Brazil Bites Back, As Tariffs Fail to Impress

US consumers will pay for Trump's Fondness for Dictators

The Big Beautiful Budget Bill is the law, and the President’s main task for Congress is to scheme on how not to lose seats in the 2026 election. Expect lots of theater related to MAGA priorities.

The administration has doubled down on actions largely designed to attack its enemies, ranging from the Fed chairman who refuses to buy in on an increasingly manipulated view of the economy, to farmers in Ventura County who can’t seem to find enough Medicare recipients to harvest their crops, to any country stupid enough to expect stability in trade agreements.

In the latest version of the Truth Is Whatever the President Says It Is, Trump sent poorly written letters to various countries this week telling them that August 1 is the deadline for tariff hikes. He claimed that date had been the deadline all along, despite having signed a published executive order changing the date from July 9th.

Via Stephen Robinson at Public Notice:

• The letters all read mostly the same, like shockingly incoherent spam e-mails with the recipient’s name in an obviously different font. They are filled with alarming typos, random Capitalization, and sloppy errors. For instance, Trump’s letter to Željka Cvijanović, the chairwoman of the presidency of Bosnia and Herzegovina, begins with “Dear Mr. President.”

• The letters double down on Trump’s bizarre belief that other nations are taking advantage of the US because we run a trade deficit with them. But as even Republican Rand Paul pointed out, the average American runs a trade deficit with their local grocery store. That’s a good thing. It’s how free trade works.

Mostly Trump said take it or leave it, because the cash flow from tariffs is now needed to plug holes in the federal budget left by his budget bill. Ninety deals in 90 days have now turned into pieces of paper highlighting other countries' supposed victimization of the US.

The letter to Brazil is a brazen attempt to wield an imagined trade deficit to impose Trump’s will on that country’s domestic policies. Since ALL CAPS demands on social media have failed to do the job, the President will be imposing a 50% tariff on imports unless Brazil frees its most notorious criminal.

Not that it matters, but as Paul Krugman pointed out, the President’s power to impose tariffs is limited to specific emergencies, none of which apply to Brazil. So, in addition to being stupid, those tariffs are illegal. Not that the Supreme Court will care…

Brazilian President Luiz Inácio Lula da Silva, known mononymously as Lula, has instructed the government to not accept and return the letter to the White House.

Donald J Trump has picked an honor fight that he can’t win. The object of his affections is former Brazilian President Jair Bolsonaro. He’s a former President because the Brazilian people turned thumbs down on his right wing nationalist agenda after one term, making ‘Trump of the Tropics’ the first incumbent Brazilian president in more than 30 years not to be reelected.

Hang on, folks. Check out this likely made-for-Netflix movie before it gets made.

Things got nasty after the 2022 election at a greater scale than occurred after Trump’s defeat in 2020. The loser in Brazil was nowhere to be found when it came time to inaugurate the winner.

Via The New Yorker:

• Rather than observing the custom of handing the sash of office to the new President, Bolsonaro had flown to Florida, where he remained for three seemingly aimless months, meandering through Orlando malls and taking selfies with Brazilian expats.

Via Britannica.com:

• On January 8, 2023, roughly a week after Lula’s inauguration as president, thousands of Bolsonaro’s supporters broke into the buildings that house Brazil’s Congress and Supreme Court as well as into the presidential palace, unleashing chaos and destruction in scenes similar to those enacted in the January 6 U.S. Capitol attack.

• In November 2024 Bolsonaro was one of more than three dozen people indicted in connection with an alleged conspiracy to overturn the results of the 2022 election. In a report that spanned nearly 900 pages, investigators detailed an audacious plot that involved the assassination of Lula, Lula’s vice presidential running mate, and a Supreme Court justice. Bolsonaro would then have been able to declare a “state of siege” and suspend the other branches of government while remaining in power as a caretaker president.

While Donald Trump was able to play at the margins of the US judicial system to avoid prosecution for his attempts to overturn the 2020 election, things haven’t been looking good for Bolsonaro. His country’s Supreme Court has ruled that the former president must face trial.

He spent two nights in the Hungarian Embassy in Brazil last year after police searched his home and seized his passport. Many people believed Bolsonaro had sought to use his ties with a fellow right-wing leader as leverage to evade possible arrest.

Officials with Brazil Federal Supreme Court are saying publicly that President Donald Trump is creating the conditions for the former President to flee Brazil to avoid being jailed.

Brazil has a judiciary that remains independent of the executive branch, so Lula couldn’t comply with Trump’s demand without violating his own oath to uphold that country’s constitution.

