Former Treasury Secretary Larry Summers criticized President Donald Trump’s claim that Canada is inciting a trade war, telling CNN Monday that the move would ultimately benefit China.
“It’s absurd,” Summers said. “Canada is our friend. Canada is not an important source of illegal immigrants. Canada is not an important source of illegal drugs. Canada is an important market for American products. Canada is a crucial co-producer with American automobile companies that enable North America to compete with Asia and Europe.”
He continued: “This whole policy is of the ‘stop or I’ll shoot myself in the foot’ kind. It represents a self-inflicted supply shock, a wound on the American economy. It is very dangerous. The major winner will be Xi Jinping,” he said, referencing the president of China.
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“We are, with our tariffs on China, giving him [Xi Jinping] an excuse for their poor economic performance and ability to blame it on us, because by alienating all our traditional allies and creating uncertainty about whether we can be relied on, we’re driving people into China’s arms.”
He said that Americans would likely feel an impact from the tariffs “very rapidly” — within weeks.
“The effect of all of this is just going to be that every other country in the world, if we were prepared to do this with Canada, is going to view us with much more suspicion. They’re certainly not going to do anything voluntarily generous for us if they expect to be extorted in the near future in this way.”
He continued: So it’s pretty rare, actually, to be able to formulate a policy that’s lose for American consumers, lose for American producers, lose for American influence in the world, and only is benefiting our adversaries who are getting a great deal of satisfaction out of seeing this spectacle of traditional alliances being torn apart with these kinds of threats.”
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