The overtly protectionist aim of Donald Trump’s “liberation day” tariffs was to drive jobs, industry and wealth back to America in line with his MAGA vision.
The immediate outcome was panic. The markets lost trillions in value. All while Trump revelled in the notoriety of having caused mayhem worldwide.
In the week that followed he said variously “my policies will never change;” “sometimes you have to take medicine to fix something;” “I know what I’m doing.”
Continuing to stand firm last Wednesday amid mounting anger even from his own MAGA base that all this was hurting American consumers, he added: “BE COOL. Everything is going to work out well.”
First the bond markets – then the tech bros
A few hours later, after the bond markets started to backfire, he announced a 90-day pause on the most punitive of tariffs apart from the 125% on all imported Chinese goods. U-turn number one.
Various tech bros then took the opportunity to spell out the reality of maintaining the China levies: the price of iPhones (80% of which are made in China) would double for everyday Americans.
Late Friday US authorities exempted smartphones and other tech gadgetry from China’s 125% levy. U-turn number two.
Over the weekend Trump, saving face as expected, doubled down, hiking up the levy to 145% on all Chinese imports save computers and smart phones. Meanwhile China moved from 84% to 125% on US imports, all while Beijing officials implored Washington to call time on the trade war.
One positive: Trump can be persuaded to change tack
One important thing to note amid all this chaos: Trump isn’t afraid of pulling a U-turn when he understands his political interests are affected.
Americans like their gadgets. Tech bosses spelt that out. And just like that, no tariffs. U-turn. Gone. Done. Ancient history.
Can Starmer follow tech bros lead?
Sir Andy Street, former WM mayor, says PM Keir Starmer must follow the tech bros’ lead in negotiating away the punitive 25% levy on UK car imports to the US, which threatens to do untold damage to this region’s automotive sector, 20% of whose vehicles until now have gone to America.
Starmer, like the tech bros did, must spell it out: “Americans like their Land Rovers. They’re angry at having to pay way over the odds. Now, how’s about we bin that nasty little tariff … oh, and let’s Make U-turns Great Again.”
“This can be done,” says Street.
