# Trump "Compels" Carmakers to Stay in the U.S.? **URL:** \ **Category:** Factual Questions\ **Created:** [January 24, 2017, 5:52pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050 "2017-01-24T17:52:58Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Frankenstein\_Monster](https://avatars.discourse-cdn.com/v4/letter/f/ccd318/32.png) [@Frankenstein\_Monster](https://boards.straightdope.com/u/Frankenstein_Monster)\ **Post date:** [January 24, 2017, 5:52pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/1 "2017-01-24T17:52:58Z")
I took out the GD component of this question. Just wondering about the GQ. Video title: [Trump Compels Carmakers to Stay in the U.S.](http://www.marketwatch.com/video/trump-compels-carmakers-to-stay-in-the-us/ACA64200-20F0-40AF-9057-420EF384150B.html) Video description: President Donald Trump met with auto executives at the White House Tuesday, promising to reduce unnecessary regulations and **warning them on moving business overseas.** (I didn’t watch that video, don’t know what’s in there) I’m mystified. What can Trump actually do to “compel” free-enterprise car manufacturers to rearrange their manufacturing arrangements? Only bluster and angry tweets? “Impose 35 percent tariffs on imported vehicles”? Can the executive branch do that? (My guess as to the answer: “Hahahahaha! No.”) Enact some other kind of impediment through executive action? Wouldn’t that be against WTO? NAFTA? What would be “realistically” possible (ignoring economic or political consequences)? ---
**Author:** ![Frankenstein\_Monster](https://avatars.discourse-cdn.com/v4/letter/f/ccd318/32.png) [@Frankenstein\_Monster](https://boards.straightdope.com/u/Frankenstein_Monster)\ **Post date:** [January 24, 2017, 6:04pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/2 "2017-01-24T18:04:22Z")
The only remotely comparable case I remember of executive action against imports is the [1980 Automobile VER](https://en.wikipedia.org/wiki/Voluntary_export_restraints). But that was a “voluntary” deal with a foreign government, against foreign manufacturers, and even that kind of deal is against WTO rules nowadays according to that link. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 24, 2017, 6:05pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/3 "2017-01-24T18:05:42Z")
> [@Frankenstein\_Monster](#): > > I took out the GD component of this question. Just wondering about the GQ. > > Video title: [Trump Compels Carmakers to Stay in the U.S.](http://www.marketwatch.com/video/trump-compels-carmakers-to-stay-in-the-us/ACA64200-20F0-40AF-9057-420EF384150B.html) > > Video description: President Donald Trump met with auto executives at the White House Tuesday, promising to reduce unnecessary regulations and **warning them on moving business overseas.** > > (I didn’t watch that video, don’t know what’s in there) > > I’m mystified. What can Trump actually do to “compel” free-enterprise car manufacturers to rearrange their manufacturing arrangements? > > Only bluster and angry tweets? > > “Impose 35 percent tariffs on imported vehicles”? Can the executive branch do that? (My guess as to the answer: “Hahahahaha! No.”) > > Enact some other kind of impediment through executive action? Wouldn’t that be against WTO? NAFTA? What would be “realistically” possible (ignoring economic or political consequences)? Executive actions have a lot of power. But since the GOP does have a slim majority in both Houses, Prez Trump should not have any major issues with Congressional support. ---
**Author:** ![Frankenstein\_Monster](https://avatars.discourse-cdn.com/v4/letter/f/ccd318/32.png) [@Frankenstein\_Monster](https://boards.straightdope.com/u/Frankenstein_Monster)\ **Post date:** [January 24, 2017, 6:12pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/4 "2017-01-24T18:12:35Z")
Thanks, **DrDeth**. I do wonder about (actually, I can’t imagine there’s) Congressional support for harsh action. But not sure if that’s worth the GD thread. What kind of power would Trump (roughly) have with executive action alone? ---
