WASHINGTON (AP) – Primed for economic combat, President Donald Trump set in motion tariffs on as much as $60 billion in Chinese imports to the U.S. on Thursday and accused the Chinese of high-tech thievery, picking a fight that could push the global heavyweights into a trade war.
China threatened retaliation, and Wall Street cringed, recording one of the biggest drops of Trump's presidency. But he declared the U.S. would emerge "much stronger, much richer."
It was the boldest example to date of Trump's "America first" agenda, the culmination of his longstanding view that weak U.S. trade policies and enforcement have hollowed out the nation's workforce and ballooned the federal deficit. Two weeks ago, with fanfare, he announced major penalty tariffs on steel and aluminum imports that he said threatened national security.
However, even as Trump was talking tough at the White House, his administration moved to soften the sting of the metal tariffs, telling Congress on Thursday that the European Union, Australia, South Korea and other nations would join Canada and Mexico in gaining an initial exemption. And that raised questions about whether his actions will match his rhetoric.
China isn't shrugging him off. "If somebody tries to impose a trade war on us ... we will certainly fight back and retaliate," said Cui Tiankai, Chinese ambassador to the U.S. "If people want to play tough, we will play tough with them and see who will last longer."
At home, investors on Wall Street showed their rising concern about retaliation and business-stifling cost increases for companies and consumers. The Dow Jones industrials plunged 724 points.