Are You a "Trump Alarmist"?
Under Trump's “America first” policy, fears of the United States taking a more protectionist stance are justified, Reva stated. “That said, there has been a lot of alarmism, which I believe has been overblown.”
The reality is, a single individual isn’t going to be able to entirely disrupt the global trade order as it’s existed for the past 7 decades, she noted. The recent scare that occurred when we saw a draft of the executive order to walk away from NAFTA without attempting to renegotiate is a prime example.
It isn’t surprising that cooler heads prevailed and an intervention in the White House highlighted how much repealing NAFTA would harm many members of President Trump’s base, Goujon stated.
There are also questions about the president’s ability to unilaterally submit notice that the U.S. is withdrawing from a trade agreement.
“He would very likely face both legislative and judicial constraints,” Goujon said.
Trade Partners Concerned, WTO Under Threat?
All of this uncertainty has left an impression on U.S. trading partners. Overall, the issue creating the most concern for trading partners is how the president is going to wield the national security card.
If the United States tried to change the definition of what constitutes a national security threat, it would lead to a slippery slope that might destabilize trade relations.
“Of course, it will invite challenges within the WTO, but you’re also raising questions of whether the United States is going to abide by all WTO rulings,” Goujon said.
If the United States plays the national security card, that sets a precedent for other countries to do the same, undermining the credibility of the WTO, Goujon noted.
“I don’t necessarily think we’re heading to that extreme end,” She said. “The U.S. needs the WTO to be working to be able to enforce many of the trade disputes that it’s waging currently.”
Korean Peninsula Gamesmanship
When it comes to recent tensions between the United States and North Korea over missile tests, Goujon sees more of the same. The reality is, the U.S. options are limited.
“The details don’t matter as much as the reality that North Korea’s already a nuclear state,” she said. “It’s a political question of whether the United States wants to recognize it as one.”
The U.S. doesn’t have any good options when dealing with North Korea, and its goals are different from regional players, who have already accepted North Korean status as a nuclear state.
The North Koreans will entertain talks and play along, but ultimately they won’t comply, Goujon stated. The Chinese, too, have a vested interest in not changing the status quo in Korea.
Here's a clip where Reva explains Stratfor's view on the situation (subscribe here for full interview and ongoing access):
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