**Author:** ![Frankenstein\_Monster](https://avatars.discourse-cdn.com/v4/letter/f/ccd318/32.png) [@Frankenstein\_Monster](https://boards.straightdope.com/u/Frankenstein_Monster)\ **Post date:** [January 24, 2017, 6:30pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/5 "2017-01-24T18:30:15Z")
Sorry, I may have found my own answer. [President Trump Will Have Broad Presidential Authority to Terminate Trade Agreements and Impose Punitive Duties on U.S. Trading Partners](https://www.hoganlovells.com/en/publications/the-next-president-will-have-broad-authority-to-terminate-free-trade-agreements-and-impose-punitive-duties-on-foreign-countries) > [@](#): > > Under U.S. trade law, Congress has granted broad authority to the president to withdraw from trade agreements, impose additional duties on unfair trade practices, and designate currency manipulators. These steps do not require Congressional action or approval, as U.S. trade law vests broad authority in the president, without the checks and balances or legal constraints that exist under other trade procedures. [President Trump can levy tariffs without Congress](http://money.cnn.com/2017/01/23/news/economy/trump-tariff-power/) > [@](#): > > “A president who wants to restrict trade enjoys almost carte blanche authority,” says Gary Clyde Hufbauer, a trade expert at Peterson. Amazing. I guess I was wrong. ---
**Author:** ![Chefguy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chefguy/32/138_2.png) [@Chefguy](https://boards.straightdope.com/u/Chefguy)\ **Post date:** [January 24, 2017, 8:43pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/6 "2017-01-24T20:43:01Z")
I would imagine that Congress is going to have serious problems with tariffs on their donors’ products and may take action to restrict or abolish the ability of the president to levy same. Trump really needs to listen to the economists as to why this sort of arbitrary action is a bad idea. High tariffs mean fewer purchases, which means profit loss, which means dropping stock market. Is this really what he wants to happen? ---
**Author:** ![jz78817](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jz78817/32/1028_2.png) [@jz78817](https://boards.straightdope.com/u/jz78817)\ **Post date:** [January 24, 2017, 8:48pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/7 "2017-01-24T20:48:16Z")
> [@Chefguy](#): > > I would imagine that Congress is going to have serious problems with tariffs on their donors’ products and may take action to restrict or abolish the ability of the president to levy same. Trump really needs to listen to the economists as to why this sort of arbitrary action is a bad idea. High tariffs mean fewer purchases, which means profit loss, which means dropping stock market. Is this really what he wants to happen? I’m not sure he understands any of that. ---
**Author:** ![Just\_Asking\_Questions](https://avatars.discourse-cdn.com/v4/letter/j/ba9def/32.png) [@Just\_Asking\_Questions](https://boards.straightdope.com/u/Just_Asking_Questions)\ **Post date:** [January 24, 2017, 8:57pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/8 "2017-01-24T20:57:51Z")
I can see it now - a whole network of underground shipping. Cars manufactured in Mexico, or Canada, or wherever, being brought into this country in unmarked trucks, and dropped off at night and introduced into the factories as if they were made here. Bootleg cars! A thriving underground. Maybe we can have “speakeasy” garages for service? Or maybe the big three just say fuckit and close down domestic production, because the costs associated with said production (that caused foreign production to be so desirable in the first place) make American cars noncompetitive in the US, undercut by domestic-made foreign cars. Wonder if Donnie will like that? ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [January 24, 2017, 9:16pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/9 "2017-01-24T21:16:15Z")
But aren’t a lot of these things covered under treaties? Congress can’t just give the President power to ignore treaties, because nobody in the government (Congress included) has the power to ignore treaties. ---
**Author:** ![Frankenstein\_Monster](https://avatars.discourse-cdn.com/v4/letter/f/ccd318/32.png) [@Frankenstein\_Monster](https://boards.straightdope.com/u/Frankenstein_Monster)\ **Post date:** [January 24, 2017, 9:45pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/10 "2017-01-24T21:45:22Z")
I more or less assumed that WTO and NAFTA rules would forbid tariffs. Oddly I can’t find with quick Googling which U.S. WTO agreement a car tariff would violate. As for NAFTA I only found an [opinion piece](https://www.bloomberg.com/politics/articles/2017-01-04/trump-tariff-on-gm-would-violate-nafta-that-may-not-stop-him). > [@](#): > > Trade experts agree that presidents have wide latitude to impose penalties on imports, at