Everyone Is on Edge at the G7 As Trump Disrupts Global Trade

By David Boddiger  |  August 24, 2019 | 7:21pm
Trumpland

The “Great Disrupter” Donald Trump certainly is ensuring he gets the
attention he so desperately craves as this weekend’s Group of 7 summit
gets underway in southern France.

Trump on Friday launched into a tirade against China,
announcing more tariffs on Chinese goods after China had announced similar, albeit less severe, measures on U.S. exports. Trump said he plans
to raise tariffs from 25% to 30% on $250 billion of Chinese goods, and from
10% to 15% on an additional $300 billion of goods that have yet to be placed under
tariff, according to The Washington Post.

That move responded to an earlier announcement by China that
it was imposing new tariffs on about $75 billion in U.S. goods, including auto
products.

Trump’s rant on Friday, which extended over nearly a dozen tweets and criticized both Chinese President Xi Jinping and Trump’s
own handpicked Federal
Reserve Chairman Jerome Powell, also “ordered” U.S. companies to “immediately”
begin pulling out of China’s market, which encompasses some 1.4 billion
consumers. To state the obvious, that’s an insane order.

The Post reacted
to that by writing, “The White House does not have the authority to force
companies to follow such directives, and Trump’s demand came under sharp and
immediate criticism from the U.S. business community, which warned that halting
sales with such a large trading partner would hurt American companies and the
broader economy.”

Trump doubled down on the threat late Friday, citing a
national security law called the International Emergency Economic Powers Act of 1977.

“For all of the Fake News Reporters that don’t have a clue
as to what the law is relative to Presidential powers, China, etc., try looking
at the Emergency Economic Powers Act of 1977. Case closed!” he tweeted.

The act states that, “Any authority granted to the President
by section 1702 of this title may be exercised to deal with any unusual and
extraordinary threat, which has its source in whole or substantial part outside
the United States, to the national security, foreign policy, or economy of the
United States, if the President declares a national emergency with respect to
such threat.”

According to The New
York Times, presidents have declared 54
national emergencies under that law, including those targeting “international
terrorists, drug kingpins, human rights abusers, cyber attackers, illegal arms
proliferators, and multinational criminal organizations.”

Examples include Iraq’s invasion of Kuwait in 1990, Serbian
troops sent to Kosovo in 1998, and Russia’s annexation of Crimea in 2014. Other
targeted countries include North Korea, Sudan, Somalia, Yemen, Syria, Congo,
and Venezuela, according to the Times.

Of course, Trump loves to bluff, as the newspaper pointed
out, including past threats to shut
down the southern U.S. border and impose tariffs on goods
imported from Mexico over the immigration issue. Neither of those threats came to fruition.

And following through with such an order against U.S. companies, again, would be insane.

“Any invocation of the International Emergency Economic
Powers Act in these circumstances and for these purposes would be an abuse,” Daniel
Price, a former international economic adviser to President George W. Bush,
told the Times. “The act is intended
to address extraordinary national security threats and true national
emergencies, not fits of presidential pique.”

Trump also has threatened European allies, including France,
over a digital
services tax that the U.S. administration feels unfairly targets tech
companies like Google, Facebook, Amazon, and Apple, among others, Politico
reported. Trump threatened to tax
French wine in retaliation.

“I don’t want France going out and taxing our companies.
Very unfair,” Trump said, according to Politico. “And if they do that, we’ll be
taxing their wine or doing something else.”

All of this occurs as Germany faces a possible recession and
Britain sorts
out its future in light of the Brexit fiasco. Germany’s economy is highly
dependent on China, and an economic slowdown in China—which already is
happening—would have a bad effect on Europe.

To make matters worse, Trump in the recent past has threatened tariffs on European goods, too.

European Council President Donald
Tusk urged Trump to avoid such tariffs.

“Trade wars among G7 members will lead to weakening the already
eroding trust among us,” he said, according to Politico. “If the U.S. imposes
tariffs on France, the EU will respond in kind … We have to be ready for this
bad scenario.”

 
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