Trump’s Surprise Steel And Aluminum Tariffs Result In First Real Rift With Republican Leadership
Much Of This Week Will Be Spent Trying To Get The President To Reverse Or At Least Moderate His Stance
After a meeting at the White House with Israel’s Prime Minister Benjamin Netanyahu, Trump said his tariffs are 100% and not up for debate, asserting “our country, in trade, has been ripped off by every country in the world.” Here are the President’s comments (click on photo to play):
Still, the President’s reportedly agreed to attend a meeting of companies that use a lot of steel and aluminum, set up by his Chief economic adviser, Gary Cohn. It’s tentatively scheduled for Thursday. (We wonder if that meeting will be open to the viewing public, “Trump-style”.) Cohn apparently playing the “last person in the room” card: that Trump often agrees with the position of the last person he spoke with on an issue.
There’s another interesting dynamic at work here too: Cohn is trying to drown out the voice of Trump’s Trade Director, Peter Navarro, who’s been promoting tariffs for ages, and seems to have Trump’s ear right now. Even though Cohn is technically Navarro’s boss.
Republicans don’t like the tariffs, saying they could take a big bite out of the salutary impact of their tax cuts. Senate Finance Committee Chair Orrin Hatch calling the trade taxes a “tragedy”, while at the same time being careful not to blame Trump, rather Trade Director Navarro.
And they’re threatening to take action to take back trade negotiating responsibilities from the President. Since most of the country’s trade negotiators reside within the Executive Branch, we always thought that was the result of some kind of law. But apparently it isn’t, it’s just custom. And since the Constitution grants Congress authority over taxation and tariffs, they probably could do it.
The stock market seems to think there’s a good chance Trump will reverse himself: stocks rallied after big losses last week. Let’s also remember Trump/Republican tax cuts have created some built-in support for the stock market, with corporations using their cash windfalls to buy back their own stock in order to benefit shareholders in the form of a higher stock price. Bloomberg says they’re using about 60% of their tax break on those buybacks. So right now, whenever the market’s down a lot, it gives them an opportunity to jump in.
Why America Lost Its Steel Manufacturing Dominance In The First Place
We reported on this extensively last week: pointing out that Trump has the narrative all wrong when it comes to what went wrong with the U.S. steel industry, and why America lost its dominance. As a very well-researched article from Bloomberg documents, it had nothing to do with unfair trade practices, and everything to do with arrogant industry executives who refused to modernize and believed the U.S. government would always be there to bail them out.
The story quotes Ken Iverson, the legendary founder of Nucor, who adopted new production methods and revitalized steel making in the U.S. (domestic companies now supply 25% of demand, and growing): “Unless you’re under intense competitive pressure and it becomes a question of the survival of the business to do it, you’re just going to lapse back into your old ways”.
What Could Be Major Progress Today On North Korea
South Korean diplomats at the end of a visit to North Korea saying:
- North Korea’s Kim Jong-un has agreed to a face-to-face summit meeting with South Korea’s President Moon, to be held next month in a building set up for that purpose in the DMZ.
- South Korea says Kim is willing to start discussions with the U.S., and nuclear weapons are on the table.
- South Korea says Kim has pledged to suspend missile tests and nuclear tests as long as the negotiations are continuing.
What’s missing is a reason why North Korea has suddenly done such an about face on nukes (which is something we’re highly skeptical about, and we’re sure Trump probably is too), and direct confirmation from North Korea itself of the details of this story. For now, this is all second-hand, as related by a South Korean envoy.
But no doubt these are hopeful signs.
Much Of The Day Dominated By A Sideshow
Former Trump campaign adviser and professional rabble-rouser, Sam Nunberg told the Washington Post he’d been subpoenaed by Special Counsel Robert Mueller to appear this Friday, and turn over lots of emails, and he’d be refusing to comply. He then spent the following few hours appearing on pretty much any news show that would have him.
Nunberg, who already spent time in front of Mueller’s team last week, said by the end of the day he probably would cooperate after all. General Counsels generally don’t take kindly to people who rip up federal subpoenas. Clinton associate Susan McDougal famously spent 18-months in prison after refusing to comply with Kenneth Starr’s investigation.
One Of Longest Serving Members Of Congress Resigning For Health Reasons
Mississippi Republican Thad Cochran will leave in April, opening both of that state’s Senate seats this fall. Cochran’s term was not set to end until 2020. Cochran is Chair of the powerful Senate Appropriations Committee, which decides where the government’s money gets spent. He’s likely to be replaced in that position by Alabama Democrat-turned-Republican Richard Shelby.
One Thing We Happen To Agree With Trump On
The White House supporting a suit before the Supreme Court that would allow states to collect sales tax on all applicable internet transactions, regardless of where the seller is located. A ruling back in 1992 found states can’t force online merchants to collect sales tax unless they have a “physical presence” in the state.
At the time, the largely tax free status helped out a bunch of fledgling internet retailers a lot. Now people are so used to buying online, that adding sales tax isn’t likely to change their habits much. Besides, it always created a situation that was somewhat silly: if a company had a presence in your state, you had to pay tax, if it didn’t, you didn’t. So the law was actually encouraging people to not support local business.
Former Russia Spy Falls Gravely Ill After Exposure To “Unknown Substance”
This story line is becoming all too familiar: a former Russian agent, or opponent of the Putin regime, coming into contact with some chemical or biological agent, with dire consequences. This time, former Russian spy Sergei Skripal is at the center of the story. He was found unconscious, along with a woman, at a shopping mall in Salisbury, England. This morning, the BBC reports, the woman was identified as his daughter. Police are trying to identify a substance which caused the two to collapse, although they are not even willing to say a crime has been committed at this point.
This story from the New Yorker by Jane Mayer, profiling Christopher Steele, author of the infamous “Trump Dossier”. Whether you personally believe it’s probably true or a bunch of BS, it’s a fascinating read.
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