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Bulletins and News Discussion from January 27th to February 2nd, 2025 - Tariffs in Trump's Imperium - COTW: Colombia

Image is of Colombian President Gustavo Petro giving a speech at the UN in 2022.

Trump has arrived in office with the force of an avalanche; ending slowing a genocide on the one hand, while simultaneously promising a total nightmare for minorities and the poor throughout and outside the United States on the other hand. [edited for clarity; I do not actually think Trump has ended the Palestinian genocide obviously, I was making a joke - but the ceasefire is a genuine improvement in conditions for millions of people right now who are on the edge of death, so it cannot be dismissed]

It's still far too early to truly compare and contrast his imperial strategy with Biden's, but initial signs show that there does appear to be somewhat of a reorientation. Biden was famous for being two-faced; ostensibly offering aid and stability, while also blowing up your pipeline to ensure you did not actually have an alternative to his idea. Trump, meanwhile, seems only really capable of aggression, threatening several "allied" nations with what may as well be sanctions because of the economic harm they'd do. I suspect we'll be debating for a long time how much of this can be attributed to the specific characteristics of Trump, or whether he merely embodies the zeitgeist of imperial decline - a wounded empire lashing out with extreme violence to try and convince everybody, including themselves, that they can still be the world imperialist hegemon.

I'll admit it: I did not believe that Trump would actually try and go ahead with putting tariffs on basically anybody who annoys him. And while the threat could still be empty in regards to countries like China and Canada, Colombia is the first indication of the potential of his strategy. Despite some fiery words from President Petro, after Trump's administration revealed the punishment if Colombia did not agree, it appears that Colombia will in fact be accepting deported migrants after all. It's funny how that works.

Last week's thread is here. The Imperialism Reading Group is here.

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  • via FT

    Donald Trump lashes out at Federal Reserve after central bank keeps rates steady

    US president had called on the central bank to sharply reduce borrowing costs

    Donald Trump sharply criticised the Federal Reserve just hours after the US central bank defied the president’s calls for deep reductions in borrowing costs and left interest rates on hold. The central bank on Wednesday kept its main interest rate at 4.25 per cent to 4.5 per cent and indicated it was now on pause, with Fed chair Jay Powell saying US rate-setters “do not need to be in a hurry to adjust our policy stance”. Trump railed against the central bank on his Truth Social messaging platform, saying, “If the Fed had spent less time on [diversity, equity and inclusion], gender ideology, ‘green’ energy, and fake climate change, Inflation would never have been a problem”. The Fed’s unanimous decision on Wednesday to hold interest rates came just days after Trump insisted borrowing costs should fall “a lot” and vowed to “let it be known” if he disagreed with the central bank’s decision. The Federal Open Market Committee, the central bank’s policy-setting panel, said in its decision that US inflation remained “somewhat elevated” and removed an earlier reference noting “progress” towards hitting its 2 per cent goal. Powell later clarified the changes reflected a “cleaning-up exercise” rather than a shift in policy. The Fed’s statement “tilts a little bit hawkish”, said Sarah House, senior economist at Wells Fargo. “This is a Fed that is less worried about the state of the labour market.”

    The pause followed three consecutive cuts — including a 0.5 percentage point move in September — that took the federal funds target range down from a 23-year high of 5.25 per cent to 5.5 per cent. Powell signalled interest rates would remain on hold until the committee had more time to assess how Trump’s pledges to raise trade barriers, slash taxes and red tape, and undertake mass deportations would affect its efforts to cool inflation. The Fed chair said the new administration’s policies were “not for us to criticise, or to praise”. He also refused to react to Trump’s calls for the Fed to reduce borrowing costs significantly, saying he was “not going to have any response or comment on what the president said” and that there had been no contact between him and the White House since the new president took office. Eswar Prasad, a professor at Cornell University, said: “This rate decision, which was really the only viable choice the Fed had at this juncture, will cue the political pressure. The coming months will be extraordinarily challenging for the Fed if inflation stays sticky above its target level even as Trump piles on intense pressure to cut rates and bring down borrowing costs.” US markets broadly took the Fed’s decision in stride, with government bonds coming under moderate selling pressure. The policy-sensitive two-year Treasury yield was 0.03 percentage points higher at 4.23 per cent by the late afternoon in New York, while the benchmark 10-year yield was flat at 4.55 per cent. Yields rise as prices fall. In equity markets, the S&P 500 was 0.5 per cent lower. The technology-heavy Nasdaq Composite was down by a similar margin, after trimming some of its losses during Powell’s press conference.

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