Trump Administration Live Updates: White House Presses for Trump's Big Bill as Senators Trudge Through Votes

New York Times

a day ago

For some governments, national security tariffs are potentially more concerning than the reciprocal tariffs Mr. Trump is threatening to apply to their U.S. exports.
Governments around the globe are racing to negotiate trade deals with the United States in order to forestall President Trump's punishing tariffs, which could kick in on July 9. But the discussions have been slowed because Mr. Trump has threatened to impose more tariffs even if those deals are in place.
Mr. Trump announced what he refers to as 'reciprocal tariffs' on April 8, saying they were in response to other countries' unfair trading practices. But he agreed to pause those levies for 90 days to give countries time to reach trade deals with the United States. Some administration officials recently suggested that the deadline could be extended, but Mr. Trump has signaled that he is ready to slap tariffs on countries he views as uncooperative.
'We have countries that are negotiating in good faith, but they should be aware that if we can't get across the line because they are being recalcitrant, then we could spring back to the April 2 levels,' Treasury Secretary Scott Bessent said in an interview with Bloomberg Television on Monday.
India, Vietnam, Japan, the European Union, Malaysia and other governments have been working toward deals that could smooth relations with the United States and avoid double-digit tariffs. But the Trump administration has been moving forward with plans to impose another set of tariffs on certain industries that it views as essential to national security, a threat that has foreign leaders worried that there could be more pain ahead.
These tariffs are dependent on the outcomes of trade investigations into lumber and timber, copper and critical minerals by the Commerce Department, which are expected to be completed soon and submitted to the White House, according to people familiar with the matter. A determination that imports pose a national security threat would allow the president to issue tariffs on those products in the coming weeks. Investigations on pharmaceuticals, semiconductors and electronic devices are also proceeding and could be finished in time for tariffs as early as next month, the people said.
Mr. Bessent added that tariffs on imports of items such as lumber were being imposed on a different track from the reciprocal tariffs that were announced in April and are not part of the current round of trade negotiations.
Those tariffs on certain critical sectors, which would be issued under Section 232 of the Trade Expansion Act of 1962, aim to build up domestic capacity for important products and ensure that the country isn't reliant on foreign factories in times of war or shortages.
But these sectors — along with automobiles and steel, on which the Trump administration has already applied national security tariffs — are also vital industries for America's largest trading partners, like Japan, the European Union and India. These governments have been hesitant to strike a deal with the Trump administration, worried that they only will be hit by more levies down the road. For some foreign governments, these national security tariffs are potentially more concerning than the reciprocal tariffs Mr. Trump is threatening to apply to all their U.S. exports.
For the European Union, tariffs on medicines, the bloc's No. 1 export to America, could be enormously painful. It is unclear whether a trade deal that the United States and European Union have been drafting will address that issue. Friedrich Merz, the German chancellor, has suggested that negotiations should focus on a few key sectors, including medical drugs.
'We now need rapid joint decisions for four of the five major industries: automotive, chemicals, pharmaceuticals and mechanical engineering,' Mr. Merz said last week, adding that 'we don't want the best of the best; we want the most important of the necessary.'
Pharmaceutical tariffs are also a major threat for India, which the Trump team has consistently been optimistic about striking a deal with. Last year, India exported almost $13 billion worth of drugs, and the United States is its biggest market.
For Japan and South Korea, as well as Europe, exports of cars and steel to the United States have been a particular concern. Along with disputes over opening Japan's market to U.S. agriculture, U.S. tariffs on Japanese cars appear to be a thorny obstacle in what U.S. officials presumed would be a relatively smooth negotiation.
Vietnam, Japan, Malaysia, South Korea and Indonesia could be hit by tariffs on semiconductors and other electronics, including phones and computers. Vietnam and Malaysia could also be hurt by tariffs on lumber and timber, which could cover products like kitchen cabinets.
