Last year President Donald Trump requested a national security Section 232 trade-investigation, to conducted by the U.S. Department of Commerce and Secretary Wilbur Ross, specifically focusing on U.S. steel and aluminum manufacturing.

The discussion continued last week as President Trump met with a group of republican and democrat members of congress to talk about trade policy and focus attention on the lack of American steel and aluminum production.   [The responses from the republican participants was very enlightening and disappointing.]

On Friday Commerce Secretary completed the industrial review and provided President Trump with trade recommendations to consider given the nature of the national security compromise.   See Outline Here.

Recommendations of the Steel Report:  Secretary Ross has recommended to the President that he consider the following alternative remedies to address the problem of steel imports:

1. A global tariff of at least 24% on all steel imports from all countries, or
2. A tariff of at least 53% on all steel imports from 12 countries (Brazil, China, Costa Rica, Egypt, India, Malaysia, Republic of Korea, Russia, South Africa, Thailand, Turkey and Vietnam) with a quota by product on steel imports from all other countries equal to 100% of their 2017 exports to the United States, or
3. A quota on all steel products from all countries equal to 63% of each country’s 2017 exports to the United States.

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President Trump will pull the U.S. out of NAFTA and direct the U.S. Trade Representative to engage in bilateral trade deals with Canada and Mexico individually.   There is no other possible alternative and here’s why.

First, the essential problem with NAFTA was an evolution over time.  In its current form NAFTA became an exploited doorway into the coveted U.S. market.  Asian economic interests, large multinational corporations, invested in Mexico and Canada as a way to work around any direct trade deals with the U.S.
By shipping parts to Mexico and/or Canada; and by deploying satellite manufacturing and assembly facilities in Canada and/or Mexico; China, Asia and to a lesser extent EU corporations exploited a loophole.  Through a process of building, assembling or manufacturing their products in Mexico/Canada those foreign corporations can skirt U.S. trade tariffs and direct U.S. trade agreements.  The finished foreign products entered the U.S. under NAFTA rules.
Why deal with the U.S. when you can just deal with Mexico, and use NAFTA rules to ship your product directly into the U.S. market?
This exploitative approach, a backdoor to the U.S. market, was the primary reason for massive foreign investment in Canada and Mexico; it was also the primary reason why candidate Donald Trump, now President Donald Trump, wanted to shut down that loophole and renegotiate NAFTA.
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Oh dear, Prime Minister Rainbow Sparkle-Socks is issuing threats now.

“We aren’t going to take any old deal,” Trudeau said Friday at a town hall in Nanaimo, British Columbia. “Canada is willing to walk away from Nafta if the United States proposes a bad deal.
We won’t be pushed around.” (link)

The backdrop is important context here.  Prime Minister Twinkles has been watching Trump, Ross, Mnuchin and Lighthizer closely.  Two months ago Twinkles attempted to launch economic leverage by entering direct trade discussions with China; but there’s a problem – Twinkles actually believes Beijing is ‘playful panda’.  PM Rainbow-brite doesn’t grasp that Playful Panda is a mask.  [Wrong place for leverage.]
Trudeau is willing to open his door to Chairman Xi without realizing once inside Beijing will hold open the door for arriving goods, and shuttle out the Canadian manufacturers. Attachment to China is a one-way proposition; and China only indulged Canada from the context of using the Canadian NAFTA door, as a tariff workaround to gain entry to the U.S. market.
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Commerce Secretary Wilbur Ross appears on CNBC to discuss ongoing trade initiatives including NAFTA, China and the more broad Asia background.  Additionally, Wilburine discusses growth in GDP and anticipated economic enhancements from the tax cut legislation.

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Earlier today it was announced that ADP private payroll growth for January has exceeded 234,000 jobs gained.   “The job market juggernaut marches on,” Mark Zandi, chief economist at Moody’s Analytics, said in a statement. “Given the strong January job gain, 2018 is on track to be the eighth consecutive year in which the economy creates over 2 million jobs.  (read full story on payroll report)
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Commerce Secretary Wilbur Ross at the World Economic Forum in Davos (President Trump departs the U.S. tonight to attend). The attendance by Secretary Ross provides an opportunity to further enforce the position of the Trump administration regarding free, fair and reciprocal trade deals.
Believe me, the economic globalist attendees were/are entirely freaking out.  There’s a panel discussion video at the bottom which will highlight the tenuous position of the multinational corporations, banks and the economic interests of the globalists.  Prior to the panel Secretary Ross gave an interview to CNBC. WATCH:

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As mentioned Secretary Ross also outlined how the ‘America First’ economic policy and platform engages with the global community during a panel discussion at the World Economic Forum.  Generally the attendees have been historic champions of multinational corporations and multinational financial interests, ie. fans of “economic globalization”.
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President Trump and U.S. Trade Representative Robert Lighthizer held an open-press Oval Office event to announce trade action, tariffs, against China (solar) and S-Korea (washing machines) for product dumping. [Details Here]
The backdrop of this executive action happens on the first day of NAFTA round six talks beginning in Canada.  Ambassador Lighthizer will be traveling to Canada shortly.  It is increasingly likely that President Trump will exit NAFTA as part of the larger initiative to draw manufacturing jobs back into the U.S.   In this round, we are hearing from those close to the work that Mexico and Canada are panicked and ready to concede in an effort to keep access to the U.S. market they are dependent on.
President Trump and Ambassador Lighthizer are now in the process of leveraging the U.S. business tax policy changes to hammer bilateral trade deals.  This is where the teeth of Team wolverine become visible.  All future action builds on all preceding action.

