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President Donald Trump refueling trade tensions threatening to impose a 50% tariff on goods from the EU, as well as 25% tariffs on Apple's iPhones. The levies on the EU would take effect on June 1st. Trump saying in a post on Truth Social that talks are going nowhere. Then joining us now, we've got Sheik Abus who is the Director of Economic Policy at Bipartisan Policy Center. Good to have you here with us. Just take us into your reading now on the latest on some of the trade policy and I guess strategic chaos has it's been talked about by some of the administration members.

Yeah, well, thanks for having me. The what we've seen in the tariff um policy over the last several months has been really driving the uncertainty in the economy. And from a business standpoint, from a consumer standpoint, and it's very understandable that there are goals that these tariffs that we have with these tariffs that we are trying to renegotiate trade deals that have been placed for many years, get more fair trading relationships. Uh we understand the administration's goals to bring back some of the uh manufacturing to the United States. Those can be accomplished in a variety of ways, but when we are seeing these fluctuations in tariff policy, it makes it impossible for small businesses, especially to plan how they're going to conduct their business. It makes it very difficult for consumers who hear that inflation might be coming and making big purchasing decisions around that. So I think it will be important for some of this uncertainty to settle down over time if we're going to see the strong robust economic growth that we all want to.

Is that uncertainty going to settle down anytime soon in your view?

Well, it depends on what the administration's policy is. We've seen tariff rates go up and then they come back down, and then they tariffs get put back on, and then they take taken off. And that is really challenging for to fostering growth in the economy. Uh it'll really be up to the administration and the negotiations that they are undertaking right now with many countries across the world, and we'll have to see what those tariff rates end up at. We are right now at 10% across the board and higher on China, uh Canada and Mexico, and then there are these uh potential additions that you just mentioned at the top. If those all go up, then I think we're in for a difficult second half of the year for the economy. If we settle into a more uh natural state of equilibrium, even if that includes some tariffs, I think people will feel more confident about planning for the future.

I I thought the tariffs were supposed to offer the tax cut.

So this is another challenge, which is that we've heard competing visions and goals for what the purposes of these tariffs are. That the president has said that he wants to bring in a massive amount of revenue from the tariffs. We've seen a little bit of revenue come in. We have a tracker that that shows that tariffs are coming in at higher rates than they were in previous years, but nothing that's going to materially change our fiscal challenge. And that is at odds with the uh purpose of the tariffs to incentivize renegotiations of the trading relationships that will result in more free trade. Because of course, if we get free your trade and tariff rates come back down, they're not going to bring in that revenue that's being discussed. So we'll have to see where those two competing priorities uh leave us, but I think the bottom line for the fiscal situation, which is getting quite dire in this country, is it's unlikely that tariffs are going to play a major role in getting us out of the situation that we've gotten ourselves into.