One day, President Donald Trump imposed a punishing tariff regime against Canada and Mexico. The next, he froze auto duties for a month after suddenly realizing that – as everyone had predicted – they could wreck a quintessential American industry. Elon Musk, meanwhile, is taking his chainsaw to the bureaucracy, indiscriminately firing workers and feeding agencies into the wood chipper – pitching citizens and industries who rely on government payments into uncertainty just as the economy softens and is more vulnerable to such shocks.
Last week, Ukrainian President Volodymyr Zelensky came to the Oval Office to sign a rare-earth minerals deal that Trump billed as a triumph for the US. But Zelensky was provoked by Vice President JD Vance and kicked out of the White House. European leaders have spent days trying to fix the debacle. At first, Trump’s early-term energy on multiple fronts was a bolt of energy as he scratched his Sharpie across executive orders and chased away the lethargy that marked President Joe Biden’s waning months in office.
Six weeks in, however, as Trump makes gut-check calls to dismantle post-Cold War national security arrangements, the global free trade system, and the federal machine – all of which helped make the US a superpower – a new realization is dawning.Trump’s haphazard efforts to make peace in Ukraine, revive Rust Belt-heavy industry with 19th century-style tariffs and slash government are as improvisational as the “weave” – his name for his stream-of-consciousness campaign screeds. And the world is once again left hanging on the “America first” president’s whims and obsessions.
“There’s too much unpredictability and chaos coming out of the White House right now,” Canadian Foreign Minister Mélanie Joly said Wednesday, describing US trade policy as a “psychodrama” her country can’t go through every 30 days. The president, for instance, said Wednesday that Canada hadn’t done enough to stem the flow of fentanyl over the border – but only minuscule amounts of the drug are involved. Sometimes the White House complains about the flow south of undocumented migrants – but these numbers are also small. Trump also wants manufacturing to leave Canada and move south. No wonder some officials in Ottawa have concluded he’s trying to weaken their country to make it easier to annex.
Still, the president can point to some successes with his threat-based foreign policy. For instance, his fury that a Hong Kong-based firm owned two ports at either end of the Panama Canal is precipitating a purchase by US investment giant BlackRock. The president had falsely claimed these ports meant China controlled the vital waterway built by the US, but the change of ownership may still improve the US strategic position. And Trump might be downgrading the transatlantic alliance that has kept world peace for 80 years – but he’s set off an unprecedented rearmament program among NATO allies that other presidents have demanded for years. But just as often, it’s as if Trump is more interested in brute force personal power than working off any long-term playbook.
Michael Froman, a former US trade representative who chairs the Council on Foreign Relations, told Jim Sciutto on CNN International Wednesday that while the cost of imposing tariffs often outweighs the benefits, they can be a tool that gets other nations to the negotiating table. This is true in the case of Mexico with which the US has far wider border issues than Canada. But, Froman added, “you have to know what it is you want them to do for that leverage to be useful.” Trump’s relentless bullying of America’s friends – while seemingly doing everything he can to advance its traditional adversary Russia in Ukraine – may also drain US power in the long run.
“What we have seen this week is that the dollar has suffered a very sharp decline,” Ruchir Sharma, founder and chief investment officer of Breakout Capital, told Richard Quest on CNN International. “It’s revealing that the rest of the world is getting its act together … and I think investors are beginning to notice there are other countries worth investing in, given all this policy volatility that is emerging in the US,” he said.
The danger for the US therefore is that four more years of Trump’s antics could reshape the globe – in a way that does not comply with his vision of US dominance but leaves Americans looking in from the outside. Mexico and Canada, for instance, can’t change the geography that makes it a no-brainer to trade with the mighty US. But both also may see advantages in expanding trade and investment with America’s rising rival China. And the European Union, which is expecting its own barrage of Trump tariffs soon, may examine similar horizons.
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