What makes Trump’s demands ridiculous is that Brazil has a running trade surplus ($74.5 billion in 2024) with the US. The South American nation is the world's largest coffee, orange juice and sugar grower, exporting about a third of coffee and half the orange juice sold in the US.

It’s probable that US coffee processors will find beans elsewhere, but even those countries will be subject to increased tariffs. The bottom line here is that Trump’s decree/threat will cause the price of a cuppa joe substantially. And beef. And –surprise!– crude oil.

If there’s one near ubiquitous domestic consumer demand in the US, it’s coffee. Wait until Starbucks’* customers start paying $10 for brewed coffee and see what happens.

*Starbucks operates over 40,000 stores across 88 markets, employs an estimated 361,000 people, and its sales represent 30.4% of the total industry revenue in its category.

Brazil’s response to the threat of increased tariffs has demonstrated their economic power. The country will respond with reciprocal tariffs, which means US-Brazil tariffs will ratchet up in 50% increments until all trade stops. Brazil has suspended intellectual property agreements with the US. Which means if you own a brand, it is no longer protected in Brazil.

Brazilian President Lula just happens to be on a four-day official state visit to China (their largest trading partner), attending a high-profile forum in Beijing along with other Latin American and Caribbean officials, including Chile's President Gabriel Boric and Colombia's President Gustavo Petro. On Tuesday, Chinese President Xi and Lula looked on as 20 agricultural agreements were signed, including several highly-anticipated deals.

A joint statement was issued in Beijing, with both countries pledging to firmly reject unilateralism, protectionism, and “actors who behave like bullies.” Hmmmm. Wonder who they were thinking of?

What Trump is attempting to do with Brazil is what he did to Canada, namely start a fight with zero leverage, rally a nation against the US and rescue a struggling national political leader. All gaining Americans exactly nothing.

Remember the August 1 deadline set by Trump, because if there was ever a TACO (Trump Always Chickens Out) opportunity, this is it.

FBI, DoJ, CIA Political Purges Create Security Nightmare by Jeff Stein at SpyTalk

• The purge is full on at the FBI, where career officials are being strapped up to polygraph machines and queried about their loyalty to Director Kash Patel and his sidekick, rightwing firebrand Dan Bongino.

• “The moves, former bureau officials say, are politically charged and highly inappropriate, underscoring what they describe as an alarming quest for fealty at the F.B.I., where there is little tolerance for dissent,” The New York Times also reported Thursday. “Disparaging Mr. Patel or his deputy, Dan Bongino, former officials say, could cost people their job.”

• This latest news comes in the heels of earlier high level purges of anyone connected to the Trump-Russia investigations, prosecutions of Jan. 6 riot defendants, or Diversity, Equity and Inclusion (DEI) programs.

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DHS Tells Police That Common Protest Activities Are ‘Violent Tactics’ by Dell Cameron at Wired

• At the same time, the guidance urges officers to consider a range of nonviolent behavior and common protest gear—like masks, flashlights, and cameras—as potential precursors to violence, telling officers to prepare “from the point of view of an adversary.”

• Protesters on bicycles, skateboards, or even “on foot” are framed as potential “scouts” conducting reconnaissance or searching for “items to be used as weapons.” Livestreaming is listed alongside “doxxing” as a “tactic” for “threatening” police. Online posters are cast as ideological recruiters—or as participants in “surveillance sharing.”

• One list of “violent tactics” shared by the Los Angeles–based Joint Regional Intelligence Center—part of a post-9/11 fusion network—includes both protesters’ attempts to avoid identification and efforts to identify police. The memo also alleges that face recognition, normally a tool of law enforcement, was used against officers.

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Surge in U.S. Concern About Immigration Has Abated by Lydia Saad at Gallup

• Meanwhile, support for allowing undocumented immigrants to become U.S. citizens has risen to 78%, up from 70% last year. This is also back to the level of support seen in 2019 (81%) while slightly lower than in 2016 (84%). Approval is higher still, albeit statistically unchanged, for offering individuals brought to the U.S. illegally as children a pathway to citizenship, with support holding above 80%.

• The declines in support for hiring more border agents (-17) and deporting all undocumented immigrants (-9) are mainly due to less support from independents and Democrats. Independents are also primarily responsible for the slip in support for expanding the construction of walls along the U.S.-Mexico border. Republicans’ support for each of these measures remains high.

• Meanwhile, the eight-point increase in support for giving immigrants living in the U.S. illegally the chance to become U.S. citizens reflects increased support from all party groups, with the biggest gain among Republicans (up 13 points to 59%).