14 Apr Trade War?: “Reciprocal Tariffs,” the Sovereign Right of the United States
By,
Leonardo Morales, Senior Fellow, MSI²
The European Union, China, and Canada announced retaliation for the 25% tariffs on steel and aluminum imposed by the White House in pursuit of fair trade. President Donald Trump said he will respond with equal force.
Ever since US President Donald J. Trump began emphasizing tariffs during his election campaign, he knew full well that it would unleash a “storm of reactions” at home and abroad.
Everyone will always oppose losing their advantages, especially when they have been in place for decades and an economic system built on that foundation.
“They have abused us for too long, they will not abuse us anymore,” the Republican leader said firmly.
“The United States will not tolerate further abuses in trade,” he emphasized.
“And of course we will respond” to the tariffs that continue to be imposed on us from anywhere in the world, he declared.
At the end of the road, it is very likely that Trump will once again be proven a successful strategist, hence his affinity with another indomitable innovator: Elon Musk. Neither understands walls or obstacles when it comes to embarking on a new path; much less do they fear the risk of defeat; on the contrary, they see them as the best way to achieve success.
The Strength to Negotiate
And on this path of tariffs, the president already had a major victory in 2020 against his greatest competitor: China. He also imposed them on other nations, but to a lesser extent.
After a year and a half of trade battle, he sat the Asian regime down to sign; and in January 2020, the US and China sealed a historic trade pact on tariffs that remains in effect.
To that important agreement, the US president now adds a 20% tariff on many products and materials imported from the world’s now second-largest economy.
And although many oppose it, one of the great virtues of a great negotiator is patience, generating supposed “chaos,” and resilience. Trump applies these qualities excellently. That’s why he’s not distracted by criticism or by how many adjustments he needs to finally achieve his goal.
Trump is currently putting into practice, like never before, his skills as a businessman and negotiator par excellence, but also as a political negotiator, because he’s not the same old inexperienced negotiator in that field. Three presidential campaigns and one term during his political career in the world’s leading power have given him more than enough support to defeat or convince any politician, regardless of their country or party affiliation. Above all, he is driven by his most ambitious economic and geopolitical project in modern US history: Make America Great Again.
Zero Tolerance for Disadvantages for the US
The European Union, China, and Canada announced retaliation for the 25% tariffs on steel and aluminum imposed by the White House.
However, all three parties have been imposing tariffs on the US for decades.
Among the extensive list of US products on which the European Union imposes tariffs are vegetables and other agricultural products (69%); 58% on sugar and meat; 49% on dairy products; 35% on cereals; 22% on fruits; 15% on fish; and 13% on wine.
In addition, Europe imposes a 13% tariff on American vehicles and a 6% tariff on American motorcycles.
The US president emphasized to reporters that he “will not budge at all” on his tariff policy, “not on aluminum, not on steel, not on cars.”
Trump singled out France and other EU countries, saying he would impose a 200% tariff on wine, champagne, and other alcoholic beverages if Brussels imposes 50% tariffs on American whiskey.
“If the tariff is not lifted immediately, the United States will very soon impose a 200% tariff on all wines, champagne, and alcoholic products from France and other EU countries,” Trump wrote on his Truth Social network.
Trump promised to “hit back” at the European bloc’s response, and Washington’s trade representative, Jamieson Greer, called the EU “out of touch with reality.”
China will impose a 15% tariff on US imports of chicken, wheat, and corn, and a 10% tariff on soybeans, pork, beef, aquatic products, fruits, and dairy products, the Chinese Ministry of Commerce announced. The Chinese Ministry of Commerce also turned to Canada, imposing tariffs ranging from 25% to 100% on various Canadian imports.
Ingratitude
Cotton is also among the American products subject to a 15% tariff, while vegetables and sorghum are among those taxed at 10%.
The Chinese communist regime, for its part, had more than 200 million people facing starvation and another 500 million in poverty or extreme poverty just six decades ago, under a completely inadequate economy and useless socialist production policies.
Between 1958 and 1962, it is estimated that between 30 and 55 million Chinese died in the worst famine in world history. If we count the number of births and pregnancies lost for the same reason, the figure exceeds 63 million.
Thanks to the enormous business, technological, logistical, and consumer support from the United States for more than 60 years, China is today the world’s second-largest economic power. Despite this, its main objective now is to dethrone North America from its global hegemony. As an American defending the American people, Trump decided to confront all those who have benefited from America’s kindness, those who ungratefully bite the hand that has given and fed them.
He has referred to the European Union (EU), founded in 1951 and consolidated in January 2002 with the introduction of the euro as a single currency, as a bloc created to wipe out North America and sink the dollar. They have failed. On the contrary, today the European bloc is weaker than it was 25 years ago, with serious “social explosions” caused by open immigration and multiple strategic errors. Its future is even more uncertain, as its economic engine (Germany) faces serious problems of economic contraction and energy dependence.
