Trade

Donald Trump was revved up for his Freedom 250 Grand Prix auto race, which took place in downtown Washington yesterday. But even as the American President enjoyed the festivities, the mood elsewhere was distinctly less buoyant. With Democrats pounding away at voter concerns about affordability, Republican legislators are fretting that Trump might crash the party’s political fortunes with his costly tariff policies. If the President wanted to promote an economic program that was designed to bolster the political prospects of the Democrats in the impending November midterm elections, he could hardly do better than his institution of new duties of 50 percent against Canadian goods.

Who really thought Donald Trump’s America was about to join the stampede of first-world powers promising to recognize Palestine at the United Nations?  "Wow!" He exclaimed this morning on Truth Social. "Canada has just announced that it is backing statehood for Palestine. That will make it very hard for us to make a Trade Deal with them."  All over the world, commentators convinced themselves that Trump’s expression of concern on Monday about "real starvation" in Gaza meant he was pivoting with global opinion and against Israel.  It turns out, however, that Team Trump is not for turning when it comes to the Middle East. Marco Rubio, the US Secretary of State, has accused the countries now embracing Palestinian statehood of falling for "Hamas propaganda".

They say three times makes a pattern. So what should we make of the President’s trade agreements, three of which he confirmed this week, as the August 1 deadline for "reciprocal tariffs” looms?  If there remained any confusion about his agenda, he helpfully laid it out in all caps. “I WILL ONLY LOWER TARIFFS IF A COUNTRY AGREES TO OPEN ITS MARKET. IF NOT, MUCH HIGHER TARIFFS!” he wrote on Truth Social. “USA BUSINESSES WILL BOOM!” Given the size of the lettering, and the similarities to the deals secured with Indonesia, the Philippines and Japan this week, we should take Donald Trump at his word on this one. Put simply: so long as other countries cut taxes for their businesses, he will hike taxes on American businesses ever so slightly less.

The reaction of markets to the US trade deal with Japan shows yet again that if you presage bad news with even worse news you can make people pathetically grateful at the outcome. Shares in Toyota surged by 14 percent at the news. Yet why, when the deal will see imports of Japanese cars to the US slapped with tariffs of 15 percent? Because back on "Liberation Day" in April,  Donald Trump announced that Japanese imports would be subject to 24 percent tariffs. Reactions to Trump’s reset in trade relations with the rest of the world have undergone wild swings in recent months. First, markets plunged.

Is life worse today than it was 50 years ago? According to a Pew Research survey, 58 percent of respondents believe it is. Perhaps watching the doom and gloom of the nightly news gives the impression that times have never been worse. But the facts show otherwise.The world has never been richer, food has never been more abundant, and extreme poverty is at historic lows. We are fortunate to live in a country where the people have a strong work ethic and control a vast, resource-rich territory. Yet, even with those advantages, we rely on trade to access goods that America simply does not produce in abundance, like coffee and bananas. Perhaps we should ask a more nuanced question: is international trade good or bad?

As a longtime critic of the Clinton administration’s “free trade” agreements, I’ve lately been mocked by liberal friends who suspect I’m sympathetic to the “plan” hatched by Donald Trump and his senior advisor on trade, Peter Navarro, to “ruin” the country with indiscriminate import tariffs. This sort of jokey ridicule goes with the territory when you jab at neoliberalism from the left. Bill Clinton still has legions of fans among the Democratic party establishment and its media acolytes, and it’s hard for them to face up to the fact that the former president’s economic policies have led directly to Trump’s election as president not just once, but twice.

President Donald Trump has set Saturday as the deadline to impose 25 percent tariffs on Canadian and Mexican imports. From the Oval Office earlier this week, Trump explained that the move aims to push the US’s neighbors to take swift action to curtail illegal immigration and fentanyl, as well as to address growing trade deficits. The tariffs may or may not include oil, with Trump saying Thursday that determinations were still being made. Following Trump’s tariff feud with Colombian president Gustavo Petro Sunday, with the Trump forcing his Colombian counterpart to welcome deportees, his latest move signifies an expansion of his revamped “FAFO” foreign policy.