Trump at G7 "We’re Like the Piggy Bank that Everybody is Robbing"

Mish

Trump threatens to stop trading with nations at the G7 conference because the US is being robbed.

At the G7 Trump said he is all for free trade while threatening to end trade altogether. Here's a G7 Who's Who.

Who's Who?

  1. Donald Trump, US president
  2. John Bolton, US national security adviser
  3. Unidentified
  4. Shinzo Abe, Japan prime minister
  5. Yasutoshi Nishimura, Japanese deputy chief cabinet secretary
  6. Angela Merkel, German chancellor
  7. Emmanuel Macron, French president
  8. Theresa May, UK prime minister
  9. Larry Kudlow, director of the National Economic Council

Packed Room Image

Tweet by French President Emmanuel Macron

Robbed Piggy Bank

Reuters reports Trump Rails Against 'Unfair' Trade at G7 Leaders Summit.

“We’re like the piggy bank that everybody is robbing,” Trump said at a press conference shortly before leaving the gathering of the United States, Canada, Great Britain, France, Italy, Germany and Japan. “It’s going to stop now or we’ll stop trading with them (other nations).”

Trump Calls For End to Tariffs and Trade Barriers

The BBC reports Trump Calls For End to Tariffs and Trade Barriers

Briefing reporters before he left the town of La Malbaie, in Quebec province, Mr Trump denied that the G7 summit had been contentious.

"No tariffs, no barriers. That's the way it should be. And no subsidies. I even said, 'no tariffs'," the US president said, describing his meetings with fellow Group of Seven leaders as positive "on the need to have fair and reciprocal trade".

"The United States has been taken advantage of for decades and decades," he continued, describing America as a "piggy bank that everyone keeps robbing".

Angered by the high steel and aluminium tariffs, Canada, Mexico and the EU have all said they are all planning retaliatory measures.

President Trump warned against such moves, calling it a "mistake" and said if it gets as far as a trade war, then the US would "win that war a thousand times out of a thousand".

Sticking points also remain in the North American Free Trade Agreement (Nafta) renegotiations between Canada, the US and Mexico, despite it being a key topic during the bilateral meeting between Mr Trump and Canadian PM Justin Trudeau.

The American leader said a three-country deal would only be possible with substantial changes, and reiterated his interest instead in forming separate two-way trade accords with Mexico and Canada - an interest Canada has made clear it does not share.

With divisions over trade laid bare, it still unclear whether a communique agreed by each G7 member will be released when the summit concludes later on Saturday.

G7 Statement

A G7 statement is not out yet. It's easy to guess what it will say. "The meeting was productive blah blah blah. We all agree on the need to reduce trade barriers blah blah."

Left unsaid will be the implied "You first." No one will volunteer.

Piggy Bank Nonsense

Meanwhile, it is to the decided advantage of the US to get cheap steel, cheal aluminum, and chief stuff in general.

That statement holds true no matter what any other nation does. Only fools dislike free stuff. If China really is providing the the US with goods below cost, that is to the definite advantage of the US to the detriment of China.

Jobs at Risk

There are about 6.5 million workers at manufacturers that use a lot of steel, but only 140,000 steelworkers, says Moody’s.

To protect 140,000 steel manufacturing jobs, Trump is willing to put 6.5 million workers at risk.

How stupid is that?

It's so stupid US Steelworkers do not even support Trump's latest play with Mexico and Canada.

I posted five charts and a few Tweets on this theme in Three US Tire-Chord Makers Threaten to Close Doors Due to Trump Tariffs.

Other Related Articles

  1. How to Not Sell Cars: More Steel Tariffs Coming Up
  2. National Security or Insecurity? Trump Tariffs Will Cost 195K to 624K Jobs
  3. Foolishness of Trump's Steel Tariffs in One Image
  4. Pandora's Box: Another Look at Steel Tariffs
  5. NAFTA is Dead: Trump Seeks Separate Agreements With Mexico and Canada

By the way, this setup is eerily similar to events leading up to the start of WWI. For discussion, please see Europe's Nationalism and Trump's Trade Policies Look Like WWI Prelude.

