Trick or Tariff: Four NO’s in a Row

For those that still wonder, a tariff is a tax on imports. The importer pays the tax and increases the price of the product to the end user to compensate, and the tariff is paid over to the government coffers. The imported product in certain cases becomes too expensive, the exporter cannot find buyers for the product and the local population in the importing country has to stay without or pay 25% more. Then it becomes an issue of demand and supply and everyone in the chain may end up tricked.

Trump is a one trick pony with a hammer. Everything looks like a nail that can be hammered with the tariff hammer. He calls his tariff measures a ‘national economic emergency’ under the International Emergency Economic Powers Act (IEEPA), which authorizes the president to unilaterally manage imports.

25% Tariffs on goods from Mexico and Canada and 10% tariffs on goods from China, on top of other tariffs is the three nails that Trump is hammering now. But the world has changed and the US is not such a sought after export destination any longer. Hence the tariffs are declared on the neighbors of the US, and China can always take a little more squeezing. Let’s hammer them one more time. Smaller importers / exporters in the chain cannot survive this and smaller exporters will find other destinations for their product and smaller importers in the destination country will go out of business as they cannot withstand a 25% hit on their prices to their end users or customers.

And then there is the threat. If any of these countries apply counter tariffs, Trump will double the percentages announced. Tariffs will be applied to European imports to the United States according to Trump and this is not the end of the tariff trick or treat, as Trump has a tariff lollipop that looks like a hammer.

This could upend the economic stability of the world (if there is any stability left) as we know it. We will leave it to the economists to tell us more. According to a fact sheet published by the White House, the tariffs will be in place with no exemptions “until the crisis is alleviated.”

The more interesting story is the one that the tariff measures by themselves omit to tell. Trump has moved in on a neighbor, Mexico, an ally, Canada and a superpower, China.

THEY ALL SAID NO, AND IN DEFIANCE OF THE THREAT OF DOUBLING TARIFFS APPLIED COUNTERMEASURES OR COUNTERTARIFFS and OTHER MEASURES.

Trump is receiving his 2nd, 3rd and 4th NO.  The first NO was that of the Arab nations that rejected Trump’s plan to relocate Palestinians from Gaza to neighboring Egypt and Jordan.  Egypt, Jordan, Saudi Arabia, the United Arab Emirates, Qatar, the Palestinian Authority and the Arab League released a joint statement rejecting any plans to move Palestinians out of their territories in Gaza and the occupied West Bank.  They called for the international community to help “plan and implement” a comprehensive reconstruction plan for Gaza to ensure that Palestinians stay on their land.

Mexico (Claudia Sheinbaum) has said that it has developed three plans, A, B, and C, and instructed the Department of Commerce to implement Plan B, which includes counter-tariffs as well as non-tariff measures.

This is what she said:

MEXICO IMPOSES RETALIATORY TARIFFS ON US TO PROTECT ITS INTERESTS – PRESIDENT

💬 “I instruct the Secretary of Economy to implement Plan B that we have been working on, which includes tariff and non-tariff measures in defense of Mexico’s interests,” Mexican President Claudia Sheinbaum wrote on her X account.

The Mexican president rejected US President Donald Trump’s accusations, blamed the US for selling weapons to criminal gangs.

💬 “If such an alliance exists anywhere, it is in the United States armories that sell high-powered weapons to these criminal groups, as demonstrated by the United States Department of Justice itself in January of this year,” Sheinbaum stressed.

The Mexican economic secretary, Marcelo Ebrard, said the executive order “is a flagrant violation of the T-MEC,” the trade agreement between Mexico, Canada, and the US.

Canada – (Justin Trudeau – a President who has resigned, and the Canadian parliament does not really have a leader) announced counter-tariffs in a soppy speech).

“Tonight, I am announcing Canada will be responding to the US trade action with 25% trade tariffs against $155 billion worth of American goods,” Trudeau said at a news conference on Saturday.

The first wave of tariffs, covering $30 billion worth of US goods, will take effect on Tuesday, with broader measures following in 21 days to allow Canadian companies to adjust.

“These tariffs will be far-reaching and include everyday items,” the Canadian leader said, listing alcohol, fruits, vegetables, clothing, and shoes. In addition to direct tariffs, Ottawa is exploring “several non-tariff measures,” which could include restrictions on critical minerals, energy procurement, and other trade partnerships.

“We will stand strong for Canada,” Trudeau said. “We will stand strong to ensure our countries continue to be the best neighbors in the world,” he added, urging citizens to support domestic businesses.

This is mounting up as the Canadian provinces, one by one, announce their own retaliatory measures in addition to those announced by Trudeau.

