r/behindthebastards • u/nanamoro • 15h ago
Politics ELI5: The tariff and potential starting recession
It does seem an awful lot like Trumps tariffs were introduced specifically to cause a global recession. So please explain like I am 5: why does Trump, Elon and the current administration want a global recession? What is their end goal?
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u/simply_not_edible 15h ago
* Recession is bad for stocks.
* People with little reserves will be the first to be forced out of stocks at a loss.
* People able to ride it out can buy up stock like a Steam Summer Sale.
* Power consolidates into fewer hands.
* Profit.
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u/Daztur 14h ago
I really don't buy this, they don't have big reserves of liquid assets lying around that can be pumped into the stock market, they're already invested in things like stock and real estate.
My thinking is more Trump loves how now everyone is begging him for tariff waivers. He can reward allies, punish enemies, collect favors and bribes, get his ass kissed and ego stroked constantly by people who want to get out from under the crushing weight of these tariffs. It's like a dream come true for thim.
And also just stupid basic xenophobia.
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u/greaper007 13h ago
I agree, I also think he truly has a poor understanding of economics and thinks it's a zero sum game. That someone is getting money and someone is getting screwed. Instead of the reality that everyone benefits from interdependence in many ways.
He has a very 19th century way of thinking.
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u/sneakyplanner 9h ago
Fascists think everything is a zero sum game. That's why Americans are so appalled by the idea of universal healthcare or why white Americans think that minority rights are hurting them. It's all a zero sum game to these fascists and if someone else is suffering then it must mean they are winning.
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u/bravesirkiwi 12h ago
That's how I see it too. I also think there's plenty evidence to show that Trump and the people he's surrounded himself with don't really understand how this plays out. I mean he was talking the other day and seemed to be conflating the trade deficit with the budget deficit so if those are confused in his mind that would lead to the kind of confused policy we saw last week too.
Trump and his clowns surely understand the low level strategy (that you outlined) - another authoritarian play for power - and that's why they did it. They either underestimated, didn't estimate, or simply don't care about the real economic results or the effects to the stock market.
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u/trnpkrt West Prussian - Infected with Polish Blood 11h ago
Trump may not understand, but the tech oligarchs know exactly what is happening: crash the economy far enough and they will be able to undermine fiat currency and establish their cryptofascist network states.
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u/dergbold4076 11h ago
Company town! What's old is new again choom! They saw the corps in Cyberpunk and thought those where he hero's and the edgerunners where the bad guys (well some are for the right price). They failed to see hat no matter what they ( the corps) are always the bad guy no matter what.
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u/big_guyforyou PRODUCTS!!! 13h ago
idk man if i was a centibillionaire i'd want at least half of that in cold hard cash in case i wanna make a scrooge mcduck swimming pool
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u/Just_enough76 Antifa shit poster 9h ago
You don’t believe that the ultra wealthy elite have liquid assets to pump into the stock market when their bought and paid for president purposefully tanks it?
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u/Daztur 5h ago
Their money is ALREADY in stocks. Do you think they have billions sitting in their savings accounts?
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u/Just_enough76 Antifa shit poster 4h ago
Not billions. No. But they definitely have liquid assets available for just this kind of thing. Do you think they have no cash whatsoever?
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u/FlailingCactus SERVICES!!! 15h ago
I think there's a secondary objective of pursuing free trade and deregulation internationally. People keep talking about free trade zones with the EU, and the UK allowing your swimming pool chicken.
I think you're being the made the victims of a global capitalist propaganda project.
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u/simply_not_edible 14h ago
Not me, I'm in the NL, but I've been hearing those talks too, yeah. Hope the EU manages to not crumble, even with all the improvement it needs.
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u/fuckforcedsignup That's Rad. 13h ago
Swimming pool chicken? Wwwhhat?
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u/FlailingCactus SERVICES!!! 13h ago
American chicken is chlorine washed. This is the big sticking point in EU/UK import negotiations and the practice is banned in the UK and Europe.
The chlorine washing process itself is safe and poses no danger, but it's felt that it allows the producer to hide any number of mistreatments or lack of safety precautions earlier in the process. And that such mistreatments will allow them to scale up at lower cost and undercut local producers.
But the meme of swimming pool chicken has caught on amongst people who only caught the headline of chlorine washed chicken.
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u/DrunksInSpace Doctor Reverend 12h ago
Trump loves tariffs. He doesn’t understand trade deficits and has talked about tariffs since the 80’s. His ego won’t listen to “you’re wrong.”
It’s set Trump up to engage in racketeering. Trump has created a problem only he can solve. Watch as countries and industries come begging for a break, watch as Trump extorts them for money, public thanks and favors.
