Trump thinking about running for President

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This week, billionaire Donald Trump stated on CNN during an interview that he is “seriously considering” running for President. The main issues that seem to be on his mind are how the U.S. deals with China and OPEC. For some time now, Trump has been complaining that the U.S. government is doing a terrible job in negotiating and dealing with China. He isn’t only blaming the current President, but also President Bush.

Trump is a Republican and would run as one if he were to run for President. He says that OPEC is gouging the U.S. and rest of the world with the artificially high oil price. With China, he dislikes how they manipulate their currency and how they steal Intellectual Property. Trump’s plan is to tax China 25% on all imports coming from there. He says this would quickly reduce the national debt by a lot. I haven’t checked his math, but I will assume that he is more or less right on that. In addition, he has said in the past that he would have business negotiators do the negotiating with China instead of the politicians and bureaucrats that currently do it.

His plan for China is very aggressive. It sounds good on the surface because within a short time the national debt would be greatly reduced which is something no one else has been able project with any other plan. It would also level the playing field in terms of trade between the two countries which is currently leaning in favour of China. However, placing a huge 25% tariff on all Chinese goods would instantly increase prices for so many products in the U.S. This could have a very bad impact on the U.S. economy for the short and medium term.

Beyond that, the problem with this plan is that it is playing with fire. The U.S. and China are the two largest economies in the world. This plan would create a very bad relationship between the two countries that could result in the cutting of diplomatic ties and even talks of war (although that would not happen). In this scenario, the entire global economy (including the U.S. and China) would most likely be hurt quite badly.

Although I understand his frustration with China, it seems that he wants to react out of that frustration and anger and this is not how make big decisions. I agree with getting a little tougher with China and bringing in business people to negotiate, but a 25% tax on China is too much.