Former Trump Economic Advisor: The Trade War Is Backfiring On America
President Donald Trump’s former chief economic advisor Gary Cohn has said the trade war with China isn’t working. Cohn told the BBC that Trump’s tariffs were not having their intended effect and were, in fact, damaging the US economy.
“I think the Chinese economy was going to slow down with or without a trade war,” Cohn said.
“I think everyone loses in a trade war. We are an 80% service economy. The service side of the economy is doing very well, because, guess what, it’s not being tariffed.”
Cohn has long been an advocate of free trade and he reportedly clashed with the President on the issue of tariffs. Trump has strongly supported tariffs, particularly on China, but there is little evidence his approach has made gains for the US.
“When you build plant equipment, you’re buying steel, you’re buying aluminium, you’re buying imported products and then we put tariffs on those, so literally the tax incentive we gave you with one hand was taken away with the other hand,” Cohn said.
“So we are not seeing the manufacturing job creation. And I think if we get through this tariff situation, there’s a real opportunity to see it here in the United States.”
Trump will not be happy to see Cohn criticizing his current policies, which most economists believe are counterproductive. Cohn’s comments come on the heels of a rate cut by the Federal Reserve and warnings of a slowing economy.