It is the fault of all FT colleague Rob Armstrong to invent Taco concept (Trump always excludes chickens), obviously. I asked you This time last week whether Trump Steel and Aluminum (whichever) will proceed with tariffs, he threatened at the end of the last week. You are almost divided below in the middle. But right yes what the balance of reactions for the camp felt, and I quote a loyal reader, “mostly because he wants to avoid ridicule by Rob Armstrong”. So instead of Taco, I am presenting Tabasco (angry with Trump Armstrong, calling the chickens as a new paradigm, and everyone is facing their pension funds, which is being erased, can thank Rob for this.

Today I see why steel tariffs move forward and why those pension funds were still not erased. As yet. But before I check that perhaps the market (and certainly all rests) should be more afraid of the ongoing disintegration of the US Republic. Chartered Waters, Where we look at the figures behind the world trade, the dollar is on the euro.

Trump unrestricted

I have considered what will usually be seen as the most extraordinary function of disastrous protectionism, 50 percent – fifty percent – tariff on steel and aluminum, for other items in today’s newspaper. What is happening in American politics, there is a greater threat to openness and prosperity than any personal work of business policy.

Back in February, Trump Administration two weeks, I wrote that The tariffs were at least at least, and what really meant was the destruction of a republic by the President and his chronies. And well, here we are snatching the roads on the road and out of the courtyard with American residents, soldiers being deployed on the streets of American cities to suppress the protest, and the pillars of tanks going to the capital of the country for the President’s birthday parade.

It turns out that his chronies are optional extra. The spat of Trump with Elon Musk last week only underlines that except for the upheaval of the financial market and except for the fear of economic destruction, stands on its way to collect and centralize power. Is mine Associates write Ed LuceThe trump-mascal logic is actually about psychology, not economics. But even if Musk was actually a fiscal fiscal eagle and free merchant, there is no way that he may oppose the unaffected tax cuts from Trump White House or pressure in favor of a wildly destructive tariff war.

Nor has the real resistance to Capital Hill. Hunting for real Republican Budget Hawks is now useless for decades. The discovery of the staunch Republican guards of the Congress’s privilege on the trade policy against Trump is similarly vacant.

Musk seems to be angry at the budget bill taking a tax break for the sale of electric vehicles. ,He denied this On X, but he, he will not?) This is a relatively new development. As recently, as a march, based on Musk’s previous comments, the general belief between EV-Vacurs, that was that Will face tesla And even the elimination of tax credit is beneficial. Removing tax brakes will strengthen the company’s leading position in the US market (which was helped by Credit establishing). It was also believed that Tesla tariff was relatively untouched by growth, despite the release of some of the company Warning on that subject And mask Infant exchange White House on trade policy with China Hawk Peter Navarro.

It seems that this will not happen now. Bloomberg report The musk personally advocated the House speaker Mike Johnson to maintain the EV tax credit. It seems that the political activities of Kasturi and the efficiency of the government of their so -called government for the venture of the venture Tesla’s sales hurt everywhereTo the extent that it needs to try to expand the overall EV market in the US, not just keep obstacles for new entry.

It will not take a stone heart to laugh, and the interests of the musk will suffer more damage to the lack of its political clots. (America is unlikely to try to force business partners Buying one of one Their starlink satellite systems are any more.) But finally, it shows that Trump has continued to cure the American trade and fiscal policy by someone in administration, as if it is unpublished by the Congress or currently by the courts.

The federal courts may prevent Trump from misusing the International Emergency Economic Power Act (IEEPA). But as I said last week, there are many other equipment that he can change. Meanwhile, regarding the tariff case and the widespread question of the President’s powers, read that the former federal court has appealed to Judge Michael McConal (appointed by George W. Bush). Wrote here In the New York Times.

Federal law books are uncontrolled with words, which if widely interpreted, can empower Mr. Trump and future presidents, who were never deliberately assigned by the Congress to take themselves to wide powers. If the courts maintain Trump Tariff, it will be a big step towards the presidency that the President wants to do.

Financial markets are currently taking a significant approach about the fact that a tamasic and economically illiterate President has such freedom to function. As long as they continue, or as long as the severe economic dislocation forces Trump to reverse, it will pursue the way she is.

Steel

I wrote Last week’s business secret column (And repeated it in FT Marshy notes podcast On Saturday, Report here) Steel often dominates trade disputes, especially in the US: often fake national security rationale, the humility of job loss in one industry cities in American swing states, global overvival and oversuply, general viral of economic viral.

The second reason, of course, is that it is a good way to create large optics without disastrous economic damage. Steel is not really so important. Oxford Economics increased marginal damage by 50 percent by increasing steel and aluminum tariffs, not more than 0.2 percent of GDP. Uncomfortable use of anti-dumping and anti-subsidy duties means that America only imports about a quarter of its steel. Therefore, Trump then carried out thesco strategy without teasing the markets.

People with very long memories when George W. Bush will remember tremendous disturbance Apply tariff on steel in 2002 And the business causes too much and teeth between types. It was a completely eccentric practice, designed to help them in the mid -term elections of 2002, which worked and did not derail the economy. The tariffs were clearly against the rules of the World Trade Organization; Bush knew that he was. He knew that he would lose Unavoidable WTO Case (For the European Union, in the event). He knew that overall economic damage would be non-consolidated but limited. He knew that he would be able to explain the steel industry that he performed his best, but was thwarted by the abusive foreigners in Geneva. Probably Steelworkers also knew a lot. It’s all a gameThis is only steel.

And repeatedly playing this game makes it more marginal every time. Steel is an important input for other industries, but protecting the area helps to hurt it, as often protection. Ed Gorcer of Progressive Policy Institute Tells After Trump’s steel tariff in 2018, the production of that steel in the US actually declined, and was less in 2023 than in 2017. If you make something more expensive, people use it less. Unreliable, but true.

Chartered water

The dollar increased against other major currencies including the euro, after some stronger than the data of the expected jobs at the end of last week. But it is still very weak before Trump assumed. Please note: This is not a legendary Mar-e-Lago agreement at work.

Trade relations

• Willing to catch America and China A new round of high-level trade talks Today in London.

• A New York Fed Survey states American manufacturing and service companies are undergoing tariff costs for their customers, despite the hazards against Trump’s companies.

• FT’s free lunch newsletter They say Trump claims that his policies are bringing to America, it is a mrust.

• China is In itself For more fighting on export control, but Fast-tracking license for rare earth For some European companies.

• Ministers’ meeting in OECD Was shaken Trump’s Go-It-alone is not much idea about promoting WTO by business theory, and anyone.

• Politico’s Graham Lankanti See The non-state of the UK-US trade deal was very proud of the government of Sir Kir Stmper.

• A paper from the Lovi Institute sees that some people say “Global South” Navigate a post-US world order,

Trade secrets are edited by Harvey Nripia