At a time when two major political crises are affecting the world, the war in Ukraine following its invasion by Russia and Israel's response to the massacres perpetrated by Hamas, the President of the United States was launching a trade war with an increase in customs duties imposed on all companies exporting to his country. It thus added to the disruption caused by these crises on supply chains an additional uncertainty that was detrimental to household consumption and business investment, and therefore to growth.

In doing so, Donald Trump broke with nearly a century of practices in favour of free trade, which had not been prevented by the Cold War or the numerous financial crises that had hit the world economy. The beneficial effects had been numerous. The competition generated by the opening of borders had benefited consumers' purchasing power by weighing on prices and reducing inflation. They had also benefited from a much wider variety of goods and services offered. Finally, the firms, thanks to the prospect of wider outlets, had been able to achieve productivity gains far greater than those they would have achieved if they had confined themselves to their national market. The combination of all these factors has contributed significantly in the past to growth and thus to employment.

So why this sudden turnaround? The United States has a massive trade deficit that is only partially offset by trade in services. But the globalization that has resulted from trade liberalization has offered the country an essential counterpart. The beneficiary companies reinvested their profits in American assets, which gave a central role to the dollar and made it possible to finance this deficit without any difficulty. Donald Trump's attitude is part of a well-known practice in politics. When something goes wrong, we blame others. France knows this well. The poor results of its economy are blamed on predecessors or employees who are said to be lazy, and not on the mistakes of the current leaders.

The American administration accuses Europe of taking advantage of its market without paying its share of the military expenses necessary for its security, which are financed by its country. Similarly, it blames its Mexican and Canadian neighbours for flooding its economy. But it pretends to ignore the fact that it is mostly American companies that have relocated their production and which, by reducing their costs, have allowed consumers to benefit from better prices. This is even more true for China, since until recently no company in that country was able to supply the U.S. market directly. They were subcontractors of the American and non-American groups that sold their products on this market.

The means chosen to implement the relocation policy is to establish massive customs duties on imported products and negotiate the level with each country or zone concerned, thus putting an end to almost a century of free trade. The method chosen leaves a large part to communication. We multiply the effects of announcements and we don't care about the consequences that this could have if these announcements are not followed up. But it is also part of Donald Trump's culture as a real estate agent. To get a good price when you have found a buyer, you start by offering an excessively high level, even if it means forcing the interested person to raise the threshold he or she was willing to accept in order to complete the transaction.

This is what happened with the European Union, which was naïve enough to engage in negotiations on the basis of the level of tariffs initially announced by Washington, only to be satisfied with the 15% rate agreed, without having a precise list of the sectors actually concerned. Apart from the change from an unenforceable rate to this rate of 15%, we do not see what European countries have gained and this is what the French and German leaders have said. As for the figures for hydrocarbon imports and investments to be made in the United States by European companies, the greatest vagueness persists as to their legal scope because their compliance is highly unlikely, particularly with regard to oil purchases which are often the subject of long-term contracts and the choice of which is the exclusive competence of the companies.

Donald Trump's mistake is to believe that this policy can allow him to achieve his objectives. However, there is a great risk that the opposite will happen. Even if the increase in customs duties can be partly borne by local exporters and distributors, the inflationary effect will be inevitable in addition to the effects of the sharp decline in the dollar since the beginning of the year. The central bank's ability to cut rates, which is insistently demanded, will be reduced by the same amount, which will further slow down already weak growth. The 10-year rate for federal bonds is currently 4.30%, nearly 100 basis points higher than the French rate.

An economic context of slower growth and persistent inflation is not good for investments in relocation or in the restoration of public finances. Corporate strategies do not reverse overnight. Deciding to set up new plants and making them operational takes several years, especially in such a climate of uncertainty. The expected effects of Make America Great Again are likely to be illusory, especially since in the current international context where supply chains are disrupted, the decisions of business leaders will be even more difficult to make.

As for the expected tax revenues from customs duties, it is far from certain that they will be greater than the revenue losses generated by the stagnation of activity. This will increase the country's budgetary fragility because to the 7% deficit of the federal government, we must add the deficits of each state and public institutions. The dollar is an asset. But if protectionist measures as violent as those announced were applied, savers and governments alike could turn away from assets denominated in the US currency. The Tesla precedent, which led many consumers to reject these vehicles because of the positions taken by its founder, may well one day extend to the financial markets.

The last limitation imposed on this policy is the need to import strategic raw materials. The case of Chinese rare earths is revealing and the United States is seeking to conclude an agreement with Beijing, but this time from a position of weakness. The contrast between the strategies of the two countries is striking. Chinese economic diplomacy is based on "win-win" relations, where everyone wins. But who could imagine that Chinese products will one day be taxed less in the United States than those from Mexico or Europe?

The will to power of a head of state cannot be exercised in the long term to the detriment of his people. However, the current trade war will have negative consequences on the American economy and therefore on the population. Public opinion is said to be expressing its dissatisfaction and weighing on voting intentions when the members of the House of Representatives and a third of the Senate are re-elected next year. Donald Trump could then, as he has done many times before, reverse his past choices.