2025-04-12 22:38:54
Watching the wild lines of the S&P 500, U.S. Treasury bond yields, and various foreign markets is how I’ve spent most of the past week. This felt familiar; I’d spent much of 2017 doing the same, following the vagaries of the first Trump administration and tracking the markets’ reactions like a nurse checking a patient’s heart rate.
But despite that familiarity, this isn’t the same as last time. I actually wish it were. This time, there’s no coming back from this quickly. Whoever is elected the 48th president won’t be able to easily rebuild what Donald Trump is busy destroying. Countries can and will move on without the United States. Their firms will establish new supply chains and pursue other markets. Even if the U.S. were the ultra-dominant trading partner it used to be, the credibility of the nation’s promises, its treaties, its agreements, and even its basic rationality has evaporated in just weeks.
The first Trump administration flirted with protectionism, but nothing like what the second Trump administration is trying now. Those earlier efforts seem quaint in hindsight. Not only were tariffs imposed selectively on specific goods such as solar panels and aluminum, but they were much smaller in size and escalated gradually over the course of 2018 and 2019. This was trivial compared with the plans launched and unlaunched over the past 10 days that have sent bond markets reeling. Usually, investors in search of a haven from a plummeting stock market will flee to buy safe, reliable U.S. Treasury bonds, but the opposite seems to be happening, indicating that investors no longer view the U.S. government as the safest bet in town.
America sports a half-earned cockiness that has mostly served the country well. But as the Financial Times’ Tej Parikh pointed out earlier this week, the United States “isn’t the main driver of global trade growth,” and despite being the world’s largest economy, just over 13 percent of world imports flowed into its borders (as of November 2024). Instead of reshaping trade partnerships to further benefit the U.S., it could be left behind. One analysis Parikh cites—as something of a thought experiment, hopefully—tries to model what would happen to America’s trading partners if the country were to be fully closed to trade in 2025. That analysis predicts that, within the year, nearly 41 percent of U.S. trading partners would have fully recovered from the lost U.S. exports, and by 2029, 100 out of 144 trading partners would have recovered the entirety of their loss of U.S. sales because of the expected growth in other economies.
[Read: The tariff damage that can’t be undone]
America’s economic dominance has long been supported by alliances, faith in U.S. debt, and the independence of the Fed. Those three things “were all built on trust that took decades to build,” the economist Ernie Tedeschi told me. Over the course of the rest of Trump’s new term in office, “they could be decimated, taking decades more to rebuild, assuming our politics even has the energy to do it.”
This will be a painful process. Firms will go out of business, workers will lose their jobs, and the world will be poorer for it. But it can move on without us. As the economist Scott Lincicome pointed out earlier this year, countries have not stalled on signing free-trade agreements. In just the past few days, the European Union and the United Arab Emirates have launched free-trade talks, as have the EU and Australia, the United Kingdom and India; and senior officials from China, Japan, and South Korea have already held their first trade talks in five years.
The problem facing future administrations—and this one, in the unlikely event that it gains a modicum of rationality—is that the country has killed its reliability. “Trump has unilaterally decided that I’m going to wreck the credibility of international agreements,” Skanda Amarnath, the executive director of the research and advocacy organization Employ America, explained to me. “If you’re a manufacturer, industrial firm,” he said, “what is the confidence you have that the rules are not going to change for arbitrary and capricious reasons?”
Trump himself is certainly to blame. Yet many of the people I have spoken with lay blame at the feet not of the president, but of the legislature, which refuses to assert itself as a co-equal branch of government.
The right to levy taxes is reserved for Congress, not the president. To enact these tariffs, Trump is using emergency powers that he has invoked because of what he views as a “national emergency posed by the large and persistent trade deficit” between the U.S. and other countries. This is a breathtaking use of these powers; the International Emergency Economic Powers Act of 1977 was meant for an “unusual and extraordinary threat,” which, of course, trade deficits are not. According to the Brennan Center for Justice, no president has ever invoked tariff authority through this law. As a result, Congress or the courts could constrain him. “Somebody in the federal government is going to need to demonstrate that these laws on the books are not blank checks for a single individual to destroy trillions of dollars of wealth with the stroke of a pen,” Lincicome argued to me.
