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      ‘Shock to the system’: farmers hit by Trump’s tariffs and cuts say they need another bailout

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      Farmers across the United States say they could face financial ruin – unless there is a huge taxpayer-funded bailout to compensate for losses generated by Donald Trump’s sweeping cuts and chaotic tariffs.Small- and medium-sized farms were already struggling amid worsening climate shocks and volatile commodities markets, on top of being squeezed by large corporations that dominate the supply chain.In recent weeks, farmers in Texas and across the midwest have suffered millions of dollars of crop losses due to unprecedented heavy rainfall and flooding.The climate crisis-fueled extreme weather is compounded by the US president’s looming trade war and the administration targeting popular federal programs and staff, leaving farmers reeling and resigned to needing another bailout.“There’s a lot of uncertainty around and I hate to be used as a bargaining chip. I am definitely worried,” said Travis Johnson, who lost more than 1,000 acres of cotton, sorghum and corn after a year’s rain fell within 48 hours in the Rio Grande Valley (RGV) in southern Texas last month, turning parched fields into lakes.RGV farmers sell sorghum, wheat, corn and vegetables to Mexico among other crops, while buying fertilizer and equipment – and relying on Mexican farmhands for cheap labor. Mexico is the US’s largest trading partner, while China is the main buyer of American sorghum and cotton. All US products destined for China face a 125% tax thanks to Trump’s tariff war, and could cut farmers off from core markets.View image in fullscreen“I can see how some tariffs might help us compete with Mexico but are we really getting targeted by every other country or are we on the wrong side of this? We’ve already had two years of absolute disaster with falling prices and weather patterns … no farmer wants this but without a bailout this could be devastating and a lot more people could go under,” Johnson said.Rural counties rallied behind Trump in 2024, giving him a majority in all but 11 of the 444 farming-dependent counties last year, averaging 78% support, according to analysis by Investigate Midwest.Trump’s vote share rose among farming communities, despite his last trade war which required a $23bn taxpayer bailout for farmers in 2018-19.Yet anxiety is mounting among the agricultural base.First came widespread cuts to oversubscribed and chronically underfunded federal climate and conservation schemes designed to reduce costs and greenhouse gases, and improve yields and environmental health.Trump is also shuttering local food programs which provide farmers with stable domestic markets like public school districts and food banks, helping make farms more resilient to global economic shocks. The USAID, which purchased about $2bn every year in agricultural products particularly wheat, sorghum and lentils for humanitarian aid programs, has been dismantled.The loss in federal programs alone would have been tough to cope with, but then came the trade chaos. Trump’s tariff announcements began when most farmers already had spring crops in the ground – or at the very least had prepared the land and purchased inputs such as seeds and pesticides, making it impossible to switch to crops that could potentially find a market domestically.View image in fullscreenConsensus is growing among experts that the turmoil represents an opportunity for rival agriculture economies – and disaster for US farmers.“It’s all happening so fast and in the middle of the growing season, it’s a shock to the system that’s going to be tough for farmers, especially those growing commodities for export,” said Ben Lilliston, director of rural strategies and climate change at the Institute for Agriculture and Trade Policy (IATP). “Tariffs are not magical, they need to be used strategically as part of wider reforms to the domestic economic agenda.”“The volatility of the tariff policy decisions, with new tariffs frequently being announced, paused and placed will take a toll on the American agricultural industry,” writes economist Betty Resnick in an article for Farm Bureau, a right-leaning lobby group. “Without direct support from USDA or a farm bill with an updated safety net, farmers will almost certainly bear the brunt of these tariffs.”Ben Murray, senior researcher with the consumer advocacy group Food and Water Watch, said: “Without a bailout, we can only imagine how bad this will be for farmers and what an opportunity for Brazil – and this is all being done for a tax cut for the wealthy.”For decades now, US farmers have been heavily incentivized through the Farm Bill to grow commodity crops destined for export such as wheat, corn, soy, sorghum, rice and cotton, rather than produce for domestic consumption. The price of commodities is tied to the global market, even if sold domestically. Meanwhile US imports of fruits and vegetables mostly from Latin America have risen, now accounting for more than 50% of consumption, according to USDA data.This globalized agricultural system favors large and corporate-owned operations, as smaller farms struggle more with boom and bust prices, and access to government subsidies and other credit. The number of farms continues to decline, while the average size continues to rise. Market consolidation and corporate profits tend to surge in the agriculture industry after every economic shock including the Covid pandemic, Trump’s last trade war and the banking crisis.Biden implemented a range of modest, imperfect policies to try to ease the pain for smaller-scale farmers including a greater focus on anti-trust, local and regional food systems, and climate resilience – all of which are under attack by the Trump administration.The vast majority of a $19.5bn funding package by the Biden administration for evidence-based conservation practices that improve soil health, air quality and reduce the use of costly fertilizers, pesticides and water will not be honored. The 10-year fund allocated through the Inflation Reduction Act was an addendum to money ring-fenced in the Farm Bill for four oversubscribed programs, after years of pressure from farmers to expand access to the initiatives.Two Biden-era healthy eating schemes worth a combined $1bn to local farmers have been canceled: the Local Food Purchase Assistance (LFPA) program matching producers to food banks, and the Local Food for Schools Cooperative Agreement Program which helped public schools add healthy, locally grown produce on to lunch menus. (The USDA recently agreed to