Trade

With the president overseas, Trump backers scramble to contain a trade war

WASHINGTON — While President Donald Trump dined with the British royal family, his team back in Washington was rushing to deal with the expanding trade war he left behind.

Administration officials started the week with a multifront scramble as they sought to ease worries about another market-shaking tariff escalation, explain the presidents thinking to allies and salvage negotiations with lawmakers over his signature trade agreement with Mexico and Canada.

Trump says hell hit Mexico with escalating tariffs starting next Monday unless the country does more to stem the flow of Central American migrants seeking asylum in the United States. The threat is already infuriating lawmakers, who warn that such a move could damage a strong U.S. economy and undermine efforts to win congressional approval of the USMCA, one of Trumps top legislative priorities.

“I dont even want to think about it,” said Senator John Cornyn (Republican-Texas) of the potential economic fallout that could hit his state if Trump slaps tariffs on Mexico. He warned of dire consequences for Trumps legislative agenda, too. “I think this calls into question our ability to pass the USMCA.”

Senator Joni Ernst (Republican-Iowa), who spoke with Trump by phone on Friday, said she emphasized to the president that Republicans should focus on approving the new North American trade deal and then shift separately to the situation on the border. But Trump was undeterred, she said. “Hes a tariff guy.”

“Sometimes in his frustration [Trump] expresses the intent to do certain things, but after calm reflection and consultation with the members of the Congress has decided maybe to pursue a different course” — Senator John Cornyn

“Im not pleased,” Ernst said, predicting the party would concentrate on trying to sway Trump in the coming week. “Hopefully hell be receptive. But right now hes not that receptive.”

Few Republicans offered much support for the move on Monday evening, according to interviews with a half-dozen Republican senators.

“Im concerned both with China and Mexico,” said Senator Rand Paul (Republican-Kentucky), a close Trump ally. “Worldwide tariffs are what led to the exacerbation of the Great Depression … Tariffs are a bad idea. Interruption of trade is a bad idea.”

The White House plans to send an official to Senate Republicans policy lunch on Tuesday to answer questions about the pending Mexico tariffs. Trumps aides, including members of the White House legislative affairs team, have sought to tamp down frustrations in Congress by separating the issues and encouraging lawmakers to not let their opposition to the tariffs stand in the way of approving the USMCA.

White House officials, who werent authorized to speak on the record, said lawmakers havent yet told them directly that they intend to hold up the USMCA as a result of the tariff threat, and they maintained outward confidence in the deals prospects. “If you put this on the floor, it will pass,” one White House official said.

Some White House aides also privately held out hope that Trump wouldnt go forward with the tariffs, given the divide inside the administration over the move.

Senate Republicans were just coming off a high point after six of them trekked to the White House this spring and finally got Trump to back off the steel and aluminum tariffs on allies, raising hopes for passage of the new trade deal. A legislative effort to restrict Trumps national security tariff authority had stalled, but the Republican found that diplomacy could move Trump — though it took them a year to do it.

This time around Trump is moving so quickly that Republicans tariff legislation wouldnt even block the new tariffs on Mexico. Rather than saber rattle over another round of legislative battles with the president, most Republicans prefer to hash things out behind closed doors.

“Sometimes in his frustration [Trump] expresses the intent to do certain things, but after calm reflection and consultation with the members of the Congress has decided maybe to pursue a different course,” Cornyn said. “Legislation obviously requires a presidential signature. The better course is to have some discussions in private.”

The presidents relations with Congress had already devolved into a worsening spectacle in recent weeks.

The White House is trying to ease tensions with House Speaker Nancy Pelosi, who railed against the administrations decision last week to send a draft statement to Congress that paves the way for moving forward with a vote on the trade deal. Pelosi viewed the move, which the White House downplayed as a procedural step, as an effort to cut short lawmakers review of the trade deal and ratchet up pressure on Congress to quickly pass it.

“I dont even want to think about it,” said Senator John Cornyn of the potential economic fallout that could hit his state if Trump slaps tariffs on Mexico

Democrats so far have been dismissive of Trumps latest tariff threat. Representative Debbie Dingell (Democrat-Michigan) raised her concerns about the tariffs during a closed-door leadership meeting on Monday night. In response, Pelosi suggested it was one of Trumps diversions to distract from last weeks statement from Robert Mueller about the Russia investigation, according to two sources familiar with the exchange.

U.S. Trade Representative Robert Lighthizer spoke directly to Pelosi to explain that last weeks USMCA statement wasnt intending to force lawmakers hands, according to a person familiar with the matter. White House staffers have also talked to Pelosis staff this week about both the possible tariffs and the speakers frustrations with the White Houses handling of the USMCA statement, the person said.

Trump administration officials are fanning out to address the tensions in coming days.

Lighthizer is scheduled to hold calls and meetings with five lawmakers this week as part of his ongoing push to sell the USMCA. Vice President Mike Pence plans to make another pitch for passage of the trade deal during a speech in Pennsylvania on Thursday, officials said.

Trump administration officials also must navigate a sharp backlash among investors and businesses, which see the tariffs as a major threat to the economy and stock market.

“Were taking it seriously and were operating as if it is going to go into effect,” said Neil Bradley, chief policy officer at the U.S. Chamber of Commerce, which strongly opposes the tariffs. “This wasnt an off-handed comment, responding to a question or a sociaRead More – Source

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