Tariff Time
At the stroke of midnight on Wednesday American tariffs took effect in 90 countries. The tariffs were the highest in a century.
They start at 15 percent and rise to 35 percent for Canada and 50 percent for Brazil and India. Brazil is the victim of Trump’s anger over the decision to prosecute his friend Jair Bolsonaro for attempting to overthrow the government. India has been hit with a 25 percent punitive secondary tariff for importing Russian oil.
The Trump Administration is still talking to Mexico and China. Currently the tariff on Chinese goods is 30 percent. Deals have been struck with the UK, EU, South Korea, Japan and Vietnam.
So far this year, tariffs are estimated to have contributed $152 billion to the US Treasury. Trump has said this is only the start. He is threatening more and higher tariffs on pharmaceuticals and computer equipment and chips.
So far, the impact on the US economy has been nominal. But this is because American businesses stockpiled foreign goods before the tariffs took effect and consumers have been paying pre-tariff prices.
This will soon start to change, although the latest rise will not work its way through the pipeline until early October. However, businesses have been warning the administration that they cannot keep prices down much longer, and in fact, they are signs of inflation for items such as appliances, clothing and furnishings. The full impact will be ready in time for Christmas.
The Yale Budget Lab reckons that once all the tariffs have worked their way through the pipeline, the cost to the average American household will be $2,500 and half a percentage point will be shaved off the US economic growth figure.
Gaza
Trump to Moscow?
Trump is set to fly to Moscow. The exact date is unknown, but can be as early as the coming week.
After talks with Vladimir Putin, the US president will fly to Kyiv to meet Ukrainian President Volodomyr Zelensky. Putin has refused a trilateral Ukraine-Russia-US summit.
The announcement of Trump’s travel plans came after a three-hour Kremlin meeting on Wednesday between Putin and Trump’s envoy Steve Witkoff. No firm details have emerged from that meeting but Russian sources say that Putin “has conveyed certain signals.”
The most likely signals he could have sent would have been concessions on his territorial demands. In a June memorandum, the Russian leader clear set out his demands for peace: Russian sovereignty over the Ukraine regions of Crimea, Donetsk, Luhansk, Zaporizhzhia and Kerson as well as the demilitarisation of Ukraine, Ukrainian neutrality, no formal military involvement and new elections.
From the Ukrainian point of view this would mean total surrender and a return to the status of Russian puppet state.
According to Russian sources, the key to Putin’s demands is control of Ukraine. How he achieves that goal is open to negotiation. It could be through NATO guarantees, territorial control or combination of the two. The latter seems the most likely.
El Salvador
In 2024 US State Department report on El Salvador said there was widespread “government-sanctioned killings, tortures and harsh life-threatening prison conditions” in the Central American country.
This year, the State Department reported that there are “no credible reports of significant human rights abuses.” The key words—which could be open to interpretation—are “credible” and “significant.”
The State Department also declared its support of the end of presidential term limits. This means Trump’s Central American friend Nayib Bukele can remain in office for life.
The State Department said: “El Salvador’s Legislative Assembly was democratically elected to advance the interests and policies of their constituents. Their decision to make constitutional changes as they see fit. It is up to them to decide how their country should be governed.”
Trump upsets Switzerland
They are especially angry because in May Swiss president Karin Keller-Sutter met with Treasury Secretary Scott Bessent and was told that US tariffs were likely to be just ten percent—21 percent lower than Trump announced on social-called “Liberation Day” on April 2.
Now they have learned that that they will be eight percent higher than previously declared.
So why pick on the Swiss? Well, according to the White House, it is because the Swiss have a $47.4 billion trade surplus with the US. But the Swiss have responded by promising to drop their tariffs on US industrial products to zero and invest enough money in the US economy to create 400,000 jobs.
In the realpolitik world of Donald Trump that is not enough. Switzerland is—in his political playbook—a politically insignificant country of 9.1 million which he can financially punish without suffering any major repercussions.
