Factory building slumps as Trump takes ‘illegal’ tariffs before Supreme Court

(Originally published Sept. 3 in “What in the World“) U.S. manufacturing still isn’t giving Trump the revival he said tariffs would bring.

The Institute for Supply Management’s purchasing managers index suggested that manufacturing shrank in August for the sixth straight month. The ISM’s PMI, compiled from its regular survey of manufacturing supply executives, was 48.7 in August, compared with 48 in July. Any number below 50 suggests contraction.

And while spending to build new factories and offices continues to rise on a nominal basis, once adjusted for inflation, it’s clear that real investment is slumping. Spending to build new factories has fallen by more than 7% since its peak last year, according to economists at RSM.

Source: The Real Economy Blog

Trump, meanwhile, said he would seek an “expedited” review by the Supreme Court of a May ruling by the Court of International Trade that his “reciprocal” tariffs aren’t legal. Last week, U.S. Court of Appeals for the Federal Circuit in Washington, D.C., upheld the trade court’s ruling, but allowed the tariffs to stay in place until mid-October to give the Supreme Court a chance to hear the case itself. Trump called the appeals court ruling “an emergency,” particularly as investors worried Washington might have to refund the customs duties it’s collected so far. “If you took away tariffs,” Trump said, “we could end up being a third-world country.”

Apparently that’s exactly what investors think Trump is turning the U.S. into.