Donald Trump has turned international trade into a sit-on-the-edge-your-seat affair. On Monday, he kept US allies guessing on what he would do on steel tariffs until the very last moment.
The US president imposed a 25% tax on imports of steel in March, but made exceptions for countries such as Canada, Mexico and members of the European Union. Those concessions expired May 1 at midnight. With just a few hours before the deadline, Trump decided to postpone the decision for a month.
It’s another example of Trumpian waffling. The president tends to go back and forth on big issues, from immigration, to North Korea, to gun controls. Trade is no exception; in the end, his administration’s trade policies rarely live up to his initial threats. Here’s how Trump’s bluster on trade has matched up against reality in the past:
Steel and aluminum tariffs
For Trump, steel is a matter of national security. Here’s his rationale for the tariffs:
|Threat:||Launch trade cases against other countries in a departure from the US’s approach. (Trade disputes in the US are usually raised by workers or companies and rarely by the government.)|
|Action:||Announces steel and aluminum tariffs.|
|Reality:||US imposes global tariffs but grants concessions to roughly a dozen countries, including Germany, France, Brazil, and Australia.|
|Latest:||The concessions expire May 1. Trump pushed the decision on them until June 1.|
Trump has called the North American Free Trade Agreement between the US, Mexico, and Canada “the worst deal ever” and again threatened to end it this weekend. Meanwhile, the US has been steadfastly working with representatives from the other two countries to revise NAFTA, chapter by chapter. Their months-long work has picked up in speed recently, as negotiators try to settle on an agreement before the Mexican presidential election in July.
|Threat:||Scrap NAFTA; impose border tariffs; pull out if Mexico doesn’t pay for Trump’s proposed border wall.|
|Action:||Starts renegotiation talks.|
|Reality:||The US remains part of NAFTA. Talks to revise the deal’s terms progress slowly.|
|Latest:||Members are pushing hard for a deal, but steel tariffs are a risk.|
On the Trumpian scale, the US-Korea Free Trade Agreement, or KORUS, got a “horrible” rating—a step up from NAFTA’s “worst ever” designation. Last month, he announced a revamped agreement that is in many ways similar to the original. A few days later though, he said he might hold off on it to use as leverage in negotiations about North Korea.
|Threat:||Trump says he’ll scrap KORUS if he can’t get a better deal, and suggests he’ll remove US troops from South Korea.|
|Reality:||US and South Korea agree to revise original deal slightly.|
|Latest:||South Korea got exemption from steel tariffs under the new deal.|
The Trans-Pacific Partnership is another trade deal Trump has flip-flopped on—and the only one he has abandoned. After campaigning on pulling the US out of the Trans-Pacific Partnership, or TPP, he did so in his third day in office. Recently, he has mentioned wanting to rejoin the multi-nation trade deal.
|Threat:||Kill the deal.|
|Action||Pulls the US out of the deal.|
|Reality:||The TPP is redone without US.|
|Latest:||Trump said he will reconsider joining TPP, but only if it’s better|
Since his 2016 campaign, Trump’s venting on trade has targeted China. Relations have been rocky since the US started taking trade actions against China, including raising tariffs on solar panels and launching an investigation into its requirements that foreign investors share their technology with Chinese partners. But a planned meeting this week between the US and Chinese officials shows Trump is not interested in a full-out trade war.
|Threat:||Impose a 45% tariff on Chinese products and label the country a currency manipulator.|
|Action:||Sets off a tit-for-tat on trade with China by imposing steel and aluminum tariffs and other trade actions.|
|Reality:||Both countries apply tariffs to certain goods; Trump proposes even more tariffs.|
|Latest:||US representatives are set to meet their Chinese counterparts in Beijing this week in an attempt to sort out their differences.|