Like a dog to a bone, Donald Trump always returns to tariffs. He is now proposing a modified list of them on a range of countries, including close allies and a number of desperately poor nations, to be imposed on August 1 2025. Will he chicken out, yet again? Who knows? But the chances that he will, or indeed could, get deals able to assuage his irrational mercantilism seem low to non-existent. An irrational man is unpredictable. Maybe this time he means it. If so, May’s already high average US effective tariff level of 8.8 per cent would end up much higher. We would enter a new world.

Glance at just some of what is being proposed: tariffs of 50 per cent on imports from Brazil, 40 per cent on Laos and Myanmar, 36 per cent on Thailand, 35 per cent on Bangladesh, 32 per cent on Indonesia, 30 per cent on South Africa, Sri Lanka and the EU, and 25 per cent on Japan and South Korea. The proposed tariffs are still quite close to those suggested by the extraordinary formula put forward on April 2 2025, in which the determining factor is the ratio of the US bilateral deficit to bilateral imports. (See charts.)

It cannot be said too often that this is nonsensical economics. There is absolutely no reason why bilateral trade should balance. The fact that it does not do so certainly does not show that the surplus country is “cheating”.