Latest news with #pre-Trump
Irish Examiner
a day ago
- Business
- Irish Examiner
David McNamara: All-out trade war averted but ripples will be felt
The weekend breakthrough in trade talks between the EU and US provided a fillip to markets early in the trading week, but the details of the agreement are scant, and key areas are yet to be determined - notably pharmaceuticals. A baseline 15% tariff has been agreed on EU exports to the US, with no additional tariffs from the EU on US products. With pre-Trump tariffs of around 4% to 5% on the EU, reports suggest the 15% will be inclusive of this, meaning a net additional 10% versus the January 2025 baseline. Higher tariffs of 25% will remain on steel and aluminium for now, but autos tariffs will be reduced from 25% to 15%, which will be something of a reprieve for the large car industry in central Europe. European Commission president Ursula von der Leyen also said there would be no tariffs from either side on aircraft and aircraft parts, certain chemicals, certain generic drugs, semiconductor equipment, some agricultural products, natural resources and critical raw materials. In return, the EU has agreed to purchase more US energy and military equipment, and potentially lower its tariffs in some areas. There are conflicting reports on pharmaceuticals, with some suggesting 15% would apply immediately, while others suggest a carve out below that rate for some areas. The final landing zone for pharmaceuticals and other strategic sectors such as semiconductors is likely to become clearer when the US government concludes 'Section 232' trade investigations into these sectors in the coming weeks. For now, markets have welcomed the certainty provided by the deal, with stocks rising sharply on Monday. While details are scant, the key tail risk of an all-out trade war is now off the table. Nonetheless, the EU has conceded significant ground from its initial position of 'zero-for-zero' tariffs and a later offer of 10%. If sustained across most sectors, a 15% tariff would bring US duties to their highest level since the 1930s and would likely damage trade and GDP growth in the export-orientated EU and could also yield a 'stagflationary' shock for the US. For Ireland, the deal is less damaging than many feared post-'Liberation Day'. Alongside the conclusion of the 'big beautiful' US tax bill, which retains existing provisions which underpin the presence of US FDI intellectual property in Ireland, the certainty might be cautiously welcomed by some large exporters. However, in lower margin sectors, where products might be more readily substitutable, the new higher 15% rate could be a death-knell for some transatlantic markets. It could be several months for the final deal to be hammered out, and the impact on the economy will play out over an even longer period in the years ahead. David McNamara is senior economist with AIB
&w=3840&q=100)
Business Standard
2 days ago
- Business
- Business Standard
Explained: What is the new 15% US-EU tariff deal and what does it cover?
US President Donald Trump and European Commission President Ursula von der Leyen on Sunday, July 27, announced a wide-ranging trade agreement that imposes a 15 per cent tariff on most European imports into the US. The deal, which was finalised during a brief meeting at Trump's Turnberry golf resort in Scotland, averted the looming threat of a 30 per cent tariff that was set to take effect on August 1. While the headline tariff rate is fixed at 15 per cent, many of the agreement's finer details are still unclear. The deal includes zero tariffs on select 'strategic goods' such as aircraft and aircraft parts, certain chemicals, semiconductor equipment, some agricultural products, and critical raw materials. However, pharmaceuticals, steel, and some farm goods remain outside the scope of this agreement. What is not included in the deal? While the agreement removes immediate tariff threats, several issues remain unresolved. Trump confirmed that the existing 50 per cent US tariff on imported steel will stay in place. Talks will continue on setting steel import quotas and reducing overcapacity in the global market. Pharmaceuticals were not included in this agreement. Von der Leyen clarified that those discussions are ongoing, separate from Sunday's deal. Tariffs on some EU agricultural products also remain unchanged, but with no clear indication of which items are excluded. What impact will the agreement have? The 15 per cent tariff is a significant increase from the pre-Trump average US tariff of about 1 per cent on European goods and above the 10 per cent baseline tariff applied during negotiations. For European exporters, the impact could be considerable as many companies will face the difficult choice of either passing the cost on to US consumers or absorbing losses. The earlier 10 per cent tariff was already enough to prompt the European Commission to slash its growth forecast from 1.3 per cent to 0.9 per cent. Now, with 15 per cent, German industry leaders warn of 'immense negative effects' on export-reliant sectors. Von der Leyen defended the deal, calling it 'the best we could do' and noting that it secures continued access to the US market and brings a degree of stability. How are different sectors reacting, especially carmakers? The car industry, which was gearing for a 30 per cent tariff, sees the 15 per cent rate as a relief. Von der Leyen pointed out that the new rate is significantly lower than the current 27.5 per cent tariff on cars from all countries — which includes Trump's 25 per cent tariff and the pre-existing 2.5 per cent US auto tariff. Still, European automakers remain under pressure. Volkswagen revealed it had already lost $1.5 billion in profits in the first half of the year due to higher US tariffs. Mercedes-Benz, which produces a significant share of its US-sold vehicles in Alabama, said price hikes are likely for future model years. What were the key issues dividing the two sides? Before Trump's presidency, US-EU tariffs