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Wall Street Journal
4 days ago
- Business
- Wall Street Journal
How a Small Wine Importer Took On Trump's Tariffs
Victor Owen Schwartz was preparing linguine and clams for dinner Wednesday night when he spotted an email from his lawyers with some good news. 'I wasn't shocked,' said Schwartz. 'I thought we were right, but I know that's not always the way the world works.' Schwartz, a small wine importer and distributor, is the lead plaintiff in a lawsuit that was filed in April by the Liberty Justice Center, a libertarian legal group, to challenge President Trump's tariffs. The email told him that a federal court had ruled in his favor and invalidated almost all of Trump's tariffs. 'This is really a win for small business in America and the right of free trade,' Schwartz said. The 66-year-old businessman is the unlikely face of tariff resistance. He is one of five small businesses that agreed to take on the U.S. government. Big corporations, powerful CEOs and trade groups didn't mount legal challenges to the Trump administration's tariffs. An appeals court Thursday granted a government request to pause the decision while it considers an appeal. Other tariff challenges, including one by a group of states, have been filed, but Schwartz's case is front and center. An unhappy banker, Schwartz started his business, VOS Selections, 39 years ago after working for five years as a commercial lender. His New York City company imports wines, sakes and spirits from small producers in 16 countries. European wines account for the bulk of sales. He was introduced to Ilya Somin, a George Mason University constitutional law professor and co-counsel in the case, by a family member who had been a student of Somin's. The professor had written a February post on the blog Volokh Conspiracy calling the tariffs unconstitutional. Lawyers at the Liberty Justice Center had reached out to him to help bring a case. 'We are importers. We are canaries in the coal mine, on the front line of this issue,' said Schwartz, who started as a two-person operation and now has about 20 employees. His firm sells to restaurants, small liquor stores and big chains such as Total Wine. Schwartz said he was nervous about the political repercussions of challenging the Trump administration but decided to go ahead anyway. 'If I didn't do it, who is going to do it?' he said. 'It was not a political decision. It was a business decision.' The Liberty Justice Center, which is based in Texas, has brought more than 135 lawsuits since it launched in 2011. The libertarian, nonprofit public-interest litigation law firm previously was best known for a case that reached the Supreme Court in 2018 that allowed government employees to opt out of union dues. The group initially spoke with about a dozen small-business owners about joining the tariffs lawsuit but had little success finding potential plaintiffs. 'A lot of people we contacted were hesitant to challenge the administration,' said Jeffrey Schwab, senior counsel at the Liberty Justice Center and lead counsel on the tariff lawsuit. In early April, Somin wrote in a post that he and the Liberty Justice Center were looking for plaintiffs for a lawsuit challenging the tariffs that they would represent on a pro bono basis. 'I think the ideal client would be a privately held company affected by the tariffs that imports materials directly from one of the countries subject to the tariffs,' Somin wrote. 'The company doesn't have to be a small business, but since I suspect many small businesses will be disproportionately harmed by the tariffs, that may be an ideal plaintiff.' The post generated a lot of interest. The group spoke with about three dozen businesses before settling on at least 10 they liked. Some decided not to participate. Somin said being counsel on a case was new for him, as he mostly spends his time writing amicus briefs and doesn't litigate cases. However, the libertarian scholar did represent himself about 30 years ago at a hearing in front of a Massachusetts state board to fight points being added to his auto insurance. 'I was successful in that case,' he said. Along with VOS, four other small businesses joined the case: a fishing tackle retailer in Pennsylvania, a women's cycling apparel brand based in Vermont, a Utah manufacturer of plastic pipe, and MicroKits, a Virginia-based maker of educational electronic kits. The five plaintiffs, collectively, import goods from more than three dozen countries, Schwab said, and represented a variety of industries. VOS was selected as the lead plaintiff in part because 'wine illustrated why the broad-based tariffs don't make any sense,' Schwab said. David Levi, the owner of MicroKits, which sells do-it-yourself electronics kits for students and hobbyists, gets about 60% of his parts from China. 'Either you can't find them in the U.S., or they are five to 10 times more expensive,' he said. Levi started the business in 2020 and has one part-time employee. When the tariffs hit, he stopped placing parts orders. 'I was petrified,' he said. 'The meaning of petrified is you are so scared, you don't take any action.' With fewer parts on hand, he had to slow production and cut his part-time employee to 15 hours a week from 25. He also raised prices. A kit that produces sounds now sells for $49.95, up from $39.95 before the tariffs. VOS also had to review each of its products to quantify the tariff impacts. Schwartz and his daughter Chloë Syrah Schwartz, who helps run the business, decided to put off purchases of some new items and slower-selling products. Tariffs are particularly painful, Schwartz said, because they must be paid when the goods arrive in the U.S., not when they are sold. The company has paid about $20,000 in new tariff costs this year. 'The simple word is contraction,' said Schwartz. 'We have to buy less. We have to buy more carefully. We can't take the same risks we normally would.' Write to Ruth Simon at and James Fanelli at
