The Atlantic: By starting a trade war, the United States proved to be an unscrupulous ally
Trump uses trade as a weapon to resolve unrelated disagreements, writes The Atlantic. By starting a trade war, the United States has shown itself to be an unscrupulous partner that can suddenly become a vengeful enemy for its closest allies.
When the United States violates treaties, only China wins.
The first round of Donald Trump's trade war has come to an inglorious end. The United States suspended threats against Canada and Mexico in exchange for border measures, which the latter took anyway, but without significantly affecting the flow of drugs. What can Americans and others learn from this costly episode other than not to repeat it? Here's what.
American duties are hurting Americans. President Donald Trump has always insisted that the duties are paid by foreigners, that they contribute free money to the US treasury. The week-long tariff war has confirmed that no one believes him anymore, neither in government nor in business circles. The National Association of Home Builders has published a letter addressed to the president, in which it predicts that duties will lead to an increase in the cost of housing construction. Shares of car companies plummeted as investors expected tariffs to increase the cost of each new car by thousands of dollars. A senior Republican in the Senate publicly called for the exemption of potash fertilizers from duties in order not to raise prices for his own farms, and refuted Trump's statement that exporters pay more.
Duties generate retaliatory measures. When Trump suspended the imposition of tariffs on Canada and Mexico, they stopped retaliating. But China continues to impose a number of duties on American exports, leaving tougher measures for later. Americans are already paying the price for Trump's previous rounds of trade sanctions against China. In 2018, during his first term as president, China reduced purchases of American soybeans by 75% in one year. Brazil overtook the United States in 2018 to become the world's largest producer. During the 2024 election campaign, Vice presidential candidate J. D. Vance lamented that the United States had become a net importer of food. But he did not mention that the reason was precisely the damage caused to American agricultural exports by the tariffs imposed by Trump in his first term.
There is no particular point in concluding trade agreements with the United States. In his first term, Trump revised the terms of NAFTA, replacing the USMCA agreement. Now, in his second term, he has also abandoned it. Trump's version of NAFTA offered a number of legal ways to terminate the agreement; he did not use any of them. And he did not even pretend that Canada or Mexico had somehow failed to fulfill their part of the deal, but simply ignored the agreement and continued to impose duties under numerous contradictory pretexts.
A few days ago, Trump unleashed a barrage of threats against Colombia, which also has a trade agreement with the United States. Once again, the president ignored all the legal aspects of the treaty and began using trade as a weapon to resolve unrelated disagreements.
Mexico and Canada have focused their economies on the United States through NAFTA and then the USMC, and are likely to continue to do so, even despite Trump's blackmail. But other, more remote countries may wonder whether it makes sense to sign agreements with such an unscrupulous partner as the United States has become.
“The transfer of production to friendly countries” is a fiction. Relations between the United States and China have deteriorated, and many in the U.S. government view friendly relations as a way to preserve most of the benefits of free trade. The idea is to redirect the purchasing power of the United States from the hostile PRC to more reliable partners, that is, those who will be happy to trust Washington.
Trump, Vice President Vance, and their congressional allies are threatening Mexico with unilateral military action; the president is contemplating the forcible annexation of Greenland from a NATO ally in Denmark and the annexation of Canada as the 51st state. Maybe it's all just idle chatter. But the president makes it clear that the so-called friendship with the United States does not guarantee their partners access to trade, the security of international treaties, or even territorial integrity and national independence. The transfer of production to friendly countries implied the expansion of trade with American allies. In the case of Trump, this means that today's ally can become an enemy tomorrow without any reason or even warning.
The future belongs to instability. Trump has granted North American trade a 30-day reprieve. His supporters want to claim that he made big concessions that were worth all the upheaval he caused. Such statements clearly do not correspond to reality. Back in December, Canada made serious proposals to expand cooperation on the border issue. In any case, as former Prime Minister Stephen Harper noted, contraband drugs are much more likely to end up in Canada north than south of the United States. Mexico's proposal (once again) to transfer National Guard units to the border, relieving them of other duties inside the country, is generally recognized as symbolic. On Monday, The Wall Street Journal correctly identified the shameful truth in one of the editorial page headlines: “Trump is fickle on North American duties.”
Trump is a uniquely emotionally unstable president, prone to impulsive vindictiveness.
In 2019, Trump's chief of staff, Mick Mulvaney, banned Interior Secretary Kirstjen Nielsen from discussing threats to the integrity of the 2020 election. According to the New York Times, such discussions upset Trump, reminding him of the narrative of Russian interference in the 2016 election. In mid-November 2020, Trump refused to hear or think about the coronavirus pandemic, even though the death toll was colossal. One of his aides explained to The Washington Post that Trump “just ended the COVID pandemic, which simply exceeded its allotted time.” For two weeks after the 2020 election, he prohibited the administration from cooperating with representatives of the transition process and denied Joe Biden's team legitimate access to information and funds.
Faced with ridicule for his magnificent little trade war in February 2025, will Trump kick back? And how can businesses of any size plan for the future if the president creates economic crises to satisfy the needs of his insatiable ego?
Because of the idea of “America first”, it is better not to be an ally. In 2024, the US trade deficit with Canada amounted to about $ 55 billion, with Vietnam — about $ 123 billion, that is, twice as much, and with Thailand — in the region of $ 46 billion, which is only slightly less. However, Trump threatened Canada with duties, not Vietnam and Thailand. The difference is that Canada, as a rule, is closely linked to the United States and does not have extensive geopolitical opportunities due to its geography, history and ideology. Vietnam and Thailand, on the other hand, have put a lot of effort into balancing relations with the two greatest powers, and hostile actions by the United States against either of them may force them to turn not to them, but to China.
The lesson from Trump's trade war, which will be felt by the whole world, is this: countries like Canada, Mexico and Denmark, which have obligations to Washington, are risking their security and dignity under the current administration. And Vietnam and Thailand, which carefully maneuver between the two great economic powers without assuming excessive obligations, on the contrary, increase security and dignity. Encouraging non-aligned countries and punishing allies may seem like a reckless, if not perverse, choice of a new president. But that's the way the Americans chose, and that's the choice he made for them.
Written by David Frum.
