Wednesday, September 3, 2025

Polaris of Enlightenment

Economy professor: Trump’s tariffs rooted in “flakey” trade deficit analysis

Donald Trump's USA

Published 9 April 2025
– By Editorial Staff
Jeffrey Sachs of Columbia University.
4 minute read

In a wide-ranging interview with The Duran , economist Jeffrey Sachs critiques Donald Trump’s tariff policies, calling the administration’s understanding of trade deficits “completely flakey” and warning of severe economic and geopolitical consequences.

Sachs, a Columbia University professor and former UN advisor, emphasizes that tariffs will not address the root causes of US trade imbalances and instead risk fragmented trade, rising consumer costs, and global instability.

Sachs begins by rejecting the core argument for Trump’s tariffs: the claim that US trade deficits result from “unfair” foreign trade practices.

– The trade deficits have nothing to do – I will say nothing to do – with the trade policies of the rest of the world. They have no indication whatsoever that anybody is ripping off anybody, especially that the rest of the world is ripping off the United States.

He defines a trade deficit as a macroeconomic imbalance, not a trade policy failure.

– What a trade deficit means – pure and simple – is that a country is spending more than it is earning. That’s all.

Sachs dismisses the Trump administration’s diagnosis as “completely flakey”, comparing it to a shopper blaming stores for overspending.

– Trump calls that a ripoff. It’s a little strange… It’s like a person who goes on a shopping binge, runs a current account deficit against all those stores they visited, and then blames the shops for those imbalances.

– The diagnosis is completely flakey. I taught international monetary economics for 22 years at Harvard. In the second day of the undergraduate course, I explained that a current account deficit was an imbalance of spending and production, essentially – not a measure of trade policy.

The twin-deficit problem

Sachs warns that tariffs will harm US households and industries, raising prices for goods like automobiles and disrupting supply chains.

– If you say, ‘We’re not going to have trade’… that pushes workers into the labor-intensive, low-skilled sectors in this value chain. That lowers living standards.

He highlights the risks of stock market instability, referencing a $10 trillion loss in global markets during tariff disputes.

– This is losing what we call the gains from trade.

Sachs draws a direct comparison to the 1930 Smoot-Hawley Tariff Act, which exacerbated the Great Depression.

– The protectionism of 1930 in the United States was an accelerant [of the Depression].

Sachs ties trade deficits to US fiscal policy, emphasizing the “twin deficits” problem.

– We call this the twin deficits problem: You have a large budget deficit that shows up as a large trade deficit, so it’s a twin deficit. This is kind of a chronic characteristic of the US.

He critiques the weaponization of the dollar, noting that US sanctions incentivize countries to abandon the dollar.

– The weaponization of the dollar in confiscating Russian reserves, Venezuelan reserves, Iranian reserves … means that if you have some trade dispute or foreign policy dispute with the US, you’re likely to get your money confiscated.

Geopolitical risks: Taiwan as the next Ukraine

Sachs warns of broader geopolitical fallout, referencing a 2015 Council on Foreign Relations paper titled Revising U.S. Grand Strategy Toward China by Robert Blackwill and Ashley Tellis and highlights its argument for containing China’s rise.

– The argument [in the paper] is China’s rise is no longer in America’s interest. It must be stopped. A shocking idea: we must do damage to another side not because they threaten us, but because they are too big and therefore they undermine US hegemony – that’s literally the argument in the paper. Not a list of nefarious actions by China.

– The grand strategy of the United States, since it’s inception – in essence – is primacy: The United States must be number one. And so, we must prevent any challenge [to dominance] … And this is the motivation for much of what’s happening from 2015: The attempt to form, in crazy ways, new trade groups in Asia that don’t include China, the export bans on technology, the attempt to destroy companies like Huawei and ZTE and rumours and machinations of all sorts of imagined dangers.

Sachs warns that this confrontational approach risks catastrophic escalation over Taiwan, fueled by tariffs and military posturing.

