What did Donald Trump do today?
He got his bluff called on tariffs yet again, this time by India.
Trump has been at pains recently to at least appear to be trying to exert some influence over the Putin regime, which has been embarrassing him by refusing to even entertain his plans for a Trump-branded peace treaty. (Putin believes, probably correctly, that Russia can defeat Ukraine outright as long as the Trump administration keeps the United States from providing aid to its ally.)
But because Trump is personally and financially beholden to Russia, he's also been unwilling or unable to do anything about it. Earlier this week, he hit on a novel solution: sanction another country for doing business with Russia. Or, more accurately, he promised to punish Americans who do business with India because India does business with Russia As part of his blizzard of tariff announcements on Wednesday, he said on his private microblogging site that there would be an additional unspecified "penalty" tax imposed on American consumers of Indian goods as long as India buys Russian oil.
Trump said yesterday that he had "heard" that India was complying with his demands.
Today, the Indian government chose what has become the dominant strategy in dealing with Trump's seemingly random and rarely executed trade decrees: they called his bluff. The oil trade isn't between the two national governments, but private companies, and Indian officials told reporters today that they had no intention of interfering in the long-term contracts that Indian companies had made to import Russian oil.
In other words, Trump was essentially demanding that India nationalize its oil industry in order to comply with a policy he announced in a late-night tweet.
To be sure, the extra taxes Americans pay on imported goods because of Trump's tariff decrees are, to some extent, going into effect. U.S. consumers are already seeing the effect of triple the former tax collection on everything from the raw materials used in housing construction to groceries to pharmaceuticals to cell phones. At least until a court says otherwise—something that seems fairly likely in the next few months—Trump's words have real consequence.
But the "deals" he's announced involving vague promises of foreign investment have mostly been shams and, without exception, have no legal effect. The real intention seems to be to allow Trump to save face and burnish his image as a "dealmaker."
Why does this matter?
- It's hard to bluff when no one takes you seriously.
- Americans' economic security is more important than making Donald Trump look like a tough negotiator.
- A president who wanted to punish the Putin regime would punish the Putin regime.