The flags of the United States and China fly from a lamppost
Joe Biden is betting the tariffs will help build a domestic supply chain in areas like clean tech and electric vehicles, and bring the US industrial base to life while shielding it from cheap Chinese imports © REUTERS

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Good morning and happy Thursday! Today we’re chatting about:

  • The tariff race is on

  • Ray Dalio’s election warning

  • The latest inflation data

The 2024 election battle has a new front: tariffs.

Joe Biden and Donald Trump are racing to prove who is tougher on US trade with China, and thus who is the fiercer defender of working class jobs.

As the president announced on Tuesday that he would slap new tariffs on $18bn worth of Chinese goods, he was probably hoping that voters in the Rust Belt swing states of Pennsylvania, Michigan and Wisconsin were paying close attention [free to read]. Trade matters a lot to blue-collar workers in these states, and this is a demographic bloc that both presidential contenders are vying to win over.

“My predecessor promised to increase American exports and boost manufacturing. But he didn’t [do] either. He failed,” Biden said. The Biden administration said the new tariffs would protect large manufacturing investments from Chinese competition.

For his part, Trump has said he’ll hit all Chinese goods with tariffs of at least 60 per cent should he make it back into the Oval Office.

In case you need a refresher, Trump launched a trade war against Beijing the year after he took office, targeting $300bn in Chinese goods. Biden has kept those in place and is now setting his sights on more strategic industries — such as clean energy, semiconductors and metals — with his levies, even though he was critical of his predecessor’s trade war. He once said they were in effect a penalty on US consumers.

But tensions with Beijing flared during Biden’s tenure, so he ultimately embraced Trump’s protectionist approach. And there is, of course, the matter of re-election.

Biden has made the industrialisation of the US economy a cornerstone of his presidency, and he needs to make sure that union workers in former industrial powerhouses are behind him. He’s betting the tariffs will help build out a domestic supply chain in areas like clean tech and electric vehicle making, and bring the US industrial base to life while shielding it from cheap Chinese imports.

Campaign clips: the latest election headlines

A split image with Joe Biden, left, and Donald Trump, right
CNN said it would host the primetime debate between Joe Biden and Donald Trump in its Atlanta studios © AP
  • Biden has asserted executive privilege over the recording of his interview with the special counsel investigating his handling of classified documents, blocking the audio from House Republicans. (WSJ)

  • Biden and Trump are set to debate on June 27 on CNN, marking a break from the traditional calendar. They’ll also be without the customary live audience. 

  • The Inflation Reduction Act, has created a $47bn market to spur the US energy transition while letting corporations lower their tax bills; American football star Travis Kelce is among those joining in [free to read].

  • Polling shows Biden has particularly weak support in Nevada, where his messages are not resonating with Latino voters. (NYT) 

  • Speaker of the House Mike Johnson and other Republican allies showed up to court to support Trump at his “hush money” trial in New York.

Behind the scenes

Ray Dalio, the billionaire founder of hedge fund Bridgewater Associates, thinks this is the most important US presidential election in his lifetime.

He told the FT’s Kate Duguid that it could exacerbate political polarisation to the point of bringing on a type of “civil war” — not necessarily an armed conflict, but one in which “people move to different states that are more aligned with what they want and they don’t follow the decisions of federal authorities of the opposite political persuasion.”

The finance giant said the election would test the health of US democracy. Though Dalio declined to back a candidate, this is how he’s thinking about the options: 

Trump will follow more rightist, nationalistic, isolationist, protectionist, non-regulatory policies — and more aggressive policies to fight enemies internally and externally, including political enemies. 

Biden, and even more so the Democratic Party without Biden, will be more the opposite, though they too will play political hardball.

He did, however, reveal that he recently attended a Taylor Swift concert. “She brought people of all sorts — and many nationalities — together,” he explained.

“I say this partly as a joke, but if she ran for president and would listen to great advisers, I’d consider supporting her.”


Much to the delight of the Biden administration, data released yesterday showed that headline inflation ticked down in April.

The consumer price index showed that inflation fell to 3.4 per cent last month from 3.5 per cent in March. It was the first time this year that CPI did not come in higher than expected.

After the CPI reading, traders increased their bets that the US Federal Reserve will cut interest rates this year. A cut before the election could be good for Biden, whose re-election bid has been dogged by persistently high inflation.

The monthly FT-Michigan Ross poll has shown voters’ continued frustration with inflation this year. Eighty per cent of voters polled this month said high prices were one of their biggest financial challenges.

But the latest reading is still unlikely to completely assuage voters’ concerns.

Wednesday’s “inflation number will be seen by some as progress and by others as a sign that inflation is still a problem. It probably is not good enough news for the Biden campaign but it could have been a lot worse,” said Erik Gordon, a professor at the University of Michigan’s Ross School of Business.


  • The Democratic and Republican parties are in a race to see who can deglobalise fastest, writes Edward Luce.

  • Biden’s China tariffs are more bark than bite, Amanda Chu says in today’s Energy Source newsletter [available for Premium subscribers].

  • The 2024 presidential race is officially a climate election now, declared Bill McKibben. (The New Yorker)

  • Tej Parikh has a critical question: “What even is inflation?” he asks in Alphaville. He goes on to explain the difference between CPI and personal consumption expenditures, the Fed’s preferred inflation metric.

Have your say

Joe Biden vs Donald Trump: tell us how the 2024 US election will affect you

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