Trump’s Whim Destroys Global Trade: Thailand, Cambodia Economic Pawns
This isn’t just about tariffs. It’s about the unraveling of a crucial bet that defined the post-war era: that global prosperity could be built on the stability of rules, the predictability of trade, and the long-term vision of multilateral institutions. Secretary Lutnick’s bragging on Fox News, relayed in “Khaosod,” about Trump’s late-night phone calls to Cambodia and Thailand, isn’t just an anecdote; it’s a symptom of a deeper rot. It reveals a process driven by instinct and leverage, turning international commerce into a high-stakes game of personal diplomacy.
It’s easy to get lost in the numerical theater — Thailand initially facing 36% tariffs, before landing…somewhere else. But what does a number mean when the system behind it operates on the principle of personal fiat? Are these rates reciprocal, or are they simply anchors, strategically inflated to create the illusion of a concession? This isn’t policy; it’s coercion, dressed up in the language of deal-making.
“I listened all day Saturday while he’s calling Cambodia, Thailand. What happens on Monday? They announce a truce. We made trade deals with Cambodia and Thailand today,”
The casualness with which this economic strong-arming is acknowledged is what’s truly unsettling. The “truce” itself suggests a state of conflict, where the threat of tariffs is wielded as an explicit weapon. It’s a stark departure from decades of painstaking, multilateral negotiations, replaced with a winner-take-all game governed by the shifting whims of a single individual. It suggests a world where the line between trade and geopolitical maneuvering is not just blurred, but erased entirely.
The United States, historically, has been the chief architect and defender of a rules-based international order. Think of the Bretton Woods institutions, the Marshall Plan, and even the WTO itself. Imperfect as these structures are, they were built to provide stability and a forum for dispute resolution, and to limit the very kind of unilateral action now being celebrated. This shift towards personalized deals risks undermining that legacy and creating a fragmented world of bilateral bartering where power, not principle, becomes the defining currency.
Pichai Chunhavajira’s insistence that Thailand’s negotiating team stood firm is understandable, but almost tragically beside the point. As Douglas Irwin, the Dartmouth economic historian, has shown, from the Smoot-Hawley Tariff to the steel tariffs of the early 2000s, US tariff policy has always been susceptible to the currents of domestic politics and presidential prerogative. Pichai’s reference to “deep analysis for national benefit” feels almost quaint when placed against the reality of midnight phone calls that determine trade policy.
The long-term implications here are far-reaching. Businesses will hesitate to invest in nations vulnerable to sudden market access restrictions. Global supply chains, already strained, will become even more precarious. Small and medium-sized enterprises will struggle to navigate the terrain. And as Harvard’s Dani Rodrik has consistently argued, the instability created by such unpredictable trade policies exacerbates inequality, disproportionately harming the most vulnerable segments of society, who rely on the stability of the established supply chains.
These agreements being constructed on a whim today will have consequences that reverberate for decades. But the real danger isn’t any single deal. It’s the slow, corrosive dismantling of a system of international cooperation built over generations. It’s the triumph of short-term power over long-term stability, and the hollowing-out of the very institutions that once underpinned globalization. The chilling effect on economic cooperation, on the very idea of fair trade itself, should worry us all—and not just as consumers, but as citizens of a world increasingly defined by unpredictability and the assertion of naked power.
