[New York Diary]In the Unpredictable Trump Era, Fasten Your Seatbelt Tight

"While it was expected that President Donald Trump would begin his second term with tariff policies, the speed and scale have exceeded all predictions."

This is the assessment of a former aide who was responsible for trade policy at the United States Trade Representative (USTR) during Trump’s first term. Currently working at a major law firm in Washington D.C., he requested that our recent interview about Trump’s second-term trade policy be conducted off the record. He emphasized that Trump’s remarks on tariffs should never be taken lightly, and warned that every trade policy mentioned in campaign pledges or rallies would be implemented. Even he, however, found Trump’s all-out tariff offensive too swift and wide-ranging to evaluate on the record.

AP Yonhap News

The tariff war initiated by Trump is escalating. On April 2, a day he called 'Liberation Day,' Trump unleashed a barrage of reciprocal tariffs on all trading partners. South Korea was hit with a steep 25% tariff-the highest among countries with free trade agreements (FTA) with the United States. Japan, despite Prime Minister Shigeru Ishiba’s visit to the White House in February with lavish gifts to win Trump’s favor, faced a 24% tariff, similar to South Korea, which is currently experiencing a leadership vacuum. When it comes to tariffs, Trump recognizes neither allies nor adversaries. China was slapped with a 34% tariff, and Taiwan faced a similar rate of 32%.

Until now, Trump had touted the stock market as the primary indicator of his economic policy achievements. However, in his second term, he has shifted his stance. Despite the shock tariffs have caused to the stock market, he continues to send the message that short-term disruption and pain must be endured for the improvement of the U.S. economy. Tariffs have become a cheat code for Trump-not only to reduce trade deficits but also to revive manufacturing, increase tax revenue, and even address issues such as immigration and drugs. For Trump, tariffs are no longer just a tool; they have become a matter of conviction.

At this point, it is worth reflecting on whether Trump’s resolve has been underestimated. American trade experts interviewed before and after Trump’s election last year believed that renegotiation of the South Korea-U.S. FTA was very much on the table in his second term. This was a much more hawkish outlook than that of current and former Korean trade officials, who predicted that the main targets of Trump’s second term would be Mexico and Canada, making renegotiation of the Korea-U.S. FTA unlikely. However, in light of Trump’s recent indiscriminate tariff offensives, the warnings from U.S. experts are becoming a reality. In the Trump era, quite literally, every scenario is possible. Tami Overby, a prominent pro-Korea expert in the U.S. business community and former president of the American Chamber of Commerce in Korea, recently told this reporter, "Trump’s statements should never be dismissed," emphasizing that, "Before entering trade negotiations with Trump, who believes the U.S. is the victim, we must demonstrate sincerity by first addressing all tariff and non-tariff barriers."

With reciprocal tariffs now in effect, the time for negotiation has arrived. South Korea is starting from a much more disadvantageous position than initially feared. Depending on what kind of 'deal' is struck with Trump, tariffs could either become a bargaining chip for the United States or a bill that South Korea will have to pay in full. Trade is not the only issue. Even if the tariff dispute is resolved, the burden of increased defense cost-sharing for U.S. troops stationed in Korea and the North Korean nuclear issue still await. In particular, Trump’s recent reference to North Korean leader Kim Jong Un as a 'nuclear power' cannot be taken lightly. If Trump bypasses South Korea and effectively recognizes North Korea as a nuclear state, it could have devastating consequences for security on the Korean Peninsula.

With the Constitutional Court upholding the impeachment of former President Yoon Suk-yeol, the leadership vacuum is expected to be resolved through a presidential election in early June. Although belated, summit diplomacy with the United States will be possible in two months. Now is the time to reexamine strategies for responding to Trump, taking even the worst-case scenarios into account. South Korea must refine its outreach to the United States and strengthen strategic alliances with countries that share interests in trade, diplomacy, and security. Relying on the notion of 'allies' or 'friendly nations,' or sticking to outdated negotiation frameworks, will make it difficult to navigate Trump risks that always exceed expectations. In this era where anything is possible under Trump, it is time to fasten our seatbelts and prepare for even the darkest scenarios.