ANALYSIS
As the world reeled from his tariffs, Trump discovered the limits of power
U.S. President Donald Trump speaks as he signs executive orders in the Oval Office of the White House on April 9, in Washington.THE ASSOCIATED PRESS
On vivid display in only a handful of days this month is a lesson of the capacity of unilateral power to affect the globe’s trading system – and of the limits of power that Donald Trump has discovered as the world reacted to his imposition of tariffs.
That power was on display as retailers, importers, Wall Street and Bay Street traders, central bankers, car dealers and grocery shoppers reacted with anger, fear and customer and portfolio losses. The limits of power was evident as stocks tumbled, politicians fumed and Trump advisers feuded.
The result was another act of conciliation – a 90-day moratorium on some retaliatory tariffs, accompanied by 10-per-cent duties – that voided, or at least ameliorated, the shots at many American trading partners that were heard round the world.
Another result may – it is a fool’s error to guess – either enhance or diminish the American president’s power, his prerogatives and his profile.
On the one hand, he boosted duties on goods from China. That asserted the trade discretion that he has seized from Congress and in defiance of the constitutional powers on trade that the legislative branch were given by the country’s 18th century founders.
At the same time, he backed away from what he assured the press and public were part of a thoughtfully developed and carefully evaluated master plan for American prosperity that might produce short-term pain, but would assure long-term economic growth and a renaissance of the country’s manufacturing base – a base that he considered congruent with his political base.
Opinion: Did anyone even ask for Trump’s bonkers economic policies?
Mr. Trump and his subalterns vowed repeatedly that the President would not bend from his “Liberation Day” declaration of stiff global tariffs a week ago. But by backing away yet again – he did so earlier with Canada and Mexico, only to change course – he showed the capriciousness that is part of his power.
Moreover, he put on display the incongruity that seemed to emerge between the bright future of stability he promised and the short-term instability of the markets, and of the administration.
In a sense, the decisiveness that came with the tariffs has been replaced by the indecisiveness that came with Wednesday’s backtracking.
“This kind of uncertainty will continue to be a challenge to business and trading partners,” Susan Schwab, the country’s chief trading negotiator in the George W. Bush administration, said in an interview. “This is a period of rapid and, now, unexpected change. This is not going to be resolved anytime soon.”
All this raised substantial questions, not only about the path forward, but also about the workings of the administration.
Was the 90-day pause a recognition of the influence of financial markets on a President reared in New York and part of a circle of people whose outlook was shaped by the peregrinations of Wall Street?
Who is prevailing in administration debates? The free-traders such as Elon Musk, the architect of the administration’s war on federal workers, or the cadre of tariff boosters led by Peter Navarro, the high priest of protectionism?
Is the second Trump administration a mirror of the first, when the President was swayed by the last person who beseeched him, or does he act with his own gyroscope, which for four decades has pointed him toward a romance with tariffs?
The answer to all of these questions is: Yes.
Which only underlines that the President’s views, while strongly worded, may not be strongly held. And it underlines how dangerous it may be for stock and bond traders, let alone consumers contemplating a new flat-screen television, to take Wednesday’s enthusiastic cries of “Yes!” – the reaction of those whose fondest hopes were answered when the President backed away from the draconian duties – for a final answer.
At about the same time as the White House announced its action, the respected Quinnipiac University national poll was released, showing that about three-quarters of American voters think the tariffs will hurt the U.S. economy – and that about half believe they will injure the country’s economy in the long term.
In his years as Canada’s ambassador to Washington, Allan Gotlieb, the Winnipeg intellectual and diplomat, was the first to express what has become a commonplace in the American capital: In Washington, nothing is ever final, and even if it looks as if it is final, it is not.
Mr. Gotlieb, who served during the Reagan administration, never would have imagined that his aphorism would apply this closely, at this much controversy and cost. He was thinking about negotiations on softwood lumber, not broad tariffs.
Mr. Trump has assaulted virtually every element of conventional thought and practice in fewer than 80 days in office: that courts have the final word in legal disputes; that government officials cannot be removed from their positions without cause; that long-time allies cannot be treated harshly; that the institutions American statesmen helped create after the Second World War to provide stability to the world should not be toyed with; and that Russia is at best an unreliable partner and at worst an unforgiving rival.
But what the President has tested in his first months in office is one of the cardinal rules of international relations: A superpower must behave with subtlety as to its manoeuvres, with transparency as to its ultimate goals and with consistency as to its actions.
The maxim that prevailed when Britain ruled the seas and much of the world, and when the American ascendancy began and matured, can be summarized in three words: Stability above all. In Mr. Trump’s world, and thus in the world at large, that no longer applies.
Sign up for our redesigned Morning Update newsletter.
Start your day with context and insight on the biggest stories shaping our lives, written by Danielle Groen