least temporarily, even if courts later find them unlawful. > > Targeting a single company with a tariff as Trump threatened to do with GM in a tweet Tuesday is unheard of and **barred under the North American Free Trade Agreement** , according to trade experts. Punishing GM with a tariff on its Mexico-made cars – or any other U.S. company that has shifted production there – could prompt a Mexican response that would hurt U.S. exports and raise the price of all goods from the country. That’s muddled, if not a contradiction. If it’s barred, Mexico would just sue/appeal, and win? Would Mexico do that for GM? Would GM even be a party? The article gets only more muddled from there. ---
**Author:** ![Rick\_Kitchen](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/rick_kitchen/32/522_2.png) [@Rick\_Kitchen](https://boards.straightdope.com/u/Rick_Kitchen)\ **Post date:** [January 24, 2017, 9:53pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/11 "2017-01-24T21:53:31Z")
He’s already threatening Toyota (which is not even a US company) about manufacturing parts in Mexico. ---
**Author:** ![running\_coach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/running_coach/32/15836_2.png) [@running\_coach](https://boards.straightdope.com/u/running_coach)\ **Post date:** [January 24, 2017, 9:57pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/12 "2017-01-24T21:57:23Z")
> [@Rick\_Kitchen](#): > > He’s already threatening Toyota (which is not even a US company) about manufacturing parts in Mexico. But they sell here. I think the idea is he wants cars sold here to be built with 100% U.S. made parts. ---
**Author:** ![Frankenstein\_Monster](https://avatars.discourse-cdn.com/v4/letter/f/ccd318/32.png) [@Frankenstein\_Monster](https://boards.straightdope.com/u/Frankenstein_Monster)\ **Post date:** [January 24, 2017, 10:01pm UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/13 "2017-01-24T22:01:30Z")
> [@Rick\_Kitchen](#): > > He’s already threatening Toyota (which is not even a US company) about manufacturing parts in Mexico. Threatening with what? Is that a realistic threat? I’m still more interested in the GQ angle. ---
**Author:** ![Just\_Asking\_Questions](https://avatars.discourse-cdn.com/v4/letter/j/ba9def/32.png) [@Just\_Asking\_Questions](https://boards.straightdope.com/u/Just_Asking_Questions)\ **Post date:** [January 25, 2017, 2:25am UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/14 "2017-01-25T02:25:50Z")
> [@Frankenstein\_Monster](#): > > Threatening with what? Is that a realistic threat? I’m still more interested in the GQ angle. Me, too. And what happens if Japan, or whoever, returns the favor and raises their tarriffs, or prohibits US stuff from being sold there at all? What if no one decides to sell us critical raw materials? Does the Orange One think we’re just going to live in a bubble, totally self-sufficient? Cuz that won’t work. It’s also not sound business. ---
**Author:** ![China\_Guy](https://avatars.discourse-cdn.com/v4/letter/c/779978/32.png) [@China\_Guy](https://boards.straightdope.com/u/China_Guy)\ **Post date:** [January 25, 2017, 2:48am UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/15 "2017-01-25T02:48:38Z")
> [@running\_coach](#): > > But they sell here. I think the idea is he wants cars sold here to be built with 100% U.S. made parts. There is no such animal. At least not among the majors. All automakers use cat least some omponents not made in the US. ---
**Author:** ![running\_coach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/running_coach/32/15836_2.png) [@running\_coach](https://boards.straightdope.com/u/running_coach)\ **Post date:** [January 25, 2017, 2:52am UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/16 "2017-01-25T02:52:11Z")
> [@China\_Guy](#): > > There is no such animal. At least not among the majors. All automakers use cat least some omponents not made in the US. I know that. Try telling Trump that. ---
**Author:** ![rbroome](https://avatars.discourse-cdn.com/v4/letter/r/838e76/32.png) [@rbroome](https://boards.straightdope.com/u/rbroome)\ **Post date:** [January 25, 2017, 3:41am UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/17 "2017-01-25T03:41:10Z")
Given the length of time it would take for an American company to start manufacturing, say air bags, I can’t imagine anything approaching 100%. Even ignoring the various patents that would have to be sorted out. But I think we are continuing the fatal flaw of taking Trump literally but not seriously. He is going to make all these threats, get what he can get, declare victory and all his supporters will congratulate him for his success. While the rest of us stand in the dust saying but he said he would… He is a 50%+1 president. He isn’t interested in anything more than winning. ---
