Extract from ABC News
The blood smeared face of Donald Trump, clenched fist raised against the background of the stars and stripes may be the defining image of his campaign and an enduring portrayal of our times.
But his legacy, should he become president, will be the costs of his long held ambition to ramp up his trade wars and against the world and particularly China.
While it hasn't received much attention, a second Trump administration is threatening a high stakes gamble to revive America's economy by erecting walls around the country's manufacturing base.
For a nation almost drowning in debt, much of it accumulated during his first term, the potential for a misfire is huge and he runs the risk of creating a new and dangerous inflation outbreak.
Trump's power base is entrenched in the disaffected and largely forgotten American industrial heartland, among those left behind by the sudden shift towards a global economy.
The former president's great plan is to return America to an undetermined time, somewhere in the past when the country's industrial might made it a force to be reckoned with.
To achieve that, he plans to wind back the clock on trade.
He dipped his toe in during his first term, slapping on tariffs to protect US steel and aluminium and a 10 per cent tariff on a range of Chinese goods.
This time around, if he makes it to the White House, he plans to go much further with a blanket 10 per cent tariff on all imports and up to 60 per cent on Chinese goods.
It's an easy sell to a disillusioned electorate that has suffered a steady decline in living standards over the past four decades dogged by rising crime rates, poor employment prospects, low wages, poor education and drug epidemics.
But will a sudden lurch back to protectionism fix the problem? Will all those long departed dirty industries return to the US?
Or will the new policy merely ratchet up the cost of living and put even more people out of work once other nations slap their own trade bans on the US?
The trickle down ruse
The 1980s heralded a new economic order. Trade barriers across the developed world were dismantled, taxes were cut and government spending was reduced.
Competition would lift efficiency, goods and services would be cheaper and everyone would benefit as the wealth trickled down through society.
It was the era of Thatcherism and Reaganomics.
On an aggregate level and on averages, it all went according to plan.
The global economy expanded at a rate never before seen and incomes, particularly in developing nations and especially in Asia, rose dramatically.
China, in the space of one generation, transformed itself from a dirt poor agrarian society into a highly urbanised and sophisticated industrial giant.
Gleaming towers and city landscapes replaced largely subsistence dirt poor farmers.
America changed too. Its industry shifted from smoke stacks to hi-tech, from production to design, all while its financial giants dominated global wealth flows.
Ordinary folk, at least those that remained employed, did well out of the arrangement when it came to the cost of living. Everything from clothes and footwear to vehicles and food became cheaper.
But most of that extra wealth, rather than trickle down, remained firmly stowed away in the upper reaches of American society.
The textbooks were right about the growth in wealth. But the politicians forgot about the distribution.
Now, the US is paying the price.
Around a quarter of all Americans have no retirement savings, while deaths per head of population from drug overdoses, alcohol and suicide have more than doubled since 1980.
Life expectancy among Americans is well below that of comparable countries such as Australia, Japan, Canada and northern European nations. Even worse, unlike its peers, the US has gone backwards, to where it was 20 years ago.
Its jails, however, are full. Incarceration levels at the sixth highest in the world, behind El Salvador, Cuba and Rwanda.
It didn't take much for Trump to tap into that rich vein of discontent.
They didn't work first time around. Let's go bigger
Donald Trump's former trade chief Robert Lighthizer recently penned a piece for The Economist, an unapologetic advocate for free trade, on the benefits of tariffs.
Unsurprisingly, Lighthizer is a fan.
Tariffs, he argues, have economic, geopolitical and moral benefits.
But tariffs are dangerous for a number of reasons.
The costs are never obvious because they largely are picked up by consumers and, once employed, they are politically difficult to remove because they are favoured both by workers and business.
If you are going to support an industry, subsidies or some other form of direct aid is preferred, primarily because politicians have to justify the expense each year.
Some independent research on the impact of the first round of Trump's tariffs found they were an unmitigated failure.
The Harvard Times recently interviewed Gordon Hanson who penned a research paper for the National Bureau of Economic Research.
According to Hanson, US output didn't rise after the tariffs were put in place and any increase in sales largely was the result of higher prices.
Hence, there was no lift in employment.
In any case, American firms and consumers simply shifted their buying to other countries like Vietnam.
Most importantly, however, he argues that the world has changed.
"The types of jobs that the US lost to import competition from China in the 1990s and 2000s are quite different from the types of jobs that would be created if those same industries were to expand operations today.
"Modern technology in those same industries has replaced labour with capital, meaning that compared with the past, every extra dollar of output you produce requires fewer workers," he explains.
What did have an impact on the US economy was China's retaliation, hitting US farm goods which struggled to find alternative markets.
"For reasons we don't fully understand, higher tariffs in China didn't divert US exports of farm products to other countries," Hanson says.
"The result was simply a decline in US farm exports, farm jobs and jobs in farm regions."
Risk of backfire
Trade bans, and tariffs in particular, target trade.
They don't target employment or investment.
And they can backfire, in spectacular fashion.
Just ask Beijing after it shot itself in the foot with its trade war on Australia.
While the bans affected Australia in the short term, most exporters found alternative markets.
China, meanwhile, found itself short of coal with power outages across large parts of the country.
It was forced to pay higher prices for sub-standard coal while the demand for Australian coal rose.
This graph illustrates how Australian barley farmers responded to the bans.
They found other markets and exports expanded.
China's relaxation of its trade stance wasn't so much an act of diplomacy as relations defrosted but more an admission of failure.
That hasn't deterred the former US president.
Despite having an overall negative impact on the US economy, Trump plans a radical expansion of his previously failed policies that could rewrite global trade conventions and cause serious political and economic dislocations.
If everyone retaliates, goods will generally become more expensive which will make it difficult to bring inflation under control in the medium to longer term.
But it won't be an easy shift. Prepare for shocks, particularly if the US electorate discovers the promises can't be kept.
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