President Donald Trump overruled the adamant objections of nearly his entire trade team when he ordered the imposition of 10% tariffs on China's remaining $300 billion of imports, according to The Wall Street Journal, citing people familiar with the matter.
Trump, in his decision announced Thursday on Twitter, said China has not made good on a promise to buy American agricultural goods in large quantities, and as a consequence the U.S. would impose the new tariffs starting Sept. 1.
The announcement sent the Dow and Treasury yields sharply lower.
Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer were in Shanghai last week in an effort to restart stalled trade talks. Trump and Chinese President Xi Jinping had agreed to a truce in the trade war on the sidelines of the June G-20 summit in Japan.
Trump wanted to give farmers, who have been hit hard by the trade war, guarantees that China was boosting its U.S. purchases as he prepared for a rally in Ohio. But Lighthizer and Mnuchin conveyed to the president in an Oval Office meeting that the Shanghai talks did not have the results that he wanted, according to the Journal's sources.
Trump ordered new tariffs in response. Virtually everyone present at the Oval Office meeting — including national security advisor John Bolton, economic advisor Larry Kudlow and acting chief of staff Mick Mulvaney — objected to his decision, according to the Journal. Only China hawk Peter Navarro did not object, it said.
A nearly two-hour debate ensued, but the president stood by his argument and eventually his advisors helped him draft a Twitter post on the new tariffs, the Journal reported.