These days, there are lots of newspaper headlines about the “Trump tariffs.” At this point, no one knows whether Trump’s tariff strategy–whatever it is–will ultimately succeed. If it does, reporters will stop talking about the “Trump tariffs,” just as “Reaganomics” disappeared from headlines once Reagan’s economic policies had proved spectacularly successful.
It is useful to see what people in other countries are saying about the administration’s tariff policies. Thus, this Telegraph article: “EU backs down from trade retaliation as Trump threatens 30pc tariffs.”
Brussels has backed down at the eleventh hour from plans to impose €21bn (£18bn) retaliatory tariffs on the US after Donald Trump threatened to punish the bloc with 30pc levies.
The EU’s tariffs on US steel and aluminum exports were due to come into effect after midnight on July 14, but Ursula von der Leyen, the European Commission president, said these will now be put on hold until early August.
The reprieve will give negotiators in Brussels more time as they battle to secure a trade agreement with the US.
Everyone wants access to the world’s biggest market, and every country I know of imposes tariffs of its own, as well as other barriers to free trade. The U.K., happily, has already struck a trade deal with the administration:
The import tariffs threatened by the US president on Saturday night are three times higher than those imposed on Britain.
Whew.
Trump has of course been posturing on tariffs, but so has everyone else:
Ms Von der Leyen said: “We have always been very clear that we prefer a negotiated solution. This remains the case, and we will use the time that we have now.”
Her comments represent a marked shift in tone from the EU, which has been attempting to play hardball with the US president.
The EU wants to make a deal:
Ms Von der Leyen said the bloc would not implement its list of counter-tariffs and instead stated “the time is for negotiations”.
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Germany has used its influence within the bloc to ensure the EU strikes a favourable deal with the US which protects its export-driven economy and crucial automotive industry.French wine and cheese producers have expressed concerns that the they will be heavily affected by 30pc tariffs.
“It’s a new environment we will have to get used to – I don’t think this is temporary,” Francois Xavier Huard, head of the dairy association FNIL, told Reuters.
Cracks are appearing among EU nations:
Matteo Salvini, Italy’s deputy prime minister, hit out at the EU’s negotiation strategy.
“Trump has no reason to attack our country but once again we are paying the price for a German-led Europe,” he said.
When it comes to free trade, no country has been pure. It isn’t only tariffs; quotas, bogus environmental standards (e.g., the EU’s anti-GMO stance) and other barriers can be equally or more important. I think Trump is fundamentally correct in arguing that the U.S. has been disfavored with regard to trade in the post-war era, and that we will see adjustments that are favorable to the U.S. without being unfair to other nations.
That is my hope, anyway. The wheel is still in spin, but you will know Trump’s policies have been successful when newspapers no longer talk about the “Trump tariffs.”
