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Alex Durante: Federal Tax Economist on Donald Trump's tariffs, the trade war · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: It's August the first. Yes, the deadline is here for
• 0:03
  Speaker 1: Trump and his tariffs, but the rest of the world
• 0:06
  Speaker 1: and New Zealand will be waiting probably another twenty four
• 0:09
  Speaker 1: hours before we get news from the White House and
• 0:11
  Speaker 1: exactly what we will pay. The White House has already
• 0:14
  Speaker 1: shaken hands with a few countries Japan, the EU, South Korea, Indonesia,
• 0:18
  Speaker 1: the UK. They're all getting lower rates, but others are
• 0:21
  Speaker 1: not so lucky. India you're looking at twenty five percent tariff,
• 0:23
  Speaker 1: Bangladesh thirty five percent, Brazilla whopping fifty. Canada have said
• 0:28
  Speaker 1: they're unlikely to reach a deal before the deadline. Mexico
• 0:31
  Speaker 1: Overnight has been extended. Alex Deronte is a federal tax
• 0:35
  Speaker 1: economist at the Tax Foundation in the US and joins
• 0:38
  Speaker 1: US now. Alex, welcome to the program. Nice to have
• 0:41
  Speaker 1: you here, Hi, thanks for having me. When do we
• 0:45
  Speaker 1: find out? When does the world find out exactly what's
• 0:47
  Speaker 1: going on and what that base rate might be?
• 0:52
  Speaker 2: I think I think we're going to be staying up
• 0:53
  Speaker 2: late and waiting until until midnight to see what actually happens.
• 0:57
  Speaker 2: I mean over here as a tax foundation, it is
• 1:00
  Speaker 2: quite on starry, even for us on what rates some
• 1:02
  Speaker 2: of these countries are going to be facing. You know,
• 1:05
  Speaker 2: right now most countries are facing a ten percent universal
• 1:09
  Speaker 2: baseline tariff that includes Australia and New Zealand. But the
• 1:13
  Speaker 2: President has indicated sort of over the past month that
• 1:17
  Speaker 2: he has interests I think in moving that baseline tarer
• 1:20
  Speaker 2: higher to somewhere between fifteen and twenty percent. So I
• 1:25
  Speaker 2: think altogether consumers and businesses should be bracing for higher
• 1:30
  Speaker 2: tariffs and higher prices for sure going forward.
• 1:33
  Speaker 1: Do you yet but higher than the team saint? Do
• 1:35
  Speaker 1: you think he will up that vice.
• 1:37
  Speaker 2: Right right now? I mean we're hearing as I said,
• 1:43
  Speaker 2: this is all speculative, of course, but you know, somewhere
• 1:46
  Speaker 2: either fifteen percent or twenty percent. If all of the
• 1:51
  Speaker 2: reciprocal tariffs go into effect tomorrow as scheduled, that would
• 1:56
  Speaker 2: move the average apply tariff rate to just over twenty percent.
• 2:02
  Speaker 1: Which big countries, big trading partners of Americas do you
• 2:06
  Speaker 1: think should be most concerned?
• 2:10
  Speaker 2: Well, so let's see here, So the president was he
• 2:13
  Speaker 2: had well, he announced higher rates on Canada and Mexico.
• 2:18
  Speaker 2: Both of those countries are currently paying or rather our
• 2:21
  Speaker 2: consumers to import those goods are paying a twenty five
• 2:24
  Speaker 2: percent tariff, and the Kada rate is scheduled to rise
• 2:28
  Speaker 2: by ten percentage points to thirty five percent tomorrow, and
• 2:31
  Speaker 2: the Mexico tariff was scheduled to rise to thirty percent,
• 2:35
  Speaker 2: but the President announced a ninety day pause on that
• 2:39
  Speaker 2: increase in that tariff rate. Kevin, I would also add
• 2:42
  Speaker 2: that we need to be concerned about the EU. The
• 2:45
  Speaker 2: President did announce that he would be imposing a fifteen
• 2:49
  Speaker 2: percent tariff on those imports as part of the of
• 2:53
  Speaker 2: the deal that is being currently negotiated right now. And
• 2:58
  Speaker 2: then finally, the highest of these parap rates are the
• 3:01
  Speaker 2: rates that we're opposing on Chinese imports, which August twelfth
• 3:06
  Speaker 2: are scheduled to rise to one hundred and twenty five percent.
• 3:11
  Speaker 2: So really it's the EU, Mexico, Canada and China we should,
• 3:16
  Speaker 2: you know, continue to be watching house.
• 3:18
  Speaker 1: Americans are obviously watching this as closely as we are.
• 3:21
  Speaker 1: What are they thinking about the fact that he's going
• 3:23
  Speaker 1: to be potentially upping this and he's doing it to
• 3:25
  Speaker 1: friends and allies and it doesn't seem to matter.
• 3:29
  Speaker 2: Right Well, I mean, I think, as I said earlier,
• 3:33
  Speaker 2: you know, I think consumers have been so you know,
• 3:36
  Speaker 2: businesses have been somewhat fortunate so far, although you know,
• 3:40
  Speaker 2: we're although they're paying much higher tariffs than they did
• 3:42
  Speaker 2: last year. You know, the President did delay you know,
• 3:46
  Speaker 2: these reciprocal tariffs for for a few months, but unfortunately,
• 3:50
  Speaker 2: you know, it does seem that the President is dead
• 3:52
  Speaker 2: set on implementing a host of them tomorrow and that
• 3:56
  Speaker 2: is going to likely have significant impacts on prices over
• 4:01
  Speaker 2: over the coming month.
• 4:02
  Speaker 1: Alex, appreciate your time, Thanks so much for being with us.
• 4:05
  Speaker 1: It's Alex Deronte. He's the federal tax economist at the
• 4:08
  Speaker 1: Tax Foundation over in the United States, and so our
• 4:11
  Speaker 1: gut of the word from our officials over in Washington
• 4:14
  Speaker 1: is that that base ten percent will stay, but that
• 4:18
  Speaker 1: Trump is the ultimate decision maker and he can do
• 4:21
  Speaker 1: what he wants. And Alex is telling us there he's
• 4:23
  Speaker 1: hearing it's going to fifteen or twenty. So basically when
• 4:26
  Speaker 1: none the wiser at this point in the in the day.
• 4:30
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• 4:33
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• 4:36
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