SINGAPORE (Oct 15): The most frequent questions I get when I speak to non-economists concerning the US tariffs on imports from China: Why is US President Donald Trump’s administration doing this? Aren’t the tariffs a tax on the goods purchased by US consumers? Why does Trump think the US can “win” a trade war with China? How do the Chinese respond to the current tariffs and threats of more? And so on.
I usually start my answer by stressing that, like almost all economists, I oppose tariffs in general. I acknowledge we have an enormous trade deficit with the rest of the world (about US$800 billion or S$1.1 trillion this year, or 4% of US GDP) and that our trade deficit with China is about half of...(click on link for full story on theedgesingapore.com)