Just days before announcing the latest round of tariffs on Chinese imports, President Donald Trump caught sight of a distressing suggestion as he flipped through the morning papers.
“We are under no pressure to make a deal with China, they are under pressure to make a deal with us,” he tweeted. “Our markets are surging, theirs are collapsing. We will soon be taking in Billions in Tariffs & making products at home. If we meet, we meet?”
In a West Wing rife with well-documented chaos, no area better embodies Trump’s duke-it-out whims than trade, particularly with China. The President has had long-standing, dogmatic conviction on trade policy and, according to multiple people close to the administration’s internal deliberations, those views will not change.
Now, as the President arrives in New York for the annual United Nations General Assembly, the US-China trade war is looming larger than ever, threatening to unsettle the global economy if the dangerous game of tit-for-tat between these two economic behemoths persists.
An administration at odds with itself
In the days leading up to last week’s announcement of new tariffs on $200 billion worth of Chinese goods, Trump obliterated the chances for a diplomatic solution sought by his Treasury secretary. Instead, he upped the ante, and the prospect of negotiations to stave off another volley of tariffs between the two countries promptly fizzled.
“There is no scheduled US-China negotiation at the moment,” a senior White House official said on Friday. “That doesn’t mean it wouldn’t happen.”
At the same time, his moves emboldened the administration’s hard-liners, who believe economic pain and an uncompromising stance on core US demands are the only way to force Beijing to alter its trade practices. White House officials also insist the current strength of the US economy gives the United States a prime opportunity to take a tough negotiating stance against China.
Driving Trump, according to aides, is a persistent aversion to appearing weak, even in the face of dire warnings and political fallout. But he has also allowed internal divisions to persist — a management style he prefers — offering up uncertain negotiating territory and giving Beijing an opening to exploit divisions among the President’s top economic advisers.
The President has continued to face internal opposition to his more hawkish trade views from several of his top advisers, most notably Treasury Secretary Steve Mnuchin and senior economic adviser Larry Kudlow.
But while the two men have privately sought to dissuade Trump from pursuing the increasingly costly trade war with China, they have been far less effective at discouraging Trump from following his protectionist instincts than the President’s advisers were in the first year of his presidency.
“The biggest challenge for the administration right now is that you have people like Kudlow and Mnuchin who are smart and have beliefs that cut in the other direction, but rather than strenuously trying to make those arguments, they are just trying to blunt the sharp edges,” said a person with knowledge of the administration’s internal deliberations on tariffs who compared these efforts to “rearranging the deck chairs on the Titanic.”
Debate encouraged
Several administration sources downplayed the internal strife. Instead, these officials insist that the President encourages debate and said the President’s advisers are united in affirming the importance of addressing the Chinese issue.
The President’s more hawkish trade advisers like US Trade Representative Robert Lighthizer and Director of Trade and Industrial Policy Peter Navarro now appear to have the President’s ear.
The two camps of advisers all huddled in the Oval Office several hours after Trump dispatched his tweet. There, the President was adamant that anything less than the harsh package of tariffs he’d been threatening for months would be viewed as surrender, three people familiar with the episode said.
