Latest news with #Trumpland
Scoop
04-08-2025
- Business
- Scoop
On The Perils Of Trading With Trump
Luxon did protest too much on the weekend. Sure, the credulous party faithful were willing to believe him as he continued to lay the blame for the state of the economy on what Labour did, or didn't do three, four or six years ago – but at some point, the man has to look in the mirror. Last year, things were going to be better in 2025. Now, good times are allegedly waiting just around the corner. Maybe next year? Maybe 2027, if you re-elect him? Luxon's core claim that Labour left the economy in a terrible, awful no good mess somehow evaded the notice of all of the international credit rating agencies, who were still giving Labour top marks for managing the economy here and also here and here as well on the eve of the 2023 election. Moreover, the subsequent inflationary bubble/cost of living crisis was the direct result of the subsidies and industry supports that got us through the pandemic, and that corporate NZ was demanding at the time should be bigger, and should be kept in place for longer. Luxon is very keen for all of that to go down the memory hole. But in passing...I wonder which Covid wage subsidies and which sectoral suppport schemes for business does Luxon think were mistakes that he would not have made? On balance, the surge of inflation seems to have been a relatively small price to pay for keeping so many firms afloat, and for saving so many jobs and household incomes. One shudders to think what would have happened if a National government had been in power during Covid. But more to the current point, the coalition government has since done a worse job than any other Western democracy of enabling the economy to recover from its post-Covid inflationary bubble. By dint of its cutbacks to government-led activity, National has prolonged and deepened the recession. Thanks to the random job losses that National has imposed, retailers are suffering and households – made fearful of losing their incomes - continue to be gunshy about spending. There is no end in sight. Where's the beef? Reportedly, us having 15% tariffs slapped on our exports to the US came as a total shock. If so, Finance Minister Nicola Willis and Trade Minister Todd McClay must have been asleep at the wheel. The simple truth is that we run a trade surplus with the US. Meaning: we sell them more than they buy from us. The Aussies by contrast, are running a trade deficit with the US, and have been duly rewarded by Trump for doing so. Looking at those two sets of contrasting figures should have warned our government to expect to be treated differently. In Trumpland, any country that runs a trade surplus with the US is a Bad Country that is ripping the US off. How 'bad' have we been? Pretty bad, in Trumpian terms : In May 2025, United States exported $319M and imported $528M from New Zealand, resulting in a negative trade balance of $209M. Between May 2024 and May 2025 the exports of United States to New Zealand decreased by $85.6M (21.1%) from $405M to $319M, while imports increased by $30M (6.03%) from $498M to $528M. In a sense then, New Zealand is a victim of its own success. Yes, we are now operating in the US market at a 5% competitive disadvantage to Australia. But the new tariff situation isn't entirely bad news for our beef exporters. Brazil has long been a major supplier to US fast food restaurant chains of ground beef – the US is Brazil's second biggest market for beef - but it has just been hit with 50% tariffs, mainly because Trump disapproves of how the Brazilian courts are prosecuting his old pal, Jail Bolsonaro. Australia will have a 5% head start, but there may also be some potential for New Zealand beef exporters to capitalise on Brazil's misfortune. The risk is that Brazilian beef will be sold at a bargain price to other countries, depressing global prices. In the meantime, our emissaries are now heading to Washington to plead our case, but with very few negotiating cards to play. The fatuous free market zeal we displayed in the 1980s and 1990s is once more coming back to bite us. Because New Zealand unilaterally removed its own tariff barriers back then, we have little left to bargain with in our trade talks with other countries. Why should they offer us anything, when we've already given them everything they might want for free? Out of Balance New Zealand makes much of its diplomatic balancing act between China on trade, and the US on defence and security. Yet as the current Trump tariff episode shows, our dependency on the US for trade (and for foreign investment funds) is highly significant. The NZ/US Council executive director Fiona Cooper pointed this out in a speech she gave in March.. 