…What if the Trump administration has in mind a staged approach that would avoid the need for congressional approval in the first stage? There are growing signs that the administration might be considering this approach as a way to address its most pressing political need—assuaging President Donald Trump’s agricultural base, which has been buffeted by retaliation for Trump’s metals and China tariffs and by lost opportunities due to his withdrawal from the Trans Pacific Partnership.
While it may prove tempting for the administration to harvest short-term political gains from a narrow trade deal with Japan centered on agriculture, I believe there could be significant costs to U.S. interests and the global trading system long term. That’s because a narrow, first-stage agreement is likely to rely on relief from the threat of unilateral U.S. tariffs as the principal driver of a deal, which could spur protectionist moves by trading partners and further destabilize a global trading system already tottering under the effects of Trump’s trade policies.
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