WSJ What’s News
Surrender or Resist? The Dilemma Facing Allies Caught in Trump’s Trade War
Wed, 26 Mar 2025
P.M. Edition for Mar. 26. When confronted with President Trump’s plan to impose tariffs, governments are still figuring out how best to respond. Canada correspondent Vipal Monga walks us through the strategies they have chosen, and how they might play out in the long term. Plus, Trump is set to announce his plans for tariffs on the automotive industry. And the Atlantic magazine has published more screenshots of the cabinet members’ Signal chat. WSJ national security reporter Alex Ward analyzes the texts and the Trump administration’s response. Alex Ossola hosts. An Annotated Analysis of Signal Group Chat With Top Trump Officials Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What are the key highlights from the Trump administration's group chat?
What we learned from the new Trump team's war chat text that The Atlantic has released. Plus, the president is set to announce his plans for tariffs on the automotive industry. And when confronted with Trump's tariffs, U.S. allies face a choice. Agree to his demands or fight back.
It's a game of psychology at this point. People are just trying to read Trump because I think everyone realizes in the end that despite the people around him, the only guy who makes a decision is Trump ultimately. So they are trying to use whatever levers they think work with this very complicated man.
Chapter 2: What are Trump's new automotive tariff plans?
It's Wednesday, March 26th. I'm Alex Osola for The Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today. President Trump is set to announce later today tariffs on automobiles.
The tariffs are expected to be narrower than the administration once envisioned and are expected to apply to finished vehicles coming into the U.S., but not automotive parts. Trump said for months that he would impose reciprocal tariffs on April 2nd that would equalize U.S. tariffs with those other countries' charge.
But he has suggested in recent days that some countries might not be subject to duties equal to what they charge. An administration official said the White House is considering a plan that would offer nations some lenience. Later in the show, we'll talk about the dilemma facing governments on the receiving end of U.S. tariffs. The news about the U.S.
automotive tariff plans weighed on stocks, with automaker shares coming under pressure. General Motors and Stellantis have been among the hardest hit, though Ford Motor has held up better. Meanwhile, new data out today showed that durable goods orders rose 0.9 percent in February, blowing past expectations for a 1 percent decline. That wasn't enough to keep major U.S. indexes afloat today.
Chapter 3: How are U.S. stock markets reacting to Trump's tariff announcements?
The Dow fell about 0.3 percent, the S&P 500 dipped about 1.1 percent, and the Nasdaq ended the day down about 2 percent. The Atlantic magazine has released more texts from the Signal Group chat with Trump administration cabinet members in which editor-in-chief Jeffrey Goldberg was accidentally included.
The texts show that Defense Secretary Pete Hegseth posted plans for the timing and weapons to be used in a military strike against Houthi militants at least two hours before the bombs were scheduled to drop. Testifying before Congress today, U.S. National Intelligence Director Tulsi Gabbard denied that the information shared in the chat was classified.
Chapter 4: What was revealed in the Signal Group chat with Trump officials?
The conversation was candid and sensitive. But as the president and national security advisor stated, no classified information was shared. There were no sources, methods, locations, or war plans that were shared.
For more on the texts and their implications, I'm joined by national security reporter Alex Ward. So Alex, what did we learn from these texts that were released today?
Oh, oh, so much. There were attack plans discussed in this chain. Defense Secretary Pete Hegseth basically said, look, guys, these fighter jets are leaving at this time. They might bomb at this specific time. And then National Security Advisor Mike Waltz, he said, hey, we've found out that actually one of these targets was successfully eliminated, a.k.a. killed.
Chapter 5: Is the information in the Signal Group chat classified?
This is the kind of conversation you have in the secure rooms of the Pentagon. In the Situation Room of the White House. You do not have this on Signal, which is an unclassified venue and it's publicly available and it's on unclassified phones that. presumably people can hack and get access to.
So let's talk about this designation of classified because there's already been quite a lot of debate about this. Tulsi Gabbard, as we just heard, as well as other members of the administration, have said the information shared in this Signal Group chat was not classified. Would information like this that was shared that we have screenshots for normally be classified?
Literally any former official who's dealt with this from any administration, Republican or Democrat, would tell you this is classified information. It strains credulity that this was at any point unclassified. There's also guidance from the Office of the Director of National Intelligence, the office that Tulsi Gabbard leads, from September of 2024.
Chapter 6: Who might face consequences from the Signal Group chat leak?
which basically provides guidance as to how one should classify information. And it could not be clearer that information about ongoing future current attacks need to be designated at least at the top secret level. So that is classified. The complication here is the secretary of defense does have the authority to declassify classified information.
But it's very unlikely that Hegseth did that in order to post it in the signal chat. And when asked about it during his trip to the Indo-Pacific region, did not answer that question directly. He was given a chance to say, yes, I declassified it. And he did not say that. And so now the administration's argument is all about, well, the Atlantic reported it was war plans and these were attack plans.
Attack plans are arguably more sensitive because you're literally being specific down to the unit level. So when the administration says, well, actually, these weren't war plans. These were attack plans. What they're really saying is it's not bad. It's worse.
What happens next?
Right now, there are calls for heads to roll here. You know, Mike Waltz has been in the crosshairs for being the one to start the group and put Jeffrey Goldberg into it. But now it seems like attention is turning toward Hegseth because he is the one that did put in the allegedly classified information.
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Chapter 7: How are U.S. allies responding to Trump's trade war?
But Trump loves Hegseth and is seen by many as kind of one of the closest top aides that Trump has. And so it's hard to believe Trump would let him go. Also, that would necessitate another Senate confirmation fight to replace him. Whereas, say, if they were to fire Waltz, they would not need a Senate confirmation fight because that position is not Senate confirmable.
That was national security reporter Alex Ward. And the journal has broken down the text between the White House officials. You can find an annotated analysis of the group chat text on WSJ.com. We'll leave a link in the show notes. Coming up, are countries fighting back against Trump's tariffs making more headway with the president than those that don't retaliate? That's after the break.
President Trump's trade war is forcing America's closest allies to choose between fighting back or acquiescing. The trouble is nobody's figured out which is the best way to get Trump to do what they want. The Trump administration plans to move forward with a list of what the president calls reciprocal tariffs on April 2nd, a date Trump has called Liberation Day. Should U.S.
allies agree to Trump's demands or fight back? Vipal Munga is our Canada correspondent and joins me now from Toronto. Vipal, how are U.S. allies approaching this dilemma?
So Canada has taken a very strong position against the tariffs. They've immediately come out of the gate and said they're going to retaliate dollar for dollar. And they're specifically trying to target red states that they feel will hurt Republicans and get those Republicans to talk to Trump and get him to back off. The European Union also has decided to go for retaliatory tariffs.
And they're making the same calculation as Canada to some extent. They think that Trump is a bully and bullies don't particularly respect people who roll over. So you've got to hit back. Punch him in the mouth is the attitude. And it's early to say whether that works or not. We do know that he's a very emotional leader. And when people do retaliate, he has not reacted well in the past.
Okay, so that's the fight back approach. Let's talk about the softer approach.
So Mexico also has a lot at stake, in theory as much at stake as Canada does. But Mexico has decided not to retaliate for now. President Claudia Sheinbaum, she's very forceful with Trump apparently in the calls, but extremely respectful when they talk.
And they've decided not to hit back in the hopes that what they're creating is an environment where Trump goes easier on them when he finally comes out with his full slate of tariffs.
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