December 17, 2018

The Trump Trade Strategy Is Coming Into Focus. That Doesn’t Necessarily Mean It Will Work.

“We are talking to the European Union again, we are talking to Japan again, and we are moving to what I have characterized as a trade coalition of the willing to confront China,” Mr. Kudlow said. (He didn’t note that he’d borrowed a term also used for the allies that joined in the 2003 invasion of Iraq, which President Trump has called a disaster.)

The sense among analysts that the administration has been pursuing a single coherent strategy contrasts with earlier in the year. At that point, from the outside at least, the administration seemed to be changing its approach by the week, and sometimes by the day. It has often seemed that there has been a series of improvised moves, with different senior officials favoring different approaches.

Steel and aluminum tariffs were to be applied to all imports, then close allies were exempted, until two months later when they weren’t.

There seemed to be a deal to increase Chinese imports of American agricultural and energy products, achieving trade peace — which crumbled days later, as President Trump changed course and demanded more profound changes in the Chinese economy and trade practices.

Now, with the new North American deal, it’s become easier to see how the different elements of Trump trade fit together. The “nonmarket” provision seems devised to give the United States veto power over any deal Canada or Mexico might seek with China.

But just because there is a more coherent strategy in the administration’s stance toward global trade than in the recent past doesn’t mean it will work. And there are still plenty of reasons for skepticism.

“I do think we can see a strategy, but that doesn’t mean it’s a good strategy,” said Mary E. Lovely, a professor at Syracuse University and a fellow at the Peterson Institute for International Economics. “They’re going to use these bilateral deals to strong-arm countries into lining up behind the U.S. on China. But when we get there, what’s the next step? I don’t know what the endgame is.”

Article source: https://www.nytimes.com/2018/10/06/upshot/trump-trade-strategy-coming-into-focus.html?partner=rss&emc=rss

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