The 41-page ‘blueprint’ that shines a light on Trump chaos

In July 1944, during World War II, hundreds of economic policymakers from dozens of countries gathered at a hotel in Bretton Woods, New Hampshire, to establish a new framework for the global financial system once the war ended. The resulting Bretton Woods agreement has shaped international trade ever since.

Roughly 80 years later, President Donald Trump’s chaotic trade policies have fuelled speculation among investors and economists that a modern-day equivalent may be on the horizon - a “Mar-a-Lago accord” to revise those postwar global trade rules, crafted at his resort in Palm Beach, Florida.

Trump’s trade war has rattled markets and economies around the world.Credit: Bloomberg

One of Trump’s top economic advisers has written a 41-page document that lays out the possibility of achieving just such an agreement, through a combination of tariffs and other policies. Now, foreign bankers, Wall Street traders and congressional aides alike are reading it in search of clues. Written by Stephen Miran, chair of the White House Council of Economic Advisers, “A User’s Guide to Restructuring the Global Trading System” has emerged as what many observers hope is a blueprint for trying to understand the administration’s erratic economic policy.

Miran’s paper argues that unilateral tariffs may be necessary to force US trading partners to make changes. He writes that the dollar’s strength for the past half-century has made US exports too expensive for the rest of the world to buy, and imports too cheap for US consumers to pass up, degrading US manufacturing and industrial output. Trump, Miran suggests, could try to force scores of countries to increase the value of their currencies – possibly through a US-launched trade war that puts unrelenting economic pressure on the rest of the world. (Miran describes the idea only as one of a handful of options, rather than a definitive set of recommendations.)

For now, there is no indication the White House is moving forward with a Mar-a-Lago accord. Trump has discussed his upcoming set of tariffs as aimed at getting other countries to lower their own import taxes, and Miran said in an interview that a global currency agreement is not what the administration is pursuing. Treasury Secretary Scott Bessent has said publicly that he thinks the US dollar should be strong, whereas the ideas Miran outlines would require the dollar to be weaker than other countries’ currencies.

“The president’s very clear on fair and reciprocal tariffs,” Miran told The Washington Post. “Anyone thinking what I wrote in November is the policy agenda we’re secretly implementing right now is just looking for something to write about.”

And yet the paper has attracted a great deal of interest from economists and other observers at home and abroad who are trying to understand the pain inflicted by the tariffs as part of a broader vision. Some Wall Street analysts have pointed out that even if Trump’s aides are not moving forward with a Mar-a-Lago accord now, the administration could seek a currency agreement later. Trump’s goal to revive domestic manufacturing might be impossible just by having other countries lower their tariffs on US exports, raising the possibility that Miran’s broader program reemerges down the line. And while there are no signs of a global currency agreement, Trump’s aides are saying publicly that they are targeting countries they think have artificially devalued their currencies – reflecting one of the core ideas in Miran’s paper.

The document played a key role in Trump’s decision to elevate Miran to a senior White House role, according to two people familiar with the matter, who spoke on the condition of anonymity to reflect private deliberations.

Trump has shocked the world early in his term by imposing tariffs on hundreds of billions of imports from China, Mexico and Canada. These duties have already led to a downturn in the stock market and increased the odds of a US recession. The administration is currently moving forward with additional tariffs on trillions of dollars worth of imports on April 2, likely exacerbating the economic disruption. He announced car tariffs on Wednesday (US time).

“On the economic policy side, there’s just not a lot of foundational documents people can turn to for understanding the Trump administration’s intent. But a lot of people across the investment community are recognising that Miran’s paper gives a really good understanding of its basic policy and principles,” said Bob Elliott, chief executive officer and chief information officer of Unlimited, an investment firm. Miran’s paper “is providing a framework for how they are trying to reshape the global trading and finance order, even when it looks like a series of disconnected measures.”

Stephen Miran’s paper argues that unilateral tariffs may be necessary to force US trading partners to make changes.Credit: AP

But some observers think it’s farfetched to read deeper meaning into the paper.

Jesse Schreger, an economist at Columbia Business School whose work Miran cites, said the concept of a new currency accord is difficult to reconcile with the punishment Trump has inflicted on Mexico and Canada. The paper appears to lay the groundwork for co-ordinating action against China in particular, Schreger said. (Some Trump advisers have insisted the tariffs on Mexico and Canada are about drugs and immigration, not trade.)

“There’s a fundamental coherence to this. There is a plan laid out here. And because everyone is grasping for what is Trump doing, this is the document people are reading,” Schreger said. “But the problem is it’s not what the president is implementing. There’s nothing in there that says we should start by going after Canada and Mexico. Instead, the document emphasises building a coalition to co-ordinate trade efforts against China.”

‘Anyone thinking what I wrote in November is the policy agenda we’re secretly implementing right now is just looking for something to write about.’

Stephen Miran

Adam Tooze, an economic historian at Columbia University, referred to reaction to the paper as “sane-washing” – an attempt to impose rationality on decisions that are actually irrational.

It makes sense, Tooze writes, that many commentators want to believe Miran has articulated a playbook that explains Trump’s actions. Miran, 41, is a Harvard-trained economist who held a senior role in the Treasury Department in Trump’s first term and co-founded Amberwave Partners, an asset management firm.

“We are all struggling to find some kind of rational purchase on the unhinged situation created by the Trump administration,” Tooze wrote on his Substack. “None of us really knows where this clown car is headed and what drives it on its crazy course. It seems like a mystery even to many on board. Quite reasonably we look for elements of rationality.”

Other economists have raised additional objections to Miran’s argument.

Steve Kamin, with the centre-right American Enterprise Institute, said Miran overstates the downsides of a strong US dollar and underestimates the benefits. Even countries like Japan, which has a weak currency, have seen a sharp decline in manufacturing as a share of employment, as technological improvements have led to deindustrialisation across the developed world.

Some allies, however, remain optimistic that Miran’s paper could provide a road map for action.

Miran’s paper dovetails with much of the analysis articulated by former Trump adviser Bob Lighthizer and current US Trade Representative Jamieson Greer, as well as the president himself, said Daniel Kishi, policy adviser at American Compass, a conservative-leaning think tank. Getting other countries to let their currencies appreciate might require drastic measures, he said.

“Chaos can be valuable in negotiations,” Kishi said. Imposing tariffs on “Canada or Europe demonstrates a level of seriousness, where if you see they’re going to take it to allies maybe you should come to the table as well. Whether such a deal materialises in the months or years to come, we’ll have to see.”

The Washington Post

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