Trump: Come to think of it, maybe Canada and Mexico could be exempt from the tariffs

The greatest hope of those of us who know protectionism is folly has been that President Trump is taking a negotiating pose with his insistence that he's going to impose tariffs on steel and aluminum imports from every country in the world. That would be a pretty Trumpian thing to do, with the real objective being to get them to negotiate better overall trade deals. Imposing steel tariffs on Canada is an especially disastrous idea, since they are our number one source of imported steel, with more than 10 times the steel coming from Canada as from the hated boogiemen in China. Is this really about nothing more than getting our continental neighbors to the table on a new and improved NAFTA?

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For the first time this morning, the dam seems like it might be breaking:

U.S. President Donald Trump on Monday appeared to suggest that Canada and Mexico could win exemptions to his planned sweeping tariffs on steel and aluminum if the two countries sign a new NAFTA trade deal and take other steps. He made the comments as the United States, Canada and Mexico were wrapping up their latest round of talks on revamping the 1994 NAFTA deal, and as U.S. and world shares dipped again, partly on concerns that Trump’s tariff plan could spark a global trade war. “We have large trade deficits with Mexico and Canada. NAFTA, which is under renegotiation right now, has been a bad deal for U.S.A. Massive relocation of companies & jobs. Tariffs on Steel and Aluminum will only come off if new & fair NAFTA agreement is signed,” Trump tweeted. A representative for the White House did not immediately respond to a request for comment on the president’s statement. Trump has touted the planned tariffs, which he announced last Thursday, as a way to revive the U.S. steel and aluminum industries. White House Director of Trade and Industrial Policy Peter Navarro repeated this point on Monday, telling Fox News,“As the president said, we can’t have a country without an aluminum and steel industry. However, Navarro indicated he had not seen Trump’s tweets on Canada and Mexico being exempted if a NAFTA deal was achieved. “That would be a great thing for the American people, but at this point in time 25 percent on steel, 10 percent on aluminum, no country exclusions - firm line in the sand,” Navarro said.

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The whole "firm line in the sand" business almost sounds like a scripted negotiating position. When else does the White House talk like that about anything? When does Trump talk like that, unless he's trying to muscle someone into a better deal than the one he thinks is on the table? At this point, I certainly hope that's what's going on here, but the problem - as any skilled negotiator knows - is that when you threaten to do something to get the other party to the table, you have to be prepared to go through with it if the other party balks. If Trump is prepared to go through with a trade war against Canada, he's going to cause a great deal of economic tumult in order to solve a problem that doesn't even really exist. Buying relatively cheap steel and aluminum from Canada is a good thing for the United States. It gives steel-consuming industries a dependable supply line while allowing them to control production costs, thus maintaining the flow of popular consumer products at affordable prices and maintaining employment levels. Adding 25 percent to those sourcing costs as a favor to U.S. Steel is going to help a lot more people in the United States than it hurts, with no real benefit gained by anyone. Right now, thanks to some very good economic decisions by President Trump, the economy is poised to boom this year like it hasn't in a very long time. If the president sabotages that growth by starting an unprovoked trade war with one of our closest allies, he will have no one but himself to blame. Back away, however you need to do it. And quickly.

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