Tariff Turmoil: Overreliance on distribution instead of growth

The unilateral declaration of reciprocal tariff by President Donald Trump on trading partner countries has unfolded myriad uncertainties heightening the geopolitical and economic tensions. Immediate reactions were reflected in the global stock markets trading on negative levels. The full repercussions will be known in a couple of years. The IMF has forecast a downward economic growth for the USA.

- BY JAYASRI PRIYALAL

Prof. Jeffrey Sachs, Economist and Professor at Columbia University, who is critical of President Trump's decision, argues that even in this turmoil few billionaires who are close to the Trump administration would have made a killing. The erratic market fluctuations are real opportunities for those who aspire for state and regulatory capture in the current context. They cash on pains and losses of millions and gain handsomely. That is their business. Quickly recouping the money spent on election campaigns with the help of information asymmetry.

The mythical beliefs of ownership society benefitting out from trickle down effects remains pie in the sky. Blind faith in the neo-liberal order has not ushered any worthwhile progress to billions of people struggling to meet their ends, fighting for a dignified upward social mobility in search of better quality of life. Instead, the neo-liberal doctrine aligned with market fundamentals practiced for decades have widened inequality in income, wealth, education and healthcare in strong economies and in the developing countries.

Thus, in many democracies the hopeless and helpless citizens are electing extreme rightor left-wing populist governments into power for alternative policy options in the absence of any other choice. As for many, hope is the antidote for fear. It appears that many who secure electoral gains lack original thinking for better alternative policy options to stimulate growth in the sagging economies pickled with debt, including the USA. Instead of sticking to the same old failed economic policy options for survival.