Trade

“Companies don’t plan by tweet”

JM Ashby
Written by JM Ashby

Trump's tariffs on over $300 billion in Chinese goods will hit the books in a little less than four weeks, but those tariffs still remain somewhat of a mystery because the Trump regime has not published a final list of goods that will be subject to tariffs.

Bloomberg reports that company executives and lobbyists are scrambling to find out which of their goods will be taxed and if any have been exempted, but the office of Trump's trade representative can't tell them because there is no final list.

There's no final list because Trump announced his tariffs on a whim last week and now everyone is playing catch-up.

Without knowing exactly what's going to happen, some executives can only say that they're going to cut jobs in proportion to whatever tariffs hit them.

Companies don’t plan by tweet,” Jon Gold, of the National Retail Federation, said. “These are all contracts that are already executed and cargo is on the water.” [...]

Jay Foreman, the chief executive of Basic Fun! toy company in Florida, which makes the Lite-Brite and other products, said he’ll have no choice but to reduce employees by the same percentage as the duty.

We are not making toys here using imaginary elves from the from North Pole,” Foreman said Wednesday on conference call with reporters arranged by Tariffs Hurt the Heartland, a campaign of trade groups opposed to the tariffs. “American workers are designing, developing, selling, shipping and trucking our toys.” [...]

Win Cramer, the chief executive officer of California-based JLab Audio, said he was in Minneapolis on Wednesday visiting with two retailers -- and instead of talking about holiday plans, they were discussing tariffs. It’s impossible to plan because of the uncertainty of what Trump will do next, he said.

“The answers aren’t there yet because we don’t know what we don’t know,” Cramer said on the conference call. “These decisions are made with a tweet, they can also as easily be reversed with a tweet. So we’re kind of in wait-and-see mode.

The office of Trump's trade representative Robert Lighthizer has denied it, but Bloomberg reports that Lighthizer advised Trump not to impose additional tariffs just hours before Trump made the announcement.

This is a case study in the idea that everyone who works with Trump is eventually humiliated. I would tell you that Robert Lighthizer is unhinged and has some very wrong ideas about international trade and macroeconomics, but his disconnection from empirical reality is still not as complete as Trump's.

You could say the same thing for some of these same executives who are crying about uncertainty now that uncertainty is dangerously real. We're not talking about the prospect that President Obama might impose a small, negligible tax or unveil some new minor regulation that sends executives to their fainting couch. We're talking about the disruption of entire industries and markets. We're talking about Trump pushing entire sectors of the economy to the brink.

Republicans are bad for business it's long past time for executives and shareholders to think beyond the next quarterly report and see it.

  • muselet

    Long-term, yes. Rs are bad for business. They make foolish decisions, mostly based on their dim understanding of economics, both macro- and micro- varieties.

    Short-term, though, Rs are good for business executives. Cutting the top income tax rate, cutting the capital gains tax rate, adding complexity—and therefore loopholes—to the tax code, discouraging union membership, those things mean more money in the already bulging wallets of CEOs. Most business executives figure they’ll be on to their next gig before their current company collapses, so why worry about the long term?

    As for Jon Gold, Jay Foreman and Win Cramer, well, they’re right. They can’t plan for the future because Donald Trump is impulsive and impatient. They need to say so, loudly and often, and back up their words with action; I’d prefer to see them back the campaigns of Ds, but if they can convince their fellow execs to call Trump out, that would be a good start.

    I won’t hold my breath.

    –alopecia

  • waspuppet

    Gee, if only Trump were a successful businessman of some kind he might know this.

    • 1933john

      Business 101 – You can’t do it all by yourself,
      especially if you’re a self-styled “Know-it-all”.