In a phone call from the Oval Office, President Trump had just delivered unwelcome news to three of America’s most powerful auto executives: Mary Barra of General Motors, John Elkann of Stellantis and Jim Farley of Ford.
Everyone needs to buckle up, Mr. Trump said on the call, which took place in early March. Tariffs are going into effect on April 2. It’s time for everyone to get on board.
The auto chiefs, like the leaders of other industries, had been arguing that Mr. Trump’s 25 percent tariffs on cars coming from Canada and Mexico would wreak havoc on their supply chains and blow a hole through their industry. They had won a concession of sorts when Mr. Trump agreed to give them a one-month reprieve, until April 2.
But now, the Big Three automaker chiefs seemed to realize there was no point in fighting for more. They had gotten as much as they were going to get.
For corporate America, including some major donors, the shock of Mr. Trump’s second term is that it turns out he really does believe the thing he’s been saying publicly for 40 years: Foreign countries are ripping America off, and tariffs are a silver bullet for America’s problems. When he says that “tariff” is the most beautiful word in the dictionary, he means it.
To Mr. Trump, tariffs are not merely a negotiating tool. He believes they will make America rich again. And they combine two of his favorite features of the presidency: They are a unilateral power that he can turn on or off on a whim, and they create a begging economy, forcing powerful people to come before him to plead for mercy.
This account is based on interviews with more than a dozen Trump administration officials and others familiar with the dynamic at the White House over tariffs. They asked for anonymity to discuss private conversations and deliberations.
In the corporate community — a group that spends a fortune on consultants to interpret Mr. Trump, and where the cliché of taking him “seriously but not literally” is in high circulation — many had been clinging to the view that he saw tariffs only as a tool of leverage. It was not that Mr. Trump loved tariffs, they told themselves. It was that he loved what the threat of them could yield in a negotiation.
Over the years, it had become conventional wisdom that the stock market was Mr. Trump’s guiding light and guardrail, and that any plunge in the markets would limit the scope of his tariffs, which were more surgically applied seven years ago.
But Trump 47 has so far been undeterred by a plummeting market and by headlines that would have forced Trump 45 into reverse. The Dow Jones industrial average has shaved off more than 600 points since the new tariffs began. The S&P 500 slid into a correction, meaning it has fallen by more than 10 percent from its peak.
During his first term, Mr. Trump had a weaker stomach for the economic pain caused by a far narrower program of tariffs. He placed tariffs on more than $300 billion of products throughout his first term; now, less than two months in, he has slapped tariffs on roughly $1 trillion of goods.
A few recent public opinions polls show a growing number of Americans disapproving of Mr. Trump’s handling of the economy, but his advisers insist that’s more about lingering high prices than tariffs
One of Mr. Trump’s advisers, speaking on the condition of anonymity to describe private conversations, said the Biden presidency proved to Mr. Trump that the stock market is not a foolproof barometer of the economy’s future, nor a useful indicator of voter sentiment. If it were, Mr. Biden, who presided over a booming stock market, would surely be the president, the adviser said, explaining Mr. Trump’s thinking
Advisers say Mr. Trump knows that foreign leaders are watching to see whether he follows through on his threats, looking for signs of weakness. They have said he believes that backing off his tariffs would permanently damage his preferred image as a strongman.
Sometimes he has granted absolution of sorts — like when he exempted from tariffs products from Canada and Mexico that comply with his North American trade deal. But he has repeatedly said that more and bigger tariffs are on the way.
Business leaders are now rapidly reassessing the cheerful assumptions that had guided their thinking since Election Day.
Bill Reinsch, a senior adviser at the Center for Strategic and International Studies and a former Commerce Department official, said Mr. Trump had been explicit in the campaign about his intentions, and that his tariff proposals this time have been much deeper and broader than in his first term.
“I think he was clear,” he said. “I don’t think people paid much attention.”
Their misread is understandable.
In the lead-up to the 2024 election, Mr. Trump’s new crop of economic advisers sent reassuring signals to Wall Street. Their public remarks suggested that Mr. Trump’s second-term trade policy would be much the same as the first. In September, Howard Lutnick, now the commerce secretary, described tariffs as a “bargaining chip” that would ultimately lead to freer markets. And Scott Bessent, who became Mr. Trump’s treasury secretary, wrote in a letter to his clients last year that “the tariff gun will always be loaded and on the table but rarely discharged.”
