Trump Doubles Down on Tariff Threats in Speech to Global Leaders

Trump at Davos
Reuters
By Yuval Rosenberg and Michael Rainey

Happy Thursday! A federal judge today temporarily blocked President Trump's executive order to end the automatic granting of citizenship to children born in the United States, calling it "blatantly unconstitutional." The judge's order stops agencies from implementing the order, which otherwise would have taken effect on February 19, while the lawsuit brought by four states - Washington, Arizona, Illinois and Oregon - proceeds. The suit asserts that Trump's order violates the 14th Amendment and the federal Immigration and Nationality Act. A statement released by the office of Washington State Attorney General Nick Brown said that the court "agreed the states' lawsuit is likely to prevail on the merits of their cases."

Here's what else is happening.

Trump Doubles Down on Tariff Threats in Speech to Global Leaders

President Donald Trump warned corporate executives and political leaders at the World Economic Forum in Davos, Switzerland, on Thursday that he intends to follow through on his threats to raise tariffs on companies that produce goods outside of the U.S.

"My message to every business in the world is very simple: Come make your product in America, and we will give you among the lowest taxes of any nation on Earth," Trump told the assembled elite via video link. "But if you don't make your product in America, which is your prerogative, then, very simply, you will have to pay a tariff."

Later during the event, responding to comments from Bank of America CEO Brian Moynihan, Trump reiterated his proposal to cut the corporate tax rate for companies that produce goods domestically. Noting that the corporate rate was reduced to 21% during his first administration, Trump said he wants another rate reduction, but only for firms that meet his requirement. "So, we're going to bring it down to 15% if you make your product in the USA," he said. "So, that's going to create a tremendous buzz."

A variety of targets: Trump's tax and tariff comments were part of a volley of complaints and veiled threats aimed at targets around the world. Addressing the European Union, Trump complained about unfair treatment. "From the standpoint of America, the EU treats us very, very unfairly, very badly," he said. "They have a large tax that we know about and - a VAT tax - and it's a very substantial one. They don't take our ... farm products and they don't take our cars. Yet, they send cars to us by the millions."

Trump also complained about the EU's enforcement actions against American technology firms accused of anti-competitive practices, including Apple and Facebook. "These are American companies. Whether you like them or not, they're - they're American companies, and they shouldn't be doing that. And that's - as far as I'm concerned, it's a form of taxation," he said. "So, we have some very big complaints with the EU."

Beyond the EU, the president renewed his vaguely threatening complaints about the trade deficit with Canada. "We have a tremendous deficit with Canada. We're not going to have that anymore. We can't do it," he said. "I don't know if it's good for them. As you probably know, I say, 'You can always become a state, and if you're a state, we won't have a deficit. We won't have to tariff you, et cetera, et cetera.'"

Trump also complained about the U.S. trade deficit with China. "We've been having massive deficits with China," he said. "Biden allowed it to get out of hand ... $1.1 trillion deficits. It's ridiculous, and it's just an unfair relationship. And we have to make it fair."

In addition to trade, Trump addressed the U.S.'s most important military alliance. As part of his drive to "bring back strength and peace and stability abroad," Trump said he plans to ask NATO allies to ramp up defense spending to 5% of GDP, more than twice the current 2% requirement. Trump noted that some NATO nations had failed to meet even that lower level of spending during his first term in office, which was "unfair" to the United States. "But many, many things have been unfair for many years to the United States," he added.

Trump indicated that he is focused on interest rates, potentially setting up a clash with the Federal Reserve, which acts independently to determine interest rate policy. He called on Saudi Arabia to lower oil prices. "With oil prices going down, I'll demand that interest rates drop immediately," he said. "And, likewise, they should be dropping all over the world. Interest rates should follow us."

