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      Democratic senator says democracy ‘at risk’ in rebuttal to Trump address

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      Michigan senator Elissa Slotkin followed Donald Trump’s record-long joint congressional address on Tuesday by focusing on the risk of a declining democracy, directly challenging citizens to take an active role in holding elected officials accountable – herself included.The first-term Democratic senator, who represents a state won by the president, explained how preserving democracy requires constant, active participation from voters.“Our democracy, our very system of government, has been the aspiration of the world, and right now it’s at risk,” Slotkin said in the official Democratic response. “It’s at risk when the president decides you can pick and choose what rules you want to follow, when he ignores court orders and the constitution itself, or when elected leaders stand by and just let it happen.”The first-term senator outlined a three-step approach for citizens: staying informed, monitoring elected representatives’ voting records, and actively organizing around issues that matter to any given person. She framed citizen oversight as “American as apple pie”.Slotkin fact-checked claims about Trump’s narrative on a booming economy, explaining that while the administration had touted overwhelming success, “the national debt is going up, not down”.The International Chamber of Commerce echoed those concerns earlier today, warning that the massive Trump-activated tariffs on Canada and Mexico risked triggering an economic downturn that could devastate the global economy that followed a mass tumble in the stock market. Slotkin added that risking cuts to social security and other critical programs were not the way to solve the national debt, or government efficiency either.“We need a more efficient government. You want to cut waste, I’ll help you do it. But change doesn’t need to be chaotic or make us less safe,” she said.Drawing from her national security background, Slotkin warned that democracies are fragile institutions that can “flicker out” without real, around-the-clock protection.skip past newsletter promotionafter newsletter promotion“If previous generations had not fought for this democracy, where would we be today?” Slotkin said. More

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      China promises ‘countermeasures’ after Trump threatens additional 10% tariff

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      Donald Trump has threatened China with an additional 10% tariff on its exports to the US, prompting a promise of “countermeasures” from Beijing and setting the stage for another significant escalation in the two governments’ trade war.The US president also claimed he planned to impose tariffs on Canada and Mexico starting next Tuesday, having delayed their imposition last month after talks with his counterparts.Posting on Truth Social on Thursday, Trump said illicit drugs such as fentanyl were being smuggled into the US at “unacceptable levels” and that import taxes would force other countries to crack down on the trafficking.“We cannot allow this scourge to continue to harm the USA, and therefore, until it stops, or is seriously limited, the proposed TARIFFS scheduled to go into effect on MARCH FOURTH will, indeed, go into effect, as scheduled,” the Republican president wrote. “China will likewise be charged an additional 10% Tariff on that date.”If Trump makes good on this latest threat, the move would further strain relations between the US and its largest trading partners.In response, China’s commerce and foreign ministries on Friday vowed to retaliate if Chinese companies were affected by the tariffs, accusing the US of using fentanyl as a “pretext” to threaten China.“Such behaviour is purely ‘shifting blame and shirking responsibility,’ which is not conducive to solving its own problems,” a commerce ministry spokesperson said. “If the US insists on proceeding with this course of action, China will take all necessary countermeasures to safeguard its legitimate rights and interests.”Canada and Mexico have promised to retaliate if the US imposes tariffs on their exports. China hit back swiftly when Trump imposed a 10% tariff on its exports earlier this month.The Trump administration has repeatedly raised the threat of tariffs, vowing to rebalance the global economic order in the US’s favor. A string of announced measures have yet to be introduced, however, as economists and businesses urge officials to reconsider.The duties on imports from Canada and Mexico have been repeatedly delayed; modified levies on steel and aluminum will not be enforced until next month, and a wave of “reciprocal” tariffs, trailed earlier this month, will not kick in before April.This week, the US president vowed to slap 25% tariffs on the EU, claiming the bloc was “formed to screw the United States”, although details remain sparse. Duties will be applied “generally”, Trump said, “on cars and all other things”.The prospect of escalating tariffs has already thrown the global economy into turmoil – with consumers expressing fears about inflation worsening and the auto sector possibly suffering if the US’s two largest trading partners in Canada and Mexico are slapped with taxes.The prospect of higher prices and slower growth could create political blowback for Trump.Associated Press contributed reporting More

