Friday briefing: The pain from Donald Trump’s tariffs are already kicking in –

Good morning.

Donald Trump advocated for tariffs not just in the 2024 presidential campaign but for decades prior, so his pledge to impose them if re-elected should come as no surprise. Yet when the US president finally unveiled his plans on Wednesday, the measures were even more sweeping than most had anticipated. No one has been spared, not even Percy Pig.

Standing on the White House lawn, flanked by a comically giant cardboard chart, Trump announced a blanket 10% tariff on virtually all imported goods, along with what he termed “reciprocal” tariffs on countries he claims are unfairly exploiting the US.

China has been hit particularly hard, with the total levy on Chinese imports reaching 54%. Unsurprisingly, Beijing has vowed to retaliate. But even America’s allies have not been spared: the EU faces a 20% tariff, the UK faces 10%. Japan, hoping to avoid Trump’s ire by pledging to boost US investment to $1tn, has had no such luck, facing tariffs of 24%. Canada and Mexico have been exempted from this round of tariffs, though they have faced their own trade battles with the president. The news was received incredibly poorly by global financial markets. All three major US stock markets closed down in their worst day since the Covid pandemic and Asian markets opened with further losses this morning.

For today’s newsletter, I spoke with Dr James Scott from the political economy department at King’s College London on the potential fallout of Trump’s tariffs. That’s right after the headlines.

Five big stories

1. South Korea | Yoon Suk Yeol has been officially removed from the presidency after South Korea’s constitutional court voted unanimously to uphold parliament’s decision to impeach him over his ill-fated declaration of martial law in December.

2. UK news | At least £22,000 was spent by the Home Office on hiring lawyers in a failed attempt to prevent the release of a hard-hitting internal report that found that the roots of the Windrush scandal lay in 30 years of racist immigration legislation, officials have acknowledged this week.

3. Education | Girls in England say they feel less safe at school and are more disenchanted with their education, research has found. Using data from an international study of pupils at primary and secondary schools, researchers said the steep fall in girls’ “emotional engagement” compared with the years before the Covid pandemic has become a pressing issue for schools.

4. Environment | The climate crisis is on track to destroy capitalism, a top insurer has warned, with the vast cost of extreme weather impacts leaving the financial sector unable to operate.

5. Europe | Hungary will leave the international criminal court because it has become “political”, the country’s prime minister, Viktor Orbán, said as he welcomed his Israeli counterpart, Benjamin Netanhayu – the subject of an ICC arrest warrant – to Budapest for an official visit.

In depth: ‘​The market reaction so far has been overwhelmingly negative​’

The tariffs are the most full-throated expression yet of Trump’s “America First” protectionism, and potentially marks a new era of global trade war. The administration has promised a transition period, acknowledging the likelihood of economic pain for US consumers while insisting that things will all work out in the end. However, it is unclear that US politicians are willing to weather this storm as the first signs of a political backlash in the president’s own party emerge.

Does Trump’s rationale make any sense?

Trump has cited various reasons over the years for his fixation on tariffs, but this latest iteration is largely driven by “good old-fashioned nostalgia”, says Scott – specifically, for the 1950s, when the US dominated global manufacturing. Trump’s vision is that these tariffs will spark a revival of that manufacturing boom.

However, there are several major flaws in his reasoning. Firstly, that era was a unique moment in American history that cannot be recreated. “All of its competitors, namely Europe and Japan, had been completely flattened during world war two, whereas the US hadn’t, so it found itself in an extraordinary position where there was massive demand for its manufacturers,” Scott explains.

Secondly, shifting production to the US would be prohibitively expensive for many companies. Will they be willing to take that risk when there is no guarantee tariffs will remain in place for months, let alone years? While some firms have begun exploring US manufacturing expansion, many may simply wait out the uncertainty and see what happens once the dust settles.

Another challenge is the…