Inside the Oval: 3 reasons Trump buckled on tariffs
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President Trump signs an executive order Wednesday as Treasury Secretary Scott Bessent (middle) and Commerce Secretary Howard Lutnick look on. Photo: Saul Loeb/AFP
President Trump's boosters hailed his decision to pause tariff increases for countries around the world as a strategic masterstroke.
- But few are buying the spin. Trump buckled under tremendous, mounting-by-the-minute pressure from CEOs ... friends ... GOP senators ... the markets ... and bond prices. Trump himself admits he blinked when "people were getting a little queasy" about the bond market.
Why it matters: Inside the White House, the episode highlighted the roles of Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick as they animated Trump's risky game with trade.
🔎 Inside the room: Both men were advising Trump in the Oval Office when he decided to post a message on Truth Social announcing the tariff pause for 90 days while the administration negotiated with as many as 75 countries.
- The move was based on three factors, according to three sources familiar with the meeting:
- Bessent and Lutnick told Trump their phones were burning up with countries calling to negotiate. One source described the message from the two as: "We've got all these great countries. They all want to come and talk. How do we do it?"
- The president and his advisers also agreed that China's decision to raise tariffs on the U.S. created an opportunity for Trump to pause the tariff hikes on other countries as a token of friendship. It would be an effort to "put a ring around China, and isolate them," an administration official said.
- After several days in which Trump steadfastly said the falling stock market didn't bother him, the market's continued slide, emerging problems in the bond market and the falling value of the dollar became impossible to ignore. Friendly world leaders, congressional allies, major donors and CEOs "were practically begging for a pause," another official said.
Flashback: In the back of everyone's mind in the White House was how the tanking stock market shot up briefly on Monday after a false report that Trump was considering a 90-day pause.
- "I can assure you that was on people's minds in the administration, and certainly on the president's," a third administration official said.
The sense of relief at Trump's announcement wasn't just visible in the stock market's jolt upward. It was palpable in the postures of Bessent and Lutnick, who quickly got in front of TV cameras and lavished praise on the president.
- "As Secretary Bessent stated, no one is better at creating maximum leverage than President Trump," a Treasury official said in a written statement, adding that China's officials "have now isolated themselves from the rest of the world and are suffering the consequences."
Reality check: The financial markets jumped Wednesday, but Trump's on-again/off-again tariff policy has estranged friend and foe alike, leading many to wonder why the administration couldn't have been more measured, clear and focused with its tariff plan.
- "The easier way to enter into trade negotiations with our major allies and tariff China would have been ... to enter into trade negotiations with our major allies and tariff China," conservative writer Rich Lowry wrote on X.
What's next: Led by Bessent and Lutnick, Trump's economic advisers now will engage in a country-by-country negotiation process that will take months. They say all decisions will be teed up for Trump, who'll make the final call on each deal.
- Trump's decision-making process isn't always predictable or data-based, which he acknowledged to reporters when asked about how he'll determine tariff exemptions.
- "Instinctively, more than anything else," Trump said. "You almost can't take a pencil to paper. It's really more of an instinct, I think, than anything else."