A Dumb, Bad, and Expensive Bet...

How Do You Lose A Trade War? Actually Try One.

The Trumpanzie is in a pickle.

Does he continue with his tariffs and face the dire consequences of an insane global trade war? Or does he declare victory, scurry behind a rhetorical smoke bomb and try to live to fight another day?

Plenty of his friends and supporter/apologists are pining for option two. His Wall Street fans are howling for him to declare a 90-day “pause” on tariffs. Plenty of House and Senate GOP knees are shaking and praying the pain will end soon; what’s worse they wonder… losing a primary next year by crossing Trump now on trade or becoming toast in the general election during a recession?

It’s grim all around. Yet Trump clings to his beloved tariffs. How odd that for a politician with infinite ideological flexibility, the one thing Trump actually seems to really believe in is 18th century mercantile economics.

Next time Mr. President, perhaps less time in Bone Spur clinics and more time in Economics class.

So what’s next? Economic pain crushes poll numbers. Just give it a few weeks. Trump’s numbers on the economy are already starting to sag and this will accelerate. It is important to remember that Trump’s core political offer to voters last year was powerful because it was simple; “Ignore the other stuff. Just fire Biden/Harris and I will do a much better job of running the economy which will put money in your pockets.” They bought it. Now, he’s shattering his fundamental promise which means political disaster for him and the GOP. Think of McDonald’s suddenly being unable to make a hamburger and fries. It’s brand suicide.

So why not a retreat, wrapped in victorious rethoric? Announce that Trump has, yet again, performed a masterstroke, showing the world that he is serious about tariffs! A real lesson taught to those sneaky foreigners! MAGA! Now, a tariff freeze while the world’s lessor nations crawl to DC and beg for mercy from the King! Fox News has the graphic packages ready to go sir!

Here’s the problem: backing up and stopping the tariffs now is a huge loser for Trump as well.

The POTUS may have flunked Economics 101 but he does have a certain rodent-like gift for feral calculation. He knows if he retreats on tariffs not only will Trump show unprecidented weakness, his greatest fear, he will also put himself in an impossible negotiating position going forward.

First the plague of weakness. Like any strongman figure, Trump has to be the dominator any exchange. If Trump pulls his tariffs now, he’s the beta. The Stock market, which forced him to back down, becomes the alpha. And all the critics, the Democrats, Rand Paul, Bill Ackman, the lot of them will look right and Donald, will look wrong. That is untenable for Trump.

Second, the weak negotiating position. If Trump backs down, it’s an admission of failure and it’s near impossible to negotiate much from a position of failure.

Imagine Trump sitting across from one of the cartoonish characatures of a European trade negotiator he’s always trying to conjure up. After declaring a tariff pause, Trump now demands a new trade deal, or, and I’m warning you, the tariff’s come back!

Long beat. The Euro-diplomat, we’ll go with the stereotype and make him French (as portrayed by the excellent French actor Thimbault de Montlambert), sighs deeply and takes a long moment to polish his monocle. “Mon President, if we do not surrender to your outrageous demands, you will… bring back zee tariffs and blow your own brains out, again?!? Combien peux-tu être stupide??

Gales of French laugher, as the EU diplomat’s shark-eyed German aide coyly hands him a cellphone and Frenchie takes a phone call in perfect Chinese.

Trump’s ideal leverage was before he ignited the tariff inferno. Now that he’s proven to every American that a trade war hurts the U.S. as much as our trading partners, it will be very hard for Trump to threaten very much at all.

So Trump is stuck, a weakling in a new political equation he himself bunglingly created. Either he dives deeper into a huge political disaster, or he retreats into the kryptonite sea of impotence. My guess is the Administration will try to negotiate some fig leaf concessions fast, while trying to change the subject to a shiny culture war topic as loudly as possible. But the damage has been done. Trump shot his big tariff bullet and hit his own foot. Now it is only a matter of which painful and likely to fester exit wound he must endure.