[<<n a hastily arranged meeting on Thursday President Donald Trump declared
a trade war against the world. By using an arcane law that allows the
president to impose tariffs for the sake of national security, he announced
across the board tariffs of 25% on steel and 10% on aluminium import.
Although he softened the blow by leaving open the possibility of excluding
some allies if they offered concessions, the announcement opens a dangerous
new road to trade war. With only a small part of its steel production
exported to the US India may not suffer a major loss at this point. But the
move opens the door to a tariff war spreading to other commodities as
countries retaliate.
...
A test of Trump’s continued popularity with the base comes on Tuesday in
Pennsylvania’s rust belt.   In a special congressional election the
Trump-backed candidate faces a rising Democratic challenger. The election
may mean very little for the national scene, but it has come to represent a
referendum on Trump as he had won that district by 20 points.
It is thus no surprise that Trump, facing growing legal challenges and
unpopularity desperately wants a win, to reverse the losing trend. By
hurriedly organising a televised White House meeting with steel workers he
declared a trade war true to his election promise: Win Pennsylvania’s 18th
district for the Trump candidate, world economy be damned. After all
politics, as the saying goes, is local.>>]

https://blogs.timesofindia.indiatimes.com/toi-edit-page/road-to-trade-war-spurred-by-elections-in-a-single-district-trump-tariffs-could-disrupt-the-global-economy/

Road to trade war: Spurred by elections in a single district, Trump tariffs
could disrupt the global economy

March 10, 2018, 2:00 AM IST

Nayan Chanda in TOI Edit Page | Edit Page, India | TOI

In a hastily arranged meeting on Thursday President Donald Trump declared a
trade war against the world. By using an arcane law that allows the
president to impose tariffs for the sake of national security, he announced
across the board tariffs of 25% on steel and 10% on aluminium import.
Although he softened the blow by leaving open the possibility of excluding
some allies if they offered concessions, the announcement opens a dangerous
new road to trade war. With only a small part of its steel production
exported to the US India may not suffer a major loss at this point. But the
move opens the door to a tariff war spreading to other commodities as
countries retaliate.

This reckless action by Trump, condemned by senior members of his own
party, businesses and economists, not to mention China, the European Union,
Japan and other major trade partners, is all the more startling as it is
based on his long-held, deluded views on trade. The tariff war was
initiated in the name of punishing China which had carried on a
mercantilist policy and built a mountain-high trade surplus. But China
accounts for less than 5% of America’s steel and 10% of its aluminium
imports.  Trump’s tariff wall would only hurt the US’s close allies and
neighbours – Canada, Mexico, EU and South Korea.

More importantly, by making steel and aluminium more expensive, the measure
will raise the price of all the products using the metals – from
automobiles and aircraft to beer cans – causing job loss and raising prices
for consumers. In order to save a number of low-skill jobs in steel and
aluminium tariffs would trigger job loss for millions. While there is a
broad consensus in the US on the need to force China to change its
predatory policy, Trump’s steel tariff is a sledgehammer to kill a fly.

The argument against the tariff may be a no-brainer but Trump’s economic
adviser Gary Cohn, a Wall Street veteran, failed to convince the president
and resigned. With the departure of this most influential adviser, who was
instrumental in bringing to fruition Trump’s aggressive tax cuts for the
rich, the president is left with radical populist aides.

Only last month Trump went to Davos accompanied by Cohn, to reassure the
business world that his ‘America First’ policy did not mean America alone.
Now the weathervane president calls Cohn a “globalist” – an insult in the
Trumpian world – and embraces the protectionist policy propounded by the
‘nationalists’.  In reality, the ideological labels mean nothing to Trump.
He would do anything to keep the loyalty of his supporters and win again.

During the election campaign Trump energised his raucous supporters by
promising to make America great again by punishing foreigners who stole
American jobs, American markets and by building a wall to keep out hordes
of immigrants from Mexico and elsewhere. He won the applause of laid off
workers in America’s rust belt, whose votes assured him the presidency.
After a year in office his approval rate has dropped precipitously but
never below 30%, the floor being held by his base supporters who want him
to bring back jobs.

A test of Trump’s continued popularity with the base comes on Tuesday in
Pennsylvania’s rust belt.   In a special congressional election the
Trump-backed candidate faces a rising Democratic challenger. The election
may mean very little for the national scene, but it has come to represent a
referendum on Trump as he had won that district by 20 points.

It is thus no surprise that Trump, facing growing legal challenges and
unpopularity desperately wants a win, to reverse the losing trend. By
hurriedly organising a televised White House meeting with steel workers he
declared a trade war true to his election promise: Win Pennsylvania’s 18th
district for the Trump candidate, world economy be damned. After all
politics, as the saying goes, is local.

-- 
Peace Is Doable

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