Tariffs Remain. Target China.

First and importantly, House conservatives rejected the Senate budget plan last night. House Leadership attempted to get the conservatives on board, but the conservatives have legitimate concerns about spending and attempts to reduce the deficit. The Senate plan, as presented, would grow the national debt over the next decade to $50 trillion. Relatedly, yesterday, the bond yield spiked rapidly and significantly, which could put crazy pressure on the budget by making debt service payments more expensive.

If you are a regular reader, you knew on Monday morning before sunrise from this very email that Trump would pivot to pause tariffs claiming so many countries want to negotiate there needs to be a pause.

As I said at the time and maintain based on the same person who woke me up before 6am to tell me this was happening, it is not some Art of the Deal, but because of the market fall out. The investors who funded his campaign went nuts on Sunday as the futures and Asian markets opened. The bond market went nuts on Tuesday and into Wednesday signaling other nations were jettisoning our bonds to drive up the cost of our debt maintenance as a way to hurt us. It should be noted the President himself told reporters yesterday he made his decision after seeing the markets over the past few days and saw the bond market getting “yippy,” in his words.

So it happened.

Contrary to some confused initial reports, the 10% baseline tariffs remain, putting our tariffs higher than any western country. The sector tariffs, including on automobiles remain and pharmaceutical tariffs are coming shortly. Combined, we now have tariffs higher than during the Smoot-Hawley era and that is even before adding in those tariffs that remain on China. Every major economist, except the Modern Monetary Theory economists who gave us Bidenomics style inflation, recognize Smoot-Hawley prolonged the depression. I have a suspicion that when Wall Street realizes the baseline and sector tariffs are not paused, we may get more market turmoil.

But, this is a pivot in the right direction.

Now, it is time to get our allies on board a targeted economic attack on China.

The President is right to keep the tariffs on China and he is right to escalate. The Chinese cannot be trusted, should not be trusted, and must be taken on relentlessly. They cannot be accommodated under their present leadership.

China is a nation in decline, which makes it both more dangerous and more necessary to contain.

If the President is really serious about taking on China, he needs to shut down TikTok now. Stop humoring the whims of a few major GOP donors on TikTok. You’ve given those same people a pause on most tariffs. So shut down the Chinese surveillance system that is TikTok.

Additionally, consider deporting Chinese nationals here in the United States on student visas, many of whom operate as agents of their state.

The time is right to unite Western allies and Southeast Asian nations against China’s desire for global hegemony.

Lastly, thank you Mr. President, from the bottom of my heart, for taking on the issue of shower heads and water pressure. It sounds silly, but the leftwing desire to inconvenience Americans needs to end. This, and the regulatory rollback on dishwashers, washing machines, etc. is needed. But Congress should make it permanent.