JPMorgan Chase CEO Jamie Dimon said Wednesday that increased costs from looming tariffs could be worth it if they protect national security.
Mr. Dimon, who runs the largest U.S. bank by assets, said tariffs are an economic tool that could spur inflation, but it depends on how they are used.
“If it’s a little inflationary, but it’s good for national security, so be it. I mean, get over it,” Mr. Dimon told CNBC on the sidelines of the World Economic Forum in Davos, Switzerland. “National security trumps a little bit more inflation.”
Mr. Trump has threatened to impose a 25% tariff on goods from Canada and Mexico by Feb. 1 if they don’t rein in illegal immigration. He also proposed a 10% tariff on China by that date.
“We’re talking about a tariff of 10% on China based on the fact that they’re sending fentanyl to Mexico and Canada,” the president told reporters late Tuesday.
He also complained about trade imbalances with Europe, saying the European Union has been “very, very bad to us.” Officials in the EU and other places have threatened to respond with retaliatory measures.
Tariffs are a form of tax or duty paid on imports. Mr. Trump says tariffs are a great way to force companies to return to America or keep their operations in the U.S., employ American workers and create revenue to fund domestic programs.
The U.S. relied on tariffs as a primary source of government revenue until the federal income tax was imposed in the early 20th century.
Foreign countries don’t pay the tariffs directly to the U.S. Treasury. Companies pay the levies and often pass at least some of the cost to consumers through higher prices.
Recent presidents have used tariffs to protect specific industries, such as steel and aluminum, from foreign nations that dump cheap goods into the U.S.
Mr. Dimon suggested the tariffs can be useful if used wisely.
“I look at tariffs, they’re an economic tool, That’s it,” Mr. Dimon said. “They’re an economic weapon, depending on how you use it, why you use it, stuff like that. Tariffs are inflationary and not inflationary.”
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.