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      ‘It’s been a lifesaver’: millions risk going hungry as Republicans propose slashing food stamps

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      During a recent grocery store visit, Audrey Gwenyth spent $159.01 on items such as eggs, Greek yogurt, edamame snaps, bagels, chia seeds, brownie mix, oatmeal, milk, cilantro rice and pork sausage. The entire bill was paid via her electronic benefit transfer, or EBT, card, which is how recipients of the Supplemental Nutrition Assistance Program (Snap), pay for groceries at participating stores, farmers markets and restaurants.“Because I’m a single mom and I don’t receive child support, I don’t have a lot of help in the world,” said Gwenyth, a mother of two toddlers, whose food budget is around $100 per week. She shares many of her EBT purchases on social media to help others make the most of their benefits. “I could not pay for food if it wasn’t for EBT. It’s been a lifesaver.”In the US, more than one in eight households say they have difficulty getting enough food. Snap, formerly known as food stamps, helps more than 42 million people fill those gaps, and is considered the country’s most effective tool to fight hunger. But now, the USDA-run program is facing attacks from House Republicans who see deep cuts as a way to pay for an extension of the 2017 tax bill that benefits the very wealthy.On Tuesday night, the House narrowly passed a budget resolution that called for $4.5tn in tax cuts and a $2tn cut in mandatory spending, which includes programs such as Snap and Medicaid.While it is unknown exactly how much would be slashed from Snap, some estimates say funding could be reduced by at least 20%. The House budget resolution enables committees to cut $230bn from the agriculture committee over 10 years in order to help extend tax cuts for the top 1%, according to the nonpartisan Center on Budget and Policy Priorities.This means the millions who rely on Snap would receive less help, and many of them could lose assistance altogether, even amid rising food costs and inflation.“Hunger and poverty aren’t going to stop because you cut a program,” said Gina Plata-Nino, Snap’s deputy director at the Food Research & Action Center (Frac). “The price of food keeps going up, things are more expensive, people are concerned about tariffs in terms of consumer goods and people relying on these benefits will not have any recourse.”Cuts could be made by limiting how people use Snap, removing benefits from those who lose their jobs and arbitrarily capping maximum benefits. Congress could also convert Snap into a block grant and have states pay a portion of benefits, which could limit access to assistance at a time when families are struggling already.Anti-hunger groups are especially alarmed about proposed alterations to the Thrifty Food Plan, which the USDA uses to determine benefit amounts and the annual cost of living of living adjustment, or Cola. One Republican proposal would cut $150bn from the program by limiting Thrifty Food Plan updates, which means benefits would be slashed for every American using Snap, affecting one in five kids in the US.Republicans have sent mixed signals. The House agriculture chair GT Thompson (Republican of Pennsylvania) said last week there would be no Snap cuts in reconciliation or the upcoming farm bill. But other Republicans have signaled openness to this, and critics of the budget resolution question how lawmakers could possibly chop $230bn without affecting Snap.Even before cuts, the current average Snap benefit is only around $6 a day per person, which means that they often fall short of what people actually need. “When you think about the rising cost of food, that is such a small amount of food,” said Rachel Sabella, the director of No Kid Hungry New York, a non-profit that works to end childhood hunger. “People are making tough choices in the grocery store.”Six dollars doesn’t get you much these days at food retailers. This year, the average price of eggs hit a record high of $4.95, and is expected to keep climbing as the US deals with the ongoing bird flu outbreak. A gallon of milk costs more than $4 and a pound of ground chuck costs $5.50, according to the consumer price index.To get by, families often hide food to save so it lasts later into the month. Caretakers report eating less or cutting their portion sizes and mothers say they sometimes forgo food at the end of the month so their kids can eat. People also reduce protein and produce in favor of cheap filler foods like rice. For people already making concessions, these proposed cuts would be devastating.