When Donald Trump swore his oath in January, he promised to impose stiff tariffs to end the giant trade deficit he blames for poisoning our economy and hollowing out the heartland. And in six months, the average rate has jumped from about 2 percent to 18 percent.
But please, someone explain why a country like Brazil should pay 50 percent, even though we have a trade surplus with them. That’s nearly double the rate paid by China, by far the biggest offender when it comes to trade deficits.
Something fishy is going on. Because when you look at the crazy quilt of different rates paid by each country, it becomes crystal clear that trade deficits are only part of this. Trump has other motives.
Brazil is the extreme case, but several countries are in the same bucket. The list includes the United Kingdom, Belgium, the Netherlands, Australia and the United Arab Emirates. All of them are buying more American goods than they sell here, and all facing higher tariffs anyway.
So, what is driving Trump? If the trade deficit is really poisoning our economy, and all these countries are helping to offset the damage, then why are we screwing them?
The Brazil case makes one part of the explanation abundantly clear: Tariffs are a source of unchecked power for Trump, a power he is exercising without a scrap of input from Congress, based on his fantastical claim that the trade deficits have created a “national emergency.”
The tariffs give Trump a hammer he can use any way he likes. In the case of Brazil, he’s using that power to help its former president, Jair Bolsonaro, Trump’s mini-me, who lost an election fair and square in 2022 and responded by unleashing a violent mob to overturn the results. (Sound familiar?) He’s awaiting trial now, under house arrest with an ankle bracelet, and Trump wants him freed.
“Leave Bolsonaro alone!” Trump posted on social media last month. “He is not guilty of anything.”
It’s not going to work, and we’ll get to that. But what’s not in dispute – even by Trump – is that his beef with Brazil is not about trade. He’s using the tariffs to bully Brazil on a matter that’s entirely unrelated.
So, that’s part of the explanation. Tariffs give Trump unchecked power, and that’s his happy place. A week ago, he threatened higher tariffs on Canada if they go through with plans to recognize a Palestinian state.
GREASING THE SKIDS
But there’s a second reason Trump loves tariffs – they offer a golden opportunity for corruption. That may seem cynical, but he has established a pipeline that allows political and business leaders across the world to make unlimited and secret payments that directly enrich him and his family. Investors can buy a Trump meme coin, or invest in crypto ventures launched by his business. Trump has gorged on these payments, netting him more than $1 billion as of June, according to an investigation by Forbes.
“I have never seen such open corruption,” says Steven Levitsky, a professor of government at Harvard University and an expert on authoritarian regimes who co-authored the book “How Democracies Die.”
So, are foreign leaders paying Trump to show mercy on tariffs? How about industry leaders? Why, for example, is Trump exempting orange juice from the tariffs on Brazil, but not coffee? Why is he hitting Britain with a 10 percent tariffs, France and Germany with 15 percent, and Switzerland with 39 percent? Economists can’t seem to make any sense of it.
No, there is no evidence Trump is cashing in on the tariffs, at least not yet. But he has set up the machinery to grease those skids, and that makes it fair to raise the question.
NOT A PRETTY HISTORY
Back to Brazil, and why this bullying is unlikely to work. For one, Brazil is a democracy now, with an independent judiciary that doesn’t take orders from Washington. And while the U.S. is an important trade partners for Brazil, we take in only 12 percent of its exports, while China and the European Union take in more than 40 percent combined. Already, China is licensing importers to take in more Brazilian coffee.
In fact, defying Trump is political gold in Latin America, where many voters resent the long history of American bullying in the region. They remember that we took more than half of Mexico’s territory after the Mexican-American War in 1848, a war that then-Congressman Abraham Lincoln scorched as an unprovoked land grab. They know we helped install and support dictatorships all over Latin America, including in Brazil, Chile, Guatemala, Cuba, Bolivia, Dominican Republic, Haiti, Panama, Venezuela, and Nicaragua.
Our efforts to promote democracy in the region came later, beginning under President Jimmy Carter. But the legacy of American bullying hasn’t been forgotten, and a recent poll from Pew Research Center shows that Trump is radioactive in Latin America. In Mexico, 91 percent say they have “no confidence” in him. In Brazil, where our support for a military coup in 1964 led to two decades of dictatorship, the number is 61 percent.
THE ART OF ALIENATION
By picking this fight, Trump’s bullying has revived the political prospects of Brazil’s leftist president, Luiz Inácio Lula da Silva, who defiance now makes him the favorite to win re-election in 2026.
“President Trump’s behavior strayed from all standards of negotiations and diplomacy,” he told the New York Times recently. “When you have a disagreement, a political disagreement, you pick up the phone, you schedule a meeting, you talk and try to solve the problem. What you don’t do is tax and give an ultimatum.”
This is a mess, and I can’t see what Americans will get from it, beyond higher prices for coffee. The best hope now is that legal challenges will succeed, that the courts will find Trump’s “emergency” to be the naked power grab it is. Until then, Trump’s tariff hammer is likely to keep pounding away, alienating our trading partners, driving up prices at home, and opening the door to new frontiers of corruption. What a dealmaker!
Moran is a national political columnist for Advance Local and the former editorial page editor/columnist for The Star-Ledger of Newark, N.J. He can be emailed at [email protected].
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