by Sundance at The Conservative Treehouse
Today, President Donald J Trump signed an executive order triggering the first ever system of “reciprocal trade tariffs,” a seismic change in U.S. trade policy that will also consider the respective nation’s VAT (Value Added Tax) tariff.
Within the executive order [as outlined], the Secretary of Commerce and the United States Trade Representative will consider foreign industry subsidies, and non-monetary tariff barriers as part of the determination of the tariff levied. This is a stunning shift in U.S trade agreements that will cut through all the angles being deployed to avoid U.S. tariffs and block U.S exports into their country.
The policy will pressure foreign nations to lower their trade barriers to U.S. goods and eliminate disparity in foreign trade agreements. One big example will be the impact on the EU through the continuing Marshall Plan. The EU will now face reciprocal tariffs and no longer benefit from one-way tariff acceptance. There are obviously no tariffs on products made inside the USA.
With “reciprocal tariffs” the Commerce Dept and USTR will now determine the trade imbalances with each individual country and will evaluate each FTA (Free Trade Agreement), one-by-one to deconflict the trade imbalance. Direct tariffs, subsidies, regulatory hurdles, non-monetary trade barriers and hidden export subsidies will be addressed as part of the reciprocity evaluation. This is a completely new dynamic in the era of modern global trade and economics.
During the executive order signing event, President Trump took questions from the media.
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