Ford Motor Co. gets wrecked by Trump's tariffs, and this is still only the beginning

If you were wondering when and how much Donald Trump's campaign of spin-the-wheel random tariffs would start to impact major U.S. industries, we're now some the answers. Ford Motor Company's earnings report was released at the turn of the month and the answers to those two questions, at least for it, are "right now" and "existentially."

Well, that's going to hurt. Trump's new taxes on U.S. importers erased nearly a billion dollars of Ford earnings in just three months, putting it in the red. And even that's only about half of the real damage done.

The automaker lost $36 million from April through June, compared with a profit of $1.8 billion a year earlier, even as sales rose 5 percent to $50.2 billion. [...]

Ford must pay tariffs even though it makes most of its vehicles in the United States because, like all carmakers, it uses imported parts and materials. Those include tariffs of 50 percent on imported steel and aluminum.

So American automobile manufacturer Ford is, as a result of Trump's tariffs, now losing All The Money. And in an apparent effort by Trump and minions to make their contempt for U.S. manufacturing as clear as possible, it comes as Trump cuts a new "deal" with Japan that's going to further pressure domestic production. By terms of the deal, importers of Japanese-built automobiles will pay a new (still absurdly high) 15% tariff—but that's still much less than what U.S. manufacturers are now paying.

The 15% tariff rate will apply to cars and car parts, meaning that Japanese automakers will be able to import vehicles from Japan cheaper than U.S. automakers, such as Ford and General Motors, can import vehicles from Mexico or Canada at a 25% rate. While Canada's tariff rate was recently raised to 35% for Canadian imports, goods that comply with the United States-Mexico-Canada Agreement, including most vehicles and auto parts, are exempt.

Further, not only does the trade deal with Japan lower the costs for their imports, but it only reduces the incentive for them to build more cars in the U.S. region. Adding insult to injury, U.S. automakers are also paying more for crucial components such as steel, aluminum, and copper because of the administration's tariffs on imported metals.

That note that most vehicles and auto parts are "exempt" from the tariffs is, the Ford earnings report shows, misleading. Even counting for all the exceptions, Ford still paid tariffs that amounted to the entirety of its profits. That's because Trump has slammed Canada and Mexico with especially high tariffs, part of his long-term pattern of abusing allies more than enemies.

Then there's those new tariffs on critical raw materials. Quick-what's the tariff on imported copper right now? It depends on when you're reading this. A week ago it was 50%. But as of several days ago it might be zero percent, and what it will be two weeks from today depends entirely on which television shows Trump sees and what dreams he has between now and then. He claims he's cut drug prices by 1,500%; at his current levels of incoherence, it's entirely possible he'll announce the new tariff rate is stag beetle emoji.

For all of the scrambling U.S. companies are doing to try to adjust their business operations to best satisfy Donald Trump's personal whims, the hard truth of it is there is no way for companies to make long-term business changes. All they can do is lick Trump's boots and hope to hell each storm passes before the losses become unsustainable.

Sherry House, Ford’s chief financial officer, expressed optimism that the Trump administration could take steps to reduce the impact. “The administration is aware of these multiple tariffs and is working with us to get this right,” she said during a conference call with reporters.

Carmakers have so far avoided passing on much of the cost of tariffs to consumers. They built as many cars as they could before tariffs took effect, and have absorbed some of the cost.

What's obvious at this point, and was obvious from the very damn beginning, everybody knows it, every talking head on television knew it from the first moment the first tariff was announced, is that there is no actual administration "economic" plan whatsoever. It doesn't exist. Trump continues to illegally impose random tariffs on random countries on random days and his gaggle of supposed economic advisers, chosen exclusively from the ranks of Americans willing to work for a plainly unfit felonious serial sex predator who staged a violent attempted coup against the government, drag themselves in front of the television cameras to invent some supposed vision behind it all.

It's a plan to boost U.S. manufacturing, they say—but U.S. manufacturing is getting slammed because they're the ones paying asinine and sky-high import taxes on raw materials. It's a plan to boost U.S.-native raw material production, but developing new mines is both expensive and takes years of planning and the tariff rates keep changing so often and so much that only the most idiotic companies would make such massive investments on the presumption that they won't change.