It was once possible to believe that Trump’s first reign was a fluke, a glitch, a deviation from the slow, unyielding march of liberal democracy. After all, he lost the popular vote in 2016, carried into the presidency on an Electoral College bias that discounted the votes and voices of millions. Moreover, he was deeply unprepared for the actual job of being president, his campaign having been shunned by most of the Republican establishment that had experience running White Houses past.
When former President Joe Biden ran for election in 2020, he did so to restore normalcy. In his announcement video, he proclaimed, “I believe history will look back on four years of this president and all he embraces as an aberrant moment in time.” No such luck.
A principled ideologue can be more dangerous than a craven politician. Trump may have paused some of the tariffs enacted earlier this week, but he’s still plowing ahead with the largest trade war America has seen since the 1930 Smoot-Hawley Tariff Act. The bond markets are in serious trouble, and Trump’s polling on his handling of the economy is plummeting. But the president seems remarkably stalwart. He is, it turns out, a true believer. Wrong as he may be, Trump is behaving like a man seeking an age-defining legacy.
I’ll bet he gets one.
2025-04-12 22:00:00
The director Alex Garland’s 2024 film, Civil War, was gritty, realistic, and often horrifying to watch, but it was fundamentally a flight of fantasy. One could debate just how fanciful its near-future depiction of America going to war with itself over a president who refused to leave office was, but for all that movie’s intense effort to depict combat realistically, Garland was only imagining the reasons for it. The premise of his follow-up, Warfare, feels like a challenge the filmmaker issued to himself: What if you stripped away all the hooky plotting typical of military dramas, and just put an unembellished skirmish from a real war on-screen? Would it still work as cinema?
The answer is yes—but Warfare is without a doubt a tougher pill to swallow than its predecessor. Garland wrote and directed the movie in collaboration with Ray Mendoza, a former U.S. Navy SEAL. Mendoza served as the military adviser on Civil War and helped Garland design some of its most ambitious action sequences. Where Civil War envisioned a dark future, Warfare conjures a specific, harrowing day from Mendoza’s past. It re-creates a military operation from the 2006 Battle of Ramadi, during the Iraq War, when things went punishingly awry for Mendoza’s unit. That Warfare is, in dramatically rendering a true story, visceral is hardly a surprise. What’s fascinating is how so much of the film commits to the waiting that exists during battle: the taxing, dull tension of knowing that something might happen any minute.
Singling out Warfare’s level of patience is not to suggest that the film is boring—it’s far too stressful for that. Instead, it’s to acknowledge the film’s complete rejection of the typical storytelling rules for how to portray action: that it should have peaks and valleys throughout a three-act structure. Warfare is anticipation, then chaos, then a cooldown for relief. While watching, I kept considering Ridley Scott’s Black Hawk Down—a grander-scale reconstruction of real-life urban warfare, focused on the 1993 Battle of Mogadishu in Somalia, which I consider a high-water mark for technical proficiency. But that movie still has much more of a Hollywood sheen to it than Garland and Mendoza’s: Black Hawk Down slowly introduces its ensemble at base camp, laying out personality types and mission specifics and showing us every level of command, from besieged grunts to steely-eyed colonels staring at monitors.
[Read: Civil War was made in anger]
Warfare has none of that exposition—it’s resolutely embedded with Mendoza’s specific unit, whose mission is only somewhat clear to the audience. The soldiers are surveilling a residence in Ramadi, hoping to clear ground for more troop movement the next day; eventually, they realize that the place next door is an insurgent base, and the group has to dig in as it’s besieged on all sides in enemy territory. Mendoza (played by D’Pharaoh Woon-A-Tai) is not positioned as more or less important than the rest of the unit, and there are no specific bits of derring-do for any of the men to help distinguish themselves. The camerawork is detached and unshowy, providing long, sometimes demanding takes and denying the viewer the respite that comes with cinematic flair.
