Why Trump May Settle for a Bad China Trade Deal

For Donald Trump, the politics of trade always seemed straightforward.

Ripping pretty much any other country with which the U.S. runs a trade deficit—and China, trade villain No. 1, in particular—was a way to win hearts and minds of voters throughout the industrial Midwest in 2016. When it turned out that those voters, in states such as Wisconsin, Michigan and Pennsylvania, would unexpectedly give him the presidency, Trump's instincts—his gut—were ratified. "I won," he once told his friend Tom Barrack, a prominent investor and Trump campaign fundraiser, "because of trade."

What Trump didn't understand that night, according to friends, associates and people who work for him today in his administration, was how complicated the issue of trade is. As a businessman and self-described deal-maker of unparalleled excellence, he felt the imposition of tariffs on major U.S. trading partners would give him precious "leverage" in last year.