As he prepares to introduce new tariffs to foreign metals this week, President Trump vows not to grant him the types of exclusions and exemptions that were common during the First Trade War.
But he has weakened the tough position of other tariffs. Mr. Trump quickly withdrew his comprehensive tariffs on all imports from Canada and Mexico on Tuesday after lobbying from automakers, farmers and other industries. By Thursday, he suspended tariffs on all products compliant with the North American Free Trade Agreement, the U.S.-Mexico-Canada Agreement or the USMCA, about half of which are imported from Mexico, while nearly 40% of products from Canada.
This has allowed industry and foreign governments to open up governments before lobbying metal tariffs and will take effect at 12:01 a.m. Wednesday, as well as other taxes planned for April 2.
Foreign officials have been urging their steel and aluminum exemptions. At a meeting in Washington on Monday, Japan’s trade secretary is expected to seek tariffs on cars, and Mr. Trump said it will be launched in April.
Ford Motor, General Motors and Stralandis bought the vast majority of its steel and aluminum in the U.S. or North America and were concerned about the impact of the tax, Matt Blunt, chairman of the U.S. Automotive Policy Committee, a trading group representing U.S. automakers, said in a statement.
Mr Blunt said the two companies are reviewing and awaiting details of the proposed tariffs but are “concerned” about levieding them in Canada and Mexico, which would “add huge costs to our suppliers.”
Whether Mr. Trump will provide exceptions to metal taxes or tariffs on futures, such as cars and other products, which he said will be launched in April, remains to be seen. But the charm of cutting the deal can be a tough thing to the president’s resistance. Granting the capacity of a preferred industry or foreign government relief highlights one of the president’s favorite things about tariffs: the direct impact they have on him.
By threatening or imposing tariffs and then proposing tariffs, the President repeatedly appeases companies and countries affected by tariffs, puts it on him, and invites his praise and compliance. Foreign countries have proposed to start trade negotiations and provide resources for Mr. Trump’s goals, such as strengthening the U.S. borders. This is a power that the president may not want to give up.
“That’s what the authoritarians do – manipulating public policy and controlling it through personal decisions and seemingly trait-like decisions, often in order to gain political support or seek political support,” said Rick McGahey, an economist at the new school.
Last week, GM, Stellantis and Ford executives told the president over the phone that tariffs on signing cars and parts from Canada and Mexico could have devastating consequences, including imposing billions of dollars in new fees and effectively eliminating profits from all companies.
They made a positive statement when Mr. Trump granted them a 30-day probation on Wednesday. GM “thanks to the president for his approach, which allows American automakers like GM to compete and invest domestically.” Ford said that this is “thank you President Trump for his work in supporting our industry.”
On Wednesday, Vice President JD Vance suggested that the exclusions would not outperform the automakers, saying the president “want a wide range of tariffs”.
“He doesn’t want to own 500 different industries to get 500 different carvings,” Vance said.
But by Thursday, after a week of stock market turmoil, the president had released sales of all commodity transactions under USMCA terms, including agricultural products, and reduced tariffs on Canadian potash from 25% to 10%.
The farmers’ return seemed to play a role. State and national associations representing corn and soybean farmers expressed concern about the harm of tariffs on imported fertilizers from Canada. Town Halls in Tennessee and Colorado are organized by Farmers Free Trade, a lobby, farmers and business owners complain that tariffs can raise prices and lower incomes.
“President Trump demonstrates his understanding of farmers by lowering proposed tariffs on Canadian potash,” Sen. Charles E. Grassley, Republican of Iowa, said in a statement.
A familiar discussion said that while Republican opposition to tariffs has been degraded, lawmakers have been trying to convey the message that they will not continue to back down unless they see plans to remove tariffs.
The Trump administration has repeatedly stated that it does not intend to undermine its own measures with exclusion measures. Trump officials said in a call with reporters last month that such deals undermined the effectiveness of metal tariffs.
The president made a similar promise in the case of copper tariffs – writing on social media, “no exemption, no exception!” – and his “reciprocal tariff” plan. Trump said in the Oval Office last month that reciprocity tariffs will be “comprehensively applied for”.
“It’s an easier way, it’s a better way,” the president said.
During his first term, Mr. Trump initially imposed tariffs on steel and aluminum on countries such as China and Russia. Chad Bown, a senior fellow at the Peterson Institute, said he did not put them on most of the metals in the United States, but invited them to negotiate.
South Korea, Argentina and Brazil agreed to limit their export quotas. Canada, Mexico, the EU and others were hit by tariffs and retaliated.
Canada and Mexico then negotiated their own bargains as part of Mr. Trump’s signing at the USMCA. Bowen said that when President Joseph R. Biden Jr.
Mr. Trump may be open to his own personal deals, but does not establish a formal exclusion system as he did in his first term. At that time, the company eventually applied for hundreds of thousands of taxes with the help of a high-priced K street law firm in Washington.
The U.S. Trade Representative’s Office handled the rights to exclude Chinese tariffs, making more than 50,000 requests, while the Department of Commerce received nearly 500,000 requests to exclude tariffs on steel and aluminum.
Some lawyers and companies say the exception is still not needed because not all the parts and raw materials they have to use are made in the United States.
But some of Mr. Trump’s supporters are continuing to fight any immunity that will dilute tariff powers.
Nick Iacovella, executive vice president of the American League, said the Trump administration “correctly recognizes that global steel and aluminum tariffs must be comprehensive and include downstream derivatives as effective.”
The team’s analysis shows that past waivers “severely weakened U.S. steel and aluminum producers, consumed thousands of jobs and undermined our economic security.”
In a letter Monday, five steel groups wrote about their support for tariffs and their objections to any exclusions from them.
The exclusion process, they wrote, “has been exploited as a loophole by foreign producers who have tried to avoid tariffs.”
Jack Ewing Contribution report.
