Latest US Trade Casualties: Nails, Whiskey, Cranberries, Lobster, and Autos Too.

In Trump's global trade war, the latest US casualties are whiskey, cranberry, nail, and lobster industries. Autos too.

As Trump threatens tariffs on all auto imports from Europe, the EU Says It Will Respond.

“If they decide to raise their import tariffs, we’ll have no choice, again, but to react,” EU Commission Vice President Jyrki Katainen told French newspaper Le Monde.

“We don’t want to fight (over trade) in public via Twitter. We should end the escalation,” he said in the comments published on Saturday.

How to End the Escalation

No one has figured out the obvious. The way to end the escalation is to stop responding!

Meanwhile, Trump has not figured out that Tariffs on European Cars Would Hurt US Auto Jobs.

German automakers Mercedes, BMW, and Volkswagen all have plants in southern states and directly employ more than 20,000 US workers between them, primarily at those factories. Volvo is just starting production at its first US plant in South Carolina.

BMW's largest plant in the world, in South Carolina, built 371,000 cars last year. It exported more than 70% of those cars to other countries. By contrast, BMW only imported 202,000 cars to the US from its German plants.

Build Them Here

And lower sales will cost jobs at car dealerships, which employ more people than the automakers' assembly plants. Let's look beyond autos.

Please consider Lobsters, Small-Batch Whiskey and Trump’s Trade War.

Nails

Mid Continent, the largest American producer of nails, imports steel from Mexico to make its nails. That steel is now subject to the 25 percent tariffs that Mr. Trump imposed on dozens of countries, forcing Mid Continent to raise its prices by nearly 20 percent.

Orders have plummeted by 50 percent this month as the company tries to compete with cheaper foreign-made nails. Those foreign manufacturers are not facing higher steel costs, giving them an advantage over Mid Continent.

The company, which employs about 500 workers, has already cut 60 jobs. It could potentially cut 200 more in the coming weeks.

Whiskey

To meet a global thirst for American whiskey in recent years, distilleries that make bourbon and rye — and sell it around the world — have sprung up across the country. But this week the European Union applied a 25 percent duty to American whiskey in response to Mr. Trump’s steel tariffs, spiking the prices of the iconic American tipple on the Continent.

For small distillers like Scott Harris, a founder of Catoctin Creek Distillery in Purcellville, Va., this has dampened happy hour.

“We are just launching into the European market now in a big way, and this could be the worst possible timing for us,” Mr. Harris said. “We’re probably going to see all of our European sales now come to a screeching halt.”

Comments (20)
No. 1-20
Stuki
Stuki

But hey, lobbyists get to collect hefty fees to lobby for exemptions. In progressivestan, being connected Trump being competent and competitive, after all.....

Kinuachdrach
Kinuachdrach

Mish -- your site is in danger of becoming dull. You are entitled to your own faith in unilateral free trade, but it is not accurate to keep talking about "Trump's trade war". All the President is doing is recognizing that the US has been on the losing end of a full-out trade war for decades. He did not start the fire!

The US used to send out over-paid bureaucrats who would "negotiate" by giving in. Very peaceful, and the trade "partners" loved it. Classic example -- NAFTA, North American FREE TRADE Agreement, which is hundreds of pages long. How can it take hundreds of pages to say "free trade". It is not "free trade" it is managed trade -- and managed to the disadvantage of US workers. Of course, elites do not give a damn for the impact of unfair trade on the working man. Strange that a New York billionaire has more concern for the working man than the media and the Democrat Party combined.

Blacklisted
Blacklisted

How were we doing before the "Trump trade war"? We should all know that career politicians and their establishment remora in the media and boardrooms of big corporations are responsible for our pathetic economy, which has been getting progressively worse for decades, and is the source of the civil unrest, increasing taxes, and trade wars. If Trump were to fail at everything he attempts, his presidency would be a raging success for one simple reason, he has not only gotten the establishment to pop their heads out of the swamp.

Blacklisted
Blacklisted

but they are committing political suicide.

Kimo
Kimo

Trump defines his free trade, carrot and stick, strategy when he announced his candidacy, three years ago:

Ross explains the implementation:

Patience, Grasshopper, the Canadian ship is starting to turn:

Carlos_
Carlos_

"Of course, elites do not give a damn for the impact of unfair trade on the working man" When I see a sentence such as the one above I know I'm talking to a brain washed person (ditto for "MAGA"). Do tell please what is your definition of "elites" (who is in that group). What is your definition of "working man"? Is a working man only the one who uses his hands to work? Is it the working man under your definition a software engineer (o is he/she an elite?). As for MAGA when was America Great so that we can come back to that golden age -be specific please with dates. Another thing (besides the math that obligates trade deficits) weren't Americans the ones buying all these Chinese products willingly or did china put a gun to their heads?. You all Trump supporters make me laugh. This Trump war has a single goal in mind: To shore up his base so that he doesn't lose the house.

