More stories

  • in

    Trump Wields U.S. Power With Unclear Economic Consequences

    President Trump is brandishing the U.S. economy like a weapon, threatening to put more than a trillion dollars of trade on the line with economic wars on multiple fronts.In a high-stakes confrontation that lasted over the weekend and into Monday, Mr. Trump promised to put tariffs on the United States’ closest trading partners, which are together responsible for more than 40 percent of American imports, to try to force them to accede to his demands.Mr. Trump was pushing Canada, Mexico and China to stop flows of migrants at the border — one of his major domestic policy issues — as well as to stem shipments of deadly drugs, and offer the United States better terms when it comes to trade relationships.Both Canada and Mexico earned slight reprieves on Monday after Mr. Trump agreed to delay tariffs of 25 percent — which were supposed to go into effect on Tuesday — for a month. That decision came after President Claudia Sheinbaum of Mexico promised to reinforce the U.S.-Mexico border with 10,000 members of its National Guard. Justin Trudeau, the Canadian prime minister, said Canada would appoint a fentanyl czar, launch a joint strike force to combat organized crime and list cartels as terrorists, among other steps.China has not received any such reprieve and Mr. Trump on Monday said that the 10 percent tariffs that will go into effect on Tuesday were simply an “opening salvo.”Speaking from the Oval Office, the president also made clear that he would use tariffs liberally to get other governments to give him what he wants, essentially saying he would leverage America’s economic strength to bully other nations.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • in

    Trump’s Canada and Mexico Tariffs Could Hurt Carmakers

    General Motors and a few other companies make as much as 40 percent of their North American cars and trucks in Canada and Mexico, leaving them vulnerable to tariffs.Almost all automakers are going to feel a pinch from the new tariffs imposed by President Trump on Saturday on goods imported from Canada, Mexico and China.Auto manufacturers ship tens of billions of dollars worth of finished automobiles, engines, transmissions and other components each week across the U.S. borders with Canada and Mexico. Billions of dollars more are imported from parts manufacturers in China.The tariffs, which will take effect at 12:01 a.m. on Tuesday, are widely expected to raise the prices that American consumers pay for new automobiles. And the tariffs come at a time when new cars and trucks are already selling for near record prices.General Motors, the largest U.S. automaker, will probably be most affected.G.M. produces many more vehicles in Mexico than any other manufacturer — over 842,000 in 2024, according to MarkLines, an auto-industry data provider. And some of those vehicles are the most important in the company’s lineup.All of the Chevrolet Equinox and Blazer sport-utility vehicles G.M. sells in the United States come from Mexico. The Chevrolet Silverado pickup truck, a top-selling model, and the similar GMC Sierra pickup generate huge profits for the company. Of the more than one million of those trucks built last year, nearly half were produced in Canadian and Mexican plants, data from MarkLines shows.All told, G.M. plants in Canada and Mexico produced nearly 40 percent of all vehicles the company made last year in North America, the region where it gets most of its revenue and almost all of its profits.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • in

    Lutnick Grilled on Trump’s Tariffs and China During Confirmation Hearing

    Howard Lutnick, a wealthy donor to President Trump who has been chosen to lead the Commerce Department, defended Mr. Trump’s plans to impose broad tariffs and said he would take a tough stance on technology sales to China during his Senate confirmation hearing on Wednesday.If confirmed, Mr. Lutnick would lead on trade policy and oversee a broad portfolio of government programs touching on business promotion, technology and science. He told lawmakers that he favored “across-the-board” tariffs that would hit entire countries rather than specific products, to equal out America’s trading relationships.He said that, while he believed tariffs on China “should be the highest,” governments in Europe, Japan and South Korea had also taken advantage of the United States on trade. He said that American farmers, ranchers and fishers were being “treated with disrespect around the world.”“We need that disrespect to end, and I think tariffs are a way to create reciprocity, to be treated fairly, to be treated appropriately,” he said. Mr. Lutnick also insisted that tariffs would not cause inflation, though many economists say tariffs are often at least partly passed on to consumers in the form of higher prices.Asked about China’s recent advances in artificial intelligence, Mr. Lutnick said he would take a tough stance on the department’s oversight of technology sales to China, and back up U.S. export controls with the threat of tariffs. He said that the recent A.I. technology released by the Chinese start-up DeepSeek had been underpinned by Meta’s open platform and chips sold by the U.S. company Nvidia.“We need to stop helping them,” he said of China, adding: “I’m going to be very strong on that.”Senator John Thune of South Dakota, the Republican majority leader, during Mr. Lutnick’s confirmation hearing on Wednesday. Republicans promoted Mr. Lutnick’s personal story, describing him as someone who had achieved great success despite facing adversity.Eric Lee/The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • in

