Looking for logic in Trump’s tariffs is a fool’s errand

When President Trump summoned the media to the White House Rose Garden on April 2, he dubbed it “Liberation Day.” America’s trade deficit, Trump’s executive order declared, represented “an unusual and extraordinary threat to the national security and economy of the United States” and a “national emergency.”

First, Trump imposed sweeping tariffs on foreign imports. He set out — indeed, brandished on placards, like a protectionist gameshow host — a list of countries and their various tariffs. These were calculated on a basis so convoluted and confused that a random number generator would have given more economic insight. Our ally Taiwan received a 32 percent tariff, whereas the Taliban-run Afghanistan got only 10 percent.

The result was predictable. The markets posted their biggest single-day drop since the COVID-19 pandemic. Companies delayed share launches and other countries responded with retaliatory import duties. Speaker of the House Mike Johnson (R-La.) chose a line many Republicans favored, declaring confidently that the tariff regime “may be rocky in the beginning. But I think that this will make sense for Americans and help all Americans.”

Give me prosperity, oh Lord — but not yet!

Two days later, hours after the new tariffs had taken effect, Trump announced that he would pause many of them for 90 days. He hiked the rate on Chinese goods to a nonsensical 125 percent but retained only the initial uniform 10 percent on most other countries. The implication was clear: You have three months to address what the president sees as an unfair system.

This temporary ceasefire has allowed the media an attempt at analysis. The same questions are asked again and again, from every conceivable angle: Why has Trump paused the tariffs? What does this tell us about his real or long-term objectives? How did he choose his targets? Who will deliver the most outlandishly shameless obeisance in order to be restored to favor?

All of these attempts to understand Trump’s tariffs are based on a category error. They are looking for the underlying logic and strategy in a policy which is not logical or strategic. This is a matter of faith.

Trump is not generally regarded as a deep political thinker. He does not read books, does not debate or explore ideas, and does not see actions or events as part of a consequential chain. On one issue, however, he has been clear and consistent for nearly 40 years: tariffs. In 1987, he took out full-page advertisements in the New York Times, the Washington Post and the Boston Globe to decry the way Japan and other countries had been “taking advantage of the United States,” exploiting access to America’s markets and causing trade deficits.

The economics did not — do not — matter. Trump does not believe in the concept of mutual benefit that Adam Smith hardwired into free-market economics. He sees a starkly Manichean world of profit and loss, winners and losers.

For him it is axiomatic that if a country is profitably trading with the U.S., then the U.S. must by the same token be losing, and must be the submissive partner in the bilateral exchange. A trade deficit is proof of this, so they, as the result and evidence of weakness and failure, must be eliminated.

In fact, trade deficits have no inherent virtue or vice. They can be the sign of a prosperous domestic economy with high demand, giving consumers more choice and better value, and they can stimulate growth and provide employment. Equally they can challenge domestic manufacturers and lead to foreign control of industry. But any study of, say, the Japanese economy after World War II will tell you that trade surpluses are not a reliable indicator of prosperity either, and the idea that America would have a perfectly even trade balance with every other country is plainly absurd.

All of that tells us nothing about what Trump will do next. Because he sees deficits through a prism of faith rather than reason, it is impossible to look at what he has done previously to imagine future steps. As a predictive exercise, it is like trying to interpret the shapes of clouds: it will only make sense if you see things that are not there.

This may be frustrating, but it is better to admit that the president’s next move is, to paraphrase another Donald, not so much a known unknown as an unknowable unknown.

Eliot Wilson is a freelance writer on politics and international affairs and the co-founder of Pivot Point Group. He was senior official in the U.K. House of Commons from 2005 to 2016, including serving as a clerk of the Defence Committee and secretary of the U.K. delegation to the NATO Parliamentary Assembly.