Ever since US President Donald Trump decided to implement his controversial reciprocal tariffs policy, the White House has found itself trying to communicate two seemingly contradictory ideas.
Hardline protectionists, such as US trade adviser Peter Navarro, saw the imposition of Trump’s trade tariffs as a permanent measure designed to bring back American manufacturing. On the other side of the argument, believers in global trade saw them as a short-term negotiating tool designed to pressure foreign countries to strike better deals with the United States.
Trade Secretary Scott Bessent has found himself in the position of trying to square this seemingly irreconcilable circle. At the height of the global financial crisis caused by Trump’s tariff policy, Bessent flew to Florida in a desperate bid to persuade the US president to revise his tariff plans.
Bessent seems to have succeeded, at least for now—a testament to the influence he can bring to bear on the US president, who responded to his pleas by issuing a 90-day pause on tariffs to most countries, while raising rates on China.
Bessent still faces the monumental task of striking dozens of trade deals with different countries in 90 days, while containing the fallout from the all-encompassing 10% tariffs on foreign trade. At the same time, he must also manage a trade war with China that could tip the US into a recession. According to The Wall Street Journal, Bessent is now prioritising deals with the UK, Australia, South Korea, India and Japan. South Korea is preparing for a critical round of talks next week, while Japanese officials are also travelling to Washington.
Moderating influence
In the trade context, Bessent is viewed as a moderating influence on Trump’s most aggressive trade impulses. But on matters of debt, Bessent is more of a zealot. To reduce America’s eye-watering $36tn national debt, he has put together a team at the US Treasury to help him in his mission.
“We are spending hundreds of billions of dollars per year in excess of what’s explained by inflation and population growth,” Deputy Treasury Secretary Michael Faulkender explained in a recent interview in Politico. “So, the government’s gotten larger. They have gotten more involved in people’s lives, and there was already bloat to begin with, honestly.”
“The market and the economy have just become hooked, and we’ve become addicted to this government spending,” Bessent himself told CNBC last month.
Bessent, 62, from South Carolina, has spent his finance career working for macro investment billionaire George Soros and noted short-seller Jim Chanos, as well as running his own hedge fund.