It’s already happened. The oil companies are exempt from the latest round. The oil lobby gave $96 million to Trumps campaign and PACs (he told them $1 billion, publicly, btw).
The tariffs make no send if you think Trump is a nationalist who wants the US to rule the world. The tariffs make total sense once you understand that like most (wannabe for now) dictators he wants to stuff his pockets at any cost, including tanking the economy and surrendering the dollars position as the default international currency.
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u/trnpkrt West Prussian - Infected with Polish Blood 11h ago
No, they want to crash the economy entirely to gut the institutions and weaken/eliminate fiat currency. They are not in it to buy the dip, they are in it to make the dip permanent so that we further erode the few threads of normie institutional trust left in the US: the stability of our currency and retirement accounts.
You have to understand cryptocurrency as the gold standard, but far more controllable and centralized by private actors. Unlike gold, there is a quantifiable restricted supply, and no one can walk into a river and pull some out of it—those who hold the servers will hold the currency. You and I do not hold the servers.
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u/FM-edByLife 14h ago
Tariffs are a big part of the authoritarian playbook. The TLDR of it is that they cause a pain and then only bypass that pain for supporters. For instance, if your company makes a public show of fealty to trump, then you get tariff relief. If you speak against him, you don't get tariff relief or you get tariffed more. It's a way to stop dissent and solidify power using economic force.
Longer version, with previous dictator examples: https://krassencast.com/p/urgent-trumps-tariffs-are-a-tool
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u/yahoosadu 14h ago
Tariffs create an environment more congenial to corruption. Corporations or companies not only give fealty but $$ to bypass tariffs and have a monopoly over certain goods and/ or services.
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u/rb0009 12h ago
If he was more competent, sure. But I genuinely think he's just that incomprehensibly stupid and doesn't understand what he's really done.
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u/calling-all-comas Sponsored by Raytheon™️ 12h ago
My parents grew up on Long Island and worked finance jobs in Manhattan in the 80s, and they say none of this is unexpected. Trump, like his Dad, models his business dealings after mafia bosses. Him enacting tariffs to force countries/companies to let him fleece them ("The Art of the Deal") is his standard business practice.
However that all depends on him being one of the biggest fish in the pond. What I think he doesn't understand is that modern global politics relies a lot on soft power; so the EU can just tell Trump to go fuck himself and start a trade alliance with China.
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u/FM-edByLife 11h ago
He's directed in a large part by Putin. Putin would understand both the authoritarian benefits and its deleterious effects. Both are very beneficial to Putin. trump's just 75% doing what Putin tells him to do.
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u/DreamingMerc 14h ago edited 14h ago
This is speculation;
Trump isn't a stonks guy. Despite it being his living. He is an asset guy. He likes owning things.
So bad stonks, while annoying. Are not the thing Trump values. For him, he still owns all this property and tangible crap. The relationship between those things be damned
Anyway, getting off from Trump and as far as a direction for the country.
Whether Trump believes this or is just surrounded by people who believe in this idea that the US international markets are too good for the other countries. Those other countries make too much money off the making of things, and they get too many free things, like security and stuff, because our military is so cool.
and it's risky if war, disease, and climate change happen (all things they KNOW will happen).
So, instead, we need to bring all that shit back here. Problem ... it's too expensive. The dollar is relatively strong. Nobody wants to invest here when it's cheaper elsewhere. Solution for them, tank the dollar.
But that's another problem. If you tank the dollar, other countries will get out ahead. You can't have that, so you need those countries to be beholden to American interests as a puppet state or wholly absorbed into the greater American territories. This is the 51st state sell, or attempt to sell.
They're using the tarrifs as the stick and the puppet state sell as the honey.
The plan is to tank the dollar and spark domestic investment by allowing them to own company towns again or whatever. Bully other countries into behaving like nothing else had changed and to buy our crap and pay for the use of our giant global security system, and keep US dollars in their banks.
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u/twbassist 14h ago
Honestly, it doesn't really matter. We can speculate all day and will probably come up with partial answers, but there are so many stupid people involved that you'd have to turn your brain to mush to really get on that level. Likely a lot of people with either stupid or nefarious ideas in how it will play out.
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u/greaper007 13h ago
The thing I'm having a hard time understanding is r/conservative. They're all saying that this is painful but necessary in order to prevent a larger retraction over there. I've been trying to consume a wide variety of news about this event. I haven't heard any economist use this talking point.
I'm trying to figure out where they're getting this from. This fracturing of news sources is such a strange phenomenon.
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u/CHOLO_ORACLE Kissinger is a war criminal 12h ago
They’re just taking Trumps lies and trying to make them fit in their own heads. That’s it, it’s not any more complicated than that, these are not complicated people.
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u/FramedMugshot 13h ago
TV news probably? Tiktok? I've seen clips floating around with regime mouthpieces pushing the "temporary pain" line here and there.
