The Intelligence from The Economist Thy neighbours, beggared: Trump’s opening tariffs
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Feb 3, 2025 
Henry Kerr, Economics editor for The Economist, dives into the impact of Trump’s tariffs on the U.S., Canada, and Mexico. He critically examines the historical context behind these trade policies and the potential ramifications for future economic relations. Kerr also touches on the fascinating revival of supersonic travel, highlighting Boom Supersonic's XB-1 aircraft. Additionally, he discusses the curious rise of standing ovations in London's theatres, questioning the authenticity of audience reactions in the arts.
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Trump's Tariff Strategy
- Trump's tariffs represent the largest attack on free trade in a generation, significantly disrupting global and North American economies.
- These tariffs differ from previous ones in their suddenness, scope, and targets, impacting close trading partners like Canada and Mexico.
Responses to US Tariffs
- Canada and Mexico face an asymmetric challenge responding to US tariffs due to their smaller economies and dependence on US trade.
- Canada responded with selective tariffs on US goods, while Mexico and China have planned retaliatory measures.
Legal Basis of Tariffs
- Trump's tariff impositions are empowered by the International Emergency Economic Powers Act, which grants the president authority in national emergencies.
- This legal basis makes it difficult to challenge the tariffs, unless Congress intervenes.