The President has made striking new trade deals that protect US industries a top priority, but two of his key agreements haven’t been settled. Negotiations with China are ongoing and, about a year after Trump signed his replacement for the North American Free Trade Agreement, Congress still hasn’t voted to ratify the deal.
US manufacturing “is stuck in a mild recession with little prospect of a real near-term revival,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics, in a note Monday.
“I gave them a big break on tariffs, but now I’m taking that break off,” Trump said. “Because it’s very unfair to our manufacturers and very unfair to our farmers.”
His administration said it would consider putting additional tariffs on the European Union for subsidies it provides to aircraft manufacturer Airbus, which competes against American jet maker Boeing. It already hit $7.5 billion worth of European goods like French wine and Italian cheeses with tariffs in October. The administration also proposed tariffs Monday on $2.4 billion of French products, after releasing a report that said a new French tax on digital services represents a barrier to trade.
American farmers have been particularly hard hit by the trade war with China. Beijing slapped tariffs on products including soybeans, corn and wheat. To help mitigate the pain, the Trump administration has offered aid money, totaling $28 billion — about double the cost of the 2009 auto bailout.
Farm lobby groups are also pressuring Congress to finalize the US-Mexico-Canada Agreement. US Democrats have been negotiating for months behind closed doors with the Trump administration on changes to the deal, especially on labor enforcement provisions. House Speaker Nancy Pelosi has said she wants to hold a vote on the deal by the end of the year, though that time line could slip given Congress’s busy to-do list in December.
It’s unclear when a deal might be reached with China. Negotiations with Beijing have been ongoing for well over a year. In October, Trump suggested they were close to reaching a “phase one” agreement that could ease trade tensions, but would fall short of a comprehensive deal.
But presidential adviser Kellyanne Conway said Monday that it’s “up to China” whether an agreement is reached before the 2020 election.
“It happens when it happens,” she told reporters. “And it’s going to take a while because this is new for China, they weren’t expecting President Trump to get elected and they weren’t expecting President Trump to make good on the promises he had made and said for 20 years as a business leader.”
The new tariff threat on Brazil and Argentina could impact Trump’s ability to finalize a broad deal with China, argued Phil Levy, the chief economist at freight forwarder Flexport who served as a senior economist for trade under President George W. Bush.
“This sends a signal that it is very difficult to trust this President to do a trade deal. The deal only lasts until he has another concern,” Levy said.
Trump also repeatedly called on the Federal Reserve to take action to weaken the US dollar, a favorite target.
“Manufacturers are being held back by the strong Dollar, which is being propped up by the ridiculous policies of the Federal Reserve,” Trump tweeted Monday.
CNN’s Haley Byrd, Brian Fung and Sarah Westwood contributed to this report.