U.S. Trade Representative Robert Lighthizer and U.K. Secretary of State for International Trade Elizabeth Truss announced today [joint statement] the beginning of a series of fast-tracked trade negotiations toward a new free trade agreement. [USTR Release]

In the foreground is a trade agreement between the U.S. and the United Kingdom. However, in the more strategic background context these negotiations create leverage for the U.K. in their post-Brexit negotiations with the European Union. First from today:

LIGHTHIZER – […] The US negotiating team will be led by Dan Mullaney, Assistant U.S. Trade Representative for Europe and the Middle East; and the UK negotiating team will be led by Oliver Griffiths, Director for US Negotiations at the Department for International Trade. Over 200 staff from U.S. and UK government agencies and departments are expected to take part in the negotiations.

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White House Manufacturing Policy Advisor and lead on execution of the Defense Production Act, Peter Navarro, appears on Fox News to discuss the ongoing initiatives to secure, produce and/or manufacture critical healthcare products in the U.S.

There are multiple reports in media today about the White House assembling a variety of new policies and regulations to go full wolverine on ‘America-First’.  USTR Lighthizer, Treasury Secretary Mnuchin and Commerce Secretary Wilbur Ross are leading the effort.

Additionally, Navarro notes FEMA, HHS and DoD will soon have rules requiring USA manufactured purchases for their government contracts.

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Wall Street’s U.S. multinationals moved the majority of U.S. apparel manufacturing to southeast Asia for the past several decades; as a result they virtually wiped out major apparel hubs in the United States.  Now those same multinationals are claiming their production shift to making masks and PPE in China means the tariffs on imports should be lifted; and they are sending their corporate lobbyists into DC to pitch that message.

Nonsense.

There are no tariffs on U.S. healthcare products made in the USA.  If the apparel industry wants to avoid tariffs, then bring the manufacturing back home.  Critical manufacturing in the United States is what U.S. consumers of those and other goods want.

President Trump should not lower tariffs on imported PPE, he should actually raise those tariffs as high as needed to shift that manufacturing back to the U.S.

The time is now to wage battle against the Wall Street manufacturers & K-St lobbyists.

WASHINGTON (Reuters) – The Trump administration is “turbocharging” an initiative to remove global industrial supply chains from China as it weighs new tariffs to punish Beijing for its handling of the coronavirus outbreak, according to officials familiar with U.S. planning.

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Treasury Secretary Steven Mnuchin appears for a wide-ranging interview with Maria Bartiromo. Topics include international travel, the Paycheck Protection Program progress, small business relief, and overall rebuilding of the U.S. economy amid COVID-19 mitigation.

The first few minutes of the interview are weird because Bartiromo doesn’t seem to recognize the PPP program is essentially a grant to small business to keep their employees on payroll. Ms. Bartiromo appears to want the PPP grants to be shifted to free money to replace business revenue, and she’s pushing hard for her Wall St buddies.

Secretary Mnuchin tries to remind Bartiromo that businesses can apply for bridge loans, but the PPP is actually a grant. Bartiromo argues that all businesses should have free money bailouts to replace revenues; an impossible suggestion.

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White House Advisor to the President Kevin Hassett discusses the importance of using May to get as many states open as possible.  The President has asked for data daily to measure the amount of the economy that is reopening.  As the economy opens there’s less need for a ‘phase-4’ relief/bailout bill.

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National Economic Council Director Larry Kudlow appears on CNBC to answer growing questions about whether there is a White House plan to punish China.  Kudlow is careful to tamp down any specific reports, while affirming there will be retaliatory measures.

Additionally, Director Kudlow discusses the status of the economy, the current claims under the Payroll Protection Program, and what efforts might yet come.

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Amid another troubling week for initial unemployment claims showing 3.8 million workers filing for financial assistance President Trump’s Senior Economic Advisor Kevin Hassett appears on Fox News to discuss the status of the economic shut-down.

Hassett notes his current estimate for total workforce unemployment around 19 percent. Additionally, Hassett outlines how the economic data lags the economic activity, so there is much more bad news to come.   That said, with massive influx of federal spending to fill the gap, the White House has now shifted focus toward how best to reignite the economy.

Kevin Hassett has a forward outlook of optimism and notes there is pent-up demand which can re-launch the economy. The economy was so strong prior to the shutdown it is possible to look forward and remain optimistic.

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President Trump participates in a roundtable discussion with various industry executives on the plan for reopening the American economy. Anticipated start time 4:00pm ET.

White House Livestream Link – Fox News Livestream – RSBN Livestream

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National Economic Council Director Larry Kudlow argues the worst of the coronavirus pandemic is over and the U.S. economy is getting ready to reopen. Kudlow outlines the scale of the current economic relief package how any further discussion should focus on policies to launch the economic recovery.

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The Bureau of Economic Analysis (BEA) released the first quarter Gross Domestic Product (GDP) advanced estimate and the result is a 4.8% decline in economic activity. [BEA Here]

The revised fourth quarter GDP shows the economy was growing at 2.1 percent prior to the COVID-19 shutdown.  The severity of the change in GDP reflects a severe drop in consumer spending, essentially bringing the economy to a halt in March as the entire nation went into lock-down.  As the BEA explains:

The decline in first quarter GDP was, in part, due to the response to the spread of COVID-19, as governments issued “stay-at-home” orders in March. This led to rapid changes in demand, as businesses and schools switched to remote work or canceled operations, and consumers canceled, restricted, or redirected their spending.

The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the first quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified. (more)

Digging down into the details the data shows what we all have seen.  There is some specific data that is noteworthy in the tables.

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