America’s allies should stand up to its reckless trade policy

OF ALL President Donald Trump’s assaults on multilateralism, his trade policy is the most relentless. On June 1st his administration expanded tariffs of 25% on steel and 10% on aluminium to include imports from allies: the European Union, Canada and Mexico. The tariffs are justified by “national security”, a ruse to render them legal at the World Trade Organisation (WTO). The White House may not stop there. It is investigating whether imports of cars and car parts also pose a “threat”. America’s allies are brandishing their own lists of levies on American imports, as is China. Should they strike back?The arguments against retaliation are clear. A tit-for-tat trade war will unleash destructive mercantilism, which lurks everywhere, not just in the White House. Even in good times, politicians usually forget that the main benefits of trade are higher productivity and cheap imports. Instead, they keep tariffs low chiefly to open foreign markets for their hard-lobbying exporters. The more barriers they encounter abroad, the less value they will see in supporting the global trading system. Decades of progress towards freer trade could unravel.