Trump threatens “strategic allies” with auto tariffs


Trump threatens “strategic allies” with auto tariffs

Nick Beams

29 September 2018

While the main focus of the trade war launched by the Trump administration is directed against China—labelled by the US military and intelligence apparatus as a “strategic competitor”—it is stepping up pressure against supposed “strategic allies.”

The key economic weapon it is employing is the threat of tariffs on cars and auto parts of 25 percent under section 262 of the 1962 Trade Expansion Act which empowers the president to impose levies on the grounds of “national security.”

This threat has now been wheeled out on three occasions in the past two months.

The first was when Trump met with the President of the European Commission Jean-Claude Juncker for one-on-one talks in July. According to Trump’s version of events, which he outlined in a press conference with Polish President Andrez Duda earlier this month, the European Union had refused to engage in negotiations but then agreed under the threat of imposts on cars.

The Europeans had previously rejected bilateral talks on the grounds they would not negotiate unless tariffs imposed on steel and aluminium, from which the EU had been denied an exemption, were withdrawn.

But when threatened with the auto tariffs, Juncker “was in my office so quickly from Europe that I did not know they had airplanes that flew that fast,” Trump said. The US and the EU now had the “semblance of a deal” because “it’s—to a large extent—economically all about cars.”

On several occasions, Trump has designated the EU as bad as China on trade, or even worse, only smaller, and his chief trade advisers in the White House are just as hostile to Germany, the EU’s major exporting country and its chief car producer, as they are to…

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