Trump vows to strike back at European leaders who warned of retaliation for his tariffs

President Donald Trump speaks during a meeting at White House. Photo / AP

In his expanding war over global trade, US President Donald Trump has aimed his harshest rhetoric at an unlikely target - the closest US allies.

In Twitter posts, Trump vowed to strike back at European leaders who said they would retaliate for his promised tariffs on aluminum and steel. "If the EU wants to further increase their already massive tariffs and barriers on US companies doing business there, we will simply apply a Tax on their Cars which freely pour into the US. They make it impossible for our cars (and more) to sell there. Big trade imbalance!"

The country that escaped Trump's tweeting ire was China, the nation the President has wanted to hit hardest and the one that is largely responsible for flooding global markets with cheap steel. China provides just 2 per cent of US steel imports.

Instead, the biggest burden of Trump's new tariffs - 25 per cent on steel and 10 per cent on aluminum - would be borne by Canada, the largest trading partner with the US. The tariffs would also hit the United Kingdom, Germany, South Korea, Turkey and Japan, countries with which the US has extremely close national security ties.

"The President is going to quickly find out that you can't start a trade war with your allies and expect them to work with you on other issues," said Jamie Fly, senior fellow at the German Marshall Fund. "The Administration is squandering the little credibility they had with transatlantic partners at a time when they're asking them to help fix the Iran deal, fight terrorism and increase defence spending. It will not work."

"Allies should not be treated as scapegoats, Mr President," tweeted a German member of European Parliament, Reinhard Bütikofer. "Or is it your goal to make America lonely?"

Inside the White House, aides over the past week have described an air of anxiety and volatility. In an unorthodox presidency in which emotion, impulse and ego often drive events, Trump's shock trade war was one development in which his moods manifested themselves. Others were his zigzagging positions on gun control and his feud with Attorney-General Jeff Sessions.

Yesterday he said he thinks it's great that China's President Xi Jinping now holds that office for life and mused that maybe the US will do the same someday. Trump's remarks came during a luncheon for Republican donors at his South Florida estate. CNN reported the remarks based on a recording it obtained. Trump told the gathering: "He's now president for life. President for life. And he's great. I think it's great. Maybe we'll give that a shot someday."

The trade dispute was opposed by Republican leaders. It caught almost his entire team by surprise. Last week, national economic council director Gary Cohn was telling people he was going to continue stalling Trump on tariffs. "Gary said to him, you can't do this, you can't do that," a senior Administration official said. "The more you tell him that, the more he is going to do what he wants to do."

Trump has promoted his new tariffs as part of an America First plan, but any benefit in terms of jobs could be far outweighed by increased steel costs for the US, in many cases harming some of his own strongest domestic constituencies.