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      Bessent Pitches Skittish Investors to Bet on Trump’s Economic Plan

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      The Treasury secretary urged executives and entrepreneurs to look beyond the Trump administration’s trade agenda.Treasury Secretary Scott Bessent urged skittish global business leaders on Monday to ignore President Trump’s economic naysayers and ramp up investment in the United States, defending an economic agenda that economists warn will slow economic growth and exacerbate inflation.Speaking to executives, entrepreneurs and policymakers, Mr. Bessent argued that the Trump administration’s economic plans go beyond trade policy and will pay off in the long run. He urged them to also focus on Mr. Trump’s plans to cut taxes and regulation, which he said would spur job creation and output.“Tariffs are engineered to encourage companies like yours to invest directly in the United States,” Mr. Bessent said in remarks at the Milken Institute Global Conference in Los Angeles. “You’ll be glad you did — not only because we have the most productive work force in the world. But because we will soon have the most favorable tax and regulatory environment as well.”His comments came just hours after Mr. Trump ordered up new tariffs on foreign film producers, a decision that left many in Hollywood puzzled about how such a tax would work.The Treasury Secretary has been working to ease concerns among investors that Mr. Trump’s trade plans will destabilize the global economy. Mr. Trump last month levied tariffs on countries around the world and escalated a trade fight with China, which sent financial markets plunging.Since then, Mr. Bessent has been racing to negotiate trade deals with dozens of countries. He has also signaled that the China tariffs are not sustainable, offering hope that Mr. Trump would soon begin negotiations to lower them.”Our goal with trade policy is to level the playing field for our great American workers and companies,” Mr. Bessent said.The Trump administration is working closely with congressional Republicans ]on tax legislation that would extend the 2017 tax cuts and offer new tax breaks for overtime pay, tips and Social Security benefits. Mr. Bessent made the case on Monday that investors need to consider the broader agenda when thinking about where to park their money.Describing Mr. Trump’s policies as “mutually reinforcing,” Mr. Bessent said, “acting in concert, they push toward the same goal — to solidify our position as the home of global capital.”Investors have grown increasingly wary of Mr. Trump’s policies in recent months, with stocks, bonds and the dollar all showing signs of weakness as fund managers fret over the uncertainty surrounding Mr. Trump’s policymaking approach.The International Monetary Fund projected last month that global output will slow to 2.8 percent this year from 3.3 percent in 2024 and sharply downgraded its outlook for the U.S. economy.On Monday, Mr. Bessent said that Mr. Trump would prove “critics in establishment circles” wrong.“We have the world’s reserve currency, the deepest and most liquid markets, and the strongest property rights,” Mr. Bessent said. “For these reasons, the United States is the premier destination for international capital.” More

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      Trump Wavers When Asked About Due Process Rights and His Constitutional Duties

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      President Trump repeatedly answered “I don’t know” when asked in a TV interview whether every person on American soil was entitled to due process, as guaranteed by the Fifth Amendment.President Trump said in an interview that aired on Sunday that he did not know whether every person on American soil was entitled to due process, despite constitutional guarantees, and complained that adhering to that principle would result in an unmanageable slowdown of his mass deportation program.The revealing exchange, on NBC’s “Meet the Press,” was prompted by the interviewer Kristen Welker asking Mr. Trump if he agreed with Secretary of State Marco Rubio that citizens and noncitizens in the United States were entitled to due process.“I don’t know,” Mr. Trump replied. “I’m not, I’m not a lawyer. I don’t know.”Ms. Welker reminded the president that the Fifth Amendment says as much.“I don’t know,” Mr. Trump said again. “It seems — it might say that, but if you’re talking about that, then we’d have to have a million or two million or three million trials.” Left unmentioned was how anyone could be sure these people were undocumented immigrants, let alone criminals, without hearings.Mr. Trump responded “I don’t know” one more time and referred to his “brilliant lawyers” when Ms. Welker asked whether, as president, he needed to “uphold the Constitution of the United States.”The comments came amid the many legal challenges to the administration’s agenda, especially Mr. Trump’s aggressive deportation campaign, and as top administration officials have begun to question the president’s obligation to provide due process. Mr. Trump has attacked judges, called for their impeachment and ignored a Supreme Court ruling directing his administration to facilitate the return of a migrant, Kilmar Armando Abrego Garcia, who was mistakenly sent to a prison for terrorists in El Salvador.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Someone Should Tell Trump He’s About to Make the Trade Deficit Worse