Fact-checkers working overtime: As fact-checkers at CNN reported, Trump's speech was marked by false claims, misstatements and exaggerations. His claim that the U.S. runs a "$200 billion or $250 billion" trade deficit with Canada is grossly exaggerated; the net deficit was about $40 billion in 2023. Trump also overstated the size of the deficit with China, which was about $252 billion in 2023, far less than the $1.1 trillion he cited. And Trump's claim that the EU doesn't buy U.S. farm goods was off the mark - the EU is the fourth largest importer of U.S. agricultural products, buying $12.3 billion worth in 2023 - as was the complaint that the EU doesn't buy U.S. cars and trucks. In 2022, the EU imported 271,476 vehicles from the U.S., many of which were produced by European firms that have opened U.S. factories. According to the Atlantic Council, three major German automakers have created roughly 120,000 jobs in manufacturing facilities located in the U.S.

Takeaways from Trump's Oval Office Interview

President Trump on Wednesday gave his first Oval Office interview since returning to the White House, sitting down with Fox News host Sean Hannity for an hourlong discussion about his political comeback, his lingering grievances as well as the GOP agenda for the next four years.

Trump defended his pardons for more than 1,500 January 6, 2021, rioters and made headlines by insinuating that he might want to investigate former President Joe Biden. "This guy went around giving everybody pardons," Trump said. "And you know, the funny thing, maybe the sad thing, is he didn't give himself a pardon. And if you look at it, it all had to do with him."

Asked if he wants Congress to investigate Biden, Trump said: "I think we'll let Congress decide."

No clear direction on reconciliation strategy: Trump again said he doesn't care whether Republicans do one reconciliation bill or two. "I don't care as long as we get to the final answer. I like the concept of the one bill - I guess I said one big, beautiful," Trump said, adding, "It could be something else. It could be a smaller bill and a big bill. But as long as we get to the right answer."

He added that the California wildfires have "changed everything because a lot of money is going to be necessary for Los Angeles, and a lot of people on the other side want that to happen."

Questioning the importance of FEMA: Trump criticized the Federal Emergency Management Agency, repeating previous complaints that the agency has been biased and overly bureaucratic in its disaster response. "All it does is complicate everything," Trump said. "FEMA has not done their job for the last four years."

He added: "FEMA is going to be a whole big discussion very shortly because I'd rather see the states take care of their own problems. ... And then the federal government can help them out with the money."

Threatening to withhold aid for California: Trump criticized California Gov. Gavin Newsom's response to the wildfires, repeating false claims that state officials refused to allow water from the northern part of the state flow to the south. "I don't think we should give California anything until they let water flow down," Trump said.

The president is scheduled to visit hurricane-hit North Carolina and then fire-ravaged Southern California on Friday (before attending a campaign-style event in Nevada).

"Withholding aid, or making it conditional, would be a significant change in standard practice for how the government responds to natural disasters," The Washington Post notes. "Recent hurricane funding for mostly GOP-led states passed Congress without conditions."

Quote of the Day

"The dismissal of this case cannot undo the 'rampage [that] left multiple people dead, injured more than 140 people, and inflicted millions of dollars in damage.' It cannot diminish the heroism of law enforcement officers who 'struggled, facing serious injury and even death, to control the mob that overwhelmed them.' It cannot whitewash the blood, feces, and terror that the mob left in its wake. And it cannot repair the jagged breach in America's sacred tradition of peacefully transitioning power.

"In hundreds of cases like this one over the past four years, judges in this district have administered justice without fear or favor. The historical record established by those proceedings must stand, unmoved by political winds, as a testament and as a warning."

− U.S. District Judge Tanya S. Chutkan, in an order Wednesday to dismiss the case against John Banuelo, who was pardoned by President Trump along with more than 1,500 others convicted of crimes for their actions in the January 6, 2021 riot at the Capitol. Chutkan wrote that "no pardon can change the tragic truth of what happened on January 6." She was one ofseveral judges who refused to whitewash the events of that day or accept a revisionist history of it, even as they had to grant dismissals.

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