“I live in poverty, not ignorance, so I keep a monthly budget and watch my spending very closely, which requires precision,” said Brytnee Bellinger, who is visually impaired and receives around $80 per month in food assistance. Bellinger usually spends her Snap dollars on grass-fed bison, which she says helps combat her iron deficiency, and fresh produce from farmers markets. If her benefit amount was reduced, she would likely be unable to afford either.“How are people supposed to balance making healthy food choices with spending wisely if their Snap benefit amount doesn’t accurately reflect the current cost of a healthy diet?” she said. “Poor people buying food isn’t the cause of federal overspending.”After being founded in 1964 as part of Lyndon Johnson’s war on poverty, Snap has been targeted by both Republicans and Democrats. Cutbacks to the program were first made in the early 1980s under Ronald Reagan. Bill Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, which set time limits, reduced maximum allotments and eliminated eligibility of most legal immigrants for food stamps. During his first term, Donald Trump unsuccessfully attempted to cut Snap by 25 to 30%.While the Biden administration has been lauded for updating the Thrifty Food Plan to boost the amount of money people have to buy food, Republicans have made reversing the increase a major priority.GOP lawmakers and conservative thinktanks have falsely criticized the program as having high administrative costs and being rife with fraud and abuse. (In 2023, around 6% of Snap spending went to state administrative costs and few Snap errors are due to fraud on the part of recipients.) They’ve also attacked recipients for using Snap on things such as sweetened drinks. Trump officials have said that they want to ban sugary beverages, candy and more, although similar efforts have failed in the past.And the USDA secretary, Brooke Rollins, signaled on Tuesday that she plans to target Snap under the guise of keeping undocumented immigrants from receiving benefits even though they are already generally prohibited from receiving food assistance.When Snap benefits are cut, researchers have found that children were more likely to be food insecure, in poor health and at risk for development delays. Since Snap is part of a larger ecosystem, advocates say cutting the program will increase healthcare costs, poverty and hardship.Retail giants such as Walmart, Albertsons, Costco, Sam’s Club and Kroger would also be severely affected since Snap dollars are most often spent there. More than 25% of all Snap dollars are spent at Walmart and nearly 95% of the program’s recipients say they shop at the retailer.Food banks and pantries would also be massively affected by cutbacks. “If Snap is cut at the levels they’re talking about, food banks are not going to be able to fill that gap – we’re meant to be an emergency system,” said Jason Riggs, the director of policy and advocacy at Roadrunner Food Bank of New Mexico. “A cut to Snap at this time, when food costs are continuing to rise, the timing is horrifying. We can’t food bank our way out of this.” New Mexico has the eighth highest hunger rates in the nation and Riggs said many of their clients already use Snap.In Los Angeles, 25% of households face food insecurity, far higher than the national average of 14%, and rates are expected to increase due to the effects of the recent wildfires. “If cuts to Snap are enacted, we would need to further draw on philanthropic and community support to try to meet the increased demand for our services,” said Chris Carter, senior policy and research manager at Los Angeles Regional Food Bank, which has distributed $14.2m pounds of food and personal care products through their network, which is a 37% increase compared with last year.Advocates of Snap say there are still countless people who qualify for assistance but do not apply for it due to administrative burdens, social stigma and deeply ingrained myths about welfare and poverty in the US. Food insecure veterans are consistently less likely than nonveterans to be enrolled in Snap and data from the National Council on Aging shows that while nearly 9 million older adults are eligible for Snap, they are not enrolled. Immigrants who are permanent residents or green card holders are only able to apply for Snap after a five-year waiting period, although there are a few exceptions for children and disabled people receiving other benefits.Since being diagnosed with lupus, pancreatitis and gallbladder stones, Michele Rodriguez has been unable to work and had to change her diet to include daily servings of fresh vegetables for juicing to help with her health conditions. If her benefit was reduced, she said she would have to prioritize feeding her two children and rely on food pantries, which would have long lines, or free giveaways for produce.“It’s just devastating because people like myself and seniors and children need help with food,” said Rodriguez, who sees the proposed cuts as being unfair and contrary to what Trump said while campaigning. “The price of food has not gone down. It’s really sad to see he’s only fighting for and helping people like him, but the people in the middle and lower class, what about us? Don’t you want to protect all of us?” More