Like Black Hawk Down, Warfare features a cast of talented, good-looking young stars on the rise, including Will Poulter, Charles Melton, Noah Centineo, Kit Connor, Joseph Quinn, and Cosmo Jarvis. Their presences in the unit are the main helpful concessions Garland and Mendoza offer the viewer, providing familiar, distinct faces to latch on to while trying to comprehend the opaque events. Still, everyone’s caked in dirt and mud and clad in camo fatigues and wraparound glasses—glitz is in short supply. There’s a thrill in trying to piece together each person’s role amid the things that are going wrong with the group’s mission; we watch the men respond differently to the unexpected attacks they face and process the tension growing within their outpost. But giving yourself over to the anxiety is just as easy. Most of these servicemen had to learn to embrace the frustration and confusion that can come with wartime conflict—such as not knowing where or even who your opponent might be—and Warfare encourages the viewer to do the same.
Neglecting to lay out the specific stakes diverges from Garland’s Civil War, an ostensibly apolitical movie about a fictional political event, that depicted the tumult through the eyes of war photographers. Civil War’s characters had essentially sworn a professional oath of impartiality, a dispassionate perspective that Garland extended to the film itself. But his preference for letting the audience make up its own mind was frustrating for the many viewers who wanted Civil War to take more of a stance. Warfare is even more bluntly neutral. Mendoza and Garland don’t so much as hint at why these soldiers have signed up for combat, or at their level of personal investment in the purpose of their mission; they spend no time on sermonizing about the Iraq War’s morality, or ratifying any audience member’s belief on the topic, as similar historical war films often do.
[Read: Alex Garland knows you might hate Men]
Instead, Warfare is a memory play, an intimate portrait of one of Mendoza’s personal recollections. But the bitter reality of what unfolds over 90 or so minutes during this challenging day—all of that waiting around between the gunfire—is enough to get the viewer thinking about the incremental, tedious surrealism of war. Warfare depicts a circumstance that many audiences would likely never want to experience; it’s all the more crucial, then, to stare down the frightening ambiguity without narrative assuagement.
2025-04-12 21:31:57
Editor’s Note: Washington Week With The Atlantic is a partnership between NewsHour Productions, WETA, and The Atlantic airing every Friday on PBS stations nationwide. Check your local listings, watch full episodes here, or listen to the weekly podcast here.
Donald Trump’s trade war has unleashed global uncertainty. Panelists on Washington Week With The Atlantic joined to discuss the fallout from the president’s policies—and his insistence that tariffs are the key to strengthening the American economy.
Trump is “not particularly ideological,” Ashley Parker said last night, but there are a few areas in which he’s remained consistent: immigration and tariffs. “He hates the idea that anyone is taking advantage of him or taking advantage, now, of his country, of the United States,” she said.
With the president’s continued insistence on imposing high, global tariffs, “he does not want America, in his eyes, to be getting a ‘bad deal,’” Parker continued. “Despite not having a particularly clear ideology on a number of things, he fundamentally believes that trade imbalances mean that America is getting ripped off.”
Joining the editor in chief of The Atlantic, Jeffrey Goldberg, to discuss this and more: Zolan Kanno-Youngs, a White House correspondent for The New York Times; Jonathan Karl, the chief Washington correspondent for ABC News; Ashley Parker, a staff writer at The Atlantic; Tarini Parti, a White House reporter for The Wall Street Journal.
Watch the full episode here.
2025-04-12 21:00:00
When Donald Trump launched his tariff war on April 2, lawmakers in Europe struggled to understand the strategy. Was it a bluff, or did he really mean to collapse global trade, stock markets, and the Western alliance in one reckless game of 4-D chess?
On April 9, however, the president discovered something that we in the United Kingdom already know: Against the bond market, there is only 2-D chess, and you always lose. Because the Brits have been here before.
In September 2022, after the ousting of Boris Johnson as Conservative leader, the new prime minister, Liz Truss, launched an unscheduled Budget statement designed to rip up the rules of fiscal policy. She would enact £160 billion worth of tax cuts over five years, funded entirely by borrowing, in defiance of advice from the U.K. Treasury’s most senior official, whom she sacked on day one of her administration.