Okay, this is reporting from early March – in this current climate, if the news is more than 2 hours old it means nothing.
Soft-Mongoose-4304 on
According to John Bolton Trump typically has no strategy. He just does whatever he wants at a specific point in time
Knowing that, these tariffs aren’t part of a grand plan. There’s nowhere he’s really envisioning as the final goal. He’s just doing stuff just cuz.
Is Donald Trump the ultimate performance art?
Or is he just a moron
College_Prestige on
Damn maybe industry heads shouldn’t have supported Trump
Loves_a_big_tongue on
>A few recent public opinions polls show a growing number of Americans disapproving of Mr. Trump’s handling of the economy, but his advisers insist that’s more about lingering high prices than tariffs
Inflation is Transitory 2.0: Tariffs Edition
Bad planning, and it’s already negatively affecting American’s expectations of this year. Though I’m way less sympathetic this time around. Third time to reject Trump and his economic suicide pact but instead voters acted like it was The Great Depression all over again and deluded themselves they can return to pre-Covid prices with him
As much as I enjoy the “Time to touch the stove” memes, we’ll never learn. 2008 Financial Crisis and 2 years later GOP were given one of the biggest wave elections in American history. The American economy os turbo fucked amd no one is coming to rescue it.
mudcrabulous on
we will end the charade of the “big three”, kill the UAW, and import hundreds of thousands of Chinese EV’s next D administration inshallah
justbuildmorehousing on
> markets down over 10%
> ok lets do even more tariffs
People irl sanewashing this stuff are gonna drive me insane
gnurdette on
> President Trump’s approach to tariffs has unsettled many corporate leaders who believed he would use the levies as a negotiating tool. As it turns out, he sees them as an end in themselves.
Why are all these allegedlly intelligent business leaders incapable of seeing what has been screamingly obvious to us all along?
10 Comments
“The line fell silent.
In a phone call from the Oval Office, President Trump had just delivered unwelcome news to three of America’s most powerful auto executives: Mary Barra of General Motors, John Elkann of Stellantis and Jim Farley of Ford.
Everyone needs to buckle up, Mr. Trump said on the call, which took place in early March. Tariffs are going into effect on April 2. It’s time for everyone to get on board.
The auto chiefs, like the leaders of other industries, had been arguing that Mr. Trump’s 25 percent tariffs on cars coming from Canada and Mexico would wreak havoc on their supply chains and blow a hole through their industry. They had won a concession of sorts when Mr. Trump agreed to give them a one-month reprieve, until April 2.
But now, the Big Three automaker chiefs seemed to realize there was no point in fighting for more. They had gotten as much as they were going to get.
For corporate America, including some major donors, the shock of Mr. Trump’s second term is that it turns out he really does believe the thing he’s been saying publicly for 40 years: Foreign countries are ripping America off, and tariffs are a silver bullet for America’s problems. When he says that “tariff” is the most beautiful word in the dictionary, he means it.
To Mr. Trump, tariffs are not merely a negotiating tool. He believes they will make America rich again. And they combine two of his favorite features of the presidency: They are a unilateral power that he can turn on or off on a whim, and they create a begging economy, forcing powerful people to come before him to plead for mercy.
This account is based on interviews with more than a dozen Trump administration officials and others familiar with the dynamic at the White House over tariffs. They asked for anonymity to discuss private conversations and deliberations.
In the corporate community — a group that spends a fortune on consultants to interpret Mr. Trump, and where the cliché of taking him “seriously but not literally” is in high circulation — many had been clinging to the view that he saw tariffs only as a tool of leverage. It was not that Mr. Trump loved tariffs, they told themselves. It was that he loved what the threat of them could yield in a negotiation.
Over the years, it had become conventional wisdom that the stock market was Mr. Trump’s guiding light and guardrail, and that any plunge in the markets would limit the scope of his tariffs, which were more surgically applied seven years ago.