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      There are many reasons President Trump should not be pushing Congress to pass huge tax cuts, but here’s one you may not have heard: Budget deficits and trade deficits are twins. When the former go up, so, generally, do the latter. So at the same moment Mr. Trump is upending the global economy in a feckless attempt to eliminate America’s trade deficit, he’s essentially pressuring Congress to increase it.Here’s how it happens. The United States buys a lot of goods from other countries, and we pay for the goods with dollars. But those dollars are no good abroad, so the countries we buy from invest them here. Some of the money goes, directly or indirectly, into businesses that are raising cash to build new data centers or expand natural gas facilities or construct new apartment complexes. Other dollars go into Treasury bonds or bills, which the federal government uses to fund our large budget deficit. (The same thing happens in reverse when other countries buy from the United States — but to a lesser degree, since our imports are larger than our exports.)If the budget deficit rises, American investors could theoretically cover the shortfall, but that would mean putting their money in Treasury securities rather than businesses and their capital needs. The other option is that foreign countries amass more dollars and plow them back into the U.S. economy. How would they get those additional dollars? From all the German cars and Chinese electronics and imported beer that Americans will buy with the money from their tax cuts.More generally, a larger budget deficit will require the government to borrow more money, which drives up interest rates. Higher interest rates mean a stronger dollar, which makes it more expensive for people in other countries to buy our products, cheaper for us to buy theirs, and thus the trade deficit widens.So cutting taxes, as Mr. Trump has told Congress to do, will drive up the budget deficit — and the trade deficit. All of this may seem counterintuitive, but it’s one of the few things that economists agree about.The budget deficit is already worryingly high and the tax cuts Mr. Trump is seeking would make it even larger. Last year the United States ran a $1.8 trillion budget deficit, or 6 percent of the gross domestic product — higher than at any other time except during World War II, the late-2000s financial crisis and the Covid-19 pandemic — despite strong economic growth and no unusual emergencies.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      For the U.S. and China, the Only Talking Is About Whether to Talk

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      The standoff over terms of negotiations, and whether they are happening, signals that a protracted economic fight lies ahead.As trade tensions flared between the world’s largest economies, communication between the United States and China has been so shaky that the two superpowers cannot even agree on whether they are talking at all.At a White House economic briefing this week, Treasury Secretary Scott Bessent demurred multiple times when pressed about President Trump’s recent claim that President Xi Jinping of China had called him. Although top economic officials might usually be aware of such high-level talks, Mr. Bessent insisted that he was not logging the president’s calls.“I have a lot of jobs around the White House; running the switchboard isn’t one of them,” Mr. Bessent joked.But the apparent silence between the United States and China is a serious matter for the global economy.Markets are fixated on the mystery of whether back-channel discussions are taking place. Although the two countries have not severed all ties, it does seem that they have gone dark when it comes to conversations about tariffs.“China and the U.S. have not held consultations or negotiations on the issue of tariffs,” Guo Jiakun, a spokesman for China’s foreign ministry, said at a news conference last Friday. “The United States should not confuse the public.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      A Tidal Wave of Change Is Headed for the U.S. Economy

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      When the Covid pandemic hit, factories in China shut down and global shipping traffic slowed. Within a matter of a few weeks, products began disappearing from U.S. store shelves and American firms that depend on foreign materials were going out of business.A similar trend is beginning to play out, but this time the catalyst is President Trump’s decision to raise tariffs on Chinese imports to a minimum of 145 percent, an amount so steep that much of the trade between the United States and China has ground to a halt. Fewer massive container ships have been plying the ocean between Chinese and American ports, and in the coming weeks, far fewer Chinese goods will arrive on American shores.While high tariffs on Chinese products have been in place since early April, the availability of Chinese products and the price that consumers pay for them has not changed that much. But some companies are now starting to raise their prices. And experts say that the effects will become more and more obvious in the coming weeks, as a tidal wave of change stemming from canceled orders in Chinese factories works its way around the world to the United States.The number of massive container ships carrying metal boxes of toys, furniture and other products departing China for the United States has plummeted by about a third this month.The reason consumers haven’t felt many of the effects yet is because it takes 20 to 40 days for a container ship to travel across the Pacific Ocean. It then takes another one to 10 days for Chinese goods to make their way by train or truck to various cities around the country, economists at Apollo Global Management wrote in a recent report. That means that the higher tariffs on China that went into effect at the beginning of April are just starting to result in a drop in the number of ships arriving at American ports, a trend that should intensify.By late May or early June, consumers could start to see some empty shelves, and layoffs could occur for retailers and logistics industries. The major effects on the U.S. economy of shutting down trade with China will start to become apparent in the summer of 2025, when the United States might slip into a recession, said Torsten Slok, an economist at Apollo.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Trump Tariffs and Shrinking GDP Raise Political Stakes