The government’s fiscal watchdog, set up to prevent the kind of debacle that was about to happen, was sidelined. Commentators, myself included, who warned that the heavily indebted country might face a sudden stop of foreign investment were ignored.
The consequences came fast. The pound slid, the yield on 10-year government bonds soared close to 5 percent, and we then discovered that lenders’ margin calls on leveraged bond trades—demanding an additional commitment of capital to prop up the loans—were forcing pension funds to raise money by dumping gilt-edged securities into a falling market.
With key pension schemes close to collapse, Truss reversed the entire package; sacked her finance minister while he was midair over the Atlantic Ocean on his way back from an International Monetary Fund meeting in Washington, D.C.; and resigned after just 45 days in office, becoming the shortest-serving prime minister in history. Toward the end, Britain’s tabloid press began livestreaming images of a supermarket lettuce, betting that it would outlast Truss’s tenure. It did.
[Helen Lewis: Liz Truss fought the lettuce, and the lettuce won]
With Trump’s tariff pause, some important details are different. Unlike the United Kingdom, which is exposed to external liabilities worth more than five times its GDP, the United States bears much smaller risks from investors dumping the dollar and Treasury bonds simultaneously. And Truss’s mistake was a simple act of economic hubris rather than part of a geopolitical grand strategy, as Trump’s trade policy claims to be.
Yet something can be learned from the similarities. In both cases, the crucial days saw equities and bonds fall in tandem—something the high-finance textbook says should not happen. Normally, when stock markets are falling, investors switch to the safety of government bonds. Today, we are seeing capital flight from an entire national entity.
Since Truss’s resignation, the U.K. has suffered permanently higher bond yields and higher debt-servicing costs than its European peers. At the same time, interest rates on household mortgages have remained painfully high—a phenomenon dubbed the “moron premium” by her detractors.
Inflicting pain on U.S. investors may be part of the president’s plan, to show China that in pursuit of economic decoupling, America is prepared to suffer. But once you break a complex system, stuff tends to happen that you didn’t intend.
As I write, the dollar is falling and—despite the 90-day pause on reciprocal tariffs—the yield on a 30-year Treasury bond is close to 5 percent. That means the cost of borrowing for the U.S. government is now double what it was five years ago, because investors are demanding higher returns for holding the safest debt in the world. If both of these circumstances persist next week, and begin to affect Americans’ income, the moron premium may cross the Atlantic.
Whether Trump planned to withdraw the reciprocal tariffs within seven days of imposing them is difficult to determine, but the evidence suggests that he did not. The more probable interpretation is that he caved under pressure from both the markets and Republicans in Congress who were growing anxious about the risk of a recession and what that would do to the party’s electoral prospects.
Trump gave in for the same reason Truss did. For the second time in three years, the reckless leader of a major English-speaking power has played mind games with global bond investors and lost. Just as Truss weakened Britain in the long term, both the style of Trump’s tariff gambit and its outcome may have weakened America.
[Read: The tariff damage that can’t be undone]
One rationale for Trump’s plan has some legitimacy: If the U.S. wants to reindustrialize, to ensure its own long-term security in the face of China’s rise, then forcibly preventing the flood of manufactured goods into America is one way of doing that, albeit brutal and risky. But the logical outcome of that approach would be the end of dollar dominance. The U.S. trade deficit with the rest of the world is what creates the demand for foreigners to hold its government debt. Once that demand is suppressed, the U.S. will cease to become the global supplier of safe securities. In addition, by treating former geopolitical friends as enemies, he risks sacrificing all of the premiums that arise from the dollar’s prestige and stability.
Trump appears to believe he can solve the latter problem through what the Cold War strategist Thomas Schelling called “compellence.” America will strong-arm the rest of the world to go on lending to it, despite the newly unfavourable terms. It will use the threat of tariffs to force Europeans to buy such American food products as chlorinated chicken and hormone-treated beef—which their governments currently ban on health grounds—and the U.S. oil they no longer need, through a mix of chaos, disinformation, and chutzpah.
