Ex-Commerce Chief Says Trump Tariffs Could Damage U.S. Economy
(Bloomberg) -- The tariffs on steel and aluminum levied by President Donald Trump could damage the U.S. economy and set off trade wars with American allies, according to former commerce secretary Penny Pritzker.
“The European Union has come out and said they’re going to go after our bourbon, Levi’s and Harley-Davidson because they all feel very targeted,” Pritzker said in an interview following a speech at the University of Michigan. “What happens to a relationship when you poke somebody in the eye? Will we get past it? Will there be lasting memories? We’re going to have to see.”
Pritzker, who led the Commerce Department during President Barack Obama’s second term, said tariffs of 25 percent on steel and 10 percent on aluminum could drive up prices and displace thousands of workers, echoing arguments made by business leaders as well as members of the president’s own party. Pritzker, a billionaire businesswoman who founded PSP Capital Partners, in a column on CNBC urged Trump to work with U.S. allies in the European Union, North America and Asia to pressure China to stop its over-production of steel, aluminum and semiconductors.
Pritzker said Friday she found the president’s policy “hard to understand” because it could have such profound unintended consequences.
“It doesn’t feel like we’re addressing the problem, which is China,” she said. “And American businesses, soybeans and others, will pay the price. We have 140,000 steel workers and 6.5 million people who work in industries that use steel.”
The Trump Administration justified the tariffs as necessary for national security, a claim Pritzker said may not stand up to legal scrutiny.
“There’s evidence that this may not be a legitimate way to bring tariffs,” she said. “So then we’ve got retaliation without any benefit.”
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