Trump's trade battle challenges his appetite for political risk
His absence of a solid strategy has created uncertainty, resulting in markets in disarray.
TroibNews 
President Donald Trump’s trade war with Canada and Mexico has always posed a challenge regarding his tolerance for political risk.
Just two days into the tariffs, his announcement of a carve-out for automakers has left industries, market analysts, and consumers bewildered as they try to anticipate his next moves.
In response to a quick market backlash, Trump on Wednesday revealed a one-month reprieve for autos and auto parts from the harsh 25 percent tariffs he imposed the day before. This decision indicated a willingness to consider appeals from other industries for further exemptions to the tariffs on Mexico and Canada. This approach starkly contrasts with how he expects American consumers to bear the burden of higher prices resulting from the tariffs, all in the name of potential long-term economic benefits.
“I don’t know what the administration’s plan is,” said Sen. Rand Paul. “If they’re using [tariffs] as leverage, seems to me it would be better to threaten them, negotiate and you put them on or not on.”
These conflicting actions highlight Trump's dual motivations: a longstanding concern about stock market fluctuations — which he perceives as ratings for his performance — and his preference for using tariffs as a key tool to achieve his objectives with foreign governments.
This internal conflict was evident among Trump’s advisers, who spent much of Wednesday discussing the extent to which they might alleviate the trade war's impact on American industries and consumers.
“It's the greatest show on Earth. We'll put tariffs on tonight, but tomorrow we’ll tell you we may negotiate and take them off,” remarked a person close to the administration, who requested anonymity to disclose internal discussions. “But stay tuned, because you never know what tomorrow's gonna bring.”
The self-generated economic uncertainty comes at a time when Americans are anxious about rising prices, with polls indicating that they feel the administration isn't doing enough to tackle economic challenges, despite satisfaction with its performance on other issues. The situation is further complicated by growing concerns on Capitol Hill, particularly among Republican senators from agricultural states who fear the local economic repercussions of the tariffs.
Additionally, there is confusion regarding whether the newly implemented tariffs on Canada and Mexico are solely focused on curbing the flow of fentanyl into the U.S. — a sentiment more strongly emphasized by Trump's aides than by Trump himself — or are indicative of a broader protectionist agenda. These new tariffs serve as a precursor to more extensive reciprocal tariffs slated to take effect on April 2, and even many of Trump's close allies are unclear about what actions Canada and Mexico could take to have the tariffs lifted entirely.
“The problem with using them as a negotiation also is that they negotiated: Mexico gave them something, and then they still put them on,” added Paul. “It doesn’t look like an honest negotiation.”
During a Wednesday afternoon press briefing, White House press secretary Karoline Leavitt pointed to fentanyl seizures at the northern border from the past fiscal year as justification for the tariffs on Canada but did not specify what future actions the country’s northern neighbors could take. Despite Canadian Prime Minister Justin Trudeau noting that fewer than 1 percent of illegal crossings and fentanyl seizures occurred at the Canadian border, Canada is proceeding with plans to invest $1.3 billion in border security.
Simultaneously, Trump has done little since taking office to alleviate Americans’ worries about rising prices. In his Tuesday night address to Congress, he pointed to substantial corporate investments, reduced energy costs, and cuts in government spending as his main strategies to lower inflation — strategies that may be undermined by his own tariffs.
In a rare acknowledgment of the need for sacrifice, the typically sales-focused president acknowledged that the tariffs would cause “a little disturbance” to prices while assuring long-term economic benefits.
“Last night the president told the truth, and he was realistic, and he level set with the American people,” Leavitt asserted. “It is very refreshing, and everyone in this room should be very grateful that we have a president who tells the truth about the reality of the economic situation that we are in.”
On Wednesday, stock markets rallied both in anticipation of and following the president’s softened stance toward the tariffs on Canada and Mexico. However, trade experts cautioned that the administration's actions are merely a temporary pause and highlighted the ongoing uncertainty and confusion created by its fluctuating trade announcements over the past 40 days.
"Obviously a pause is welcome, but this constant ‘on again-off again’ of tariffs is difficult for companies that are trying to make sourcing and pricing decisions in real time,” said Tiffany Smith, vice president for global trade policy at the National Foreign Trade Council, a pro-free trade group.
Kyle Johnson, director of trade policy for the Information Technology Industry Council—which represents global tech firms including Google, Microsoft, Meta, Amazon, and Apple, as well as major chipmakers like Intel and Taiwan’s TSMC—expressed concerns that the unpredictable economic landscape could hinder the U.S.'s competitiveness.
“Businesses rely on stability and certainty in order to innovate and compete,” Johnson remarked.
