President Trump To Impose Tariffs

Not clear where this is going:

With the political world distracted by President Trump’s media wars, one of the most consequential and contentious internal debates of his presidency unfolded during a tense meeting Monday in the Roosevelt Room of the White House, administration sources tell Axios.

The outcome, with a potentially profound effect on U.S. economic and foreign policy, will be decided in coming days.

With more than 20 top officials present, including Trump and Vice President Pence, the president and a small band of America First advisers made it clear they’re hell-bent on imposing tariffs — potentially in the 20% range — on steel, and likely other imports.

The penalties could eventually extend to other imports. Among those that may be considered: aluminum, semiconductors, paper, and appliances like washing machines.

One official estimated the sentiment in the room as 22 against and 3 in favor — but since one of the three is named Donald Trump, it was case closed.

No decision has been made, but the President is leaning towards imposing tariffs, despite opposition from nearly all his Cabinet.

In a plan pushed by Commerce Secretary Wilbur Ross, and backed by chief strategist Steve Bannon (not present at the meeting), trade policy director Peter Navarro and senior policy adviser Stephen Miller, the United States would impose tariffs on China and other big exporters of steel. Neither Mike Pence nor Jared Kushner weighed in either way.

Everyone else in the room, more than 75% of those present, were adamantly opposed, arguing it was bad economics and bad global politics. At one point, Trump was told his almost entire cabinet thought this was a bad idea. But everyone left the room believing the country is headed toward a major trade confrontation.

There are three possibilities. The first is the obvious – President Trump wants to impose tariffs as a way to give advantage to US producers, increase jobs, and reinvigorate the economy.

The second is President Trump is floating the idea of tariffs to gain leverage for future negotiations. Now he can get something in return for not imposing tariffs.

The third is that President Trump is looking forward a decade or two, and he sees a global war of some sort. If we are heading to a world war, we will need a steel industry and a robust manufacturing base. As it stands, we cannot get that in the face of cheap Chinese imports.

In that case even if there was a substantial cost to tariffs, it would be a cost well endured to get the country on the war-footing it will probably need to be on in a decade or two.

It is amazing to think about how one leader, whose loyalty is to the nation rather than to the establishment or his own reputation in the media, could change the course of mankind’s history decades hence. It is even more amazing how unusual it is to find such a leader.

Spread r/K Theory, because the big one is coming