Mike "Mish" Shedlock

Comments (18)
No. 1-18
Kinuachdrach
Kinuachdrach

What's up, Mish? Are you not happy that the US President calls for a world with no tariffs, no non-tariff barriers, no subsidies? That would be Nirvanah! Let's hope the President can shame the leaders of those other countries into cutting their barriers to trade.

2banana
2banana

Funny that the countries who have sweet trade deals and large trade surpluses with America are upset...

caradoc-again
caradoc-again

It looks photo-shopped.

Greggg
Greggg

I wonder if you have to sign the AIPAC Pledge before being allowed to attend G7?

themonosynaptic
themonosynaptic

Trump doesn't know what he is doing in the real world, but in the game of "say things the educated and intelligent find boorish" he is way out in front, and that is the win his supporters want.

Realist
Realist

Trump may get his wish. Perhaps the rest of the world will just start ignoring the US and trade mainly with each other. The US can be an isolated island to itself. As I always say, be careful what you wish for.

Tengen
Tengen
(deleted message)

Shhh, you're not supposed to bring that up. Trump shed a few crocodile tears while signing the omnibus bill, that should be enough for the likes of us commoners.

I still marvel at Trump's ability to keep focus continually overseas. It's like domestic policy (sans sports) doesn't even exist anymore.

Contrarian_Ed
Contrarian_Ed

If you listen to Trumps news conference when he left the G7, his strategy is quite clear.

He favors 100% free trade (no tariffs, no barriers, no subsidies) (Larry Kudlow also made this point), but doesn't like trade deficits. All very reasonable.

He clearly said what is strategy is - he will continually increase tariffs, even to the point of stopping all trade with some countries, until their tariffs, barriers and subsidies are reduced.

He made the point several times, which also seems obvious to me, that the stronger negotiating side in a trade war is the side with the biggest trade deficits.

He clearly told the Germans, albeit somewhat politely, that if the EU doesn't reduce tariffs on US goods, no German cars will be sold in the US. He similarly told the Canadians that Canadian car exports to the US would also be hit with tariffs if Canada doesn't decrease their tariffs (270% duty on US milk imports).

Trump understands that negotiating requires pressure. Simply asking the EU and Canada politely to reduce their tariffs doesn't work - they need to understand that there's a serious consequence to not reducing their tariffs.

In the end, once Trump gets his way, there will be freer trade in the world, lower trade deficits in the US, and the rising tide will lift many boats.

Escierto
Escierto

Again the 9D chess player. His cult followers all believe that being a bully succeeds. I am betting that it does not succeed.

ReadyKilowatt
ReadyKilowatt

I have a trade deficit with Costco. I import their enormous bags of frozen mixed vegetables into my house. They don't buy any of my services even though I'm sure they'd benefit from my expertise. How does this harm me?

Homegrown mixed vegetables might be better quality, maybe not. For sure they'd be much more expensive to me and I lack the equipment and skills to flash-freeze them for storage.

I really wish we could remove the politics from job creation. But it's way too late for that now.

RonJ
RonJ

A picture of a thousand words.

Everyone is standing , except for Trump. They are all in the superior position, looking down at Trump, but Trump is not moved.

Blacklisted
Blacklisted

"Only fools dislike free stuff". Only fools think anything is free. There is always a cost / consequence.

Tengen
Tengen

Yeah, seems it's the only role these days. Where are you going with the "handing out candy" comment?

Six000mileyear
Six000mileyear

I find it ironic the EU permits the French and Germans to make deals at the G7 meeting for the benefit of themselves. The EU should send a representative for ALL of its members.

TCW
TCW

There is a national security aspect to this. What happens if all of our steel plants are closed and we go to war with China one day? The higher cost is like paying for an insurance policy.

Pater_Tenebrarum
Pater_Tenebrarum

If that is really the goal he intends to achieve, and if he indeed achieves it, then there is nothing wrong with his approach. It would definitely be advantageous for everyone if all trade barriers were removed.


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