unfreeze funding for existing contracts.)View image in fullscreen“My farm will survive because we’ve been working with school districts for 20 years, but for others in our coalition the funding cliff is very real,” said Anna Knight, who owns an 80-acre citrus farm in southern California.Piling on further misery are mass layoffs within the USDA that were seemingly orchestrated by the billionaire Trump donor Elon Musk.More than 10% of USDA staff have already reportedly agreed to voluntary buyouts, with more expected in coming weeks. This is in addition to several thousand probationary employees who were laid off last month – a move which disproportionately hit local offices beefed up under the Biden administration, and is being challenged in the courts.USDA field offices play a crucial role in rural communities, the place where farmers go for tailor-made technical help from agencies including the National Resource Conservation Service (NRCS) and the Farm Service Agency (FSA) on the latest pest control and planting practices, conservation programs, loans and disaster assistance programs.“It makes no sense taking billions of dollars off the table for programs that improve long-term farm viability and resilience – and which farmers have been lining up for years for – and then spend billions bringing back farmers from financial collapse,” said Jesse Womack, policy expert at the National Sustainable Agricultural Coalition. “It’s looking really bleak with a lot of pain ahead for farmers.”A coalition of environmental and agricultural groups is suing the USDA after it purged an array of climate-related online resources including information on the NRCS website helping farmers access federal grants for conservation practices, and technical guidance on cutting emissions and strengthening resilience to extreme weather like floods and drought.Even if there is a bailout, getting the money to farmers in time to avoid bankruptcy will be much more complicated this time, according to Lilliston from IATP.“Another bailout seems inevitable but there are serious questions about how quickly it could be implemented with such a dysfunctional Congress, local USDA offices shuttered and fewer staff. It’s a very messy situation and farmers are already experiencing harm.”And in the medium and long term: “The US reputation has taken a huge hit. We can no longer be considered a reliable trading partner which is terrible for farmers,” added Lilliston.Even before the current mayhem, almost two-thirds of US rural bankers surveyed in March expected farmer income to decline in 2025, with farm equipment sales dropping for the 19th straight month, according to the latest Rural Mainstreet Economy survey by Creighton University. Grain and cotton prices have plummeted since 2022.View image in fullscreen“We were already in a precarious situation but now, unless there’s a bailout or this trade war is resolved by harvest time, it will be disastrous and a critical mass of farmers could go out of business,” said Adam Chappell, 46, a commodities farmer growing corn, cotton, soybean and rice in Arkansas, where dozens of local USDA staff have reportedly been furloughed or fired in recent weeks.Chappell’s town Cotton Plant was hit with 13in of rain in early April, causing crop losses for many farmers. Chappell’s fields survived the rain but he spent a nervous few weeks after the USDA froze all conservation funds, unsure whether the government would reimburse him, as agreed, for an upfront investment in cover crops and a compost operation. Eventually, after a backlash, the administration backtracked and agreed to honor existing contracts.“The weather is getting stranger and more challenging to deal with every year, while big monopoly corporations are allowed to manipulate the system and squeeze us at every part of the supply chain. Farmers like me lean heavily on the NRCS conservation programs to improve soil health and reduce input costs,” said Chappell. “The tariffs are like adding salt on the wound.”Despite last week’s partial U-turn, Trump’s ongoing and increasingly chaotic trade war risks causing irreparable harm to international markets for farmers, especially but not exclusively China, as well as pushing up the cost of agricultural imports such as pesticides, fertilizer and machinery.China is the US’s third biggest agricultural export market, worth $24.7bn in 2024, down 15% from 2023, as soybean, corn and sorghum sales fell amid rising competition from South America, according to USDA data. China’s top imports from the US are oilseeds and grains. US exports to China supported almost a million US jobs in 2022, according to the US-China Business Council, mostly around agriculture and livestock production.As of Friday, at least 15 agricultural department programs worth billions of dollars to American farmers and rural communities remain frozen, according to Politico, more than two months after they were halted for review to ensure compliance with Trump’s priorities opposing diversity, equity and inclusion (DEI) efforts as well as his crackdown on climate change initiatives.This includes the Biden-era partnerships for climate-smart commodities (PCSC) program – a five-year $3.2bn real-life study into the effectiveness of conservation practices such as cover cropping and reduced tillage for commodity farms.“PSCS was about increasing our evidence base on climate benefits that also help commodity farmers improve soil health, air and water quality – and their bottom line,” said Omanjana Goswami, a scientist with the food and environment program at the Union of Concerned Scientists. “Abandoning this will come at a cost to American farms and the taxpayer.”On Monday, the agriculture secretary, Brooke Rollins, defended dismantling PSCS, claiming it amounted to a Biden-era “climate slush fund” of which less than half the money went to farmers.A spokesperson added: “The USDA has a variety of programs available to producers who have been impacted by recent disasters … [and] is currently building a framework to deliver over $20bn in congressionally appropriated funds to producers who suffered losses during the 2023/2024 crop year. With 16 robust nutrition programs in place, USDA remains focused on its core mission: strengthening food security, supporting agricultural markets, and ensuring access to nutritious food.”And some Trump supporters are keeping the faith.“There are some concerns out there but our farmers are willing to make sacrifices for long-term gains,” said Sid Miller, the Texas agriculture commissioner. “Tariffs are a temporary tool, they won’t be permanent, China needs our grains, they are prideful but will come around like last time.” More

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      Obama condemns Trump’s $2.3bn Harvard funding freeze as ‘unlawful and ham-handed’ – US politics live

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      Good morning and welcome to our US politics blog.Former US president Barack Obama has condemned the education department for freezing $2.3bn in federal funds to Harvard University after the elite college rejected a list of demands from the White House.In some of his most vocal criticism of this Trump administration, Obama praised Harvard, the country’s oldest university, for setting an example for other higher education institutions to reject federal overreach into its governance practices.He wrote in a post on X:
      Harvard has set an example for other higher-ed institutions – rejecting an unlawful and ham-handed attempt to stifle academic freedom, while taking concrete steps to make sure all students at Harvard can benefit from an environment of intellectual inquiry, rigorous debate and mutual respect. Let’s hope other institutions follow suit.
      His comments came after Harvard decided to fight the White House’s demands that it crack down on alleged antisemitism and civil rights violations. It is the first major US university to defy pressure from the White House to change its policies.In a letter to Harvard on Friday, the administration called for broad government and leadership reforms, a requirement that Harvard institute what it calls “merit-based” admissions and hiring policies as well as conduct an audit of the study body, faculty and leadership on their views about diversity.The demands, which are an update from an earlier letter, also call for a ban on face masks, which appeared to target pro-Palestinian protesters; close its diversity, equity and inclusion programs, which it says teach students and staff “to make snap judgments about each other based on crude race and identity stereotypes”; and pressured the university to stop recognizing or funding “any student group or club that endorses or promotes criminal activity, illegal violence, or illegal harassment”.The administration also demanded that Harvard cooperate with federal immigration authorities.Harvard’s president said in a letter that the university would not comply with the Trump administration’s demands to dismantle its diversity programming and to limit student protests in exchange for its federal funding.“No government – regardless of which party is in power – should dictate what private universities can teach, whom they can admit and hire, and which areas of study and inquiry they can pursue,” Alan Garber, the university president, wrote, adding that Harvard had taken extensive reforms to address antisemitism.The department of education announced in March that it had opened an investigation into 60 colleges and universities for alleged “anti-Semitic harassment and discrimination”. It came after protests against Israel’s war on Gaza were put on across campuses last year, demonstrations that many Republicans framed as antisemitic.Harvard’s response to the White House’s demands was in sharp contrast to the approach taken by Columbia University, the epicentre of last year’s protests against Israel’s assault on Gaza.The Trump administration cut $400m in grants to the private New York school, accusing it of failing to protect Jewish students from harassment. The school caved in to demands and responded by agreeing to reform student disciplinary procedures and hiring 36 officers to expand its security team.Stay with us throughout the day as we have more reaction to this story and many others.Hugo Lowell is a reporter in the Washington bureau of the Guardian covering Donald Trump and the Justice DepartmentThe Trump administration on Monday misrepresented a US supreme court decision that compelled it to return a man wrongly deported to El Salvador, using tortured readings of the order to justify taking no actions to secure his release.The supreme court last week unanimously ordered the administration to “facilitate” the release of Kilmar Abrego García, who was supposed to have been protected from deportation to El Salvador regardless of whether he was a member of the MS-13 gang.But at an Oval Office meeting between Trump and El Salvador’s president Nayib Bukele, Trump deferred to officials who gave extraordinary readings of the supreme court order and claimed the US was powerless to return Abrego García to US soil.“The ruling solely stated that if this individual at El Salvador’s sole discretion was sent back to our country, we could deport him a second time,” said Trump’s policy chief Stephen Miller, about an order that, in fact, upheld a lower court’s directive to return Abrego García…The remarks at the Oval Office meeting marked an escalation in the Trump administration’s attempts to claim uncertainty with court orders to avoid having to take actions it dislikes. In Abrego García’s case, officials appeared to manufacture uncertainty in particularly blatant fashion.And the fact that the US is paying El Salvador to detain deportees it sends to the notorious Cecot prison undercut the notion that the administration lacked the power to return Abrego García into US custody.The case started when Abrego García was detained by police in 2019 in Maryland, outside a Home Depot, with several other men, and asked about a murder. He denied knowledge of a crime and repeatedly denied that he was part of a gang.Abrego García was subsequently put in immigration proceedings, where officials argued they believed he was part of the MS-13 gang in New York based on his Chicago Bulls gear and on the word of a confidential informant.The case went before a US immigration judge, who suggested that Abrego García could be a member of MS-13 and agreed to a deportation order but shielded him from being sent to El Salvador because he was likely to face persecution there by a local gang.The Trump administration did not appeal against that decision, and Immigration and Customs Enforcement has since said in a court filing that Abrego García’s deportation to El Salvador was an “administrative error”. The supreme court also called his removal illegal.You can read the full story here:One of China’s lead officials overseeing Hong Kong has condemned punitive US tariffs on China as “shameless” and attacked American “hillbillies” amid a continuing trade war between Beijing and Washington that has caused turmoil in global markets.Xia Baolong, director of the Hong Kong and Macao Work Office, said Hong Kong has never levied taxes on imports and that the US enjoyed a $272 bn trade surplus in the city over the past decade.US President Donald Trump has increased the levies imposed on China to 145%, while Beijing has set a retaliatory 125 percent toll on American imports – a move not followed by Hong Kong.Imposing tariffs on the city is “hegemonic and shameless in the extreme”, and shows that the US does not want Hong Kong to thrive, Baolong said in a pre-recorded speech at an event to mark the 10th iteration of China’s annual national security education day.He said the US “is the greatest culprit in undermining Hong Kong’s human rights, freedom, rule of law, prosperity and stability.”“It is not after our tariffs – it wants to take our lives,” Baolong was quoted as saying.He added that the sweeping US tariffs would not shake the determination of Beijing and Hong Kong governments and that “victory must belong to the great Chinese people”.“Let those American ’hillbillies’ wail before the 5,000-year-old civilisation of the Chinese nation” he said, adding that anyone seeking to bring China into poverty was an “enemy”.Hong Kong is a former British colony that became a special administrative region of China in 1997. In theory, it is governed under a system known as “one country, two systems”, a constitutional arrangement that promised Hong Kong a high degree of autonomy and rights protections.But it is widely seen to have reneged on the deal, crushing pro-democracy protests and imposing a national security law in 2020 – targeting secession, subversion, terrorism and collusion with foreign forces – which has in effect silenced opposition voices among Hong Kong’s once-vibrant civil society.Hong Kong is subject to the high US tariffs imposed on China as it is no longer considered a separate trading entity by Washington so means is not entitled to favourable trading terms anymore. Trump ended Hong Kong’s preferential trade status following China’s security crackdown on Hong Kong in 2020.As my colleague Martin Belam reports in our UK politics live blog, JD Vance has said the US is optimistic it can negotiate a “great” trade deal with the UK.In an interview with online outlet Unherd, the US vice president told Sohrab Ahmari:
      We’re certainly working very hard with Keir Starmer’s government. The president really loves the UK. He loved the queen. He admires and loves the king. It is a very important relationship. And he’s a businessman and has a number of important business relationships in [the UK].
      But I think it’s much deeper than that. There’s a real cultural affinity. And of course, fundamentally America is an Anglo country. I think there’s a good chance that, yes, we’ll come to a great agreement that’s in the best interest of both countries.
      Unlike China, Britain was spared the most punitive treatment in Trump’s initial tariff announcement on 2 April, but British imports in the US still incur a 10% charge while its steel and car sectors incur a rate of 25%.The UK government has been hopeful of a deal to exempt the UK from Trump’s tariffs.The UK’s chancellor, Rachel Reeves, will aim to continue negotiations for an economic deal with the US later this month when she travels to Washington to attend the International Monetary Fund’s spring meetings with other finance ministers. You can read more about Vance’s comments today in this article by my colleague Rachel Hall.South Korea has announced plans to invest an additional $4.9bn in the country’s semiconductor industry, citing “growing uncertainty” over US tariffs.“An aggressive fiscal investment plan has been devised to help local firms navigate mounting challenges in the global semiconductor race,” the finance ministry said.“To foster a dynamic, private sector-led ecosystem for semiconductor innovation and growth, the government will increase its investment in the sector from 26 trillion won ($18.2bn) to 33 trillion won,” the ministry added.Semiconductors are tiny chips that power just about everything, including computers, mobile phones and cars. They are central to the global economy. The UK, the US, Europe and China rely heavily on Taiwan for semiconductors.But South Korea – Asia’s fourth largest economy – is also a major exporter to the US and concerns about the semiconductor sector have hit the Seoul-listed shares of the world’s largest memory chip maker Samsung, and largest memory chip supplier SK Hynix.The statement of extra investment from South Korea’s finance ministry comes after the Trump administration launched investigations into imports of pharmaceuticals and semiconductors on national security grounds.These industries – so far exempt from the 10% US import charges that began on 5 April – may face tariffs after the probes are complete.US President Donald Trump has directed the US commerce department to conduct a three-week investigation into the imports, during which time public comments on the issue will be heard before a decision is made.Trump said on Sunday he would be announcing a tariff rate on imported semiconductors over the next week, adding that there would be flexibility with some companies in the sector.On 2 April, Trump announced sweeping tariffs on global trading partners, including the 25 percent on South Korean goods, before backtracking and suspending their implementation for 90 days.Even so, “duties targeting specific sectors such as semiconductors and pharmaceuticals, remain on the horizon”, finance minister Choi Sang-mok said during a meeting.“This grace period offers a crucial window to strengthen the competitiveness of South Korean companies amid intensifying global trade tensions,” he added.Good morning and welcome to our US politics blog.Former US president Barack Obama has condemned the education department for freezing $2.3bn in federal funds to Harvard University after the elite college rejected a list of demands from the White House.In some of his most vocal criticism of this Trump administration, Obama praised Harvard, the country’s oldest university, for setting an example for other higher education institutions to reject federal overreach into its governance practices.He wrote in a post on X:
      Harvard has set an example for other higher-ed institutions – rejecting an unlawful and ham-handed attempt to stifle academic freedom, while taking concrete steps to make sure all students at Harvard can benefit from an environment of intellectual inquiry, rigorous debate and mutual respect. Let’s hope other institutions follow suit.
      His comments came after Harvard decided to fight the White House’s demands that it crack down on alleged antisemitism and civil rights violations. It is the first major US university to defy pressure from the White House to change its policies.In a letter to Harvard on Friday, the administration called for broad government and leadership reforms, a requirement that Harvard institute what it calls “merit-based” admissions and hiring policies as well as conduct an audit of the study body, faculty and leadership on their views about diversity.The demands, which are an update from an earlier letter, also call for a ban on face masks, which appeared to target pro-Palestinian protesters; close its diversity, equity and inclusion programs, which it says teach students and staff “to make snap judgments about each other based on crude race and identity stereotypes”; and pressured the university to stop recognizing or funding “any student group or club that endorses or promotes criminal activity, illegal violence, or illegal harassment”.The administration also demanded that Harvard cooperate with federal immigration authorities.Harvard’s president said in a letter that the university would not comply with the Trump administration’s demands to dismantle its diversity programming and to limit student protests in exchange for its federal funding.“No government – regardless of which party is in power – should dictate what private universities can teach, whom they can admit and hire, and which areas of study and inquiry they can pursue,” Alan Garber, the university president, wrote, adding that Harvard had taken extensive reforms to address antisemitism.The department of education announced in March that it had opened an investigation into 60 colleges and universities for alleged “anti-Semitic harassment and discrimination”. It came after protests against Israel’s war on Gaza were put on across campuses last year, demonstrations that many Republicans framed as antisemitic.Harvard’s response to the White House’s demands was in sharp contrast to the approach taken by Columbia University, the epicentre of last year’s protests against Israel’s assault on Gaza.The Trump administration cut $400m in grants to the private New York school, accusing it of failing to protect Jewish students from harassment. The school caved in to demands and responded by agreeing to reform student disciplinary procedures and hiring 36 officers to expand its security team.Stay with us throughout the day as we have more reaction to this story and many others. More

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      US begins inquiry into pharmaceutical and chip imports in bid to impose tariffs

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      The Trump administration is kicking off investigations into imports of pharmaceuticals and semiconductors into the US as part of an attempt to impose tariffs on both sectors on national security grounds, notices posted to the Federal Register on Monday showed.The filings scheduled to be published on Wednesday set a 21-day deadline from that date for the submission of public comment on the issue and indicate the administration intends to pursue the levies under authority granted by the Trade Expansion Act of 1962. Such inquiries need to be completed within 270 days after being announced.The Trump administration has started 232 investigations into imports of copper and lumber, and inquiries completed in the US president’s first term formed the basis for tariffs rolled out since his return to the White House in January on steel and aluminum and on the auto industry.The US began collecting 10% tariffs on imports on 5 April. Pharmaceuticals and semiconductors are exempt from those duties, but Trump has said they will face separate tariffs.Trump said on Sunday he would be announcing a tariff rate on imported semiconductors over the next week, adding there would be flexibility with some companies in the sector.The US relies heavily on chips imported from Taiwan, something the then president, Joe Biden, sought to reverse by granting billions in Chips Act awards to lure chipmakers to expand production in the US.Taiwan’s economy minister, Kuo Jyh-huei, said its government would run simulations for various levels of tariffs on semiconductors and seek talks with the US.Taiwan is home to TSMC, the world’s leading producer of the most advanced chips and a main contributor to the island’s GDP. Speaking to reporters outside parliament, Kuo said he would seek to ensure “fair competition” for the Taiwanese industry.The Taiwanese and US chip sectors are complementary, he added.The investigation announced on Monday will include pharmaceuticals and pharmaceutical ingredients as well as other derivative products, the notice showed.Drugmakers have argued that tariffs could increase the chance of shortages and reduce access for patients. Still, Trump has pushed for the fees, arguing that the US needs more drug manufacturing so it does not have to rely on other countries for its supply of medicines.Companies in the industry have lobbied Trump to phase in tariffs on imported pharmaceutical products in hopes of reducing the sting from the charges and to allow time to shift manufacturing.Large drugmakers have global manufacturing footprints, mainly in the US, Europe and Asia, and moving more production to the US involves a major commitment of resources and could take years. More

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      Trump administration sued over tariffs in US international trade court

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      A legal advocacy group on Monday asked the US court of international trade to block Donald Trump’s sweeping tariffs on foreign trading partners, arguing that the president overstepped his authority.The lawsuit was filed by the Liberty Justice Center, a legal advocacy group, on behalf of five US businesses that import goods from countries targeted by the tariffs.“No one person should have the power to impose taxes that have such vast global economic consequences,” Jeffrey Schwab, Liberty Justice Center’s senior counsel, said in a statement. “The Constitution gives the power to set tax rates – including tariffs – to Congress, not the President.”The Liberty Justice Center is the litigation arm of the Illinois Policy Institute, a free market thinktank. It was instrumental in the supreme court case Janus v AFSCME in which it successfully fought to weaken public labor unions collective bargaining power.According to the group’s statement, the tariffs case was filed on behalf of five owner-operated businesses who have been severely harmed by the tariffs. The businesses include a New York-based company specializing in the importation and distribution of wines and spirits, an e-commerce business specializing in the production and sale of sportfishing tackle, a company that manufactures ABS pipe in the United States using imported ABS resin from South Korea and Taiwan, a small business based in Virginia that makes educational electronic kits and musical instruments, and a Vermont-based brand of women’s cycling apparel.Representatives of the White House did not immediately respond to an email seeking comment.The Trump administration faces a similar lawsuit in Florida federal court, where a small business owner has asked a judge to block tariffs imposed on China. More

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      Tariff turmoil to continue as Trump warns nobody ‘off the hook’ amid smartphone exemption – US politics live