    Trump Pitches External Revenue Service to Collect Tariffs: What to Know

    President Trump has promised to generate a “massive” amount of revenue with tariffs on foreign products, an amount so big that the president said he would create a new agency — the External Revenue Service — to handle collecting the money.“Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens,” Mr. Trump said on Monday in his inaugural address, where he reiterated a promise to create the agency. “It will be massive amounts of money pouring into our Treasury coming from foreign sources.”Much about the new agency remains unclear, including how it would differ from the government’s current operations. Trade experts said that, despite the name “external,” the bulk of tariff revenue would continue to be collected from U.S. businesses that import products.Here’s what you need to know about what Mr. Trump has proposed.The U.S. has an established system for collecting tariffs.Tariff revenue is currently collected by U.S. Customs and Border Protection, which monitors the goods and the people that come into the United States through hundreds of airports and land crossings.This has been the case nearly since the country’s inception. Congress established the Customs Service in 1789 as part of the Treasury Department, and for roughly a century tariffs were the primary source of government revenue, counted in stately customs houses that still stand in most major cities throughout the United States, said John Foote, a customs lawyer at Kelley, Drye and Warren.With the creation of the income tax in 1913, tariffs became a minor source of government revenue, and after the Sept. 11 attacks, the customs bureau was moved from the Treasury Department to the Department of Homeland Security.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • in

    Port Workers Could Strike Again if No Deal Is Reached on Automation

    Cargo could stop flowing at East and Gulf Coast ports, which handle most imports, if a union and an employers’ group can’t agree on the use of machines that can operate without humans.Ports on the East and Gulf Coasts could close next week if dockworkers and employers cannot overcome their big differences over the use of automated machines to move cargo.The International Longshoremen’s Association, the union that represents dockworkers, and the United States Maritime Alliance, the employers’ negotiating group, on Tuesday resumed in-person talks aimed at forging a new labor contract.After a short strike in October, the union and the alliance agreed on a 62 percent raise over six years for the longshoremen — and said they would try to work out other parts of the contract, including provisions governing automated technology, before Jan. 15.If they don’t have a deal by that date, ports that account for three-fifths of U.S. container shipments could shut, harming businesses that rely on imports and exports and providing an early test for the new Trump administration.“If there’s a strike, it will have a significant impact on the U.S. economy and the supply chain,” said Dennis Monts, chief commercial officer of PayCargo, a logistics payments platform.The union is resisting automation because it fears the loss of jobs at the ports. President-elect Donald J. Trump lent his support to the union’s position last month. “I’ve studied automation, and know just about everything there is to know about it,” he said on his website Truth Social. “The amount of money saved is nowhere near the distress, hurt, and harm it causes for American Workers, in this case, our Longshoremen.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • in

