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CPA Op-Ed: Study Says Trump Tariffs Create 20 New U.S. Jobs for Every One Lost

September 10, 2018

Late-night news comic John Oliver recently gave a 20-minute talk about President Donald Trump’s use of tariffs. As always, he was very funny, but he made a few mistakes in his analysis of trade.

Op-ed by Jeff Ferry originally appeared in LifeZette on September 7, 2018

The Coalition for a Prosperous America (CPA) would like to help provide a better understanding of the issue. To start with, Oliver said that Americans will pay for the tariffs imposed by the president.

That’s exactly what’s happening with Huawei right now in solar inverters. The Chinese manufacturer would like to dominate the U.S. market for inverters. Huawei has close links to Chinese military intelligence and has received billions of dollars in Chinese government subsidies.

As a result, Huawei has been banned by the Pentagon from selling internet equipment in the U.S. A couple of years ago, its engineers were caught stealing test equipment from T-Mobile’s lab in Seattle.

So now Huawei sells smartphones in Best Buy. The Chinese firm recently claimed its new Nova 3i takes the best selfies you can take with a smartphone. The only problem was the selfies weren’t actually taken with a Huawei Nova 3i.

They were taken with a $5,000 Canon DSLR camera. So now, Huawei is thinking of pulling its government-subsidized inverters out of the U.S. market. That would leave the market to two U.S. manufacturers, SolarEdge and Enphase.

Oliver also said that tariffs would cause job losses in the future, and he quoted some horrendously large figures. There’s an old saying in the economics profession: “Economists don’t make forecasts because they’re good at it, they make forecasts because they get paid to do it.”

In fact, the CPA has done the only accounting of actual committed job gains and losses from the Trump tariffs so far. What we’ve found is that the tariffs have created 11,000 U.S. jobs and eliminated just 514. That’s a 20 to 1 ratio in favor of jobs created by tariffs.

Job creation makes sense because tariffs stimulate domestic production. That’s what they’re designed to do. It’s really not hard to understand that.

Oliver tried fact-checking the president, too, saying he was dreaming when he quoted a figure of $800 billion for America’s trade deficit in 2017. In fact, Trump was referring to the U.S. goods deficit, which was $807 billion last year.

Like Trump, many Americans are concerned with goods trade because more jobs are created by making goods than by producing services. In fact, economists estimate that each $1 billion added to our trade deficit means an additional 6,000 jobs lost. So the $552 billion overall trade deficit in goods and services that Oliver identified accounts for about 3.3 million American jobs lost.


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