LIVE: Canada’s response to U.S. tariffs | EN DIRECT : Réplique aux tarifs douaniers américains https://t.co/1R7HT03O9G

— Justin Trudeau (@JustinTrudeau) February 2, 2025

China (Commerce Ministry) announced that Beijing is “strongly dissatisfied” with Washington’s action and “firmly opposes” it. “It is not only unhelpful in solving [Washington’s] own problems, but also undermines the normal economic and trade cooperation between China and the US,” the ministry stated, adding that Beijing “will take corresponding countermeasures to firmly safeguard its own rights and interests,” without disclosing details. It added that the US should “objectively and rationally view and deal with its own problems” such as illegal drug imports, instead of “threatening other countries with tariffs.”

China is playing by the rules taking it to the RoW:  The ministry said Beijing will file a formal complaint over the new tariffs with the WTO, which has legal power to permit a country suffering from another country’s tariffs to respond with its own. As both the US and China are WTO members, they are required to abide by its decisions when in dispute.

China’s Foreign Affairs Ministry called the tariffs “not constructive,” warning that this could reignite a trade war.

“China’s position is firm and consistent. Trade and tariff wars have no winners… “This move cannot solve the US’s problems at home and more importantly, does not benefit either side, still less the world,” the ministry said in a statement late Saturday. It also warned that the new tariffs will “harm the counternarcotics cooperation between the two sides in the future.”

China’s response to US President Donald Trump’s new tariffs will impact US consumers, manufacturers, and importers, warned Wang Yiwei, director of the Institute of International Relations at the People’s University of China.

“Trump’s strategy and style involve using blackmail to pressure his trade partners into making concessions, which is why he initially threatened 60% tariffs …  The US economy would not be able to withstand such a blow, as 90% of the tariff costs would fall on American consumers. He still needs to take care of the country’s economy.”

Wang noted that the 10% tariffs are tied to campaign promises rather than just trade issues. Initially meant to balance the deficit, they are now aimed at disrupting China’s role as the “world’s factory.”

China, Wang added, will stick to World Trade Organization principles but also take countermeasures to protect its interests, making US industries pay the price.

It is fascinating to speculate how Trump, the demagogue, will deal with the concept of receiving four NO’s in a row. He did show some power projection, by firing a few missiles into caves in Somalia (again), this time targeting a “senior ISIS attack planner” in the Golis Mountains. The strikes were carried out using manned fighter jets from the USS Harry S. Truman.  The Pentagon claims the operation “eliminated multiple operatives” without harming civilians, which may be hot air: https://t.me/ChroniclesWorldOrderZ/3405.

Brian Berletic frequently speaks about the continuity of the US government. The continuity here is that the US hurts and tries to make the rest of the world heal its boo-boo, as the Chinese commentators highlight sharply. Trump is now routinely depicted as a crybaby, and “everybody has done me wrong, and we did so much for them.” (Cry me a river, and where is that tiny violin!).

Is it too soon to say that others will do the minimum of business with the US? That the Latin Americas will become an open supermarket for China and Eastern countries? Remember the piece about the Manzanillo port in Mexico that nobody knew about? How big is your capacity for change? because we will have change in unexpected ways. To paraphrase Prof. Wolf in the last discussion with Michael Hudson, this tariff regime is not linear, and effects cannot always be foreseen or directly connected to causes.  As we always said when doing superlarge projects, a project like this is like jello.  You touch it over here, and it jiggles over there.

UPDATE:  Trump has announced if Canada is to retaliate with Tariffs of their own, the 25% tariffs will increase, likely double.

This is all very interesting, but why?  Trump told us.  It is a mob shakedown, a protection racket.   You gotta pay the vig for pretend protection – exactly like the old mob novels used to tell us the mobsters did:

Donald J. Trump @realDonaldTrump

The “Tariff Lobby,” headed by the Globalist, and always wrong, Wall Street Journal, is working hard to justify Countries like Canada, Mexico, China, and too many others to name, continue the decades long RIPOFF OF AMERICA, both with regard to TRADE, CRIME, AND POISONOUS DRUGS that are allowed to so freely flow into AMERICA. THOSE DAYS ARE OVER! The USA has major deficits with Canada, Mexico, and China (and almost all countries!), owes 36 Trillion Dollars, and we’re not going to be the “Stupid Country” any longer. MAKE YOUR PRODUCT IN THE USA AND THERE ARE NO TARIFFS! Why should the United States lose TRILLIONS OF DOLLARS IN SUBSIDIZING OTHER COUNTRIES, and why should these other countries pay a small fraction of the cost of what USA citizens pay for Drugs and Pharmaceuticals, as an example? THIS WILL BE THE GOLDEN AGE OF AMERICA! WILL THERE BE SOME PAIN? YES, MAYBE (AND MAYBE NOT!). BUT WE WILL MAKE AMERICA GREAT AGAIN, AND IT WILL ALL BE WORTH THE PRICE THAT MUST BE PAID. WE ARE A COUNTRY THAT IS NOW BEING RUN WITH COMMON SENSE — AND THE RESULTS WILL BE SPECTACULAR!!!

Listen to Prof Wolff on the results of this: