Aggressive trade policy—and sharp accompanying market reactions—were a hallmark of the first Trump presidency, as stiff tariffs were levied on Chinese and European imports amid fiery debate over the future and shape of global commerce. Double Take recently welcomed Jamieson Greer, former Chief of Staff to Trump’s US trade representative Robert Lighthizer, to discuss whether history might repeat itself in a potential second term for Trump.
Greer, currently a partner on the international trade team at global law firm King & Spalding, believes tariffs would be a key tool for Trump during a second term in a quest to reduce the nation’s “persistent and large trade deficits” with other nations, and to “re-shore” supply chains. Trump has already floated a 10% “universal baseline tariff” on all imports, and Greer expects follow through if he is elected.
I do not speak for anyone at all, but I think we can look at what the former President is saying publicly, and he is talking about having very high tariffs on China. I think 60% was one of the numbers that he floated. I think that this is important to pay attention to because I do not think it is said idly. If you look at the first Trump administration, when President Trump was still candidate Trump, he gave a speech in Pennsylvania where he outlined about six different trade tools he expected to use during his administration. He got pretty specific about using section 301, section 232, which are national-security tariffs, and a variety of other tools. He used all those tools during his administration. Almost all of them held up to judicial scrutiny. When he says things now like we are going to have a 60% tariff on China, or what we were just talking about, we are going to have a 10% universal tariff, I mean, I do not think these are said idly. I think he means it. I think we should expect to see exploration of those tools.
Jamieson Greer, partner, King & Spalding
According to Greer, a universal tariff concept might be viewed in a second Trump term as a means to even the playing field with nations—namely India—that benefitted from disruption in Chinese supply chains caused by past tariffs.
I think any person who wants to decrease trade with China is much happier having those supply chains go to India versus being in China. But also, if you are a real homer and you want those supply chains in the Western hemisphere or North America or the United States, having them in India is kind of like, well, it is not as bad as China, but it is still not where I want to be … I think what you might see in that situation is certainly close attention to, at a minimum, obtaining additional market access into India. Because we do have a trade deficit problem with them too, and India is notorious for decades of having a very closed market … India is largely closed, and not just with respect to goods but with respect to services and all kinds of things. So, my sense is if India is going to continue to be the big beneficiary of supply-chain shifts, then India could probably expect to have requests from a Trump administration to open their market.
Jamieson Greer
From Greer’s perspective, the pharmaceutical supply chain, which is heavily reliant on China and India for active pharmaceutical ingredients (APIs), likely would be in focus in a second Trump term.
We have seen the CHIPS Act with respect to semiconductors, and we have seen announcements for new fabs in the United States. My own view is that we probably need to do something similar if we want to have APIs here, and even finished goods, and then the medical devices and then other things that surround the production and packaging of pharmaceuticals. … It is one thing to say we are dependent on the Chinese, let us stop being dependent. I mean, yes 100% and so let us put a tariff on them to deter that relationship. That is great. Okay, but now where are we going to get the APIs, right? We have to have our own and let us create incentives to do that whether it is industrial policy or tax treatment or something.
Jamieson Greer
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Authors
Jack Encarnacao
Research analyst, investigative, Specialist Research team
Raphael J. Lewis
Head of specialist research
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