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      Good morning and welcome to our US politics blog.In an announcement made late on Friday evening, Donald Trump’s presidential administration exempted smartphones and computers from the 125% levies imposed on imports from China as well as other “reciprocal” tariffs.The devices would be excluded from the 10% global tariff that Trump recently imposed on most countries, along with the much heftier import tax on China, in what seemed like a softening of the president’s trade positioning towards Beijing.US stock markets were expected to stage a recovery after the announcement. Shares in Apple and chip maker Nvidia were on course to surge after tariffs on their products imported into the US were lifted for three months.China’s commerce ministry said the exemption demonstrated the US taking “a small step toward correcting its erroneous unilateral practice of ‘reciprocal tariffs’,” and suggested the American administration cancel the whole punitive tariff regime.However, Trump’s commerce secretary, Howard Lutnick, said on Sunday that critical technology products from China would face separate new duties along with semiconductors within the next two months.“He’s saying they’re exempt from the reciprocal tariffs, but they’re included in the semiconductor tariffs, which are coming in probably a month or two,” Lutnick said in an interview on ABC. “These are things that are national security, that we need to be made in America.”Amid the confusion over the White House’s tariff policy, Trump said he would provide more details on his administration’s approach on semiconductor tariffs later today.But he suggested any tariff exemption for China-made smartphones would be short-lived, writing on his social media: “Nobody is getting off the hook for unfair trade balances”. Stay with us throughout the day as we bring you the latest tariff developments and other US political stories.Spain’s economy minister, Carlos Cuerpo, is expected to meet the US treasury secretary, on Tuesday as he aims to bolster bilateral ties between the two countries.The Trump administration has slapped a 10% tariff on imports of most European goods, including olive oil, although it announced a 90-day pause last week on higher, 25% “reciprocal” duties.Spain is the world’s top exporter of olive oil and also sells important quantities of auto parts, steel and chemicals to the US. The country’s prime minister, Pedro Sánchez, has announced a €14.1bn (£12.2bn; $16bn) government aid package to industry to lessen the domestic impact of Trump’s levies.Maya Yang, a breaking news reporter and live blogger for Guardian US, has filed this story about a warning over the potential consequences of Trump’s erratic economic policies:Billionaire investor Ray Dalio said that he is worried the US will experience “something worse than a recession” as a result of Donald Trump’s trade policies.Speaking to NBC’s Meet the Press on Sunday, the 75-year-old hedge fund manager said: “I think that right now we are at a decision-making point and very close to a recession. And I’m worried about something worse than a recession if this isn’t handled well.”He went on to add: “A recession is two negative quarters of GDP and whether it goes slightly there. We always have those things. We have something that’s much more profound. We have a breaking down of the monetary order. We are going to change the monetary order because we cannot spend the amounts of money.”Dalio’s comments come in response to a tumultuous week across the global stock markets following the US president’s tariffs policies that include a 145% tariff raise on China. The billionaire also said there are “profound changes in our domestic order … and world order”, comparing current times with the 1930s.“I’ve studied history and this repeats over and over again. So if you take tariffs, if you take debt, if you take the rising power challenging existing power, if you take those factors and look at the factors, those changes in the orders, the systems, are very, very disruptive. How that’s handled could produce something that is much worse than a recession. Or it could be handled well,” he said.Dalio, who correctly predicted the 2008 recession, also said the current economic state of the US is “at a juncture”.“Let’s take the budget. If the budget deficit can be reduced to 3% of GDP, it will be about 7% if things are not changed. If it could be reduced to about 3% of GDP, and these trade deficits and so on are managed in the right way, this could all be managed very well,” he said.He went on to urge congressional members to take what he calls the “3% pledge”, adding that if they don’t, there will be a supply and demand problem for debt with results that will be “worse than a normal recession.”You can read the full story here:Chinese President Xi Jinping will be welcomed by Vietnam’s President Luong Cuong today as he seeks to strengthen economic ties in south-east Asia amid a trade war with Washington that has caused turmoil in global markets.In an article for the Nhan Dan newspaper, Xi called for more regional cooperation, saying China and Vietnam were “friendly socialist neighbours sharing the same ideals and extensive strategic interests”.He added that a “trade war and tariff war will produce no winner, and protectionism will lead nowhere”, without explicitly mentioning the US.The visit, planned for weeks, comes as Beijing faces 145% US duties, while Vietnam is negotiating a reduction of threatened US tariffs of 46%. China is Vietnam’s biggest trading partner; Hanoi has a good relationship with both Washington and Beijing.As my colleague Rebecca Ratcliffe notes in this story, officials in Hanoi were shocked when Vietnam was hit with the 46% tariff, even after various efforts to appease the Trump administration. The tariff, which has been paused, threatens to devastate the country’s ambitious economic growth plan.Xi will visit Vietnam, a manufacturing powerhouse, from 14 to 15 April, and Malaysia and Cambodia from 15 to 18 April. He last visited Cambodia and Malaysia nine and 12 years ago, respectively.Xi’s trip to Hanoi, his second in less than 18 months, aims to consolidate relations with a strategic neighbour that has received billions of dollars of Chinese investments in recent years as China-based manufacturers moved south to avoid tariffs imposed by the first Trump administration.Good morning and welcome to our US politics blog.In an announcement made late on Friday evening, Donald Trump’s presidential administration exempted smartphones and computers from the 125% levies imposed on imports from China as well as other “reciprocal” tariffs.The devices would be excluded from the 10% global tariff that Trump recently imposed on most countries, along with the much heftier import tax on China, in what seemed like a softening of the president’s trade positioning towards Beijing.US stock markets were expected to stage a recovery after the announcement. Shares in Apple and chip maker Nvidia were on course to surge after tariffs on their products imported into the US were lifted for three months.China’s commerce ministry said the exemption demonstrated the US taking “a small step toward correcting its erroneous unilateral practice of ‘reciprocal tariffs’,” and suggested the American administration cancel the whole punitive tariff regime.However, Trump’s commerce secretary, Howard Lutnick, said on Sunday that critical technology products from China would face separate new duties along with semiconductors within the next two months.“He’s saying they’re exempt from the reciprocal tariffs, but they’re included in the semiconductor tariffs, which are coming in probably a month or two,” Lutnick said in an interview on ABC. “These are things that are national security, that we need to be made in America.”Amid the confusion over the White House’s tariff policy, Trump said he would provide more details on his administration’s approach on semiconductor tariffs later today.But he suggested any tariff exemption for China-made smartphones would be short-lived, writing on his social media: “Nobody is getting off the hook for unfair trade balances”. Stay with us throughout the day as we bring you the latest tariff developments and other US political stories. More

