博客

A year after his election victory, US President Donald Trump’s economic policies are fulfilling campaign promises but are simultaneously weaponizing uncertainty, exacerbating global economic divisions and risks, according to Adam Posen, president of the Peterson Institute for International Economics. Posen described Trump’s approach as consistent yet incoherent, leading to patchwork outcomes that are not economically beneficial. He highlighted Trump’s core agenda, which includes a 15% across-the-board tariff, targeted duties on key industries like semiconductors and autos, and trade barriers that are ‘anti-China, but less anti-China than the hawks in either the Joe Biden administration or the Republicans wanted.’ Posen emphasized that Trump’s policies are characterized by hostility to foreigners, extreme skepticism toward trade and migration, fiscal excess, and the exercise of executive power. He noted that the negative impacts of tariffs and deportations take about a year to fully emerge, as shown by models created by senior fellows at the Peterson Institute. Businesses have faced prolonged uncertainty since the April 1 tariff announcement, with companies like Toyota and Caterpillar considering separate production in China. Despite the administration’s goal of deporting one million people yearly, the economy has not cratered due to ‘underground’ adaptation, with sectors like food processing and construction showing flat output and employment. Posen warned of a ‘stagflationary combination’ ahead, including shortages, inflation, and contraction, unless deportations stop. He also highlighted the role of artificial intelligence investments as an ‘exogenous salvation,’ with tech giants self-financing rapid AI spending from retained earnings, achieving early productivity gains. However, AI alone cannot mask structural issues, as tariff-hit industries will see rising domestic prices and falling output, employment, and growth. Posen’s article in Foreign Affairs noted that firms and governments are abandoning reliance on US ‘insurance’ and are self-insuring through non-dollar assets and localized investment. He also pointed out that US allies like the UK, Japan, South Korea, and Canada are suffering the most, while China has been able to stand up against the US and face Trump down.

In a bold move to reshape its economic strategy, Canada has unveiled a comprehensive federal budget aimed at reducing its reliance on the US market. Announced on November 4, 2025, by Prime Minister Mark Carney, the budget allocates over C$25 billion ($17.8 billion) to support industries impacted by US tariffs and trade disruptions, with an additional C$25 billion pledged by 2030 to enhance trade facilitation. The budget underscores Canada’s commitment to forging new economic and security partnerships beyond its southern neighbor. Carney emphasized that the era of deepening economic ties with the US has ended, stating, ‘Many of our former strengths — based on close ties to America — have become our vulnerabilities.’ The budget is seen as a confidence motion, and its failure to pass could trigger an early election, potentially unsettling markets. Economists like Mesbah Fathy Sharaf of the University of Alberta view the budget as a pragmatic response to a more protectionist global trade environment. Sharaf noted, ‘Canada is clearly looking East and West, such as Europe and the Asia-Pacific, for new opportunities.’ The budget also seeks to accelerate domestic economic activity through financial incentives and expedited project approvals. However, critics like Ron Stagg of Toronto Metropolitan University argue that the measures are largely defensive and short-term. Stagg remarked, ‘The government is hoping to increase economic activity within Canada by providing financial incentives and by fast-tracking approval for projects seen as of national importance.’ Despite the uncertainties, the budget signals Canada’s determination to diversify its economic relationships and assert greater independence on the global stage.