What’s most striking about President Trump’s tariff war is that he’s being pressured by some of his closest advisers and supporters to end the crusade that has upended the world economy.
It’s not just media conservatives like Ben Shapiro, Rich Lowry, Ben Domenech and the Wall Street Journal editorial page. It’s longtime wealthy donors like Ken Langone, co-founder of Home Depot, who denounced the tariffs and cited the 46 percent levy on Vietnam as an example of “bull****,” telling the Financial Times that “right now what everybody’s terrified of is a trade war.”
Another billionaire, hedge fund investor Bill Ackman said, “The consequences for our country and the millions of citizens who have supported the president…are going to be severely negative.” Jamie Dimon, CEO of JP Morgan, said “whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth.”
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The most famous defector is Elon Musk, who, according to the Washington Post, privately urged Trump not to go ahead with the sky-high tariffs. Now he’s gone public:
“Ideally, both Europe and the United States should move to a zero-tariff situation, effectively creating a free trade zone between Europe and North America.” Even the world’s richest man and chief budget cutter couldn’t convince the boss, and he is off the reservation.
Musk is also taking shots at the strongest tariff booster in the White House, Peter Navarro, calling him “truly a moron,” “dumber than a sack of bricks,” and, in a particularly juvenile jab, “Peter Navarrdo.”
The aforementioned Navarro, you’ll be happy to hear, went on Fox and guaranteed there will be no recession. So you can all resume regular breathing.
It doesn’t help Trump that after an early rebound rally yesterday ran out of gas, the Dow dropped another 320 points, after a dramatic decline that has decimated people’s stock holdings and 401-Ks. The Constitution, by the way, says Congress is in charge of tariffs.
Almost no one is safe, including Bibi Netanyahu, who came to the White House on Monday in a ring-kissing gesture, has imposed no levies on the U.S., but still got hit with a 17 percent tariff. Against Israel, our chief ally in the Middle East and the region’s only democracy?
And the escalation with China, our biggest adversary, was predictable. Trump had hit Beijing with a 54 percent tariff (including an earlier 20 percent levy). Beijing hit back, as promised, with a 34 percent tariff on U.S. goods, battling what it calls blackmail.
Wouldn’t we have done the exact same thing if the roles were reversed?
But Trump acted as though he was personally insulted, and is now vowing an additional 50 percent tariff on the Chinese. This is how trade wars spiral out of control. And China has cut off negotiations on the sale of TikTok to an American owner.
Media blunders also fueled the market’s volatility. On Monday, Bloomberg – that is, someone identified as Walter Bloomberg, not connected to any news outlet – posted this: “HASSETT: TRUMP IS CONSIDERING A 90-DAY PAUSE IN TARIFFS FOR ALL COUNTRIES EXCEPT CHINA.”
This goosed the stock market. Except that Kevin Hassett, director of the White House economic council, never said that.
But CNBC morning anchor Carl Quintanilla told viewers, “I think we can go with this headline. Apparently, Hassett’s been saying that Trump will consider a 90-day pause in tariffs for all countries except for China.”
Reuters then ran with this headline: “Wall Street reverses course after Hassett’s comments on tariff pause.”
What Hassett actually said, when asked on Fox if Trump would consider a 90-day tariff pause: “I think the president is gonna decide what the president is gonna decide.” Not exactly the same thing. But the market shot up.
The wire service later admitted the mistake: “Reuters has withdrawn the incorrect report and regrets its error.”
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A CNBC spokeswoman said later, “As we were chasing the news of the market moves in real-time, we aired unconfirmed information in a banner. Our reporters quickly made a correction on air.”
Meghan McCain posted a broader swipe against the media: “There are so many hypocritical talking heads on TV saying they don’t care about losing money or being in financial pain for a while. Most of you are married to finance bros, come from rich families or have huge media contracts. You have a cushion…
“One of my best friends buys her groceries for her family based on what coupons each store has. I assure you a possible recession or huge rise in prices everywhere will be a different experience for her family than you.”
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Is there an exit ramp? White House officials say 70 countries have been in touch, seeking a negotiated settlement. Some, of course, were doing that in the runup to “Liberation Day.” The president could reach many of the settlements, declare victory and credit his tariff war.
At the moment, he shows no inclination to do that, having pushed the tariff idea since the 1980s and repeatedly promising such an approach during last year’s campaign.
I wrote a book on Wall Street and the media, talked to many top traders as well as business anchors and commentators. I understand the hair-trigger nature of the culture. Everyone expected that Donald Trump would impose hefty tariffs, just not at this stratospheric level.
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