Donald Trump signed two proclamations imposing 25% prices on all imports of steel and aluminum in the United States.
A proclamation is a form of presidential directive for government representatives, but they do not carry the force of law, as would decree.
However, the White House said the prices will take effect from March 4.
“It’s a big problem,” Trump said in the oval office announcing the prices. “The beginning of the wealth of America again.”
He added: “We were struck by the friend and the enemy.”
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“ We were struck by friends and enemies ” said the American president
Proclamations mean that the president has now eliminated the exceptions and exemptions from his 2018 steel prices to allow all the imports of the metal to be taxed at 25%.
The new aluminum price is also much higher than the 10% rights it imposed on the equipment during his first mandate.
The prices are part of an aggressive thrust of Mr. Trump to reset world trade because he says that price increases on people and businesses that buy foreign manufacturing products will finally strengthen national manufacturing.
External economic analyzes suggest that prices would increase the costs of factories that use steel and aluminum, which can possibly worsen American manufacturers.
Canada, the greatest source of steel imports in the United States, criticized the decision.
Candace Laing, CEO of the Canadian Chamber of Commerce, said Trump destabilized the world economy.
“Today’s news clearly show that perpetual uncertainty is there to stay,” she said.
Difficult to see how the prices will not be inflationary
At least part of the idea behind the prices consists in bringing a certain production to the United States, but imposing them will have consequences.
What types of consequences? Well, to its simplest, prices increase prices. It is, when you think about it, blindly obvious.
A price is a tax on a good entry into the country.
So, if aluminum and steel increase in price, it means, the rest equal, that the cost of everything, from the wings to the rivets in steel also.
This in turn means that consumers end up paying the price – and if a company cannot reach both ends in front of these prices, this means job losses – perhaps in the very industrial sectors that the president wants protect.
So says economic theory. But in practice, the economy is not everything.
There are countless examples through the history of countries defying economic logic in search of other objectives.
Perhaps they want to improve their national autonomy in a given product; Perhaps they want to make sure that certain jobs in cherished areas or industries are protected.
But nothing comes for free, and even if Donald Trump’s prices manage to persuade national producers to sow more aluminum or steel, such things do not occur overnight.
In the short term, it is difficult to see how these prices would not be significantly inflationary.
Trump’s tariff war
Trump’s proclamations come a few days after the United States imposed a tariff of 10% on all goods imported from China.
In return, China has imposed 10% tariffs on American crude oil, agricultural machines, wide -movement cars and vans.
There will also be 15% of rates on coal and liquefied natural gas from the United States.
The United States plans to impose 25% of prices in Mexico and Canada was interrupted after the agreements were concluded on border security.
The president of Mexico said that she immediately sent 10,000 national guard troops to the American border in exchange for a tariff delay.
Trump said Mexican soldiers would be “specifically designated” to stop the fentanyl flow in the United States, as well as illegal migrants.
Meanwhile, Prime Minister of Canada Justin Trudeau said nearly 10,000 front -line staff “work and work on border protection”.
He added that his country appointed a “fentanyl tsar”, the drug cartels would be listed as terrorists, and there would be “24/7 eyes”.