America's War With The World

Tariff weaponisation will wreak havoc on global trade, unlikely to ease Trump's domestic worries

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U.S. President Donald Trump has gone ahead with his plan to impose reciprocal tariffs on America's trading partners. On Wednesday, the US administration imposed a blanket 10% tariff on all countries — this includes Heard and McDonald Islands in Antarctica where only penguins live — along with additional differential rates for different countries. While Trump claimed that the latter had been determined by tariffs charged by each of these countries on US imports, it turns out it is a trade deficit markup rather than tariff that has been used to calculate these rates. It was known that reciprocal tariffs were coming. However, how the administration designed and imposed these tariffs has shocked almost all rational economists.