This uncertainty was particularly evident on Wednesday as Trump’s two top aides—Commerce Secretary Howard Lutnick and White House trade adviser Peter Navarro—appeared on television conveying conflicting messages about the administration’s trade strategy. Shortly after Lutnick hinted on Bloomberg TV at the forthcoming auto carve-outs aimed at calming market fears, Navarro appeared on CNN, downplaying the market reactions to the trade war.
“We've had two days of volatility in the markets, and everybody's hair is on fire,” Navarro remarked.
Their differing messages highlight the divisions within the White House on trade, with one faction pushing for a hardline protectionist outlook aimed at bolstering domestic industries, while another reacts to market conditions and the implications for consumers and businesses reliant on global supply chains.
Lutnick found himself aligned with Treasury Secretary Scott Bessent and National Economic Council Director Kevin Hassett to attempt to roll back the tariffs on Canada and Mexico, as noted by the close administration insider.
“If you put a gun to his head, Lutnick’s on the no-tariff side, believe it or not,” the individual explained.
Moreover, Trump has remained an inconsistent communicator on tariffs, often blending his current push—which the administration describes as related to combating fentanyl deaths—with a broader frustration that he believes other nations are economically taking advantage of the U.S. On Tuesday night, he reiterated that not implementing tariffs equates to the U.S. effectively providing “subsidies” to Canada and Mexico.
“And the United States will not be doing that any longer. We're not going to do it any longer,” he asserted.
At this moment, the president appears unconcerned about alienating some of his key supporters, including the farmers in middle America who have expressed outrage over the tariff decisions. It remains uncertain whether farmers will receive exemptions from these newest duties, especially concerning potash, a vital fertilizer component primarily sourced from Canada—let alone any future tariffs. The agricultural sector is also among the first to face retaliation from other countries in response to increased U.S. tariffs.
“President Trump is president because of rural America. And so I don’t know why you’d want to do anything to make things more difficult, and things are very, very difficult on farmers right now,” said Sen. John Boozman.
Amid the turmoil, the president’s allies in Congress are reacquainting themselves with a phrase they relied on during his first term: Expect the unexpected.
“The strategy — how should I put this — I think the strategy here is devised by him and him alone,” stated Sen. Josh Hawley, prior to the afternoon auto announcement. “Which is typically how it is.”
Doug Palmer contributed to this report.
Frederick R Cook contributed to this report for TROIB News
Just two days into the tariffs, his announcement of a carve-out for automakers has left industries, market analysts, and consumers bewildered as they try to anticipate his next moves.
In response to a quick market backlash, Trump on Wednesday revealed a one-month reprieve for autos and auto parts from the harsh 25 percent tariffs he imposed the day before. This decision indicated a willingness to consider appeals from other industries for further exemptions to the tariffs on Mexico and Canada. This approach starkly contrasts with how he expects American consumers to bear the burden of higher prices resulting from the tariffs, all in the name of potential long-term economic benefits.
“I don’t know what the administration’s plan is,” said Sen. Rand Paul. “If they’re using [tariffs] as leverage, seems to me it would be better to threaten them, negotiate and you put them on or not on.”
These conflicting actions highlight Trump's dual motivations: a longstanding concern about stock market fluctuations — which he perceives as ratings for his performance — and his preference for using tariffs as a key tool to achieve his objectives with foreign governments.
This internal conflict was evident among Trump’s advisers, who spent much of Wednesday discussing the extent to which they might alleviate the trade war's impact on American industries and consumers.
“It's the greatest show on Earth. We'll put tariffs on tonight, but tomorrow we’ll tell you we may negotiate and take them off,” remarked a person close to the administration, who requested anonymity to disclose internal discussions. “But stay tuned, because you never know what tomorrow's gonna bring.”
The self-generated economic uncertainty comes at a time when Americans are anxious about rising prices, with polls indicating that they feel the administration isn't doing enough to tackle economic challenges, despite satisfaction with its performance on other issues. The situation is further complicated by growing concerns on Capitol Hill, particularly among Republican senators from agricultural states who fear the local economic repercussions of the tariffs.
Additionally, there is confusion regarding whether the newly implemented tariffs on Canada and Mexico are solely focused on curbing the flow of fentanyl into the U.S. — a sentiment more strongly emphasized by Trump's aides than by Trump himself — or are indicative of a broader protectionist agenda. These new tariffs serve as a precursor to more extensive reciprocal tariffs slated to take effect on April 2, and even many of Trump's close allies are unclear about what actions Canada and Mexico could take to have the tariffs lifted entirely.
