Trump Decides Trade War Is Back On, Will Slap Tariffs On Europe, Canada, Mexico And Then In Two Weeks, China

At a certain point, I guess all you can do is throw up your hands.

There for a couple of weeks it looked like Donald Trump might be actively trying to deescalate global trade tensions, presumably thinking he had made his point and/or that months of tough talk was enough to convince the Roseanne constituency that his pretensions to dealmaking prowess are based in reality.

But things have taken a turn for the Navarro dark side over the past 48 hours.

Apparently, the President thinks the concessions Steve Mnuchin won from China aren’t sufficient when it comes to claiming he successfully fought nefarious foreign interests on behalf of flyover ‘Murica, so now, he’s going to go ahead and actually impose those metals tariffs that have been hanging in limbo for the last month. Here’s WaPo:

President Trump plans to announce as soon as Thursday the imposition of sweeping tariffs on steel and aluminum imports from Canada, Mexico, and the European Union, three people familiar with the plan said.

Frustrated over the failure of those U.S. trading partners to agree to a range of demands, the president chose to sharply escalate his global trade war rather than grant further tariff waivers.

The import taxes could take effect as soon as Friday.

The move is likely to have an immediate impact on global trade in steel and aluminum, particularly between the United States and Canada, the nation’s largest source of imported steel.

That comes hours after WSJ first reported that the EU waivers were unlikely to be extended…

The Trump administration, unable to win concessions from European Union counterparts ahead of a Friday deadline, is planning to make good on its threat to impose tariffs on European steel and aluminum, people familiar with the matter said.

The administration is expected to make an announcement as early as Thursday.

The move, which has been threatened for months, is almost certain to draw a response from the EU, which has threatened to retaliate with its own tariffs on such American products as motorcycles, jeans and bourbon.

…and just a day after Trump did what appears to be an about-face on China, which he now says will indeed be hit with tariffs on $50 billion worth of goods starting in roughly two weeks, despite the tentative deal Mnuchin struck with Chinese Vice Premier Liu.

That move not only contradicts Mnuchin’s public comments about the trade war being “on hold” (a characterization that was also undermined explicitly by Peter Navarro in an NPR interview today), but also effectively renders Wilbur Ross’s planned trip to Beijing pointless.

“If you’re trying to send signals, you’ve completely muddied this and nobody knows what signal you’re sending,” former Treasury Department official Phil Levy told Politico on Wednesday.

Speaking of Wilbur, he pissed everyone off on Tuesday with an Op-Ed for FT that blasts the E.U.’s GDPR push as something that could “significantly interrupt transatlantic cooperation and create unnecessary barriers to trade.”

Not to put too fine a point on it there Wilbur, but if you had to single out one thing that “significantly interrupt[s] transatlantic cooperation and create[s] unnecessary barriers to trade”, it wouldn’t be GDPR. In fact, it wouldn’t be a “thing” at all. It would be a person and that person’s nom de hush money is “David Dennison”.

As WaPo goes on to note in the same piece linked above, “Ross has had several discussions with E.U. Trade Commissioner Cecilia Malmstrom over the steel and aluminum tariffs [and] she told the European Parliament Tuesday that ‘realistically’ it did not appear that Europe could escape new U.S. trade restrictions.”

Apparently not. And apparently Canada and Mexico aren’t going to “escape” them either which means the intractable NAFTA talks just became even more intractable.

And then there’s the whole ZTE debacle and the recent threat of auto tariffs.

Obviously, this is a train wreck and seems to suggest (again) that there is no actual “plan” here and that Trump is just waffling back and forth depending on his perception of public opinion. When he thinks he might have gone too far, he’s inclined to side with Mnuchin while ostracizing Navarro and then when he reads enough headlines with the words “Trump” and “Caves” next to each other, he careens abruptly back to the Navarro camp. Here’s the New York Times:

Mr. Trump’s reversal was yet another twist in a long-running ideological battle in the West Wing between economic nationalists, who channel Mr. Trump’s protectionist instincts, and more mainstream advisers like Mr. Mnuchin, who worry that tariffs and investment restrictions will hurt the stock market and hobble long-term growth.

[…]

Mr. Trump’s handling of a Chinese telecom company, ZTE, became another flash point. On Friday, he said he had reached a deal that would allow the firm, which was recently banned from buying American components as punishment for violating United States sanctions, to remain in business. That prompted a slew of criticism from lawmakers that he was backing off his tougher promises on trade and letting a Chinese telecom company that did business with Iran and North Korea off the hook.

“Yes they have a deal in mind. It is a great deal… for #ZTE & China,” Senator Marco Rubio, Republican of Florida, said in a tweet.

Senator Chuck Schumer of New York, the Democratic leader, tweeted, “If the administration goes through with this reported deal, President Trump would be helping make China great again.”

Those swipes rankled Mr. Trump, according to current and former White House officials. In a midterm election year, they said, the president does not want to leave an opening to Democrats on trade. Mr. Trump expressed his unhappiness to Mr. Mnuchin, who had urged him to settle the ZTE issue and seek a trade truce with Beijing.

“There may be some momentary confusion, but his default position is, you’ll never get to the right of him on China,” said Stephen K. Bannon, who served as Mr. Trump’s chief strategist and is a leader of the nationalist movement.

Ahhh yes, Steve Bannon, disgraced bigot who suffered a stunning fall from grace late last year after comments he made about Trump Jr. (made public by author Michael Wolff) prompted a scathing rejoinder from Trump and after he refused to distance himself from accused pedophile Roy Moore (who managed to lose Alabama to a Democrat much to the chagrin of the GOP).

You might recall that ol’ Steve was out earlier this month bemoaning the trade truce with China. “Trump changed the dynamic regarding China but in one weekend Secretary Mnuchin has given it away,” Bannon told Bloomberg, in an interview.

That is obviously bullshit, which should come as no surprise because you know, consider the source. It also echoes the divide in Trump’s inner circle between Mnuchin and Peter Navarro, who was reportedly sidelined from negotiations with Chinese Vice Premier Liu for his behavior in Beijing.

Basically, folks like Bannon and Navarro don’t want to solve problems. They want to create problems that didn’t exist or, if they did exist, exaggerate their effect on middle America and lay all of the blame at the feet of foreigners in an effort to bolster a nationalist message and push a poisonous agenda. When someone like Mnuchin attempts to pacify the voters who have been duped by this bullshit, it rubs folks like Bannon and Navarro the wrong way because if you solve the problem, you can’t continually use it to whip people into a frenzy or, in Navarro’s case, use it to make a name for yourself and sell books.

This leads invariably to ambiguity as to whether Trump has “caved” to trading partners or actually scored some points by securing concessions.

And so here we are, facing renewed trade tensions.

Meanwhile, at Bannon’s home office…