Trump "Overrules" Cabinet, Prepares To Unleash Global Trade War

While one of Trump's recurring campaign promises was that he would "punish" China and other key US trade counterparties if elected, for taking advantage of free-trade by imposing steep tariffs and duties on foreign imports to "level the playing field", the President's stance changed drastically after the election, U-turning following his amicable meeting with China's president Xi Jinping in March, but mostly as a result of pressure by his ex-Goldman advisors to keep existing trade arrangements in place and not "rock the boat."

Now, all that may be about to fall apart.

According to Axios, behind the constant media scandals, "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" where 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."

In other words, Trump - true to his campaign promises - is set to launch a global trade wars after all, one where then main country impacted would be China, however the collateral damage would extend to Canada, Mexico, Japan, Germany and the UK.

And what may be even more striking is that Trump overruled his cabinet, as "the sentiment in the room was 22 against and 3 in favor — but since one of the three is named Donald Trump, it was case closed." Axios adds that while "no decision has been made, the President is leaning towards imposing tariffs, despite opposition from nearly all his Cabinet."

Needless to say, if Trump follows through, the outcome would have a profound effect on U.S. economic and foreign policy; Trump will formalize his decision in the coming days.

What is also notable, is that this is the first time  - so far off the record - in which Trump has openly defied his Wall Street establishment advisors, while siding with the Bannon "populist" front:

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.

As Axios adds, the reason why Trump defied the guidance of his Wall Street-derived advisors is Trump's base "which drives more and more decisions, as his popularity sinks — likes the idea, and will love the fight."

This, more than anything, should send shivers down Wall Street's spine, because for all his bluster and outrageous media outbursts, Trump had largely been in Wall Street's pocket so far.

Not anymore, and with Trump's base hell bent on punishing the 1% (which includes Wall Street), if Trump indeed launches global trade war, his future decisions will become increasingly market unfriendly.


Killtruck cheka Fri, 06/30/2017 - 07:37 Permalink

Glad to see him overruling the OverRulers.not super happy about the trade war thing, but better than what we have going on for the last couple of decades. And not being owned by Wall Street is, as far as I can tell, a new thing for Presidents. Just don't go for any open-top limo rides in Dallas, Mr. President. They have magic bullets down there.  

In reply to by cheka

PT FrozenGoodz (not verified) Fri, 06/30/2017 - 07:57 Permalink

Why does China need to sell steel to the US anyway?  Why can't they just turn it into cars, washing machines, refrigerators, I-beams etc and sell it to their own peasants???  After all, they're the ones who do all the work.  Why can't they be rewarded for their labour?  From where does China get its iron ore, energy and other resources?"Oh, life is so hard!  I work my guts out building stuff all day and I am poor becoz no-one will buy it from me!" :  Can anyone else see a problem with this picture?

In reply to by FrozenGoodz (not verified)

Oh regional Indian barndoor Fri, 06/30/2017 - 09:40 Permalink

The death of the dollar is a long planned event.Get used to becoming a Gulag, soon, even this year perhaps. Your money won't buy shit abroad anymore. There will be two dollars. Standard and eurodollar.Flying in and out of the US will be a nightmare. All your two-wrists, in and out, wil dry up.This is not just a trade move. This is a giant step in the planned destruction of the US of A.Meanwhile, you can rah rah on so much winning.MAGA....Making America the Greatest Ass... 

In reply to by barndoor

Bes froze25 (not verified) Fri, 06/30/2017 - 11:30 Permalink

hahahahahahahahahhaahhahahahahhahahahahhaayou guys are fucking idiots.america was great when we were EXPORTERS with the world.not trade waringthis is going to end with us losing all over the fucking place.except orange jesus' and your wars will lead to our isolation and/or even worse MOAR REAL WAR. 

In reply to by froze25 (not verified)

Lea Bes Sun, 07/02/2017 - 09:13 Permalink

You guys are losing anyway. The dollar is less and less used as a world currency, which means the end of the US domination. So maybe it's better to do something instead of remaining frozen in an old pattern and drowning, while the rest of the world is rapidly changing.It remains to be seen whether Trump's idea is the right thing to do, though.

In reply to by Bes

Yog Soggoth froze25 (not verified) Fri, 06/30/2017 - 12:23 Permalink

Before 2008 I was talking to a captain of a barge headed from Tampa to Miami. They took the scrap metel to a big chinese carrier. So basically we gave them the raw product which was too expensive to deal with here, and sent it there only to have it sold back to us as a finished or downstream product. Why in the heck are we trading with a Communist country, and putting sanctions on Russia who should be our ally? Socialists get free labor and the two systems do not work together.  Put sanctions on China until they adopt a Republican form of government!

