Issues Under Fire: Donald Trump: The Shakedown Artist
In case you haven't noticed, U.S. allies and trading partners are preparing for a post-U.S. relationship. E.U. members are fed up with the Trump administration's aggressive and intimidating strategies to exact the most favorable terms from any agreements made with it going forward. This "Make America Great Again" sh*t ain't exactly going over very well with the rest of the world. In fact, there is a major realignment in progress among nations seeking protections from America's shakedown artist. Dividing the E.U. and others to conquer each nation economically in bilateral negotiation is a slick move. It's like a schoolyard bully isolating a target from any potential support so maximum pressure can be exerted without the predator being exposed for using strong-arm tactics. Unfortunately for Donald Trump, as usual, he went too far.
However, using economic thuggery as the basis for U.S. trade policy is triggering a global trade war, the United States can't win. When the U.S. went back on its word with China to nix the tariffs for the present, in order to reach a meeting of the minds on major trade conflicts during the current talks, Beijing went ballistic. And China was justified. The second largest economy in the world presumed the two competing powers were on the same page. But without warning, the Trump administration announced $50 billion dollars of tariffs against Chinese imports citing the usual complaints of theft of IP (Intellectual Property) and China's slow pace of increasing the imports of U.S. goods and services. Beijing responded by warning the U.S. that any and all agreements reached during the latest rounds of talks would be considered null and void if the announced tariffs are imposed against China.
China has its own ambitions to be great and the United States has reason to be worried. While a lot of attention has been given to China's One Belt Road Initiative, a development strategy that's connecting and cooperating with Eurasian countries to build a brighter future, Beijing has been promoting its "Made in China 2025 strategy. China is investing hundreds of billions of dollars into high-tech industries like robotics (AI) Artificial Intelligence and electric cars, with the expressed goal of making China a global leader. China is so close to overtaking the United States as the world's largest and most stable economy, it can't be pushed around so easily. Alone, China is an economic force that can hold its own, but with allies in its corner, China can be dangerous. And China is making new friends, partners, and alliances every day.
When the United States shows up at the G-7 Summit in Quebec Canada, later this week, Donald Trump will hear essentially the same message China is sending Washington, from the other members of the world's most influential economic drivers. If Trump's administration wants a trade war, the G-6 partners are prepared to fight back. Both Canadian Prime Minister Justin Trudeau and Mexico's President Enrique Peña Nieto announced plans to levy tariffs on U.S. imports. Mexico is planning 20% tariffs on pork shoulders and legs which could go into effect as soon as this Wednesday. Canada's planned retaliatory strike has been scheduled to be triggered in July. The Canadians want to give Washington plenty of time to reconsider its rash and irresponsible actions. And using the excuse of national security to camouflage blatant protectionist policies is not just intolerable, its insulting.
Angela Merkel of Germany and Emmanuel Macron of France have been in talks to reconfigure and reform the E.U.'s standard operating procedures. They see the United States as going rogue, the more it goes alone. In Europe's view, once a reliable ally and partner, the U.S. has become a lone wolf on the hunt to satisfy its insatiable desire to be and remain the greatest nation in the history of the world. Even if that greatness has to come at the world's expense. Let's face it, the European Union is seeking economic stability through trade policy continuity. Unfortunately, few would use words like stability and continuity in the same sentence Donald Trump. Chaotic and erratic are far more accurate descriptors of his administration's approach to negotiating agreements, accords, and partnership. So, that said, Europe is taking their independence to the next level.
When the U.S. reneged on the Joint Comprehensive Plan of Action, aka the Iran Nuclear Deal, that unilateral action forced Europe and its business community to chose to honor the international agreement or face the wrath of U.S. sanctions. With no way to anticipate what the United States would use as leverage to force compliance, the E.U. is not only planning to set aside differences in order to confront U.S. economic aggression, but its also considering French President Macron's European Defense Force Initiative. Responding to Trump's administration admonishments and threats of pulling out of NATO, the E.U. has concluded it can no longer count on the U.S. to be the guarantor of the security of Europe. If the U.S. is determined to go its own way, the world is preparing to say good riddance.
Bottom line: While the United States has enjoyed being king of the mountain for the last 60 years, the world is changing and changing rapidly. The days of America telling the international community when to jump and how high are coming to an end as national pride and demands for mutual respect begins to blossom in every corner of the globe. Sure, the U.S. can still shakedown the weaklings on the playground, but the other big boys are banning together to punch back. Podcast below
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