SPECIAL REPORT: G-7 MELTDOWN
Here we are again with a special edition of our weekly news update.
Though the big story this week is surely the Kim-Trump summit—and from the point of view of the beginning of a long process of peace-making, it is—we offer a special edition on the G-7 Summit, which will have more short- and medium-term reverberations, as our allies try to make sense of what happened.
We know that you are busy people, and you probably do have a lot of news to sift through, online, on social media, on news feeds. But we will bring you a weekly update of news we curate from major news sources that may be of interest to you. We may even be able to introduce you to some new news sources you will enjoy exploring.
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- A.The G-7 Summit was an unprecedented debacle. This is the verdict of much of the press here, and indeed around the world. It seems Trump is taking aim at the very Western alliance and world order that the US established after the Second World War. And the attacks on Canada’s Justin Trudeau upended centuries of one of the most peaceful relations between neighboring countries in the world.
Trump himself called Trudeau a treacherous liar: “Mr. Trudeau had sought to play down personal clashes with Mr. Trump as he wrapped up the summit, calling the meeting ’very successful’ and saying he was ’inspired by the discussion,’” reported The New York Times over the weekend.
“But he also pledged to retaliate against the United States tariffs on steel and aluminum products in defense of Canadian workers. Mr. Trump, who apparently saw Mr. Trudeau’s news conference on television aboard Air Force One, was clearly enraged.
“’PM Justin Trudeau of Canada acted so meek and mild during our @g7 meetings,’ Mr. Trump said in a second tweet, ‘only to give a news conference after I left saying that, “US Tariffs were kind of insulting” and he “will not be pushed around.” Very dishonest & weak. Our Tariffs are in response to his of 270% on dairy!’” https://www.nytimes.com/2018/06/09/world/americas/donald-trump-g7-nafta.html
Trump’s advisors were even more vitriolic: “Larry Kudlow, the president’s economic adviser, said that Mr. Trudeau’s comments were ‘a betrayal’ and that he had ‘stabbed us in the back.’ Mr. Trump ‘is not going to let a Canadian prime minister push him around,’ Mr. Kudlow said on CNN’s ‘State of the Union’ program….[O4]
“Peter Navarro, the president’s trade adviser, was even harsher. ‘There’s a special place in hell for any foreign leader that engages in bad-faith diplomacy with President Donald J. Trump and then tries to stab him in the back on the way out the door,’ Mr. Navarro said on ‘Fox News Sunday.’” [emphasis added]
Extraordinary words from a White House advisor to a Canadian prime minister.
Reaction from around the world was swift and condemning.
The Paris news weekly, l’express, on Sunday used a word to describe the G-7 meeting that was common in French newspapers (as a web search will discover), “Trump scuttles [saborde] summit at last moment.” https://www.lexpress.fr/actualite/monde/g7-trump-saborde-le-sommet-au-dernier-moment_2015845.html
The Toronto Star said on Tuesday that “The Trump fury was especially bizarre because it did not seem to be prompted by anything Trudeau had actually done. Kudlow and Navarro claimed the problem was Trudeau’s post-G7 press conference — in which the prime minister criticized Trump’ssteel and aluminum tariffs in the same restrained manner he had been employing all week.
