In a Wednesday Truth Social post, President Donald Trump announced the second major alteration in U.S. tariff policy that markets have seen this month. This time around, the tariff formula is much simpler, and Trump singled out China as the foremost American adversary, alterations in line with some of the feedback received.

“Based on the lack of respect that China has shown to the World’s Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately,” Trump wrote. But, “based on the fact that more than 75 Countries have called Representatives of the United States … to negotiate a solution … and that these Countries have not, at my strong suggestion, retaliated … I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately.”

By the time of Trump’s announcement, stock markets had been tumbling for over a week. “Normally when investors are this scared they seek safety, and nothing is safer than the dollar and Treasury debt,” wrote The Wall Street Journal. In other words, normally bonds rise when stocks fall. But the original tariff announcement created so much fear among foreign investors — particularly Japan, which sold off lots of U.S. bonds — that the bond market also fell, creating a situation where the U.S. would have struggled to finance its debt.

The good news for Team Trump was that, as the president indicated, countries were lining up around the block to negotiate new trade deals and lower tariff rates — more than the Office of the U.S. Trade Representative could respond to all at once. Israel led the way, with Israeli Prime Minister Benjamin Netanyahu meeting Trump in the Oval Office on Monday, after Israel got hit with a 17% tariff. The notable exception to this conciliatory posture was China, which responded to Trump’s tariffs with higher tariffs of their own.

So, Trump on Wednesday moved to both address the economic jitters among investors and encourage the positive behavior from those countries seeking tariff reductions. After his announcement, the stock market rebounded 3,000 points, according to the New York Post.

Trump’s new tariff scheme treats China as an adversary while treating other countries differently. It’s noteworthy that Trump’s decision closely matches the recommendations made on Monday by David Bahnsen, founder and chief investment officer of The Bahnsen Group, on “Washington Watch.”

“I would have separated China from the rest of the world, I think, not only just politically,” he said. “There was already a little more acceptance that we’re dealing with something adversarial with China. And I think that the president did go about treating our friends and our foes the same. And I think that was personally a mistake, both economically and politically.”

National Review’s Jim Geraghty — no fan of tariffs in general — recognized similar virtues to Trump’s singling out China. 

Yet Trump’s new tariff announcement also undermines the position of one of his top advisors, Peter Navarro. Navarro is one of the few returning figures from the Trump administration. He proved his loyalty to the president by siding with him on the 2020 election, battling the National Archives instead of turning over records, and going to prison rather than comply with subpoenas from the Democrat-controlled U.S. House. Navarro is also a noteworthy proponent of tariffs, but that does not mean his vision of tariffs aligns with that of President Trump.

This week, Navarro insisted on Fox News’s “Sunday Morning Futures” that the tariff policy “is not a negotiation. This is a national emergency based on a trade deficit that’s gotten out of control because of cheating.” In particular, he pressed for tariffs as a means to address non-tariff policies adopted by other countries, “Don’t say you want to lower the tariffs and be done with it. … It’s the non-tariff cheating that matters the most.”

These remarks were out of tune with his boss, who described his tariff policy as “Reciprocal. That means they do it to us and we do it to them. Very simple. Can’t get any simpler than that.” (As I previously described regarding Israel, the first tranche of tariffs was not reciprocal by that definition, but it seems that White House staff produced numbers quite different from what Trump intended.)

Navarro had to know he was taking a risk by describing any policy decision made by Donald Trump as non-negotiable. The man is a walking negotiator. (I reserve judgment on Trump’s skill in negotiation, but he clearly enjoys negotiation and seeks to present himself as an expert. Trump’s true genius lies in marketing, and decades ago he chose to market himself as a negotiator by publishing a book titled, “The Art of the Deal.”) Navarro may have been promoting his own vision on trade policy, but President Trump’s vision is the one that matters; in the end, Trump chose to negotiate.

In fact, these missteps seem to have contributed to Navarro losing influence in the administration’s trade policy. The New York Post noticed that “It was [U.S. Treasury Secretary Scott] Bessent, not [U.S. Commerce Secretary Howard] Lutnick or Navarro, who held a press conference Wednesday saying our trade war with the world — except a hyper-belligerent China — was over, or at least on pause.”

Other reporting has reinforced this observation. On Thursday, Politico cited three anonymous “people close to the White House” (more leakers?!), to announce that “former hedge fund manager and Treasury Secretary Scott Bessent — the White House’s main conduit to beleaguered financial markets — is now at the helm, with populist Peter Navarro relegated to the sidelines and Wall Street punching bag Howard Lutnick recast into the role of ‘bad cop.’” On Friday, a headline in The Hill concurred, informing readers, “Bessent moves to center of Trump World.”

The headline here is that Trump demonstrated his ability to listen to and follow advice, backing U.S. financial markets away from potential collapse. It’s no guarantee that proud powerful men will listen to the counsel of others. In fact, this is so common that Solomon describes, almost as a stereotype, “an old and foolish king who no longer knew how to take advice” (Ecclesiastes 4:13). There are likely times when Trump also fails to heed wise counsel.

But here, Trump did heed good advice, and America is likely better off for it. “Where there is no guidance, a people falls, but in an abundance of counselors there is safety” (Proverbs 11:14).