– The unilateral tariffs Trump imposed – not on the world in his first term, but specifically on China – and now the very punitive tariffs on China … are deeply enmeshed in military buildups and military alliances in East Asia, in saber-rattling every day about Taiwan with the real risk that Taiwan turns itself into the next Ukraine by making the same kind of bets on US protection that Ukraine made, that ended up destroying so much of Ukraine, the same thing could happen in Taiwan.

– If it does, the war is going to be even more dangerous for the world, potentially even catastrophic, and with the instability of US economic and political leadership combined with the deep-state animus toward China, it’s pretty risky.

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Danish media: American agents infiltrating Greenland

Donald Trump's USA

Published 28 August 2025
– By Editorial Staff
Donald Trump has repeatedly stated that Greenland should become American.
3 minute read

At least three Americans with ties to President Donald Trump are conducting influence operations in Greenland aimed at undermining the relationship between Denmark and Greenland.

The men are mapping Trump-friendly Greenlanders and gathering information that could be used to damage Denmark’s reputation, according to sources speaking to Danish media.

Actors with direct connections to the White House are conducting systematic attempts to infiltrate Greenlandic society. The goal is to create a pro-American independence movement and weaken ties to Denmark, reveal several anonymous sources with insight into the matter to Danish public broadcaster DR.

One of the men, who has often been seen publicly with President Trump and recently received a role with influence over US security policy, landed earlier this year in snow-covered Nuuk, Greenland’s capital, with a clear mission. He established lists of both Trump sympathizers and opponents among Greenlandic citizens, it is reported.

At the same time, he is said to have collected material about controversial Danish affairs – such as forced removals of Greenlandic children and the so-called spiral affair where Danish doctors inserted contraceptives into Greenlandic women without consent.

— What we see is the use of soft power, influence and attempts to create internal division, says a source to the channel.

Danish security service confirms influence campaigns

Both Danish authorities and the country’s government are now closely monitoring the Americans’ movements on the Arctic island. Two of the men, both with backgrounds in the Trump administration, have regularly traveled between the US and Greenland in recent years to build networks among politicians and businessmen.

— We are all worried about this. Of course we are, confirms a government source.

The Danish Security and Intelligence Service (PET) also confirms that Greenland is being subjected to influence campaigns and that they are in “ongoing and close dialogue with the Greenlandic authorities about developments in the threat picture”.

According to PET’s assessment, the campaigns aim to “create division in the relationship between Greenland and Denmark” by exploiting real or fabricated conflicts.

American strategy in three phases

Sources within the government describe the Trump administration’s Greenland strategy as divided into three distinct phases since the president declared in December 2024 that American “ownership and control of Greenland is an absolute necessity”.

First came the charm offensive, symbolized by Donald Trump Jr.’s high-profile visit to Nuuk in January. This was followed by pressure on Denmark, when Vice President J.D. Vance visited the American Pituffik base in March and accused Denmark of betraying the Greenlanders. Now the strategy is in its third phase according to sources: infiltration of Greenlandic society.

One source warns that the summer’s calmer activity may be misleading:

— Perhaps what we are experiencing right now is the calm before the storm. And perhaps the fewer activities in Greenland are an expression that professional institutions have begun to operate, which they will be better at hiding, he speculates.

Concerns were heightened after the Wall Street Journal’s reporting in May that American intelligence services had been ordered to intensify espionage in Greenland, focusing on the independence movement and mapping Trump sympathizers.

Sensitive for Denmark

The American activities also place Danish power holders in a delicate position. While they want to alert Greenlanders to the influence attempts and prevent them, they are simultaneously concerned for political reasons about not being perceived as interfering in Greenland’s internal affairs.

— Greenlanders are welcome to work for independence, and the US is welcome to invest and work for stronger ties to Greenland, explains one source, but emphasizes that there are limits that must not be crossed.

— No one is allowed to spy – not even the Americans.

The White House has declined to comment on the allegations from Danish media, and the US embassy in Copenhagen, Denmark refers to the fact that “the American government does not control or direct the actions of private citizens” and that they “respect the Greenlandic people’s right to determine their own future”.

