The Memo: Trump keeps friends and foes guessing on trade

Where is President Trump’s trade policy going?

That was the question being asked in Washington and beyond after the president offered conciliatory remarks in a Wednesday news conference and then returned to a harder rhetorical line while visiting an Illinois steel plant on Thursday.

{mosads}Trump seemed to de-escalate from the growing threat of an all-out trade war with Europe when he spoke Wednesday alongside European Commission President Jean-Claude Juncker in the White House Rose Garden.

But by the following afternoon, Trump was insisting that “we’re putting the world’s trade cheaters on notice.”

The president’s improvisational style makes it next to impossible to guess where he goes next — something that could be a problem for everyone from American workers to foreign investors.

“It’s become a Trump negotiating trait to issue lots of threats and then suddenly turn on a dime and sound like he has reached a truce,” said Robert Litan, a non-resident senior fellow at the Brookings Institution.

“China and NAFTA, by the way, are two huge warning signs that he certainly hasn’t ended the trade war even if he makes nice with Europe. And all they did was agree to talk more. There is no deal!” Litan added.

Trump made his protectionist instincts clear on the campaign trail in 2016. But he has come under criticism even from members of his own party since he announced new tariffs on steel and aluminum imports in March.

Those criticisms have grown louder as retaliatory tariffs have been unveiled. The effects have already begun to bite — and November’s midterm elections are drawing closer.

After the administration earlier this week announced $12 billon in aid to farmers affected by trade tensions with China and other nations, Sen. Ron Johnson (R-Wis.) complained, “This is becoming more and more like a Soviet-type of economy here.” 

Sen. Ben Sasse (R-Neb.) also blasted the administration’s move, saying, “This trade war is cutting the legs out from under farmers, and the White House’s ‘plan’ is to spend $12 billion on gold crutches.”

Earlier this month, Sen. Bob Corker (R-Tenn.) said that he was “very concerned about the president’s trade policies and I think we all should be.”  

Alex Conant, a Republican strategist who worked for Sen. Marco Rubio (R-Fla.) during the 2016 GOP presidential primaries, told The Hill that Trump has “very little support within the Republican Party for these tariffs.”

Conant said the disapproval was partly rooted in the traditional Republican ideological support for free trade, but also because of the more immediate dangers posed to the party’s chances in the midterms.

“The more Trump talks about tariffs, the harder it is going to be for our candidates,” said Conant. “Tariffs risk undermining the economic growth that is so important to Republicans’ reelection this fall.”

The details of what had been agreed between Trump and Juncker on Wednesday were vague. But the president did make clear that he was willing to hold off on new tariffs he had threatened on automobiles. He also promised that eventually the U.S. and EU could “resolve the steel and aluminum tariff issues.”

Supporters of the president insist there was no backsliding going on.

Commerce Secretary Wilbur Ross told reporters aboard Air Force One on Thursday that the outlines of the deal announced with Juncker amounted to “a real vindication” of Trump’s approach and that without the threat of auto tariffs, “we never would have gotten to the point where we are now.”

Former White House communications director Anthony Scaramucci told The Hill that the apparent shift in tone from Trump was, far from caving to pressure, evidence of the president’s deal-making instincts.

“The president has great commercial instincts and recognizes that our trading partners are coming around to his view. As always he has impeccable timing,” Scaramucci insisted. “He knows he is going to get what he thinks is fair for the American people, so it’s time to deal.”

But others attributed the president’s apparent shift to pressure that had been brought to bear both from within his own party and from voters.

“I think that for the last couple of months you have seen quite a bit of pushback, not only from Congress but from the American people,” said Tori Whiting, lead trade economist at the Heritage Foundation, a conservative group.

For now, however, no one seems confident of how to decipher Trump’s latest moves. 

One school of thought is that he is using fiery language to hide the fact that he is looking for an exit ramp from escalating trade tensions.

Another thesis holds that the European “agreement” was nothing more than a temporary blip in his broader, nationalistic approach.

“I think he believes that free trade is bad and will continue to pursue protectionist policies,” said Conant. 

The Juncker meeting, Conant added, “was a nod to the political realities. But I don’t think he has given up on his protectionist agenda.”

The Memo is a reported column by Niall Stanage, primarily focused on Donald Trump’s presidency.