We're sticking it to foreign auto manufacturers, one of the talking heads will say—only to be proven a liar again after a new "deal" that puts those foreign manufacturers at an advantage compared to their U.S. counterparts.

Tariffs are certainly a way to remold and boost specific domestic industries in the medium-to-long term. Announcing that a new tariff will take effect five years from now, rather than tomorrow, gives the affected industry half a decade to plan out a structured response. Five years to build a new factory, to develop a new mine, or to upgrade existing facilities.

Announcing new, massive, economy-shaking tariffs that will go into effect tomorrow or next week or next month, though, is a Dr. Strangelove scenario. The point of imposing a doomsday tariff is that you need to tell everybody there's going to be a doomsday tariff—in advance. You need enough heads-up time for your targeted industries to act in accordance with the new doomsday tariffs.

Blowing the thing up before you've let anyone know it's even on the drawing board defeats the whole point of imposing the tariff to begin with. Nobody can plan for Thing You Just Farted Out; domestic manufacturing and international trade cannot make long-term strategic changes in reaction to semi-weekly Tariff Glitter Bombs.

At the core of all of this is a dynamic that I still don't understand. Trump, an obvious dementia victim with a God complex and an appetite for crookedness and exploitation that overwhelms every other sense, is still widely supported by the same wealthy American capitalists who are now getting their lunch eaten by everything the man actually does. Ford Motor Co. going from $1.8 billion in earnings to a net loss in year-to-year quarterlies is a big deal; the job numbers that caused Trump to fire the head job measurer and a dozen other indicators all suggest we're in for a nasty recession at best. None of these companies begging for their new mergers or new deregulations or other favors can expect an economic outlook that rises above "dismal" for the foreseeable future.

And still ... nothing. There's little indication in the major papers of the scope of the industrial-scale destruction. American billionaires are still making the trek to the Oval Office to present their destroyer with gold trinkets and implausible flattery. Companies, universities, law firms, Wall Street—all are scrambling to appease, despite it being evident to even the dullest observer that the Trump administration staff is wrecking the economy and the federal government's capacity to service it on purpose.

The only way to describe it is as a hostage situation. Donald Trump is sitting in the Oval Office, angry and pantsless and waving a loaded gun around, and every lawmaker and executive in America is stuck in the room with him.

But there are an army of them! Taking the gun away from one insane raving man would be easy for the group—if they all agreed to do it. Trump gets disarmed, is sent to a nice farm upstate, and every elected official and insufferable moneyblob in America can get on with fleecing the rest of us good and hard without having to worry about how to best lick Trump's boots on any particular morning.

So I think that's where we're stuck. Getting out of this predicament means acknowledging that Trump is unfit—you can say it's because of his sexual assaults, or his felonies, or his sedition, or his dementia, or his brazen corruption, and he could be impeached tomorrow. But that would require at least a little courage from Wall Street, from the fleecing-people classes, and from the talking heads you see on your television sets, and all of those people have been genetically engineered to be the most gutless outright cowards the nation could produce.

So there's no pressure on Republican lawmakers to end this madness. No angry notes telling Mike Johnson, or John Thune, or any of the rest of them that if they don't get their loose dog under control they can kiss their fundraising efforts goodbye.

Jeff Bezos would rather lick the grime from between Trump's toes from now until death than risk a temporary disruption to his personal space program. The Wall Street kleptocrats who have for decades dumped money into Republican coffers for the sake of undoing whatever safety or environmental regulation they believe to be costing them a tenth of a percent of income, they'll all boast of their genes and intelligence and courage for as long as you'll let them, in media interviews—but to a person, if even the secretary of the secretary of Stephen Miller's third secretary calls them up to demand a new concession, they'll squeak in fear and agree to all of it.

Our problem isn't that Donald Trump is on his way to engineering a worldwide economic collapse in between his daily bribe-seeking sessions. Our problem is that we've made domestic American power largely dependent on being an equally obtuse and crooked idiot, and sooner or later you had to figure that decision was going to catch up to us.