August 19, 2025

What’s the Driving Force Behind Trump’s Tariff Merry-Go-Round?

A one-word answer explains. Can you figure it out?

Why the Trump Tariff Merry-Go-Round Won’t Stop

Robert B. Zoellick, U.S. trade representative (2001-05), and deputy secretary of state (2005-06) explains in a WSJ op-ed.

Please consider Why the Trump Tariff Merry-Go-Round Won’t Stop

Anyone trying to make sense of President Trump’s tariffs is missing the point. The conga line of trade negotiators will keep dancing because Mr. Trump will continue to use tariffs to exert dominance, signal threats and make deals. There won’t be a new end state. Tariff numbers will keep fluctuating, prices for goods and investments will be unreliable, and agreements won’t last. But the damage to America’s economy and strategic interests will persist.

The president has cited various goals for his disorderly deal-making. He wants to cut bilateral trade deficits, open foreign markets, protect favored U.S. industries and restore manufacturing. He also wants to raise revenue and in some instances simply punish others for a perceived offense. His administration leaps from one rationalization to another to justify the boss’s most recent whim. But Mr. Trump won’t be pinned down. He believes uncertainty adds to his power and wants the freedom to bully others depending on what has his attention.

Consider the president’s dismissive treatment of the most important trade pact from his first term—the U.S.-Mexico-Canada Agreement, which renegotiated the North American Free Trade Agreement. Canada and Mexico, our closest trading and investment partners, can’t rely on Mr. Trump’s deal.

As a former reality TV star, the president enjoys signing papers and waving them before cameras. He likes announcing concessions and deals. He revels in the appearance of winning and moving on to the next episode. The rest of his government scrambles to discover the terms of the deals, sorting through the exceptions and side bargains—before the merry-go-round spins again. Enforcement will depend on Mr. Trump’s attention span and his latest fancy.

After World War II, the U.S. viewed economic and security policies as complementary. When America’s allies and partners succeeded, they added markets for U.S. producers, lowered costs for consumers and companies, expanded growth, and enhanced America’s security. During these years, presidents took advantage of the attractive power of the country’s flourishing economy and society while keeping America on the competitive edge.

By contrast, Mr. Trump relies on coercive power. He views economics as a zero-sum contest for a fixed pie of resources and wealth to be divided up through his deals. Ironically, the interdependence of America’s allies enables Mr. Trump to menace them more than possible foes. In contrast, he has been cautious with China, which made a plan to hit back effectively, especially through controlling exports of vital minerals.

Mr. Trump’s trade policies and uncertainty will impose costs over time. Prices will increase. Washington will misallocate resources to less-competitive sectors. Productivity will slide. Other countries will be less willing to rely on American policies and companies. The costs might be offset for a time by other aspects of the U.S. economy, such as investments in artificial intelligence, data centers and energy. But America will be dissipating economic power, resilience and competitiveness.

Mr. Trump’s tariffs and chaotic trade policy will yield a mishmash—not an international system led by a more powerful and attractive America.

The Word is Power

The single word that describes these events is power.

Trump respects North Korean leader Kim Jong Un despite the fact that North Korea is an economic basket case.

Q: Why?
A: Kim Jong Un has absolute power, and Trump believes he deserves the same power, over everybody and everything.

Trump wants to control the Fed, pick the head the BLS, decide who should be the CEO of Intel, fire economists at Goldman Sachs, and modify the constitution at will.

Trump even wants to control what exhibits are on display at the Smithsonian Institute’s National Air and Space Museum.

Zoellick says “The President likes tariffs because they allow him to exert dominance.”

Dominance is a good word too, and so is control. Full credit for any of those.

Other descriptions include economic illiteracy and extreme narcissism but they miss the mark of what I was looking for.

Economic Illiteracy

Trump’s economic illiteracy starts with his belief there is a winner and loser in every deal.

The fact is, if two sides agree to a deal, in the absence of coercion, then both sides think they benefit from it.

Trump has disrupted this normal deal making process with demands that he always be the winner. The irony of the setup is Trump’s deal demands are very often counterproductive to the US.

I can only imagine the howls if a Democrat president did these things.

Trump acts just like the Soviet Central planners (or more recently Kim Jong Un). Economically speaking, how did those work out?

The worst part is Trump treats allies worse than China. The bigger the ally, the more the pounding.

At the top of the ally pounding list is Canada, followed by Mexico.

