The world’s three dominant economies are entering a combative phase that threatens to deepen fractures and challenges decades of free-market orthodoxy as the U.S. uses trade weapons borrowed from China’s playbook, leaving Europe at a critical crossroads.
Then-U.S. President Donald Trump fired the first shots with tariffs on China seven years ago, and then President Joe Biden ushered the U.S. into the new industrial policy age.
Stage three, punctuated by Biden’s latest round of duties on Chinese imports, builds on the first two: using tariffs to defend U.S. interests, with subsidies now at the core of policy and without fear of retaliation.