Frustrated White House free traders mount campaign to weaken Trump tariffs

 In U.S.

Since President Donald Trump announced plans last week to hit steel and aluminum imports with new tariffs, his trade adviser Peter Navarro and Commerce Secretary Wilbur Ross have been all over television celebrating their victory and rebutting suggestions that the move would incite a damaging trade war.

But economic adviser Gary Cohn and other free-trade advocates inside the White House and the Treasury Department are mounting a last-ditch effort to blunt the impact of Trump’s head-turning decision, even as the president insisted Monday that he wasn’t going to be convinced out of it.

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Cohn and like-minded officials in the administration are hoping the parade of senior GOP lawmakers, donors, lobbyists and business groups loudly opposing the pending decision will convince Trump that his proposed tariffs will damage the U.S. economy. There was a growing sense among some administration officials that the best way to talk Trump out of the tariffs was to make sure he hears from people outside of the White House, since he’s ignoring advisers inside the building.

West Wing aides led by Cohn, who directs the National Economic Council, are planning a White House meeting for Thursday with executives from industries likely to be hurt by big tariffs on imported steel and aluminum, two officials familiar with the matter said. The meeting is tentative and the participants have not yet been set in stone, but industries that could be hit hard by the tariffs include automakers and beverage companies.

The meeting is meant to counter the session with steel and aluminum industry executives last week in which Trump stunned the world by announcing he would slap tariffs of 25 percent on imported steel and 10 percent on imported aluminum.

Cohn and other critics of the tariffs have acknowledged privately to associates that Trump is unlikely to completely reverse himself. Trump, aides close to him said, is resistant to publicly flip-flopping on high profile issues, believing it makes him look weak.

But they still hope that as lawyers and policy aides draw up the actual language for fresh tariffs, they can marshal the growing external opposition to craft a more measured policy that includes exemptions that will minimize the economic impacts and preserve relationships with key allies.

One person close to the effort to change Trump’s mind said over the weekend that he’s confident the final proposal will be more nuanced than the one the president announced last week.

“I’d bet my life that’s not where it winds up,” the person said of Thursday’s tariff announcement.

Most senior administration officials weren’t surprised that Trump wanted steep tariffs. He’s been regularly demanding them behind the scenes for months. Cohn and others opposed to the tariffs believed they had convinced the president to hold off while they focused on trade actions related to China’s intellectual property actions, though an administration official who backs tariffs said that sequence had not been set in stone. They hoped the separate, China-specific trade actions, which are slated to include investment restrictions and tariffs on dozens of products, would satisfy Trump’s desire for stiff sanctions.

Yet it had become increasingly clear in recent weeks that Trump was getting impatient. When Cohn, during an Oval Office meeting earlier this year, told Trump that the tariffs will cost more jobs than they would save and presented evidence that President George W. Bush’s 2002 steel tariffs failed to achieve their goals, the president rejected Cohn’s arguments. The president told people present at the meeting that he was deeply skeptical of economists, adding that anybody can find an economist to echo their worldview, according to two people familiar with the deliberations.

Now, instead of relying on economic analyses and academic debates about trade policy, Cohn and other tariff opponents are pointing to market reaction, widespread anger among GOP leaders in Congress and the donor class and the threats from Europe, Mexico and China to retaliate.

It’s a wave of opposition from Trump’s party rarely seen since the early days of Trump’s presidential campaign, when rank-and-file Republicans openly mocked Trump’s proposals.

House Speaker Paul Ryan, Ways & Means chair Kevin Brady (R-Texas) and other lawmakers have each publicly expressed opposition to imposing tariffs. GOP lawmakers on Capitol Hill have started telling business leaders that they will not rule out taking action in the future to stop Trump, according to one Republican congressional aide.

While Congress’ options are limited, the Senate Commerce Committee has congressional authority over these unusual types of trade enforcement tools – though it’s not clear if the full Senate would have enough votes to legislatively make such a change, according to another Republican congressional aide.

“We are extremely worried about the consequences of a trade war and are urging the White House to not advance with this plan,” said House Speaker Paul Ryan’s spokeswoman, AshLee Strong. “The new tax reform law has boosted the economy and we certainly don’t want to jeopardize those gains.”

Asked to respond to Ryan’s comments, White House press secretary Sarah Huckabee Sanders told reporters Monday, “We have a great relationship with Speaker Ryan, but that doesn’t mean we have to agree on everything.”

Meanwhile, Trump’s pending announcement has set off deep concerns that the move could imperil Republicans in the upcoming midterm elections, with some donors loudly opposing the measure.

“I am a strong supporter of Trump, but this policy gives me pause,” said GOP donor Dan Eberhart, the CEO of Canary, oilfield services company.

Others close to the White House said they were not surprised that Trump finally pulled the trigger on a policy promise he made months ago, adding that he has long been a critic of free trade.

“This is something that has been anticipated for months, and in fact, the president campaigned on this. It is clear that he has been concerned about a trade deficit for a long, long time,” said David Tamasi, the former Washington finance chair for Trump Victory Fund. “With this decision, there is an alignment with the political contingency that propelled him to victory in many states.”

At the moment, the president does not seem swayed by any of the counter-arguments against the tariffs. Navarro and Ross have the clear upper hand inside the West Wing, according to two people who have spoken to Trump.

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