Today in Politics, Bulletin 104. 4/3/25

… Trump unveiled his tariffs last night, and it was far worse than anyone expected. The tariffs varied by country, but most were extremely high and appeared to make very little economic sense. When we learned how the tariff rates were calculated, it showed that they were a function of our trade deficit with most of the countries. So if we buy too much from a country, Trump imposed huge tariffs on them. In other words, they are NOT reciprocal tariffs, even though the WH is calling them that.

… JP Morgan issued a report saying that Trump’s tariffs are “the largest tax increase since the Revenue Act of 1968. The somewhat confusing nature of today’s news, coupled with uncertainty over how long these tariffs will remain in place, should make for an even less friendly environment for investment spending.”

… Sen. Rand Paul today in the Senate: "Despite arguments to the contrary, Americans know tariffs are a tax they are going to have to pay. The Founding Fathers so feared the power of taxation that they gave it only to Congress. I stand to speak against the tariffs. I stand to speak against the idea of skipping democracy, of skipping the constitutional republic, of rejecting our founding principles. I do this because I love my country. This is a tax, plain and simple, and taxes should not be enacted by one person."

… James Surowiecki, former Editor of Financial Page at the New Yorker: “I just figured out where these fake tariff rates come from. They didn't actually calculate tariff rates + non-tariff barriers, as they say they did. Instead, for every country, they just took our trade deficit with that country and divided it by the country's exports to us. So we have a $17.9b trade deficit with Indonesia. Its exports to us are $28b. $17.9/$28 = 64%, which Trump claims is the tariff rate Indonesia charges us. What extraordinary nonsense this is.”

… Former Treasury Sec Lawrence Summers: “It’s now clear that the Trump Admin computed reciprocal tariffs without using tariff data. This is to economics what creationism is to biology, astrology is to astronomy, or RFK-thought is to vaccine science. The Trump tariff policy makes little sense EVEN if you believe in protectionist mercantilist economics.”

… WSJ analysis: “He’s hitting China with a 34% tariff, but our Japanese friends will pay nearly as much at 24%. The EU gets whacked with 20%, India with 24%.” The Journal then listed a series of impacts tariffs will have. These were some:

• “There will certainly be higher costs for American consumers and businesses. Tariffs are taxes, and when you tax something you get less of it. Car prices will rise by thousands of dollars, including those made in America. Trump is making a deliberate decision to transfer wealth from consumers to businesses and workers protected from competition behind high tariff walls.”

• “Tariffs impose costs that businesses will want to avoid. They will thus be a windfall for Beltway lobbyists as companies and countries seek exemptions from this or that border tax. Trump is saying there will be no tariff exemptions. But watch that promise vanish as politicians, including Trump, see exemptions as a way to leverage campaign contributions from business. Liberation Day is Buy Another Yacht Day for the swamp.”

• “The cost in lost American influence will be considerable. Trump thinks the lure of the US market and American military power are enough to bend countries to his will. But soft power also matters, and that includes being able to trust America’s word as a reliable ally and trading partner. Trump is shattering that trust as he punishes allies and blows up the USMCA that he negotiated in his first term.”

• “Trump’s new tariff onslaught is giving China another opening to use its large market to court American allies. South Korea and Japan are the first targets, but Europe is on China’s list. Closer trade ties with China, amid doubts about access to the U.S. market, will make these countries less likely to join the U.S. to impose export controls on technology to China or to ban the next Huawei.”

… Sky News highlighted some of the most bizarre tariffs:

• The Heard and McDonald Islands, an external territory of Australia in the Antarctic is inhabited only by penguins and seals. Despite having no human residents - or imports and exports - the island now faces a 10% tariff for any goods bound for the US.

• Australian territory Norfolk Island, a volcanic island 600 miles east of Queensland, was also hit with a hefty 29% tariff on exports to the US. That's much higher than mainland Australia, which had a 10% tariff imposed. The news was met with confusion by some of Norfolk Island's 2,188 residents. Business owner Richard Cottle: "Norfolk Island is a little dot in the world. We don't export anything. It was just a mistake.”

• Tokelau, a dependent territory of New Zealand, with a population of around 1,600 people, and the Cocos Islands, another territory of Australia, home to around 600 people, were hit with 10% tariffs. Australian Prime Minister Anthony Albanese: “It’s a bit strange".

• Lesotho in southern Africa, listed as the 22nd poorest country in the world, has been slapped with the highest duty of 50%. It primarily exports diamonds and clothing.

• The 2nd-highest tariff went to Cambodia at 49%, even though the US is Cambodia's largest single-country export destination.

• Madagascar in east Africa, the world's 9th poorest country, will face 47% reciprocal tariffs. It primarily exports vanilla, cloves, and clothing.

