New Delhi, April 15 -- The first salvo of the ongoing trade war was fired by US President Donald Trump on 2 April. The office of the United States Trade Representative (USTR) subsequently released a small note to explain the basis on which reciprocal tariffs had been imposed on various trade partners. The formula used was severely criticized by trade economists for its lack of any basis in either theory or past empirical work.

It is worth going back to that note two weeks later, over which Trump has shifted course after a sharp reaction in financial markets saw US bond yields rise while the dollar lost value.

There are two statements in the USTR note that make for interesting reading a fortnight later. First, it says that the US governm...