This morning, the White House announced that trade talks with China continue, albeit at a staff level. This came after a flurry of reports that Trump is planning to unilaterally ramp back the embargo-level tariffs he imposed on China earlier this month, advance notice that cheered Wall Street. Then Chinese officials said that the White House is wrong. There actually are no talks. And Trump must take the first step, unilaterally undoing the tariffs he had already imposed.
He appears set to do just that.
This comes just three days after the CEOs of Walmart, Target and Home Depot met with Trump at the White House and reportedly told him that his tariffs would result in empty shelves and product shortages in as little as two weeks.
All of this is, to put it mildly, a humiliating climb down for the President. He upended the global economy and seems to have massively damaged the perception of American assets as a safe haven during times of economic uncertainty. The goal was to go toe-to-toe with China and see China blink. But it’s the U.S. that’s blinking. And that’s after the earlier reciprocal tariffs blink that already happened.
The White House had hailed bilateral trade negotiations with Japan as soon to lead to a deal, one that might serve as a model for other bilateral deals. But those talks ended with no agreement. New elections in Japan likely play some role in how things ended. But the big issue seems to be that Japan found Trump’s terms unacceptable and beyond that had a hard time elucidating even what the administration’s actual position was. At the risk of stating the obvious, Trump’s strong-arm tactics are failing, even as his damaging tariffs mostly remain in place. He looks weak. He picked fights and now he’s caving.
One big problem with Trump’s strategy has always been that you can’t prevent foreign governments from seeing what’s happening in public within the United States. Trump’s tariffs are really, really unpopular. He can rely on the Republican Congress not to pull his authority to impose them — though even that seems to have required Trump’s earlier climb-down on reciprocal tariffs. But there’s what is happening in the open and there’s what’s happening behind closed doors. Pretty much the entire business community — Wall Street and Main Street — is against the tariffs. Congressional Republicans are tolerating them more than supporting them. If you’re from another country, you probably look at this and say, “Let’s hold tight. He probably can’t sustain this.” There’s an additional factor: Since the target countries see themselves as unfairly attacked, the tariff war has tended to unite their polities while dividing ours. So that reaction is right: he probably can’t sustain it. And as we’re seeing today, he’s not.
It may seem unrelated. But something happened in the Supreme Court’s latest engagement with Trump. By a 7-2 vote SCOTUS ordered the White House not to allow a new batch of detainees to be rendered to the gulag in El Salvador. The ruling was notable because it jumped past the normal order of review. It was also absolute, a clear and unambiguous order handed down in the middle of the night. That came after more than a week when the White House was ignoring and willfully misinterpreting — in and out of court — the earlier order to “facilitate” Abrego Garcias’ release from custody in El Salvador. It seemed like the White House had accomplished what you never as a litigant want to do: convince the judge you’re a liar who’s not acting in good faith. That seems like the clear backstory behind the overnight order against any more renditions to El Salvador.
It’s no accident that the trade woes coincide with reverses on other fronts, in Trump’s war with universities, backtracking on some of his more drastic reorganizations of departments, with the Supreme Court. I don’t want to overstate this. Trump and those working for him continue to impose drastic changes on the federal government. They have the power. Lots of things are happening in the background. But that shouldn’t blind us to the fact that in a series of high profile confrontations he’s retreating. Political power is unitary. A strongman needs to look strong and dominating. Being forced to back down is a zero-sum reality. It affects him everywhere. With China, with Harvard, with SCOTUS. It’s all part of the same calculus.