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Illustration: Lazaro Gamio/Axios

The CEOs of IBM, JPMorgan and Cummins, the major engine manufacturer, have a gloomy outlook on what’s ahead for U.S. business if President Trump doesn’t back down on tariffs.

Why it matters: The executives said at a Business Roundtable event Wednesday that conflict with China is prompting decisions with long-term consequences — like how to shift supply chains — and the effects may show up in the economy, as companies rein in plans for spending and hiring.

  • Tom Linebarger, CEO of Cummins: "The taxes from tariffs have now outgrown the benefits from the tax reform act. Our net taxes are higher."
  • Jamie Dimon of JPMorgan Chase: "I think the biggest self-inflicted risk to growth today would be trade going south."
  • Ginni Rometty, IBM CEO: The "biggest risk, generally speaking, for businesses is when there is too much uncertainty."

Details: Cummins has already sacrificed business because of trade tensions between the U.S. and China, plus the company is reeling from uncertainty as the USMCA — the proposed replacement for NAFTA — hangs in the balance.

  • "We export a small number of engines from China, and we could not find a new source for those," Linebarger said. "We essentially lost that business."

The backdrop: The trade war is ramping up at a time when the juice from the tax cuts looks to be fading and the economic cycle is feared to be nearing an end.

  • Per Quartz, Cummins will take a $150 million hit from the tariffs on an annualized basis which would wipe out the company’s gains from the tax cut, Shannon Kiely Heider, the company’s director for international government relations, said.

What they're saying:

  • Linebarger: "In some cases, we have tried to find suppliers outside of China that can supply us the same goods, because it's been sustained long enough that we can find new suppliers. The biggest challenge with finding new supply locations is it takes time."
  • Rometty: "For us it did not make a change. It was just re-insuring where we had different and multiple sources."

What's next? The CEOs are not looking to the G20 Summit in Japan in late June as a watershed moment.

  • "I don't think anyone expects [a deal with China] by June 29," when Trump and Chinese President Xi Jinping are set to meet at the gathering of the world's leaders, Dimon says.
  • "We don't see the G20 as any kind of milestone other than, of course, I hope the two meet and talk and keep their relationship open," Linebarger says.

Go deeper: Business "freak out" spurs plans to tame Trump on trade

Go deeper

Vaccine hesitancy drops, but with partisan divide

Illustration: Sarah Grillo/Axios

69% of the public intends to get a COVID vaccine or already has, up significantly from 60% in November, according to a report out Friday from the Pew Research Center.

Yes, but: The issue has become even more partisan, with 56% of Republicans who say they want or have already received a coronavirus vaccine compared to 83% of Democrats.

Ben Geman, author of Generate
46 mins ago - Energy & Environment

China's 5-year plan is hazy on climate

Illustration: Sarah Grillo/Axios

China's highly anticipated 5-year plan revealed on Friday provides little new information about its climate initiatives, leaving plenty to discuss in multinational meetings this year and lots of blanks for China to fill in later.

Driving the news: The top-line targets for 2025, per state media, aim to lower energy intensity by 13.5% and carbon emissions intensity by 18% — that is, measures of energy use and emissions relative to economic output.

Vaccine dreams juice jobs report

Data: FRED; Chart: Axios Visuals

Good news for your Friday: the economy added a whopping 379,000 jobs in February — far outpacing expectations.

Why it matters: Virus cases eased in recent weeks and states lifted restrictions, helping fuel a hiring surge. It's proof of how much control the pandemic has over the job market.