President Trump announced on Thursday that he’s going to impose tariffs on imports of steel (25%) and aluminum (10%). He has long called for these tariffs, saying America is being cheated by foreign competitors and its large trade deficits. Trump’s announcement jolted markets, upset allies and led to rebukes from The Wall Street Journal and some congressional Republicans.
Winners: Domestic steel and aluminum manufacturers avoid getting undercut on prices from abroad.
Losers: Companies that rely on steel and aluminum for production and services will face higher costs. Consumer could pay higher prices. Conservatives and free-traders are losing in their long-term effort to minimize tariffs and other import duties.
What’s next: An escalating trade war?
Business: The sectors with the most to lose: construction, auto and energy. Here are the companies in position to take a big hit.
How the stock market reacted: Trump gets mixed responses from corporations
Wall Street Journal: “Donald Trump made the biggest policy blunder of his Presidency”
Conservative lawmakers grumble
Rust Belt Democrats praise
Jonathan Swan: Trump effectively promised a trade war on the campaign. Republicans can express their horror but not their surprise. From Mike Allen and Swan: Trump has grown to especially hate Kelly’s rigid rules, so he purposely blew off Chief of Staff John Kelly’s process and announced planned tariffs in a haphazard way. Staff can try to impose their views on Trump. But when it comes to trade — the one thing he’s believed consistently for 30 years — they will inevitably fail.
Staff to flee? Trump just completely circumvented the interagency process and is executing a policy chief economic advisor Gary Cohn and other free traders think is calamitous.
A 24% steel tariff was recommended to Trump, but he increased to 25% because it’s a nice round number. Trade is one of Trump’s oldest consistent policy issues. In an Oval Office meeting last year, he told advisers: “I want tariffs. Bring me some tariffs!”
International fallout: The EU threatens to strike back, The Telegraph reports. China will respond if tariffs cost upwards of $10 billion, CNBC reports. Canada fumes: “unacceptable”