The Theatre of the Absurd in Trump’s Trade Fight

The US government’s trade lawyers are working overtime. But what if the job in question requires more imagination than expertise?

Over the past two weeks, investigations have been launched in 16 countries under Article 301 of the 1974 Commercial Code, alleging “excess capacity” in production. U.S. Trade Representative Jamieson Greer’s office also announced similar investigations into forced labor practices in 60 countries. Some of America’s largest trading partners, including the European Union, Japan, India and Mexico, will appear on both lists.

It can be safely assumed that these 76 interrogations will proceed a little more quickly than usual, and that answers will arrive at the breathtaking speed with which the questions were asked. An even safer assumption is that these answers will be the answers the Trump administration wants.

The White House is acting with commendable efficiency here, as it does when it attempts to destroy institutions. Section 301 investigations serve a real purpose; that is, to detect countries that deliberately attempt to violate trade norms, and it usually takes months. Their goal was to remove trade barriers, not to eliminate them. It is heresy to use them as temporary scaffolding for a policy that has already been declared unconstitutional.

The whole world sees what’s going on. Everyone knew that President Donald Trump’s response to the Supreme Court striking down his tariffs under the International Emergency Economic Powers Act would be to find another law that allowed him to do exactly what he was prohibited from doing. “No” has never been Trump’s favorite word, and if there’s one skill a certain real estate developer has perfected, it’s forum shopping.

The list of countries is somewhat of an indication that this entire process is a legal fiction. Imagine an army of esteemed USTR officials solemnly examining Bangladesh’s structural overcapacity in manufacturing with all the serious purpose the exercise requires. Imagine if they then began to catalog forced labor practices in Norway, one of the 60 countries studied, with the same care.

The rest of the world will have to take this seriously, even if it is difficult. It is not certain that the courts will come to the rescue again.

Yes, the margin in the IEEPA decision was 6-3, and Chief Justice Roberts was quite emphatic. But Section 301 is different. It outlines a process that must be followed, and this investigation, no matter how theatrical, ticks that procedural box. The world cannot assume that the judges will want to destroy them en masse again. The management is counting on this; Greer called these provisions “incredibly durable from a legal standpoint.”

Washington has clearly learned something from last year’s failures. Have their counterparts in the rest of the world learned from them?

First of all, is it safe to negotiate with Trump? As the European Union has learned, it will re-litigate its own agreements even if not forced to do so by the Supreme Court. What Section 301 investigations do is reopen—perhaps implicitly—every deal Trump has ever made with Korea, Japan, India, or Southeast Asia. Do they need to reconsider everything? Can they?

Some, like the Malaysian Trade Minister, think they will. The commerce minister said the Bilateral Agreement on Reciprocal Trade that Trump signed with Prime Minister Anwar Ibrahim to great fanfare at the ASEAN Summit last year was “null and void”: “It’s not pending. It’s not there anymore.” The agreement was as dead as Monty Python’s parrot. It’s not like that anymore. Why would any country consider itself bound by agreements signed under coercive conditions that the court has annulled?

Last year, countries struggled to achieve piecemeal agreements; some let panic get the best of them; few coordinated their actions or retaliation. Washington’s assertion in the investigations at least gives the rest of the world time to consider whether this is the best approach.

The worst part, of course, is that, like all of Trump’s trade-related actions, there is only one objective goal. There is enormous excess production capacity in just one country; Only one major exporting economy has a structural problem with forced labor. But somehow Trump is too weak to confront China armed with facts, but strong enough to confront the entire world with fiction.

Using a more defensible, detailed law means there are many more weaknesses than there were in the original “reciprocal” tariffs. Every application of Section 301 must be tested in the courts; Each target of the tariffs should talk to others about what they have learned; The House will have to hold the USTR accountable if the balance of power changes after the midterm elections.

Dragging the USA from dream to reality will not be an easy process. But it will have to be tried.