If the US decides to leave NATO, as President Trump has reiterated, the 27 countries would be left completely defenseless and at risk of disappearing if China and Russia join forces in a hypothetical expansionist offensive.
This is the EU’s “great fear” or justification regarding Russia and its invasion of Ukraine, which many analysts consider unfounded. In this apocalyptic scenario, the US would have to act directly. And this is precisely what Europe should be most grateful for when it reflects on its own existence.
Without the US presence as Europe’s protector, it is impossible to determine what would have become of the Old Continent before or during the first 25 years of the 21st century, with a strengthened communist China eager for power and global dominance, similar to the Soviet empire during the Cold War. Or what might happen in the not-too-distant future.
“Diversity united in a ‘monolithic’ bloc tends to disappear,” experts have predicted. The best example is the disintegration of the Union of Soviet Socialist Republics (USSR) and the separation of the United Kingdom from the European Union.
In the 21st century, a globalist dynasty, handpicked from a parliamentary bureaucracy rather than by popular and democratic vote, decides the fate of more than 450 million people in 27 countries.
Today, Ursula von der Leyen rules the bloc of nearly thirty nations like a queen, ignoring distinct cultures, diverse traditions, and those that differ from a real and authentic unity. Her word falls like the sword of Damocles on every EU member, even if they express their opposition. In the end, the majority must obey, calling into question the independence of each member nation.
The history and culture of Spain, for example, has nothing to do with that of Croatia, Finland, or Turkey, or vice versa; to name a few member nations of the bloc. This is the source of all the internal confrontations that have escalated in recent years within this “great alliance.”
The Americans currently contribute more than 60% to the existence and operation of NATO, the army charged with protecting the vast majority of European countries.
Without going into details about Canada, which generates economic losses for the US of more than $200 billion each year, due to the majestic advantages Washington has granted it through trade agreements. The same is true of Mexico.
“We firmly believe that in a world filled with geopolitical and economic uncertainties, it is not in our common interest to burden our economies with tariffs,” von der Leyen said in a statement.
US Against Radical Globalism
“The punitive actions of the European Union, created to destroy the United States, completely disregard the security imperatives of the United States, and even of international security,” declared Washington’s trade representative, Jamieson Greer, blaming the European Union for its failure to jointly address the overproduction of metals and other products.
For its part, the United Kingdom expressed its dissatisfaction with the US measures but announced that it would not retaliate.
The country most “affected” by the US tariffs, according to some analysts, would supposedly be Canada, which supplies half of the world’s aluminum imports and 20% of steel, according to the consulting firm EY-Parthenon.
The new prime minister, also selected without a popular vote through a parliamentary system, clearly understands what the US has put on the table.
Mark Carney indicated that he is willing to speak directly with Trump about bilateral trade relations.
“I’m ready to sit down with President Trump at the appropriate time,” he said at a steel mill in Hamilton, Ontario.
President Trump’s stated objective in the steel sector is to protect the US industry, whose production declines year after year, faced and isolated amid fierce competition, particularly from Asia, and incredibly without US aid.
In the case of aluminum, the United Arab Emirates, South Korea, Bahrain, and China, each accounting for between 3% and 6% of US imports, would also be impacted by the White House’s decision.
Brazil, India, Argentina, and Mexico supply the market to a lesser extent, but “could still experience supply chain disruptions as buyers adjust their sourcing strategies,” experts warn.
Washington has favored and aided dozens of countries for decades.
In the steel sector, Brazil (17% of imports) and Mexico (10%) will be the most affected, after Canada. They are followed by South Korea, Germany, and Japan. The United States imports approximately half of the steel and aluminum used in industries as diverse as automotive, aerospace, petrochemicals, and consumer staples like canned food.
Fewer Imports
And this is the important shift in the international trade order that Trump seeks to benefit the US, ensuring that the country does not have to import such important metals at such low levels.
What does Trump want? Only the minimum import capacity be used and as much production as possible within the US, through a strategy of special incentives for small businesses, investors, and transnational corporations that decide to establish themselves in North America.
Trump’s tariff policy not only pursues [trade justice], but also a wave of investment capital as new sources of income, employment, and production.
Trump imposed tariffs on steel and aluminum during his first term (2017-2021), but unlike that time, he now covers a broader range of metal products, without the exceptions that once benefited Canada, Mexico, and Australia, and without a quota system, as was then granted to Brazil and Argentina, for example.
Furthermore, the measure is cumulative, meaning the new tariffs are added to the existing ones.
After weeks of negotiations, Trump exempted Mexico and Canada from USMCA products until April 2.
That day, what Trump calls “reciprocal tariffs” go into effect, designed to tax a country’s products when they enter the United States at the same rate as those nations tax American goods.
The measure targets emerging nations, such as Brazil and India, which often impose higher tariffs to protect their industries.
The United States is well within its rights to do what other countries do, despite criticism and opposition reactions or anti-Trump or anti-US campaigns.
Sources
The Wall Street Journal
US Department of Commerce
The Western Journal
AFP
Newsweek
Social network X
New York Post