Gary Cohn, President Trump’s former chief economic advisor, told CNBC on Thursday that the president’s trade war with China was killing the United States’ service economy.
Cohn noted that 80% of the United States’ GDP and job creation is in that service economy.
“When you’re a service economy, the way to stimulate your economy, the way to grow your economy is to allow consumers to buy goods as cheaply as they possibly can, and use the rest of their money to buy services or if they’re lucky enough to save,” he said. “Anything that raises the price of a good doesn’t make sense for our economy. Even if they’re paying it to the government as a tariff, it’s just another tax.”
Cohn dismissed Trump’s focus on manufacturing, saying that jobseekers were actively seeking service positions.
“If we look at the last JOLT (Job Openings and Labor Turnover) data that we always talk about, the big increase is we saw more need for workers in business services,” he said. “We saw more voluntarily leavers from the manufacturing industry, because as the job market tightens, people will voluntarily leave the manufacturing industry and go into the service industry.”
Watch the video below.