The Trade War That Wasn’t: How US Partners Failed to Retaliate
US President Donald Trump holds a “reciprocal” tariffs poster during his tariff announcement on April 2.
Photographer: Kent Nishimura/BloombergThis article is for subscribers only.
In Donald Trump’s first term as president, Japan stood out as an exception in opting not to retaliate against his tariff hikes, as the late Prime Minister Shinzo Abe reckoned it was better to shrug them off in favor of maintaining the broader economic and security relationship.
Most others did retaliate, however, and that experience conditioned economists to anticipate damaging tit-for-tat levies in Trump 2.0 if he proceeded with the aggressive trade actions he campaigned on. Except, something happened on the way to the global recession: Aside from China, American trading partners have largely accepted Trump’s new duties.