Many of the announcements have not come through official White House channels; for example, Trump threatened a 50% tariff on the EU in April in a bid to get European negotiators to the table—by posting on his social media site, Truth Social.
“There’s a real reason for that, I think the other countries, as they’ve thought about it, have recognized that while they have to talk very bravely for their domestic political constituencies… They also recognize that at the end of the day, they can’t afford a tit-for-tat escalating trade war with us.”
And this was a fact Trump was relying on, continued Ross: “One of the earliest things he put in was that 10% tariff on everything from everywhere.
“Nobody is even complaining about that anymore. When you think about it, in the normal course, getting quietly to do a 10% tariff on everything from everywhere was a huge achievement, even if he didn’t get anything else. But because he followed it with these much more extreme things, it makes the 10% look like it’s not such a big bother.
“But it’s a huge number, and he’s been collecting it every day.”
And President Trump’s tactics, which have included everything from threatening a 25% hike on Apple’s iPhones specifically to raising sanctions to more than 150% on China at some points, reflect the path Ross expected.
Ross felt the better tactic was to threaten such action and keep an exit as a last resort, an opinion that Trump eventually came around to agreeing with.
Likewise, having been appointed in 2017 Ross oversaw the tariff action in the first Trump administration which included sanctions on Chinese goods as well as aluminum and steel more widely.
“He has started out on a much more adventurous path than last time,” Ross told Fortune this week. “Broader in scope and more extreme in terms of the numbers themselves.”
Trump has three objectives, he adds: shrinking trade deficits, producing revenue to offset his “One Big, Beautiful Bill” and achieving other diplomatic purposes such as the flow of fentanyl into the U.S. and global defense spending.
“He has a much more fulsome, much more complicated agenda than before,” Ross explains. “It’s also different in…that last time I was very careful to set the groundwork to do public hearings, stakeholder meetings, to do written reports, to set a whole record so that under the Administrative Procedures Act we would be relatively safe from people trying to knock it out in court.
“This time, they did a very different thing. They went in mostly just by his say so using the IFA, the Emergency Powers Act, and they ran into a snag at the Court for International Trade.”
This snag may alter the course of tariff reaction on the account of businesses, he added, because their investment timelines may shift based on when the tariffs are legally approved.
But Ross added: “Most people are operating under the assumption that sooner or later, he’ll get something like what he was looking for…and therefore, while it’s slowed down a bit, [I] don’t think it will derail [trade talks] because [foreign governments] also know there are other ways he could punish them rather than just the tariffs.
“So it’s a bump in the road, but I don’t think it’s a huge pothole that would wreck the car.”
