from Ron Cheong
News Americas, NEW YORK, NY, Mon. December 2, 2024: Influential thinker Thomas Hobbs outlined the political principles of his social contract theory in which there is an agreement between rational, free, and equal people.
In a move of self-interest, people agreed to give up some rights “to” in exchange for rights “from”. For example, men collectively gave up the right to trespass on their neighbors’ plot and in turn received the right to be free from nighttime attacks. In other words, they entered into a social contract in which they gain certain civil rights in exchange for placing their actions under the jurisdiction of a common authority and subjecting them to certain penalties for breaking the rules.
This thinking can also be applied to countries where cooperation and mutual agreements and treaties benefit everyone.
Machiavellianism, Narcissism and Psychopathy
But Trump would have none of that, he prefers fear, and even before taking office as the president-elect of the world’s most powerful country, he’s threatening high tariffs on neighbors, allies and rivals in a show power to him. base.
Taking a page right out of the 1513 treatise by Niccolò Machiavelli, for which the term Machiavellian is named, meaning: manipulation, indifference to morality, a lack of empathy, and a calculated focus on self-interest — Trump is threatening trade wars with everyone. world.
Machiavelli famously wrote in his political treatise, The Prince:
“… whether it is better to be loved than to be feared, or to be feared than to be loved. Perhaps we can answer that we should want to be both; but since love and fear can hardly exist together, if we must choose between them, it is much safer to be feared than loved.”
While Trump’s narcissistic side can never get enough salute, he has set out to inspire fear of destruction in the world community which is aware of his self-centered anti-social behavior and lack of remorse or empathy.
Possible costs in the US
But as China has said in response to Trump’s threat of an additional 10% tariff on all goods from China, “There are no winners in tariff wars. If the US continues to politicize economic and trade issues by weaponizing tariffs, it will leave no side unscathed.”
By way of a single example of the damage the US would do to itself – Walmart is the largest private employer in the US and the largest employer in 22 states. Walmart imported 60% of all goods sold in 2023 from China; which translates to $320 billion in cost of goods sold. These tariffs would be an indirect tax of 10% or $32 billion on mostly low- and middle-income households, increasing their cost of living through everyday purchases.
Trump also threatened a 25% tariff on Mexico and Canada. Getting Mexican President Claudia Sheinbaum on the phone with him and Canadian Prime Minister Justin Trudeau to travel to Mar-a-Lago and have dinner with him.
After each pair, as is his style, Trump tried to put a positive, winning twist on events. Regarding the discussion with the Mexican President, Trump posted on Social Truth, “I just had a great conversation with the new President of Mexico, Claudia Sheinbaum Pardo. She has agreed to stop migration through Mexico and into the United States, effectively closing our southern border. “It was a very productive conversation!”
The Mexican president denied this, posting on Twitter: “In our conversation with President Trump, I explained to him the comprehensive strategy that Mexico has followed to address the phenomenon of migration, respecting human rights. We reiterate that Mexico’s position is not to close the borders, but instead to build bridges between the government and the people.”
After Trudeau’s dinner, Trump said he had a “very productive meeting.” He also posted that “they discussed many important topics.” Trudeau told reporters he had a “great conversation” with Trump but declined further comment.
More than 83% of Mexico’s and 75% of Canada’s exports went to the US in 2023. US/Canada trade is valued at more than a trillion dollars; a 25% tariff alone would amount to about $130 billion in indirect taxes for Americans. Canada, the US and Mexico have a deeply intertwined supply chain system. The cost to all three countries would be heavy. And there’s Japan, China as a whole, the EU and the UK to consider. Given the nature of Trump it is impossible to predict what will happen, and it is even possible that this is one of Trump’s bluffs with which he hopes to extract concessions.
Wall 2.0?
Even if the threatened tariffs didn’t materialize, it would still be a bragging point for Trump about the fear it might instill. Entering Trump 2.0, the Mexican wall still hasn’t been built and Mexico hasn’t paid for it. We could have seen Wall 2.0 where his base gets some fun without any substantial results.
Newly announced tariffs 100% for BRICS
Now as this article is about to go to press, Trump has announced that he will impose 100% tariffs on them unless the BRICS – Brazil, India, China, South Africa, Iran, Egypt, Ethiopia and the United Arab Emirates – commit. to the USA. dollar as a reserve currency. This clearly takes things off the charts in the bullpen.
The new announcement now pushes things beyond the pale, it’s hard to see any strategy or bluff being constructively implemented here. The way it was done in a provocative social media post is appalling and would not be expected even from Putin. This new tariff threat further damages the credibility of the United States of America
eyes of the world, its neighbors, allies, trading partners and adversaries – the President-elect of the United States issues massive punitive decrees by “tweet”.
Among the pillars that have kept America true as the world’s reserve currency are its economic power, democracy, the rule of law, and its status as a leading member of the world community of free nations.
These are the very reasons that the BRICS system will not be a viable challenge to the US dollar’s reserve currency status anytime soon. Two of their most powerful members are run by dictators, their justice systems are heavily influenced by their political masters, and their liquidity is totally eclipsed by the depth of US markets.
Ironically, Trump is eroding the very pillars that have supported the US currency and its status as the world’s reserve currency: US democracy, the rule of law, and being fully committed to participation and cooperation with the community of free nations.
