Trump’s trade stance shaped by deep convictions – and political instincts

Donald Trump is railing against a foreign power “dumping” its products in the United States. He calls the U.S. a “debtor nation.” He insists other countries must pay their “fair share.”

“I do get tired of seeing the country ripped off,” he says.

The year is 1988, and the focus of Mr. Trump’s ire is Japan. In this short video clip from an appearance on “The Oprah Winfrey Show,” Mr. Trump never refers to tariffs directly, but it’s clear he believes they’re the solution.

He also didn’t rule out running for president some day – and said if he did, he’d win. “I’ve never gone in to lose in my life,” he says.

Be it in business, politics, or a trade war, now-President Trump has been consistent in his self-image as a winner. And as he digs in for a potentially long, costly battle with China over trade practices, Mr. Trump is demonstrating that he does have some long-held, core beliefs, despite having changed his positions on other policy issues, such as abortion, to win the support of key constituencies.

From the day he announced his presidential campaign almost four years ago, protectionism and stricter immigration practices have formed the unflinching basis of his agenda. Now, with an eye toward reelection, Mr. Trump is engaged in a singular drive to fulfill the campaign promises that he believes fueled his 2016 victory.

“He wants to go to the American public, and say ‘Look, I’ve done what I said I’d do,’” says Todd Belt, director of the Graduate School of Political Management at George Washington University.

That’s not to say Mr. Trump never backs down, even on his core goals. Earlier this year, he caved on the record-long government shutdown over funding for a border wall one day after insisting he wouldn’t. 

And Mr. Trump’s reputation for being mercurial is well earned. Consider his dealings with North Korean leader Kim Jong Un, in which Mr. Trump has gone from threatening “fire and fury” to professing “love” to feuding once more. Mr. Trump’s unpredictability has become predictable, in an echo of the Nixon-era “madman theory” of international relations, which can keep those around the president as well as world leaders off balance.

Yet through it all, Mr. Trump’s beliefs on trade and immigration remain constant.

And therein lies another challenge. Mr. Trump has insisted for decades that tariffs are a boon to the country that imposes them. The reality is much less rosy. Last year, U.S. trade wars predominantly with China cost the U.S. economy $7.8 billion in lost gross domestic product, according to academic research.

“Trump says they [the foreign countries] are paying the tariffs,” says Patrick Kennedy of University of California, Berkeley, a co-author of the study. “Our studies have found U.S. businesses and consumers are paying the tariffs.”

Jordan Tama, an expert on the politics of U.S. foreign policy at American University, says Mr. Trump is not only driven by his deeply held, if misguided, views on trade but also his understanding of how the issue can work for him politically. Mr. Trump thinks being tough on China could be good politics – and that could prove true, depending on how things play out. 

“Most Americans do think the U.S. should take a tough stance toward China on economic issues,” Mr. Tama says. “But if Trump is seen in negotiations with China as giving in on economic issues without getting much in return, this could open him up to criticism in the 2020 campaign.”

Mr. Trump, in fact, has been widely applauded, including by top Democrats, for taking on China’s practice of stealing intellectual property and forcing American firms to share their technology as a condition for access to the Chinese market.

Still, economists see a risk that the escalating trade war with China, the U.S.’s biggest trading partner, could push the U.S. into recession. Currently, unemployment is at a 50-year low of 3.6%. In the first quarter of 2019, economic growth was strong at 3.2%, and the stock market is back on the upswing after a brief dip over fears of a trade war. If this record continues, it could be Mr. Trump’s best argument for reelection.  

“Even if tariffs do take a bit of strength out of the economy, he seems to be betting it won’t go into recession,” says Mr. Tama. “He might be right. The U.S. economy is still doing well. But that doesn’t mean it will continue to do well with a new round of tariffs.”

To Mr. Trump’s reported chagrin, top economic adviser Larry Kudlow acknowledged this week on “Fox News Sunday” that both sides pay for the cost of tariffs, as American importers take what is effectively a tax increase and pass it on to U.S. consumers. But Mr. Kudlow defended the president’s approach, saying it was worth the risk to correct “20 years-plus of unfair trading practices with China.”

Mr. Trump has faced pushback on his protectionism from the business community, including the U.S. Chamber of Commerce and the Koch network, both of which reflect the GOP’s traditional free-trade philosophy. But among the party’s rank and file, opinion has swung in the president’s direction.

“Within his party, he’s now getting over 50% support for tariffs,” says Charles Franklin, director of the Marquette Law School Poll in Milwaukee. “It shows how powerful leadership is when it comes to specific issues, and a party whose members are naturally inclined to support that president’s positions.”

More important, though, in a crucial battleground state like Wisconsin – part of the “blue wall” that helped elect Mr. Trump in 2016 – is how farmers are faring during the trade wars. In the past, China has retaliated by slowing purchases of soybeans and other agricultural products. Last year, the administration set up a $12 billion bailout fund to help farmers. On Tuesday, Mr. Trump suggested he would provide another $15 billion.