Two centuries of U.S. trade politics:

This week's Trade Secrets newsletter. The next stage of the EV trade war is Chinese automakers investing around the world to jump over tariff walls. The EU is welcoming them in. The US? Not clear, though Trump, interestingly, is keen.

on.ft.com/44QFZ4W

I'm likewise unenthused by the Biden tariffs. But they cover <1% of the trade that Trump's proposed tariffs would. Costs to consumers are orders of magnitude smaller.
Biden's newly announced tariffs target $18b in Chinese imports; Trump's cover >$3 trillion (trillion with a 'T')

'Are trade wars class wars? The importance of trade-induced horizontal inequality' sciencedirect.com/science/articl…
'Over 99% of the variance of welfare changes from trade shocks arises within income deciles. These findings run against a popular narrative that 'trade wars are class wars''

First, it’s not <all> about national defense. It’s also, as protectionism always is, about domestic politics

2nd, this is literally the oldest, most banal justification of protectionism ever. You can read Douglas Irwin’s “Against The Tide” on this

Third, these writers aren’t wrong

What if -- and I know it sounds crazy but give it a chance -- a WTO appeals body had 'certiorari-like' discretion over whether to accept appeals? Law prof Alan Sykes makes the case for it:

ielp.worldtradelaw.net/2024/05/alan-s…

Great piece on the regressivity of the Trump tariffs/Trump fiscal agenda from Catherine Rampell at The Washington Post, covering our brief out yesterday from @piie.

Your total tax burden would probably go up under Trump. Yes, up. wapo.st/4avEv1t

The 1950s and 60s American industrial base had a lovely subsidy of not getting blown up.

One thing that I think gets lost in this conversation is that the 'China shock' is 'China industrializing' moreso than it is 'China joined the WTO'.

New policy brief from ⁦Kimberly Clausing⁩ and me. Economists forecast $500bn annual hit from new Trump tariffs via Financial Times
on.ft.com/3V8hkWv

#CPTPP members have set up an 'informal standing forum to facilitate information sharing' on future accessions.

Not long now before the fun and games begin over China's accession bid ...

UK is now CPTPP member - but can't access tariff preferences etc until 6/11 members ratify.

Now available on KEI

Looking forward to a discussion of how tariffs and subsidies limit competition and increase corporate power.

It can be hard to get a sense of the digital trade disputes that int'l rules might help resolve. A good example is the ongoing Japan-Korea conflict over social media platform Line. Haeyoon Kim & I wrote about the security/discrimination issues here:

keia.org/the-peninsula/…

America is joining its frenemies back in the fossil fuel club, writes David Fickling. Massive oil reserves mean less enthusiasm about energy transition than China trib.al/kU1wkNc via Bloomberg Opinion

With America Off-Limits, China EV Makers Aim to Conquer Rest of World—Carmakers in China accelerate sales push in Europe and Southeast Asia, and look to produce more abroad
Yoko Kubota Sha Hua 华沙
wsj.com/business/autos…
wsj.com/business/autos…

A way to avoid all the new Google search clutter 👇

Stunned by the latest US tariffs against China for many reasons including that inflation is consistently the biggest concern of voters. What if tariffs push up critical upstream prices? What if China retaliates, pushing up prices of all sorts of consumer goods?

Other US foreign policy actions got in the way.

When did the US use a laissez-faire approach?