The world’s biggest powers were deep in a trade war. Economic losses from the tariffs that President Trump had imposed on most of the world, along with global retaliation, were accumulating. Jobs were being lost, inflation was ticking up and the world was both frustrated with and anxious about the United States.
While the stakes were real, the trade war was not. Instead, it was a simulation to better understand how a global trade fight might unfold.
Last month, two dozen trade experts from the United States and other countries gathered at a Washington think tank to try to simulate what could happen if Mr. Trump moves ahead with his plan to impose punishing tariffs on America’s biggest trading partners.
Teams representing China, Europe, the United States and other governments spent a day running between conference rooms, offering proposals to remove the tariffs and make trade deals to forestall economic collapse.
The game, which took place at the Center for a New American Security, a bipartisan think tank focused on security issues, included think tank experts and former officials in the Trump and Biden administrations. The exercise was not aimed at predicting the future. Instead, by acting out what might happen, the participants were trying to reveal some of the dynamics that might be at play as Mr. Trump pursues an aggressive trade approach against allies and adversaries alike.
In the last two months, Mr. Trump imposed tariffs on China, Canada and Mexico, as well as levies on global steel and aluminum imports. On Wednesday, Mr. Trump is expected to announce a plan to raise tariff rates on other countries, and his 25 percent tariffs on cars and auto parts will go into effect on Thursday.
Mr. Trump’s tariffs have already prompted China and Canada to retaliate with tariffs on U.S. goods, and other governments, including in Europe, are drawing up lists of American products to hit if Mr. Trump goes ahead with stiff levies.
The moves have increased U.S. tariffs to levels not seen since World War II and raised big questions about the future of global trade, including whether deals can be reached to forestall tariffs, and how tit-for-tat trade wars could unfold.
The game at the Center for a New American Security was an effort to explore how all these dynamics might play out. A game board situated on the conference table of the think tank’s board room showed the stakes. Little wooden cubes — green for good, yellow for bad, and red for terrible — were scattered around the board to keep track of how the simulated trade tensions were affecting public opinion, domestic security, international tensions, the economy and other factors in various parts of the world.
Just before lunch, the picture did not look good. The board held a sea of red cubes, indicating that the tariffs were escalating international tensions, destroying jobs and pushing up inflation.
But what happened next was surprising and, according to the participants, a hopeful sign.
Pushed to reach deals before the end of the day, the participants were able to move toward concessions.
By the end of the day, many of the red cubes had been removed. The team that represented Europe decided to drop some of its trade barriers in return for Mr. Trump taking off some of his tariffs. The United States lifted many of its tariffs on Canada and Mexico and ended up refreshing its trade deal.
Emily Kilcrease, a senior fellow at the think tank who played the part of Mr. Trump, said the game suggested that “there is a path to victory for a U.S. tariff-first policy.” She cautioned this would be true only if the United States focused on reaching bilateral trade agreements, a strategy she called “viable” but “high risk.”
Geoffrey Gertz, another senior fellow, said that the game emphasized America’s global dominance. Mr. Gertz said that China tried to peel off other governments, but everyone else “held China at bay to try to get a better deal with the U.S.”
“The U.S. is still very much in the driver’s seat, and when the U.S. acts everyone else has to respond,” Mr. Gertz said.
Some countries did take action to bypass the U.S. market. Canada invested in infrastructure at ports to trade with Mexico directly, for example. But most governments waited for the United States to engage.
Nazak Nikakhtar, a partner at the law firm Wiley Rein who is a former Trump administration official, played on the U.S. team and agreed. The game highlighted “how much Trump’s approach to trade has made every country’s priority dealing with the United States on trade issues,” she said, adding, “that was really remarkable.”
Tobias Gehrke, a senior fellow at the European Council on Foreign Relations, said that some European countries, like Spain and Italy, indicated that they might want to hedge against the United States by growing closer to China. But this time, Europe had stuck together.
“I think that shows there is light at the end of the tunnel,” he said. However, he added that this outcome would occur only if the United States actually wanted to reach trade deals and ultimately take down its tariffs. In the real world, it isn’t so clear in Europe whether Mr. Trump’s ultimate goal is a deal, he said, or simply to raise tariffs.
Other occurrences could have pushed the game off the rails. The players saw public opinion toward the United States sour in some countries. And they said that if the United States had taken more extreme courses of action — for example, pushing territorial claims in Canada or Greenland, as Mr. Trump has mused — other countries could lose the political will and ability to strike trade deals with the United States.
Ms. Kilcrease said there was also a “bandwidth question” with negotiating with the entire world at once. The U.S. team had ended up sprinting between rooms all day. “Can we actually do all this at the same time?”
“There is a possible world where the U.S. ends up doing well, but that is not preordained,” she concluded.