When Donald Trump imposed tariffs mainly targeted at China, he also slapped them on friendly nations. This move was widely panned. In fact, steel and aluminum are in global oversupply, reflecting a variety of hidden subsidies even from democratic allies. And if we want to keep domestic industries at all, steel and aluminum need relief.

What to do? In his recent announcement, Biden got it just right.

The deal ends the current tariffs, of 25 percent on European steel and 10 percent on aluminum—but only on exports that stay below historical levels. Any exports over 3.3 million metric tons of steel annually will still pay the tariffs. In return, the Europeans ended retaliatory tariffs against U.S. exports of several products, including orange juice, bourbon, and motorcycles.

The deal also opens the door to a general agreement to manage global oversupply, and to penalize countries that use dirty modes of production. Exports from China, which produces about half the world’s steel, mostly using coking coal, will still incur the tariffs.

At a press conference with the European Commission president, Ursula von der Leyen, Biden said that the deal would "restrict access to our markets for dirty steel from countries like China, and counter countries that dumped steel in our markets, hammering our workers."

This deal did not just happen. It was the result of long-overdue revisions in U.S. assumptions about free trade and industrial policies, and careful diplomacy led by the U.S. trade rep, Katherine Tai.

After decades of globalist self-delusion under both parties, and four years of strategically incoherent nationalism under Trump, the U.S. now embraces effective managed trade. And our government acknowledges that key domestic industries and their workers need to stay in the game. Europe, which has long had a more nuanced view of trade and industrial policy, actually welcomes this shift.

Well done.