Business News – Jan 25, 2025

1 - Trump's Trade Scam – The basics

In the paragraph you provided, the term "Trump's Trade Scam" refers to criticism of former President Donald Trump's trade policies, particularly his proposal to create an "External Revenue Service" (ERS). This proposal has been labeled a "scam" by critics who argue that it misrepresents how tariffs work and who ultimately bears their cost.

What is "External Revenue Service"

In January 2025, President Donald Trump proposed the creation of a new government agency called the External Revenue Service (ERS). The purpose of this agency would be to collect tariffs, duties, and other trade-related revenues from foreign sources. This initiative is part of President Trump's broader trade strategy, which emphasizes imposing tariffs on imports to generate revenue for the United States.

Key Points:

• Tariffs and Duties: Tariffs are taxes imposed on imported goods and services. The idea behind the ERS is to have a dedicated agency responsible for collecting these tariffs and duties from foreign entities that trade with the U.S.

• Revenue Generation: President Trump argues that by collecting tariffs through the ERS, substantial funds would flow into the U.S. Treasury, thereby benefiting the American economy.

Criticisms and Considerations:

• Economic Impact: Economists have raised concerns that imposing higher tariffs could lead to increased costs for American consumers, as importers might pass on the additional expenses. This could result in higher prices for goods and potential trade tensions with other countries.

• Implementation: Establishing a new federal agency like the ERS would require legislative approval from Congress. As of now, it is uncertain whether there is sufficient support for this proposal.

In summary, the External Revenue Service is a proposed agency aimed at enhancing the collection of trade-related revenues from foreign sources. While intended to bolster the U.S. economy, the proposal has sparked debate regarding its potential effects on consumers and international trade relationships.

Understanding the "External Revenue Service" Proposal:

• What is the ERS? President Trump proposed establishing a new government agency called the External Revenue Service to collect tariffs, duties, and other trade-related revenues. He suggested that this agency would generate substantial income for the U.S. by taxing foreign entities.

• Criticism of the Proposal: Economists and analysts argue that this proposal is misleading. In reality, tariffs are paid by domestic importers—U.S. companies that bring foreign goods into the country—not by foreign producers. These importers often pass the increased costs onto American consumers through higher prices. Therefore, the burden of tariffs falls on U.S. businesses and consumers, not on foreign entities.

Why Call It a "Scam"?

Labeling the proposal as a "scam" suggests that it is deceptive. Critics believe that presenting the ERS as a means to collect revenue from foreign sources misleads the public about who actually pays for tariffs. By implying that foreign producers bear the cost, the proposal obscures the fact that American consumers and businesses are the ones who ultimately pay higher prices due to these tariffs.

Conclusion:

The term "Trump's Trade Scam" reflects the viewpoint that the proposed External Revenue Service misrepresents the economic impact of tariffs, leading to misconceptions about who bears the financial burden. Critics argue that such policies, rather than benefiting American consumers, may actually result in higher costs for them

2 - Trump’s Trade Scam

Stephen S. Roach. Project Syndicate. Jan 24, 2025

Donald Trump’s second administration is starting where his first ended – with distortions and convoluted logic. Perhaps most notable is his ludicrous proposal for an "External Revenue Service," which, contrary to the president’s claims, would collect tariff revenues from domestic importers, not from foreign

Episode 3924 - Jan 26 - Tiếng Anh - Tin Kinh doanh – Ngày 25 tháng 1, 2025 - Vina Technology at AI time

Vina Technology at AI time - Công nghệ Việt Nam thời AI

Episode 3924 - Jan 26 - Tiếng Anh - Tin Kinh doanh – Ngày 25 tháng 1, 2025 - Vina Technology at AI time