Washington Crossed a Line on Tariffs
President Trump’s decision to use “national security” as an excuse to levy harsh tariffs on steel and aluminium imports from allies such as Canada, Mexico, Japan, and the European Union confuses, distresses and saddens them ... for no gain to the United States. They have no choice but to respond as World Trade Organization rules allow; if not, they would be complicit in Mr. Trump’s abuse of the flexibility the WTO allows for real national security concerns.
The United States, as a global power with obligations that go well beyond what other countries have, needs this flexibility and has consistently argued strenuously for it, arguing that we would never abuse it to promote only economic and commercial interests.
Washington has now crossed that line. This throws open the door for others to do the same, blowing a hole in decades of efforts by the U.S. government, the European Union, and others to convince others to open their markets, righting the imbalances Mr. Trump says he’s concerned about.
So, the Europeans and others now sadly must respond, exacerbating what could literally become a trade war. A war between allies who share far more serious concerns about economic and trade policies adopted by Beijing, as the U.S., EU, and Japan’s trade ministers agreed in Paris yesterday.
We can only hope that America’s allies will continue to work with Washington on these issues in the months to come. Faced with actions like the steel tariffs (and threats to do the same on autos), they could be forgiven for not being so magnanimous.
Further Reading: Finding a Way Out of the Steel Cul de Sac
The views expressed in GMF publications and commentary are the views of the author alone.