But that is irrational because it requires Trump and his allies to establish an instrumental, political version of “exorbitant privilege,” as a French finance minister once described America’s sway over the global economic order. This would be the right to dictate: to Britain that it ceases jailing people who harass women outside abortion clinics; to Germany that it allows free speech for fascists; to Ukraine that it gives away territory. A plan based on coercion of America’s allies, rather than of its adversaries, seems very unlikely to work.
At a geopolitical level, the Trump administration appears torn among three strategies. The first was outlined by Defense Secretary Pete Hegseth in Brussels in February: Our focus is the Pacific, so we are deprioritizing conventional military deterrence against Russia; it’s up to the Europeans to hike their defense spending to 5 percent and to keep Ukraine in the fight. That is a reality most European nations are now ready to accept.
The second, less palatable strategy would be a 21st-century version of the Monroe Doctrine: forget confrontation with China; solidify control over the Americas by subordinating Panama, Canada, and Greenland; and prosper through industrial self-sufficiency. A third might involve Trump’s offer of a strategic deal to Russia to break its alliance with China—what some analysts have called a “Reverse Nixon”—which might appeal to Vladimir Putin but would effectively end NATO’s Article V collective-security guarantee to European nations threatened by Russia.
For Europe’s leaders, option three would represent a deadly threat. And because they fear that all of these options are in play, their reactions to the tariff war are framed primarily through a security lens, not an economic one. In most European capitals, the United States is already seen as an unreliable ally, an unstable democracy, and a destructive force for economic stability.
The week’s market chaos orchestrated by Trump comes on top of this. The danger now is that, just as with the Truss fiasco, Americans will pay a permanent price for a crazed gestural event. Unlike what happened with Truss, who was swiftly deposed by her own party’s lawmakers, the U.S. has no immediate prospect of getting rid of the man in charge. Most Europeans know that, if Trump’s goal is to treat them as the enemy in a trade war and to hand parts of the European continent to Vladimir Putin, then Europe, too, has options. One is to unite the rest of the West into a global free-trade zone, encompassing not just Europe itself but also Australia and Canada. Another is to make a strategic economic rapprochement with China—and European Union leaders have already arranged to meet with China’s leader, Xi Jinping, in a few months’ time. A third option is to shut America’s tech and service companies out of the European market, together with its defense giants.
Any of these options would have seemed unthinkable until very recently. Now Britain and Europe’s roughly 500 million citizens are very much thinking about what they might look like in practice. Should the Western alliance fracture irrevocably, along trade and security fault lines, the consequences for the United States would be negative in both dimensions.
If America is now entering a period of strategic confrontation with China, it would need allies and supply chains spanning continents from the Nordic countries to the Red Sea. Alliances and supply chains are both built on trust. The U.S. reserves of trust just went way down.
2025-04-12 21:00:00
This is an edition of The Wonder Reader, a newsletter in which our editors recommend a set of stories to spark your curiosity and fill you with delight. Sign up here to get it every Saturday morning.
Seed oils—think canola, soybean, corn—have long been “maligned by both the crunchy left and the MAHA right,” Rachel Sugar wrote yesterday. Many consider them to be unhealthy, despite no scientific evidence to back up that claim. (Just don’t use a black plastic spatula to spread oil around.) But in a trade war, these underdog oils will have one important thing in their favor: They’re inexpensive, and are likely to stay that way. Today’s newsletter explores the future of the oil we eat.
On Oil
Guess What Kind of Cooking Oil Is Tariff-Proof?
By Rachel Sugar
Seed oils are about to get their revenge.
America Stopped Cooking With Tallow for a Reason
By Yasmin Tayag
Robert F. Kennedy Jr.’s view on fats is about bucking convention, not promoting health.
Americans Have Lost the Plot on Cooking Oil
By Yasmin Tayag
Olive oil is a great choice. So is canola oil, vegetable oil, avocado oil, and pretty much everything else.
Still Curious?
Other Diversions
P.S.
I recently asked readers to share a photo of something that sparks their sense of awe in the world. “Traveling through Bosnia, we came to a stop on the road as a shepherd herded his sheep across it in front of us,” Mary Beth, 64, from Pittsburgh, Pennsylvania, writes. “They ended up making their way to this field. Amazing how shepherds have been caring for their sheep for thousands of years.”
