Today, or Yesterday depending on where you are the US announced a series of tariff increases around the world.
The FT explains how they calculated the tariffs; they engineered a number from the balance of trade deficit between the US and their trading partners. This has been a big surprise to most international trade economists. This is written in an amusing style asking questions on economics and supply chains, since the calculation method penalises, those countries supplying goods that the US cannot fulfil domestically, such as bananas and coffee.
In an article called, the stupidest chart you’ll see today, which I cannot understand, but they observe that a floor value of 10% has also been set, and comment,
One last thing not widely mentioned yet — there is also a baseline 10 per cent minimum tariff. Without this minimum, the UK would be treated with a negative tariff. So much for special treatment.
The original article points at the book Trade wars are class wars, where on its hosting page, they say,
Trade disputes are usually understood as conflicts between countries with competing national interests, but as Matthew C. Klein and Michael Pettis show, they are often the unexpected result of domestic political choices to serve the interests of the rich at the expense of workers and ordinary retirees. Klein and Pettis trace the origins of today’s trade wars to decisions made by politicians and business leaders in China, Europe, and the United States over the past thirty years. Across the world, the rich have prospered while workers can no longer afford to buy what they produce, have lost their jobs, or have been forced into higher levels of debt. In this thought‑provoking challenge to mainstream views, the authors provide a cohesive narrative that shows how the class wars of rising inequality are a threat to the global economy and international peace—and what we can do about it.