Trump threatens new tariffs in retaliation for “discriminatory” tech taxes

Donald Trump's USA

Published 26 August 2025
– By Editorial Staff
President Trump defends Meta, Google and Amazon against foreign taxes and threatens US countermeasures.
2 minute read

Donald Trump warns of new tariffs and export controls against countries that he claims “discriminate” against American tech giants. The statement could escalate trade conflicts with both the United Kingdom and the EU.

In a post on his Truth Social platform on Monday evening, the president launched a harsh attack against “digital taxes, legislation, rules or regulations” and claimed that as president he intends to defend American companies against what he described as malicious attacks.

“As the President of the United States, I will stand up to Countries that attack our incredible American Tech Companies. Digital Taxes, Digital Services Legislation and Digital Markets Regulations are all designed to harm, or discriminate against, American Technology”, Trump wrote.

“They also, outrageously, give a complete pass to China’s largest Tech Companies. This must end, and end NOW!” he continued.

True to form, Trump uses his own social media platform to tell the world about his plans. Photo: facsimile/Donald Trump/Truth Social

According to analysts, the statement risks further deteriorating trade relations between the US, the United Kingdom and the EU.

“Flagrant attack”

Washington has long criticized the UK’s digital services tax, which despite American criticism was retained after an agreement with Trump’s previous administration. The US has also directed harsh criticism at the EU’s Digital Services Act, which places higher demands on large tech companies to control content on their platforms.

Several EU countries, including France, Italy and Spain, have had their own taxes of similar nature since before, reports Financial Times.

In June, Canada chose to scrap its digital services tax to pave the way for trade negotiations with the US. Trump had previously described the tax as a “direct and flagrant” attack. The British also considered changes to their tax, but ultimately managed to reach a trade agreement without making changes.

In the UK’s case, the tax is 2 percent and applies to companies like Alphabet, Meta and Amazon. It affects companies with global revenues over £500 million and is levied on parts of turnover exceeding £25 million in the country.

Nvidia and AMD to pay 15 percent of China revenues to US

Donald Trump's USA

Published 13 August 2025
– By Editorial Staff
Lisa Su, CEO of AMD, holds up an AMD Zen 5 chip during the presentation of next-generation processors at Computex 2024 in Taipei, Taiwan.
2 minute read

American semiconductor manufacturers Nvidia and AMD have agreed to pay 15 percent of their revenues from chip sales in China to the US government. The arrangement is the condition for obtaining export licenses under President Donald Trump’s administration.

According to sources familiar with the situation, including a US government official, both companies approved the financial arrangement to obtain export licenses for the Chinese market, which were granted last week.

The American official stated that Nvidia agreed to share 15 percent of revenues from H20 chip sales in China, while AMD will provide the same percentage from MI308 chip revenues. The Trump administration has not yet decided how the money will be used, reports Financial Times.

Never seen before

According to export control experts, this is the first time ever that an American company has agreed to pay a portion of its revenues to obtain export licenses. However, the arrangement fits into a pattern under the Trump administration where the president urges companies to take actions, such as domestic investments, to avoid tariffs.

The Commerce Department began issuing H20 export licenses on Friday, two days after Nvidia CEO Jensen Huang met with President Trump. The administration has also begun issuing licenses for AMD’s chips to China.

Nvidia did not deny the arrangement and said: “We follow rules the US government sets for our participation in worldwide markets”. AMD commented: “Our initial licence applications have been approved” and added that the company “adhere to all US export control laws and policies”.

Criticism from security experts

The decision to sell the chips to China has drawn criticism from American security experts who argue that the H20 chip will help the Chinese military and undermine US strength in artificial intelligence.

— Beijing must be gloating to see Washington turn export licences into revenue streams, says Liza Tobin, a China expert who served on the National Security Council during Trump’s first administration.

In a letter to Commerce Secretary Howard Lutnick, Matt Pottinger, former deputy national security advisor, and 19 other security experts warned against granting H20 licenses. They called the H20 a “potent accelerator of China’s frontier AI capabilities”.

Nvidia dismissed the criticism as “misdirected” and rejected that China could use the H20 for military purposes.

The debate comes as the US and China hold trade talks that Trump hopes will pave the way for a summit with Chinese President Xi Jinping.

