But the 2020 election will soon come into play.
“President Trump has to start worrying about what this does to the economy as he approaches his re-election campaign,” said Petraeus, who analyzes geopolitical trends in his role as chairman of the KKR Global Institute.
Fitch Ratings warned that Trump’s proposal to raise tariffs on $200 billion of Chinese goods from 10% to 25% will damage the economy.
“American consumers will face higher prices and US jobs will be lost if the government’s threat becomes a reality,” Fitch Ratings wrote in a report on Thursday.
It’s unclear whether trade talks in Washington will be successful and forestall the threatened tariffs.
“I have no idea what’s going to happen,” Trump said on Thursday.
If trade talks drag out and tariffs ding the economy, that could pose a risk to Trump’s re-election campaign.
“He’s going to run on the economy. He’s made that very, very clear,” Petraeus said. “He constantly stresses how the market is doing under him.”
Petraeus said a “prolonged trade war” would put a “dent” in Trump’s ability to run on the economy.
“He will presumably start to feel some pressure to resolve this issue,” Petraeus said, “and show that the art of the deal is still present in his administration.”