An economist has suggested the sudden tariff hike Donald Trump has set on Iran and its trading partners "will not change" anything.
Iranian Foreign Minister Abbas Araghchi warned the US administration they are ready for war should Trump wish to "test" the lengths Iran will go to. Araghchi claimed Iran are "prepared for all options" and now control a "large and extensive military preparedness".
He added, "If Washington wants to test the military option it has tested before, we are ready for it." Araghchi warned off "those trying to drag Washington into war in order to serve Israel’s interests."
Trump opted for a massive tariff hike on Iran and its trading partners, which includes China. Maurice Obstfeld, former chief economist for the International Monetary Fund, says the policy will do more damage to the US than it will to Iran.
Speaking to The Washington Post, Obstfeld said the 25% increase on Iranian goods is "profoundly self-harming for the U.S., and [it] will not change the Iranians’ behavior one iota."
Council on Foreign Relations representative Brad Setser also warned there would be more an effect on the US economy than Iran's. Economist Sester suggested there would be a "meaningful shock" to the US economy should the tariffs stay.
The 25% tariff on goods from any nation doing business with Iran means goods from China, India, Russia, Turkey, and Iraq will receive a huge hike in price.
Liu Pengyu, spokesperson for the Chinese Embassy in the U.S, has denounced the new tariff. He wrote, "Tariff wars and trade wars have no winners, and coercion and pressure cannot solve problems."
"China firmly opposes any illicit unilateral sanctions and long-arm jurisdiction, and will take all necessary measures to safeguard its legitimate rights and interests."
Trump had leaned towards striking Iran in recent days, according to an insider speaking with Axios. "As reports emerged that hundreds of protesters were killed over the weekend, Trump told reporters Iran was 'starting to' cross his red line," according to Axios.
"If Trump orders strikes, they would likely target elements of the regime involved in internal security and seen as responsible for the crackdown," the outlet reported.
