Trump Trade War Confounds CEOs, Deepening Economic Unease

By Jeff Stein, Isaac Arnsdorf / The Washington Post

13:55 JST, March 12, 2025

U.S. President Donald Trump faced more than 100 top business leaders Tuesday, as executives plead for market stability and his trade war shook confidence in the U.S. economy. Instead he offered more of the uncertainty that has rattled stock markets by suggesting tariffs could exceed 25 percent.

“They don’t want to pay 25 percent or whatever it may be,” Trump said of companies that import goods to the United States, at a meeting of the Business Roundtable, whose board members include Chuck Robbins of Cisco, Tim Cook of Apple and Jamie Dimon of JPMorgan Chase. “It may go up higher. Look, the higher it goes, the more likely it is they’re going to build” domestic plants.

Trump’s steep and variable import duties have sparked broad unease on Wall Street, though most executives have refrained from criticizing the White House publicly. Reporters were ejected from the meeting after the first question, though, in a change from the initial schedule.

The deepening sense that Trump is serious about using sweeping tariffs to alter the global economy – which many business leaders and Wall Street officials had hoped would prove campaign bluster – led to a steep sell-off in the stock market over the past week, which continued into early afternoon Tuesday. Through his first few weeks, Trump has implemented tariffs on more goods than he did over his entire first term, with roughly $1 trillion subject to import duties so far.

Trump showed no sign of softening on Tuesday, doubling tariffs on Canadian steel and aluminum – before backtracking after a conciliatory call from an Ontario official, in another of the rapid reversals that have contributed to unease on Wall Street. He also downplayed the market reaction and said he is committed to the policy for the long haul.

“Markets are going to go up and they’re going to go down, but you know what, we have to rebuild our country,” he told reporters Tuesday afternoon. “Long-term what I’m doing is making our country strong again.”

The unpredictability has rattled investors, who generally prefer stable economic policies to assess future earnings.

“On the business side, it’s paralysis that you don’t know how, whether or where, or how much to invest – that uncertainty is created by the tariffs and not understanding Trump’s intent. The uncertainty is just as bad as tariffs themselves from a growth perspective,” said Donald Schneider, who served as a top aide to Republicans on the House Ways and Means Committee and is now deputy head of U.S. policy at Piper Sandler.

Trump has offered little comfort to business leaders in recent days, saying he is not paying attention to the stock market while intensifying tariffs on U.S. trading partners even as Wall Street shudders. Last week, the president implemented 25 percent duties on the nation’s two biggest trading partners, Canada and Mexico, before paring those plans back so they don’t affect goods imported under the North America trade pact reached during his first term. He also added 10 percent to tariffs on all Chinese products last week, bringing the total tax on some imports from China to 45 percent.

“Business leaders, CEOs and COOs are nervous, bordering on unnerved, by the policies that are being implemented, how they’re being implemented and what the fallout is. There’s overwhelming uncertainty and increasing discomfort with how policy is being implemented,” said Mark Zandi, chief economist of Moody’s Analytics. “Nobody is saying that out loud, but everyone is saying that in private conversations.”

One U.S. bank executive, speaking on the condition of anonymity to reflect private deliberations, said it is clear that investment is stalling amid confusion about the ultimate outcome of Trump’s tariff policy.

White House press secretary Karoline Leavitt declined to say how far stocks would have to fall for Trump to reconsider his tariffs.

“If people are looking for certainty, they should look at the record of this president,” she said. She called the stock market drops “a snapshot of a moment in time” and echoed Trump that “we are in a period of transition.”

A White House official declined to specify how long that period would last.

The Business Roundtable routinely meets with presidents. But Tuesday’s session came at a moment of special anxiety for executives and investors struggling to assess the implications of Trump’s tariffs.

“There was a consensus that they needed to stress the need for a little bit less unpredictability,” said a lobbyist for one of the member companies, speaking on the condition of anonymity because they weren’t authorized to discuss the matter publicly. “How do you do that with this president?”