Donald Trump just laid another risky global bet – escalating a trade war with China by imposing additional tariffs on Chinese goods in the midst of ongoing trade talks – and neither he nor anyone else can be sure of what happens next.
The sharp escalation could rattle investors and is the latest manifestation of the building superpower conflict across the Pacific. It will stoke new concern about the President’s unapologetically unpredictable statesmanship.
The confrontation comes at a time when anxiety is already growing over Trump’s stewardship of several other foreign policy crises, including with Iran, North Korea and Venezuela.
The US imposed new tariffs on a further $200 billion in Chinese goods following a midnight deadline and after the President accused Beijing of backtracking on a deal between the world’s two largest economies.
It’s possible that the gambit could work as negotiators from the two sides are meeting again in Washington on Friday. But the fear will be that the US and China are now heading for a prolonged showdown that could hurt the world economy.
Trump said on Friday that there was no rush to reach a deal since tariffs of up to 25% were now “being paid” on some of China’s exports to the US.
“Tariffs will bring in FAR MORE wealth to our country than even a phenomenal deal of the traditional kind,” Trump tweeted.
It is true that raised duties could dampen demand for Chinese goods, but it is American shoppers who end up paying the costs of higher tariffs.
Trump’s tactic reflects his belief that the strong US economy gives him leeway to inflict pain on China’s products, workers and consumers and will force its leaders to back down and make fresh concessions.
It’s a classic move from a former real estate tycoon who preaches the art of the deal, often raises the stakes at the last minute and says he is always ready to walk away from the table.
But the new tariff hike is sure to draw reprisals from China, barring an overtime deal on Friday, that could rebound against the President and US consumers – especially in the agricultural and industrial heartlands of the Midwest.
The China showdown has been building for months, like the other current foreign policy dramas, does not come as a sudden surprise.
Trump has been complaining about China’s economic practices and the Sino-US trade deficit for decades – since long before he became a politician, and it’s possible to draw a line between his latest move and the 2016 campaign when he accused Beijing of “raping” US workers.
Presidents reap what they sow in foreign policy, even if it takes time for initial decisions made early in their terms to reshape the world.
But the bill may be becoming due for Trump’s unorthodox style.
The President often treats foreign policy as an extension of his wild, unpredictable character that abhors restraints, has little appreciation for history and lives in the moment. He says he’s the master deal maker, but he’s more of a destroyer than a builder on the world stage.
He loves splashy headlines, defying the wisdom of diplomatic sages, the spotlight of one-on-one summits, jabbing allies and using tyrants as pen pals.
He enjoys wielding a big stick but doesn’t want to get into foreign quagmires. He disdains long-thought-out strategies, hates global organizations and doesn’t sweat details.
The current dramas have all been exacerbated by the President’s shoot-from-the-lip interventions and his tendency to reject traditional diplomatic practice.
He has, for example, never ruled out military action in Venezuela – as unlikely as that seems – after a US-backed effort to overthrow the government of Nicolas Maduro fizzled in recent weeks and left White House policy in disarray.
While accusing Xi Jinping’s government of moving the goalposts in trade talks, he praised the Chinese leader for sending him a “beautiful letter,” easing investor fears after markets dipped into a two-day Trump-initiated nosedive.
Trump has also sent contradictory signals to Iran and North Korea, leaving US strategy opaque, contributing to uncertainty – never a desirable state of affairs in geopolitics.
Foreign diplomats say Trump’s impulsive style makes it almost impossible to predict American policy – a factor that is adding to global instability.
Often, Trump seems to be placating a slice of his domestic base rather than playing diplomatic chess.
His policy on China emerged from a hardcore campaign message about Beijing’s trade policies.
His synthesis of Israel policy with Prime Minister Benjamin Netanyahu’s right-wing coalition is often seen as a play for US evangelical voters.
His denunciations of Maduro’s socialism mirror his 2020 campaign attacks on progressive Democrats.
In many cases Trump’s policies are contradictory: He is trying to kill a nuclear deal with Iran while attempting to reach another with North Korea.
And there are increasing indications that US strategies, especially toward Iran and Venezuela, are being directed by national security adviser John Bolton, who has a long history of support for militaristic and regime change solutions.
Trump, who hates it when his subordinates steal his thunder, shot down that idea on Thursday.
“He has strong views on things, but that’s OK. I actually temper John, which is pretty amazing isn’t it?” the President said.
A slide to war with Iran?
The US withdrawal from the Obama administration’s international Iran nuclear deal fit all the requirements of Trump foreign policy.
