Trump’s Trade Strategy, an analysis by Paul, a reader of the Wentworth Report.
- Trump’s objective is to wrest control of global economics away from China, for the economic benefit of the USA. He also wants to encourage China to denuclearize the Korean Peninsula.
- The US military are worried about the integrity of supply and quality control on steel and aluminum in military hardware.
- The US is currently renegotiating NAFTA with Canada & Mexico. NAFTA is being used by China as a backdoor into the US market, trans-shipping steel to these countries for use in cars and other products bound for the US.
- Trump announces the introduction of a global tariff on all imports of steel and aluminum products.
- The usual suspects go crazy about an impending trade war, with doom-mongering to rival Chicken Little.
- The media saturates broadcasts with a “WH in Chaos” narrative.
- Economic Advisor Gary Cohn resigns — shock, horror!
- Allies complain loudly, asking for exemptions from the tariffs.
- A magnanimous Trump graciously concedes to US allies and NAFTA partners, provided trans-shipment by evildoers is prohibited.
- US allies claim a great victory for their lobbying efforts.
- NAFTA is renegotiated to prevent trans-shipment, making the US the official inspector to determine if steel and aluminum is of suitable quality and free of Chinese product.
- China, with 50% of the global steel output and a softening economy, can’t dump product into the USA or elsewhere as US allies are forewarned and on guard.
- Chairman Xi, to improve access to the critical US consumer market, tells North Korea they must denuclearize.
- US and allies win, win, win.
We are now up to stage 9. Evidence of this plan can be gleaned from the Cabinet meeting prior to the tariff announcement during. We saw warm thanks given to Gary Cohn (likely driving media insane), trolling of Democrats with comments about Elon Musk re-usable rockets (“How can we both like Elon?”), and a very explicit statement about exempting Australia from tariffs.
At the end of the 20 minutes the media were allowed to film we see Secretary ‘Mad Dog’ Mattis (Defence) clinking glasses with Secretary Ross (Commerce) to toast the success so far. This interaction defines the objective and explains the strategy.