But Trump 47 has so far been undeterred by a plummeting market and by headlines that would have forced Trump 45 into reverse. The Dow Jones industrial average has shaved off more than 600 points since the new tariffs began. The S&P 500 slid into a correction, meaning it has fallen by more than 10 percent from its peak.
During his first term, Mr. Trump had a weaker stomach for the economic pain caused by a far narrower program of tariffs. He placed tariffs on more than $300 billion of products throughout his first term; now, less than two months in, he has slapped tariffs on roughly $1 trillion of goods.
A few recent public opinions polls show a growing number of Americans disapproving of Mr. Trump’s handling of the economy, but his advisers insist that’s more about lingering high prices than tariffs
One of Mr. Trump’s advisers, speaking on the condition of anonymity to describe private conversations, said the Biden presidency proved to Mr. Trump that the stock market is not a foolproof barometer of the economy’s future, nor a useful indicator of voter sentiment. If it were, Mr. Biden, who presided over a booming stock market, would surely be the president, the adviser said, explaining Mr. Trump’s thinking
Advisers say Mr. Trump knows that foreign leaders are watching to see whether he follows through on his threats, looking for signs of weakness. They have said he believes that backing off his tariffs would permanently damage his preferred image as a strongman.
Sometimes he has granted absolution of sorts — like when he exempted from tariffs products from Canada and Mexico that comply with his North American trade deal. But he has repeatedly said that more and bigger tariffs are on the way.
Business leaders are now rapidly reassessing the cheerful assumptions that had guided their thinking since Election Day.
Bill Reinsch, a senior adviser at the Center for Strategic and International Studies and a former Commerce Department official, said Mr. Trump had been explicit in the campaign about his intentions, and that his tariff proposals this time have been much deeper and broader than in his first term.
“I think he was clear,” he said. “I don’t think people paid much attention.”
Their misread is understandable.
In the lead-up to the 2024 election, Mr. Trump’s new crop of economic advisers sent reassuring signals to Wall Street. Their public remarks suggested that Mr. Trump’s second-term trade policy would be much the same as the first. In September, Howard Lutnick, now the commerce secretary, described tariffs as a “bargaining chip” that would ultimately lead to freer markets. And Scott Bessent, who became Mr. Trump’s treasury secretary, wrote in a letter to his clients last year that “the tariff gun will always be loaded and on the table but rarely discharged.”
[that headline](https://youtu.be/8eXj97stbG8?t=25)
This is going to be such a shitshow oh my lord
Okay, this is reporting from early March – in this current climate, if the news is more than 2 hours old it means nothing.
According to John Bolton Trump typically has no strategy. He just does whatever he wants at a specific point in time
Knowing that, these tariffs aren’t part of a grand plan. There’s nowhere he’s really envisioning as the final goal. He’s just doing stuff just cuz.
Is Donald Trump the ultimate performance art?
Or is he just a moron
Damn maybe industry heads shouldn’t have supported Trump
>A few recent public opinions polls show a growing number of Americans disapproving of Mr. Trump’s handling of the economy, but his advisers insist that’s more about lingering high prices than tariffs
Inflation is Transitory 2.0: Tariffs Edition
Bad planning, and it’s already negatively affecting American’s expectations of this year. Though I’m way less sympathetic this time around. Third time to reject Trump and his economic suicide pact but instead voters acted like it was The Great Depression all over again and deluded themselves they can return to pre-Covid prices with him
As much as I enjoy the “Time to touch the stove” memes, we’ll never learn. 2008 Financial Crisis and 2 years later GOP were given one of the biggest wave elections in American history. The American economy os turbo fucked amd no one is coming to rescue it.
we will end the charade of the “big three”, kill the UAW, and import hundreds of thousands of Chinese EV’s next D administration inshallah
> markets down over 10%
> ok lets do even more tariffs
People irl sanewashing this stuff are gonna drive me insane
> President Trump’s approach to tariffs has unsettled many corporate leaders who believed he would use the levies as a negotiating tool. As it turns out, he sees them as an end in themselves.
Why are all these allegedlly intelligent business leaders incapable of seeing what has been screamingly obvious to us all along?