While Trump Talks Tough On Tariffs, His Administration Is Scrambling To Keep Trade Deals Intact

Not long after President Donald Trump announced on social media he was imposing a 15 percent global tariff, U.S. Trade Representative Jamieson Greer was on the phone with his British counterpart.

The U.K.’s top negotiator, Peter Kyle, had a plea for Greer — and an offer.

Even though the U.S. Supreme Court had just blown a hole through Trump’s trade regime, Kyle indicated Britain was prepared to adhere to the trade deal it reached with Trump in May. But Kyle stressed that the U.S. also needed to “honor the U.K.-U.S. deal” that set duties at 10 percent, according to a Downing Street spokesperson.

Translation: If you want to keep the agreement in place, back off that higher tariff rate.

Days later, Trump’s new tariff went into effect, but at a 10 percent level rather than the higher rate he had declared was “effective immediately.”

The conversation between Greer and Kyle — and the reduced global tariff rate that followed — was just part of the damage control Trump administration officials launched after their Feb. 20 defeat at the Supreme Court, part of an effort to preserve trade pacts forged using tariffs that the court had invalidated.

For all Trump’s threats and public bluster, a number of key advisers and U.S. envoys are privately taking a more conciliatory approach in the hope of averting further setbacks to Trump’s trade agenda.

“The United States expects all of our trading partners to uphold existing agreements that restore reciprocity in our trade relationships, benefiting American workers and producers,” said a White House official, granted anonymity to discuss behind-the-scenes conversations.

The Commerce Department and Office of the U.S. Trade Representative did not respond to requests for comment.

In addition to the U.K., Greer and Commerce Secretary Howard Lutnick spoke with trade officials in the EU, India and Canada in the days after the Supreme Court ruling, which ruled the president did not have authority to levy his "reciprocal" tariffs and others under a national emergency law.

French trade minister Nicolas Forissier said in an interview that he also convened a virtual call with Greer and other G7 trade ministers on Monday. “My discourse, which was very well received by the ambassador, was extremely calm and constructive,” Forissier said.

That’s a far cry from Trump’s tone on Truth Social Monday, warning, "Any Country that wants to 'play games' with the ridiculous supreme court decision, especially those that have 'Ripped Off' the U.S.A. for years, and even decades, will be met with a much higher Tariff, and worse."

The president had wielded the 1977 International Emergency Economic Powers Act to make similar tariff threats last year — ultimately reaching tentative agreements with most of the United States’ top trading partners. In exchange for lower tariffs, the EU, Japan, South Korea, India and others pledged new market access and hundreds of billions in investment in the U.S. private sector.

The Supreme Court ruling and the White House’s subsequent announcement of a new, replacement set of global tariffs sparked uncertainty in those countries about the future of their deals. After Trump’s Saturday post announcing his new duty would go up to 15 percent, the European Parliament froze key legislation to implement its side of the deal. EU Trade Commissioner Maroš Šefčovič, however, urged members Tuesday to approve the deal, noting he had received assurances from his U.S. counterparts that they planned to honor the Turnberry accord.

Those assurances aren’t the only reason countries are opting to stick to the existing agreements — the White House has also made clear it can use other U.S. trade laws to raise duties on imports from countries if they renege.

Like the EU, India delayed planned trade meetings this week on the deal it inked with the Trump administration last month. But both sides still expect their deal to move forward, according to someone who has spoken with the Indian government, granted anonymity to share private conversations.

The South Korean legislature still plans to hold a vote to authorize its $350 billion investment account in early March, Korean media reported.

Japan, which has pledged $550 billion to invest in U.S. projects of President Donald Trump’s choosing, has indicated that it plans to “continue implementing the agreement we made with the United States last year," according to its embassy.

“The good news is that almost all countries and corporations want to keep the [trade] deal that they already made,” Trump said in his State of the Union Address Tuesday night. “Knowing that the legal power that I, as president, have to make a new deal could be far worse for them, and, therefore, they will continue to work along the same successful path that we had negotiated before the Supreme Court’s unfortunate involvement.”

