Dow slumps 800 points after bonds flash recession warning

Specialist Mario Picone works on the floor of the New York Stock Exchange on Wednesday, the day the Dow Jones Industrial Average sank 800 points. Richard Drew/Associated Press

The Trump administration has eased off its latest tariff threat against China.

Good.

Under pressure from retailers and other businesses, President Trump’s trade office said it would delay until Dec. 15 tariffs on nearly 60% of the imports that had been set to absorb the new taxes starting Sept. 1. Among the products that will benefit from the reprieve are such popular items as cellphones, laptops, video game consoles, some toys, computer monitors, shoes and clothing, The Associated Press reported.

Moving the threatened implementation of the tariff to Dec. 15 would prevent higher prices on consumer goods during the critical Christmas shopping period.

Implicit in the decision is recognition that the president’s often-repeated belief that his tariffs would be paid for by China, not American consumers, is wrong. A tariff is a tax that hurts buyer and sellers, but it is paid for by the buyers, us.

Meanwhile, the Dow Jones industrial average dropped by 800 points Wednesday as investors reacted to fears that our trade war is dragging the world economy into a recession. The AP reported that one of the biggest hits was to Macy’s, a major local employer; energy stocks were also big losers on the day.

Stocks rise and fall, and a one-day skid does not a recession make, but the evidence is mounting that Trump’s unilateral trade war with China is claiming casualties in the world economy, the American economy and the Tulsa economy.

The U.S. has legitimate beefs against China’s trade practices, but charging into a tariff war without any allies to back us is a high-risk strategy that puts our workers, our farmers and our investment-dependent retirees at risk.

We’re glad Trump recognized the dangers of his latest tariff threat and hope it reflects a broader reconsideration of the consequences of an ill-considered trade war.

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