Trudeau had attacked as ‘absurd’ the notion that tariffs on aluminum and steel were somehow a threat to ‘national security’”—the justification the Trump administration used to get around WTO rules. In return Trump lashed out. [emphasis added]
“There is no obvious precedent for White House aides publicly slamming an allied prime minister in such personal terms. ‘I think people hear this kind of stuff on CNN and they think, “We’ve gone off the rails. This is a whole new realm of crazy because none of this makes any rationalsense,”‘ said [O5] Christopher Sands, director of the Center for Canadian Studies at Johns Hopkins University. The attack on Trudeau comes across as so unreasonable that Trump will have to ‘tone it down’ and attempt a ‘public rapprochement,’ but the relationship can be substantively damaged in the interim, Sands said.” https://www.thestar.com/news/world/2018/06/10/special-place-in-hell-canada-us-relations-reach-new-low-as-trump-aides-heap-insults-on-trudeau-to-impress-kim-jong-un.html
On the G-7 aftermath, The Guardian summarized, “Donald Trump has left the G7 network of global cooperation in disarray after he pulled the US out of a previously agreed summit communique, blaming the Canadian prime minister Justin Trudeau whom he derided as ‘dishonest and weak.’… Like last year, the communique made it clear that the US had a different view on climate change and how to fight it from the other six leaders, increasingly being referred to informally as the G6. Governments tried to shore up the damage late on Saturday with statements backing the form of words they thought had been agreed.” https://www.theguardian.com/world/2018/jun/10/g7-in-disarray-after-trump-rejects-communique-and-attacks-weak-trudeau
“Isolated, Trump managed to impose his agenda during an explosive G7,” is how Paris’s Le Mondereported the events on Sunday [in French; our translation] https://www.lemonde.fr/international/article/2018/06/10/isole-trump-est-parvenu-a-imposer-son-agenda-au-cours-d-un-g7-tendu_5312382_3210.html
Le Monde also said, under the heading, “Anger and little words,” “Sunday morning, the Elysee responded by stating that ‘France and Europe maintain their support for the final communiqué of the G7.’ ‘As, we hope, will all signatory members,’ added the French president.
“’We spent two days having a text and commitments. We stick to it, and anyone who leaves them by turning their backs, show themselves to be inconsistent and incoherent,’ the president said, noting that ‘international cooperation can not depend on anger or little words [or: “petty remarks”]. Let us be serious and dignified before our people. We are committed and we will stay firm.’” [emphasis added; in French; our translation] https://www.lemonde.fr/international/article/2018/06/10/vladimir-poutine-ironise-sur-le-babillage-inventif-des-pays-du-g7_5312453_3210.html
Here is how The Toronto Star reported on the dispute, after Trump again threatened Canada on Tuesday after the Korean summit: “[I]t is not clear why Trump has reacted to Trudeau’s post-G7 news conference with such anger. There, Trudeau expressed the same polite criticism of the steel and aluminum tariffs, and same promise to stand up for Canadians, he had been expressing for a full week. He and his ministers have described Trump’s tariffs as an insult given that they are officially being imposed on ‘national security’ grounds.
“’It would be with regret but it would be with absolute certainty and firmness that we move forward with retaliatory measures on July 1st, applying equivalent tariffs to the ones that the Americans have unjustly applied to us,’ Trudeau said then. ‘I have made it very clear to the president that it is not something we relish doing, but it is something that we absolutely will do, because Canadians: we’re polite, we’re reasonable, but we also will not be pushed around.’”
The Star further reported that, “Escalating his attack on Prime Minister Justin Trudeau, U.S. President Donald Trump is now pledging to punish ‘the people of Canada’ economically because of the post-G7 news conference in which Trudeau criticized Trump’s tariffs. [emphasis added]
“‘That’s going to cost a lot of money for the people of Canada. He learned. You can’t do that. You can’t do that,’ Trump said Tuesday in Singapore after meeting with North Korean dictator Kim Jong Un…. This is the first time Trump has threatened to take out his frustration with Trudeau on the Canadian people.” [emphasis added] https://www.thestar.com/news/world/2018/06/12/we-just-shook-hands-trump-confused-by-trudeaus-pushed-around-comment-after-g7-summit.html
The feelings of many Canadians were summarized on Tuesday by journalist and Carlton University (Ottowa) professor Andrew Cohen in Montreál’s Gazette, saying, “And after the world’s greatest charm offensive since the Khmer Rouge flirted with democracy, this was our reward: a twitter tantrum from the stateroom of Air Force One as it banked over the St. Lawrence River. To Trump, ‘Justin’ is now dishonest, weak, crafty and treacherous. And Canada – the Mister Rogers of nations – is a ‘backstabber’ and ‘double-crosser,’ consigned to the penthouse suite in Hell.
“Backstabber: This was how Nazis, conservatives and royalists described the republicans, Bolsheviks and Jews whom they blamed for Germany’s defeat in the First World War. Hell: This is where sinners suffer forever, no place for boy scouts and life insurers. [emphasis added]
“All this heavy artillery trained on little ole Canada?”
“One thing we know: Negotiating rationally with a studied ignoramus is impossible. More than erratic or mercurial, he is simply faithless. He believes in nothing and no one in love, friendship, business or politics.
