News & Politics

'Trump and His Advisers Still Don’t Get It': Paul Krugman Explains How the White House Turned the World Against the U.S.

"They remain blithely ignorant about what they’re getting into."

Photo Credit: Bloomberg YouTube screencap

While many other issues are dominating the headlines — the Supreme Court, immigration, and developments in the Russia investigation — the slow burn of the United States' looming trade war may become one of the most significant stories in the months to come.

As Paul Krugman explained Monday night, Trump's team appears to be completely bungling their handling of the issue.

"Trump and his advisers still don’t get it," he writes. "They remain blithely ignorant about what they’re getting into."

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For example, when Trump initially decided to start slapping tariffs on foreign governments' goods, White House trade czar Peter Navarro said he didn't think any country would retaliate.

He was wrong. Krugman explains:

On Sunday, Canada — a country that, by the way, imports about as much from us as it exports in return — announced retaliatory tariffs against $12.6 billion of U.S. products.

The European Union and China have also announced retaliatory tariffs. Mexico, with its new leftist president-elect, is hardly likely to be accommodating. And the E.U. has warned that it will go much bigger if Trump follows through on his threat to put tariffs on European cars, potentially imposing retaliatory tariffs on almost $300 billion of U.S. exports.

When Trump tried to say Monday that it's not a big deal if the trade dispute with the EU continues, Dutch Prime Minister Mark Rutte literally laughed in his face.

Krugman warns that consequences of these disputes affect the structure of world trade: "The U.S. is now behaving in ways that could all too easily lead to a breakdown of the whole trading system and a drastic, disruptive reduction in world trade."

Trump, he says, is essentially having a "temper tantrum" as he's demanding concessions from countries they can't make — because he's invented problems that don't exist.

And in addition to the negative economic consequences, Trump's posture toward the rest of the world makes it less likely that the United States' allies will be there when it needs them. And as powerful as the U.S. is, it can't go it alone.

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Cody Fenwick is a reporter and editor. Follow him on Twitter @codytfenwick.