As the president noted, the administration has plenty of other legal authorities it can and has used to impose burdensome tariffs on foreign countries. One of the most powerful is a statute allowing the president to set duties on certain industries on national security grounds. Trump has used that power to raise tariffs on products like automobiles, steel, aluminum, copper and lumber — and has threatened to impose more.

The 25 percent tariffs on autos, auto parts, steel and aluminum were major factors pushing the EU, Japan and South Korea to complete deals with Trump in which they pledged hundreds of billions of dollars in U.S. investment.

“The Koreans are very aware that even though he lost the IEEPA case, part of what they got out of it was on the sectorial tariffs on autos dropping from 25 percent to 15, which brought them in line with Japan and the EU and is absolutely essential to Korea to be competitive,” said Tami Overby, a partner at DGA Government Relations, which focuses on South Korea. “So I think the deal with Korea is pretty solid.”

Greer and Commerce Department officials have also said they plan to launch new national security and country-specific trade investigations in the wake of the Supreme Court ruling, which could result in new tariffs later this year. That could include an investigation into unfair trading practices when it comes to digital services — a mechanism that could be used against trading partners that have passed or are considering strict digital regulations, including South Korea, Brazil and the EU.

The administration has also conducted a national security investigation into pharmaceutical imports, but thus far held off on imposing new tariffs. Just the threat of high duties on the country’s pharmaceutical industry is part of what brought India to the table to hammer out a deal over the past year.

“The ability to compel implementation of these deals is weakened a little bit [by the Supreme Court ruling], but not significantly,” said Peter Harrell, a former Biden official. “I think that there is kind of enough other tariff threat, enough other non-tariff threat, and also, frankly, enough inducement in these deals that by and large, the governments that have agreed to the deals will continue to honor them.”

For Japan, one of the first major trading partners to strike a deal, the decision to stick to the trade agreement isn’t just about tariffs — though higher auto tariffs would be punishing for its economy. It’s also about national security. China has continued to ramp up pressure on the country, through both military and diplomatic channels, after Japanese Prime Minister Sanae Takaichi said she would activate the country’s self-defense force if China attacked Taiwan.

“It wasn’t just purely a trade deal,” said William Chou, the Japan Chair at the Hudson Institute, a right-leaning think tank, when asked what’s keeping Japan in its agreement. “It was a political deal.”

Not every country faces the same threat from national security tariffs. Bangladesh, which is a major textile exporter to the U.S., struck an agreement with the Trump administration earlier this month. But its legislative body is reconsidering whether to move forward with the deal, given that the recently struck-down tariffs were the primary motivation for reaching an agreement.

The Supreme Court’s ruling has also emboldened domestic critics of the deals in some countries. In Taiwan, the main opposition party has already threatened to stall approval of Taiwan’s agreement with the Trump administration, which set tariff rates on most Taiwanese goods at 15 percent, higher than the global 10 percent duty now in effect. And it seized on the decision as a reason to go back to the drawing board with the U.S.

The court decision “completely overturned” the agreement’s legal basis and requires the government to “report to the legislature immediately and consider reopening negotiations,” Fu Kun-chi, legislative caucus convener for the KMT Party, said Monday, per the South China Morning Post.

Still, most major trading partners are well aware that backing away from existing agreements risks drawing Trump’s wrath. And although the Supreme Court ruling took away his ability to slap tariffs on imports at a moment’s notice, his administration can still target goods from specific countries after a USTR investigation. That sort of “301 investigation” is how Trump justified tariffs on billions of dollars worth of Chinese goods during his first term.

“It’s now up to the Americans to clarify things, to calm things down,” said Forissier, the French trade minister. “I don’t think it’s in the United States’ interest to take a stance of high tariffs, toughening measures.”

Ben Lefebvre, Zi-Ann Lum and Phelim Kine contributed to this report.