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      ‘The sky won’t fall’: China plays down Trump tariff risks as stock markets rally

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      China has played down the risk of damage to its exports from Donald Trump’s tariffs, with an official saying the “the sky won’t fall”, as stock markets rose on Monday amid signs of a retreat on electronics restrictions.The world’s second-largest economy has diversified its trade away from the US in recent years, according to Lyu Daliang, a customs administration spokesperson, in comments reported by state-owned agency Xinhua.China has retaliated forcefully to Washington’s tariffs, with 125% levies on US imports against the US’s total of 145% border taxes on goods moving the other way. The trade war has prompted turmoil on financial markets since Trump first revealed tariffs on every country in the world on 2 April. Since then he has partly retreated on the highest levies on most trading partners for at least 90 days, but has doubled down in his spat with China.The White House offered further relief over the weekend with an exemption from the steepest tariffs for electronics including smartphones, laptops and semiconductors. Trump officials later appeared to walk that back with the commerce secretary, Howard Lutnick, saying such devices would be “included in the semiconductor tariffs which are coming in probably a month or two”.Trump said on Sunday night on his social network, Truth Social, that “NOBODY is getting ‘off the hook’”, highlighting that smartphones are still subject to 20% levies and suggesting they could still rise higher.However, investors on Monday appeared unconvinced by Trump’s attempts to play down the retreat. Japan’s Nikkei gained 1.2% while Hong Kong’s Hang Seng rose by 2.2% and the Shanghai and Shenzhen exchanges climbed by 0.8% and 1.2%, respectively. European stock market indices also jumped in opening trades, with London’s FTSE 100 up by 1.6%, Germany’s Dax up 2.2%, and France’s Cac 40 up 2%.“The sky won’t fall” for Chinese exports,” China’s Lyu said. “These efforts have not only supported our partners’ development but also enhanced our own resilience”.The customs report also played up China’s “vast domestic market”, and said “the country will turn domestic certainty into a buffer against global volatility”. China has increasingly tried to stimulate private consumption.skip past newsletter promotionafter newsletter promotionChina’s president, Xi Jinping, on Monday criticised the US tariffs, during a visit to Vietnam. Vietnam has in recent decades grown to become the eighth largest source of goods for US consumers, but it is facing the threat of 46% tariffs when Trump’s 90-day pause expires.In an article in a Vietnamese newspaper, Xi said that a “trade war and tariff war will produce no winner, and protectionism will lead nowhere”. More

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      It is difficult to imagine a post-American world. But imagine it we must | Nesrine Malik

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      “People speak with forked tongues about America,” a veteran foreign correspondent once said to me. It was a long time ago – during a debate about whether the US should intervene in a foreign conflict – and I have never forgotten it. What they meant was that just as the US is condemned for foreign intervention in some instances, it is also called upon to do so in others and then judged for not upholding its moral standards. That dissonance persists, and is even more jarring as we approach the 100th day of Donald Trump’s second term. There is a duality to how the US is seen: as both a country that wantonly violates international law and as the only one capable of upholding that system of law and order. This duality, always tense, is no longer sustainable.I have felt this ambivalence myself – the contradictory demand that the US stay out of it but also anger that it is not doing more. In Sudan, Washington frustratingly refuses to pressure its ally, the UAE, into stopping pumping arms and funding into the conflict. But what proof or history is there to support the delusional notion that the US cares about a conflict in which it has no direct interest? It is an expectation of moral policing from an amoral player that I remember even in childhood, after Iraq invaded Kuwait and the Arab world was rocked with fear of regional war. A fierce debate in our classroom in Sudan on the merits of US intervention was silenced by one indignant evacuee from Kuwait, who said that the most important thing was to defeat Saddam Hussein. Her words occasionally echo in my mind: “We must deal with the greater evil first.”Even in Gaza, as Congress passed package after package of billions in military aid to Israel, there remained some residual hope – long extinguished now – that the phone call to Benjamin Netanyahu would finally come. And even as Trump emboldens Vladimir Putin, abandons Ukraine and slaps tariffs on allies, you can detect that belief in the fundamental viability of the US as an actor that can still default to rationality, and even morality.But, for the first time that I can remember, the conversation is going in a new direction. The appeals to the difference between the presidency and other more solid US institutions are quieter now, as universities, law firms and even parts of the press kowtow to their erratic new king. The questions now being asked are about how Europe and the rest of the world can pivot away from the US, from its USAID programmes nestled within the health budgets of developing countries, and its global system of military assistance and deterrence. But they sound less like practical suggestions and more like attempts to get heads around a reality that is impossible to countenance.The challenge is technical and psychological. It is difficult to imagine a post-American world because America crafted that world. When the US becomes a volatile actor, the very architecture of the global financial order starts to wobble. We saw this in the crisis of confidence in the dollar in the aftermath of Trump’s “liberation-day” tariffs. The robustness of the rule of law and separation of powers – cornerstones of confidence in an economy – are also now in doubt, as the administration goes to war with its own judiciary and the president himself boasts about how many people in the room with him made a killing out of his stock market crash. Is it insider trading if your source is the president?Just as formidable is the mental task of divestment from the US. A friend who holds a green card but lives under an illiberal regime in Asia told me that, deep down, he always felt protected from the dangers of his country’s domestic politics by the knowledge that there was a safe haven to which he could retreat in case of persecution. No longer, as legal residents and visitors are hounded by Immigration and Customs Enforcement (Ice) or turned away at the border. I know others who have cancelled work trips to the US for fear of deportation or blacklisting. With that insecurity comes an awareness that, for some in the global south who always knew that the US was not a benign presence, there was still the belief that there was something within its own borders that curbed its excesses. This was partly true, but also a reflection of US cultural power. The pursuit of liberty and the pursuit of happiness, “give me … your huddled masses”, the Obama hope iconography; all resonant and powerful touchstones. They are now reduced to dust. It is one thing to know that the US was never the sum of these parts, but another to accept it.And there is a fear in accepting it. Because, for all its violations, the advent of a post-US world induces a feeling of vertigo. A world in which there is no final authority at all might be scarier than a world where there is a deeply flawed one. What is daunting is the prospect of anarchy, a new world where there is no organising principle in a post-ideological, everyone-for-themselves system. Not a cold war order divided into capitalist, communist and non-aligned. And not a post-cold war one divided into western liberal overlords, competing non-democracies and, below them, smaller clients of both.But what the US’s breakdown should really trigger is not overwhelm and bewilderment, but a project to build a new global order in which we all have a stake. What the US chooses to do in terms of foreign and economic policy can affect your shopping basket and the very borders of the nation state in which you live. It remains the world’s largest economy, has the world’s largest military, and is the home of the world’s most powerful entertainment complex. This centrality combined with its collapse reveals the fact that the problem goes deeper than Trump. The world was always dangerously overexposed to whatever direction the US took.Ironically, this all might be the beginning of a process that leads to genuine “liberation days” for other countries, but not the US itself. There is pain ahead, but also a sort of independence. Above all, there might finally be a recognition that the US’s definition of peace and prosperity was always its own, enforced by sheer force of power and propaganda.

