Back on “Liberation Day” when Trump announced his tariffs one the planet, Australia got a 10% tariff – the lowest of anyone.

So why might this now increase?

Other than Trump seeming to think 15% is a better number (and truly there might not be anything more to it than that – maybe he shot 15 on one of the holes he played in Scotland the other day) the big issue is pharmaceuticals.

Pharmaceutical companies make an absolute killing (in every sense of the word) in America, because its health system is essentially privatised extorsion.

They would like to do this everywhere else. The problem being that the EU, UK, Japan and Australia have much better health systems and as a result we pay less for our medicines.

How much less do we pay? Matt Grudnoff did a great report earlier this year outlining the price differences – and they are massive:

As you can see, in some cases Americans pay more than 100 times more than we do. This is why their health insurance costs so much and also why they are effectively held hostage by their jobs because losing health coverage is the difference between living and dying or at best bankruptcy.

Now Trump knows that getting lower drug prices in the US would be a huge win.

So his solution?

He wants everywhere else – including Australia – to allow drug companies to charge more so that in return those same companies will promise to charge Americans less.

The way he is trying to make that happen is to threaten everywhere else with high tariffs on all things if they don’t change their systems (like the PBS) to allow higher drug prices.

Now if you can see some flaws in this plan, you are rather more intelligent than anyone in the White House right now.

There is absolutely NO WAY the govt will do anything to weaken the PBS.

About the only way the govt could lose the next election is to weaken the PBS. The ALP knows this. The LNP knows this.

Any political party that weakens the PBS could kiss goodbye to being in govt for a generation.

There are not many fights the ALP will take with Trump – certainly not on AUKUS. But on the PBS is will gladly do so, and if Trump goes through with his threat, expect a Canadian-style response here.

Most people don’t care too much about international trade policy (I mean, just think about The Phantom Menace), but Trump trying to destroy the PBS will get people boycotting USA goods very quickly.