'Over the last 12 months, the US has overtaken Australia to become New Zealand's second largest export market after US is New Zealand's largest market for beef and wine, no doubt including a lot of fine Marlborough wine. It is an important market for many other products including other meat, dairy, honey, casein, fish, fruit and wood, as well as mechanical appliances, medical instruments, electrical machinery, pharmaceuticals and aluminium and steel products. In addition, she noted, ' The US is also a fast-growing market for New Zealand services exports, which were worth nearly $7 billion in the year to September 2024. The US is now our largest services market, taking nearly a quarter our total services exports.' (Those services dollars are being driven upwards by the numbers of US tourists coming to New Zealand. We're mounting ad campaigns to attract more of them.) All signs therefore, would suggest that our booming goods and services trade with the US is badly unbalanced, at least on the terms Donald Trump uses to view the world. Chances are, we will probably continue to run a trade surplus with the US – and will remain in Trump's bad books - until Air New Zealand buys a few more planes from Boeing and/or until via AUKUS, we start buying large amounts of expensive weaponry from the likes of Lockheed Martin, Raytheon and General Dynamics. That would be a bad idea for other reasons. Footnote One: Some of Trump's headline tariff rates are highly deceptive. The 35% headline tariff rate on Canada for instance not only exempts some of the stuff the US wants and needs (eg Canada's energy exports) but also much of the trade carried out under the CUSMA trade agreement (between Canada, the US and Mexico) that's due to be reviewed next year. In the meantime, Canada's real tariff barriers with the US are not 35%, but average out in single digits. In other words Canada too, has some real trade advantages over us in US markets. Footnote Two: Brazil has far more reason to feel aggrieved than we do. After all, it runs a trade deficit with the US - normally treated by Trump as a sign of virtue – but has been hit by a 50% tariff because of its 'persecution' of Bolsonaro. Yet as with Canada, Brazil's headline rate is rife with exemptions on stuff that the US wants and needs, including fresh orange juice. Overall 45% of Brazil's exports will be exempt, but the rate will still hit two of Brazil's main exports to the US very hard: beef and coffee. As mentioned above it is hard to predict what the impact will be on global prices for beef and coffee, as Brazil seeks to find other markets. Increasingly, Brazil's alternative market for its oil, soybean and beef exports is China. Already only 12% of Brazil's exports get shipped to the US, while 28% is being sold to China. Ironically, Trump's mood swings on tariffs are serving to make China look like the sensible adult in the room on global trade, and the preferred buyer of first and last resort. In itself that's an added reason for us not to join an AUKUS military pact targeted at China. Crafting our diplomatic efforts in order to earn imaginary brownie points in Washington looks like being an increasingly futile exercise. Footnote Three: All of the evidence on US trade exemptions suggests that New Zealand's best fallback negotiating strategy with the Trump administration – if we can get in the door at all – would be to argue for an exemption, probably for beef exports. We seem unlikely to get relief from the headline 15% rate, given that this seems to be the bottom line penalty for every country running a trade surplus with the US. Footnote Four One of the stranger items on the Trump tariff enemies list has been the harsh 20% rate levied on Taiwan. This comes amid signs that US support for Taiwan may be waning. It seems only yesterday that the US was giving every sign that any Chinese aggression against Taiwan would be met with the full force of US military now, maybe not so much. Taiwan is suddenly being pushed out at arms' length. For example: on top of those 20% tariffs, there has been this: Washington blocked Taiwan Premier Lai Ching Te's request to visit New York next week during a planned overseas trip to Taipei's Latin American allies. The Trump administration is also considering a downgrade to bilateral defence talks, which it postponed in June. The reason for the sudden cooling? Well, Premier Lai has been talking about leading his faction-ridden minority government into declaring independence from China, a gambit likely to trigger an even more furious response than usual from China. Parts of what China sees as its sovereign territory cannot be allowed to secede at will. That's the kindest interpretation of the US switcheroo, as an attempt to rein in Premier Lai. It is also a useful reminder that the US is an unreliable defence ally, and that its priorities and commitments in the Asia-Pacific region can change at a moment's notice according to its own domestic perceptions and priorities. In sum that's yet another good reason for New Zealand not to join AUKUS, a nuclear pact that would be under the effective operational command of the Americans.
Economic Times
30-07-2025
- Business
- Economic Times
Trumpland: What if the world turned US trade war back on America?
