US businesses brace for impact of all-out trade war
'Well, I don't know how they can retaliate,' Trump told reporters at the White House, when asked about the EU's new trade war preparations. 'You know, they've made a lot of money. They've treated us very badly, but now they're treating us very nicely, and I think we'll end up, I think everybody's going to be happy with the EU.'
Some EU countries, however, are not in the mood to make nice after Trump once again upended the negotiations, sending a blunt weekend letter saying he planned to raise tariffs on the bloc to 30 percent.
'We are partners, and we must reach an agreement,' French Foreign Minister Jean-Noël Barrot said at a Foreign Affairs Council meeting in Brussels Tuesday. 'The European Union is the United States' largest trading partner, but it is not destined to become a vassal of the United States.'
The letter also outraged some in Japan, which has not, to this point, threatened any retaliation to Trump's tariffs. 'We may have to rethink whether being nice, polite, diplomatic, is something that would move President Trump,' a former Japanese official said last week. 'It appears that leverage is the only language that will be understood by the White House.'
Domestic companies fear the increasingly harsh rhetoric could escalate into soaring tit-for-tat tariffs next month, which is especially alarming for those that have been in the cross-hairs of a Trump trade war before.
Despite months of lobbying from Ireland and France, the EU included bourbon among its tariff targets, in a repeat of Europe's tariff strategy during Trump's first administration.
The previous retaliatory tariffs, aimed at the signature industry of then-Senate Majority Leader Mitch McConnell (R-Ky.), caused American whiskey exports to Europe to drop by 20 percent between 2018 and 2021, according to the Distilled Spirits Council, a trade group representing the liquor industry.
'This is devastating for the bourbon industry,' said Rep. Morgan McGarvey (D-Ky.). 'We don't have to guess, we can just look at what happened last time.'
This time, the bourbon industry has also taken a hit in Canada, where the government-controlled liquor stores have pulled 'Made in the USA' products like bourbon from the shelves in response to Trump's threats to make Canada the 51st state.
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