The Tariffs Are Here. Inflation Isn’t. What Gives?

Over the course of April, President Donald Trump imposed large tariffs on goods from every country in the world, pushing America’s average levy on imports to its highest level in roughly a century. And inflation slowed.

In April, the Consumer Price Index (CPI) rose at a 2.3 percent annual rate, its slowest pace since early 2021, according to a federal report released Tuesday morning. Economists had expected that figure to be 2.4 percent. Markets rallied on this happy surprise.

Meanwhile, the Trump administration lowered its tariffs on China on Monday, bringing its levy on Chinese imports down from 145 percent to 30 percent for 90 days, as the two countries work toward a permanent agreement. China, in turn, lowered its retaliatory tariff on American goods from 125 percent to 10 percent. Americans might look at these two developments and wonder: Does this mean the economy is going to be fine? Is Trump’s manufactured economic crisis ending before it even began?

No one can answer these questions with certainty. What we do know is: [1] Trump’s trade war is still poised to raise prices and slow growth later this year. [2] The risk of a severe economic crisis has fallen significantly. – Vox

Our Take: These headlines were hilarious on Tuesday:
Note: Economists assured us that inflation was going to skyrocket. Trust the experts.
Sorry, that thing we told you was a coming crisis is actually not happening. But stay scared, everyone!

The very smart economists that convinced you Biden’s economy was strong – and totally not in recession despite real GDP continuing to shrink – are now telling you that Trump’s economic results aren’t real.

Vox assures us that, “Tariffs reliably increase consumer prices. When companies are forced to pay higher prices for foreign goods and imports, they generally pass on at least part of that cost to their customers.”

But tariffs are part of President Trump’s economic agenda – not all of it. And Secretary Bessent keeps explaining that these different levers of American profitability are working in concert with each other.
President Trump’s economic reform agenda – to ignite the American economy and restore American wealth – is a three-legged stool, as Bessent laid out in the clip above from April:

Cut spending intentionally, avoiding a recession.

Deregulate to jump start the private sector.

Reorder international trade (tariffs, etc.) and bring back manufacturing.

"The U.S. doesn’t have a revenue problem—we have a spending problem,” the Treasury Secretary said.

The Trump economy isn’t going to do what the decades-long globalist/Keynesian fever dream did, because the levers are different. Trump’s levers put America First and, perhaps more importantly, they’re strategic and based on theories of sound money and market economies rather than social justice theories and hopium about solving human nature with theoretical abundance.

Vox and the other media outlets will keep correcting the record (and, eventually, apologizing as we’re seeing with the Biden decline rerun now) for misleading their audiences with baseless and aggressive fear porn.

This is so much fun. – Ashe in America

https://open.substack.com/pub/badlands/p/badlands-news-brief-a64?r=4t5cs3&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false