DEBATE: Is there any justification for Trump’s decision to impose tariffs on steel imports?
Is there any justification for Donald Trump’s decision to impose tariffs on steel imports?
David Vance, a political commentator, says YES.
The decision by President Trump to impose a 25 per cent tariff on imported steel is both reasonable and timely.
The US steel industry has been decimated over several decades, not least from 2001 when cheap steel from outside the US poured in, wrecking a formidable industry that once employed 650,000 but as of 2015 had a mere 142,000 working within it.
Recently, the EU slapped a 73 per cent tariff on cheap steel from China entering its market, so this 25 per cent tariff seems modest by comparison.
Trump’s policy has the strategic aim of placing US manufacturing needs foremost, and tariffs are but one weapon he can deploy against the under-cutting Chinese. The President seeks to eliminate the huge US trade deficit, turbo-charge GDP growth, and create millions of new jobs.
This will result in a more prosperous America, and as a previous US President observed, when it comes to re-election, “it’s the economy, stupid”.
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Dr Rebecca Harding, independent economist and co-author of The Weaponization of Trade, says NO.
The US administration has signalled a profound strategic shift in its position on trade. By using national security as a justification for imposing import tariffs on steel, it is unilaterally undermining the power of the WTO and risks sparking a global trade war.
The EU and China have already stated that they are considering retaliation. Any counter-measures elsewhere in the world will put pressure on US exporters; the US imports more than double the amount of steel it exports in value terms, pushing up prices and pressurising domestic producers to fill the gap.
The move also represents confirmation that the US has overtly weaponised trade. The national security loophole in post-war trade agreements was intended for use in the event of war or a serious national security threat. Other countries could now use the same loophole. This is a dangerous escalation of Cold War rhetoric and gives a whole new meaning to the concept of trade war.
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