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.

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