President Donald J. Trump made good on his pledge of reciprocal tariffs today in a Rose Garden ceremony billed as “Liberation Day.” He announced the imposition of a bottom-line tariff of 10 percent on all imported goods, but he also presented a chart listing reciprocal tariffs for many nations. Great Britain got off easy at 10 percent, mirroring the aforementioned bottom line, but others weren’t so lucky.
The interesting part of the equation in determining other nations’ tariffs was the factoring in of non-tariff trade barriers such as other countries’ manipulation of their currency. China, for instance, ended up with a 34-percent tariff after Trump and his cabinet calculated their tariff on the U.S. at 67 percent, factoring in that nation’s manipulation of its currency. For the most part, U.S. tariffs were set at about 50 percent of other nations’ tariffs on us.
Tariffs on Mexico and Canada will remain at 25 percent, Trump’s calculation based on their part in failing to halt or impede the importation of fentanyl into the United States. Tariffs on automobiles, steel, aluminum and other products also will remain at 25 percent.
Though Trump celebrated along with his cabinet and supporters, including automotive and steel union representatives, U.S. stock markets were not so sanguine. Overnight trading seemed to indicate that markets, including the Dow, S&P and NASDAQ, are in for some headwinds come Thursday.
“For decades, our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike,” the president said. “American steel workers, auto workers, farmers and skilled craftsmen — we have a lot of them here with us today — they really suffered gravely.”
Critics have denounced the tariffs as inflationary, or worse, depending on their ideology or country of origin. The safest bet is that the markets on Thursday will have a say in what they think of the president’s plan. So far, those markets are signifying at least skepticism, if not outright trepidation.