Rule of Law

Trump’s tariff misadventure

Most countries — indeed many Americans — perceive Trump’s tariff declarations as an illegitimate tool of coercive statecraft

US President Donald Trump’s announcement on 1 February to slap steep tariffs on imports from key American trading partners is just one of the many volatile decisions he has taken right from the first day (20 January) of his second term, but it is sending tremors across the world.

The mercurial President justifies these import taxes as helping the US economy and safeguarding the country from illegal immigration and narcotics smuggling.

However, most countries — and indeed many Americans — perceive his action as an illegitimate tool of coercive statecraft that can unleash wider trade wars, undermining the global economic order and indeed the US’s own economy and consumers.

Trump revealed his plan to impose 25 per cent tariffs on goods imported from Mexico and Canada. He also announced 10 per cent across-the-board duty on imports from China in order to pressure Beijing to stop the flow of the lethal synthetic opioid fentanyl into America. China is a major source of the chemical used by cartels in Mexico to make the drug.

Both Mexico and Canada managed to secure a month’s reprieve after urgent phone calls with Trump on 3 February, where they pledged to tighten border security to curb the unlawful crossovers and flow of drugs. When Mexican President Claudia Sheinbaum agreed to send 10,000 troops to the border, Trump said he would work to limit the influx of American guns into the country.

Canadian Prime Minister Justin Trudeau also agreed to appoint a fentanyl czar to collaborate with the US, and additionally to launch a Canada-US joint strike force to fight organised crime, and to invest $200 million to gather intelligence on organised crime.

However, in a volte face during a Fox News interview on Sunday, 9 February, Trump termed the two neighbouring countries’ assurances “not good enough” to keep his tariffs on hold. He also repeated his desire to make Canada the 51st state of the US, asking, “Why are we paying $200 billion a year essentially in subsidy to Canada? Now if they’re a 51st state, I don’t mind doing it.”

Beijing, however, struck back, with retaliatory 10 to 15 per cent tariffs on a range of US products like crude oil, liquefied natural gas, farm machinery and other select items. Chinese foreign ministry spokesman Guo Jiakun told reporters in Beijing that there were no winners in a trade or tariff war. “What is needed now is not the unilateral imposition of tariffs, but dialogue and consultations based on equality and mutual respect,” he said. “We urge the US side to stop its wrongful actions and refrain from politicising and instrumentalising economic and trade issues.”

China then went beyond retaliatory tariffs, announcing last week an antitrust investigation into Google, adding two other US companies to an “unreliable entities” blacklist, and enhancing export controls on rare metals that are crucial to technology supply chains.

The European Union (EU) on Tuesday joined Mexico and Canada in condemning Trump’s tariffs on all steel and aluminium imports from 12 March, with European Commission president Ursula von der Leyen saying the 27-nation bloc would take “firm and proportionate countermeasures”, even as she met US vice-president J.D. Vance at an AI summit in Paris that day.

Trump raged on nevertheless, vowing reciprocal tariffs on all countries that impose duties on US goods, and said he was also looking at tariffs on cars, semiconductors and pharmaceuticals. Asked about threats of retaliation by other countries, he scoffed, “I don’t mind.”

The President’s weaponisation of trade tariffs counters the World Trade Organisation’s (WTO) protection against unfair trade practices, where protective tariffs are permitted in cases of anti-dumping, where foreign firms sell exports below their cost of production, or as countervailing measures against unfairly subsidised imports. The US has been a WTO member since 1995 and a member of the General Agreement on Tariffs and Trade (GATT) since 1948.

Since re-entering the Oval Office, Trump has threatened numerous countries with tariffs, many of which are non-economic in nature. But his actions raise a larger question: how can any US President — who is undeniably the most powerful and influential person on the planet, whose decisions and actions have national as well as global implications — conduct the affairs of his administration any which way he pleases without any fetters or regulatory safeguards?

Article II of the US Constitution outlines the President’s responsibilities, while envisioning a President accountable to the governed, not a king above the law.

Praveen Fernandes, vice-president at the Constitutional Accountability Center, a US thinktank and public interest litigation organisation, observes that the 1 July US Supreme Court ruling that Presidents have absolute immunity for the exercise of their core Constitutional powers and are entitled to a presumption of immunity for other official acts challenges the accountability envisioned by the framers of the Constitution and moves the nation closer to the monarchical systems they sought to avoid.

“This ruling is the latest reminder that even when the Constitution is clear, we depend on judges to interpret it fairly,” he noted. “Judicial nominations matter. Electing Presidents who will nominate fair and principled judges is important. Electing senators who will rigorously scrutinise those nominations is important. Let’s not forget that.”

On 4 February, Bernie Sanders, the longest-serving independent in US Congressional history, cautioned the Senate: “The Trump administration is moving this country very aggressively into an authoritarian society where the rule of law, and our Constitution, are being ignored and undermined in order to give more power to the White House and the billionaires who now control our government. In my view, the Trump administration is moving this country very rapidly toward a kleptocracy — where the function of government is not to serve the people of America, but to enrich those who are in power.”

Sarosh Bana is regional editor, India/Asia-Pacific of Naval Forces. He concentrates on foreign affairs, policy, strategy, defence and security, cyber security, energy and environment. You can read more of his writings here