“Trump sees the world only his way. He traffics in falsehood, humiliation and intimidation. Against all that, we never had a chance.” http://montrealgazette.com/opinion/columnists/cohen-against-trump-canada-never-had-a-chance
- What is behind all this ire?Of course the attack on Canada’s dairy tariffs is a sop thrown to America’s dairy farmers, pumping up nationalist resentments. The dairy tariffs may indeed be harmful to American dairy, and we will cite some facts below. But overall, the facts do not support the idea that Americans are being overly victimized by Canadian and European tariffs. Here is Paul Krugman on Tuesday: “It’s important to understand that the fight Trump is picking with our allies isn’t about any real conflict of interest — because they are not, in fact, doing the things he accuses them of doing. No, Canada and Europe aren’t imposing ‘massive tariffs’ on U.S. goods: A vast majority of U.S. exports enter Canada tariff-free, and the average European tariff is only 3 percent. These are simple facts, not disputable issues.”https://www.nytimes.com/2018/06/11/opinion/trump-quisling-enablers.html
We can begin with some facts to help readers counter the bizarre claims made by Trump and his people.
Economist Paul Krugman, writing in The New York Times on June 9, says, “[T]here has never been a disaster like the G7 meeting that just took place. It could herald the beginning of a trade war, maybe even the collapse of the Western alliance. At the very least it will damage America’s reputation as a reliable ally for decades to come; even if Trump eventually departs the scene in disgrace, the fact that someone like him could come to power in the first place will always be in the back of everyone’s mind…. [emphasis added]
“Then Trump demanded that the other G7 members remove their ‘ridiculous and unacceptable’ tariffs on U.S. goods – which would be hard for them to do, because their actual tariff rates are very low. The European Union, for example, levies an average tariff of only three percent on US goods. Who says so? The U.S. government’s own guide to exporters. True, there are some particular sectors where each country imposes special barriers to trade. Yes, Canada imposes high tariffs on certain dairy products. But it’s hard to make the case that these special cases are any worse than, say, the 25 percent tariff the U.S. still imposes on light trucks. The overall picture is that all of the G7 members have very open markets.”https://www.nytimes.com/2018/06/09/opinion/debacle-in-quebec.html
The Canadian dairy tariff is the one that set off Trump’s furious insults and threatening tweets. What is the whole story? It is absolutely true that American dairy farmers are hurting badly, from low prices caused by oversupply, some of which, certainly, is caused by using production-enhancing drugs like hormones on cows, not permitted in Canada. There is also much decreased demand for milk, coupled with improved genetics, all causing farmers in the US to dump milk or sell off cows. But the dairy industry is also hurting from the rising sales of milk substitutes, according to The Wall Street Journal, which notes that “[d]emand sagged just as the added capacity came on line, farmers and retailers said. One big reason: competition from new alternatives to conventional dairy.”
Could Canada help by soaking up some of that excess? Not much. Canada has import quotas, but it also has price supports, which keep milk prices high there, but also keep farmers employed. There would be no stomach to import cheaper milk, and Trudeau would be in big political trouble if he did.
Here is how The Guardian explains this: “Trump has attacked Canada’s protected dairy industry before, calling it a ’disgrace’ and blaming it for widespread hardship among US farmers. Although the entire trade in dairy products between the two countries is worth less than US$600m, ideological division has sharpened the ongoing dispute. His negotiators have demanded the dismantlement of Canada’s openly dirigiste [price controlled] system of supply management in agriculture – a complicated nexus of production quotas and import tariffs designed to ensure Canadian dairy, egg and poultry farmers receive fair prices for their products.
“Canadian farmers point out that despite the tariffs that protect them, imports make up 10% of the country’s dairy consumption. By contrast, the US restricts dairy imports to 3% of domestic consumption. ‘That just screams hypocrisy to me,’ Muirhead said. ’I don’t understand how they can get away with these positions.’ As a recent visitor to Wisconsin, ‘America’s Dairyland,’ where low prices are forcing the closure of hundreds of dairy farms a year, Muirhead said he encountered no resentment against Canada among local farmers. ‘The president of the Wisconsin Farmers Union told me that what they really wanted was a supply-managed system like ours,’ he said. ‘Dairy deregulation has spread hardship wherever it has been implemented, Muirhead added.’” Naturally, a Republican free-market administration would never control prices or production. Read this full explanation of the Canada dairy issue here:https://www.theguardian.com/world/commentisfree/2018/jun/09/milk-canada-us-trade-war.
