Economist Oren Cass recently shared his insights on the Trump administration's tariff policies during a conversation with Tucker Carlson, co-founder of the Daily Caller News Foundation.
Cass expressed optimism about the potential of these policies to foster stronger alliances for the United States and promote free trade.
President Donald Trump's announcement of reciprocal tariffs has sparked negotiations with several countries. Some nations, such as China, have been hit harder than others due to their own tariffs against the U.S. In this context, Carlson sought Cass's perspective on the possible outcomes of Trump's economic strategies, particularly the "tariff story."
Cass explained, I think the best way to understand whats going on is to think about this kind of world order that weve been talking about a bunch. And recognize that what we are going through is a transition out of the U.S. as sole superpower to, I guess you would call it a multipolar world where China is a kind of peer, competitor and adversary.
According to the Daily Caller, Cass further elaborated on the changing dynamics of global power, highlighting the challenges of maintaining an open market in the face of China's growing economic and technological prowess. Were seeing in real time how it breaks down, how you cant just be the benevolent open market when China is now bigger than you and more technologically advanced in some ways. It cant go on that way, Cass stated.
Cass views the tariffs as a signal of the end of the old system and the beginning of a new order. He believes the U.S. should aim to maintain strong alliances and free trade among allies, a goal he sees the Trump administration working towards.
Following Trumps 'Liberation Day,' the president announced a 90-day pause on tariffs, with the exception of those against China. This move opened up trade talks with other countries and marked the beginning of a tariff war with China, which saw the U.S. impose a 145% tariff on the Asian nation. These discussions officially commenced on May 10.
Cass further explained that the U.S.'s tariff strategy aims to end the open season where everyone does whatever they want and unconditionally gets benefits of American defense [and the] American market. He emphasized the need for strong alliances and relationships and low tariffs, and introduced the concept of balanced trade as a new condition for these relationships.
Cass also stressed the importance of each country pulling its own weight in defense matters. Piece number two, on the defense side, everybody needs to pull their own weight and actually lead in their own areas. You want to deter Russia, Germany? Go figure out what you need to do to deter Russia. You want to deter China, Japan? Go figure out what you need to do. Dont be looking over your shoulder, sort of, Have I done enough homework to go outside and play? Actually get it done, Cass advised.
In addition to the tariff policies, Trump has been active in the Middle East, securing investment deals worth at least $600 billion with Saudi Arabia and over $3 trillion with the United Arab Emirates.
The third aspect of Cass's outlook involves removing China from U.S. supply chains. He believes this was the reason behind Trump's initial focus on Mexico and Canada in trade discussions.
Then piece three is China is out. More like in the Cold War system, you cant have these sort of entangled systems where, OK, the U.S. doesnt want Chinese supply chains, so they just go set up in Mexico and it comes in through Mexico. This is actually, I think, why Trump started the way he did with Mexico and Canada. Mexico and Canada with the U.S., you should be the core of this alliance were talking about, Cass explained.
Cass concluded by emphasizing the need for a new approach to trade alliances. But you need to understand that it cant work the way its been working. Its going to have to work on these terms, he said. He cited Treasury Secretary Scott Bessent's call for Mexico and Canada to adopt similar tariffs towards China as the U.S., to prevent a "sort of screen door" effect.
While Trump's economic policies and tariff push have been met with skepticism by some, others predict that these strategies could yield significant benefits for the United States. The unfolding of these policies and their impact on global trade dynamics will undoubtedly be closely watched in the coming months.
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