Foreign Policy

Trump Shakes Up G7, Demands Fair 'Reciprocal' Trade

Trump played the G7 summit leaders the way he has played Washington's establishment class.

Thomas Gallatin · Jun. 11, 2018

With all the mainstream media hoopla surrounding the G7 summit this past weekend in Quebec, Canada, one thing is clear: President Donald Trump, as always, dominated the narrative. And he proved once again that he relishes being the anti-establishment guy, this time sending the heads of Europe’s globalist leaders spinning. The G7 summit usually amounts to little more than a couple days of Western allies and Japan hobnobbing for photo ops while proposing various jointly agreed upon socioeconomic agendas and then jetting back home again. It’s more pageantry than policy. But this time Trump saw an opportunity to press his case that the U.S. has long been getting a raw deal from its closest allies when it comes to trade (not to mention NATO). He declared in advance, “Looking forward to straightening out unfair trade deals with the G7 countries.” But he offered the caveat, “If it doesn’t happen, we come out even better!”

Trump caught everyone off guard by throwing out an unexpected proposal — “unexpected” in light of his recent implementation of tariffs on steel and aluminum. Trump suggested, “No tariffs, no barriers — that’s the way it should be. And no subsides. I even said no tariffs.” He added, “Ultimately that’s what you want. You want tariff-free, no barriers, and you want no subsides because you have some countries subsidizing industries and that’s not fair. So, you go tariff free, you go barrier free, you go subsidy free.”

The G7 leaders were seemingly stunned, but it became increasingly obvious that this was not a direction they wished to go. Instead, Europe’s leaders saw the summit as an opportunity to hammer Trump’s trade policies. Trump was coming to their sandbox and they were there to scold him for failing to play by their elitist rules for their vision of globalism.

However, even after all the tension, it appeared that the G7 summit would produce a jointly agreed upon “communique” — essentially a commitment to fight for a “rules-based international trading system and [to] continue to fight protectionism.” Trump agreed to sign the communique as he quickly dashed off to the much more important summit in Singapore with North Korean dictator Kim Jong-un.

All seemed well for a few hours … until Canadian Prime Minister Justin Trudeau’s follow-up press conference. Trudeau referred to Trump’s tariffs as “insulting” and insisted that he would “move forward with retaliatory measures on July 1, applying equivalent tariffs to the ones that the Americans have unjustly applied to us.” Trump, on his way to Singapore, quickly announced that he was withdrawing his signature on the G7 communique: “Based on Justin’s false statements at his news conference, and the fact that Canada is charging massive Tariffs to our U.S. farmers, workers and companies, I have instructed our U.S. Reps not to endorse the Communique as we look at Tariffs on automobiles flooding the U.S. Market!” This was followed up by a series of messages in which Trump focused on his primary theme of America not getting a fair shake. Trump wrote, “Fair Trade is now to be called Fool Trade if it is not Reciprocal,” later adding, “We’re like the piggy bank that everybody’s robbing, and that ends.”

Europe’s leaders have clearly become increasingly frustrated with Trump’s seemingly unpredictable behavior. He, on the other hand, appears to have accomplished exactly what he intended — exposing the unfavorable trade imbalance between the U.S. and G7 nations.

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