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article imageEuropean allies warn trade retaliations if U.S. tariffs imposed

By Karen Graham     Feb 24, 2018 in Politics
President Donald Trump has told confidants that he wants to impose the harshest tariffs on steel and aluminum imports recommended by the Commerce Department, but if he does this, the U.S. will face retaliation from its European allies.
Bloomberg News reported on Friday afternoon that three people familiar with the matter said "Trump wants to slap a global tariff of 24 percent on steel imports, the most severe of three options presented to him in a report in January. He is also considering as much as a 10 percent duty on all aluminum entering the U.S., 2.5 percentage points higher than the Commerce Department recommended."
White House deputy press secretary Raj Shah told Bloomberg the president has not made a final decision yet. "As with every decision he makes, the security of the American people and the American economy will be the president’s primary concerns while he considers his potential options."
Trump is considering announcing his tariffs on steel and aluminum ahead of a special election at an event in Pennsylvania, a Rust Belt state he won in the 2016 election.
Global response to possible tariffs
The U.S. Commerce Department recommended on February 16, that President Trump impose steep curbs on steel and aluminum imports from China and other countries ranging from global and country-specific tariffs to broad import quotas.
And while the White House is saying the tariffs are primarily targeting China and Russia, other countries are getting worried. Commerce Secretary Wilbur Ross said the measures are meant to be broad and are designed to prevent targeted nations from circumventing the limits by shipping through a third country.
As it is, many U.S. industries have urged the administration to take care since high import tariffs would raise the cost of supplies for major sectors of the economy. However, National Public Radio is reporting that our European trading partners are also trying to discourage the administration from imposing the tariffs.
Tariffs would start a trade war
President Trump campaigned on a protectionist platform, and he said, "We cannot be without a steel industry. We cannot be without an aluminum industry." And imposing tariffs on imported steel and aluminum was a campaign promise Trump intended to keep.
In July 2017, The Financial Times reported European Union officials were already formulating a list of US goods, including whiskey, orange juice, and dairy products to target for retaliation over Trump’s plans to invoke national security concerns to limit steel imports.
It was also pointed out that steel imports from China have fallen dramatically for a number of years, already, due to sanctions as a result of anti-dumping measures. Rufus Yerxa, president of the National Foreign Trade Council, said "The more likely impact would be on our European allies, Canada and Mexico, Latin America, even other Asian suppliers like Korea. Those are all countries with whom we have very good trade relations and a lot of U.S. exports."
Sen. Pat Toomey, R-Pa., warned of exactly that when he and other lawmakers met with the president last week. "I would just urge us to go very, very cautiously here," Toomey said during a White House session devoted to trade. "Invoking national security, when I think it's really hard to make that case, invites retaliation that would be problematic for us."
"Even though there may be some job winners from an action like this," said Sen. Mike Lee, R-Utah, "you would end up with net job losses in the United States."
Basically, even Republicans are wary of the president's desire to punish China and Russia at the expense of creating a global trade war. There will be no winners, and that is as evident as the nose on your face. But we will know in April what Trump will do.
More about Tariffs, steel and aluminum, european allies, Retaliation, Trade war