Trump Plays 3-D Chess While the Rest of the World is Playing Checkers
Prior to today’s passing of the Big Beautiful Bill, the crescendo of woke leftist wailing, whining and sputtering in rage was unusually muted and silent over the past couple weeks.
Why?
The answer is pretty simple; President Trump keeps knocking it out of the park. The victories in Congress, foreign affairs, trade and immigration continue to pile up, and his detractors, you know, the ones who wish misery for the American people as long as it hurts Trump, have been proven wrong time and again.
However, it’s not that Trump is wracking up victory after victory, it’s how he is doing it. With every win comes the realization Trump is playing 3-D chess in a world that is still playing checkers. His latest foreign policy win demonstrates the brilliance of his strategy.
Trump Crushes it on Tariffs
Fundamentally, it’s important to remember that human beings like certainty and routine. Really, we’re no different from dogs in that respect. This applies to groups of people, organizations, and countries. When something or someone presents uncertainty, it triggers fear, and we will work tirelessly to correct the ambiguity.
Donald Trump knows this, and he purposely creates uncertainty and weaponizes it against his competitors. Tariffs are a perfect example.
In February, Trump declared “Liberation Day” would take place on April 2, 2025, which referred to a broad package of import tariffs that affected virtually every country in the world.
Chaos ensued as economists, pundits, heads of state and Democrats all predicted economic doom for the U.S. and the world.
And yet, despite the hysteria, negotiations began, and over the course of the ensuing three months, the U.S. reached trade agreements with key trading partners, China, Vietnam and the U.K. In each instance, the terms of the agreement will remedy decades of imbalanced tariff rates and restrictive barriers to entry that punished U.S. companies and favored foreign imports.
Interestingly, in spite of a 145% tariff on imports during the height of the trade war with China, and the hysteria of countries that finally realized the gravy train was over, the Import Inflation Index didn’t rise at all over the following three months.
Zip, zero, nada…
Producing $400 Billion in Additional Revenue Without Cost
Very recently, one of Trump’s harshest tariff critics admitted Trump’s unpredictable trade tactics may be more about strategy than chaos.
Torsten Slok, chief economist at Apollo Global Management, published a blog post where he openly wondered “is Trump a genius?”
In the blog, Slok speculates that Trump may have felt the agreement with China was the only one that really mattered, and once the 30% tariff was established, he was comfortable leaving the 10% tariff on the rest of the world with a 12-month extension to follow.
Slok recognized that such an arrangement would result in around $400 billion in additional revenue to the U.S. Treasury, and by extending the 10% tariff for a year, significantly reduce uncertainty in the market, also allowing global companies to adjust to the new tariff reality.
Based on the tariffs Trump originally threatened to impose on the world, most trade partners would breathe a sigh of relief at only 10%. A 12-month pause would also give the administration time to negotiate with other trade partners, like the EU, whose current deal is extremely complicated and loaded with triggers that impose artificial barriers and higher tariffs on U.S. companies.
Trump Plays 3-D Chess While the World Plays Checkers
From what I hear, toy prices are going up because most of them come from China. Interestingly, I have no idea what a Barbie doll used to cost compared to current prices. I would imagine there aren’t many people who are aware of this either. However, ask a family what a gallon of gas costs or a carton of eggs, and I’ll bet someone in the household can answer the question instantly and accurately.
President Trump knows this. What matters to ordinary Americans are the prices of groceries, gas, insurance, rent and utilities. So, if the price of the stuff people rarely buy goes up because of tariffs, but the things they buy every day remain level or go down, what is their perception of tariff inflation?
That’s right. If tariff inflation doesn’t impact their budget, they don’t really care.
It’s reported that foreign companies are lowering margins to accommodate the tariffs, and in some cases, like Canada, are providing subsidies to certain industries. This was also part of Trump’s calculus. Tariffs or not, competition in the marketplace continues, and no one wants to lose market share. It’s very possible most foreign companies end up eating the tariffs, and prices of their goods and services won’t rise at all.
If Trump pulls this off, and tariffs bring in $400 billion to the Treasury, it will be a truly remarkable accomplishment. Ask yourself this: What are the chances Congress would ever cut $400 billion from the budget?
Yep. Zip, zero nada…
Trump might make us $400 billion a year richer without needing feckless Congress to cut anything.
Pure genius, and that’s checkmate.