In reply to by froze25 (not verified)

popeye Yog Soggoth Fri, 06/30/2017 - 17:42 Permalink

China is not a communist country, it has a single party government. Do you understand? Try using your head instead of regurgitating the spittle of brainless media hacks who don't have a clue. So scrap metal is sold to Chinese firms that reprocess, sell to manufacturers, who then sell finished goods to their markets domestic or international. In the 70's this was the Japan story, then it was Taiwan producing cheap products, then Korea. You know what this is? Capitalism and the free market. And its a story that is hardly new, where an under-developed country with low cost of production trades its way towards a higher median standard of living (and concidentally higher costs of production). Next up: Vietnam & Indonesia. Then Africa (why do you think Africom exists?). Pull your head out of your arse and take a fresh look at the world around you.

In reply to by Yog Soggoth

joe90 Oh regional Indian Fri, 06/30/2017 - 14:28 Permalink

Death of dollar is inevitable, it technically died when Nixon removed its gold backing a, few years later after the "oil shortages" of the 70's it was then backed by the worlds resources predominantly oil, which "saved" it. So now it survives because the US runs a deficit so dollars can be exported (by the pallet load where necessary) to float around the world hoovering up resources (and drugs). So now it dies if either it stops being used by non-US countries to buy oil and resources OR exporting nations like Saudi run out of the will/incentive/coercion to buy US debt. It Inevitably dies only the timing is planned. So when you hear Trump saying things like "we are going to make them pay for their own defence" (can't remember who was talking about there), or actions like tariffs leading towards isolationism, he's either blissfully unaware of the role the US deficit plays in the world economy and thus the impact of such actions will lead to the death of the dollar or he's in on the plan for the timing of it.

In reply to by Oh regional Indian

TheReplacement joe90 Fri, 06/30/2017 - 16:31 Permalink

If you are Trump and you understand the collapse is inevitable then you have a choice, do it and get it over with or extend and pretend.  If you are Trump and you understand that the era extending and pretending is ending then it is best to control the timing and get it done instead of having it happen in a fashion completely beyond your control.Never let a crisis go to waste is a lot easier when you foresee the crisis.

In reply to by joe90

bonderøven-farm ass Oh regional Indian Fri, 06/30/2017 - 17:18 Permalink

With all due respect, ORI.....'MeriKa needs to get off it's collective ass and start producing shit again. As far as I can tell, our financed eKONomy has just about run it's course. Unless we rebuild our manufacturing base, we're toast when the Petro-$ dies.Unless, of course, you're confortable with the current arrangement of globalisation/consolidation and swaping your resources and time for worthless nylon/cotton notes.What gives?

In reply to by Oh regional Indian

lucitanian nmewn Fri, 06/30/2017 - 12:53 Permalink

No, Sorry the stupidity is mind boggling...Why choose to fight in a market which is already globally over supplied when you know your heading for a recession?Why provide temporary tariff protection to build capacity to produce a commodity already globally over produced?Employment? Not the right answer answer, expected expansion of local demand, not really. So, where's the benefit?...........  Global steel production    US Steel Prod.         China steel prod.2000               850.1                      101.8                     128.52015             1620.4                       78.92                    803.83(million metric tons) short why choose to fight for a glutted global market experiencing a medium to longer term decline? And at the end of the day does the tariff protection hurt China or US consumers more as net prices continue to decline? Or does the US expect to be selling US steel to the One Belt One Road initiative by 2025? (because as the Dollar loose its status as global reserve currency it will need to export to earn Yuan, Yen, Euros, etc. to import.)This guy's a business man?Appointing a cabinet to keep your friends happy, then override their common sense to keep your less than clever supporters happy because your popularity is dropping; this guy is falling between two stools in the musical chairs. In MHO its because he has no vision or policy to make America great again, he's just riding a breaking populist wave, without much control and a lot of bullshit.

In reply to by nmewn

nmewn lucitanian Fri, 06/30/2017 - 20:17 Permalink

"No, Sorry the stupidity is mind boggling..."So you are of the opinion this is only about America is China's largest "trading partner" at $388 BILLION, 18% of all its exports and it does so by printing the yuan and giving it to its "government sponsored enterprises" which is why one yuan is worth 15 US cents. Its second largest is its semi-autonomous "partner" Hong Kong...Yang ;-)

In reply to by lucitanian

wildbad BaBaBouy Fri, 06/30/2017 - 17:49 Permalink

its only language.

you want to MAGA, this step away from übernational corporate world dominance is essential.

things will get more expensive. like real paychecks for real work for real workers with real skills who put their money where their mouths are on the environment and real human tragedy.

if this is true, i am 100% behind my president on this one.

In reply to by BaBaBouy

Arnold Stuck on Zero Fri, 06/30/2017 - 08:44 Permalink…

"This means that suddenly China's steel exporters will have to scramble to find a comparably large market in which to sell their wares as now exporting to the US is prohibitively expensive and would result in massive losses to domestic producers. "


In reply to by Stuck on Zero