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      Trump threatens 25% tariffs on foreign cars and semiconductor chips

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      Donald Trump stood firm against warnings that his threatened trade war risks derailing the US economy, claiming his administration could hit foreign cars with tariffs of around 25% within weeks.Semiconductor chips and drugs are set to face higher duties, Trump told reporters at a news conference on Tuesday.The White House has repeatedly raised the threat of tariffs since Trump returned to office last month, pledging to rebalance the global economic order in America’s favor.A string of announced tariffs have yet to be introduced, however, as economists and business urge the Trump administration to reconsider.Duties on imports from Canada and Mexico have been repeatedly delayed; modified levies on steel and aluminum, announced last week, will not be enforced until next month; and a wave of so-called “reciprocal” tariffs, also trailed last week, will not kick in before April.Tariffs are taxes on foreign goods. They are paid by the importer of the product – in this case, companies and consumers based inside the US – rather than the exporter, elsewhere in the world.Asked on Tuesday if he had decided the rate of a threatened tariff on cars from overseas, Trump said he would “probably” announce that on 2 April, “but it’ll be in the neighborhood of 25%”.Upon being asked the same question about threatened tariffs on semiconductors and pharmaceuticals, Trump replied: “It’ll be 25% and higher, and it’ll go very substantially higher over the course of a year.”The ramp-up, he explained, was designed to lure manufacturers to the US. “When they come into the United States, and they have their plant or factory here, there is no tariff.”Executives have cautioned that the administration’s plan for tariffs risks harming the US economy. A 25% tariff on Mexico and Canada “will blow a hole in the US industry that we have never seen”, Jim Farley, the Ford CEO, told an investor conference in New York last week. More

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      ‘It comes from racism’: immigrant workers on Trump’s deportation push

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      Donald Trump has ramped up anti-immigration fervor into his second presidency, promising mass deportations, pushing to increase arrests and bolstering public relations efforts to amplify arrests. The moves have sent a wave of terror through the undocumented worker community that underpins large parts of the US economy.“Every day I wake up and walk out the door, I go with the hope of going to work, but with the fear of not being able to come back,” said a construction worker and single parent in Texas who obtained immigration protection under the Biden administration. She requested to remain anonymous due to fears about her immigration status.“Every day I worry if something happens, who will take my kids,” she said. “I have only one child born in the US. They are the only one who might be able to return, but me and the other kids would not be able to come back.”She claimed that since Trump took office for his second term, there had been fewer opportunities to work construction jobs given the increased fear of Immigration and Customs Enforcement (Ice) raids at workplaces.Despite being in the US for 10 years and constantly trying to obtain documentation, she explained it took her experiencing weeks of wage theft to be able to get documentation through the deferred action program, which provides temporary status and work authorization to immigrants who have been victims of labor abuses.“Unfortunately, these next few years will be years of fear, years of silence,” she said. “I believe the anti-immigrant pushes are racist. People have been taken away without criminal records. We used to have the ability to pay fines before because we didn’t have criminal records, but I’ve heard from other immigrants, anyone being taken into custody by Ice, regardless of their situation, will be deported.”Trump has signed an executive order to allocate military resources at the US border with Mexico and opened Guantánamo Bay prison in Cuba to the detention of undocumented immigrants. The Department of Homeland Security also rolled back a policy of restricting Ice arrests at sensitive locations such as hospitals, places of worship and schools and the agency is pushing to recruit IRS agents to assist in immigration enforcement. The administration is also reportedly planning to reopen family detention centers.View image in fullscreenThe changes come as Trump campaigned with misleading and false statements about immigrants, portraying them as criminals and taking away jobs, including making a baseless claim