President Trump called 2 April 2025 “Liberation Day” because this is the day when he announced new sweeping tariffs across the board, meaning, indeed, on all countries across the world. He might as well have called it “Day of Reckoning.”
Did it signal the beginning of a global trade war?
Or, is it just a game by which self-centered President Trump wants to show-off again, as being the one who commands the game, the one who can bend the world to its knees. Or so, he believes. But at what cost? And for whom to pay the cost?
It is a dangerous game, more a gamble than a game. It is the gamble of a typical deal-maker – the extreme is “lose it all,” that is the direction this is going or win it all. “Win it all” for Trump, i.e. the US, is no option. There are too many smarter players around the globe.
By now, at least 75 countries are begging Trump to “negotiate” bilateral tariff structures.
It is not so much a question of cost for the partner countries, but for the US themselves. Washington has much more to lose than the rest of the world. Trump’s aim seems clear: 1) bring back outsourced manufacturing to the US; and 2) attract foreign new investments for manufacturing in the US, with significant tax breaks for new investors.
The cost of either option is astronomical, and even if some countries / corporations are willing to take the risk of moving their manufacturing from a low-wage to a high-wage country – it doesn’t happen overnight. What happens in the meantime when new markets must be found?
Who needs US goods? They hardly produce anything. Most everything you buy in the US is “made in China.” Even Trump’s red MAGA hat is “made in China.” American consumers will suffer the most. A couple of days ago, Trump increased tariffs for Chinese imports from 84% to 125%.
He said, attempting to justify his move before the rest of the world, increased duties are intended to make China realize that “ripping off the USA and other countries is no longer sustainable or acceptable.” On his Truth Social platform, Trump wrote that this was “based on the lack of respect that China has shown to the world’s markets.”
Interesting though, how come everybody buys Chinese goods, not just because they are cheaper than US and other western goods, but also because Chinese quality in many cases is way superior. Chinese production is not subject to the US and western traditional corruption.
Just look at the hundreds of billions-worth of corruption scandals the European Union (EU) is involved in, especially the unelected President Ursula Von der Leyen, or shall we say Dr. Von der Leyen, as in June 2022, she received an honorary doctorate from the Israeli Ben-Gurion University. See video below and this.
Ms. von der Leyen said to her doctorate award:
“Our democracy flourishes if Jewish life in Europe flourishes, too. Throughout the centuries, the Jewish people have been ‘a light unto the nations’. And they shall be a light unto Europe for many centuries ahead. (…)
Long live Europe!
Am Israel Chai!”
Amen. This made Ursula Von der Leyen a forever Zionist, forever protected by the Zionists ruling the world; like President Trump when in 2017 he converted to Judaism.
She is now not only guarded against several lawsuits, because the EU grants her diplomatic immunity, indeed also protecting her buddies-in-crime; but now she is also protected by the ever-Chosen People, the Zionists of Israel and around the world.
*
Back to the tariff game that must go on. It is an utterly destructive game in the end for the US, but a game it is. And China plays along. Good for China, who does not need the US market as much as the US market needs China.
China makes believe gambling in tandem with Trump. China just upped the ante. They increased their tariffs for US goods also to 125% – however saying, that is it. No higher. No matter what Trump does, we will not increase tariffs any further. In casino lingo that means, “Les jeux sont faits”. See this.
Trump is – again – shooting from the hips. Or was and is it a plan?
If it is a planned game, it could backfire miserably for the US. But Trump seems wanting to keep the game going, like a drunken gambler.
In this game or gamble, the biggest players are China and to a lesser extent the EU.
The EU is considering retaliation tariffs of 25%; while most individual EU countries talk about 20%. For now, tariffs are suspended for 90 days on both sides of the Atlantic, as negotiations are being “prepared”.
The EU is divided. There are those who say enough is enough, let us open up to China and Asia in general. Eurasia is a natural partner and an already well-structured market. Forget the oppressive US of A.
Others cannot believe that the US may drop the EU, and still want to adhere to this losing game by tallying up to Mr. Trump’s Washington. In the end, Europe has never been an independent force on her own – thousands of years of exploitation, back to the Roman Empire, and before, colonizing others, up to this very day. They will eventually fall by their own weight into the abyss created between the two fronts.
