The world thinks Trump is ‘Panican,’ he’s no

The stock markets across the globe have been in turmoil ever since United States President Donald J. Trump welcomed ‘Liberation Day’ with a bold announcement to increase tariff rates to a substantial degree on all sovereign nations and regional actors.

President Trump did not take the soft approach, but implemented sky-high tariff rates on all importers, knowing full well it would strike deep impact on the world economy.

Yet, US Treasury Secretary Scott Bessentt delivered words of caution to all nations in the immediate aftermath of Trump’s ‘Liberation Day’ announcement. Bessent, speaking in a calm and measured manner, advised all countries to refrain from over-reacting and they would discover that President Trump will answer their phone calls and seek resolution over perceived misunderstandings.

Bessent reminded the public that Trump’s tariff rates are “not permanent” and can be changed, according to circumstances. Reciprocal tariffs are intended to persuade other countries to support free and fair trade with the USA. But free trade does not always mean fair trade.

Many nations have massive trade imbalances with the US and even if President Trump would support 0 percent tariff rates on both sides, this will not deliver fair trade conditions, only makes it free. Accordingly, the countries enjoying large trade surpluses with the US will continue to prevail.

By understanding this logic, we can comprehend why China and perhaps a few other sovereign nations are beginning to ramp up pressure on the Trump administration and part of that strategy is to spark elements of panic and stir up fake news claims that White House officials are starting to turn against each other.

It’s a common geopolitical strategic principle, known as the “divide and conquer” method. It’s an ordinary action pivot in regard to diplomacy and trade talks among the Great Powers of our world. President Trump likes winning and so does China.

Additionally, we should not blame Beijing for fighting back with a strenuous vengeance with claims that they will never surrender and “fight to the bitter end.” Former US presidents, including George H.W. Bush, Bill Clinton, George W. Bush, Barack Obama and Joe Biden have all rolled over and waved surrender flags when they had engaged in trade disputes with China.

The Chinese officials have won so many battles with all countries that they had simply forgotten to comprehend the sting of defeat and they had never anticipated they would some day be confronted by the White House and President Trump could fight back in an equal strong and tough manner.

Hence, the Chinese side is rolling the dice thinking that they can continue to win and eventually President Trump will roll over as well. And that’s understandable. Why reverse course when China has been successful for so long with their rough and tumble trade tactics?

Nonetheless, all amazing geopolitical strategies have a deep flaw and there’s never a fool proof tactic. The weakness of China’s strategy is that in order for them to win on this matter - this requires President Trump to buckle under the pressure and surrender.

But that’s not President Trump and he’s not the man who worries about stock markets crashing, mainstream media attacks and Democrats charging up after him. He’s the right man for the right time to stand tall and take the stubborn stand to push forward on his measures to restore free and fair trade for all good people of America.

President Trump knows it’s “do or die” for our great nation right now. He’s fighting for ‘America First” and this will be his hill to die on or the one that secures ultimate victory for the United States of America. President Trump won’t go wobbly and we should not expect otherwise.

In the past week, President Trump has suggested he would demonstrate “flexibility” over reciprocal trade concerns with other nations. He had even implemented a ‘90 day’ pause’ for all countries that had not responded to ‘Liberation Day’ by raising tariffs on US imports.

President Trump was implementing his stress test on the world. He was closely monitoring their responses. The countries that didn’t over-react and called for further compromise on trade issues with the US would be rewarded.

And President Trump is making good on his pledge to demonstrate “flexibility” and to encourage a spirit of “flexibility” from all other nations.

We should also understand that the Trump administration had long anticipated that China would take the exact opposite approach in response to ‘Liberation Day’ by raising tariffs on US import. Trump knew China would fight back with a resolute will even if all other countries start to back away from Beijing.

And that’s ok. President Trump has reaffirmed that he understands China’s position here and doesn’t blame them. He blames his predecessors - former US presidents - who had signed crooked and totally unfair trade deals with China.

Think of it from this framework, if you are having negotiations and the other side offers generous incentives, why would you refuse such a proposal? You would be eager to accept it and sign the contract without any hesitation.

Yet, President Trump is telling China and the rest of the world that the USA will no longer support such unfair trade practices and imbalances. ‘America First’ is all about making the USA stronger and more prosperous for all Americans.

Meanwhile, I’m reminded of a brilliant poem by Rudyard Kipling, who wrote a letter to his son. It’s called, “If:”

“If you can keep your head when all about you  

    Are losing theirs and blaming it on you,  

If you can trust yourself when all men doubt you,

    But make allowance for their doubting too;  

If you can wait and not be tired by waiting,

    Or being lied about, don’t deal in lies,

Or being hated, don’t give way to hating,

    And yet don’t look too good, nor talk too wise:

If you can dream—and not make dreams your master;  

    If you can think—and not make thoughts your aim;  

If you can meet with Triumph and Disaster

    And treat those two impostors just the same;  

If you can bear to hear the truth you’ve spoken

    Twisted by knaves to make a trap for fools,

Or watch the things you gave your life to, broken,

    And stoop and build ’em up with worn-out tools:

If you can make one heap of all your winnings

    And risk it on one turn of pitch-and-toss,

And lose, and start again at your beginnings

    And never breathe a word about your loss;

If you can force your heart and nerve and sinew

    To serve your turn long after they are gone,  

And so hold on when there is nothing in you

    Except the Will which says to them: ‘Hold on!’

If you can talk with crowds and keep your virtue,  

    Or walk with Kings—nor lose the common touch,

If neither foes nor loving friends can hurt you,

    If all men count with you, but none too much;

If you can fill the unforgiving minute

    With sixty seconds’ worth of distance run,  

Yours is the Earth and everything that’s in it,  

And—which is more—you’ll be a Man, my son!”

Footnotes

Poetry Foundation, “If,”

https://www.poetryfoundation.org/poems/46473/if---    

 (Tom Pauken II., author of US vs. China: From Trade Wars to Reciprocal Deal, AFAI Senior Fellow, Geopolitical Consultant based in Beijing, China) 

X:  @tmcgregochina