the current US economy, which has proven particularly strong in these final months of the 2024 election cycle. Particularly in light of Trump’s plans aimed at destroying the independence of the Federal Reserve, the next president should be “eager to build on what is currently a resilient economy” rather than undermine it, according to the outlet. editors said earlier this summer.
Trump argued that his tariff plan would not only raise significant revenue, but would “increase domestic production, create good-paying jobs and reduce inflation.” The New York Times said. But by enacting broad, universal tariffs, the resulting trade wars would “ultimately harm all countries by restricting trade, disrupting global supply chains, slowing growth and raising prices.” price “.