Several foreign governments have tried to negotiate provisions exempting them from other future tariff increases, but it's not clear how lenient the Trump administration will be on national security tariffs.
The Trump administration has sent some mixed messages about how much it might be willing to lower them; some officials insist they are not up for negotiation.
Trump officials have criticized exemptions from global steel tariffs granted to various countries by the Biden administration, saying they undermined their effectiveness. Trade experts said giving tariff exemptions would also risk angering labor unions that support them, and undercut the Trump administration's argument that the tariffs must be in place to protect national security.
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A steel plant in Zelzate, Belgium. For Japan, South Korea and Europe, exports of cars and steel are a particular concern.
Credit...
Kevin Faingnaert for The New York Times
Nick Iacovella, the executive vice president of the Coalition for a Prosperous America, a trade group that supports tariffs, said that if the administration was 'giving away' exemptions on tariffs on critical industries, it was 'signaling to everyone that these really aren't national security issues.'
Privately, Trump officials have said there may be some wiggle room. Notably, the framework agreement that the United States announced with Britain in May included some concessions on national security tariffs on cars and steel.
Britain secured an exemption from car tariffs for a volume of exports set at historical levels. That deal, as well as lower levies on aerospace exports such as Rolls-Royce jet engines, came into effect Monday, more than seven weeks after the framework agreement was announced. For most of that time, companies were unsure when lower tariffs would be implemented. However, the agreement to eliminate steel tariffs hasn't been implemented as the two sides negotiate requirements for British steel companies.
This arrangement has encouraged Japan, the European Union and others to seek a 'U.K.-style deal' to also exempt them from national security tariffs. But some Trump officials say that because the volume of their exports is so large, exemptions would be a major threat to U.S. industry.
British exports of cars and steel to the United States were viewed as too limited to be much of a threat. But such exports from Japan, Korea and Europe are substantial. Jamieson Greer, the United States Trade Representative, has said privately that the British provisions were not a precedent or framework for other countries, according to a person familiar with the remarks.
Peter Harrell, a former Biden administration official who is a nonresident fellow at the Carnegie Endowment for International Peace, said Britain exports about 100,000 cars to the United States each year. But Japan, the European Union and South Korea together exported approximately 3.5 million cars in 2024, a much larger share of the U.S. market.
If the president exempted large quantities of these cars, 'then it doesn't look like you have a 25 percent auto tariff anymore,' Mr. Harrell said. 'He'd face political blowback.'
The Commerce Department and the Office of the United States Trade Representative declined to comment. The White House not respond to a request for comment.
For now, foreign governments appear wary of making substantial commitments on trade, only to see U.S. tariffs rise or potentially fall. The Trump administration is awaiting the outcome of a significant court case on whether the reciprocal tariffs are lawful. That decision could come this fall.
Jake Colvin, the president of the National Foreign Trade Council, a trade organization that advocates open trade, said other countries were 'looking for certainty' in deals with the Trump administration. But uncertainty continues because investigations under the 232 national security provision are still underway.
'Countries do want to make deals with us, but they are not going to agree to anything final until they know the status of the 232 investigations,' he said.
Part of the confusion is because trade negotiations are being handled by various departments. Mr. Greer and his office focus on negotiating tariffs and other trade irritants. But the 232 tariffs fall under the authority of the Commerce Department, which is juggling multiple investigations and other priorities. Some foreign officials have said they have little clarity from the Commerce Department about the likelihood of exceptions.
Philip Luck, an analyst at the Center for Strategic and International Studies, said foreign governments were experiencing 'a lot of frustration and confusion,' in part because countries have been negotiating with multiple officials. They have been hearing different things from different principles, and also been told that all their agreements were contingent on Mr. Trump.
'There doesn't seem to be anybody in charge,' Mr. Luck said.
Jeanna Smialek contributed reporting from Brussels, Eshe Nelson from Lisbon and Alan Rappeport from Washington.