Trump’s Warning Shot on Trade Risks Igniting a Wider Conflict<br />Though Mr. Trump stepped back from plans to impose tariffs on every nation — exempting, for the time being, Canada and Mexico — he did so while exerting additional pressure: He emphasized<br />that tariffs could ultimately land on both countries unless they bend to American demands in renegotiations of the North American Free Trade Agreement.<br />Faced with a rebuke from the global trading body, Mr. Trump might pull the United States out of the institution.<br />Mr. Trump’s decision to back off from across-the-board tariffs came in the face of strident warnings from the American business world and leaders of his own Republican Party<br />that such a course would damage the American economy and alienate allies.<br />“You put a premium on doing damage rather than deterring bad behavior.”<br />Mr. Trump and his advisers appear to be calculating that, as the largest economy on earth,<br />the United States possesses enough muscle to dictate the terms of world trade.<br />“The level of tension between the United States and its major trading partners is probably more tense than it has been at any<br />time since the early 1980s,” said Meredith Crowley, an international trade expert at the University of Cambridge in England.<br />Mr. Trump maintains that Americans have been outwitted by savvier trading partners, with tariffs needed to force jobs to return to the United States.<br />“They are under the delusion that the United States has been screwed by the global system that it created,” Mr. Posen said.
