In an examination into how Donald Trump's trade war is impacting U.S. manufacturers and farmers, Bloomberg reports that, not only is a recession likely due to the president's trade policies, but in some sectors of the country it has already arrived.
The report begins with an interview with Greg Petras, president of Kuhn North America, a manufacturer farm equipment in Wisconsin where he employs over 600 people.
With Bloomberg characterizing Trump's trade was as a "toxic mix of rising costs and falling revenues," Petras grew angry when asked about the president's claim China is absorbing all the costs.
“It’s just an outright lie, and he knows it,” Petras exclaimed. “You’re slamming your fist on the steering wheel and saying ‘Why would you tell people this?’”
According to the report, Petras recently furloughed over 250 workers for two weeks during the Labor Day holidays, and they are facing another unpaid break in October if sales continue to falter.
"A plant that just four years ago was humming along to a record $400 million in sales together with a sister plant in Kansas is running at 50% capacity. The five-year-old, $11 million paint shop that coats the company’s manure spreaders and livestock feeders in a distinctive 'Kuhn Red' is at 39% capacity," the report states, adding, "Plans for a new $4 million research and development building are on hold, with Petras explaining, "We’ll do it someday. We just need things to be going in a better direction.”
Bloomberg goes on to note that Trump's trade war has reversed manufacturing job growth under President Trump, stating: "The surge in industrial jobs seen in the first two years of the Trump presidency has also gone into reverse in some parts of the country. Nationally, the U.S. has added 44,000 manufacturing jobs so far this year, according to data released on Friday. But that’s way down from the 170,000 added in the same period last year."
With an election coming where Trump's fate will likely be tied directly to the economy, the report notes he could be in big trouble as his trade war lingers on.
"The inescapable irony is that Trump’s trade wars have helped create a scenario similar to one that helped get him elected in 2016. As a candidate, Trump benefited from the grinding and uneven recovery from the last recession. He also got a boost from a manufacturing slowdown that struck the Rust Belt just as he hit the stump promising a new era of protectionism," Bloomberg reports.
For his part, Petras -- a lifelong Republican -- said he is done with Trump after having voted for him in 2016.
“I defaulted to the Republican ticket thinking pro-business,” he said in an interview, with the report adding, "But he won’t in 2020. Trump has turned him into an independent, he says, and he’s now expecting to vote for a Democrat."
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