Toddler-in-Chief pitches new fit, proving to partners he cannot be placated

(Originally published July 14 in “What in the World“) Economists are bracing for further headwinds as Trump lashes U.S. consumers with arbitrary new tariffs.

Trump has already imposed a 10% tariff on all imports, with a tariff of at least 30% on imports from China, and a 50% tariff on imported aluminum, steel, and as of Aug. 1, copper. He has extended his April threat to impose “reciprocal” tariffs on goods from individual nations that don’t reach their own trade deals with his administration—from an original deadline of July 9 to Aug. 1. But in the past week he has threatened to impose a 35% tariff on Canadian imports, 50% on Brazilian imports like coffee, and 30% on imports from both the European Union and from Mexico.

That growth (and the stock market) hasn’t already cratered is being laid to two factors. First, consumers and businesses have been stocking up ahead of tariffs. And second: thanks to the “TACO trade,” the uncertainty about where Trump may finally land has been turned from a negative into a positive, with investors and companies focusing on tariffs already in place, rather than those Trump may threaten. Trump’s tariffs so far are bad, but nowhere near as bad as the ones he threatened. So, glass half full?

Trump, for his part, is interpreting the stock market’s rally as an endorsement of his negotiating tactics. But Trump’s infantile caprice has also made it virtually impossible for trading partners to determine whether it’s possible to reach a deal with Trump and, if so, what kind of deal that might be. After promising 200 trade deals, he has so far sealed only 2.5: one with the United Kingdom (which has a trade deficit with the U.S.), one with Vietnam, and what can best be called a ceasefire with China. Faced with increasing odds of failure, the rest of America’s trading partners are instead working on contingencies and devising ways to live without the U.S. in the global trading order.