June 10, 2019


Only the Best Deals: How Trump Got Pantsed By Mexico (PHILIP ROTNER, JUNE 10, 2019, The Bulwark)

The threat of imposing an immediate 5 percent tariff on Mexican goods, and then gradually ratcheting up the rate to 25 percent, was never real. The stock market hated it. The Chamber of Commerce and other U.S. business groups hated it. American consumers hated it. American manufacturers and farmers hated it. Even Mitch McConnell and Ted Cruz hated it.

The prospect of Trump dropping that stink bomb into the U.S. economy in the run-up to a presidential election year was always a non-starter. Not even Trump is that stupid.

And the Mexican government isn't stupid, either. They fully understood that Trump's only way out of the box he had put himself in was to find a way, any way, to withdraw his tariff threat by claiming that it had successfully forced Mexico to negotiate an immigration deal favorable to the United States.

But far from creating negotiating leverage, Trump's threat did the opposite: It immediately handed all of the leverage to Mexico.

While Trump might have created some leverage with his tariff threat had anyone believed he would follow through on it, everyone--including the Mexican government--knew he couldn't. They knew that Trump had to find a way to declare victory to give himself political cover for when he inevitably withdrew the threat.

Which meant that Mexico had Trump over a barrel. Trump's had two choices: to agree to whatever cosmetic arrangement Mexico was willing to offer; or to follow through on a threat that would be tantamount to political suicide.

Posted by at June 10, 2019 1:49 PM