US President Donald Trump’s trade wars are hurting American manufacturers and investment, according to his former top economic adviser Gary Cohn.
He also said the Chinese economy would have slowed down “with or without a trade war”, contradicting his ex-boss’s claims that tariffs are badly damaging the US’s rival.
Speaking to BBC Radio 4’s Today programme, Cohn said: “Take the automobile industry in the United States, it’s suffering. It’s suffering because tariffs are hurting that industry.”
The former president of Goldman Sachs said tariffs were also having a “dramatic impact” on the US farming community and on capital investment.
“In the service side of the economy, it’s not having nearly as big as an impact because tariffs don’t affect it. You’re seeing a very interesting bifurcation of the US economy.”
Trump ratcheted up tariffs on $200bn of Chinese goods to 25 per cent in May after trade talks between the two sides broke down. He has since claimed the tariffs are damaging the Chinese economy, which is slowing.
“I don’t really think it’s hitting the Chinese economy,” Cohn said. “Credit and credit availability is determined by the central government.”
“The trade war with the United States was a very convenient excuse for the Chinese to slow down their economy when they needed to slow down an overheating economy, where prices and real estate prices and everything were getting out of hand.”
On a no-deal Brexit, Cohn said: “It’s better than where you are now. You talk about the United States being stymied in capital investment, the only place that makes the United States look like we have a lot of capital investment is the UK.”