Emboldened by threat of tariffs, Trump eyes China
Suggests secret side deal in Mexico talks
An emboldened President Trump said Monday that his tariff threat forced Mexico to strike a border deal, and he vowed that China will be the next target brought to heel by weaponization of access to the U.S. economy.
Both Mexico and the U.S. say they have perhaps 45 days to prove their deal is working or else they will revisit matters and look for more options to stop the 5,000 people a day coming from Central America through Mexico.
Mr. Trump also hinted at a secret side deal as part of the negotiations and said he will consider reviving his tariff threat unless it happens.
“We have an agreement on something that they will announce very soon. It’s all done. They have to get approval, and they will get approval. If they don’t get approval, we’ll have to think in terms of tariffs or whatever,” Mr. Trump said.
Mexican Foreign Minister Marcelo Ebrard dismissed talk of a side deal, and Secretary of State Mike Pompeo declined to settle matters. He said only that there were “a number of commitments made” and both the U.S. and Mexico are now on the clock to prove they can shut off the flow of people.
“Perhaps a month, perhaps 45 days, we’ll have
a good sense of whether we’re able to achieve these outcomes in the way we’re hoping that we can,” he said.
What both sides do agree on is that Mexico will deploy thousands of national police to its southern border region to help enforce its own immigration laws.
Mexico also agreed to take back more Central American asylum seekers who cross their territory en route to the U.S. That is an expansion of the Migration Protection Protocols, a program that the U.S. announced last year that has been tried on a small basis but will now be in effect borderwide.
Mr. Pompeo said the number of people affected will rise from “a couple of hundred” a day to “several thousand per day.”
The deal continued to roil Washington.
While some Democrats feared Mr. Trump did too well, clamping down on asylum seekers, others said he accepted an agreement that didn’t secure new concessions from Mexico.
“Nothing more than warmedup leftovers,” said Senate Minority Leader Charles E. Schumer, New York Democrat.
The stock markets, relieved that the president’s threat of a 5% levy on all Mexican imports was sidelined for now, rose Monday, even as business leaders complained about the damage they said Mr. Trump did by using tariffs as a threat to win cooperation.
Tough luck, Mr. Trump said. “It was all done because of the tariffs and because of the relationship we have with Mexico,” the president told reporters at the White House.
Mr. Trump has embraced his persona as “tariff man,” slapping duties on friends and adversaries alike over the past two years. Targets included China and members of the European Union.
Last month, he lifted tariffs on steel and aluminum imports from Canada and Mexico as a precursor to trying to pass his new U.S.-Mexico-Canada trade agreement. The 5% tariff threat erected a new hurdle, though the administration says it expects that agreement is still on track.
Critics say imposing tariffs is a relic of protectionist 19th century policies that disrupt markets and supply chains while imposing higher costs on U.S. consumers down the line.
“The administration’s efforts to use the threat of tariffs as a weapon to coerce other countries to change their policies is like a game of economic Russian roulette with U.S. taxpayers as the target,” said Brian Riley, director of the National Taxpayers Union Free Trade Initiative.
Geoffrey T. Gertz, a fellow on global economy and development for the Brookings Institution, said Mr. Trump was risking foreign trading partners’ goodwill by using access to the U.S. economy as a cudgel.
“Over time,” Mr. Gertz said, “other countries are going to seek to limit their dependence on the American economy, which could harm American economic and diplomatic interests.”
He also sided with those who said Mr. Trump didn’t win much substance with the deal.
“Though this leaves us more or less back where we started, these episodes do still have real costs for the U.S.,” he said. “For American businesses, they introduce significant uncertainty: it is hard to make investment decisions in the face of continual threats of new tariffs, even if many of them may not ultimately be enacted.”
Mr. Trump bristled at those naysayers and said he would prove them wrong.
“If we didn’t have tariffs, we wouldn’t have made a deal with Mexico,” Mr. Trump told CNBC.
He said the same tactic will work on others — such as the 25% tariff on more than $200 billion worth of Chinese imports he declared in May, after trade talks that appeared to be nearing the finish line collapsed.
The White House says it may be forced to slap tariffs on an additional $300 billion worth of Chinese goods if he can’t make progress with Chinese President Xi Jinping during the Group of 20 summit in Japan this month.
“The China deal is going to work out. You know why? Because of tariffs,” Mr. Trump said in a phone interview with CNBC.
OUTSIDERS: More migrants seeking U.S. asylum wait on the Mexican side of the border as part of an accord to head off President Trump’s threat of tariffs.
Soldiers stand guard to watch for passing migrants riding in public transportation in Tapachula, Mexico. An accord reached late Friday calls on Mexico to crack down on Central American migrants crossing its territory.