Steel tariffs bring vindication for Trump's feisty trade advisor Peter Navarro

By Don LeeStaff Writer

March 11, 2018 6:55 PM PT

Reporting from Washington — Minutes before President Trump entered the White House Roosevelt Room on Thursday to announce sweeping tariffs on imported metals, the president’s economic A-team stood stone-faced near the president’s podium — but not Peter Navarro.

The 68-year-old former UC Irvine economics professor looked almost gleeful as he waited for Trump to issue final orders levying 25% duties on foreign steel and 10% on aluminum, all in the name of national security.

Trump’s move defied his own party and has infuriated U.S. allies. But the tariffs represent just the kind of shocking shake-up of the status quo on trade that Navarro has long advocated.

And in the last several weeks, perhaps no one has emerged as a more forceful public champion of the White House’s explosive new trade policy than Navarro, who has made multiple appearances on national television and other media to explain and defend the tariffs in his characteristically combative style.

“Let’s remember this,” he told “Fox News Sunday” host Chris Wallace a week ago. “Donald Trump ran against 16 Republicans. None of those Republicans supported Donald Trump’s positions on trade. He beat every one of them.”

Many lawmakers, businesses and economists believe the tariffs ultimately will hurt American consumers and the economy, while weakening relations with key allies such as Canada and the European Union. Trump’s National Economic Council director Gary Cohn resigned in protest last week.

For Navarro, who declined to be interviewed on the record, the tariff plan marks something of a personal vindication and another stunning turn in his brief stint in Washington and long career as an academic and wannabe politician.

A noted China hawk and onetime big fan of Hillary Clinton, Navarro volunteered on Trump’s campaign as an economic advisor (the only one with an economics PhD). And after Trump’s victory, the president named him head of a newly created National Trade Council.

Navarro gave up his tenured position in California, and an active life in sunny Laguna Beach, and came to Washington to run a small office and work on the president’s “Buy American, Hire American” agenda.

But within a few months, the trade council was dissolved, and Navarro found himself in a kind of White House purgatory. Though his work continued, access to the president was restricted as he was eclipsed by rival administration officials favoring more open-trade policies.

So-called globalists in the West Wing, led by Cohn, a former Goldman Sachs executive, had successfully tempered — or at least delayed — Trump’s protectionist and nationalistic moves.

But with battles over healthcare and taxes behind him, the president has been itching to push through hard-line measures on trade that he promised on the campaign trail, reportedly telling his staff, “Where are my steel tariffs?”

That provided an opening for Navarro.

Although the steel and aluminum tariffs followed a lengthy investigation by the Commerce Department, Navarro has persistently advocated for such actions, using what some said was guerrilla warfare to bypass Cohn to reach the president, a claim Navarro called a “cheap shot” on Fox News.

Over the years many people have rung alarm bells about the industrial decline in America, but Navarro has been at the forefront of linking the weakening of domestic manufacturing from global trade to the future of the country’s defense and national security.

That was the rationale Trump cited for the tariffs, although his later decision to exempt Canada and Mexico, as well as possibly others, is seen by scholars as undermining the legal basis for the restrictions and has been criticized as a tool for gaining economic leverage.

Trump elevated Navarro to the position of assistant to the president shortly before making the tariff announcement 10 days ago, allowing Navarro once again to report directly to Trump.

Now, there is speculation that Navarro is in the running to replace Cohn as head of the National Economic Council.

“If you’re of the mind-set you want somebody in there who has the Trumpian viewpoint on economies, he’s the right person for the job,” said Harry Kazianis, a friend of Navarro’s who directs defense studies at the Center for the National Interest. “Trump is going to want his own guy, somebody that he trusts and is on the same wavelength.”

Like Trump, Navarro is a newbie in Washington politics with unconventional views and a pugnacious style to match. Raised in the East Coast mostly by his mother, a Saks Fifth Avenue secretary, Navarro served in the Peace Corps in Thailand out of college and in 1986 earned a PhD in economics from Harvard University.

For the next three decades, Navarro made Southern California his home, first teaching in San Diego and then moving to UC Irvine until retiring from its business school last year. Early in his academic career he developed an expertise in public utilities and energy policy, and over the years his articles and dozen books have spanned a variety of subjects, including cyber-learning, investment strategies, and, of course, China’s rise and what he considers America’s biggest threat.

Along the way, Navarro ran for office three times as a Democrat. He lost each bid, including one in 1996 when then-First Lady Hillary Clinton came to San Diego, to Navarro’s great delight, to give a lift to his campaign for a seat in Congress. Navarro would later tell The Times that he was seduced by her charm and power.

Navarro’s thinking on trade has turned dramatically as well. Like many mainstream economists, he was at one time a believer in free trade and wrote extensively in support of such deals that he and his boss in the Oval Office are now trying to redo or dismantle, such as the North American Free Trade Agreement.

Nor was Navarro always a China basher. In an August 2016 interview, he said the turning point came in the early 2000s when he began to notice many people, including his own former students, struggling to get jobs. He came to the conclusion that their troubles, as well as other problems in the economy, could be traced to China. “All roads led to Beijing,” he said.

Many economists consider Navarro’s views as extreme and he has been marginalized by China academics. But one person who agrees with Navarro is Trump, who on the campaign trail accused China of “raping our country” and threatened to impose 45% tariffs on all Chinese imports.

Navarro is “the person who gives voice to the president’s gut instincts,” said Derek Scissors, a China expert at the American Enterprise Institute. With or without Navarro, the president was bound to act on the steel tariffs, Scissors said. Now Navarro’s resurgence in the White House, coupled with Cohn’s departure, will only reinforce Trump’s protectionist instincts, raising the risk of more stringent actions, he said.

“If the president seems like he’s too globalist a few months from now, then he would probably turn to Peter and say, ‘What can we do to remind people of “America First”?’ ”

That may involve China, as a pending case involving Chinese theft of intellectual property and forced technology transfers could prove even more consequential for the U.S. and global economy than the fallout from the steel and aluminum tariffs.

In a matter of weeks, Trump could decide to impose broad tariffs or restrict imports and investments from China, which almost certainly would escalate risks of a trade war.

That once again would thrust Navarro into the spotlight.

Navarro has been preparing for years for a U.S. confrontation with Beijing. His provocative books, such as “The Coming China Wars” and “Death by China: Confronting the Dragon — a Global Call to Action,” are widely viewed as polemical works. And his unorthodox — many would say faulty — analysis on trade deficits and the economy, as well as his acerbic style, have turned off many in his profession.

But Navarro’s supporters note that in recent years, more China experts have come closer to Navarro’s pessimistic take on the Asian nation as more threat than ally, as Beijing has backpedaled on promises to open up markets while also becoming more expansionary and assertive politically.

For Navarro, what matters inside the White House is that the president sides with him, his friends say.

“I think the president’s views on trade, his rhetoric on trade have been pretty consistent for a long time,” said Scott Paul, president of the Alliance for American Manufacturing, an advocacy group for whom Navarro wrote a chapter for a 2009 book.

“While [Trump’s] direct engagement on policy has waxed and waned on trade, I think his beliefs and his point of view have remained pretty steadfast, and Peter reflects that and is an implementer of that policy,” Paul said. “Eventually Navarro was going to win this argument because he agrees with Trump.”

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UPDATES:

6:55 p.m.: This article was updated with background on Navarro’s career.

This article was originally published at 3:20 p.m., March 10.