Donald Trump’s latest trade move, like those before, is hurting his allies more than his rivals.
U.S. partners across the world are crying foul after the president pledged to impose 25 percent tariffs on steel imports and 10 percent on aluminum in the name of protecting national security. Australia’s trade minister called it “disappointing.” Japan reminded the U.S. it wasn’t a threat. Norway said national security is no excuse for protectionism. Canada vowed to strike back.
China — whose U.S. trade surplus dwarfs all others — was muted. That’s because the country sells relatively little steel to the U.S. and Bloomberg Economics estimates the impact might be negligible.
The situation was similar last year when Trump withdrew from the Trans-Pacific Partnership trade deal, which includes Canada and Japan, but not China.
To hurt China, Trump would need to go after a broader bucket of merchandise, such as electronics, textiles and toys. Go there, and a tit-for-tat could become a full-blown trade war.
Trump indicated a willingness to escalate with an early-morning tweet declaring that “trade wars are good and easy to win.” But he’s not on totally solid footing at home. The tariffs further strain ties with a Republican establishment already wary after Trump’s softening tone on gun control and an intense debate raged inside the White House before the trade move was announced.
Dear reader, tomorrow we'll be sending out our new weekend reads newsletter - a Saturday selection of some of our best stories that you might have missed, and a few new ones, too.
Brexit tests | U.K. Prime Minister Theresa May will pledge that leaving the European Union won’t destroy jobs when she delivers a crucial speech today on her vision for relations after Brexit. That’s one of five tests for success the premier’s setting out as she prepares for crunch trade talks with Brussels while trying to hold together warring factions within her governing Conservative party.
Italian elections | Sunday’s election is forecast to produce a hung parliament, threatening weeks of political uncertainty for an economy already burdened by a feeble recovery and a public debt mountain. John Follain looks at four possible scenarios for what might transpire, including a populist pact and a chance of gridlock that may unsettle markets. For our daily round up of news from Italy’s campaign trail, click here.
White House turmoil | Jared Kushner and Ivanka Trump now have few of the allies they’ve relied on to navigate the Washington establishment and West Wing infighting after an exodus of their closest aides, Shannon Pettypiece and Margaret Talev write. The Pentagon, meanwhile, is preparing options for a possible new job for National Security Adviser H.R. McMaster, fueling speculation that his could be the administration’s next departure.
NRA in the Oval | Trump met at the White House yesterday evening with the National Rifle Association’s chief lobbyist, just a day after embracing gun-control measures opposed by the powerful lobbying group. “Good (Great) meeting in the Oval Office tonight with the NRA!,” Trump wrote on Twitter. The meeting suggested that Trump may be shifting position again in the gun-safety debate that has roiled Washington since the Feb. 14 shooting at a Florida high school that killed 17 people.
Venezuela vote | Venezuela has delayed general elections by a month to May 20, after critics condemned President Nicolas Maduro’s earlier announcement of an April presidential vote as a sham to secure another six-year mandate. The demoralized opposition has fractured over the latest terms for the contest, which include an invitation for international observers. Venezuela’s agony looks set to continue.
Bookmark this report on a new round of gasoline scarcity gripping Nigeria, Africa’s most populous nation, at a bad time for President Muhammadu Buhari’s government. And this one on how Xi Jinping’s decision to cast aside China’s presidential term has created doubts that China will play by the book. Click here for the past seven days in Bloomberg photos.
And finally ... There's a new art mystery - who paid $155 million to buy at least 13 Picassos and why? Picasso was dethroned as the world's most expensive artist at auction in November when Leonardo Da Vinci's `Salvator Mundi' sold for $450 million. The Louvre Abu Dhabi says they acquired that painting, but many think the true buyer was Saudi Arabian Crown Prince Mohammed bin Salman. Who's involved now? Art advisors Gurr Johns, which went on the two-day shopping spree, isn't telling.
©2018 Bloomberg L.P.