AI image Tariff' Trump has announced a 25% levy on Indian goods entering US starting tomorrow, coupled with a penalty for India's continued oil and defence purchases from Russia. Prefixing his announcement on Truth Social with 'while India is a friend', the US president has sought to punish India for asserting sovereign choices in trade and foreign policy. With friends like this, who needs friends? The irony is poetic: the self-declared custodian of free trade is now its most protectionist offender. Economics is built around the principle of movement: of goods, capital, labour and data. This isn't just ideology, it's the physics of prosperity. Yet, the US, once the world's most vocal advocate for free markets, is, in the form of Trumpland, its most disruptive force. From semiconductor export bans and weaponised sanctions to unilateral tariffs and extraterritorial dictates, Trumpland has turned the global economy into a minefield of exceptions, exclusions and coercion. So, here's the question that can now be asked aloud: what if the rest of the world sanctioned the US? What if countries collectively paused the flow of rare earths, APIs, industrial machinery, telecom infrastructure, even data? Could the US survive the very conditions it imposes on others? In 2024, US goods imports hit a record $3.3 tn, while exports reached $2.1 tn, pushing goods trade deficit to $1.2 tn, a 14% increase from the previous year. Even after including services like finance and travel, total trade deficit stood at $918 bn, up 17%, the second highest on record. Trade gap with China grew to $295 bn, a clear sign of ongoing reliance. Beyond China, the US remains critically dependent on imports for over 221 essential goods, including microchips and battery components, with foreign sourcing levels between 90% and 100%. China supplies 70% of rare earths, and dominates the global graphite supply chain. Other key materials like lithium and cobalt are also heavily imported from countries like Chile, Canada and Argentina. In total, just four trading partners — China, the EU, Mexico and Canada — each account for more than 10% of US import value. These are not discretionary purchases, but foundational components of American industry. The US is not merely part of global supply chains, but also structurally dependent on them, never mind all that talk of decoupling and University's Budget Lab assessed that the US' 2025 tariff surge has raised its average effective tariff rate to 22.5%, the highest since 1909. This policy shift has led to a 2.3% rise in consumer prices, costing the average household $3,800 annually. Lower-income families are hit hardest, with those in the second income decile losing $1,700 a GDP growth is expected to drop by 0.9 percentage points in 2025. Long-term output is projected to remain 0.6% smaller, a permanent loss of around $180 bn a year. Exports have declined by 18.1%. Prices for essentials have spiked, with apparel up 17%, food nearly 3% higher, and new cars costing an extra $4,000 on from protecting the economy, Trump tariffs are eroding household income, slowing growth and adversely affecting America's economic Walter Scheidel explains in his 2017 book, The Great Leveler, entrenched systems rarely reform themselves through negotiation alone. Meaningful redistribution often follows rupture rather than consensus. So, what might rupture look like today? Imagine the world's major exporters including Europe, China, India, Asean and Latin America agreeing to a coordinated pause in shipments to the US. No semiconductors, no APIs, no telecom equipment. In a matter of weeks, American production lines would slow, inflation would surge, and financial markets would be rattled. It would serve as a powerful reminder that the US economy is not insulated by exceptionalism. It operates on the consent and cooperation of the rest of the world. This isn't about restoring balance. It's a call to deliberately hit the US economy where it hurts, to expose the double standards that define today's global order. In any functioning market, domestic or global, rules matter not only because they enable exchange but also because they constrain abuse. Participation in global trade is characterised by the principle of mutualism and benefits will flow only as long as responsibilities are this fundamental point, the US' economic bullying undermines not just the trust but the very ethos of the current global economic system. The world, India included, now faces a pivotal question. Should it continue to accommodate this exception, or begin to act as a collective? A coordinated stand by global exporters, in defence of systemic integrity, would affirm that globalisation is not the privilege of a single actor but the shared project of many. If the international order is to survive, it must demonstrate that no participant is above its rules. Trumpland may yet learn that the system the US helped create can continue to evolve without its dominance. And that the invisible hand, if constrained long enough, may simply withdraw its reach from the United States. (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of Elevate your knowledge and leadership skills at a cost cheaper than your daily tea. Regulators promote exchanges; can they stifle one? 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New European
02-06-2025
- Politics
- New European
Biden died and was replaced by a robot, claims Trump
Having initially called the news 'very sad', Trump last week told an Oval Office press conference that Biden was 'not a smart person, but a somewhat vicious person', adding: 'If you feel sorry for him, don't feel sorry for him, because he's vicious.' The president then took to his Truth Social platform to share a claim that Biden had been killed in 2020 and secretly replaced by a robotic clone. 'There is no #JoeBiden – executed in 2020,' the post read, going on to claim that the real Biden was replaced by 'clones doubles & robotic engineered soulless mindless entities' and that 'Democrats don't know the difference'. The claims were predictably amplified by his supporters online, with some pointing to slight differences in Biden's earlobes in different pictures, and others spotting the 'clue' of a funeral cannon salute being given at Arlington National Cemetery on the day of his inauguration. It's entirely possible you missed this story as many media ignored it – although younger readers may be interested to know a sitting president claiming his predecessor had been replaced with a robot while in office would once have been quite big news. It's just another day in Trumpland, though!
