Trump Talks Tough on Trade, but His Team Is Treading Lightly
WASHINGTON — President Trump has called the Trans-Pacific Partnership deal a “rape” of the United States. He has scolded Germany for being “very bad” on trade because it runs a surplus. And in April he said that he was “psyched” to terminate the North American Free Trade Agreement with Canada and Mexico, only to reverse course.
Despite Mr. Trump’s incendiary talk, his top trade advisers are taking a more cautious approach to dealing with America’s trading partners, striking a more moderate tone than the president but still laying the groundwork for the changes he has promised.
That more moderate tone has come as a relief to those who feared the Trump administration would swiftly usher in a wave of protectionism, while disappointing some people who hoped that a sweeping rewrite of trade deals would come in the administration’s early days.
The administration is now in the position of trying to reap the benefits that the Pacific trade agreement could have yielded while operating in the framework of the bilateral trade agreements that Mr. Trump prefers. It remains unclear what kind of concessions Mr. Trump will be able to extract from Canada and Mexico in negotiations over Nafta outside the context of a broader agreement.
“In T.P.P., countries agreed to a whole bunch of rules for us because they were getting access to Japan, which they couldn’t get on their own,” said Michael Froman, the United States trade representative under President Barack Obama. “The question now is how Mexico and Canada sell this at home — making these unilateral concessions to us — in exchange for nothing.”
The talks will be Mr. Trump’s biggest test yet as a deal maker on the international stage, and they could determine how other countries approach the administration in future one-on-one negotiations.
Despite Mr. Trump’s contention that multilateral deals are bad for Americans, Mr. Ross said while speaking last week at the US-Asean Business Council, a group that advocates United States companies operating in Southeast Asia, that there were some “good aspects” to the T.P.P. In an interview with CNBC this week, he suggested that he was “open to resuming” discussions with European countries about the very similar Trans-Atlantic Trade and Investment Partnership deal that has been frozen since last year.
The Nafta talks are expected to start in August after a 90-day waiting period begun by the administration’s letter to Congress. The administration will offer more specific negotiating objectives in July. Mr. Ross said he hoped that issues surrounding subsidies for Mexican sugar and for Canadian dairy products and softwood lumber could be addressed before the talks begin in earnest.
The administration has said it hopes to reach a deal by January. Major changes to Nafta require congressional approval in the United States and in Mexico. And the resistance of some Republicans to Mr. Trump’s trade agenda could create a rare instance in which he needs the support of Democrats. However, even those Democrats who agree with the president may be reluctant to back such a deal ahead of next year’s midterm elections.
Thus far, progressive groups, which saw trade as an area of potential alignment with the Trump administration, have not been impressed with what they have heard. They are increasingly concerned that Mr. Trump may end up on a path to what they call “T.P.P. 2.0,” and that grand plans to make trade deals fairer will not pan out.
“I see that the administration may be backing itself into another T.P.P. debacle where they spend time negotiating an agreement that they cannot get through Congress or they negotiate that would have the opposite outcome of what Trump promised in terms of lowering the trade deficit and bringing back manufacturing jobs,” said Lori Wallach, director of Public Citizen’s Global Trade Watch. “In which case it could become an political albatross around his neck.”