National Post
5 days ago
- Business
- National Post
GDP could grow by $70B if Quebec removes trade barriers: report
OTTAWA – The Quebec government could boost the Canadian economy by approximately $69.9 billion if it removes trade barriers with the rest of the country, a think tank in the province estimates. Article content Article content According to a new study by the Montreal Economic Institute (MEI), the signing of an agreement between Quebec and Ontario alone would increase Canada's GDP by approximately $32.2 billion. Article content 'Premier François Legault should follow Nova Scotia Premier Tim Houston's approach and adopt mutual recognition laws with the rest of the country,' said Trevor Tombe, a professor of economics at the University of Calgary and senior fellow at the MEI. Article content Article content The province will accept, without testing or additional fees, any product approved for use in the other province, even if it does not meet local standards. The law also applies to licensed services and professionals. Article content Ontario, New Brunswick and Prince Edward Island have also joined the party, with measures to reciprocate Nova Scotia and increase trade. Article content 'It's one of the surest and lowest-cost ways for provincial governments to unleash Canadian productivity growth,' said Tombe. Article content So far, all these measures are leading the way to internal free trade zones with the potential to boost the country's economy substantially, according to MEI. Article content Article content For example, Ontario and Nova Scotia alone could boost the Canadian economy by nearly $4.1 billion. Article content However, all eyes are on Quebec's next move because of its numerous regulations. Article content The office of Quebec's Minister Delegate for the Economy Christopher Skeete told National Post that the government intends on introducing a bill 'very soon.' Article content 'We should welcome the provinces' willingness to reduce interprovincial trade barriers. Quebec is working on its own, and we welcome the bills from other provinces,' said the minister's spokesperson Léa Fortin in a text message. Article content In the past, Skeete has said that Quebec 'is ambitiously committed to improving the local business environment.' But when it comes to reciprocal measures with Nova Scotia and other provinces, it's not clear if the province is ready to make that step.
Khaleej Times
6 days ago
- Business
- Khaleej Times
End of free trade era? Tariff war could stall growth for 3 years, CFO warns
Free trade, as the world has known it, is over at least for the next three years, according to a global shipping company head. Ali Abouda, Group Chief Financial Officer (CFO) at Gulf Navigation Holding PJSC, also observed that the world is now in an "active trade war" and finance professionals must resort to frequent forecasting and scenario planning to navigate the uncertain times. "Budgeting has probably become a redundant exercise," said Abouda. "We are going through a very, very unpredictable time in terms of business environment. If there's no stability where you operate, then everything becomes quite difficult and challenging. Budgeting should be replaced by scenario forecast and I think a very frequent forecast should be the name of the game." Ali was in conversation with Khaleej Times Chief Content Officer Ted Kemp about the impact of US tariffs on finance professionals at the sixth edition of the New Age Finance and Accounting (NAFA) summit organized by Khaleej Times. The event saw CFOs, finance leaders, policymakers, and fintech innovators engage in dialogue on various topics including taxes, ESG, and reskilling the workforce. How does Section 301 impact trade? One of the topics of discussion during the conversation was Section 301. Kemp questioned how the section of the Trade Act of 1974, which targets Chinese ships, would impact trade. Abouda explained that 90 per cent of global trade was accounted for by shipping - a field dominated by China. "The US took a decision to keep the brain in the US and move the muscles elsewhere. Section 301 targets Chinese-built, owned, or operated vessels calling at US ports, imposing penalties of $500,000 to $1 million per call in addition to the tariffs. "The resolution is expected to be effective October 4, and if this goes through, I think there will be a structural change in the whole supply chain. China, in one way or another, control about 60 percent of the shipping, either through building or through financing or operating or resources," he said. Unclear directives from US Abouda added that while the Trump administration was agile in decision-making, it lacked clarity. "If the US wants to build more ships, that's all good, except that it isn't something that's going to happen quickly," he said. "I don't know what's the thought process behind it." He gave the example of how US President Donald Trump encouraged more American companies to drill oil, with his 'drill, baby, drill' slogan. "That's practically not possible, because the US doesn't have the capacity today to start increasing production by 3 or 4 million barrels immediately," he said. "That needs a lot of regulations to be in place and a lot of investments, which the US is not ready for. If I was one of the leaders of those companies, I would think twice. If you go with the mandates of an administration that has three years left, maybe the next administration will have a totally different view," Abouda added. He said that Trump's constant shift in tariff policies was also damaging to the industry. "The most recent example is, he imposed a 50 percent tariff on Europe and two days later, it was pushed to July 9," he said. "So, he's creating an environment which is very difficult to do business in."
