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Home / New Zealand

President Donald Trump’s muscular stance on trade and tariffs and the warning signs for NZ - Todd Muller

By Todd Muller
NZ Herald·
22 Jan, 2025 02:00 AM5 mins to read

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Donald Trump takes the oath of office during the 60th presidential inauguration in the rotunda of the US Capitol in Washington, DC. Photo / Getty Images

Donald Trump takes the oath of office during the 60th presidential inauguration in the rotunda of the US Capitol in Washington, DC. Photo / Getty Images

Opinion by Todd Muller
Todd Muller is a former National Party leader and a close follower of US politics.

THREE KEY FACTS

  • In a wide-ranging inauguration speech, Donald Trump promised to send troops to the Mexico border, take back the Panama Canal, “drill, baby, drill” for oil and put people on Mars.
  • He also declared the Gulf of Mexico would be renamed the Gulf of America.
  • Trump has identified Canada and Mexico as the first targets of his tariffs.

The last time the cold Washington wind bit so hard that inauguration ceremonies had to be taken inside was exactly 40 years ago.

When the then 73-year-old Ronald Reagan, off the back of a 525-13 electoral college victory in the 1984 election, spoke to a packed Capitol Rotunda, it was clear that he was giving voice to a seminal change in American politics that would ripple out far beyond its shores.

He spoke to his long-held belief that an open society, shorn of suffocating government restraints, can breathe with a vigour that benefits all its citizens and act as an inspiration throughout the world.

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To quote Reagan directly, “our nation is poised for greatness. We must do what we know is right and do it with all our might. Let history say of us, ‘These were golden years - when the American Revolution was reborn, when freedom gained new life, when America reached for her best.

“These will be years when Americans have restored their confidence and tradition of progress; when our values of faith, family, work, and neighbourhood were restated for a modern age; when our economy was finally freed from government’s grip ... when Americans courageously supported the struggle for liberty, self-government, and free enterprise throughout the world, and turned the tide of history away from totalitarian darkness and into the warm sunlight of human freedom.”

For Reagan, the exceptionalism that made the United States so unique required an acknowledgment that “our heritage is one of blood lines from every corner of the Earth, we are all Americans pledged to carry on this last, best hope of man on Earth”.

His vision of America was a country that is “hopeful, big-hearted, idealistic, daring, decent, and fair” that was called upon “to pass that dream on to a waiting and hopeful world”.

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Every President since has sought to echo his sentiment and success – including Donald Trump when he spoke to a similarly packed Capitol Rotunda thanks to the unforgiving Washington winds.

He initially drew on Reagan’s language when he spoke of an America being on the cusp of a “thrilling new era of national success” and that a “tide of change is sweeping the country, sunlight is pouring over the entire world, and America has the chance to seize this opportunity like never before”.

Ronald Reagan waving beside his wife, Nancy Reagan, after being sworn in as 40th president of the United States at the Capitol by Chief Justice Warren Burger in 1981. Photo / AP
Ronald Reagan waving beside his wife, Nancy Reagan, after being sworn in as 40th president of the United States at the Capitol by Chief Justice Warren Burger in 1981. Photo / AP

But as is often the way with Trump he quickly returned to his familiar lament that America is fundamentally broken - culturally, socially, economically and geopolitically – and only he can fix it.

He spoke of an education system that teaches “children to be ashamed of themselves”; he signalled the end “of trying to socially engineer race and gender into every aspect of public and private life”. He spoke of sending troops to the Mexican border and “returning millions and millions of criminal aliens back to the places from which they came”.

Rather than being an open free trade Republican, Trump signalled he would immediately “begin the overhaul of our trade system to protect American workers and families. Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens”.

Not for Trump is an America that is a “shining city of the hill, a city with free ports that hummed with commerce and creativity. And if there had to be city walls, the walls had doors and the doors were open to anyone with the will and the heart to get here” as Reagan memorably later put it.

More startling was his overt commitment to not only exploit more of America’s natural resources - ‘drill baby drill’ - but that it should " once again consider itself a growing nation - one that increases our wealth, expands our territory, builds our cities, raises our expectations, and carries our flag into new and beautiful horizons”.

When I first heard him raging at America’s decline and sheeting it back to the political left I thought he would be a short-term phenomenon, brilliantly blazing across the political sky but not transformational. I was wrong.

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Trump and his MAGA machine are not some passing trend. He will fundamentally alter all nations’ calculations with his overt America-first policies.

This is equally true here in New Zealand. We face the potential of free and open trade but geopolitical challenges with our number one trading partner (China) and new tariffs and rapidly changing geopolitical positioning from our second most valuable partner (USA).

On top of this our third most important trading partner and only ally (Australia) is predisposed to back the US in any confrontation between the growing China and American spheres of influence.

This is all highly unwelcome, but now alas, unavoidable, because Trump is back and his muscular, binary, zero-sum approach to trade and global affairs is likely to stay influencing American policy for years to come.

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