Trump's tariff threat is another con game

It's meant to make him be perceived as having wins--and to distract--and media is playing along. They need to call it out.

Donald Trump's tariff threats are proving to be mostly empty, a risky game in which he accepts cosmetic changes from foreign governments that humor him. He then claims concessions that are big—when they’re not —and calls it a win. Much of the media goes along.

And he will do it again and again until they call out his bullshit.

Trump has talked about tariffs as absolutely necessary for his new “Golden Age”—though after “some pain.” He presents them as a cure-all to raise huge amounts of money (even though consumers pay for them). So it makes no sense for him to call them off by getting some minor things from countries—or nothing dressed up as something—that do not raise huge amounts of money.

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This week, once again, Trump threatened tariffs against other countries only to stop them before they went into effect. Almost two weeks ago it was Colombia with 50% tariffs. And this week it was Canada and Mexico. He let 10% tariffs against China go into effect, but tariffs on Chinese products have been in effect for years, including through Joe Biden’s presidency, as it is not an ally of the U.S., and is competing in reckless ways. The tariffs on China, at least previously, were strategically targeting specific industries and products.

And Trump had no way to back out of the threatened tariffs on China—which are stupid because they’re on all goods, not specific industries—with even a fig leaf of a win because China, unlike Mexico and Canada, didn’t give him any meeting before they went into effect in which it could humor Trump and allow him to save face.

China just waited for the tariffs to go into effect, and then retaliated with tariffs on liquefied natural gas, coal, farm machinery and other products, and it launched an investigation of Google. So much for Google and the tech companies sucking up to Trump. He just sold them out to China!

There will surely be economic ramifications from the tariffs on China but it will be nothing near the hugely detrimental impact of the 25% tariffs on Mexico and Canada which caused markets to plunge yesterday—until Trump halted the tariffs from going into effect (“paused” for a month) after speaking with the leaders of Canada and Mexico. He likely wanted the same outcome with China, but didn’t get it.

Trump’s tariffs, first off, are illegal. Congress must pass a law putting tariffs in place, at it did at the time of the Great Depression—when they caused severe economic decline to worsen.

Trump used “emergency powers” of the president to tariff the countries this week, saying it was a national security issue because of the fentanyl crisis and immigration. But there is not an emergency, so this is bogus—and illegal.

But even if Trump was using fentanyl smuggling as a cover to use emergency powers, that doesn’t take away the fact that he loves tariffs and doesn’t seem to get that tariffs are passed from companies onto consumers. During the election campaign he vowed 20% tariffs or higher on all goods coming into the U.S. He said that tariffs would lead to the end of the federal income tax. He said that tariffs would fund child care programs. He’s said there’s a trade deficit that causes the US to “subsidize” Canada and Mexico, and thus tariffs would end it.

As the Associated Press points out, Trump has been all over the place on tariffs:

But even if the orders are focused on illegal drugs, Trump’s own remarks have often been more about his perceived sense that foreign countries are ripping off the United States by running trade surpluses. On Sunday, Trump said that tariffs would come soon on countries in the European Union. He has discussed tariffs as both a diplomatic tool on national security issues, a way to raise revenues and a vehicle for renegotiating existing trade pacts.

Trump claimed it as a win—and media went along with it—when Mexico said it would send 10,000 troops to the border. The problem with that is that Mexico regularly sends that many troops to the border. Mexico has 400,000 troops. In 2019 the government sent 15,000 troops to the border and in 2021 Mexico sent 10,000 troops to the border. In addition, Mexican President Claudia Sheinbaum got Trump to agree to do something about illegal weapons from the U.S. smuggled into Mexico (not that he will actually do anything.) She’s being praised for how she’s handled it all.

Prime Minister Justin Trudeau of Canada basically agreed to do what he announced in December, in a 2024 year end review. So it was nothing new. Trudeau also said he’s name a “fentanyl czar”—taking a page from Trump to make him happy—and giving some minor cosmetic changes to Trump to point to as a win.

In other words, Trump got very little in return for “pausing” the tariffs. And the big question is: Why would be pause them if the whole idea is to make a lot of money?

The answer is likely that Trump was, as a caller to my SiriusXM show pointed out, tipping his toe in the water on massive tariffs, something he’s been obsessed about. And the loud reaction on Wall Street—and among Republican politicians and millions of Americans—scared him. The focus on rising prices and the jolt to the economy made Trump blink.

Canada and Mexico had every reason to help him to save face, as it was in their best interests to end this quickly. China obviously took a different tack, but it is also a much more dominant economy and not about to play any game with Trump. China was likely hoping Trump would go ahead with the Mexico and Canada tariffs, as it stood to gain a lot as our allies would move toward China.

All of this showed Trump to be weak, and also a fraud. You can’t tell us tariffs are the cure-all and then pull back every time you are set to impose them. And even if you’re doing it to get other countries to take some action, you can’t settle for this weak tea.

Paul Krugman and others have noted that Trump folded. He completely caved when he saw that Mexico and Canada retaliated—rather than bowing to him—and that world markets tumbled as Republicans fretted. And that’s how the media should be covering it, calling Trump’s bluff and exposing his con game.