Trump is considering a move that would be his biggest step yet toward a trade war

President Donald Trump.

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President Donald Trump.
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Alex Wong/Getty Images

  • President Donald Trump is pushing for a sweeping tariff on all steel imports, the harshest of three possible actions recommended by the Department of Commerce, according to multiple news reports.
  • Some in the White House are said to be attempting to get the president to go for a more targeted, less harsh action on steel.
  • Such a broad tariff would be likely to spark retaliatory action from other countries and could be the opening salvo of a trade war.

President Donald Trump is reportedly considering a move that could push the US into a trade war as the administration enters a critical stretch for trade policy.

According to multiple reports, Trump is pushing for a sweeping tariff on steel imports, as well as considering other protectionist trade measures that could prompt retaliatory measures from other countries.

As part of a review of the national security ramifications of steel and aluminum imports, the Department of Commerce sent Trump three recommendations about possible actions designed to cut the amount of incoming metals.

A report from Bloomberg on Friday said Trump favored the harshest of these recommendations for steel: a 24% tariff on all imports, regardless of country.

In a follow-up report on Sunday, Jonathan Swan of the news website Axios said Trump wanted to go even further, favoring a 25% tariff because it is a round number and “sounds better.”

Trump’s said during a White House meeting with a bipartisan group of senators on February 13 that the administration could slap “substantial tariffs” on imports.

Regardless of the exact number, any major tariff on steel imports is likely to lead to blowback from other countries.

A report in July said the European Union, a major exporter of steel to the US, was looking into retaliatory options, including tariffs on US agricultural goods. China, meanwhile, is reportedly researching possible action on US soybean imports.

Trump is also considering several measures directed at China that could impose new trade restrictions, including possible action on intellectual-property theft.

Economists have long been worried about the potential for more protectionist trade policies under Trump – something they argue could prompt retaliatory action. In the worst-case scenario, many economists say, a trade war could push the US into recession.

Given the potential for economic downsides to such a trade fight, many members of the White House are apparently trying to persuade Trump to take less harsh action than a broad tariff on steel.

According to Bloomberg, among those urging Trump to go with a targeted approach to avoid angering allies are Gary Cohn, the director of the National Economic Council; James Mattis, the defense secretary; and H.R. McMaster, the national security adviser.

The possibility of new tariffs and trade measures has worried international partners. In a recent interview with the German news organization DPA, Roberto Azevedo, the director-general of the World Trade Organization, warned that a trade war could “come up at any time, and in ways that we don’t expect.”

The WTO chief also said the Trump administration’s protectionist views on trade were unlikely to reverse anytime soon.

“I don’t see at this point a conversation that will lead us to believe that a solution is in the making,” Azevedo said.

The Trump administration is nearing several critical junctures on trade.

In the short term, Liu He, a senior Chinese economic adviser who is close to Chinese President Xi Jinping, is expected to meet with senior administration officials to discuss trade disputes.

In the longer term, Trump must decide by April 11 and 19 whether to impose tariffs on steel and aluminum imports.

Meanwhile, negotiations about the North American Free Trade Agreement are ongoing.