Trade-war optimism may end in tears

Today's Agenda Trump seems fine with tariffs, though they're bad for the economy, his approval ratings and making China change. Uber's IPO was as meh as we feared. Keep the foosball table; give us on-site child care instead. Scaring off smart immigrants is bad economics. Life During Trade Wartime Well, he did it. If you had much money riding on that whole "Trump is just bluffing about tariffs" thing, then you have our condolences. Just after midnight, President Donald Trump boosted tariffs on $200 billion in Chinese imports, even as trade talks continued in Washington. Those discussions accomplished little, and Trump threatened tariffs on the other $325 billion of stuff the U.S. imports from China if negotiations don't bear fruit in a few weeks. Stocks swooned early, thanks partly to a confusing series of presidential tweets, but recovered after negotiators on both sides made optimistic noises. That Steve Mnuchin didn't flip the negotiating table like Theresa Giudice is what passes for good news these days, apparently. The market's boundless optimism may be misplaced, though, as neither Trump nor China seem to mind escalating their conflict, David Fickling writes. Tariffs are probably a short-term political boost for Trump, David writes, which may be why he says he's in "no rush" for a settlement. But tariffs will hammer the U.S. economy too, and Corporate America is far antsier for a deal, write Brooke Sutherland and Sarah Halzack. Most companies have prepared for the higher tariffs Trump imposed last night, but not a full-scale trade war, which would noticeably raise costs for companies and consumers, Brooke and Sarah write. Already Trump's trade hostilities have hurt the very stocks that seemed most likely to benefit from his election, writes Robert Burgess. And any temporary political benefit of a trade war can turn negative very quickly, which is why presidents don't usually attach themselves so eagerly to such gambits, writes Jonathan Bernstein.  Trump may think higher tariffs will break China's resolve, but Andrew Browne warns this analysis is wrong in several ways. Even the most comprehensive agreement will be impossible to enforce, leading to more tension and more destructive tariffs, Andrew notes. A far better approach to changing China's behavior would be to team up with the rest of the world – which shares Trump's complaints about China – to apply steady pressure on the practices that make it such a powerhouse, writes Mihir Sharma. Further Trade-War Reading: Trump will next turn his attention to Europe, which has deftly managed relations with the U.S. and China so far. – Leonid Bershidsky  Stock investors looking for safe haven from trade-war worries are out of luck. – Stephen Gandel Uber IPO Gets Three-Star Rating We warned you yesterday the Uber Technologies Inc. IPO would be worse than a long ride with a chatty driver, and sure enough the most-hyped IPO in a long time priced at $45, the low end of its hoped-for range, and then promptly fell to $42 in early trading. As Shira Ovide points out, everybody who bought the stock privately since December 2015 was immediately underwater: Uber was once the standard-bearer of the "unicorns," private companies worth more than $1 billion. It is now the most famous example of what the cool kids are calling "undercorns," Matt Levine writes. The problem for Uber and its undercorn rival Lyft Inc., Shira writes, is that both face a future in which their days of fastest growth are over, but their days of profits are still in the hazy future – not exactly a tempting combo for investors. Free Child Care > Free Beer Tech companies are famous for their generous perks, but they're usually geared toward the young, childless bros that typically start tech companies: free beer, fancy meals, rock-climbing walls, etc. On-site child care, on the other hand, is in short supply. That sort of perk is expensive, but it would help retain talent, particularly women, and improve productivity, writes Kara Alaimo. Something to think about on Mother's Day weekend (this weekend, for you louts who have forgotten). Telltale Charts Trump is scaring skilled and student immigrants away from the U.S., which is bad not only for the U.S. economy but also the countries from which these immigrants hail, writes Noah Smith.  Sam Adams Boston Lager maker Boston Beer Co. just bought Dogfish Head Brewery in its biggest deal ever. In the bargain it may have gotten a future CEO to steer it through waters trawled by far bigger rivals, writes Tara Lachapelle. Further Reading Trump must be more strategic about Venezuela. Bluster and threats of military action only alienate allies and harden support for Nicolas Maduro. – Bloomberg's editorial board  Breaking up Facebook Inc. sounds satisfying, but it may not solve the problems we want to solve. – Shira Ovide  GOP senators can't ignore the Green New Deal any more. - Liam Denning It's a good time for the ECB to consider a sea change in its approach to policy. – Ferdinando Giugliano  Should the U.K. try out universal basic income? Leonid Bershidsky and Ferdinando Giugliano debate.  Under Mitch McConnell, the Senate has given up even pretending to legislate. – Jonathan Bernstein  Trump's looking for Ukrainian help with the 2020 election; voters should be skeptical of whatever comes of that effort. – Leonid Bershidsky  Good news for Joe Biden and Bernie Sanders, maybe: Humans favor older leaders, particularly in times of stability. – Faye Flam  ICYMI The world's fastest bullet train began tests in Japan. Fake Manhattan socialite Anna Sorokin was sentenced to 4-12 years in prison. Elon Musk is still tweeting. Kickers Bees swarm area woman's car for two days. Cats may be as smart as dogs, says fake science. Air pollution seems to cause dementia. Was Shakespeare a woman? Photos of the week. Note: Please send bees and complaints to Mark Gongloff at mgongloff1@bloomberg.net. New to Bloomberg Opinion Today? Sign up here and follow us on Twitter and Facebook. 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