(Bloomberg) -- Lloyd Blankfein said raising tariffs might be an appropriate tactic to use against China in the latest sign of widening American support for President Donald Trump’s tough approach.
“Tariffs might be an effective negotiating tool,” Blankfein -- a regular attendee of annual Davos conferences in Switzerland when was chief executive officer of Goldman Sachs Group Inc. -- wrote in a Twitter post Tuesday. “Saying it hurts us misses the point. China relies more on trade and loses more.”
While economists and business lobbies have been critical of Trump’s tariffs, saying the American consumer will end up footing much of the bill, the Republican president’s moves have in the past drawn praise from some Democratic legislators including Senate Minority Leader Chuck Schumer.
And although there have previously been sharp divisions between top economic officials including Treasury Secretary Steven Mnuchin and White House adviser Peter Navarro, current and former administration officials now say there’s been a general hawkish tilt over time.
Blankfein, who now serves as Goldman’s senior chairman, once envisioned a reformist China increasingly opening up to the global economy. He said on a Davos panel in 2014 that China was on “a march toward privatization. We’re all excited and enthusiastic about that. And the Chinese recognize that that’s the way.”
“The global interest may require a kind of an integrated system where an aberrational player that has so much national intervention in its businesses may not fit,” Blankfein said five years ago.
Blankfein After 2018 Davos:
Even though there has been some opening, including in the financial sector, President Xi Jinping has also strengthened the Communist Party’s role and that of state-owned enterprises.
Fast forward to Tuesday, and the former Goldman banker now says tariffs are “not great but part of the process to assert pressure to level the playing field.”
--With assistance from Nathan Crooks.
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