that Haitian immigrants in Ohio were eating pets.Despite this rhetoric fomenting xenophobic sentiments, an October 2024 report by the Economic Policy Institute on the benefits of immigration to the US cited the enabling of economic growth as the US-born workforce declines, and the payment of nearly $100bn annually in taxes, and noted mass deportations actually result in job losses for US-born workers due to reduced local demand output.Several industries rely heavily on immigrant workers. Nearly 2.9 million immigrants, the most in any occupation group, are employed in construction and extraction, comprising 34% of employment in these occupations in the US.The Guardian spoke with several immigrant workers in construction about their experiences and fears caused by Trump’s immigration policies and the anti-immigrant sentiments stoked by his rhetoric and policies.Another undocumented construction worker in Texas said there is a “constant fear” in going to work every day that his workplace will be raided by Ice or that he will return home to find his family, the majority of whom are undocumented, taken away.“It is a constant fear. It’s something we can’t take from our minds, every instance of the day,” they said. “My main worry is there will be one day where my family might be taken away from me and be sent back to Mexico.”Trying to acquire legal documentation has been “almost impossible”, they added. “The reason behind these policies, it comes from racism. The majority of immigrants aren’t criminals. Like myself, a lot of immigrants come to this country to be able to fulfill their dreams, to be able to work. We’re humans and we have rights. The things we go through when being held in immigration detention, unless you live them, you won’t be able to understand it.”Andres Surquia of Georgia currently has immigration protection through deferred action – a government policy that allows certain undocumented immigrants to work and avoid deportation for two-year periods.“I’m scared because Trump has said he wants to remove deferred-action protections, which took me so long to get,” he said. “As immigrants, we come into this country to work and we want to be respected and protected.”The International Union of Painters and Allied Trades, which represents 140,000 workers in the US and Canada, pushed to secure deferred-action immigration protections for workers experiencing labor abuses in construction for the past several years under the Biden administration.“It was one of the main pillars we put forth as a union, in coalition with other unions, that really view immigration as a working-class issue,” said the IUPAT general president, Jimmy Williams. “Now, under the Trump administration it’s going to go back to all these workers having no recourse, and the employers continuing to be able to use their status as a way to keep them further and further from being able to speak out.”Immigration is a labor and economic issue, Williams said. The union views it as a responsibility to fight and defend these workers because they are their union members. But he expressed disappointment with Democrats whom he feels have so far failed to support these workers.“Where’s the resistance?” Williams asked. “When will the Democratic party really get it right on framing this as a working-class issue and put the target solely on where it belongs, which is on the employers that have abused this system for decades now, keeping workers’ rights down, keeping wages down? You’ve seen limited to no response from the opposition.”A construction worker in Texas who has been pursuing asylum said she had seen fewer people show up to work out of fear in recent weeks.“There’s not many people going to work any more, because of the fear. The only reason why I go to work is it’s a necessity to bring food home and pay bills,” she said. “They want to extract the people that are working in the farms, that are working in the fields, that are working in the restaurants that they eat in, and now they’re taking them without any explanation. It’s not fair.”Milton Velásquez is a construction worker in Maryland from El Salvador who currently has temporary protected status (TPS), provisional protection given to nationals of some countries in crisis. Trump has already revoked these protections for 350,000 Venezuelans and has incited fears he will revoke or limit protections for 1 million immigrants in the US from 17 nations granted protections under the Biden administration.“It scares me because if my TPS does get revoked, I will lose a lot of job opportunities without it and it would limit my income,” he said. “There is always fear of deportation. I try not to think about it, but what scares me the most is having to go back to El Salvador. I would have to work 10 times as much to get paid $10 a day.”Under the first Trump presidential term, Velásquez faced issues with trying to bring his son and daughter to the US from El Salvador through the Central American Minors program, which Trump shut down in 2017. He is still separated from his daughter.“I tried to get her a visa,” Velasquez added. “I’ve been longing to bring them here. That’s what I work for, to provide for my family, to get my family to come here.”Send us a tipIf you have information you’d like to share securely with the Guardian about the impact of the Trump administration’s temporary protected status decision, please use a non-work device to contact us via the Signal messaging app at (929) 418-7175. More

