'The disruptor in chief': Trump's tariffs-as-leverage ploy is working, says Peter MacKay
Despite the uncertainty facing several countries on what Donald Trump’s next tariff move will be, the U.S. president’s strategy of using levies as a leverage tool is proving to be beneficial for the American economy, according to former Canadian foreign affairs minister Peter MacKay.
“His strategy of going after other countries’ economies, trying to use tariffs very much as a leverage tool has been working. Now, how long it will work and how much long-term damage that this will do to not only relationships but to businesses, to certain sectors of the economy, is yet to really be gauged,” said MacKay, who is now a partner at law firm Baker McKenzie, in an interview with BNN Bloomberg Tuesday.
“But for the president going into an electoral cycle starting really this fall or before Christmas, this has been very advantageous to the economy of the United States of America – and that’s what his focus has been from the start.”
In the Trump administration’s latest tariff threat, it expanded the list of European Union products it could target on Tuesday amid a transatlantic subsidy dispute between Boeing Co. and Airbus SE.
“It’s further evidence of the ‘disruptor in chief.’ I think the president is not happy unless somebody is unhappy,” MacKay said. “But let’s be clear: he has been very effective in terms of his efforts to reset the table vis-à-vis trade imbalances – that is, deficits that are very real for the United States of America. In the meantime, their economy is booming.”
Trump has targeted other major economies with retaliatory tariffs like China. However, the two countries reached a trade truce over the weekend at the G20 summit as Trump said he would hold off indefinitely on tariffs planned for an additional US$300 billion in Chinese imports.
The U.S. president has also used tariffs as a leveraging tool against Mexico in an effort to stop migrants from illegally crossing over the border, and temporarily imposed steel and aluminum tariffs on Canada last year.“He has a fair bit of success with China, we have to begrudgingly give him that,” MacKay said. “[Canada] of course, in some cases, is paying a price for his success.”