Trump deploys National Guard to “liberate” Washington

Donald Trump's USA

Published 12 August 2025
– By Editorial Staff
President Trump announces that 800 National Guard soldiers will initially be deployed to combat crime and restore order in Washington, DC.
4 minute read

At a press conference on Monday, US President Donald Trump announced a massive operation to combat crime in Washington, DC.

As part of the measures, the city’s police will be placed under federal control, and hundreds of National Guard soldiers will patrol the streets to make the city safer. Trump simultaneously warned that New York could be next for similar measures.

— I’m announcing a historic action to rescue our nation’s capital from crime, bloodshed, bedlam and squalor – and worse. This is liberation day in DC and we’re going to take our capital back, Trump said during a press conference at the White House.

The president expressed frustration over what he described as the growing crime in the city.

— Our capital city has been overtaken by violent gangs and bloodthirsty criminals, roving mobs of wild youth, drugged-out maniacs and homeless people, Trump said and continued: “And we’re not going to let it happen anymore. We’re not going to take it”.

Trump noted that the operations would begin quickly, in the same way as the measures taken at the southern border to stop illegal immigration. “We’re going to clean it up real quick, like we did on the southern border”, he clarified.

“Will be tough”

According to US legislation, the Home Rule Act of 1973, the president has the right to take control of Washington’s police force for up to 30 days, with the possibility for Congress to extend the measures. The Trump administration has sent documents formalizing the takeover to Congress, and later in the day, DC’s police chief and other federal officials met to discuss next steps.

— This will be an opportunity for us to come together and collaborate on being able to go out and execute warrants, said MPD Police Chief Pamela Smith.

Defense Secretary Pete Hegseth clarified in an interview that the National Guard will not just be present but will act proactively in their operation.

— They will be strong, they will be tough and they will stand with their law enforcement partners., Hegseth said, adding: “If you take an action or a shot at them, there will be a consequence”.

“Doubled up on Baghdad”

Trump defended his decision and showed a chart during the press conference comparing murder statistics per capita in Washington, DC with the capitals of cocaine-exporting Colombia, Mexico and Iraq.

— We doubled up on Baghdad, he claimed, describing the situation as “completely unacceptable”.

— They’ll immediately begin massive enforcement operations targeting known gangs, drug dealers and criminal networks to get them the hell off the street, Trump said. He also suggested that certain criminals, whom he claimed came to the US illegally, will be deported.

Photo: screenshot/Truth Social/Trump

— They come from Venezuela, they come from all over the world. We’re going to get them the hell out, he explained.

The National Guard will also assist in a larger operation to remove homeless camps from public places, including parks and underpasses.

— We’re getting rid of the slums, Trump promised and mentioned that beautifying the city’s public areas and repairing median strips and potholes are part of the operation.

“False numbers”

DC Mayor Muriel Bowser, who is a Democrat, confirmed that she will comply with the federal operations but expressed concern that Trump’s decision represents a major interference in local self-governance.

I’m going to work every day to make sure it’s not a complete disaster, Bowser said, claiming to be particularly concerned about the presence of plainclothes law enforcement personnel.

— All law enforcement be identifiable by uniform, a badge, a jacket, so that people know that they are law enforcement.

Trump addressed the criticism and responded in his way.

— I know it’s not politically correct. We’re going to get them the hell out. They won’t be here long,

New York next?

Defense Secretary Hegseth also clarified that soldiers from other states will assist in the operation.

— They will be standing right alongside our federal agents, like they were in Los Angeles. They’re going to be proactive.

Trump also mentioned that he is looking at other cities that may need similar federal operations.

— You look at Chicago, how bad it is. You look at Los Angeles, how bad it is. We have other cities that are very bad. New York has a problem, Trump said, suggesting that more cities may receive federal support if the situation doesn’t improve.

The president also took the opportunity to express his long-term visions for the city.

— Washington, DC, should be one of the safest, cleanest and most beautiful cities anywhere in the world, and we’re going to make it that, Trump summarized and promised that he intends to “clean it up real quick”.

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