Investing.com

President-elect Donald Trump's former US Trade Representative Robert Lighthizer, along with associates, is preparing to advocate for aggressive tariffs, according to Politico.

Citing a document, the report indicates that Lighthizer and his allies have circulated memos to persuade lawmakers and the public that higher tariffs will stimulate economic activity instead of hindering it.

During his campaign, Trump proposed implementing blanket tariffs of up to 20% on imports to the US and a 60% duty on Chinese goods.

Despite concerns that tariffs might reignite inflation, a policy planner noted that Lighthizer’s team will argue that existing economic models have failed to predict economic changes accurately.

The circulated document references a study by the US International Trade Commission, which indicated that the tariffs imposed during Trump's first term boosted domestic production across all industries.

Additionally, Lighthizer and Trump's transition team are in discussions with Congressional staff about possibly securing support for the incoming administration's tariff policies through legislation. This move would break from the precedent established by both Republicans and Democrats, making it more challenging for future presidents to overturn the tariffs.

Congress has not imposed a tariff in nearly a century, typically allowing the president to impose such measures only under extraordinary circumstances.

Lighthizer has also been mentioned as a potential candidate for key economic positions in the new Trump administration, including Secretary of Commerce, Treasury, or a senior adviser role.

In a note to clients, analysts at ING remarked that Lighthizer's return to US economic policymaking highlights an impending shift towards protectionism.