were relatively low. According to the Brussels-based Bruegel think tank, the US averaged a 1.47 per cent tariff on European goods, while the EU imposed 1.35 per cent on American products, Associated Press reported. Trump frequently criticised the $235 billion US merchandise trade deficit with the EU, calling the European market unfair — particularly in the automotive sector. However, the EU argues that the US enjoys a substantial surplus in services like cloud computing, travel, and financial services, which helps offset the imbalance. Despite Trump's stance that the EU 'was formed to screw the United States', both sides have recognised the need to preserve their trading relationship. With $2 trillion in annual commerce, the US and EU form the world's largest bilateral trading bloc. How did the deal come together? The last-minute breakthrough came just days before the US deadline to impose new tariffs. Trump and von der Leyen held brief talks at Trump's golf resort in Scotland, joined by top EU trade officials. Commerce Secretary Howard Lutnick said the August 1 deadline was firm. 'No extensions, no more grace periods,' he said. Yet he said that Trump remained open to future dialogue. The EU had prepared its own list of retaliatory tariffs targeting hundreds of US goods, including beef, auto parts, beer, and even Boeing aircraft. Without a deal, everything from French cheese to German electronics could have become more expensive for American consumers. What are the concerns going forward? While the agreement avoided an immediate trade war, analysts caution that the deal remains vague in parts. 'There is nothing on paper, yet,' said ING's global chief of macro Carsten Brzeski. He warned that the lack of formal documentation makes enforcement and interpretation difficult. German Chancellor Friedrich Merz praised the outcome for preserving 'core interests' but expressed disappointment that deeper tariff relief wasn't achieved. (With agency inputs)
Irish Independent
2 days ago
- Business
- Irish Independent
Donal O'Donovan: Trade deal is big win for Donald Trump, bad loss for Europeans and a disaster for the EU
Ursula von der Leyen's cowed description of the deal struck with Donald Trump as 'a rebalancing' marks the scale of her capitulation – explicitly buying the US line that there was something off about pre-Trump trade between the US and EU.
The Hill
6 days ago
- Politics
- The Hill
Democrats can rebuild government by learning from how Trump has destroyed it
We know the tragic effects of President Trump's dismantling of the federal government. Social Security service delivery are in crisis. Calls to the Federal Emergency Management Agency in the wake of disaster go unanswered. Rural hospitals brace for a loss of federal support. And now congressional Republicans are surrendering the power of the purse to further hobble core government services by choking off funding. But the truth is, Trump alone didn't break the federal government. He is putting the devastating capstone on a decades-long conservative project of undermining its capacity to function: underfunding agencies, outsourcing expertise, layering on procedural hurdles, stacking courts with partisan allies, and eroding public trust. Long before Trump took office, the result was a government that couldn't move quickly, deliver boldly or meet the needs of the people it was supposed to serve. And when the government is unable to visibly respond to people's discontent and aspirations within the timeframe of an electoral mandate, the legitimacy of democracy itself erodes. If Democrats truly believe in the power of government to improve people's lives, they should be cautious about reverting to pre-Trump institutions. Our time in the Biden-Harris administration taught us that the federal government wasn't meeting the needs of middle- or working-class people long before the 2024 election. What was left of it has now been intentionally sabotaged. If we want to implement a bold policy agenda in the future — one that truly creates agency, power and opportunity for people who don't have it — we have to start planning now to build the basic infrastructure for a government that's much more responsive to and resonant with ordinary Americans, not the monied few. For too long, Democrats have been stuck in a vicious cycle of playing catch-up in a game with existential stakes. Phase one: Republicans dismantle government programs and services and trigger economic crises through their laissez-faire approach to governance. Phase two: Democrats retake power, and then scramble to steer a hobbled system back to the status quo. Phase three: Democrats fail to deliver the visible change the electorate craves, Republicans retake power, and the cycle repeats. What has to change? We need to confront a hard truth: Despite good intentions and tireless efforts from appointees and civil servants alike, the old tools and norms have not worked. Administrative rulemaking has been too slow, fragile, and captured by well-resourced industries to meaningfully serve the public interest. Major policies passed with fanfare took four or more years to show results — long after voters were asked to judge them. Meanwhile, activist courts stacked by the right delayed or dismantled even modest reforms. Agencies were afraid to antagonize the powerful industries they were supposed to oversee, or to take an investment risk and face public failure. Enforcement against corporate lawbreaking was underfunded and slow. Outsourcing of core government functions made private contractors rich even when their performance was shoddy. And far too often, the government was a distant, impenetrable behemoth that piled paperwork on Americans, instead of proactively listening to them to understand their needs and deliver frictionless services in response. We can't win back faith in government with policies that are invisible, delayed or drowned in process. We need a new playbook — one that matches the urgency of the moment and the acuteness of people's