The Problems With Trump's Multi-Front Trade Fight: DealBook Briefing

Good Tuesday. Here’s what we’re watching:

• What happens after the imported metal tariff delay?

• Why C.E.O.s might need to be more outspoken on social issues.

• How the T-Mobile C.E.O.’s success might be a mixed blessing.

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The Trump administration is discovering the difficulty of fighting a multi-front war.

President Trump’s decision on Monday to hold off on imposing steel and aluminum tariffs on a number of countries came as the United States is engaged in a separate trade battle with China and is negotiating changes to the North American Free Trade Agreement.

From the time the tariffs on steel and aluminum were announced in late February, they seemed the least promising part of Mr. Trump’s combative trade policy. Not only were the measures directed in part at allies, the European Union and Canada among them, the administration convinced few with their argument that imports of the two metals were threatening national security.

And when announcing the tariffs, the Trump administration immediately granted temporary exemptions to certain countries. The move suggested loopholes and concessions might be available, an impression that will likely persist after Mr. Trump on Monday extended negotiations with Mexico, Canada and the European Union for 30 days.

The new deadline may help push along Nafta negotiations with Mexico and Canada, but the European Union is becoming a big problem for Mr. Trump’s trade agenda. The bloc has gained another reprieve from the steel and aluminum tariffs and apparently has given up nothing.

That has likely put the European Union in a stronger position, which it may now use in negotiations with the United States to end the tariffs threat. The bloc could use an opening to try forge a narrower version of the Transatlantic Trade and Investment Partnership. But such an outcome would take many months to finalize and probably would not look like a win for Mr. Trump’s “America First” agenda.

And the European Union’s stance has hurt Mr. Trump’s tariffs strategy in another crucial way. The tariffs were said to be a cudgel to persuade allies to back the United States in its trade actions against China. The European Union, which shares some of the United States’ frustrations with China’s trade practices, may eventually back Mr. Trump against China. But the longer the tensions between the European Union and the United States persist, the less likely it is that they align.

Indeed, the divide the tariffs created between the United States and its allies, and Mr. Trump’s willingness to delay them, may be strengthening China’s resolve. The country’s trade negotiators are preparing to reject two major demands of the United States, for instance.

Mr. Trump famously said trade wars are easy to win. But, as he is finding out, this is not the case when they are fought on three fronts at once.

— Peter Eavis

The E.U., Mexico and Canada got a reprieve. Now what?

With his administration delaying tariffs on steel and aluminum from those partners by another 30 days, President Trump has so far avoided starting a multinational trade war with key allies. But is there any progress toward a permanent accord with them?

And the delay poses a risk, per Ana Swanson of the NYT:

It could fuel criticism that Mr. Trump is more bark than bite and increase the pressure on the White House to squeeze concessions from other nations.

The E.U. is still demanding a permanent exemption, and said the extension “prolongs market uncertainty.”

Meanwhile, Beijing said it wouldn’t discuss two key trade demands — a $100 billion cut in the U.S.’s trade deficit with China and curbs on a $300 billion Chinese plan to invest in advanced tech like A.I. and electric cars — when a U.S. delegation arrives this week. Why: It now thinks it’s big enough to stand up to Washington.

And Alibaba’s vice chairman, Joe Tsai, told CNBC that he viewed the spat between the U.S. and China as just “a temporary blip.”

Customers want C.E.O.s more involved in social movements

Company chiefs increasingly wade into political issues like gun control and climate change. But a poll suggests they may not be moving fast enough.

From the latest Edelman Trust Barometer, which polled 33,000 people across 28 markets worldwide and will be released at the Milken Institute Global Conference this morning:

• 64 percent say C.E.O.s should lead change rather than waiting for government action.

• 56 percent “have no respect for C.E.O.s who remain silent on important issues.”

• All age groups expect C.E.O. to be personally visible in explaining a company’s purpose and vision.

Why John Legere’s success at T-Mobile is a mixed blessing

He took charge of a company with a doubtful future, after regulators had blocked a sale to one of his former employers, AT&T. And he turned it into a credible insurgent in the American wireless wars, with the money and power to buy Sprint for $26.5 billion. He also became the industry’s most colorful executive.

Yet Mr. Legere’s success might make the Sprint deal harder — because, as the research analyst Craig Moffett told Michael, it “proves that regulators’ opposition to the two companies’ effort to merge in 2014 was justified.”

