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Friday, June 01, 2018


The Great Negotiator

by Tom Sullivan

It has been clear from the outset of Donald Trump's excellent adventure he is developmentally challenged, emotionally arrested, uninformed and mean. A walking id. His understanding of the world is utterly zero-sum. The rest of the world has to bow before him so he can win.

Canada and the European Union are some of America's greatest and most faithful allies, not only in trade, but in security. So upon hearing of their response to new tariffs on steel and aluminum announced yesterday by the Donald Trump administration, this exchange from The Avengers sprang to mind:

Tony Stark : ... and YOU, big fella, you've managed to piss off every single one of them.

Loki : That was the plan.

Tony Stark : Not a great plan.
The EU, Canada, and Mexico immediately announced retaliatory tariffs on U.S. goods. The EU announced plans to take the U.S. to the World Trade Organization's "trade court" to have Trump's actions declared illegal.

Catherine Rampell writes in the Washington Post that his view of trade echoes the mercantilists of the 17th and 18th centuries before there was an America to be great:
Like an 18th-century mercantilist, Trump perceives no mutual gains from trade. In any transaction, he sees only a winner and a loser. And the winner is determined by who has the trade surplus.

Since there’s no way everyone could come out ahead, there’s no point in trying to create a system of rules oriented toward that outcome. Plus, he seems to believe everyone’s going to cheat anyway — including, and perhaps especially, our supposed friends.
So Trump is starting a trade war with them, labeling it a national security matter. Trade wars, as he's told us confidently, are "good, and easy to win."

Trump, Rampell continues, turns out to be as lousy a mercantilist as he is a negotiator. By protecting U.S. aluminum and steel, he is taxing inputs domestic manufacturers need to produce higher-value finished goods for export.
And steel and aluminum are hardly alone in this respect. In April, after Trump announced a list of 1,333 Chinese products that could be subject to tariffs, Peterson Institute for International Economics senior fellow Chad Bown found that about 85 percent of them were intermediate inputs and capital equipment.
Quoting Keynes, Rampell writes that men who fancy themselves independent thinkers are usually just slaves to some defunct economist. Trump cannot even get his anachronisms right.

Nor can the self-described dealmaker make deals. He's proven better at breaking them than making them, John Lauinger and Pradnya Joshi write at Politico. Tony Schwartz, ghostwriter for Trump's "The Art of the Deal," received half the $500,000 advance and half the royalties with little haggling:
Now Trump is the president. And the people who know him and have worked with him and the experts who have studied his negotiating skills are unsurprised he’s having some trouble in his new role.

“He’s dealing with people that aren’t just trying to make money,” [biographer Gwenda] Blair said. “They’re elected politicians, heads of state, that have their own very demanding constituencies. It’s really very different than a strict dollars-and-cents motivation that he was dealing with before.”

“It takes a tremendous amount of knowledge and experience to get all these people to come together for a common goal. He doesn’t have any experience doing that,” [Bruce Nobles, the former president of the Trump Shuttle] said. “He just assumed his force of personality would cause people to forget politics. And that’s not the way it works.”
Trump just doesn't get it, negotiation expert Marty Latz tells Politico. Trump relies on the power of positive thinking rather than on competence. If you keep saying something you will make it happen, or else spin what happens as what you wanted all along.

"If you knock Donald on his ass, he will tell you the best position to be in is on your ass," Latz says.

With his start-up trade war, a lot of Americans who trusted Trump to cover theirs may find themselves knocked on theirs with him, and pumping their fists about how great it feels.

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For The Win 2018 is ready for download. Request a copy of my county-level election mechanics primer at tom.bluecentury at gmail.