In the meantime, according to the Swiss daily “Neue Zurcher Zeitung”, Switzerland has suffered its biggest defeat since the Battle of Marignano in 1515 which resulted in victory for the French and perpetual neutrality for the Swiss.
India
The Indians thought Trump was their friend. He hinted at support for permanent Indian membership of the UN Security Council; regarded them as a key component of the four-nation Quad Security Agreement and told Narendra Modi that he was a bulwark against China.
So why slap 50 percent tariffs on their exports to America—25 percent as the base and another 25 percent punitive tariffs for importing Russian oil and gas.
Once again, it comes down primarily to India’s trade surplus with the US– $108 billion.
Money, in Trump’s playbook, overrides friendship and security agreements every day.
So what will the Indians do? For a start, they have refused to stop buying Russian energy. They need it to keep the wheels of Indian industry turning. On top of that, because of the Ukraine War, Russian oil is cheap at the moment.
They can also impose retaliatory tariffs. The problem with that is while the US is India’s top export destination (18 percent), India is America’s tenth.
But there are other less tangible methods of retaliation. One is the Quad. India is due to host a Quad heads of government summit later this year. That could now be in jeopardy. The other is India’s relationship with the BRICS countries which are increasingly seen as an alternative to American hegemony.
And finally, there is the market and people of India. The Indian economy is growing and a staggering 7.4 percent a year. It will soon pass Japan as the world’s third largest economy. It may at the moment be number ten on the American export list, but that would change dramatically without tariffs.
Finally, there are the people of India who are one of the best educated and entrepreneurial in the world. They provide the business and intellectual backbone for businesses, education and government around the globe. They will take note of their treatment of Donald Trump.
* Tom Arms is foreign editor of Liberal Democrat Voice. He also contributes to “The New World” magazine and lectures on world affairs. He is the author of “America Made in Britain,” two editions of “The Encyclopaedia of the Cold War” and “The Falklands Crisis.”
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14 Comments
A picture is worth a thousand words. True.
But this film by Layla Moran, just 10 days after the tragedy of 7 October 2023, is worth a million:
Nevett, Joshua (17 October 2023). “Layla Moran: My relatives have nowhere to go in Gaza after bombing”. BBC. Retrieved 21 December2023. https://www.bbc.co.uk/news/uk-politics-67139289
Layla, whose cousins live in Gaza City, must be devasted. Today we read in the Guardian: ‘The plan announced on Friday is for an operation to take military control of Gaza City, home to a million displaced Palestinians. They will be forcibly evacuated, yet again, to the southern Gaza Strip over the coming weeks.’
In today’s Observer we read: ‘When Israel invaded Gaza nearly two years ago, it vowed to eliminate Hamas and save the hostages in a campaign it predicted would last several months. After 22 months of fighting, those goals elude them still. Israel controls about 75% of the Gaza strip and has wiped out Hamas’s leadership, but the group remains active and is holding around 50 hostages, though only around 20 are believed to be alive.’
On 14 October 2023 October Patrick Cockburn wrote: ‘Israeli air war will destroy Gaza but not Hamas
https://inews.co.uk/opinion/israeli-air-war-will-destroy-gaza-but-not-hamas-2686976
Why did people NOT act on Patrick Cockburn’s advice?
In the mid 1980s I did SADF national service involving a spell in Soweto. Having to occupy and police any urban area will be dangerous,long and expensive. It will be scary and many soldiers will be trigger happy jumpy. I well remember standing alone-ish in the dark with Galil rifle. Many Israeli soldiers will feel the same. They will be wrong to think once they have taken Gaza city that all their troubles are over. They may be about to get a lot worse.
Ukraine….Trump stated that he’d end the war by imposing massive sanctions and tariffs on Putin by last Friday. Instead he’s letting Putin keep the land he’s invaded and cancelling the tariffs/sanctions..
Trump puts tariffs on America’s allies and cedes Ukraine to America’s enemy..
TACO Trump strikes again. what a guy!
