Trump is winning his trade war, but will pay the price Americans

AUSTIN Judging from the air of concession wafting across world capitals from Tokyo to Brussels, US President Donald Trump is prevailing in his trade war.

- Bhagyashree Garekar

The White House is in a celebratory mood. Almost every day, press conferences and statements catalogue the many supposed benefits flowing from Mr Trump's strategy.

The strategy has brought trade partners to the negotiating table, is catalysing trillions in foreign investment commitments, protecting America's strategic industries and generating billions in revenue. So much winning, in Trump-speak.

If success, however, means more jobs, more trade and a stronger economy, the evidence is more suspect. All indications are that Americans will pay more for nearly all the goods they consume when the effects of all the tariffs kick in.

The universal baseline tariffs of 10 per cent have already been in effect since April and will remain in place for around 100 nations with no trade deficits with the US, like Singapore and Australia.

Effective from Aug 7, more than 70 nations will face "reciprocal" tariffs, ranging from 10 percent to 50 percent.

The concept of reciprocity seems questionable, as Mr. Trump's strategy from the start has been to exert pressure on trade partners rather than strictly mirror their tariffs.

For those nations running a trade surplus with the U.S., the rate is at least 15 percent. It is higher still for others, where geopolitics and personal vendettas sharpen the blade.

Brazil, for instance, has no trade surplus with the U.S. Nevertheless, it has been slapped with a rate of 50 percent, at least partly because Mr. Trump has an issue with the government prosecuting former president and Trump ally Jair Bolsonaro on coup charges.

India, at a 25 percent rate, also faces an unspecified penalty for its import of Russian energy and arms.

The U.S. has also caught on to trans-shipping, the sly re-routing of goods through lower-tariff nations. This practice now invites a 40 percent penalty.