Trump Statements on USMCA

August 21, 2023: The highly anticipated Des Moines Register Poll of Iowa Voters is just out: “DONALD TRUMP HOLDS COMMANDING LEAD In First Test of 2024 Republican Caucus Field.” Remember, I got the Farmers 28 Billion Dollars from China, the USMCA Trade Deal (& many others!), saved Ethanol, Social Security, and MediCare, & got Iowa “First In the Nation” status. Nobody else could have done this. Anyway, I’m at 51%, a 31 Point lead over “farmer hating” DeSanctimonious, with the others gaining on him, but not on me!
February 15, 2020: RT @WhiteHouse: President @realDonaldTrump’s USMCA will have a tremendous effect on GDP!
January 30, 2020: BIGGEST TRADE DEAL EVER MADE, the USMCA, was signed yesterday and the Fake News Media barely mentioned it. They never thought it could be done. They have zero credibility!
January 29, 2020: USMCA is a cutting edge state of the art agreement that protects, defends and serves the great people of our Country. Promises Made, Promises Kept!
January 29, 2020: USMCA is a massive win for American manufacturers and auto workers!
January 16, 2020: One of the greatest trade deals ever made! Also good for China and our long term relationship. 250 Billion Dollars will be coming back to our Country, and we are now in a great position for a Phase Two start. There has never been anything like this in U.S. history!
December 10, 2019: America’s great USMCA Trade Bill is looking good. It will be the best and most important trade deal ever made by the USA. Good for everybody – Farmers, Manufacturers, Energy, Unions – tremendous support. Importantly, we will finally end our Country’s worst Trade Deal, NAFTA!
December 19, 2018: Mexico is paying (indirectly) for the Wall through the new USMCA, the replacement for NAFTA! Far more money coming to the U.S. Because of the tremendous dangers at the Border, including large scale criminal and drug inflow, the United States Military will build the Wall!
December 13, 2018: I often stated, “One way or the other, Mexico is going to pay for the Wall.” This has never changed. Our new deal with Mexico (and Canada), the USMCA, is so much better than the old, very costly &, anti-USA NAFTA deal, that just by the money we save, MEXICO IS PAYING FOR THE WALL!
November 30, 2018: Just signed one of the most important, and largest, Trade Deals in U.S. and World History. The United States, Mexico and Canada worked so well together in crafting this great document. The terrible NAFTA will soon be gone. The USMCA will be fantastic for all!
October 3, 2018: Mexico, Canada and the United States are a great partnership and will be a very formidable trading force. We will now, because of the USMCA, work very well together. Great Spirit!
October 2, 2018: “USMCA Wins Praise as a Victory for American Industries and Workers”
October 2, 2018: Great reviews on the new USMCA. Thank you! Mexico and Canada will be wonderful partners in Trade (and more) long into the future.

Flashback October 1, 2018

Late last night, our deadline, we reached a wonderful new Trade Deal with Canada, to be added into the deal already reached with Mexico. The new name will be The United States Mexico Canada Agreement, or USMCA. It is a great deal for all three countries, solves the many deficiencies and mistakes in NAFTA, greatly opens markets to our Farmers and Manufacturers, reduces Trade Barriers to the U.S. and will bring all three Great Nations together in competition with the rest of the world. The USMCA is a historic transaction!

Does anyone have any questions regarding the greatness, importance, and historic nature of USMCA to farmers and manufacturers?

It was such a great deal that Trump thanked Mexico and Canada. Notably USMCA is “Good for everybody – Farmers, Manufacturers, Energy, Unions – tremendous support. Importantly, we will finally end our Country’s worst Trade Deal, NAFTA!”

It “greatly opened markets to our farmers” and it even paid for the wall! And it will bring three great nations together!

For more discussion, please see Cheese Was a “Key Achievement” of Trump’s USMCA Trade Agreement

Q&A on the Greatness of USMCA

Q: Is 250 percent on cheese fair?
A: It’s not 250 percent. It’s tiered, and embedded into USMCA.

Q: Who signed USMCA?
A: Trump

Q: Who is responsible for this arrangement?
A: Trump

Q: Didn’t Trump brag that USMCA was the best trade deal in history?
A: Yes

Q: Is Trump a good deal maker?
A: Apparently not, by his own admission

Excluding Oil, the US Has a Trade Surplus with Canada Every Year Since 2008

Also note that Excluding Oil, the US Has a Trade Surplus with Canada Every Year Since 2008