Cogito Ergo Non Serviam
Trump Loses Nerve on Tariffs
Donald Trump likes to make bold moves, but if there is any push back at all, he starts to lose his nerve. That is exactly what happened yesterday when he announced a 90-day pause on most of the tariffs he so ill-advisedly announced last week. The stock market was down massively, the bond market was starting to sink, and the dollar was headed down as well. The White House is pretending this is all part of a negotiating strategy, but all he has really done is taken the instability he created and frozen it in place for the next three months. That is not enough time to get any deals done, let alone bilateral deals with dozens of nations. And China is not part of the delay.
The administration made a complete hash of this, but that is hardly surprising. They do not know how things work. They do not know what they want to achieve. They do not know how to deliver.
The best proof of this was in the House Ways and Means Committee where the US Trade Representative Jamieson Greer was testifying while the president posted on social media that the pause was happening. Congressman Steven Horsford (D-NV) had this exchange with Mr. Greer according to The Hill:
"How long is the pause? How many days? How many weeks?" Horsford asked.
"I understand it's 90 days, I haven.'’t spoken to the president --" Greer began to say before Horsford responded.
"So, the trade representative hasn’t spoken to the President of the United States about a global reordering of trade and yet he announced it on a tweet? WTF, who's in charge?" Horsford said, before arguing, "It looks like your boss just pulled the rug out from under you and paused the tariffs, the taxes on the American people."
The decline in the bond market is the straw that broke the president's nerve. The stock market is important, but the bond market is vital. The bond market is how the money in the banking system gets to where it needs to be. When the bond market is tied up, there is a risk that there will be no cash coming out of the ATM. That is not an exaggeration. In 2008, the UK came within 48 hours of that calamity.
The White House claims that as many as 75 countries have called asking to open negotiations. The White House also declined to name them, so this goes in the category of unproved at best. Even if that is true, how will Mr. Greer and his staff cut 75 deals with 75 countries in just 90 days. Bear in mind the US-Mexico-Canada deal that Mr. Trump negotiated to tweak NAFTA took two years. The Congress will be in Democratic hands before any of these deals is done.
The trade war with China is still on and going full force. The US has a 125% tariff on Chinese products in place. China has a tariff on US goods of 84%. The trade between the two last year was $600 billion in all. That was with tariffs around 2-10% depending on the product. It is hard to gauge how little trade will occur at the new tariff levels, but the figure for 2025 is going to be much smaller than the $600 billion last year. Both nations will be poorer than need be as a result.
The real damage that this idiocy has done is to encourage other countries to shift their trade away from the US. The EU and China are going to get closer. Canada is discussing closer ties to Europe. China, Japan and South Korea are in talks to improve their trade. China is making inroads into Africa and South America, and they will continue to do so now.
Best of all, in 90 days, the world will be right back where it was earlier this week. The problem is not solved, just ignored so it can fester.
© Copyright 2025 by The Kensington Review, Jeff Myhre, PhD, Editor. No part of this publication may be reproduced without written consent. Produced using Ubuntu Linux.
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