“The problem with using them as a negotiation also is that they negotiated: Mexico gave them something, and then they still put them on,” added Paul. “It doesn’t look like an honest negotiation.”
During a Wednesday afternoon press briefing, White House press secretary Karoline Leavitt pointed to fentanyl seizures at the northern border from the past fiscal year as justification for the tariffs on Canada but did not specify what future actions the country’s northern neighbors could take. Despite Canadian Prime Minister Justin Trudeau noting that fewer than 1 percent of illegal crossings and fentanyl seizures occurred at the Canadian border, Canada is proceeding with plans to invest $1.3 billion in border security.
Simultaneously, Trump has done little since taking office to alleviate Americans’ worries about rising prices. In his Tuesday night address to Congress, he pointed to substantial corporate investments, reduced energy costs, and cuts in government spending as his main strategies to lower inflation — strategies that may be undermined by his own tariffs.
In a rare acknowledgment of the need for sacrifice, the typically sales-focused president acknowledged that the tariffs would cause “a little disturbance” to prices while assuring long-term economic benefits.
“Last night the president told the truth, and he was realistic, and he level set with the American people,” Leavitt asserted. “It is very refreshing, and everyone in this room should be very grateful that we have a president who tells the truth about the reality of the economic situation that we are in.”
On Wednesday, stock markets rallied both in anticipation of and following the president’s softened stance toward the tariffs on Canada and Mexico. However, trade experts cautioned that the administration's actions are merely a temporary pause and highlighted the ongoing uncertainty and confusion created by its fluctuating trade announcements over the past 40 days.
"Obviously a pause is welcome, but this constant ‘on again-off again’ of tariffs is difficult for companies that are trying to make sourcing and pricing decisions in real time,” said Tiffany Smith, vice president for global trade policy at the National Foreign Trade Council, a pro-free trade group.
Kyle Johnson, director of trade policy for the Information Technology Industry Council—which represents global tech firms including Google, Microsoft, Meta, Amazon, and Apple, as well as major chipmakers like Intel and Taiwan’s TSMC—expressed concerns that the unpredictable economic landscape could hinder the U.S.'s competitiveness.
“Businesses rely on stability and certainty in order to innovate and compete,” Johnson remarked.
This uncertainty was particularly evident on Wednesday as Trump’s two top aides—Commerce Secretary Howard Lutnick and White House trade adviser Peter Navarro—appeared on television conveying conflicting messages about the administration’s trade strategy. Shortly after Lutnick hinted on Bloomberg TV at the forthcoming auto carve-outs aimed at calming market fears, Navarro appeared on CNN, downplaying the market reactions to the trade war.
“We've had two days of volatility in the markets, and everybody's hair is on fire,” Navarro remarked.
Their differing messages highlight the divisions within the White House on trade, with one faction pushing for a hardline protectionist outlook aimed at bolstering domestic industries, while another reacts to market conditions and the implications for consumers and businesses reliant on global supply chains.
Lutnick found himself aligned with Treasury Secretary Scott Bessent and National Economic Council Director Kevin Hassett to attempt to roll back the tariffs on Canada and Mexico, as noted by the close administration insider.
“If you put a gun to his head, Lutnick’s on the no-tariff side, believe it or not,” the individual explained.
Moreover, Trump has remained an inconsistent communicator on tariffs, often blending his current push—which the administration describes as related to combating fentanyl deaths—with a broader frustration that he believes other nations are economically taking advantage of the U.S. On Tuesday night, he reiterated that not implementing tariffs equates to the U.S. effectively providing “subsidies” to Canada and Mexico.
“And the United States will not be doing that any longer. We're not going to do it any longer,” he asserted.
At this moment, the president appears unconcerned about alienating some of his key supporters, including the farmers in middle America who have expressed outrage over the tariff decisions. It remains uncertain whether farmers will receive exemptions from these newest duties, especially concerning potash, a vital fertilizer component primarily sourced from Canada—let alone any future tariffs. The agricultural sector is also among the first to face retaliation from other countries in response to increased U.S. tariffs.
“President Trump is president because of rural America. And so I don’t know why you’d want to do anything to make things more difficult, and things are very, very difficult on farmers right now,” said Sen. John Boozman.
Amid the turmoil, the president’s allies in Congress are reacquainting themselves with a phrase they relied on during his first term: Expect the unexpected.
“The strategy — how should I put this — I think the strategy here is devised by him and him alone,” stated Sen. Josh Hawley, prior to the afternoon auto announcement. “Which is typically how it is.”
Doug Palmer contributed to this report.
Frederick R Cook contributed to this report for TROIB News
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