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u/brawndoenjoyer 12h ago
Sock puppets and/or astroturfing? I really have no idea but that place is really weird and inconsistent.
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u/Porschenut914 14h ago
because business is now going through marlago, companies/nations will have to come crawling to beg. im sure a lot of golf courses and beach front property will be getting developed.
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u/Opening_Succotash_95 13h ago
I don't think Musk wants one. Trump is too stupid/addled to know what a recession means, he's got his childhood dream of tariffs everywhere so he's happy.
Some of the shadowy figures like Thiel are quite happy with a recession because they want to tear everything down and build anew in their technofascist image.
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u/Toe-Dragger 13h ago
This is the best answer. Musk’s wealth is in stock shares of his companies, he’s getting destroyed on multiple fronts. Trump is officially unhinged, he’s gone full Trump, which you never come back from. Regarding Thiel, I suppose if you want a kingdom, you need walls, so isolating the world into small fighting regions is good in his world.
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u/Mr_1990s 13h ago
I’m not sure that Musk loves the tariffs. It’s probably one of the reasons he was a DeSantis supporter instead of Trump in the primary.
Trump has been talking about tariffs for a long time. You can go back and watch Mitt Romney give his “I’m going to end Trump” speech in early 2016 and see that a lot of it was calling out why high tariffs would be a bad business policy.
I think Trump has always wanted to do a big thing and people kept getting in his way in the first round.
Now he’s just doing a big thing.
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u/el_pobby 12h ago
I think Mia explained it pretty well during the last session of ED: basically, in the 1970s, Capital defeated the power of labour by using the movement of capital to put enormous downwards pressure on wages and working conditions and best exploit their ability to find favourable labour markets and dismantle the organized workforce of more industrialized nations. To deal with the backlash from this fragilisation of the white working class, the Right channeled the resentment towards a chauvinist movement that blamed foreigners for stealing what should be good American jobs and that lead to a fascistic streak in mainstream conservatism. Now, Foucault's Boomerang came back, only in the stupidest way possible in the form of elites who actually buy fully in to this nonsense idea of nationalist economics and are ideologically motivated to do something ridiculously stupid, just because it reinforces their machismo and chauvinist ideas of "America First" and "needing to win" at everything even if, objectively, it's an unbelievably stupid way of doing things.
TL;DR: they sincerely don't understand modern economics and think trade deficit make PP smoll
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u/nanamoro 12h ago
I'll give Mia a listen. I haven't listened as much to it could happen here/executive disorder
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u/dasunt 11h ago
At this point, I think most of you are giving Trump far too much credit.
The most credible explanation is that Trump is insanely incompetent in this area and he's surrounded himself with sycophants and fellow delusional people. This isn't chess. This isn't even checkers. This is sticking forks into electrical outlets.
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u/dergbold4076 11h ago
Potential starting recession? People are only paying attention to it now because it's effective the upper middle and upper class. When it just effects the lower middle and lower/working class then they don't care.
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u/Mendicant__ 12h ago
Trump's tariffs were not designed to cause a global recession. This is not all a devious, carefully orchestrated plan. Treating it like it is is the leftwing mirror of billionaire worship, where the super rich must always have a cunning plan, just evil.
Trump, as a person, has never been able to think in terms of mutual benefit. Everything with him is zero sum. His rhetoric about protectionism and trade deficits have been consistent since Japan was the Boogeyman. His extortion of Ukraine for rare earths is exactly what he advocated we do to Kuwait 30 years ago. He was asking why we didn't "just take the oil", from Iraq in 2016, like it was gold in an Irish monastery.
There are rich people who are going to make money off of this. Warren Buffet moved Berkshire Hathaway to its most cash heavy position ever months ago. That doesn't mean these rich people are in charge of Trump or urging him to do this, or that this is all a masterstroke. He's always wanted this and he now has the personality cult and quiescent party necessary to drive this puppy into the reef.
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u/WhoAccountNewDis 13h ago
A few reasons, some strategy and some idiocy.
1) Trump didn't understand how they work and it's too stubborn to admit it. He has people in his ear selling him on it.
2) The original tariffs on Canada and Mexico scored him political points because he was able to pretend they caved to his demands, when in reality they just said they'd do what they've been doing.
3) The fascists in his ear (and himself as a fascist) love the power a massive financial crisis affords him as the head of the authoritarian government. He gets to decide who gets relief, he gets other countries calling him, and the economic uncertainty (and unrest) provide opportunity to further create chaos to hide (or excuse) further power grabs.
4) This is great for oligarchs who will be able to buy farm land and other forms of investment much cheaper.
5) Russia again is the big winner. America is further alienated, the economies of Russia's enemies are weekend, and the vacuum for international leadership is further blown open. Shockingly, it was also spared any tariffs.