It let him take a swipe at his predecessor. It was hugely popular in the GOP. And it created a headline and angered US allies, encapsulating Trump’s “America First” philosophy.
But the consequences of the decision are becoming clear in a sudden escalation of tensions that has raised fears that the US and the Islamic Republic are locked into a slide to war.
Trump’s maximum-pressure strategy of punishing economic sanctions and directly targeting Iran’s clerical rulers is regime change in all but name.
Iran is now threatening to withdraw from aspects of the nuclear deal, possibly to pressure European nations who are still signed up, to force them to do more to mitigate the pain of US sanctions – including an effort to eradicate Iran’s oil exports.
As part of a policy that is seen as the brainchild of Bolton – an Iran hawk – the administration sent an aircraft carrier strike force, along with some heavy bombers, to the region this week.
Secretary of State Mike Pompeo ditched talks with German Chancellor Angela Merkel to dash to Baghdad for meetings with Iraqi officials, citing yet-to-be-released intelligence that had raised concerns Tehran could target US troops or facilities.
Pompeo cranked up the pressure yet again on Thursday.
“We do not seek war. But Iran’s forty years of killing American soldiers, attacking American facilities and taking American hostages is a constant reminder that we must defend ourselves,” Pompeo said in a statement.
The sudden activity and administration messaging about what it calls “Iran’s expansionist policy” have led some observers to compare the strategy to the Bush administration’s march to war with Iraq.
Brian Hook, the US special representative for Iran, told CNN’s Wolf Blitzer that Trump wanted to force Tehran to change its behavior.
“We need to restore deterrence against Iran’s regional aggressions,” he said.
But as the last two decades have shown, Washington’s sense of its own power to shape events in the Middle East is often disastrously exaggerated. And its perceptions of how adversaries interpret its pressure are often wrong. It’s not clear that Trump’s team has learned that lesson yet.
Obama’s Iran deal halted Tehran’s uranium-enriching centrifuges, freezing the breakout time to a nuclear weapon and postponing a US decision on military action that could destabilize an already shattered region and shock the world economy.
All that now seems back on the table.
“I think there are increasing risks of collision between us and the Iranians,” William Burns, a retired US senior diplomat, told CNN’s Kate Bolduan on Thursday.
“The Trump administration is making a very risky bet. That is that you make coercive diplomacy work when it is all about coercion and not very much at all about diplomacy.”
“You are relying on maximum pressure but not connecting it, as far as I can see, to either realistic aims or any channels of diplomatic communication,” he said.
Trump offered a hint Thursday that his hard line was designed to force Iran to negotiate a better deal – encompassing its missile program and what the US says is malign regional activity.
“They should call, and if they do, we’re open to talk to them,” Trump said. But since the US strategy appears to hinge on Iranian capitulation, it is unclear why Tehran would pick up the phone.
Which is why many experts fear what will happen next.
Not yet taking Kim’s bait
Kim Jong Un is getting antsy.
A rising drumbeat of short-range missile tests and the suspension of cooperation with US efforts to find the remains of soldiers killed in North Korea nearly 70 years ago are beginning to erode the meager payoff Trump forged with his stunning engagement of one of the world’s most brutal tyrants.
Kim’s impatience looks like a classic North Korean tantrum following the failure of his second summit with Trump in Vietnam earlier this year.
Trump’s rationale is that after decades of failed US diplomacy, his personal connection with Kim can prompt a historic breakthrough.
Yet after offering Kim the concession of two face-to-face meetings, there has been no progress toward denuclearizing the Korean Peninsula.
The impasse is putting Trump’s strategy, which went from warning of “fire and fury” to declaring that he and Kim fell in love, under intense scrutiny.
But Trump is also not taking Kim’s latest bait – a sign that his gullibility revealed in their first summit in Singapore last year might be less of a factor.
“What appears to be happening is North Korea is testing the United States, trying to push them towards some sort of negotiation, reopening the talks,” Amy Pope, a former senior Obama administration official, said Thursday on CNN.
“The President is right not to kowtow to that and to accept that as an appropriate way of negotiating, but at the same time there is a more serious question that undergirds all of this.
“What is the President’s strategy on North Korea? What is the diplomatic negotiating going into it behind the scenes?”
Trump is seeking to keep his channel to Kim open, but the fear is that the North Korean leader will further escalate tensions if he does not get the economic concessions he seeks.
If he goes back to long-range missile tests or nuclear detonations, the prospect of a horrific war on the peninsula could quickly return.
“Nobody’s happy about it, but we are taking a good look and we’ll see,” Trump said when asked about missile tests overseen by Kim this week.
As for the future: “We will see what happens.”