**Author:** ![AK84](https://avatars.discourse-cdn.com/v4/letter/a/85e7bf/32.png) [@AK84](https://boards.straightdope.com/u/AK84)\ **Post date:** [January 25, 2017, 3:48am UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/18 "2017-01-25T03:48:34Z")
All he is going to accomplish is to make cars more expensive for the American consumer. Unless he is ready to offer a subsidy. 1. Either a carmaker who is threatened with punitive tariffs for making cars in Mexico will say “fuck it” and sell that stock elsewhere, which means existing players can charge more. 2. Or they do move to the US, spending billions in the process. That money has to be recouped from somewhere; guess who is stuck with the bill. ---
**Author:** ![beowulff](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/beowulff/32/542_2.png) [@beowulff](https://boards.straightdope.com/u/beowulff)\ **Post date:** [January 25, 2017, 3:55am UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/19 "2017-01-25T03:55:35Z")
> [@rbroome](#): > > Given the length of time it would take for an American company to start manufacturing, say air bags, I can’t imagine anything approaching 100%. Even ignoring the various patents that would have to be sorted out. > > But I think we are continuing the fatal flaw of taking Trump literally but not seriously. He is going to make all these threats, get what he can get, declare victory and all his supporters will congratulate him for his success. While the rest of us stand in the dust saying but he said he would… > He is a 50%+1 president. He isn’t interested in anything more than winning. Actually, a large [percentage](http://www.autonews.com/article/20160110/OEM10/160119984/zf-trw-expects-to-become-no.-2-producer-of-airbag-inflators) of air bags are made in the US. ---
**Author:** ![Throatwarbler\_Mangrove](https://avatars.discourse-cdn.com/v4/letter/t/8c91f0/32.png) [@Throatwarbler\_Mangrove](https://boards.straightdope.com/u/Throatwarbler_Mangrove)\ **Post date:** [January 25, 2017, 4:18am UTC](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050/20 "2017-01-25T04:18:09Z")
> [@Just\_Asking\_Questions](#): > > Me, too. > > And what happens if Japan, or whoever, returns the favor and raises their tarriffs, or prohibits US stuff from being sold there at all? What if no one decides to sell us critical raw materials? Does the Orange One think we’re just going to live in a bubble, totally self-sufficient? Cuz that won’t work. It’s also not sound business. Japan and indeed most other big countries run trade surpluses with the US. If both sides decided to go into tit for tat tariffs, in theory the other countries would lose more, since they sell more to the US than vice versa. By threatening tariffs, other countries may be compelled to buy more from the US, in the form of reduced tariffs on US products, or something else. This should be good for everyone. Whatever other quarrels you have with his platform, I don’t think there’s anything unsound about Trump’s approach to trade, other than it being completely dependent on the autocratic whim of the president instead of something more systematic and predictable, but the president was properly and freely elected, which is a fine enough check on his power as anything else. He’s certainly not wrong that other countries run government directed trade policies that tend to increase their exports to the US while reducing the amount of goods imported from the US. Whether these policies or any Trump policies responding to this is an aggregate benefit or loss for either country isn’t as interesting as which interest groups (in both the US and the other country) are beneficiaries. For example the US happens to be an enormous exporter of luxury cars, especially to countries like China, although this isn’t something that turns up in the news much because the exported cars largely sport BMW and Mercedes badges, but the plants building those cars are no doubt quite influential amongst the Republican senators and representatives of Alabama and South Carolina. [Next page](https://boards.straightdope.com/t/trump-compels-carmakers-to-stay-in-the-u-s/778050.md?page=2)