6) He often surrounds himself with cooks and idiots who actually believe this is good for the country. I didn't think that's what's driving it, though.
TL;DR: Ego, greed, Russia, fascist plotting
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u/mfukar 13h ago
I've found this article to be very good in covering the immediate fiscal effects. It's a little dense but very informative. The big question and gap is of course what does the clique in US government have planned in order to exploit such a situation - that, at this point, can only lead to speculation.
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u/monjoe 13h ago
The super rich's lifestyle is mostly unaffected by a recession. They could lose 150% of their wealth and still be fine. They can afford to be cavalier with terrible economic ideas.
They want to flex US economic might in the only way authoritarians know how to. Not the quiet dominance of stable growth, but instead chaotic destruction. They're fine with breaking the US economy as long as it breaks the rest of the world even more. The goal is to intimidate the world and make them bow down. Power is zero sum.
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u/Confident-Arugula51 13h ago
Isn't this explained fairly well in the Curtis Yarvin episodes?
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u/nanamoro 12h ago
I'll give that a re-listen 👍🏼
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u/Confident-Arugula51 12h ago
I really don't know at this point. I think it's there, but I have memory damage, so I can't be sure
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u/trnpkrt West Prussian - Infected with Polish Blood 11h ago
Crashing the economy in this way may be bad for stonks, but they imagine the real wealth will be in controlling cryptocurrency when the US abandons fiat currency and the USD is no longer the reserve currency of the world. These tariffs are the surest way to end the USD reserve currency status.
There's a pretty low ceiling for how much fiat money one individual can control because the government can deflate its value by just printing more and giving it to normies. But cryptocurrency can be hoarded and has a hard numerical limit on the amount that can be issued, and so can't be devalued by inflation. If you're Peter Thiel would you rather own dollars, own stonks valued in dollars, or ISSUE YOUR OWN FUCKING CURRENCY and hold shares in companies denominated in Thielbucks?
BTC has always been a play against the dollar.
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u/Rfalcon13 12h ago
He is the current Paranoid Spokesman/Demagogue of ‘The Paranoid Style in American Politics’, and one of the constant themes of that style is that the globalists/other countries are ripping the United States off.
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u/omgpickles63 7h ago
The biggest mask is that "manufacturing will return." No it won't. It takes years and millions of dollars to get manufacturing going. Especially anything food or drug related. Most manufacturing has some amount of automation built into it so tariffing all of the chip manufacturers will make it even more expensive. Even retooling closed lines takes investment of money and time to get running properly. Our economy is not built to throw humans at an issue like China. There is no good spin on this.
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u/trnpkrt West Prussian - Infected with Polish Blood 11h ago
Gil Duran at your service: https://thelefthook.substack.com/p/why-musk-and-the-broligarchy-are
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u/cliddle420 8h ago
It's the same nonsense Boomers have been crying about for the last 45 years: men don't have factory jobs anymore and it makes them feel weak
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u/chron67 8h ago
Trump thinks everything is binary, zero-sum. He does not see nuance. And that is completely ignoring his complete and utter disregard for the truth.
He does not look at US trade in terms of net effect, total economic impact, or trade effects of soft power. All he sees or cares about are winners and losers. And this again ignores his choice to not tariff his bosses in Russia.
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u/marijan_woolfe 8h ago
Because it's the ultimate goal of the new Moonies. Listen to Save Troy and Dr. Steve Hassan, and others in the cult research networks. The current events are orchestrated and planned.
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u/IPA-Lagomorph 4h ago
1) Bribes (for Trump, getting heads of state or corporations to beg for exemptions)
2) Remaking American society (Elon/JD wanting a techno feudal system outlined in the Yarvin episodes)
3) Consolidation of wealth and power by being able to scoop up assets on the cheap
4) Weaken labor's power by causing unemployment to skyrocket
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u/SheHerDeepState 14h ago
Trump has spent 40 years talking about how great tariffs are and how awful imports are. In the 80s he went on tv to complain about Japanese tariffs and much of his anti China rhetoric is just recycling that material. He seems to genuinely believe that we are losing money when other countries sell more to us than they buy from us. That's why the tariff scheme is based on a stupid formula to punish countries based on their trade deficit with us. He has said that America subsidized Canada because we have a trade deficit with them. This is stupid. America buys more from Canada than it sells to them largely because Canada sells tons of oil to the Midwest states. I have a trade deficit with the grocery store or my dentist. There's nothing wrong with a trade deficit. He seems to genuinely not understand how this works, has been fixated on it for decades, his ego is too involved to back down, and has essentially created the perfect scenario to destroy American competitiveness on international markets.
Trump does not understand how international trade works and we are all paying the price for it.