7h ago

What Canada, Mexico, Japan, the UK, and the European Union should do in response to Trump’s grossly irresponsible tariffs

robertreich.substack.com

What should other nations do? My strong recommendation to Canada, Mexico, Japan, the United Kingdom, and the European Union is to join together to create a free trade zone that excludes the United States, imposing at least a 10 percent tariff on all imports from America.

They should also threaten to limit American banks’ access to their public stock markets, put limits on what their citizens can invest in American companies annually, and increase taxes and regulations on American digital platforms.

They will be tempted to negotiate and do so individually. They should not. They need to negotiate from a position of strength. A non-U.S. free trade union will give them that strength.

5 comments

Tax the rich.

Why just 10%? It should be the same tariff as imposed on them. Or target the same value of selected goods with higher tariffs, like the EU has done before (targeted republican states).

I was having this thought myself but am not familiar enough with international trade to know. It seems to me that bringing down trade barriers outside the US allows coutries to more easily find alternative trade partners to fill the void left by abandoning us ones. It also brightens the effect on America because they won't be able to hold as many businesses hostage.

Absolutely.

It took the EU many years to negotiate trade agreements with Canada, Brazil, etc., partly due to internal disagreements within the EU and complicated national ratification procedures. We don't have kings who can just act on their whims.
Also - it's easier to apply tariffs on physical goods, than on digital services which US exports - coordination is needed to avoid loopholes, but that's complicated, slow.
So, the ideas seem good in theory, but how could this be done fast enough ?
Meanwhile only Russia is laughing, they got their multipolar world ...