With Cohn out, it became clear over the past 24 hours that Trump was not bluffing with the steel and aluminum trade tariffs, contrary to the market's rosy assumptions, and the only question was "when" will Trump officially sign the proclamation.
We got a hint earlier today, when White House spokeswoman Sarah Sanders told reports that “we are still on pace for an announcement on that at the end of this week."
Then moments ago, Axios reported, citing two senior admin officials, that Trump wants to sign the proclamation on steel and aluminum tariffs tomorrow, although it hedges that "still going thru legal process so nothing certain." As Axios adds, "Trump is impatient and he wants to act — or at least be seen as acting. He got fed up with staff, especially Gary Cohn and Rob Porter, not giving him his tariffs on steel and aluminum. And some of Trump’s nationalist-minded advisers are telling him these tariffs will help turn out voters in the upcoming special election in Pennsylvania's 18th congressional district."
On the other hand, "these days — and in this White House — nothing is set in stone. Besides, the White House lawyers have been working overtime on these tariffs and sources tell me nothing is certain when it comes to timing."
What to watch from tomorrow's proclamation, per Axios:
- Are any countries exempted? If not, this is a global 25% tariff on steel, and 10% on aluminum.
- What, if any, steel and aluminum products are exempted? Past proclamations have listed specific products for targeted tariffs, but they were on different grounds than this round.
- What does the post-tariff exclusion process look like? How do they handle the potential exemptions for specific products or countries after the fact?
Finally, a quick look at the proclamation process.
- The Trump administration used a proclamation earlier this year when it slapped restrictions on Chinese solar panels.
- Most proclamations imposing tariffs — like Trump's move against Chinese solar, Obama's 2009 Chinese tire tariffs, or Bush's 2002 steel tariffs — are highly-detailed documents based on government trade reports.
- They also tend to run through the U.S. International Trade Commission (USITC), but this round will not because they're using Wilbur Ross' Section 232 report, citing national security grounds.
- This one is different: 232 is rarely invoked, but one example is Ronald Reagan's use of 232 in 1982, when he cited national security grounds for ending oil imports from Libya.
Finally, at the same time as the unconfirmed report hit, Trump tweeted that "we must act soon", noting that "China has been asked to develop a plan for the year of a One Billion Dollar reduction in their massive Trade Deficit with the United States"
China has been asked to develop a plan for the year of a One Billion Dollar reduction in their massive Trade Deficit with the United States. Our relationship with China has been a very good one, and we look forward to seeing what ideas they come back with. We must act soon!— Donald J. Trump (@realDonaldTrump) March 7, 2018