One spring afternoon in 2019, I sat on a couch in the Oval Office as Donald Trump raged about the southern border and demanded we seal it entirely. His son-in-law Jared Kushner gently explained that closing a port of entry wouldn’t stop migrant crossings – people would simply go around it – and that the only real casualties would be American businesses.
“Jared, I don’t care,” the US President snapped. “That’s not the point! The point is, it will make Mexico hurt.”
Trump has a theory about leverage. His leadership philosophy – in a nutshell – is that threats are worthless and that you must damage someone else first if you want to get them to come to the negotiating table. Whether the damage accomplishes anything is irrelevant. Whether the target is an enemy or a neighbour is irrelevant. The pain is the point.
This is hardly what I’d call the “art” of the deal. This is junk art. Trump has brought all of the aggression of a hothead negotiator onto the world stage, secured nothing, and put the costs onto billions of innocent people while doing irreparable damage to his own side.
The problem with the Trump theory of leverage is that there is no scenario in which his opponent simply refuses. Now he’s stuck and dragging the world deeper into the aftermath of his ego-driven mistakes. His winning doctrine is backfiring badly in Iran – and now he’s run the same gimmick against a close ally in Canada – where it failed even faster.
Remember, nobody asked for this fight. Canada is the neighbour, top customer and co-signatory of a trade agreement that Trump negotiated in his first term. But Trump came back into office wanting “better” deals and slapped immediate and harsh tariffs on Canada, confident the country would settle with him.
Instead, he drove Canada into the arms of other nations. When Ottawa opened trade negotiations with China as a pressure-release valve for worsening economic relations with the United States, Trump ratcheted up his threats further, warning about a 100 per cent tax on all Canadian goods. The Canadians returned to the negotiating table, and last week, the President declared a deal done.
Then, in the final hours before a midnight deadline, Trump’s negotiators slipped in poison-pill language restricting Canada’s ability to strike trade agreements with other countries. The deal blew up. Ottawa baulked, and Canadian Prime Minister Mark Carney called the terms unfair and uneconomic. Now, the two nations are arguably at the lowest point in their 150-year relationship.
“You’re at war when you get attacked,” Carney told his country the next morning. “We got attacked.”
Yet again Trump tried to bring his “business” logic into foreign policy and it failed catastrophically. His negotiators effectively injected a “non-compete” clause into the deal, barring Canada from dealing with anybody else. That’s the type of clause you write when you have assumed, as an article of faith, that the other party has nowhere else to go.
Trump tried to bring his ‘business’ logic into foreign policy and it failed catastrophically, writes Taylor (Photo: Jonathan Ernst/Reuters)Trump’s settlement logic assumes his opponents have no alternatives. Once again, perhaps that was the case when he was building casinos. But countries do have alternatives. Iran has powerful patrons in Russia and China while Canada has an entire planet of buyers for its critical minerals, not to mention a Prime Minister who spent years arguing that “middle powers” like Canada must be willing to absorb pain rather than submit to economic coercion. Trump handed him the perfect opportunity to prove it.
Trump once explained to me and several other aides sitting in the Oval Office the lesson that he said had made him rich. In fact, he said it was the most important lesson he’d learned in business.
“When you threaten to sue somebody, they don’t do anything,” he told us. “They say ‘Pshhhh!'” He waved a hand in the air, dismissively. “And they keep doing what they want. But when you sue them, they go ‘Ooooh!’ and they settle. It’s as easy as that.”
Maybe it worked in the real estate business. But right now, in US foreign policy, the approach is leading to one catastrophe after another.
I’ve repeated that story many times because I think it’s the key to understanding the man and his perpetual (and perpetually reckless) quest for leverage. This week, we’re watching him “sue” two would-be defendants on the world stage — one an adversary, one a close friend — yet they’ve declined to settle.
An anti-Trump protest at Toronto City Hall (Photo: Steve Russell/Getty)Iran is the purest expression of the doctrine. The President did not slide into that war through a long chain of miscalculation. He filed the lawsuit, so to speak. He believed that sufficient opening damage would produce a favourable negotiation and, evidently, that a country on the receiving end of American firepower would do what a contractor in Queens does when the lawsuit papers land on his desk.
Tehran did not settle. So the President has done the only thing his doctrine allows for, which is to escalate further. His administration is now promising an “ECONOMIC D-DAY” and dispatching his Treasury Secretary Scott Bessent to assemble a sweeping sanctions package. While this is presented as strategy, don’t be fooled. It’s the flailing last resort of an administration that realises its blunder, is running out of weapons, and can’t find a way out of a conflict that Trump said would last days or weeks.
There’s one more aspect to Trump’s “sue-settle” lawsuit logic that has failed to translate into his job as leader of the free world. You can drop a lawsuit. You can walk into court, file a voluntary dismissal, and the matter goes away. There’s no voluntary dismissal for a war, the bombing kind or a trade war. Trump has filed two cases he cannot win or withdraw from, and predictably, both situations are getting worse.
Also, unlike junk litigation, the consequences aren’t isolated to Trump and his defendants. Everyone suffers from this. Everything is getting more expensive. In the wake of the Iran war, oil prices have soared, thereby raising the cost of goods globally on anything that requires a boat, bus, or plane to get it to where it’s going. And now the fight with Canada risks disrupting global supply chains and sparking further inflationary pressure on goods.
Americans get the worst deal of all. Canada will begin redirecting critical minerals and energy to other buyers, which means that resources which used to be almost exclusively sold to the United States will now get sold to US competitors, effectively at a discount. Simply put, Americans will pay more while the Chinese get the chance to shop at the clearance sale.
I’ve thought about his approach to suing adversaries a great deal since. The President was telling us exactly how he intended to operate. What was ostensibly a tale about “winning” in property litigation was really a preview of how Trump planned to detonate international relations with friends and foes alike. He would drop bombs and shut down economies with the stroke of a pen.
It’s as easy as that.
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