But Trump also threatened more pain to Canadians, from increasing tariffs on Canadian auto imports. This is an odd strategy: he seems to imagine the US being flooded by Canadian imports; but in fact US auto makers export their autos made in Canada to the US, and such a tariff would hurt both Canada and the US industries. This is the price of a trade war: Canada would be hurt, but so would the US.
Read the facts from Bloomberg News on June 12: “Motor vehicles and parts were Canada’s biggest export after energy products, representing about 16 percent of the C$7.4 billion ($5.7 billion) in shipments over the first four months of this year. The Canadian auto industry directly employs about 130,000 people and contributes more than C$20 billion annually to gross domestic product….”
However, “Five automakers — GM, Ford, FCA, Toyota Motor Corp. and Honda Motor Co. — produced about 2.2 million vehicles in Canada last year. Approximately 85 percent of those vehicles are exported, with the vast majority going to the U.S. The most popular models shipped to the U.S. include the Toyota RAV4 and the Honda Civic, both assembled in Ontario plants…. Most analysts agree that the tariffs would also be bad for the U.S. American consumers [who] would have to pay $5,000 to $7,000 more for their vehicles on average, potentially reducing U.S. auto sales by 4 million to 5 million units a year, said [Dennis] DesRosiers [auto analyst in Ontario], who called it ’a nightmare scenario.’ [emphasis added]
“’It would potentially bring down the entire economy and push it into a recession,’ he said.”[emphasis added] https://www.bloomberg.com/news/articles/2018-06-12/trump-auto-tariffs-would-slam-canada-as-trade-rhetoric-heats-up
- But one of the most frightening developments of the summit was, in fact,Trump’s embrace of Russia, calling for its readmissionto the G-7 (it had been the G-8 before Russia was expelled for its annexation of Crimea). As Paul Krugman put it in The Times on Saturday, “[Trump] didn’t put America first; Russia first would be a better description. And he didn’t demand drastic policy changes from our allies; he demanded that they stop doing bad things they aren’t doing. This wasn’t a tough stance on behalf of American interests, it was a declaration of ignorance and policy insanity. [emphasis added]
“Trump started with a call for readmitting Russia to the group, which makes no sense at all. The truth is that Russia, whose GDP is about the same size as Spain’s and quite a bit smaller than Brazil’s, was always a ringer in what was meant to be a group of major economies. It was brought in for strategic reasons, and kicked out when it invaded Ukraine. There is no possible justification for bringing it back, other than whatever hold Putin has on Trump personally.”https://www.nytimes.com/2018/06/09/opinion/debacle-in-quebec.html
As Russia expert Strobe Talbott explains in Politico, in an essay on June 9,
“Russia’s eviction four years ago was not a matter of political correctness. Rather, it was – and still is – an ideological and geopolitical imperative, consistent with the reason that Russia was elevated to the G8 21 years ago.
