Trump's Love for American Industry: First Tariffs, Now an End to Wall Street's largest Tech Deal...

DawgStreet's picture
Rank: Orangutan | banana points 324

International competition and trade policy seem to be a very relevant in today's politics.

Earlier last week

Trump announced that he will be placing tariffs on steel and aluminum imports, hoping that it would facilitate US steel and aluminum. This is in addition to the tariffs on solar panels from a couple of months ago.

Today

On a related note, Trump has ordered an end to Broadcom's bid to acquire Qualcomm, citing "national-security concerns" that seem to reflect US-Chinese competition:

"The proposed takeover of Qualcomm by the Purchaser is prohibited, and any substantially equivalent merger, acquisition, or takeover, whether effected directly or indirectly, is also prohibited," says the presidential order, signed by Mr. Trump.

Broadcom, which has a reputation as a cost-cutting behemoth, would stymie research and development at Qualcomm, the San Diego-based chip maker, and weaken it against foreign rivals racing to develop next-generation wireless technology, such as China's Huawei Technologies Co.

"Given well-known U.S. national security concerns about Huawei and other Chinese telecommunications companies, a shift to Chinese dominance in 5G would have substantial negative national security consequences for the United States,"

And this is not the first time this issue has come up either. The US seems to be wary of Chinese influence when it comes to US-based industry:

In one recent precedent, President Donald Trump in September blocked Chinese government-backed Canyon Bridge Capital Partners' attempt to buy Portland, Ore.-based Lattice Semiconductor Corp.

Trump's recent political actions seem to be a direct reflection of his "America First" stance on international trade/competition. Lucky for us, Trump is a businessman AND a patriot.

Do you think Trump blocking the Broadcom/Qualcomm merger was a good call?

Do you agree with his stance on foreign trade and competition?

Sources: WSJ, CNBC

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Mar 12, 2018