@expats
I actually believe Trump genuinely wants to end the war in Ukraine. I think he realises that Ukraine will not be able to push Russia out of the territory it has seized, and that the longer the war continues, the more territory Ukraine will lose. So, getting Putin to agree to a peace deal now would be on better terms for Ukraine than if the war continued for a few more years. No doubt Trump would be condemned for not continuing the war ‘until the last Ukrainian’, but if it saves lives and results in a better outcome for Ukraine than the alternative, then he should pursue that route.
“We want, like you, a sovereign and prosperous Ukraine. But we must start by recognizing that returning to Ukraine’s pre-2014 borders is an unrealistic objective.
Chasing this illusionary goal will only prolong the war and cause more suffering”….Hegseth..
2 years on from the Ukrainian spring offensive , the Ukraines are just about holding a line at huge costs…Long range artillery, Western tanks and armoury have all been vulnerable to drone attacks…For Ukraine to go back to it’s pre 2014 borders – the West needs to explain how you get to that position in the Donbas & Crimea.
Brenda Will 10th Aug ’25 – 5:56pm……….. So, getting Putin to agree to a peace deal now would be on better terms for Ukraine than if the war continued for a few more years…….
Brenda, So you believe that Putin will be “Content with what he has and won’t come back later for more?”
May I draw your attention to Kipling’s..
“And that is called paying the Dane-geld;
But we’ve proved it again and again,
That if once you have paid him the Dane-geld
You never get rid of the Dane.”
In response to Brenda:
We thought the same with Hitler, and look what happened.
We allowed Putin to take Crimea, Transnistria, Abkhazia, South Ossetia, Donetsk, Kherson, Luhansk, and Zaporizhzhia.
We allowed him to decimate Chechnya.
We allowed him to let his pack of wild beasts, the Wagner Group, commit heinous war crimes in Syria and across Africa.
And each time we allowed him, he came back for more.
Why do we enable tyrants to continue hurting innocent people?
Giving him more and more land will not deter him; it only encourages him.
Ask yourself this: if a tyrant told you that they would stop hurting people, if it meant you give up a loved one to them, to do with as they pleased, would you?
That is what every nation ever attacked by such evil has asked itself, and each time, they’ve said no.
Please don’t make them give up their loved ones to appease a monster.
Expats; 2 years on from Ukraine’s spring offensive & they are just about holding a line -bravely – but with significant cost.
How do we get to the Ukrainian position of pre 2014 borders in the Donbas and Crimea.
Whose freedom is for sale after Ukraine’s Brenda? Where do we draw the line?
@Brenda – We should remember Agent Krasnov (aka Trump) has previously stated Ukraine should just roll over and accept whatever Putin wants. Which a small amount of research will reveal he desires to restore the territory once occupied by the USSR to Russia.
We need to assume that whatever Trump claims to have agreed with Putin at their forthcoming meeting, will be both not the complete truth and detrimental to both the Ukraine and Europe.
Craig Levene 11th Aug ’25 – 12:40pm…Expats; 2 years on from Ukraine’s spring offensive & they are just about holding a line -bravely – but with significant cost.
How do we get to the Ukrainian position of pre 2014 borders in the Donbas and Crimea…
Craig, The cost is not one way. I’m sure, after his initial promise of ‘a few weeks’, Putin wishes he hadn’t started this war; however, it’s now all about Putin’s ego..
As for pre 2014 borders, no-one realistically expects Crimea to be returned to Ukraine but Ukraine would settle for pre February 2022 borders with a guarantee, for what it’s worth, of a ceasefire..
If Putin accepts he saves face AND it lessens the chance of him ire-invading a prepared Ukraine… However, if he’s allowed to keep post 2022 territory, it will be a victory to be re-visited later.. My ‘Danegeld’ reference holds..
Once peace is achieved in Gazae we need a global reconstruction conference to rebuild it. This could be organised by the UN or more ad hoc. Part of the peace treaty would be the framework for such a conference.
Craig Levene 11th Aug ’25 – 12:40pm..
Craig.. I replied to your post but it’s disappeared..
and, now, reappeared..