(AFP) – With markets nosediving over Donald Trump’s trade war, the protectionist US president is hearing the first rumblings of discontent among his normally steadfast backers in Congress and big business. The Republican leader has roiled Wall Street and the global economy with a radical plan announced last week to zero out trade deficits with every other nation by imposing sweeping, indiscriminate import tariffs. Lawmakers beset by constituents worried about investments and pensions have begun adding their voices to a growing clamor for Congress to reassert its power over the nation’s purse strings and rein in the White House.
The seeds of a rebellion sprouted in an unlikely corner as Senator Ted Cruz — a staunch Trump loyalist — warned of a jobs crunch and rising inflation that would threaten the Republican hold on Congress. “If we go into a recession, particularly a bad recession, 2026, in all likelihood politically, would be a bloodbath,” he said on his Verdict podcast. Unlike previous economic convulsions, the current crisis is entirely self-inflicted. Trump claims he is merely correcting decades of supposed international trade abuses that have harmed the US economy, and boasts of the vast revenues he sees his tariffs generating. Barring any last-minute reversal, his so-called “reciprocal” tariffs — broad levies on all imports rather than sector-specific measures — kick in Wednesday, with retaliatory tariffs from China expected a day later.
– ‘Economic nuclear winter’ –
The president shrugged off the markets carnage, spending the weekend fundraising and golfing. “The United States has a chance to do something that should have been done DECADES AGO. Don’t be Weak! Don’t be Stupid!” he posted on Truth Social Monday, urging Americans to buckle up. But Bill Ackman, a billionaire hedge fund investor and one of Trump’s most prominent cheerleaders, warned at the weekend that the United States was “heading for a self-induced, economic nuclear winter.” And Elon Musk surprised Trump’s inner circle by slamming protectionist White House aide Peter Navarro and posting a video of revered late free market economist Milton Friedman extolling the virtues of international trade. The top Trump advisor and world’s richest man, who runs multiple global companies including Tesla and SpaceX, said Saturday he would like to see a “zero-tariff” relationship between the United States and Europe.
JPMorgan Chase CEO Jamie Dimon — a titan of global finance — defended the US right to address global trade abuses in his annual letter Monday. But he added that Trump’s tariffs would fuel inflation and slow growth. Trump critics complain that the messaging from the White House has been confused, leaving lawmakers guessing whether the point is to spark a manufacturing boom or simply to address unfair trade. Trump’s Commerce Secretary Howard Lutnick said at the weekend that the tariffs would generate millions of domestic manufacturing jobs, implying that there was no room for negotiation. But National Economic Council Director Kevin Hassett suggested that the point was to address economic injustice — telling Fox News more than 50 countries were keen to reset their trade relationships with Washington.
– ‘Tariffs are taxes’ –
While Democrats have been hammering Trump over trade, the usually pliant Republican members of Congress have begun to join the chorus of opprobrium, calling for a better explanation of the strategy. Four Republican senators have joined Democrats to push for a resolution ending Trump’s tariffs against Canada. “Tariffs are taxes and Americans are paying the price,” said the most outspoken of the rebels, Kentucky’s Rand Paul, who called on his colleagues to reassert their constitutional authority to regulate foreign trade. Democrat Maria Cantwell and Republican Chuck Grassley are pushing another bill to require congressional approval of tariffs within 60 days. Republican Don Bacon is spearheading a similar effort in the House, although there appears — for now, at least — little chance of success for any effort to constrain Trump in the lower chamber. Speaker Mike Johnson — who decides which bills get to the floor for a vote — is urging Republicans to trust in Trump. “These tariffs restore fair and reciprocal trade and level the playing field for American workers and innovators,” he posted on X. “The President understands that FREE trade ONLY works when it’s FAIR!”
– Frankie TAGGART
© 2024 AFP