That was a different Russia in a different world and, sadly, one led by a different United States…. [H]ere we are, 21 years later, and Russia has gone really bad, and it really is our enemy. On the ideological front, Putin has reversed Gorbachev’s and Yeltsin’s reforms. Russia is a pseudo-democracy and de facto autocracy under one-man rule. Putin has more power than any Kremlin leader since Stalin. He is alone at the top of the ‘vertical of power.’ Moreover, the Big Lie and the Mail Fist are back, domestically and abroad. Putin’s 2008 grab of two regions in Georgia and his 2014 conquest in Ukraine were the first instances of Moscow committing aggression in Europe since the Red Army replaced the Wehrmacht at the end of World War II in the name of ‘liberation,’ creating the Warsaw Pact.” https://www.politico.com/magazine/story/2018/06/09/trump-g7-what-comes-next-218668
As the CBC reported, Senator John McCain sharply criticized this Trump suggestion, saying, “‘The President has inexplicably shown our adversaries the deference and esteem that should be reserved for our closest allies. Those nations that share our values and have sacrificed alongside us for decades are being treated with contempt. This is the antithesis of so-called “principled realism” and a sure path to diminishing America’s leadership in the world.’”http://www.cbc.ca/news/politics/trump-g7-russia-putin-1.4699286
Republican leaders have been shockingly silent on Trump’s embrace of Russia. As Eugene Robinson wrote in The Washington Post on Monday, “So this is now Republican foreign policy? Embracing Mother Russia and bashing Rogue Canada? There was the usual criticism from Arizona Republican Sens. John McCain, who is fighting brain cancer, and Jeff Flake, who is retiring at the end of his term next January. Sen. Susan Collins (R-Maine) mumbled something about the closeness between Canada and Maine. But nobody actually did anything to constrain Trump. So he lurches ahead, dragging a once-great political party toward its own special place in hell.”https://www.washingtonpost.com/opinions/the-pompous-gop-credo-was-a-sham-all-along/2018/06/11/0b700636-6db4-11e8-bd50-b80389a4e569_story.html
This criticism was echoed by Paul Krugman, who accuses Trump of being a “Quisling” (collaborator), either wittingly because he is being somehow blackmailed by Putin; or unwittingly because he is being duped into cooperating with him. “Why are Republican politicians unwilling to discharge their constitutional responsibilities? Relatively few of them, one suspects, actually want a trade war, let alone a breakup of the Western alliance. And many of them, one also suspects, are well aware that a de facto foreign agent sits in the Oval Office. But they are immobilized by a combination of venality and cowardice.
On one side, tax cuts for the rich have become the overriding priority for the modern G.O.P., and Trump is giving them that, so they’re willing to let everything else slide.
“On the other side, the party’s base really does love Trump, not for his policies, but for the performative cruelty he exhibits toward racial minorities and the way he sticks his thumb in the eyes of ‘elites.’ So any Republican politician who takes a stand on behalf of what we used to think were fundamental American values is at high risk of losing his or her next primary. And as far as we can tell, there is not a single elected Republican willing to take that risk, no matter what Trump does.” https://www.nytimes.com/2018/06/11/opinion/trump-quisling-enablers.html
Is the Western alliance itself endangered? It may prove resilient. But the dangers ahead are summarized in Monday’s editorial in The New York Times, which is well worth reading: “When Vladimir Putin ordered his hackers to surreptitiously help Donald Trump in the presidential race, he could hardly have anticipated that once in office, Mr. Trump would so outrageously, destructively and thoroughly alienate America’s closest neighbors and allies as he did at theGroup of 7 meeting in Canada. The lame explanation from Mr. Trump’s courtiers, that he needed to look tough for his meeting with Kim Jong-un, made matters worse by implying that he felt he needed to publicly kick friends aside to impress a murderous dictator…. [S]o long as Mr. Trump is in the White House, and maybe beyond that, something fundamental in the community of Western democracies will be missing. America, the leader of the free world and the architect of so much of the modern world order, had decided to go its own way.” https://www.nytimes.com/2018/06/11/opinion/america-isolated-g7-canada.html
And in Europe, commentator and former Greek finance minister Yanis Varoufakis, in a column in Monday’s Guardian, warns that “if the US can no longer stabilise global capitalism, [Trump feels] he might as well blow up existing multilateral conventions and build from scratch a new global order resembling a wheel, with America its hub and all other powers its spokes – an arrangement of bilateral deals that ensures the US will always be the largest partner in each, and thus be able to exact a pound of flesh through divide and rule tactics. [emphasis added]
“Can the EU create a ‘Europe First’ anti-Trump alliance, perhaps involving China? The answer has been given already, following Trump’s annulment of the Iran nuclear deal. Within minutes of Chancellor Angela Merkel’s statement that European companies would stay in Iran, every single German corporation announced it was pulling out, prioritising the fat tax cuts Trump was offering them within the United States.
“In conclusion, we have good reason to be appalled by Trump: he is winning against a European establishment that wallows in perfect ignorance of the [populist] forces undermining it and paving the ground for appalling developments. The onus falls on progressives in continental Europe, in the UK, and in the United States, to put on the agenda an Internationalist New Deal – and to win elections campaigning on it.” [emphasis added]
We will return later this week with other news items, including press analysis of the Trump-Kim summit.