r/economy • u/joe_shmoe11111 • 3d ago
The Blindingly Obvious Goal of Trump’s Tariffs That Everyone Seems to be Missing…
I keep seeing confusion about what Trump’s trying to accomplish with his new “tariffs on the world (except Russia, of course)” strategy.
Some have come up with partial truths, like him crashing the economy so that his billionaire friends can sell in advance, short the market then buy the dip, and further consolidating industries by knocking out small and medium sized businesses (eg. https://www.reddit.com/r/Political_Revolution/s/pjgB8tIqpW) and while those may be side benefits, it misses his BY FAR most important motive:
His goal with these tariffs is to force any corporations that want to survive to submit to his direct control & “buy” his favor (a, by definition, fascist takeover FWIW).
This is classic mob boss “carrot & stick persuasion” tactics & they are terrifyingly effective.
By imposing mixed levels of industry and country-specific tariffs & making it clear that these are all being imposed (& removed) at his will, Trump is able to dramatically (& immediately) influence nearly every company’s relative costs & competitiveness.
Within an astonishingly short period (likely just a matter of weeks or months) this financial control will force even the largest companies to submit to his demands in order to get the specific tariffs driving up the cost of *their* products & supply chains reduced or removed. Those who don't play by his rules will end up having to charge more & profit less, & will eventually be driven out of business by the competition that does play along.
With this latest move, he’s given the CEOs & board rooms of America a very clear, stark choice:
Do whatever he says (likely including in the long term purging your company of anyone who publicly opposes him & no longer advertising on platforms that allow opposition messaging), publicly praise him and “donate” millions to his “campaign" (for a 3rd term?), and the tariffs that most directly affect your bottom line will be magically reduced or removed overnight.
Do anything he doesn’t like, in contrast, and he’ll reimpose or increase them instead.
His calculus is simple:
He’s got another 3 1/2 years of executive power, minimum (you’re dreaming if you think BOTH the Republican-controlled house & 2/3rds of the Senate would ever vote to remove him, and even if they did, Vance would likely just continue with these tactics).
Most CEOs can only survive a year at most of continually losing market share to the competitors that are willing to pay to play before they’ll be replaced by someone more compliant.
This means that by the 2026 midterms, any remaining corporate opposition will be substantially weakened and on its way out the door. By 2028, they will be utterly marginalized or gone.
For anyone who thinks this is alarmist, you only have to look at the brazen effectiveness of his most recent targeted attacks via executive order on the nation’s largest law firms.
Law firms that had previously participated in cases against him (or his cronies) have been individually named and prohibited from entering federal buildings (obviously a necessity to participate in federal court cases), had their security clearances threatened and been banned from working with federal agencies (often a multimillion dollar portion of their business).
The result?
One by one, and within just a few weeks, they’ve ALL bent the knee and not only dropped the cases they were working on, but also “donated” tens of millions in free legal work for organizations that Trump likes in order to get his executive orders reversed (successfully, btw). Understanding the clear intended message of these targeted attacks, many of the other big law firms have already announced plans to preemptively bribe (er, provide) him with over $100 million in pro bono services(!):
https://www.cbsnews.com/news/trumps-big-law-firms-retribution/
FWIW, this has been Trump’s MO forever, so no one should be surprised. He has always used his outsized wealth and power to bully others into doing his bidding. Whether it’s stiffing small contractors out of millions after they’ve done all the work, then burying them in legal debt when they try to complain until they've commit suicide (https://www.wsj.com/articles/donald-trumps-business-plan-left-a-trail-of-unpaid-bills-1465504454) or publicly humiliating fellow Republicans into complete submission (eg. Lil Marco Rubio, Lyin' Ted Cruz, etc), this is simply how he operates.
This is all out of the Dictator’s handbook, of course, and it’s why our founding fathers designated the power of the purse to congress instead of the president alone. Unfortunately, congresspeople are far too cowardly to assert their rightful power and will passively watch our democracy die long before they do anything about it. It seems highly unlikely that any company can resist this type of targeted coercion long term.
How we the people respond will determine whether the country we grew up in still exists in recognizable form just a few months from now.
TL,DR: The “emergency” powers Trump currently has allow him to start, stop and dramatically alter international tariffs at will.
Given his extensive record of abusing power for personal gain (as demonstrated recently by him sabotaging individual law firms’ ability to conduct business with individually targeted executive orders, forcing them to not only stop all work on cases against him and his cronies, but also give him hundreds of millions of dollars in free labor in order for him to rescind them. These orders caused other law firms to preemptively offer him hundred million dollar bribes as well).
I’m suggesting that he is likely to abuse his power again, effectively controlling many companies’ ability to compete depending on their compliance with his demands. By suddenly raising and lowering tariffs by large amounts (currently 50% in some cases, and there’s no reason he can’t go higher to make a point), he can attack individual companies’ respective weak points and sabotage their operations, making them consistently less competitive. He can also pair this with reduced tariffs on their rivals, making them MORE competitive. He can thus pit them against one another, consistently punishing the least complaint and rewarding the most compliant to strengthen their hand.
Because most companies legally exist to maximize shareholder profits, this will eventually force them to either acquiesce to his demands (no matter how extreme, eg. Demanding they replace employees he dislikes with people he does and participate in crimes) or be forced out of business, leading to what’s commonly known as a fascist state.
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u/High_Contact_ 3d ago
You guys are giving these people too much credit. He’s just an idiot.