President Donald Trump’s administration will impose tariffs of 25 percent and 10 percent on steel and aluminum imports from Canada, Mexico, and the European Union on Thursday after previously exempting the countries in March for the sake of trade negotiations.
Foreign trading partners have indicated they will retaliate against the United States for the move, which could quickly escalate into a harmful trade war. (According to the president, “trade wars are good, and easy to win.”) German Chancellor Angela Merkel said the EU will respond to the tariffs “in an intelligent, decisive and joint way.” CNBC reported that Mexico immediately announced tariffs on steel and fruit such as grapes and apples.The Wall Street Journal reports American goods such as jeans, bourbon, and motorcycles could be some of the first products to be slapped with new tariffs.
European leaders were quick to react. “It’s a bad day for world trade. US leaves us no choice but to proceed with a WTO dispute settlement case and the imposition of additional duties on a number of US imports,” said European Commissioner President Jean-Claude Juncker.
Trump’s trade team made use of Section 232 of the Trade Expansion Act to impose the tariffs this spring, claiming that steel and aluminum imports comprised a threat to American national security. “We take the view that without a strong economy, you cannot have strong national security,” Commerce Secretary Wilbur Ross told reporters, according to CNN. (In THE WEEKLY STANDARD, Irwin Stelzer has explained the history behind Section 232 and how Trump might use it.)
Foreign trading partners argue the reasoning does not hold water, and some Republicans in Congress have criticized the move.
GOP lawmakers urged the White House at the time to target China more specifically with the tariffs, rather than imposing them across the board. The White House placated congressional Republicans by offering temporary exemptions to the tariffs for U.S. allies and close trading partners. But with ensuing trade negotiations coming up fruitless, those exemptions will expire Thursday.
And the White House has indicated it will continue to use Section 232 to justify its protectionist trade policies.
Last week, Trump launched the same kind of national security investigation with the purpose of setting 25 percent tariffs on automobile imports, much to the ire of Republicans on Capitol Hill.
“There’s no rational person that could think that we have a national security issue with auto manufacturing,” Senator Bob Corker told reporters at the time. “It’s an abuse of that authority. It’s very blatant.”
