Trade war would have U.S. casualties
Allies hit with tariffs threaten to retaliate
WASHINGTON — If a trade war is coming, the cheesemakers of Wisconsin are standing in the line of fire. So are the farmers of the Great Plains and the distillers of Kentucky. And the employees of iconic American brands like Harley-davidson and Levi Strauss.
The likelihood of a trade conflagration leapt closer to reality this week after the United States imposed tariffs on steel and aluminum imports from Canada, Mexico and the European Union. Infuriated, the jilted U.S. allies vowed to retaliate with tariffs of their own. And in a separate dispute, China is poised to penalize $50 billion in U.S. goods — many of them produced by supporters of President Donald Trump in the America’s agricultural heartland.
“They’re going to hit the farmers,” said Bryan Klabunde, a farmer in northwestern Minnesota. “We want things fair for all industries, but we’re going to take the brunt of the punishment if other countries retaliate.’”
President Donald Trump, who entered office promising to rip up trade deals and crack down on unfair trading practices, is clashing with trading partners on all sides. To the north, he’s battling Canada; to the south, Mexico; to the east, Europe; across the Pacific Ocean to the west, China and Japan.
“The president seems to be creating trade (and other) disputes with everyone — allies and adversaries alike — and it’s difficult to discern any coherent strategy,” said Rod Hunter, a former National Security Council staffer under President George W. Bush.
Mexico plans to retaliate against the steel and aluminum tariffs by targeting U.S. cheese, among other products.
“It’s our second-largest market,” Jeff Schwager, president of Sartori, a cheese company in Plymouth, Wisconsin, said of Mexico. Retaliatory tariffs “will reduce sales — there’s no question.”
The EU is threatening to penalize Kentucky bourbon and the motorcycles of Wisconsin-based Harley-davidson. The potential tariffs pack a political punch: They’d hurt constituents of House Speaker Paul Ryan, a Wisconsin Republican, and Senate Majority Leader Mitch Mcconnell, a Kentucky Republican.
On Friday, reporters in Louisville, Kentucky, asked Mcconnell if he thought the Europeans were trying to get his attention.
“Well,” the Senate leader said, “they got my attention. They didn’t need to do that. These are our friends. These are not enemies. Canada and Mexico, Europe — these are our allies, and we need to work this out in a way that’s comforting to everyone.”
Harley-davidson has already absorbed higher steel and aluminum costs since Trump first announced the metals tariffs three months ago. Now, the threats of retaliatory tariffs from abroad raise the fear of higher prices for Harley motorcycles sold outside the U.S.
In a statement, Harley-davidson said retaliatory tariffs “would have a significant impact on our sales” in those countries. The Milwaukee-based company said it was evaluating options for controlling higher materials costs.
The jeans maker Levi Strauss is also on the EU’S target list.
“American brands, workers and consumers will ultimately suffer,” the San Francisco-based company said in a statement.