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      Trump policies make US ‘scary place to invest’ and risk stagflation, says Stiglitz

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      Donald Trump’s tariff threats have made the US “a scary place to invest” and may unleash stagflation, the Nobel prize-winning economist Joseph Stiglitz has said.“It risks the worst of all possible worlds: a kind of stagflation,” Stiglitz said in an interview with the Guardian.He argued that despite optimism about the US economy at the turn of the year, the uncertainty created by Trump’s on-off tariff plans and the president’s apparent contempt for the rule of law would deter investment.“If you’re a corporate in the US or in Europe, do you think you have a global market, or do you have just a European market? Where do you locate your factories?” he said.He highlighted Elon Musk’s efforts to slash government departments without congressional authority, and Trump’s disregard for contracts – including the trade pact he struck with Canada and Mexico in his first term – among damaging signals for investors considering the US as a destination.“The government has a huge number of contracts and we’re just tearing them up. How much risk do you want? The US has become, I would say, a scary place to invest,” he said.Stiglitz argued that the uncertainty was likely to slow economic growth, while at the same time Trump’s tariffs – and retaliation by other countries – would drive up inflation.The prospect of rising inflation in the world’s largest economy has led investors to pare back bets on the US Federal Reserve cutting interest rates since Trump’s return to office, amid mounting concern over the fallout from a global trade war.Stiglitz, a Columbia University professor and former World Bank economist who served as chair of Bill Clinton’s council of economic advisers, said the Fed was “clearly worried” about the inflationary effects of Trump’s policies, which could lead it to raise interest rates.“Almost all economists agree that the tariffs will increase prices. How much it will increase prices is a little bit affected by the magnitude of the appreciation of the exchange rate, but all economists think that the extent of the appreciation of the exchange rate won’t be anywhere near enough to compensate for the tariffs.skip past newsletter promotionafter newsletter promotion“I could certainly see a scenario where we get to stagflation – we get inflation, and a weak economy,” he said. “I cannot see a really robust economy, because I just see the global economy suffering so much from the uncertainty that Trump poses.”Scott Bessent, the US Treasury secretary, has suggested the administration wants to bring down 10-year US Treasury yields, an important interest rate, which would have a knock-on effect across global markets. Lower Treasury yields would make it cheaper for Washington to borrow.But Stiglitz suggested the only way the president’s policies would positively contribute to that goal was by running the US into the ground. “The inflation from the tariffs is going in the wrong way, and the only thing that is going in the right way for Bessent is his efforts to crater the economy,” he said.“In supporting Trump’s economic policies, [Bessent] is helping to get the yield curve down by crashing the US economy – not a good policy, I would say.” More

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      Forget Trump’s tariffs, the president’s bond market threat is worse | Heather Stewart

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      When Donald Trump gave an in-flight press conference en route to the Super Bowl last week, it generated a flurry of news, from the fresh threat of steel tariffs to the declaration of “Gulf of America Day”.Much less remarked upon was a throwaway comment about the US’s financial obligations, which underlined the fact that tariffs are far from the only way in which Trump is jeopardising economic stability.