In sharp contrast with traditional GOP policy on trade and its embrace of laissez faire economics, House Majority Leader Kevin McCarthy has defended the Trump administration for leveraging tariffs on close allies describing the measure as “standing up” for free trade.
“We are in the middle of a trade discussion. Nobody wants to be in a trade war. Nobody wins a trade war,” the California Republican said on CNN. “But we are standing up for the process of where we're moving forward that we have fair trade.”
McCarthy pointed to trade imbalances even with America’s closest allies such as Canada.
“If you are talking about Canada, look what they do when it comes to our dairy products,” he said. “Our wine cannot sit on their supermarkets,” the congressman claimed.
However, he abstained from characterizing the current situation as a “trade war,” saying, “I disagree with trade wars. I don’t think anybody wins a trade war but we are not in a trade war."
Allies hit back
In a sharp rebuke from one of America’s closest allies, Canada's Prime Minister Justin Trudeau said on Sunday that the imposition of US tariffs on metal imports is an insult to their long standing security partnership.
A similar national security argument was presented when the president imposed steep tariffs on aluminum and steel imports from China, Russia, Germany, Canada and some other countries in March.
Trump castigated Canada in a tweet on Friday morning, saying it had treated US farmers “very poorly for a very long period of time.”
Canada has treated our Agricultural business and Farmers very poorly for a very long period of time. Highly restrictive on Trade! They must open their markets and take down their trade barriers! They report a really high surplus on trade with us. Do Timber & Lumber in U.S.?
His strong words followed swift responses to his tariffs by Canada, Mexico and the European Union, which all plan to retaliate with levies on billions of dollars of US goods from orange juice to blue jeans and Harley-Davidsons.
The German government has also called on the United States not to take a “wrong path” by putting tariffs on steel and aluminum imports, warning that a transatlantic trade war could harm both Europe and the US.
The EU has taken the United States to the World Trade Organization to challenge the legality of the new tariffs and the Trump administration’s national-security justification. Brussels has also lodged an eight-page list at the international trade body of goods it would hit with retaliatory measures.