Trump Started a Global Trade War Today: Canada, Mexico Responded, So Will Europe
Mike Mish Shedlock
The U.S. will impose tariffs on steel and aluminum imports from Canada, Mexico and the European Union starting on Friday. Trump's ill-advised Tariffs Provoked Anger and Retaliation from US Allies.
The tariffs make good on President Donald Trump’s threats and show the administration is maximizing pressure to win concessions from allies, while simultaneously negotiating through a high-stakes trade conflict with China, seen as an economic competitor.
Besides steel and aluminum, the U.S. administration is studying whether tariffs should be imposed on imported cars and auto parts under the same law that gives Mr. Trump wide authority to erect trade barriers under the banner of national security.
“This is dumb,” said Sen. Ben Sasse, a Nebraska Republican. “Europe, Canada, and Mexico are not China, and you don’t treat allies the same way you treat opponents.”
Sen. Orrin Hatch, chairman of the Senate Finance Committee, said in a statement: “Tariffs on steel and aluminum imports are a tax hike on Americans and will have damaging consequences for consumers, manufacturers and workers. I will continue to push the administration to change course.”
Trump Wants to Halt German Luxury Car Imports
Via translation from WirtschaftsWoche, Trump wants to block Daimler from the US market.
US President Donald Trump has announced to French President Emmanuel Macron to exclude German premium car makers from the US market. On Macron's visit to Washington in April, Trump said he would maintain his trade policy until no Mercedes models rolled on Fifth Avenue in New York. This reports the WirtschaftsWoche, citing several diplomats from Europe and the United States.
Trump's grudge against the German automaker - and especially against Mercedes models in New York - is not new. In January 2017, prior to his inauguration, he said in an interview, "When you walk down Fifth Avenue, everyone has a Mercedes-Benz in front of their house." But that's not reciprocity. "How many Chevrolets do you see in Germany? Not too many, maybe none at all, you do not see anything over there, it's a one-way street, "said the real estate billionaire.
What Trump forgets: Popular SUV models such as the BMW X5 or Mercedes GLE are built in the US, not Germany.
- Mexico’s Economy Ministry quickly said it would target several U.S. goods in response, including some steel and pipe products, lamps, berries, grapes, apples, cold cuts, pork chops and various cheese products “up to an amount comparable to the level of damage” linked to the U.S. tariffs.
- Canada, in anticipation of the tariffs, had pledged to impose retaliatory measures. Prime Minister Justin Trudeau Thursday called the levies “totally unacceptable,” adding it was “inconceivable” that they were related to national security.
- The EU has said it is also planning to hit back with its own levies after preparing a list of U.S. exports worth €6.4 billion ($7.5 billion) that could be slapped with levies, up to €2.8 billion of which could go into effect staring June 20. The EU said it would also launch a case against U.S. measures at the World Trade Organization on Friday.
Justin Trudeau Calls Trump's Action "Totally Unacceptable"
Justin Trudeau Tweets
French president Emmanuel Macron and Trump have become buddies.
Why not? France exports few cars to the US.
A translation from Spiegel Online underscores the key idea: Trump's Policies Hit Nearly 5,000 German Companies.
Trump's Real Target
Purposeful or not Trump is driving a wedge between various countries in Europe.
So, I ask again, What's Trump's Real Trade Target: China or Europe?
Amazingly Prophetic Interview
In case you missed it, please consider Trump's Amazingly Prophetic 1990 Playboy Interview.
Regardless, of Trump's primary target, if any, Trump wanted a global trade war. And he just started one.
Only fools cheer.
Mike "Mish" Shedlock