… Billionaire Trump-supporter Bill Ackman: “Sometimes the best strategy in a negotiation is convincing the other side that you are crazy.”

… Former Rep. Tom Malinowski: “Over 98% of the clothes we buy in the US are imported. So we can pay the tariff tax for them, or we can train hundreds of thousands of Americans to stitch clothes (diverting our workforce from the advanced manufacturing it should be doing) - and still pay more.”

… Commerce Secretary Howard Lutnick on Fox: "I mean, the European Union won't take chicken from America. They will take lobsters from America, but they hate our beef because our beef is beautiful and theirs is weak."

… The EU has a ban on chicken washed in chlorine - which is allowed by the USDA. The EU also only bans beef that has been treated with artificial growth hormones - which applies to most beef produced in the US.

… Canadian PM Mark Carney announced reciprocal tariffs of 25% on all vehicles imported from the US. He also made a statement about the US tariffs in general: “The effects on the global economy will be monumental.”

… Lutnick on CBS: "Foreign goods may become a little more expensive, but domestic goods do not. So if you're looking at Poland Springs water versus let's say Fiji Water, the Poland Springs is not gonna be more expensive. So for the first time in your lives you're gonna actually think about the Americans who make the products."

… Treasury Secretary Scott Bessent: “I would advise none of the countries to panic. I wouldn't try to retaliate because as long as you don't retaliate, this is the high end of the number.”

… Lutnick on CNN: "Let Donald Trump run the global economy. He's knows what he's doing. He's been talking about it for 35 years. You gotta trust Donald Trump in the White House. It's broken, let him fix it. Let Trump fix the American economy."

… Bessent was asked by CNN last night what he expects the stock market to look like today: “I don't know. You know, I don't know where it's going to trade. I don't know where it's going to close tomorrow.”

… Sen. Bernie Moreno (R-OH) to CNN: “I think the stock market is going to go very, very high.”

… Press Secretary Karoline Leavitt on CNN: “To anyone on Wall Street this morning, I would say ‘trust in President Trump.’”

… The Dow was down 1,679 (3.98%) today. NASDAQ was down 1,050 (5.97%), Tesla was down 15.48 (5.47%).

… Fox took the stock market ticker off their screen for the first time in the history of the network.

… Senator Angus King (I-ME) during a committee hearing: "I have to point out, Mr. Chairman, in the hour that we've been sitting here, investors in the US stock market have lost two and a half trillion dollars."

… Pastor Greg Locke: “If you bail on Trump when things get tough and uncomfortable, you’re weak. We voted for a better America not a perfect Utopia. Keep standing. Stay on the frontlines. Our Nation is in a moment of repairing the broken places. God is not affected by a stock market crash. Stop freaking out! Faithfulness and obedience is always rewarded in difficult times!”

… Morgan Housel, Director of Markel Group: I spoke to an investor who said, ‘if the market actually processed what happened yesterday it would be down 30-40%. The fact that it’s not is either denial or a belief that it will soon be reversed.’”

… On his way out of the White House to fly to FL for the rest of the week where he is hosting the Saudi-owned LIV golf tournament, Trump was asked about the stock market crashing today: “I think it’s going very well. It was an operation like when a patient gets operated on and it’s a big thing. The markets are going to boom. The stock is going to boom. The country is going to boom.”

… One of the only countries on the planet that wasn’t hit with a tariff just happened to be Russia. Go figure. WH Press Secretary Karoline Leavitt claimed to Axios that US sanctions already "preclude any meaningful trade.” But that is not true. The US trades more with Russia, despite those sanctions, than many of the countries on the sanctions list.

… Mike Pence: “The Trump Tariff Tax is the largest peacetime tax hike in US history. These Tariffs are nearly 10x the size of those imposed during the Trump-Pence Admin and will cost American families over $3,500 per year.” He then posted a link to an article titled: “Spoiling America’s Golden Age”.

… Sen. Bernie Moreno (R-OH): “Mike Pence - he's never run anything other than a political campaign. He's not a business guy. So he's repeating talking points. Trump is reversing the policies of people like Mike Pence, who sold this country out.”

… Lutnick: “Mike Pence is just bitter. These tariffs are the definition of America First, which is a concept he doesn’t understand.”

Yesterday on my podcast Uncovered we took a deep dive into the political implications of the tariffs and behind the scenes infighting in the Trump Admin about them, also talked about the WI election, Cory Booker and Schumer, Luna v. Mike Johnson, Vance’s trip to Greenland, and a few other things. Link to show is here.

… Sen. Rand Paul (R-KY): “The tariffs that Trump detailed mark the most significant US protectionist trade action since the 1930s, when Congress imposed tariffs on