Automakers Take Aim at Emissions Standards, U.S. Economy Could Suffer More Than Chinese In Trade War
February 13, 2017
Several major automakers are asking President Trump to reduce emissions standards for vehicles; U.S. could suffer a greater economic shock than China in a trade war.
- The heads of several major automakers are asking President Trump to reconsider greenhouse gas standards for vehicles instituted during the Obama administration. Automakers urged the Obama administration to consider weakening fuel efficiency standards that aim to achieve 54.5 miles per gallon by 2025, saying Americans’ tendency to buy large vehicles makes it difficult to improve fuel efficiency industry-wide. In January, shortly before Trump took office, the Obama administration decided it would not change the standards, saying they will cut down on fuel costs for drivers and reduce greenhouse gases. [The Hill]
Economic Indicators & News
- The U.S. could suffer a greater economic shock than China in a trade war. Some economists figure a 45% tariff on Chinese imports and 35% fees on goods from Mexico translate into an effective tariff rate of around 11%, given their share of total U.S. trade. Assuming Beijing and Mexico City retaliate with equivalent tariffs, Nicholas Fawcett, a senior global economist with Goldman Sachs, estimates it could depress U.S. gross domestic product by 0.7% point by 2019. That’s more than twice the hit on China’s growth, at 0.3 percentage point. [WSJ]