Investors have been edgy about President Trump’s trade dispute with China. But there’s another trade threat that’s going to flare soon: The possibility of new tariffs on nearly $200 billion worth of automotive imports, which would kill jobs and send car prices soaring if Trump imposes them.
Last year, Trump directed the Commerce Department to investigate whether automotive imports pose a threat to national security, with a report due no later than Feb. 17 of this year. If the report finds cause for concern—as everybody expects—it would give Trump the authority to impose tariffs within 90 days. And he has already proposed a 25% tariff on imported autos.
The premise is ridiculous: Nobody in the national-security business thinks imported cars are a threat. But the threat of tariffs is leverage Trump feels he needs to strike better deals on trade with Europe, Japan and China. Trump, for instance, wants those nations to lower their own tariffs on imports from America and make it easier for U.S. firms to enter those markets.