“We’re even looking at Treasuries,” the president told reporters. “There could be a problem … It could be that a lot of those things don’t count. In other words, that some of that stuff that we’re finding is very fraudulent, therefore maybe we have less debt than we thought.”The suggestion was that opening up the US Treasury’s data to Elon Musk’s “department of government efficiency” team had identified a money-saving wheeze: why not walk away from some of America’s debt obligations – a “selective default”, as economists call it.Like so many of the serially erratic president’s pronouncements, this one had to be “walked back”, as the Americans call it. Kevin Hassett, his economic adviser, stressed the next day that Trump was referring to other payments that the US Treasury had been making, not its $36tn (£28.6tn) in debt obligations. Hassett suggested the Treasury “had been “sending money out without flagging what it was for”.Yet just entertain for a moment the idea that a US administration might decide it could unilaterally default on even a small portion of its debts. The result would be catastrophic. Because of the dollar’s status as the world’s reserve currency, the yield on US Treasuries – US government bonds – is perhaps the most important benchmark in global financial markets.If investors suddenly began demanding a higher yield – in effect the interest rate – as insurance against the risk they would not get their money back, the effects would ripple through the trillions of dollars of other assets worldwide priced with reference to supposedly super-safe Treasuries.Hassett made clear this is absolutely not an outcome the saner elements of Trump’s administration were aiming for. Indeed, the treasury secretary, Scott Bessent, has said the president wants to bring down the yield on 10-year US government borrowing costs.Yet as a result of Musk’s crazed takeover of the financial plumbing of the state, the US is already welching on its obligations – moral and financial – all over the world.Every day seems to bring fresh examples: health clinics in the developing world being closed because of the dismantling of USAid; researchers whose projects funded by the National Institutes of Health have been put on hold.Officials from the city administration in New York have even claimed the government in effect dipped into the city’s bank account to claw back $80m in federal grants that had already been made.This fast-track austerity is ostensibly aimed at improving the government’s balance sheet – putting the US through “the private equity wringer”, as Wired’s Brian Barrett put it last week.But the Musk/Trump takeover simultaneously risks shattering confidence in US institutions, in a way that is liable to have long-lasting and unpredictable consequences.Five former treasury secretaries warned in an extraordinary New York Times editorial last week of the risks of letting Musk loose on the nation’s financial system.“Any hint of the selective suspension of congressionally authorised payments will be a breach of trust and ultimately, a form of default. And our credibility, once lost, will prove difficult to regain,” they said.Musk has faced legal action and is targeting arms of government with which he has a particular beef, meaning the chances of anything that looks like a formal default remain low.View image in fullscreenBut the whole performance – as exemplified by a rambling Oval Office briefing involving Trump, Musk and his son X (who has the same name as the social media platform formerly known as Twitter) – screams “political risk”, as analysts would call it if it was happening elsewhere in the world.It would not be surprising if efforts to spur the development of alternative global reserve currencies and payments structures – such as those proposed by nations in the global south – are given added impetus by the shenanigans in Washington.The sheer insularity of the Trump administration’s approach was illustrated on Friday when Bessent – supposedly one of the more sensible figures in the administration – said: “The US has a strong dollar policy, but because we have a strong dollar policy it doesn’t mean that other countries get to have a weak currency policy.”In the short term, the most immediate impact of Trump’s plans on the global economy is likely to be via his long-trailed tariffs plan, which will throw sand in the wheels of the international trading system.All of this is likely to dampen growth, and if trade analysts are right that Trump’s latest idea of “reciprocity”, based on each country’s existing tariff and VAT rates, is the opening bid in a negotiation, it may be weeks or even months before any clarity emerges.Given this corrosive uncertainty, markets have so far been remarkably quiescent in the face of Trump’s wayward trade policy, and appear to be relatively unconcerned about Musk’s slash-and-burn mission, for now.They have been putting their faith in the mighty US consumer, and the economy’s powerful and innovative tech sector, to feed the narrative of US “exceptionalism”.But every week of the Trump/Musk show in Washington surely increases the threat of a structural shift in how investors view the US economy – which would ultimately be felt around the world. 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      Trump says US prices ‘could go up’ as he threatens new tariffs on trade partners

