'Easily bamboozled' Trump could get owned by Mexico in trade war: Paul Krugman

Nobel Prize-winning economist and New York Times columnist Paul Krugman is seeing signs that President-elect Donald Trump may have already bitten off more than he can chew when it comes to his threats to launch trade wars with Mexico and Canada.

Writing on BlueSky, Krugman makes the case that Mexican President Claudia Sheinbaum appears to be ready to call Trump's bluff should he slap her country's products with 25 percent tariffs.

"One possibility re Trump tariffs that I don't think has been given enough consideration is that other leaders may decide that he's weak and easily bamboozled — and may be right (something already suggested by his behavior the first time)," Krugman asserts. "I mean, what just happened with Mexico? To use technical language, Sheinbaum's response to Trump's tariff threat appears to have been "F--k me? No, f--k you" (I spent many years in New Jersey)."

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Krugman adds that Sheinbaum after her call with Trump shot down his claims that she had offered him major concessions on immigration and on fentanyl, which led him to believe that she won't be a pushover in any dispute with the incoming president.

"Quite likely that other trading partners will respond similarly," Krugman speculates. "They probably realize, even if Trump doesn't, that America doesn't have a clear advantage in a potential trade war, especially if it's America against the world. And probably a good idea not even to give Trump symbolic concessions."