I’ll continue to feature your responses in the coming weeks.
— Isabel
2025-04-12 20:00:00
President Donald Trump sent the global economy into turmoil last week by imposing tariffs on all foreign goods arriving in the United States. Then he altered his own policy, announcing Wednesday that, excepting a 145 percent tax on goods from China and a 10 percent general tariff, he was pausing the new levies for 90 days. At a moment’s notice, another policy change or even a pointed social-media post from Trump could alter the global business climate, further deplete Americans’ retirement accounts, increase the already growing risk of a recession, undermine job security, and doom the fate of small businesses.
No one man should have all that power. But there is an obvious solution—one that has almost been forgotten in the second Trump term. Congress should do its job. The legislature is both duty-bound to address these risks and best-positioned to remedy them. Citizens, for their part, can pressure their representatives to do what’s right.
Trump was acting under the dubious theory that the International Emergency Economic Powers Act, passed in 1977, allows him to impose tariffs, which the law does not specifically mention, in an emergency. In his telling, America’s trade deficit qualifies as one. The Constitution, however, vests Congress with the power to levy tariffs. The Founders were wise in making that choice: Investors seek regulatory environments characterized by stability and the rule of law, not erratic patrimonialism. They build new factories when they are confident that trade policies will be in place for years, instead of changing every few days.
Members of Congress should fulfill their oath to defend the Constitution by canceling the tariffs that Trump has imposed—or, if a majority likes any of his tariffs, it should vote them in so that they are lawful. Congress should further clarify that he lacks the power to impose new ones. Failure to rein in Trump would cede to him kinglike authority over the American economy, hand future presidents the same authoritarian tool kit, and create a sense of uncertainty that could impede the domestic industrial growth that some tariff proponents hope to stoke.
[Read: This is why dictatorships fail]
What’s more, a president who wields the tariff power invites an orgy of corruption. If scores of industries stand to gain or lose billions of dollars based on the whims of one man, and if countless private businesses stand to succeed or fail based on the exemptions that he approves or denies, then the president has an ongoing, almost limitless opportunity to enrich himself and his cronies, while entrepreneurs face endless pressure to bend the knee. Giving one person so much influence over picking winners and losers poses a threat to the rule of law greater than any domestic policy in my lifetime.
Congress has diminished its own influence in recent decades, to the detriment of America’s constitutional order. Tariffs are an obvious issue on which proponents of a strong Congress could reassert themselves. Many members of Congress—including Republicans who are otherwise deeply loyal to Trump—have already spoken out against the Trump tariffs. In the Senate, multiple bills have been introduced to rein in or end Trump’s tariffs, some with Republican backing. GOP Senator Rand Paul, who signed on to one of the bills, has emerged as a leading critic of allowing any president to impose tariffs. In the House, most Republicans are more reluctant to cross Trump, but many quietly favor freer markets. And most don’t want to see the U.S. economy thrown into turmoil.
Love or hate Trump, the American project, as it’s been understood from the start, is simply incompatible with aggregating extreme power in any individual. Trump’s 90-day tariff pause (if he sticks to it) averted a stock meltdown, but only Congress can credibly show the world that Trump can no longer throw our economy into a tailspin. And though lawsuits against Trump’s tariffs have been filed, they take time. Only Congress can act with speed to mitigate the harm Trump is causing and ensure that he doesn’t plunge the country into a depression.
The most promising means of rallying Congress to do its duty is one the Framers envisioned: marshaling enough popular sentiment to impel the legislature—particularly the House, the body meant to most immediately reflect popular discontent—to stop the president from behaving like a king. For American citizens, making House members fear voters more than they fear Trump is achievable. Trump is a lame duck with an underwater approval rating. The tariffs are already unpopular, and likely to become only more so as prices rise and the economy slows. Still, lots of citizens will need to call, write to, or petition their representatives, and attend town halls. To succeed is merely to convey this message: “Fight to reclaim the tariff power, or I’ll fight to oust you from the House.”