Kinuachdrach
Kinuachdrach

Carlos_ -- With all due respect, it is time to engage brain.

You know who the elites are -- the Political Class, their hangers-on in the bureaucracies, academia, media, the FBI, the IRS, business leaders who depend on government handouts or market interference. They are approximately what the Communists used to call the Nomenclatura.

You know who the working men are -- guys who work for a living and are net tax-payers. The makers, not the takers. Yes, a software engineer is a working man … unless he is on an H1-B visa, in which case he is an indentured servant of the elites (see above). But you knew all of that already.

And please, be realistic! What have the Congressional "Republicans" done to help move President Trump's agenda forward? Why would the President care about any Congressional "Republican" whose only loyalty is to the Swamp of the status quo?

Realist
Realist

Trump plays the politics of hate. He gets his supporters to believe that there is some “enemy”; China, Korea, Japan, Europe, Canada, Mexico, immigrants, Democrats, Republicans, previous administrations, scientists, etc. The entire trade war is a bad joke. He gets his dim witted supporters to believe that the US is being harmed by tariffs in other countries. Meanwhile, the US has higher tariffs than every other developed country. He says he wants to bring back jobs, yet the US has record low unemployment and more jobs sitting empty than unemployed people. The only people still unemployed are those without skills. But Trump will keep up the pretense as long as he can keep duping his supporters into voting for him.

Six000mileyear
Six000mileyear

Certainly the price of some things will go up due to tariffs place on them by the US. The flip side is retaliatory tariffs will decrease demand for certain US goods. Less demand will means lower prices. I'd really like a 2 for 1 lobster roll deal this summer.

RonJ
RonJ

"Trump plays the politics of hate."

Realist, the Democratic Party plays the politics of hate.

RonJ
RonJ

"And lower sales will cost jobs at car dealerships, which employ more people than the automakers' assembly plants."

The implosion of subprime auto loans is going to cost jobs at car dealerships in the next recession. Danielle DiMartino Booth said that subprime auto would feature prominently in the next recession, as subprime home loans had in the previous.

With 230+ trillion dollars in global debt, the next recession is going to put quite a dent in global trade, with or without a trade war.

Carl_R
Carl_R

Both parties play the politics of hate. The reason is that, for both parties, being in power is more important than what they actually accomplish.

A side question: if they actually impose these tariffs, they will raise some revenue. That revenue will decrease the projected deficit, and thus, could enable additional tax cuts.

Quagmire
Quagmire

I fail to see how lower priced nails, whiskey, and lobster are a bad thing for me.

Cranberries I can do without.

Realist
Realist

Ron j. I am not Republican, Democrat, nor American. Trump definitely plays the politics of hate. You would have to be blind, deaf and dumb not to see it.

themonosynaptic
themonosynaptic

We've seen this movie before. In the 1980s Japan was the boogie man. MITI was centrally coordinating Japanese manufacturing and the Japanese were playing games to restrict imports into their country.

The inevitable happened - when the World changed the Japanese bureaucrats didn't see it and the more nimble capitalism of the U.S. bounced back.

The same will happen with China. No human or human agency understands the World's economy or the trends that will impact it over the next decade, and any attempt is reminiscent of King Canute. The Chinese seem determined to learn this lesson the hard way.

We can sustain decades of net imports because the dollar is the World's reserve currency and is not subject to the same forces that other currencies are - thus we print pieces of paper in return for an outsized share of the World's output.

This is a pointless trade war, with no viable end state that allows us to declare victory, and is simply going to hurt people until it stops.

Advanced education and relatively free markets gave America its lead over the rest of the World, coupled with a large internal market, and the only undamaged economy in 1945. We squander these advantages at our peril.

Stuki
Stuki

The Soviets tried the "run by 'workers'" trick already. Didn't work.

While the Anglo countries have been plugging away at the "run by elites." Which, as is becoming increasingly obvious, didn't work all that well either.

And Japan, along with some continental European countries, have been trying "run by technocrats." Nope. Didn't work either.....

All conveniently forgetting that America, from Jefferson and to about a century and a few decades later, worked like gangbusters. For as long as most of the country were effectively "ran by" nobody. From wilderness to wonderland in less time than it later took a Federal Reserve and the other progressive institutions of oppression to render America's urban working and middle classes homeless, childless and suitably indentured, by debt and "Rule of Law."

You'd kind of hope someone would have the brains to take a hint.... But perhaps the whole publicly funded "education" rackets employed by Soviets, Anglos and technocrats alike, is one thing that is working as intended for them, after all....

Stuki
Stuki

Oh, no! How could I be so uninformed!

Robber Barrons were what Jedediah Smith woke up fearing every morning! Scary buggers too, they were no doubt, roaming around the Rockies "running" the country!

Thank you so much for demonstrating how much more attention you obviously paid to what you were told to mindlessly regurgitate by government "educators" than poor me ever did!