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President Trump took office 101 days ago after a campaign in which the voters bought his argument that he could skillfully manage the economy and that his political recipes could enhance growth and eliminate inflation.
Therefore, the news on Wednesday that the country’s gross domestic product has contracted in the first three months of the year, it was a sharp political tremor, as well as a flashing economic warning.
It came at the end of a quarter, the stock prices decreased sharply, and the worst performance of Wall Street at the beginning of a new presidential term since Gerald R. Ford directed the country from scandal and inflation 51 years ago. It was added only to the wide uncertainty between companies and consumers about what the rest of the year may carry, as Mr. Trump continues a commercial war that actually suffocates supply chains and threats to raise prices and lead to a lack of components and products on shelves.
It is too early to predict the place where the American economy is heading for the rest of the year, and Mr. Trump still insists that he will lead to a wave of commercial deals that will return manufacturing to the United States and enter into a new era of prosperity.
But the characters in the first quarter brought the political risks to him to focus. For Mr. Trump, what is at stake is the issue of fundamental competence on the issue of always being used to defining himself.
If the report proves that it is a harbinger of the slow slow or stagnation, the economic analog situation of President Joseph R may become. Biden Junior from Afghanistan four years ago this summer. Mr. Biden’s job approval categories have not been recovered from that early disaster. Nothing he did later – not millions of jobs created, not the great legislative victories, and not a quick response to Russia’s invasion of Ukraine – it can restore a sense of voters that it can be trusted to carry out the task with the skill that they assumed to bring.
Mr. Trump stood in the garden of roses on April 2, what he called “Tahrir Day”, and put forward a wide and punitive set of definitions to commercial partners. He promised that other countries begged an agreement to decline these fees and other definitions that they imposed.
A large number of Americans appear skeptical. In a poll at the New York Times/Sienna College last week, 55 percent of Mr. Trump’s dealings of economy rejected, with 43 percent approval. About half of the voters refused to deal with Mr. Trump with trade.
Some of Mr. Trump’s economic advisers now realize that the timing and implementation of customs tariff ads may prove that it is tremendous mistakes, even if they are the basic strategy. For this reason, every few days, they announce new exceptions, the last of which is to relieve pain for American auto companies.
Matthew B. Godman, who runs the center of the geological economy in the Council of Foreign Relations, “on April 2, who stands in the world’s most powerful place, I think he was offering American power.” “But he discovered that the trade is complicated, and that you needed to be more surgical, and he had to return from that since then.”
Mr. Trump, the billionaire real estate investor, acknowledged that his strategy will bring some temporary pain to the Americans, but it seems that he argues on Wednesday that he will not notice ordinary Americans, at least in gaming stores.
“Well, children may have two dolls instead of 30 dolls, do you know?” He said. “Perhaps the dolls may cost two more dollars than usually do.”
Whatever the cost of Barbie, Mr. Trump faces a basic timing problem. It will take years for huge investments that are expected to flow to the United States to reveal and achieve the industrial renaissance he promised. For example, the construction of a five -year semiconductor manufacturer can take five years.
“These chips, these beautiful chips, are making these suckers in the United States,” said Mr. Trump at the White House on Wednesday.
It is too early to know the speedy start of these investments, including Apple’s commitment, which Mr. Trump praised again on Wednesday, to invest $ 500 billion, including a large part of its manufacturing ability, in the United States during the next four years.
But the economic pain of definitions can start within months, with the rising pressure on prices and the lack of industrial products and consumers abroad.
Many of Mr. Trump’s political problem lies in this separation. For many products, Americans will pay more for Chinese Chinese products-no American alternative. For many, its production in the United States may have no meaning.
Although it reduces economic concerns, Mr. Trump is clearly sensitive to the possibility of blame for high prices. When the reports began to trade this week that a company affiliated with Amazon was considering publishing the definitions that customers pay on each product, Mr. Trump is called Jeff Bezos, the founder of Amazon, for the complaint.
The White House said that giving consumers detailing the extent of the tariffs of the tariff, it would be “hostile and political.” The Amazon soon said she did not fully agree to the plan, and that she would not come into effect.
But many business leaders shake the environment, saying they have no way to drop their profits for the second quarter because the economic environment was never more mysterious.
“I still tell them not to reduce Donald Trump,” said David McCainchosh, president of the club, said the group of tax control, whose members were almost unanimously chanted to Mr. Trump’s return to his post.
Mr. Mcintosh said he is optimistic that Mr. Trump will succeed in negotiating the customs tariffs with Western -style democracies that are ranked among the largest commercial partners in America. “I faced many executives asking,” Well, how does Donald Trump do this? “My answer is to wrap their minds about” the art of the deal “, which is a general negotiation.”
He said that the way to calm the markets now is “obtaining Congress to complete the tax reduction bill” and expand the scope of taxes that Mr. Trump obtained in his first term.
Mr. Mcintosh presses the expansion of the tax reduction, specifically by allowing companies to remove the cost of building new production facilities immediately, instead of reducing these costs over decades.
Mr. Trump may record some early victories. “We are very close to India,” said Treasury Secretary Scott Beesen on Tuesday. He added that South Korea was “sending its team” to negotiate and that the deal was also possible with Japan. Mr. Trump said on Wednesday that the new Prime Minister in Canada, Mark Carne, had called him the day before and said, “Let’s make a deal.”
Perhaps, but Mr. Carney was also saying on Tuesday after winning the Canadian elections: “Our old relationship with the United States has ended, a relationship that relies on the increasing integration steadily.
Mr. Carney pledged to reduce Canada’s dependence on its huge neighbor, and there is no easy task because bilateral trade reaches about five economies of the country. China, the strongest player in Mr. Trump’s commercial wars, follows a similar strategy. And its leader, Xi Jinping, has every incentive to make the next few months politically painful to Mr. Trump as possible.
Mr. Shi has maintained a largely radio silence since Mr. Trump announced an escalating group of definitions on Chinese goods, and settled by 145 percent after several movements and counter -materials with Beijing. This rate is so high that it freezes mainly. There are already reports on the cargo companies loaded with the goods that are operated, so that importers do not have to pay these definitions.
Mr. Trump’s bet is that Mr. Shi Siomed first because the pain of the Chinese economy will be so great that he will have to hit housing that will allow the United States over time to return to something that is close to normally. Mr. Shi is betting on the contrary: Mr. Trump has exceeded, and he cannot afford the numbers of the bad GDP, high inflation or decrease in opinion polls.
Only one of them is right.