According to the latest report of JPMorgan Chase, the largest financial group in the United States, after the next round of US tariffs on China came into effect on September 1, the tariff cost borne by American families will increase to about US$1,000 per year. CNN The analysis said on the 20th that this analysis is very different from what the White House officials had previously stated. Some American media reports show that more and more ordinary Americans are experiencing the pressure of trade. Trump, while denying the US economy facing a recession, also admitted to considering new tax cuts to boost the economy.
JP Morgan Chase reports “face” White House officials
Last weekend, US Presidential Trade Adviser Navarro announced on television that the tax on China would not harm American consumers and that China is taking on the consequences of the trade war. Kudlow, director of the White House National Economic Council, also said on the show that even if the US-China talks are now stalled, China’s imports are facing additional tariffs, and the US economy is “still good”.
However, CNN said in the report that although US government officials insist that the trade war with China will not harm American consumers, JPMorgan’s assessment data indicates that “Trump is playing with fire”. Trump’s two rounds of tariffs on Chinese exports to the United States since last year will cost the American family an average of $600 per year. If an additional $300 billion of Chinese exports to the US are imposed on tariffs from September 1, the average annual burden on American households will increase to around $1,000. If the tariff is increased to 25%, the additional cost to the consumer will be further increased to $1,500 per year. JPMorgan’s views are based on research by the Federal Reserve Bank of New York and academia, which is quite different from what the White House has always said.
The report said that the latest round of tax increases has included a range of consumer products including video game consoles, television and clothing. “Tarms will significantly affect the US consumer/elector’s wallet before the 2020 election.” JP Morgan Chase Stock In a report sent to bank customers last Friday, strategist Bujas wrote that he believes that tariffs imposed on China will offset most of the benefits that Republican tax cuts bring to American families.
“Trump is killing our business”
“American truck drivers voted for Trump in hordes in the 2016 elections, but now the trade war has made them almost lose their livelihood.” The US business insider website said on the 21st that according to a 2016 survey by Overdrive magazine, about 75% of American truck drivers support Trump. However, truck shipments have been in recession since the end of 2018 as a series of tax changes and manufacturing data declines, resulting in a sharp drop in transportation. Many people associate these two trends with Trump’s economic policies.
According to the report, the Cass shipping price index shows that the volume of truckloads in the United States has fallen for eight consecutive months. According to the American Institute of Supply Management, the increase in factory activity in June was the slowest since October 2016. This means that manufacturers have fewer orders and less traffic. In the eyes of truck drivers, the decline in data is related to Trump’s trade war. A truck driver said, “Trump is killing our business. If consumers’ purchasing power declines, there is no transportation demand.”
Trump said at the 2017 truck driver event that “US priority” means putting American truck drivers first and promised to cut taxes to help their businesses. However, Trump’s 2017 tax reform has increased the tax on many truck drivers. A tax accountant who specializes in tax work for truck drivers told the media that about 75% of his clients paid unusually. High taxes, about 20% of people have to pay more than 5,000 US dollars in taxes.
Trump’s other support group, the American farmer, was also shaken by the consequences of the trade war. “The farmers around me are very unconfident about the prospects of the trade war.” James Henderson, 711 farm manager in Utah, USA, said in the Fox TV show on the 20th, “We are the losers in the trade war agriculture field, the past In a year and a half, my product lost $35,000 to $40,000 in the market.” In his view, many farmers have not been able to support Trump’s agreement with China on trade issues.
White House considers tax cuts
As the trade war intensified, the Fed lowered interest rates to offset the uncertainty of tariffs. In early August, US consumer sentiment fell sharply to a seven-month low. The US “Capitol Hill” said on the 20th that Trump met with the visiting Romanian president on the same day and said that the White House is considering various tax cuts including the reduction of payroll taxes and capital gains tax. Earlier reports said that because the US economic recession is imminent, the White House is discussing the promotion of economic development through tax cuts.
According to the report, people pay wages tax to finance social security and medical insurance. Cutting these taxes can temporarily help the middle class, but it may also increase the deficit and is likely to damage the social security system. According to a survey released by the National Business Economic Association on the 19th, most of the economists surveyed believe that the US economic recession will come in the next two years. Gopinate, chief economist of the International Monetary Fund, said on the 21st that Trump’s economic policy will not help solve the US trade deficit and will drag down the global economy.
