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- Trump's Metal Tariffs Draw Global Reprisals and Risk Larger Feuds
Trump's Metal Tariffs Draw Global Reprisals and Risk Larger Feuds
He vows to respond to E.U.'s new fees
Matt Davis
March 13, 2025
Hey, friends,
For those of you who are new here, I read the top story in the New York Times every morning so that you don’t have to. If you were forwarded this, you can subscribe here. I’m also doing a five-minute video version of this, each morning at around 9 a.m. (depending on how long it takes me to read the newspaper). If you’d like to follow me on LinkedIn (you can always watch the recording later). If you subscribe to my Youtube channel it’ll also send you a notification when I’m “going live.”
Say…what’s that? You love reading this newsletter and want to THROW MONEY AT IT?
Now, let’s do this!
This morning’s front page story by Ana Swanson and Jeanna Smialek focuses on the medium term economic risks of President Donald Trump’s tariff policies. The stock market jittered up and down yesterday $SPX ( ▲ 0.11% ) and isn’t anywhere near its February highs, but so far it’s resisted plummeting, say, the 20% that corporate CEOs told the Wall Street Journal yesterday it would have to, for them to “speak out” about the President. They’re such brave chaps. Here’s the graph, snapped by an eagle-eyed WSJ photographer:
And here’s more on that story from the Wall Street Journal:
“Business leaders’ economic outlook has dimmed since the president imposed some tariffs in early February while delaying others. In a survey of more than 300 executives conducted last month, 47% said they were optimistic about the U.S. economy, a 20-point drop from the 67% who voiced optimism in the fourth quarter of 2024, according to the Association of International Certified Professional Accountants, which conducts the quarterly survey.”
What’s more, they think Trump’s tariffs are a bad idea, and are prepared to say so in private:
How business leaders talk about the Trump administration in private has been markedly different than what they are game to say in public. The dissonance was on full display here this week.
Early on Tuesday, dozens of corporate executives and others assembled at a Yale CEO Caucus not far from the White House just as news emerged that the Trump administration planned to potentially double tariffs on steel and aluminum from Canada. Those in the room responded with a mix of groans and shocked laughter.
“There was universal revulsion against the Trump economic policies,” said Jeffrey Sonnenfeld, a professor at the Yale School of Management, who organized the invite-only summit that included corporate bosses such as JPMorgan Chase’s Jamie Dimon, billionaire Michael Dell and Pfizer’s Albert Bourla. “They’re also especially horrified about Canada.”
They just won’t say any of this to his face. It seems we’re actually reading the Wall Street Journal this morning, and not the New York Times, but since I deduct the subscription to both from my taxes, I figure we may as well all benefit, eh?
Now: The crux of the Times story is that tariffs are tit-for-tat. The E.U. responded yesterday to Trump’s steel and aluminum tariffs by putting tariffs on bourbon, boats, and motorbikes (which one of my editors, Sydney, suggested yesterday would be the “best name for a lesbian punk band”). What’s wrong with tit-for-tat (perhaps another good name for a lesbian punk band)? Well…
Those conflicts could spiral into even bigger trade wars. Asked on Wednesday if he would retaliate against the E.U. tariffs, Mr. Trump said, “Of course I will respond.”
Oh dear. I think it’s time for my favorite Ray Winstone “Scum” Economic Policy image again:
He’s got a billiard ball in that sock. But what’s he going to do with it?
The Times interviewed a variety of stock market analysts because they don’t tend to run summits for corporate CEOs quite the way the WSJ does. There’s an an old joke in the newspaper world holds that The Wall Street Journal is read by the people who run the country, The New York Times by those who think they run the country, The Washington Post by those who think they ought to run the country and The Boston Globe by people whose parents used to run the country.
Stock market analysts think Trump’s new Ray Winstone Economic Policy (let’s call it “RWEP”?) could, er, mess up economic growth.
On Monday, Goldman Sachs slashed its 2025 economic growth forecasts for the United States to 1.7 percent from 2.4 percent, citing adverse trade policy.
“This may be the calm C.P.I. report before the storm,” said Seema Shah, chief global strategist at Principal Asset Management, referring to the inflation data. She said that, with tariff policies, the inflation picture could potentially get “uglier as the months go on.”
The Times also has a handy “tracker” tool to follow Trump’s first 100 days. It makes for amusing reading if you like the hokey-pokey.
That’s what it’s all about!
This does all play out against a worsening picture for U.S. metal production.
U.S. Steel, one of the country’s sole surviving makers of primary steel, has warned that it will need to shut down plants and lay off workers unless it finds a more deep-pocketed acquirer. The chief executive of Cleveland Cliffs, the country’s other primary steel maker, said that last year had been “the worst year for domestic steel demand” in over a decade.
And the Trump administration has been firmer on the new metal tariffs than on others, describing them as “fundamental for our national security.” But do they really care about our national security?
I ask because other things that are fundamental for our national security include a functional tax system, preventing the spread of diseases around the world, preserving health care benefits for the old and disabled, preventing the resurgence of Nazism in Germany, and, of course, bringing peace to war-torn Ukraine. But for those of us who’ve been reading the newspaper since I started writing this newsletter 37 days ago, it comes as no surprise to hear that America has not been prioritizing those things of late.
My sense is that the Trump administration wants an easy talking point to trot out for people in Pennsylvania who might otherwise vote Democratic if only the Democratic Party could come up with a coherent platform to do anything and overcome its internal chaos. Still the stock market is down 8.7% in the last month, and that’s what voters in swing states really care about. Perhaps we could try some policies that make it go up?
Thanks for reading the newspaper with me so that you don’t have to! And please share this newsletter with anyone who you think might appreciate it.
Matt Davis lives in Manhattan with his wife and child.