    Yellen Issues Debt Limit Warning to Congress

    The Treasury secretary urged Congress to protect the full faith and credit of the United States by raising the debt limit.Treasury Secretary Janet L. Yellen informed Congress on Friday that if lawmakers do not act to raise or suspend the nation’s debt limit as soon as Jan. 14 she would most likely need to begin using “extraordinary measures” to prevent the United States from defaulting on its debt.Ms. Yellen issued her warning about the debt limit — which caps the amount of money that the United States is authorized to borrow to fund the government and meet its financial obligations — at a fractious political moment. Republicans are set to take control of Washington next month, and President-elect Donald J. Trump has already called on Congress to abolish the debt limit before he seeks to push through a new round of tax cuts and other spending priorities.The debt limit was suspended in June 2023 after a contentious negotiation over federal spending, work requirements for receiving government benefits and funding for the Internal Revenue Service. That suspension is scheduled to expire on Jan. 2, forcing Treasury to begin using so-called extraordinary measures to allow the federal government to keep paying its bills.Those measures are essentially accounting maneuvers that keep the government from breaching the debt limit. They can include suspending certain types of investments in savings plans for government workers and health plans for retired postal workers.The United States borrows money to pay its bills and obligations, including funding for social safety net programs, interest on the national debt and salaries for members of the armed forces. If the United States is unable to raise the debt limit, it will soon be unable to make many of those payments, including to investors who have bought government debt.“I respectfully urge Congress to act to protect the full faith and credit of the United States,” Ms. Yellen said in a letter on Friday.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • in

    Trump’s Plans to Scrap Climate Policies Has Unnerved Green Energy Investors

    President-elect Donald J. Trump is expected to roll back many of the rules and subsidies that have attracted billions of dollars from the private sector to renewable energy and electric vehicles.Money is the mother’s milk of politics, but the outcome of elections also determines where it flows — and last month’s was especially crucial for the energy industry.Clean investment — including renewable energy as well as the manufacturing of electric vehicles, batteries and solar panels — has boomed since the passage of the 2022 Inflation Reduction Act, championed by President Biden. In the third quarter of 2024, it reached a record $71 billion, according to a tracker maintained by the Rhodium Group, an energy-focused research firm, and M.I.T.The big question looming now on Wall Street: Will President-elect Donald J. Trump, who called Mr. Biden’s policies the “green new scam” during the campaign, pull back enough of those subsidies and regulations to meaningfully change the economics of investing in decarbonization?Market reactions right after the election seemed clear. Clean energy stocks dropped sharply, while shares of oil companies bounced, indicating a divergent view of how the two sectors will fare in the coming years.Near the top of Mr. Trump’s agenda next year is extending his 2017 tax cuts. He will most likely need to reduce spending elsewhere to do that. Clean energy tax credits — worth about $350 billion over just the next three years, according to the Congressional Joint Committee on Taxation — would be a tempting target. The more those subsidies are pared, the more projects would no longer make financial sense.President Biden has championed the 2022 Inflation Reduction Act and other policies designed to address climate change and spur investment in cleaner forms of energy.Kenny Holston/The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • in

    The Economy Is Finally Stable. Is That About to Change?

    President-elect Donald J. Trump’s proposals on tariffs, immigration, taxes and deregulation may have far-reaching and contradictory effects, adding uncertainty to forecasts.After five years of uncertainty and turmoil, the U.S. economy is ending 2024 in arguably its most stable condition since the start of the coronavirus pandemic.Inflation has cooled. Unemployment is low. The Federal Reserve is cutting interest rates. The recession that many forecasters once warned was inevitable hasn’t materialized.Yet the economic outlook for 2025 is as murky as ever, for one major reason: President-elect Donald J. Trump.On the campaign trail and in the weeks since his election, Mr. Trump has proposed sweeping policy changes that could have profound — and complicated — implications for the economy.He has proposed imposing steep new tariffs and deporting potentially millions of undocumented immigrants, which could lead to higher prices, slower growth or both, according to most economic models. At the same time, he has promised policies like tax cuts for individuals and businesses that could lead to faster economic growth but also bigger deficits. And he has pledged to slash regulations, which could lift corporate profits and, possibly, overall productivity. But critics warn that such changes could increase worker injuries, cause environmental damage and make the financial system more prone to crises over the long run.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More