Macroscope | Trump’s tariff weapon may amount to little in a changed world
US-China decoupling and trade diversification across the Asia-Pacific mean Trump’s tariffs are no longer capable of mass destruction
The world seems to have become obsessed with tariffs since Donald Trump won the US presidential election on November 5. Tariffs are being seen by many as a main pillar of his foreign policy and a weapon of economic mass destruction. The reality is more complex – and intriguing.
What if, for example, the president-elect’s disdain for multilateral trade agreements and his desire to make America great again behind tighter trade and immigration borders leads him to embrace non-economic forms of internationalism rather than retreat into isolationism?
That might not be good for global trade and economic growth in the shorter term but it could secure a more stable international environment in which risks to world peace could be addressed and existential threats of hot wars and a hot planet tackled.
Trump is “Mr Tariff Man” in the eyes of many commentators but this is at least partly a reflection of their obsession with economic growth and failure to grasp that, with autocratic leaders, it is the spirit that matters as much as, or even more than, the letter.
