Trump’s tariffs ignite a trade war with allies
The Trump administration sparked a trade war with America’s closest allies this week, after it imposed steep tariffs on imports from Canada, Mexico, and the European Union—which immediately retaliated with targeted tariffs on U.S. products. Trump’s tariffs, 25 percent on steel and 10 percent on aluminum, were first announced in March, but the administration gave several key allies temporary exemptions while they negotiated deals with the U.S. When those talks failed to make rapid progress, Trump ordered the duties imposed. “The U.S. has been taken advantage of for many decades on trade,” the president said. “Those days are over.” Canada, Mexico, and the EU retaliated quickly, announcing nearly $20 billion worth of import duties in total on U.S. goods, including pork, steel, bourbon, peanut butter, and orange juice. Some prominent Republicans attacked Trump’s tariffs as wrongheaded. “This is dumb,” Sen. Ben Sasse (R-Neb.) said. “You don’t treat allies the same way you treat opponents.”
Trump insisted that the tariffs were needed to protect U.S. national security interests, a claim that Canadian Prime Minister Justin Trudeau called “insulting” to the thousands of Canadians who had “fought and died” alongside American GIs from World War II to Afghanistan. The dispute all but guarantees that Trump will get a frosty reception at the G-7 summit in Canada this week, which will be attended by leaders from many of the nations hit with tariffs.
This trade war will put Trump’s “solid economic record” at risk, said The Wall Street Journal. American firms that rely on complex cross-border supply chains will have to swallow the tariff costs, and so they’ll likely hire fewer workers and pay lower wages. As for Trump’s claim that the duties are vital for national security, that’s nonsense. Canadian steel and aluminum are integral to U.S. national defense. His duties will make our planes and tanks more expensive, giving “Russia an advantage in international arms sales. Brilliant.”
The tariffs were “met with cheers in the industrial Midwest,” said the St. Louis Post-Dispatch. But those same states are full of farmers who will bear the brunt of the retaliation. Mexico, the second-largest export market for U.S. pork, slapped a 20 percent duty on U.S. pork, which could mean U.S. farmers will lose business to other, cheaper foreign producers. It’s not just farmers who will feel the hurt. One study suggests a trade war could cost the average U.S. family $210 a year, “wiping out most benefits of the tax bill passed last December.” The GOP could end up paying for that pain in the midterms.
“What’s the modern case for tariffs?” asked James Fallows in TheAtlantic.com. They’re a useful tool when you want to coerce another country into changing its behavior. Yet Canada, Mexico, and the EU “aren’t doing anything about steel or aluminum that the U.S. could plausibly call wrong or unfair.” Sure, they sell a lot of metal here, but that’s no more unfair than the U.S. selling a lot of soybeans to Japan or airliners to China. If the goal is to somehow reduce trade deficits, these tariffs will be “laughably ineffective.”
There’s one consequence we can be sure of, said Bonnie Glaser in The New York Times: The tariffs will make it harder to counter China. Trump is playing into Beijing’s portrayal of the U.S. as a “unilateral disrupter” and undermining the free-trade system the U.S. has led since the end of World War II. As an ambitious, rising China promotes its model of authoritarian, state-run capitalism around the world, the U.S. can fight back only “through coordination with allies”—the very allies Trump is alienating.
It’s not enough for lawmakers to criticize Trump—they need to “take back control of trade policy,” said Clive Crook in Bloomberg.com. The Constitution vests Congress with the power to regulate international commerce, and Sen. Bob Corker (R-Tenn.) introduced a bill this week to constrain the president’s tariff powers. Yet few Republicans and Democrats have so far voiced support for the legislation. If lawmakers do nothing as the trade war escalates, destroying thousands of American jobs in the process, it would be “Congress’ most consequential dereliction of duty so far.”