Whenever Donald Trump mentioned his plan to sample huge prices on imports in the United States, there has been a widespread assumption that they will be delayed, watered or brought back.
Today, he will reveal in Rose Garden White not only how serious he is on the “most beautiful word of the dictionary”, but actually calls time on decades of economic globalization.
And it is always possible that he does it by launching the equivalent of a salvo of ballistic missiles in the world trading system, with a universal price on all imports in the United States.
The option of a universal tariff of 20% is the only way to reach some of the massive revenues of billions of dollars claimed by some of its advisers.
In recent days, President Trump has been categorical that the prices will be “reciprocal” and that the United States will be “more beautiful” for its business partners.
This does not exclude large-scale taxation of prices at 10 or 20%, if, for example, the United States believes that value-added taxes are prices.
It is possible that countries can be very largely in parentheses in different levels of a fundamentally universal rate. Like a G7 negotiator told me on weekends, “everything comes down to President Trump”.
A system like this, with equivalent global reprisals, would see the British economy narrowed by 1%, enough to eliminate growth and cause pressure for tax increases or spending reductions.
The total cost of the world could, according to a study by business schools at Aston University, be 1.4 billion of dollars (1.1 tn £), because trade is diverted and prices increase.
In the industry, the European Union is expected to target American technological companies. There could be completely contrast if the United Kingdom chooses not only to retain reprisals, but to offer a significant tax reduction to us Big Tech.
Trade wars are difficult to win and easy to lose for everyone.
A universal rate of 20%, or its equivalent, would be a historical success for the global trade system, tied with the infamous prices of Smoot-Hawley almost a century ago.
However, there is something bigger here. As vice-president JD Vance said it in a speech last month, globalization failed in the eyes of this administration because the idea was that “rich countries would increase more in the value chain, while poor countries did the simplest things”.
As did not happen, especially in the case of China, the United States is moving away from this world.
If the United States is monitoring its hand to alienate its allies today, China will wait. The blow of American business in Europe, for example, could be offset by electronics, clothes and cheaper toys from the East by arriving in the United Kingdom and lowering prices, diverted from the American market.
What starts later in the day is designed not only to reshape America and trade, but the way the world itself has been managed.
