Region’s connection to South Carolina may make trade war worse
The trade war with China may have more of an impact on the Puget Sound region thanks to our connection with South Carolina.
Matthew Gardner, chief economist at Windermere, told Seattle’s Morning News that China is imposing tariffs on products produced in states that voted for President Trump. That includes the aerospace industry, thus Boeing, which operates in Western Washington and South Carolina.
China is one of Boeing’s best customers. Aerospace analyst Richard Aboulafia explained the country is the biggest jetliner market in the world, as well as the fastest-growing market. Worst case scenario is the cancellation of orders over the tariffs. However, Aboulafia previously predicted things wouldn’t come to that.
On Friday, the Trump administration imposed tariffs on $34 billion of Chinese goods in response to growing complaints that Beijing either steals or pressures companies to hand over technology, the Associated Press reports. China then countered with its own tariffs on a similar amount of U.S. products.
President Trump warned the total amount of goods affected may exceed $500 billion.
As the trade war escalates, Gardner continues to warn of an impending recession that will begin in 2019 or early 2020. He says $500 billion in tariffs would be “horrendous” and drive the U.S. into a survivable recession.
Gardner says we should not worry about the housing market, but a recession will have a negative effect on wages and things such as food prices. The biggest concern, he said, is uncertainty in a consumer-driven society. If people stop spending, it could create additional problems.
Listen to the entire conversation here.