Trump’s trade war

Stuff reports:

US president Donald Trump’s administration appears unbowed by broad domestic and international criticism of his planned import tariffs on steel and aluminium.

White House trade advisor Peter Navarro said on Sunday that the president is not planning on exempting any countries from the stiff duties.

Speaking on CNN’s State of the Union, Navarro said: “At this point in time there’s no country exclusions.”

This is bad bad policy. It’s what you would expect from a hard left socialist Government.

The benefits of free trade are well established. Hundreds of millions have been lifted out of poverty thanks to trade.

Protectionism harms both the country imposing it, and other countries impacted by it. The country imposing tariffs causes its consumers to pay higher prices for goods they want. It also diverts investment into more inefficient industries, rather than having investment go into areas they have a competitive advantage.

It of course also hurts exporters in other countries. It is a lose lose.

It is highly likely the act by Trump breaches WTO rules the US has signed up to. So it weakens international law. It may also leasd to other countries imposing protectionist tariffs in response which could cause a global economic downturn.