On Tariffs and Tik Tok

Trump has once again granted an illegal extension to Tik Tok. You can reasonably expect this saga to go on and on, because Trump believes that keeping Tik Tok on a string gives him leverage against the Chinese. In reality, it works the other way; Tik Tok is an issue of minimal importance, so identifying it as significant actually gives more leverage to Xi.

The situation with the reciprocal tariffs is somewhat similar. Trump intends to use them as leverage for, well, we don’t know exactly what. The trade negotiations are supposed to encompass the whole world and be finished in 90 days to give investors the certainty they crave. In the real world, that deadline will be extended again and again, partly because the job can’t be done that fast when you don’t know what you want, and partly because Trump will be reluctant to surrender his leverage over the entire world just because the markets are in turmoil.