The Threat of Tariffs, Intimidation Diplomacy, by an Intimidator
Diplomacy between nations, as I have known it in my lifetime, has always been the strategic practice of managing international relations through negotiation, persuasion, and economic or political leverage to advance national interests while maintaining global stability. The key word there is strategy, while the tactics are nuanced and usually carried out by career diplomats, below ambassadorial level.
The big guys step in for the press release, once negotiations are complete.
That’s a time-honored process, and has served America through countless confrontational situations, such as
1. The Marshall Plan (1948-1952) which helped stabilize Western Europe, prevent the spread of communism, and strengthen U.S. allies, laying the foundation for long-term economic and political cooperation.
2. The Opening to China (1972) in which President Nixon and Secretary of State Kissinger initiated diplomatic relations with China through a secret visit in 1971, ending decades of hostility, driving a wedge between China and the Soviet Union during the Cold War, and laying the groundwork for China's economic cooperation with the United States.
3. The End of the Cold War & German Reunification (1989-1991), where Presidents Reagan and Bush engineered the fall of the Berlin Wall and Germany’s reunification, negotiating with the Soviet Union to ensure a stable transition and secure NATO’s presence in Europe.
These examples highlight America's ability to use diplomacy to shape global affairs, promote peace, and advance national interests.
All of which predated The Art of the Deal
The failed businessman, who sits in the Oval Office behind the Resolute desk, makes demands first, then threatens tariffs if those demands are not met. It’s called ‘diplomacy by intimidation,’ and is a failed tactic, rather than a successful strategy. Intimidation is not a strategy, it’s bludgeon economics.
1. In February 2025, President Trump announced a 25% tariff on all imports from Mexico and Canada, aiming to force issues such as illegal immigration and drug trafficking. Both countries agreed short-term on enhanced border security measures, then imposed equal tariffs on America. Oops, guess that hurts us more than them.
2. Trump threatened a 60% tariff on Chinese exports to pressure China into addressing trade imbalances and intellectual property concerns. Thus, everything we import (and it’s a lot) will cost the American consumer 60% more. Hello inflation, another oops moment.
3. Trump proposed "reciprocal" tariffs to counteract what it perceives as unfair trade practices by the EU, including barriers against American agricultural products and other goods. The European Union laughed that off and turned its purchasing focus toward China. Oops.
These few examples demonstrate the orange man's use of tariff threats as leverage to influence international partners and achieve specific diplomatic outcomes.
Somehow or another, Trump continues to misunderstand who pays the bill for tariffs. It is not China, or Canada, or Mexico, or any other target of his tariffs.
THE AMERICAN CONSUMER PAYS.
Listen to this, orange man. Pay attention, for god’s sake, you’re supposed to be leader of the free world, not a failed businessman.
If a tariff is ‘imposed’ on China, China does not pay the cost. Your imposed tariff merely makes the product 60% more expensive to the American consumer, and that extra 60% the consumer pays, goes to the government.
That is the very definition of a hidden tax on American citizens, and a major source of inflation to boot.
In other times, that may have hurt the tariffed country or at least gotten their attention. But largely because America moved its industrial power to China, that country now has its own middle class, a group of buyers twice the size of the whole of America.
Not twice the American middle class, twice the entire U.S. population. Which, if you’re paying attention, means their internal market is now sufficient to meet their internal needs, no longer worrying about America.
Oops.
Tariff power? Maybe in Columbia, Brazil or Spain, but never again in China.
BYD, China’s largest electric car maker, manufactured 4.3 million automobiles globally in 2024. More importantly, despite its vehicles selling for less than $17,000 on average, BYD topped Mercedes-Benz and Volkswagen, ranking first in car sales revenue in China last year.
In contrast, the orange man’s 25% tariff on Canada and Mexico is expected to raise the average cost of our already overpriced cars in America by $6,000.
Joseph Stiglitz, a Nobel Prize winning economist, says in today’s Guardian-UK newspaper,
“Trump policies make US ‘scary place to invest’ and risk stagflation. I could certainly see a scenario where we get to stagflation – we get inflation, and a weak economy,” he said. “I cannot see a really robust economy, because I just see the global economy suffering so much from the uncertainty that Trump poses.”
Scott Bessent, the US Treasury secretary, has suggested the administration wants to bring down 10-year US Treasury yields, an important interest rate, which would have a knock-on effect across global markets. Lower Treasury yields would make it cheaper for Washington to borrow.
But Stiglitz suggested the only way the president’s policies would positively contribute to that goal was by running the US into the ground. “The inflation from the tariffs is going in the wrong way, and the only thing that is going in the right way for Bessent is his efforts to crater the economy,” he said.
“In supporting Trump’s economic policies, Bessent is helping to get the yield curve down by crashing the US economy – not a good policy, I would say.”
And all of that, the orange man accomplished in just a few days short of one month.
Forty-seven months to go, and counting…