The Guardian
11-05-2025
- Business
- The Guardian
Trump will destroy world trade, but democracies can defend themselves – and each other
The postwar global economic order, with the United States at its centre, has created more prosperity than any other period in human history. Yet as Donald Trump takes a sledgehammer to that economic order, America's democratic allies face a choice. We can accept the new cost of doing business with the US. We can follow the US down a path of mutually assured economic destruction with an ever-escalating trade war. Or we can find new avenues to keep free trade alive. My proposition? I believe we need a new platform for economic cooperation between the world's seven leading democracies. Call it the 'Democratic 7', or 'D7'. The EU, the UK, Canada, Australia, New Zealand, Japan, and South Korea represent roughly 25% of global GDP and account for about 35% of global trade volume. Together, these democracies can help to shield each other from the threats of economic nationalism and coercion – while also championing democracy, the rule of law, and market economics. The building blocks for this are already in place. The D7 would draw on an existing web of bilateral and regional trade agreements and could serve as an incentive to sign new ones. Already, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, otherwise known as the CPTPP, includes Canada, Japan, Australia, New Zealand and the UK. The EU maintains comprehensive agreements with Japan, South Korea and Canada. An outstanding agreement between the EU and Australia could be put back on track, and the UK chancellor, Rachel Reeves, recently stressed an improvement in the UK-EU trading relationship as 'imperative'. The cornerstone of a D7 economic alliance would be the economic equivalent of Nato's foundational principle, article 5, which holds that an attack on one is an attack on all. When economic powers threaten critical supply chains, engage in economic blackmail, or use access to their markets as leverage, they're counting on isolating vulnerable countries. After Canada honoured its extradition treaty with the US and detained a Huawei executive, for example, Canadian exports of pork and canola were banned from China. Australia's trade with its Pacific neighbour was frozen after Canberra suggested an inquiry into the origins of the Covid pandemic, and South Korean companies have paid the price for decisions made in Seoul that displeased Beijing. The D7's article 5 would ensure that coercion against one D7 member triggers an immediate, proportional response from all. This would fundamentally alter the calculus of those who wield their economic might as a weapon. The D7's mandate could also extend beyond defensive measures. It could create new frameworks for secure supply chains in critical sectors like semiconductors, rare earth minerals, medical supplies and green technologies. When one member faces shortages, others could provide priority access. Joint investment in production could ensure resilience against future disruptions of the kind we saw during the pandemic, and following Russia's illegal invasion of Ukraine. Together, D7 members could build a coherent, streamlined trading zone: reducing tariffs, removing bureaucratic hurdles, and establishing new standards based on shared values. Doing so would enhance our collective negotiating power when dealing with the US and China. When setting collective standards on emerging technologies like AI, for example, a D7's collective economic weight would help prevent global rules being dictated by autocrats or tech oligarchs. But no alliance is made stronger by becoming a closed club. While seven could serve as a starting point, the door should remain open to those who share these democratic values and are willing to support rules-based trade and prevent economic coercion, be they from Asia, Africa, Latin America, or elsewhere. True, a D7 would be an undoubtedly complex undertaking. Any number of politicians and vested interests could raise concerns about agricultural policies or regulatory approaches. Europe can seldom find unanimity, and there is also the fact of Brexit to contend with. But the global economic order that has benefited the world's democracies is today facing an existential threat. If this order continues to fragment, democracies will be left at the whims of Trump and Xi Jinping. That's why democracies need to stand together. Even while we grapple with this painful new reality, we must not forget: we still maintain the power to shape it. Anders Fogh Rasmussen was Nato secretary general from 2009-2014 and prime minister of Denmark from 2001-2009
Daily Mail
06-05-2025
- Business
- Daily Mail
Britain signs £25.5billion India free trade deal that could cut the cost of clothes, shoes and food for consumers and boost exports of booze and cars
Britain has agreed a £25.5billion free trade deal with India that could cut the cost of high street products for UK consumers. An agreement hammered out with Delhi will see the UK lower tariffs on clothes, shoes and food from the subcontinent, in exchange for reciprocal cuts for products including whisky and cars. However questions remain over what agreement has been made on visas for Indian nationals. This was a key sticking point that held up talks under the previous Conservative Government and Labour. Business and Trade Secretary, Jonathan Reynolds welcomed Indian Minister of Commerce and Industry, Piyush Goyal to London for trade talks this week to seal the deal. Prime Minister Keir Starmer said the deal would 'grow the economy and deliver for British people and business'. India's Prime Minister Narendra Modi said his country had concluded an 'ambitious and mutually beneficial' free trade agreement. In a post on X, he said: 'Delighted to speak with my friend PM Keir Starmer. In a historic milestone, India and the UK have successfully concluded an ambitious and mutually beneficial free trade agreement, along with a double contribution convention. 'These landmark agreements will further deepen our comprehensive strategic partnership, and catalyse trade, investment, growth, job creation, and innovation in both our economies. I look forward to welcoming PM Starmer to India soon.'