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      The report that the economy contracted in the first quarter underscored how much President Trump has at risk as he pursues an aggressive trade war.President Trump took office 101 days ago after a campaign in which voters bought his argument that he could skillfully manage the economy and that his policy prescriptions could both bolster growth and eradicate inflation.So the news on Wednesday that the nation’s gross domestic product had contracted in the first three months of the year was a sharp political jolt as well as a blinking economic warning.It came at the end of a quarter in which stock prices were down sharply, Wall Street’s worst performance at the start of a new presidential term since Gerald R. Ford tried to steer the country out of scandal and inflation 51 years ago. And it only added to the widespread uncertainty among businesses and consumers about what the rest of the year might hold as Mr. Trump pursues a trade war that is already choking off supply chains and threatening to push prices up and lead to shortages of critical components and products on shelves.It is too soon to predict where the American economy is headed for the rest of the year, and Mr. Trump remains insistent that he will produce a flurry of trade deals that will bring manufacturing back to the United States and usher in a new age of prosperity.But the first-quarter figures brought the political risks for him into focus. For Mr. Trump, what is at stake is a question of fundamental competence on an issue that he has always used to define himself.If the report proves to be a harbinger of an extended slowdown or recession, the situation could become the economic analog of President Joseph R. Biden Jr.’s fumbled withdrawal from Afghanistan four years ago this summer. Mr. Biden’s job approval ratings never recovered from that early debacle. Nothing he did later — not the millions of jobs created, not the big legislative victories, not the rapid response to Russia’s invasion of Ukraine — could restore the sense among voters that he could be trusted to carry out the job with the skill they assumed he brought to it.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Under Trump, Stocks Have the Worst Start to a Presidential Term Since 1974

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      During the first 100 days of the Trump administration, shock waves from the chaotic tariff rollout continue to send tremors through the global financial system.One hundred days of President Trump. Seventy days of whipsaw trading in financial markets. Thirty three days of losses. More than $6.5 trillion wiped from the value of public companies.For financial markets, the 9 percent drop in the S&P 500 is on track for the worst start to a presidential term since Gerald R. Ford took over from Richard M. Nixon in August 1974 after the Watergate scandal. The slump is worse even than when the tech bubble burst at the turn of the century, and George W. Bush inherited a market already in free fall.In contrast, Mr. Trump inherited an economy on solid footing and a stock market rising from one record high to another.That swiftly changed when Mr. Trump unveiled his marquee suite of tariffs on April 2 — not the first new import taxes announced by his administration, but by far the most sweeping. Volatility erupted. Wall Street frantically began to grapple with the economic consequences of the new government’s policies.The S&P 500 tumbled more than 10 percent in two days, a drop comparable to some of the worst days of the pandemic-induced sell-off in March 2020 and, before that, the financial crisis in 2008.Stocks have since stabilized, but the shock waves from the chaotic tariff rollout continue to send tremors through the global financial system.Trump’s Astonishing 100 Days, in 8 ChartsBy many measures, the opening months of President Trump’s second term stand apart from those of essentially any modern president.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Trump Administration Looks to Take Steps to Ease Pain From Car Tariffs

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      The planned concessions to give automakers more time to relocate production to the United States would still leave substantial tariffs on imported cars and car parts.The Trump administration said it plans to announce measures as early as Tuesday to ease the impact of tariffs on imported cars and car parts to give automakers more time to relocate production to the United States.Tariffs of 25 percent on imported vehicles and on auto parts will remain in place. But the tariffs will be modified so that they are not “stacked” with other tariffs, for example on steel and aluminum, a White House spokesman said. Automakers will not have to pay tariffs on those metals, widely used in automobiles, on top of the tariffs on cars and parts.In addition, automakers will be reimbursed for some of the cost of tariffs on imported components. The reimbursement will amount to up to 3.75 percent of the value of a new car in the first year, but will be phased out over two years, the spokesman confirmed.A 25 percent tariff on imported cars took effect April 3. On Saturday, the tariffs are set to be extended to include imported parts.“President Trump is building an important partnership with both the domestic automakers and our great American workers,” Howard Lutnick, the commerce secretary, said in a statement. “This deal is a major victory for the president’s trade policy by rewarding companies who manufacture domestically, while providing runway to manufacturers who have expressed their commitment to invest in America and expand their domestic manufacturing.”But even with these changes, there will still be substantial tariffs on imported cars and auto parts, which will raise prices for new and used cars by thousands of dollars and increase the cost of repairs and insurance premiums.The modification to the tariffs was reported earlier by The Wall Street Journal. Mr. Lutnick helped automakers secure a major exemption from tariffs in March and has taken on a role advocating relief for some industries hit by the levies.Automakers welcomed the change. “We believe the president’s leadership is helping level the playing field for companies like G.M. and allowing us to invest even more in the U.S. economy,” Mary T. Barra, the chief executive of General Motors, said in a statement on Monday. “We appreciate the productive conversations with the president and his administration and look forward to continuing to work together.” More