Faced with Trump's tariff threats, U.S. business executives launched a behind-the-scenes lobbying effort to soften or change the incoming president's plans. But this effort faces a potentially insurmountable obstacle: Trump is not making any concessions.
This leaves executives baffled, unsure how to lobby Trump to exempt him from the high tariffs he promised on imports from China, Canada, Mexico, and other countries.
So far, they have faced setbacks in seeking advice from Trump's aides on how to influence the incoming president's next steps. Trump has largely acted on his own terms, leaving his soon-to-be advisors with little opportunity to shape his thoughts. Insiders say that even some of his closest allies received little advance notice about his recent late-night social media statements regarding tariffs.
Sources say Trump's team told business advisors that once the elected president takes office, he will not abandon his plan to freely use tariffs.
With less than a month until the inauguration, companies in the U.S. and around the world are weighing whether Trump will follow through on many of the warnings he issued during his campaign, which could trigger a multilateral trade war, economists warn, potentially raising consumer prices. Comprehensive tariffs would have a significant impact on businesses and could raise costs for American companies importing products from abroad.
At the end of last month, Trump stated in a post on Truth Social that if Canada and Mexico do not take further steps to stop the flow of immigrants and drugs across the border, he will impose a 25% tariff on goods imported from Canada and Mexico. He also suggested the possibility of an additional 10% tariff on goods from China, claiming that China has not done enough to stop fentanyl from entering the U.S. Days later, Trump warned that if the BRICS countries (Brazil, Russia, India, China, and South Africa) attempt to replace the dollar as the world's primary currency, he may impose a 100% tariff on those countries. This is yet another commitment based on his earlier promise during the presidential campaign to impose comprehensive tariffs of up to 20% on all U.S. imports.
These warnings prompted a flurry of diplomatic actions, including urgent conversations among world leaders. After speaking with Mexican President Claudia Sheinbaum last month, Trump announced victory, writing on social media that she had agreed to stop immigrants from entering the U.S. through Mexico, 'effectively closing our southern border.' But Sheinbaum seemed to question his description, writing on X, 'Mexico's position is not to close the border.'
Trump discussed ideas regarding tariffs with his advisors, including the Secretary of State nominee Senator Marco Rubio (Republican of Florida) and investor Scott Bessent, who was selected as Treasury Secretary last month. However, insiders say his team received little warning that Trump would publicly disclose his plans on social media.
One source indicated that Trump reminded Rubio before posting about BRICS on social media, but he knew almost nothing about Trump's public tariff threats regarding Mexico, Canada, and China.
'Now is the toughest part. Just as Trump publicly promised to impose tariffs on Mexico, Canada, and China, a Bessent ally wrote in a text to the Wall Street Journal. A lobbyist who worked in Trump's first term said he now warns clients to take Trump's comments about using tariffs seriously, as advisors have little ability to stop him from using these strategies.
A spokesperson for Bessent stated that the Treasury Secretary nominee and Trump 'communicate daily about matters affecting the U.S. economy and geopolitical affairs,' adding that 'Trump formulates strategies, and Bessent implements those strategies in the most effective manner.
A spokesperson for Rubio stated that the Florida senator supports 'Trump's vision of restoring America's standing on the world stage and striving for greater trade fairness for American families and businesses.'
Trump transition senior advisor Brian Hughes stated that the incoming president will 'implement economic and trade policies that make life more affordable and prosperous for our country.'
If confirmed, Rubio and Bessent will play a central role in formulating and defending Trump's tariffs, along with Howard Lutnick, the businessman chosen by Trump as Secretary of Commerce, and Jamieson Greer, selected as U.S. Trade Representative. Trump has indicated that Lutnick will help oversee his trade agenda alongside Peter Navarro, a long-time advisor and supporter of comprehensive tariffs. The team will have to contend with concerns from foreign allies and adversaries, as well as companies and lawmakers.
Some companies and Republicans are hopeful that Trump's promise of high tariffs will not translate into action, but rather serve as a negotiation strategy to force other countries to make concessions.
Trump's ally, Arkansas Republican Senator Tom Cotton, recently stated at the Wall Street Journal CEO Council summit in Washington that the incoming president may be open to negotiations with Canada and Mexico, which could ultimately lead him to delay tariffs, but warned that his hardline stance toward China may not waver.
These warnings did not stop companies from fighting for a voice in the process.
The day after Trump announced the appointment of Navarro as senior trade advisor, a Wall Street Journal reporter received an email from Insteel Industries CEO H.O. Woltz III, asking how he could contact Navarro to discuss Trump's tariff policy.
Woltz's company is the largest manufacturer of wire products in the U.S. (used for reinforcing concrete in construction projects). Woltz wrote that when Trump imposed tariffs on steel imports during his first term, the prices of raw materials used to manufacture the company's products rose to 'the highest levels in the world.'
He later added that he does not think tariffs are a bad idea, but he is concerned that tariffs could disrupt domestic supply chains. 'Taking action at some point in the supply chain, while ignoring the rest of the supply chain, can lead to unintended consequences,' he wrote.
Some senior officials are quietly hiring firms closely connected to the Trump administration to ensure their views are communicated to Congress and Mar-a-Lago.
According to a new disclosure report, LG Electronics USA recently hired the government relations firm Capitol Counsel to lobby on trade and supply chain issues. Semiconductor manufacturer Global Foundries' global foundry hired the lobbying firm Cozen O'Connor Public Strategies to focus on similar issues.
Shortly after Trump announced he was considering taking action against goods imported from Mexico, wine, beer, and other spirits producer Constellation Brands hired a consulting firm aligned with the Republican Party. According to insiders, the aim was to emphasize to Trump the importance of cross-border business to the company's U.S. employees.
Constellation Brands has breweries in Mexico and imports beers including Modelo and Corona into the U.S. The company did not directly comment in a statement but indicated it will continue to work with the U.S. government as it has during bipartisan administrations.
Article forwarded from: Jin Ten Data