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The economic shift in 2018 will be a very visible Ambassador Lighthizer. Commerce Secretary Wilbur Ross built the larger foundation for U.S. trade policy and USTR action in 2017. Now that a smooth policy foundation is established, Robert Lightizer shifts into gear and becomes the trade-deal closer in 2018.
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U.S. Ambassador to the United Nations Nikki Haley delivered strong remarks today during a press briefing surrounding U.S. policy toward Pakistan and Iran.

“The administration is withholding $255 million in assistance to Pakistan. There are clear reasons for this. Pakistan has played a double game for years. They work with us at time, and they also harbor the terrorists that attack our troops in Afghanistan. That game is not acceptable to this administration.”

WATCH:

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Think BIGLY – On a geopolitical level the U.S. relationship with Pakistan is shadowed by a strong  Pakistani economic relationship with China.  China is Pakistan’s biggest investor.  China has also recently been identified as covertly propping up North Korea with smuggled oil shipments: “Very Disappointing“.
The central U.S. Pakistani relationship has always been about our fight against the terrorist networks of the Taliban in Afghanistan.  Pakistan has played both sides of that coin.  In August of 2017 President Trump warned Pakistan our relationship with them would be different if they did not stop enabling the Taliban.
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Many readers might remember back in the summer 2017 (throughout July) when there were indications that President Trump, and allies, were positioning assets and drills for what appeared to be a strategic naval blockade. Well, today Reuters is reporting that South Korea has seized a second oil tanker, flagged under Panama, headed to North Korea.
The cost of smuggling oil into North Korea is getting very high. These oil tankers are very expensive and the cost of commerce in international ocean freight is underwritten by massive global insurance companies. Each of these interdictions’ makes the business end of smuggling much more unstable.  Additionally, each of these violations opens up the co-dependent enabler as a target for massive U.S. Treasury Sanctions previously established.

SEOUL (Reuters) – South Korean authorities have seized a Panama-flagged vessel suspected of transferring oil products to North Korea in violation of international sanctions, a customs official said on Sunday.
The seizure was the second to be revealed by South Korea within a few days, as the United Nations steps up efforts to squeeze essential oil supplies to the reclusive North following its nuclear or ballistic missile tests.

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Because President Donald Trump is entirely deliberate most of the time; and because POTUS Trump very rarely uses a passive aggressive voice; the tweet response from President Trump, regarding China violating oil sanctions, is perfect -and serious- but also funny as hell when you understand the big panda picture.

President Trump knows the panda mask hides the red dragon. Those who have watched the past year engagement between President Trump and Chairman Xi Jinping can clearly see how Trump strokes the panda fur but well understands that Xi holds a zero-sum outlook.
China will never take action that is not in their specific best interests. Period. It’s the way Chinese negotiate. They hold a zero-sum world-view; if China doesn’t win, the action simply is not taken.  Only action that benefits Chinese interests is taken. Period.
Heck, the eyes-wide-open specific understanding of the Chinese view is the entire reason for Trump executing a years-long economic leverage approach toward China’s acquiescence over U.S. demands on the DPRK nuclear ambitions.
President Trump has been positioning a better economic benefit for China as the necessary leverage.  Simultaneously and intensely strategically, POTUS Trump has been publicly creating “magnanimous panda”, with elevated praise beyond words spoken of any other engagement.  Strategic Trump even deploys his granddaughter Arabella as part of the strategy of elevating over-the-top praise upon Chairman Xi, and by extension to “incredible people of China”.
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The economic strategy of President Trump is so consequential and encompassing, even the domestic effects are felt globally.

♦Removing the U.S. from the multinational TPP trade deal initially planted the seeds of doubt amid multinational trade forecasters because the shift positioned the U.S. with unique leverage. They saw Trump using access to the worlds largest market as a negotiating strategy.
♦A few months later, President Trump walked away from the ridiculous regulatory restrictions within the Paris Climate Treaty.  Instantaneously this put even more strategic manufacturing and economic advance on the U.S. ledger, and simultaneously made American energy independence a foregone conclusion.
♦And now that congress has codified President Trump’s lower domestic business taxes, in conjunction with opening up ANWR for energy development (a strategic economic goal for 20+ years), the size of the U.S. economic and manufacturing advantage has just increased U.S. trade leverage to almost unimaginable levels.

Economic Nationalism – President Trump’s strategy has created: •Lower and long-term predictable energy costs, not attached to OPEC or multinational influence; •Lower and long-term raw material costs due to slashed regulatory environment; •lower and long-term business manufacturing tax rates; and now Trump begins negotiating trade deals.

Add these advantages together within the largest economic market in the world and the U.S. is now the place where manufacturers will want to do business.  Additionally, the process of utilizing Canada and/or Mexico as a workaround into the U.S. market, via NAFTA, is on the cusp of removal.
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