Gary Cohn bemoans 'dramatic impact' of Trump tariffs

The former top White House economic adviser said that President TrumpDonald John TrumpWarren defends, Buttigieg attacks in debate that shrank the field Five takeaways from the Democratic debate in Ohio Democrats debate in Ohio: Who came out on top? MORE’s trade wars have had a “dramatic impact” on the U.S. manufacturing sector while doing little to hinder China’s economy.

Gary CohnGary David CohnTrump says US will hit China with new round of tariffs next month Gary Cohn bemoans 'dramatic impact' of Trump tariffs Press: Acosta, latest to walk the plank MORE, former director of the National Economic Council, told the BBC in an interview aired Thursday that Trump’s tariffs have effectively canceled the benefits of his 2017 corporate tax cut and prevented U.S. manufacturers from expansion.

"When you build plant equipment, you're buying steel, you're buying aluminum, you're buying imported products and then we put tariffs on those, so literally the tax incentive we gave you with one hand was taken away with the other hand,” Cohn told the BBC.

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"So we are not seeing the manufacturing job creation. And I think if we get through this tariff situation, there's a real opportunity to see it here in the United States."

Cohn, a staunch free-trade advocate, announced his resignation in March 2018 after Trump imposed tariffs on imported steel and aluminum. The former Goldman Sachs president and registered Democrat clashed frequently on trade with Trump and his hardline protectionist advisers.

"I think everyone loses in a trade war. We are an 80 percent service economy. The service side of the economy is doing very well, because, guess what, it's not being tariffed,” Cohn said. 

Since Cohn’s departure, Trump has imposed tariffs on $250 billion in goods from China, has floated another tranche on roughly $300 billion in Chinese products and is considering import taxes on foreign autos. Trump also threatened to tariff all Mexican goods over immigration concerns, but has stood down from that threat.

Trump has argued that the U.S. is benefiting from his tariffs through taxes taken in by the Treasury Department, which are being paid by U.S. importers and consumers. The president also attributes a sharp slowdown in China to his trade policy.

While the yearlong trade war has hindered China’s economy in some ways, Cohn said that the country was due for a slowdown regardless of Trump’s tariffs.

"I think the Chinese economy was going to slow down with or without a trade war," Cohn said, ceding that Trump was right to target the country’s alleged theft of intellectual property.

Cohn’s comments come a day after his former colleagues, Treasury Secretary Steven MnuchinSteven Terner MnuchinThe Hill's Morning Report - Trump grapples with Turkey controversy Trump hypes China trade deal as new doubts emerge Overnight Defense — Presented by Boeing — Trump to slap sanctions on Turkey for Syria offensive | Trump calls on Turkey to broker ceasefire | Pelosi, Graham seek deal on sanctions | Ex-Trump aide testifies in impeachment probe MORE and U.S. Trade Representative Robert LighthizerRobert (Bob) Emmet LighthizerOn The Money: Economy adds 164K jobs in July | Trump signs two-year budget deal, but border showdown looms | US, EU strike deal on beef exports Chinese, US negotiators fine-tuning details of trade agreement: report The Trump economy keeps roaring ahead MORE, concluded a round of trade talks with Chinese officials in Shanghai. Negotiations are set to resume in Washington in September.