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Billionaire John Paulson softens Trump's wage talks

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Billionaire hedge fund founder John Paulson predicted that former President Donald Trump would impose targeted tariffs on specific industries rather than Trump's proposed universal tariffs – as Paulson is nominated to be a possible Trump Treasury secretary.

Important facts

Paulson told Semafor in an interview published Friday that “it makes sense to target the bulk of tariffs on industries that face unfair trade competition” and “that are strategically important to both industry and defense.”

Asked whether he thought Trump would “go in a more targeted direction” instead of imposing the universal tariffs he proposed, Paulson replied “yes.”

Paulson acknowledged that Trump's proposals “would lead to higher import prices,” but said Trump's tariff proposal “supports domestic manufacturing so there are more jobs, more investment in the U.S., and more taxes.”

Paulson has repeatedly praised Trump's tariff plans, predicting in a September Wall Street Journal editorial that they would “generate around $450 billion in revenue,” while calling existing trade policies “one-sided” because the U.S. has lower tariffs than other countries raise.

Paulson also told Semafor he is “ready to serve in any capacity.” [he] could be helpful” in Trump’s administration when asked about serving as Treasury secretary, as Trump has reportedly highlighted his name in conversations with confidants about potential Cabinet appointments.

Forbes rating

We estimate Paulson is worth $3.8 billion.

Crucial quote

“It's time for it us “To retaliate against the unfair trade practices we face and respond with reciprocity,” Paulson told Semafor when asked if he was concerned about retaliatory tariffs under Trump, noting: “As Tesla cars to China Wanted to sell, that was not allowed” and instead “forced to build a factory in China to sell cars in China.”

tangent

Paulson, a major fundraiser for Trump, has threatened to withdraw his money from the stock market if Harris is elected, he told Fox Business in September, citing Harris' proposal to curb price gouging, increase the corporate tax rate and possibly taxes to increase unrealized capital gains, a proposal that President Joe Biden supports but that Harris has not made clear whether she would implement.

Important background

Trump has not officially committed to any specific tariff policy, but he has proposed increasing tariffs by 10% on all imported goods and by 60% on goods imported from China. Most experts say the cost of the tariffs would be borne by a combination of U.S. companies importing goods, consumers and foreign exporters. In general, economists believe Trump's tariff plan would harm the U.S. economy by reducing consumer spending, increasing the unemployment rate and reducing economic growth.

Updated: The headline of this story has been updated to reflect Paulson's comments.

Further reading

Will Trump's tariffs raise prices? What to Know as Kamala Harris Criticizes Politics at Debate (Forbes)

How the economy really fared under Biden/Harris and Trump – from jobs to inflation (Forbes)

Kamala Harris Is Backed by More Prominent Billionaires Than Trump – Buffett and Gates Speak Out (Updated) (Forbes)

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