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      Donald Trump threatened to ramp up his economic assault on some of America’s biggest trading partners on Thursday, vowing to impose new tariffs on countries that target products made in the US within weeks.The US will impose “reciprocal” duties, the president announced. “We want a level playing field,” he declared in the Oval Office, pledging to roll out a “beautiful, simple system” of new US import duties that match those imposed by other countries.No new specific tariffs were announced, however, triggering a relief rally on Wall Street. Instead, Trump signed a presidential memorandum ordering the development of a comprehensive plan to address what the White House described as “longstanding imbalances” in the global economy.Americans could face “some short-term disturbance” if the US imposes higher tariffs on foreign goods, Trump acknowledged. “Prices could go up somewhat short-term,” he said. “But prices will also go down.”“What will go up is jobs,” claimed Trump. “The jobs will go up tremendously.”The US commerce department, now led by the billionaire Howard Lutnick, will conduct studies and report back to the president at the start of April. No exemptions will be offered from any “reciprocal” duties introduced under the new plan, Trump suggested.It is the latest bid by Trump to strain Washington’s trade ties with countries across the world – allies and rivals alike – to obtain political and economic concessions.A press notice circulated by the Trump administration promised it would take action to “put the American worker first, improve our competitiveness in every area of industry, reduce our trade deficit, and bolster our economic and national security”.US officials pointed to a series of examples of tariffs and other trade barriers that they said demonstrated how other countries were not treating the US fairly. They pointed to the European Union’s 10% tariff on cars, alongside the 2.5% US tariff on cars, and claimed that shellfish from 48 states cannot be exported to the EU, while the bloc “can export all the shellfish it wants to America”.They also cited a 100% tariff imposed by India on US motorcycles, while the US only charges 2.4%, and an 18% duty in Brazil on US ethanol, while the US charges 2.5%.Trump is due to meet Narendra Modi, the Indian prime minister, later on Thursday. Addressing reporters, he argued the EU was “very nasty”, adding: “They don’t treat us right on trade.”He also suggested that the US could hit the so-called Brics alliance – which includes Brazil, Russia, India, China and South Africa – with 100% tariffs, if it sought to undermine the US dollar.Trump also called for Russia’s return to the G7 group of industrialised nations, saying it had been a mistake for Moscow to be expelled. Russia was suspended from the group – then known as the G8 – in 2014, following the annexation of Crimea, and announced its permanent withdrawal in 2017.While the president and his allies believe that higher taxes on imports will help “make America great again”, they have also claimed the mere threat of higher tariffs from the world’s largest economy can prompt nations to bend to Trump’s will.Trump had trailed this announcement for days, at first promising news on Tuesday or Wednesday, before claiming early on Thursday that he would announce reciprocal tariffs – “THE BIG ONE”, he wrote on social media – later in the day. In the event, no specific new tariffs were announced.The administration has so far threatened more tariffs than it has introduced. Duties on Colombia were shelved when it agreed to accept military aircraft carrying deported immigrants; duties on Canada and Mexico have been repeatedly delayed; and modified duties on steel and aluminum, announced earlier this week, will not be enforced until next month.An additional 10% tariff on goods from China is, for now, the only threatened trade attack actually enforced since Trump returned to the White House. On Friday, it emerged that a key component of this – removing the longstanding duty-free status of low-cost packages – had been delayed.Trump’s fixation with tariffs has alarmed economists, who have warned their imposition may derail his repeated promises to rapidly bring down prices for millions of Americans.Inflation is already proving stubborn. In January, as Trump returned to office, it ticked up to an annualized rate of 3%. Egg prices have been soaring in recent months, as many US consumers continue to grapple with the elevated cost of living.Trump said he would not commission any studies into how his mooted tariffs could affect prices for Americans. “There’s nothing to study,” he said. “It’s going to go well.”Asked whether the Trump administration’s plan to align US tariffs with those imposed by other countries risked raising prices for US consumers, Lutnick – standing alongside the president – sought to shift responsibility onto other countries. “​If they drop their tariffs, prices for Americans are going down​,”​ he said.Trump has frequently highlighted the US’s trade deficit with the world – the fact that the value of its imports greatly exceeds that of its exports – as evidence of unfairness.“Closed markets” overseas reduce US exports, while “open markets at home result in significant imports”, the White House notice said, arguing that this had undercut the US’s ability to compete. More