Fear that the transaction would be blocked made yesterday Sprint shares’ worst day in a year.

Another fear, of Chinese dominance in 5G, provides a primary argument for the deal.

On AT&T and Time Warner: Their $85.4 billion merger plan is now in the hands of a federal judge.

The political flyaround

• Among Robert Mueller’s proposed questions for President Trump: What discussions did you have during the campaign regarding Russian sanctions? Why did you fire James Comey? What efforts were made to reach out to Mr. Flynn about seeking immunity or possible pardon? (NYT)

• Nearly 200 Democrats are suing Mr. Trump over payments to his companies from foreign governments. (Bloomberg)

• Paul Manafort is being sued, too, over a failed deal involving his former son-in-law. And he has asked the judge in his criminal case to investigate leaks of grand jury information.

Why WhatsApp’s co-founder is leaving Facebook

Jan Koum, an executive who also sat on Facebook’s board, had grown increasingly concerned about its collection of user data.

More from Elizabeth Dwoskin of the WaPo:

The independence and protection of its users’ data is a core tenet of WhatsApp that Koum and his co-founder, Brian Acton, promised to preserve when they sold their tiny start-up to Facebook. It doubled down on its pledge by adding encryption in 2016.

What will Mr. Koum do next? Spend more time with his car collection, for starters:

Elsewhere in Facebook: As the company’s F8 developer conference opens this week, some developers are rankled by sudden change to its privacy policies. “Facebook threw us under the bus,” one told the NYT.

Elsewhere in privacy: Your concerns probably reflect your politics. A demonstration against Moscow’s effort to block Telegram became a protest against Vladimir Putin.

The tech flyaround

• The California Supreme Court made it harder to classify workers as contractors, a blow to Uber and other start-ups. (NYT)

• Autonomy’s former financial chief was found guilty of fraud around its sale to Hewlett-Packard. (WSJ)

• Are hacked companies allowed to retaliate? (The New Yorker)

• The ride-hailing giant Didi Chuxing and Volkswagen are close to agreeing on a joint venture in China. (WSJ)

• And Didi’s battle with Meituan is escalating as they prepare to go public. (The Information)

• What happened when Airbnb took control of a Florida apartment complex. (Bloomberg)

Anthony Scaramucci is returning to SkyBridge

Before joining the Trump administration as communications director, he quit the investment firm, having struck a deal to sell it to HNA of China. But the White House job lasted 10 days, and now the deal with HNA is off, too, so he’ll come back as co-managing partner.

Why? Blame Cfius, the federal panel that reviews foreign takeovers of U.S. companies for national security concerns.

Elsewhere in deals:Boeing will buy KLX, which makes plane parts, for about $3.2 billion. Yesterday’s Merger Monday could net investment bankers $330 million in fees. Can Moelis & Company outlive Ken Moelis? Demand for the I.P.O. of Ping An’s health care unit is weaker than expected.

Ashley Judd’s new fight with Harvey Weinstein

She helped the investigations that took down the former movie mogul. Now she’s suing him for damaging her acting career, saying he spread lies after she rejected his sexual requests. (One movie she says she might otherwise have been in: “The Lord of the Rings.”)

Revolving door

• The American Petroleum Institute reportedly wants Mike Sommers, previously chief of staff to the former House Speaker John Boehner, as its next C.E.O. (Bloomberg)

• Charlie Kindel stepped down as the head of Amazon’s smart home division, saying he needed to “relax and goof off.” (The Information)

The speed read

• Blackstone is expanding in the nearly $300 billion U.S. market for subprime car loans. (FT)

• Panasonic agreed to pay $280 million in the U.S. to settle a bribery case, sending its shares down more than 2 percent. (FT)

• California is preparing for a fight over car emissions. (NYT)

• McKinsey is big in bankruptcy, yet discloses fewer potential conflicts of interest than other advisers. (WSJ)

• BP’s chief executive, Bob Dudley, fled Moscow in a former post because blood tests suggested he was being slowly poisoned, according to a former employee. (Telegraph)

• San Diego’s City Council is expected to vote on whether to let residents buy power in bulk, bypassing the local utility. (NYT)

• A new book, “Big Is Beautiful,” questions the virtues of small businesses. (NYT)

• Nearly 3,000 freelance journalists have won a $9 million settlement in a 17-year class action against big publishers. (NYT)

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