      Nesrine Malik is a Guardian columnist

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      Trump warns exemptions on smartphones, electronics will be short-lived, promises future tariffs

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      The exemption of smartphones, laptops and other electronic products from import tariffs on China will be short-lived, top US officials have said, with Donald Trump warning that no one was “getting off the hook.”“There was no Tariff ‘exception’, Trump said in a social media post on Sunday. “These products are subject to the existing 20% Fentanyl Tariffs, and they are just moving to a different Tariff ‘bucket.’”In the post on his Truth Social platform, Trump promised to launch a national security trade investigation into the semiconductor sector and the “whole electronics supply chain”.“We will not be held hostage by other Countries, especially hostile trading Nations like China,” he added.The White House had announced on Friday the exclusion of some electronic products from steep reciprocal tariffs on China. US stock markets were expected to stage a recovery after the announcement. Shares in Apple and chip maker Nvidia were on course to soar after tariffs on their products imported into the US were lifted for 90 days.China’s commerce ministry said the exemption demonstrated the US taking “a small step toward correcting its erroneous unilateral practice of ‘reciprocal tariffs’,” and insisted Washington cancel the whole tariff regime.Zhang Li, president of the China Center for Information Industry Development, told state media outlet, China Daily, that the exemptions proved “how important China is to major US tech companies that rely heavily on the country for manufacturing and innovation”.However, Trump’s commerce secretary, Howard Lutnick, said on Sunday that critical technology products from China would face separate new duties along with semiconductors within the next two months.Lutnick said Trump would enact “a special focus-type of tariff” on smartphones, computers and other electronics products in a month or two, alongside sectoral tariffs targeting semiconductors and pharmaceuticals. The new duties would fall outside Trump’s so-called reciprocal tariffs on China, he said.“He’s saying they’re exempt from the reciprocal tariffs, but they’re included in the semiconductor tariffs, which are coming in probably a month or two,” Lutnick said in an interview on ABC, predicting that the levies would bring production of those products to the United States. “These are things that are national security, that we need to be made in America.”The world’s two largest economies have been locked in a fast-moving game of brinkmanship since Trump launched a global tariff assault that particularly targeted Chinese imports. China’s leader Xi Jinping said on Monday that protectionism “leads nowhere” and that a trade war would have “no winners”.Tit-for-tat exchanges have seen US levies imposed on China rise to 145%, and Beijing setting a retaliatory 125% levy on US imports. On Friday Beijing said it would ignore any future raises in tariffs by Trump, as they were already so high that there was “no market acceptance for US goods” in China.On Monday a spokesperson for China’s Customs agency said the country’s exports were facing a complex and severe external situation but “the sky will not fall”. They said China’s domestic demand was broad, and they were building a diversified market.Trump’s back-and-forth on tariffs has triggered the wildest swings on Wall Street since the Covid pandemic of 2020. The benchmark Standard & Poor’s 500 index is down more than 10% since Trump took office on 20 January.After announcing sweeping import taxes on dozens of trade partners, Trump abruptly issued a 90-day pause for most of them. China was excluded from the reprieve.The fallout from Trump’s tariffs – and subsequent whiplash policy reversals – sent shock waves through the US economy, with investors dumping government bonds, the dollar tumbling and consumer confidence plunging.US senator Elizabeth Warren, a Democrat, criticised the latest revision to Trump’s tariff plan, which economists have warned could dent economic growth and fuel inflation.“There is no tariff policy – only chaos and corruption,” Warren said on ABC’s “This Week,” speaking before Trump’s latest post on social media.China has sought to strengthen ties with neighbouring countries amid the escalating trade war. Xi will visit Vietnam on Monday as he begins a tour of south-east Asia.With Reuters and Agence France-Presse More