Brutal tariff warning no Aussie wants to hear

There are warnings Australia could be hit with hefty tariffs after a move from Anthony Albanese which has raised ire in Donald Trump’s team.

Australia could be hit with hefty US tariffs because of its radical crackdown on social media giants, experts have warned.

On Thursday, Prime Minister Anthony Albanese’s government introduced world-first legislation into parliament to ban social media for kids under 16 which is believed to have broad bipartisan support.

Officials and diplomats now fear that with X owner Elon Musk primed for a plum position in president-elect Donald Trump’s administration, Australia could be punished with onerous tariffs.

Mr Musk, set to head a new department of government efficiency, has already let his thoughts on the ban known, slamming the move within hours of the bill being tabled.

“Seems like a backdoor way to control access to the internet by all Australians,” the billionaire wrote on X, in response to Prime Minister Albanese’s triumphant post about the proposed ban.

There are warnings the US could impose tariffs on Australia. Picture: Handout / ANDINA / AFP

If passed, social media companies could be slapped with fines of up to $50 million if they fail to do enough to verify a user’s age on their platforms.

The changes will impact social platforms like TikTok, Facebook, Instagram, Reddit and X, but YouTube will be exempt.

Snapchat is also expected to be captured in the definition of social media under Australian law after some discussions.

Mr Albanese has likened the ban to age restrictions on alcohol, acknowledging people can get around it but arguing that it sets a standard.

The laws would come into force 12 months after passing and the eSafety commissioner would be responsible for enforcing the legislation.

However it has now emerged that US officials and Australian diplomats are now concerned this will make it harder for Australia to secure exemptions to US tariffs.

Last year, Australia exported $33 billion of exports to the US.

“It would be more of a concern for Trump because of his ties to tech,” one person told The Australian Financial Review on condition of anonymity.

X CEO Elon Musk jumps on stage as he joins then Presidential candidate Donald Trump during a campaign rally. Picture: Jim Watson/AFP

Mr Trump rubbed shoulders with the tech elite of the US in the lead-up to the election, especially Elon Musk, and other tech areas like cryptocurrency in his ‘Make money great again’ movement.

The president-elect also owns his own platform, Truth Social, after he was blocked from using mainstream social media for his spreading of fake news and incitement.

It comes after Australia introduced similar world-first rules in 2021 under then-Prime Minister Scott Morrison to force tech giants into a media bargaining code where they would pay news outlets.

Meta has since abandoned the deal completely.

Australia is pushing for more plans to make tech giants like Meta come to the party again.

In October, a Labor-led parliamentary suggested a levy Meta and Google to fund local journalism.

Trump appoints tariff tsar

Overnight, Mr Trump has named billionaire Scott Bessent as his Treasury secretary, choosing the hedge fund manager to help execute an agenda promising tax cuts and tariffs.

Mr Bessent, who is chief executive officer of Key Square Group, has called for an extension of tax cuts from Trump’s first term, wants to reassert American energy dominance, and believes it is necessary to deal with the budget deficit.

“Scott is widely respected as one of the world’s foremost international investors and geopolitical and economic strategists,” Mr Trump said in a statement.

“He will help me usher in a new Golden Age for the United States, as we fortify our position as the world’s leading economy,” he said, adding Bessent would also help “reinvigorate the private sector, and help curb the unsustainable path of federal debt.”

Scott Bessent is the head of Key Square Group and former chief investment officer of Soros Fund Management. Picture: Drew Angerer / Getty Images North America / AFP

US President-elect Donald Trump has made another cabinet pick. Picture: Brandon Bell / Getty Images North America/ AFP

The nomination of Mr Bessent — who recently served as an economic advisor to Mr Trump — would put him at the forefront of rolling out the president-elect’s economic plan, from seeing tax cuts through Congress to managing ties with countries like China.

The position carries influence over both domestic and international policy.

With Mr Trump promising sweeping tariffs on allies and adversaries alike, all eyes will be on how his new Treasury chief walks the line between supporting these efforts and fanning trade tensions that might roil the global economy.

The Treasury Department has oversight across a range of departments, from federal finances to bank supervision. The portfolio also oversees US sanctions.