The Guardian
03-05-2025
- Politics
- The Guardian
Germany hits back at Marco Rubio after he panned labeling of AfD as ‘extremist'
Germany's foreign ministry has hit back at the US secretary of state, Marco Rubio, following his criticism of Germany's decision to label the far-right Alternative für Deutschland party as a 'confirmed rightwing extremist group'. On Thursday, Rubio took to X and wrote: 'Germany just gave its spy agency new powers to surveil the opposition. That's not democracy – it's tyranny in disguise. What is truly extremist is not the popular AfD – which took second in the recent election – but rather the establishment's deadly open border immigration policies that the AfD opposes.' Rubio went on to say: 'Germany should reverse course.' In a response on X, the German foreign ministry pushed back against the US secretary of state, saying: 'This is democracy. This decision is the result of a thorough & independent investigation to protect our Constitution & the rule of law. It is independent courts that will have the final say. We have learnt from our history that rightwing extremism needs to be stopped.' Germany's response to Rubio comes after its domestic intelligence service, the Federal Office for the Protection of the Constitution (BfV), designated the AfD as a 'confirmed rightwing extremist' force on Friday. The BfV's decision marks a step up from its previous designation of the country's anti-immigrant, pro-Kremlin and largest opposition party as a 'suspected' threat to Germany's democratic order. According to the BfV, the AfD's xenophobic stances based on an 'ethnic-ancestry-based understanding' of German identity are 'incompatible with the free democratic basic order' as indicated by the country's constitution. The spy agency added that the AfD 'aims to exclude certain population groups from equal participation in society, to subject them to unconstitutional unequal treatment and thus to assign them a legally devalued status'. It also said: 'This exclusionary understanding of the people is the starting point and ideological basis for ongoing agitation against certain individuals or groups of people, through which they are defamed and despised indiscriminately and irrational fears and rejection are stirred up.' During February's general election in Germany which was rocked by extensive US interference including public votes of confidence by staunch AfD supporters such as Elon Musk and JD Vance, the AfD amassed approximately 21% of the vote, finishing second. The far-right party's rise to popularity in Germany has come as a result of a broader wave of growing rightwing extremism across Europe. Sign up to This Week in Trumpland A deep dive into the policies, controversies and oddities surrounding the Trump administration after newsletter promotion At the same time, public figures in the US have openly made remarks or gestures that are sympathetic to nazism, despite the Trump administration's sweeping crackdown on antisemitism across the country – a move which has been called into question by higher education institutions and Jewish senators who accuse Trump of targeting free speech. Musk, who had been given the designation of a 'special government employee' by the Trump administration, made back-to-back apparent fascist salutes during the president's inauguration rally earlier this year. Last month, during a Capitol Hill hearing that sought to explore supposed government censorship under Joe Biden, Republican representative Keith Self quoted Joseph Goebbels, the Nazi propaganda minister under Adolf Hitler. 'A direct quote from Joseph Goebbels: 'It is the absolute right of the state to supervise the formation of public opinion,' and I think that may be what we're discussing here,' he said.
The Guardian
15-04-2025
- Politics
- The Guardian
Senator Chuck Grassley grilled at Iowa town hall over ‘shameful' Trump policies
The Republican senator Chuck Grassley struggled to control a town hall meeting on Tuesday as constituents erupted in anger over border security policies and the Trump administration's aggressive deportation practices. The 91-year-old Republican lawmaker from Iowa is the latest elected official to get grilled by a packed room of constituents. Attendees in the Republican state were concerned about the treatment of asylum seekers stemming from the president's approach to immigration enforcement. 'I believe very strongly in my Christian faith. I preach on Sundays,' said one attendee, 'Turning away people who have come here for asylum is one of the most shameful things we are doing right here.' The attendee pressed Grassley on whether he would take action to ensure the United States better follows international law and upholds 'the ideals of our country to be a place of hope for others'. Grassley responded that he would 'welcome refugees, I would welcome people seeking asylum'. On Tuesday morning, Trump had posted on Truth Social that border crossings hit an all-time low in March. Tensions escalated further when another constituent accused Trump of ignoring the supreme court order regarding Kilmar Armando Ábrego García. Ábrego's deportation to El Salvador despite supreme court intervention has become a rallying point for immigration advocates, who cite it as evidence of the administration's willingness to flout judicial authority. In the White House press conference on Tuesday, the press secretary, Karoline Leavitt, called Ábrego a 'human trafficker and gang member'. 'The president doesn't care,' one attendee at Grassley's town hall shouted. 'He's got an order from the supreme court and he's just said, 'No, screw it.'' Multiple attendees reminded Grassley, who has held his Senate seat since 1981, of his constitutional oath of office, with one asking whether the senator was acting upon that oath. The crowd grew increasingly frustrated as Grassley attempted to explain his position. Sign up to This Week in Trumpland A deep dive into the policies, controversies and oddities surrounding the Trump administration after newsletter promotion 'I'm trying to recapture the constitutional authority of article 1, section 8,' Grassley responded, referencing a bipartisan bill he introduced aimed at addressing what he called 'mistakes that Democratic Congress has made in 1963'. Grassley's confrontational town hall comes as many Republican lawmakers have largely abandoned the practice of holding in-person constituent meetings during their congressional recess. The retreat from public forums follows other heated exchanges where Republican lawmakers faced sometimes abrasive criticism over issues like proposed budget cuts to Medicare and Medicaid and what they see as the erosion of constitutional checks and balances. While Grassley continues his 45th annual 99-county tour of Iowa, only a handful of Republicans, including the representatives Marjorie Taylor Greene and Byron Donalds, have publicly announced plans for similar events.
