Steve Forbes against tariffs, Trump’s trade war; to speak at West Chester on Saturday
The media mogul likes Trump's tax cuts, but not tariffs, which Forbes dubs a "sales tax."
Steve Forbes, GOP stalwart and publisher of Forbes magazine, will speak Saturday at West Chester University and plans to address the current debate about Republicans abandoning "free-market" economics under the Trump administration by embracing tariffs, which he considers akin to "sales taxes."
"Tariffs are a sales tax. And I'm not sure putting sales taxes on American consumers and businesses is the right way to redress very real grievances about trade abuses," Forbes said in an interview.
"I prefer a laser-like approach. We'll eventually see an agreement reached with the Chinese, a deal in which there will be zones for American companies in China where they can invest, put up facilities without local partners and forced transfers of technology. I wouldn't be surprised if we negotiate a multi-year agreement with China selling them LNG. They need natural gas, they get it from Russia and the Middle East. They'd like a third source."
The chairman of Forbes Media also said he prefers sanctions to tariffs.
"We should apply real sanctions" to free trade abusers such as Chinese telecommunications company ZTE. Trump dropped tariffs on ZTE, which had traded with Iran and North Korea in defiance of U.S. sanctions.
"ZTE did bad things. If we applied sanctions they'd be out of business. Instead, they paid a fine and changed their management and board," Forbes said. "We could have sanctioned their banks, or kicked them out" of the banking system, he said.
Forbes disagrees with the current approach of tariffs and says he has allies among other Republicans, such as Pennsylvania's Sen. Pat Toomey.
"He's very much a free-trader. Republicans don't like the trade abuses. We're having a skirmish, it's not a full-scale trade war. The [stock] markets believe an agreement will be reached in the next few months, otherwise it would have gone down 5,000-10,000 points," instead of several hundred points last week, he added.
Forbes also said he's against tariffs on goods from the European Union and other trade partners.
Tariffs on lumber and steel "are also sales taxes. I don't like new taxes. They hurt our users of steel and aluminum, and we should have learned from the early 2000s, when we did steel tariffs. We ended up destroying more jobs than we saved or created." That was an attempt to help West Virginia and other places, Forbes said.
"Thanks to deregulation and tax cuts, the U.S. economy is doing so well now we're having labor shortages. There's no need for tariffs. They end up hurting more than helping."
Forbes is in touch with Trump's chief economic adviser, Larry Kudlow.
"Kudlow believes in free trade. He sees these tariffs as a negotiating tool. He doesn't like them, but believes ultimately they'll disappear. He told me that before he went into the White House. If you listen to him speak, he makes it clear this is a pathway to agreements."
Otherwise, Forbes said, he's happy with the White House's "willingness to cut taxes. They have to do more on the personal side. And the deregulation. The massive amount of regulation we got in recent years was a crusher for manufacturing in the U.S."