Commentary: Nightmare situation as Trump’s tariffs head for Asia | USAEMALL.com

COLLECTIVE RESISTANCE

Mr Trump’s tariff actions are unlikely to stop on Apr 2. He has already indicated plans to impose new tariffs on semiconductors and pharmaceutical imports, which will further upend global trade.

For now, the administration appears committed to this course. If inflation rises, stocks tumble or supply chains fracture – all likely – the pressure will mount. That may come in the form of market turmoil, public anger or coordinated global retaliation.

At present, however, the world finds itself trapped in the “prisoner’s dilemma”. While collective action would benefit all, each country has strong incentive to protect itself. That’s precisely what has happened – and exactly what Mr Trump counted on.

Mr Trump has long favoured bilateral deals, which he believes maximise US leverage. He disdains the existing multilateral system, despite it allowing the US to become the world’s dominant economy, and which would permit the US to remain such. His threats to the European Union and Canada should they join forces on counter-tariffs make clear why he will do what’s needed to keep countries divided.  

Businesses, investors and governments are “tarrified” – trapped between the fear of economic fallout and the cost of pushing back.

While some wish the April 2 tariffs will not be as severe as expected given teetering markets, and one never knows who Mr Trump will listen to before making his final decision, hope is not a strategy.

In this era, with the market guardrail failing to hold on its own so far, standing together will be the only way to bargain with an America First US. 

Steven R Okun and Thurgood Marshall Jr served in the Clinton administration as Deputy General Counsel at the Department of Transportation and White House Cabinet Secretary, respectively. Mr Okun serves as CEO of APAC Advisors in Singapore. Mr Marshall practices law in Washington, DC.