Trump's Tariffs: Look At America's Ports, Not the Stock Market

The stock market is still down thousands of points since its peak in January and millions of everyday Americans have seen their 401(k) and retirement accounts savaged thanks to the Felon's tariff pronouncements.  Yet, as a piece in The Atlantic notes, perhaps a better gauge of the damage done - and still to come - by the malignant occupant of the White House is what is happening in America's ports, including locally in the Port of Virginia here in the Hampton Roads area.  For now, the worse impacts are on the West Coast ports where traffic is down an estimated 35% with further declines likely to come.  This reduction in port traffic from China in particular signals not only disruptions in the supply chain - the Felon has stated children can get by with fewer dolls for Christmas - but also the vast transportation network (and related jobs) that carry goods across America. Sadly, the Republican controlled Congress has refused to rein in the Felon's irrational and mercurial tariffs and utterly failed to assert its own power and authority.  Personally, I hope the tariff nightmare continues for long enough to have the Walmart shopping MAGA base experience both higher prices and empty shelves and just maybe come to the realization that the Felon cares nothing about them.  Here are article highlights:

Stock markets plunged for days after President Donald Trump announced steep tariffs on imports from around the world. The sell-off ebbed only when he suspended most, but not all, of the new measures for 90 days. The ticker tape is just one indicator of an economy, and other signs are growing more and more ominous—including at the Port of Los Angeles, where high tariffs on China are crushing maritime traffic. “Essentially all shipments out of China for major retailers and manufacturers have ceased,” Eugene Seroka, the executive director of the port, said on April 24.

Trump views tariffs as essential to rebuilding the manufacturing economy that the United States once had. But his erratic tariff announcements have badly disrupted the economy that the country has today, and that pain is already being felt in the world of logistics. . . . . “The tariffs themselves are a shock to the system, and the shock is echoed and amplified across the entire chain. Even if there is resolution, it will take nine to 12 months to work out these bumps.”

The Port of Los Angeles, the busiest in the Western Hemisphere, processes about 17 percent of everything the United States imports or exports in shipping containers. The adjoining Port of Long Beach accounts for another 14 percent. Over the years, a whole ecosystem has arisen to support the loading and unloading of the cars, clothes, electronic gadgets, and other things that people want. There are workers and warehouses, trucks and loading pads, security structures and rail lines.

Seroka estimated that cargo arrivals would soon be down 35 percent over the same time last year. At the moment, the drop in traffic seems likelier to accelerate than to reverse. . . . . The economy, and the supply chains that allow it to function, can adjust fairly quickly to certain shocks, including weather disasters and even a pandemic. . . . . But Trump’s trade war is different because it is unpredictable and indefinite. Even if he were to renounce tariffs tomorrow, Trump has already shaken global confidence in American economic-policy making. No one can comfortably make business decisions based on what he does. Unless the Republican-controlled Congress steps in to quickly take away the president’s ability to impose import duties at will, a failed effort so far, even foreign trading partners who believe they have a deal with the United States could be at risk of capricious new taxes on their products.

Tariffs don’t just reduce the flow of goods coming into the country; they also cause an atrophying of the logistics system that moves products into, out of, and around the United States. “Less cargo volume, less jobs.

Like the shipping business into and out of Los Angeles, the nationwide trucking industry is slowing down, because drivers have a lot less cargo to move. Without inventory arriving or en route, small businesses will falter; bigger industries will shrink; shelves will be empty.

This week, Trump blamed former President Joe Biden, rather than his own policies, for the recent turmoil on Wall Street. What’s happening in Los Angeles suggests that, if anything, financial markets have yet to fully price in how much Trump’s tariff war is hurting the economy. The stock market goes up and down. Maritime indicators keep on sinking.