Just in case, an EU retaliation would have similar effects on the European consumer – at a variation, depending on the importance of US imports for European consumers. This maybe the reason for EU’s semi-clandestine approach to China for increasing trade with China – of course, officially a “no-no”, according to the EU’s own copycat sanctioning of China, as dictated by the Trump Administration.
For China, the game is already won. China for years has oriented its market towards Asia, the ASEAN countries, including the world’s largest free trade agreement, the Regional Comprehensive Economic Partnership (RCEP), comprising of 15 Asia-Pacific nations. The agreement, under preparation for ten years, entered into force on 1 January 2022, encompasses about a third of the world’s population and a third of the world’s GDP. The value of RCEP trade is expected to reach the equivalent of about third of the world’s GDP by 2030.
China also has the Belt and Road Infrastructure, Investment and Trade Initiative spanning the globe, independently of Trump’s tariff fiasco.
In addition, China, a cofounder of BRICS, is strongly committed to BRICS-plus inter-trading, as well as with the Global South (GS) in general. The GS will soon outstrip economic parameters of the G7. In Purchasing Power Parity (PPP), the GS is already stronger than the G7.
China has no market problem without the US. But the US are likely heading towards enormous internal socioeconomic problems, without Chinese goods or high duties on Chinese goods which make them unaffordable to the American consumer – especially middle and lower end consumers. Inflation and unemployment will be soaring.
But the tariff game continues. It is a destructive game for the US, but a game it is. And China plays along. China does not really need the US market as much as the US market needs China.
Everything in the US is “made in China.” You stop the “Made in China” by ridiculous tariffs and the US comes to a standstill – because of inflation, labor loss and an uprooting of the American society – they may not take it. Specially the middle-lower income levels are losing sizable amounts of their purchasing power as compared with their 2024 incomes.
Some analysts are comparing Trump to the stubborn Roman emperors. He cannot succeed. Irrespective of whether Trump politically survives his brutal tariff offensive, a U-turn is imminent, if he wants to avoid major domestic upheavals. The Budget Lab, a research center at Yale University, had estimated the toll on the average household at about US$ 3,800 annually, as compared with the spending power of 2024.
See this for what it means in terms of inflation or consumer loss in 2024 US incomes.
At the same time, Trump announced a military budget of about a trillion US dollars. This is brilliant logic of an extravagant megalomaniac. Or is there something else behind it? Are the global tariffs and the war budget deviously linked?
According to the Budget Lab study, accumulated 2025 US import tariffs were scheduled to grow higher than ever since 1909. The stock market cratering alone wiped out about US$ 5 trillion. Since the first announcement of the tariff shock, the stock market has been like a roller-coaster. Some of the more significant market losses may be recuperated as Trump will negotiate bilaterally; or more, in case he will have to make an inevitable U-turn. Whatever you may call it, it is at best: “Radical policy changes” and an “unpredictable disruption.”
In the light of the just announced one trillion US-dollar war budget, the imminent question arising: Is this game supposed to hide the fact that Trump is unable, or never was really willing, to achieve peace, neither in Ukraine, nor in the Middle East, because the profit stakes are too high for the war industry, and – possessing Ukraine and her riches is just too tempting to let it go. BlackRock has already privatized about half the country without most Ukrainians, let alone the rest of the world – noticing.
*
Click the share button below to email/forward this article. Follow us on Instagram and X and subscribe to our Telegram Channel. Feel free to repost Global Research articles with proper attribution.
Peter Koenig is a geopolitical analyst and a former Senior Economist at the World Bank and the World Health Organization (WHO), where he worked for over 30 years around the world. He is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed; and co-author of Cynthia McKinney’s book “When China Sneezes: From the Coronavirus Lockdown to the Global Politico-Economic Crisis” (Clarity Press – November 1, 2020).
Peter is a Research Associate of the Centre for Research on Globalization (CRG). He is also a non-resident Senior Fellow of the Chongyang Institute of Renmin University, Beijing.
Featured image is from Asia Times / iStock
Global Research is a reader-funded media. We do not accept any funding from corporations or governments. Help us stay afloat. Click the image below to make a one-time or recurring donation.
Counter Information publish all articles following the Creative Commons rule creative commons. If you don't want your article to appear in this blog email me and I will remove it asap.
No comments:
Post a Comment