Bessent has in recent times called for tax reform and deregulation to spur growth.

In a Wall Street Journal opinion piece, he said this would be key to “restarting the American growth engine” and helping keep prices in check.

‘All-in’ for Trump

He has also defended Mr Trump’s position on trade, saying on Trump ally Roger Stone’s radio show that the president-elect wants free trade but “we haven’t had fair trade, we haven’t had reciprocal trade.”

This month, Mr Bessent called tariffs “a negotiating tool with our trading partners” in an opinion piece for Fox News, adding that it was “a means to finally stand up for Americans.”

Mr Bessent, who is from South Carolina, attended Yale University and served as chief investment officer of Soros Fund Management, the macroeconomic investment firm of billionaire George Soros.

In 2015, he raised capital, including $2 billion from Mr Soros, to start his own hedge fund.

In his interview with Stone, Bessent said that he has known the Trump family for 30 years and was friends with the president-elect’s brother.

“I was all-in for President Trump. I was one of the few Wall Street people backing him,” he told Stone.

Ominous tariff sign for China

In an ominous economic sign for China this week, Mr Trump also nominated Howard Lutnick, the co-chair of his transition team, as his commerce secretary — a choice set to bring a tougher stance on Beijing from the incoming administration.

Mr Lutnick will also lead the country’s tariff and trade agenda, with “additional direct responsibility for the Office of the United States Trade Representative,” Mr Trump said in a statement.

Tariffs are a key part of Trump’s economic agenda and he has promised sweeping duties on all imports when he returns to the White House.

Mr Lutnick is chief executive of financial services firm Cantor Fitzgerald and a Trump ally originally tipped as a front-runner for treasury secretary.

But he was instead named to helm Commerce, a smaller department that works to boost American industry and has a key role in policy to shore up the US semiconductor sector and reduce reliance on Asia.

Under President Joe Biden, the Commerce Department stepped up export controls on critical technologies like quantum computing and semiconductor manufacturing goods, taking aim at access by adversaries like Beijing.

China could be hit with huge tariffs. Picture: Greg Baker / AFP

Mr Trump’s administration could harden this stance.

Mr Lutnick has expressed support for a tariff level of 60 per cent on Chinese goods alongside a 10 percent tariff on all other imports.

Both are among proposals that Mr Trump has floated, with the Republican taking aim at countries which have been “ripping us off for years.”

In Mr Trump’s first term he engaged in a tariffs war with China, with the US Trade Representative’s office issuing duties on imports from the world’s second-biggest economy.

Mr Lutnick also previously lamented the loss of manufacturing jobs in the United States and offshoring to China.

“I’m all in with Donald Trump,” Mr Lutnick told podcaster Anthony Pompliano last month.

In the same interview, he slammed electric cars as “coastal elite nonsense” and blamed China for being the source of fentanyl in the United States.

The deadly drug, many times more powerful than heroin, is responsible for tens of thousands of overdose deaths a year.

“China is attacking America from its guts,” he charged.

Crypto support

Mr Lutnick was initially tipped to head the Treasury Department but a tussle over the position spilled into the public eye last weekend.

Mr Trump’s health secretary pick Robert F. Kennedy Jr. expressed support for Lutnick, saying on social media that “Bitcoin will have no stronger advocate” than him.

The world’s richest man Mr Musk also threw his support behind Mr Lutnick for Treasury chief while calling the other top contender, hedge fund manager Scott Bessent, “a business-as-usual choice.”

“Business-as-usual is driving America bankrupt, so we need change one way or another,” said Mr Musk, who Mr Trump has tapped to lead a new Department of Government Efficiency.

Mr Lutnick recalls losing hundreds of employees in the 9/11 attacks on the World Trade Center, a tragedy narrowly he avoided as he was taking his son to school.

Besides Cantor Fitzgerald, Mr Lutnick heads financial technology firm BGC Group and real estate services firm Newmark Group.

He graduated from Haverford College and has a degree in economics, according to his biography on Cantor’s website.

As co-chair of Mr Trump’s transition team, Lutnick has been identifying new hires for the president-elect’s administration