needs. One that learns, paradoxically, from the relentlessness of Trump and his allies. What they've demonstrated is that the rules and norms constraining government action aren't fixed laws of nature. They're conventions — and they can be changed. If there's no political cost for ignoring them in the service of corporate power and oligarchic corruption, there should be even less fear about changing them to make government work better for ordinary people. Democrats should take the lesson: Flip the risk profile. Go big or go home. That means reorganizing policymaking around speed, visibility and political resonance. It means building teams around outcome-driven missions — not statutes, institutional bias or risk-averse compliance. It means treating economic, legal, outreach and communications strategy as one integrated campaign, and working much more collaboratively with our state and local government partners and community-based organizations. It means starting work long before Day One with the understanding that we will need to simultaneously build and deliver: pre-drafting policies, mapping authorities, recruiting top-flight talent and identifying the signature priorities for each agency that will show up in people's lives within a single term. These are unified campaign-style operations, not bureaucratic ones. And it means breaking free from the norms that keep the government mired in caution. Abolish or radically retool obsolete veto gates, such as the Office of Information and Regulatory Affairs. Limit judicial meddling in economic policy choices made by political leaders accountable to the people, and refocus courts on protecting individual liberties. Make the government great to work for again, and repopulate it with technologists, statisticians, product managers, service designers, community organizers and movement lawyers. Clean out the procedural clutter that saps time and bandwidth. We've seen what gets in the way. Now it's time to start clearing it. Importantly, when we act, we must act boldly. During the last administration, the types of policies that resonated were the big, simple, universal ones: a cap on insulin prices, a ban on junk fees, an end to noncompetes, a free, easy way to file your taxes. These were policies designed to be tangible, memorable and swift — and they addressed economic frustrations that transcend partisan lines. That's not just good economics. It's good politics. It's good democracy. Policies must provide proof that the government can still work for ordinary people, not just large corporations or insiders. For too long, Democrats have tried to govern within a framework designed to thwart them and to protect entrenched interests. Trump simply ignored it. If we want to change that trajectory for government, we need to be just as fearless and bold in building a new framework as Republicans have been in destroying the old one. If Democrats want to lead, the party must demonstrate that the government can — and will — continue to change lives for the better. Let's stop trying to tinker with a broken machine. Let's start building one that actually works.
Politico
22-07-2025
- Business
- Politico
Republicans once said the free market should decide how the US uses energy. No more.
Addressing grid reliability is crucial for a Trump economic agenda that places a huge priority on growing artificial intelligence, which forecasters have said will require vast amounts of electricity. Trump administration officials contend that ending renewable power subsidies and reversing Biden's environmental rules will attract more AI investment by preventing retirement of coal and natural gas power plants. 'The need for power is scaling so fast that if President Trump hadn't been elected president, I think we would already be in trouble,' said Carla Sands, vice chair of the center for energy and environment at the Trump-aligned think tank America First Policy Institute. 'The American regulatory environment had become anti-production, anti-energy, anti-business, and this is changing under President Trump's brilliant leadership.' An energy and AI summit that Sen. David McCormick (R-Pa.) convened last week in Pittsburgh — which included an appearance by Trump — crystallized the emergence of the president's brand of industrial policy. The administration touted $90 billion in announcements for new AI investments from U.S. tech companies, investment houses and the 'hyperscalers' that build the data centers such as Google, CoreWeave, Blackstone and Brookfield Asset Management. 'The AI revolution will change the way the world works, and we cannot lose. The Trump administration will not let us lose,' Commerce Secretary Howard Lutnick said during the event. 'We need to do clean, beautiful coal. We need to do natural gas. We need to embrace nuclear. We need to embrace it all because we have the power to do it — and if we don't do it, we're fools.' But wind, solar and battery storage projects have been the United States' leading source of new power in recent years, while backlogs for new natural gas turbines, yearslong timelines to build nuclear power plants and the remote chances of greenlighting new coal-fired power plants have stunted growth of those sources. Solar, wind and batteries accounted for 93 percent of all new power added to the grid last year, according to the U.S. Energy Information Administration. People who identify themselves as traditional small government conservatives expressed wariness of some of Trump's moves. They say the party is using the same heavy-handed tactics to reward favorites for which they criticized Democrats. Republicans have even dialed it up a notch, they said. Republicans have cast aside the all-of-the-above mindset of the pre-Trump era, said Drew Bond, CEO of conservative climate organization C3 Solutions and an Energy Department adviser in the George W. Bush administration. Now, they preach a 'best of the above' mentality that invites subjective choice over the ebbs and flows of a free market, he said.
