Trump Administration Commerce Secretary: "Trump's Universal Tariffs Deal $1 Trillion Blow to Global Trade"

Wilbur Ross, who served as the U.S. Secretary of Commerce during former President Donald Trump's administration, warned that if Trump's campaign pledge of a 'universal tariff' as the Republican presidential candidate becomes a reality, it could deal a $1 trillion (approximately 1,359 trillion KRW) blow to global trade.

Wilbur Ross, former U.S. Secretary of Commerce

In an op-ed titled "America's Trade Deficit Is Not Trump's or Biden's Fault, but the World Trade Organization's Problem," published on the 14th (local time) in the U.S. political media outlet The Hill, former Secretary Ross stated this. He said, "The universal tariff proposed by Trump is likely to force the U.S. to withdraw from the WTO," and predicted that "it would be catastrophic for most WTO member countries."

Ross expressed concern, saying, "The United States, the world's largest importer, could inflict nearly $1 trillion in damage to global trade," adding, "This would be much greater than the damage to us (the U.S.)." Former President Trump has repeatedly emphasized his plan to impose a universal tariff of 10-20% on all imports ahead of the November election.

Former Secretary Ross also mentioned that the Great Depression had already begun in the U.S. before the enactment of the Smoot-Hawley Tariff Act, which is considered a precursor to the Great Depression, suggesting that "while such drastic measures are risky, they are less dangerous to us than to other countries," implying that the impact on the U.S. would be limited.

In this op-ed, Ross pointed out that the root cause of America's chronic trade deficit lies with the WTO and devoted most of the article to the need for WTO reform. He argued, "As the 2024 election season heats up, the U.S. trade deficit of $785 billion will become a 'hot potato,'" and stated, "It is easy to blame the Trump or Biden administrations, but the real culprit is the WTO."

In particular, Ross criticized the WTO, which was established to ensure a fair and free global trade environment, for not fulfilling its role properly, citing as a serious problem the fact that countries can self-declare developing country status. He said, "Because there are no strict standards, 80% of WTO members, including China, the world's second-largest economy, claim to be developing countries," and pointed out, "As a result, the U.S. records its largest trade deficit with China while having to make trade concessions to China, which is classified as a developing country." He added, "Our negotiators agreed to these WTO rules decades ago, but what was acceptable then has become a serious problem now."

Furthermore, Ross criticized the WTO's dispute resolution process for lacking neutrality. He said, "The U.S. has been the defendant in about 25% of WTO dispute cases and has lost 90% of them," sarcastically noting, "It is ridiculous that the U.S., which has the largest trade deficit, is the biggest violator of international trade regulations."

He also mentioned the slow enforcement of dispute resolution procedures even in cases with clear regulations as another problem of the WTO. The subsidy dispute between Boeing and Airbus, which took more than 17 years, is a representative example. This has rendered dispute resolution practically meaningless, and countries are reluctant even to raise issues. Ross emphasized, "The WTO's flaws do not end here," adding, "It also fails to address major issues related to currency manipulation, intellectual property rights, and barriers in the service industry."

He continued, "Trump expressed his intention to take a tough stance on the WTO, while Democratic candidate Kamala Harris (Vice President) has not yet detailed her trade policy, but it would be wise to advocate for WTO reform," and argued, "Solving the trade deficit issue should not be a partisan matter. It is a national duty."

This content was produced with the assistance of AI translation services.