What did Trump do today?
He signaled that flattery was more important to him than the steel and aluminum industries.
Last week, to bipartisan horror and the confusion of his own staff, Trump announced unilateral tariffs on imported steel and aluminum. Even though blanket tariffs would hurt closely allied countries far more than the target Trump apparently intended to hit--China--Trump insisted that they would apply to all imports regardless of origin.
But this week, Trump began to hint that exemptions might be possible. Other countries aren't likely to bargain with the US for exemptions, because that would be giving the United States something for nothing--effectively turning international trade into a sort of protection racket. (Trump, who actually thinks that trade wars can be "won" by the countries participating in them, may be expecting exactly that.)
However, they can offer Trump personally something that he wants: attention and praise, especially from celebrities. Australia dispatched the professional golfer Greg Norman to lobby Trump for an exemption. It seems to have worked: Trump cheerfully promised to exempt Australia today, in exchange for nothing of substance beyond a "security agreement." (Australia could hardly be more of a military ally to the United States than it already is.)
Trump did not explain what made Australian steel and aluminum a threat to American jobs and national security before Greg Norman lobbied him, but not a threat afterwards.
Why does this matter?
- Even a scaled back version of a policy based on complete ignorance of economics will be a bad policy.
- It shouldn't be this easy to manipulate the President of the United States.