Today, President Trump imposed hundreds of billions of dollars in tariffs on the countries of the world, that vary enormously from nation to nation. He calls them “reciprocal” tariffs, but they aren’t reciprocal at all. Trump increased tariffs even on friendly countries that had lower tariffs than we do, which is the very opposite of reciprocity. He imposed 10% tariffs even on countries that we have a trade surplus with, like Australia — which has fewer trade barriers than America does, and has some of the lowest tariffs on Earth. Trump imposed a tariff of 31% or 32% on Switzerland, even though it “had eliminated industrial tariffs recently on all imports, including American goods,” as the New York Times notes.
Trump’s tariffs are kinder to countries that are mean to us than to countries that are kind to us. Protectionist Brazil, which has a left-wing president, was slapped with a mere 10% tariff, while America’s ally South Korea, which has a free-trade treaty with the U.S., was slapped with a harsh 25% tariff. Vietnam, 84% of whose people liked America, has been slapped with a harsh 46% tariff. That big tariff will undermine our foreign policy by making it harder to contain China by moving production from China to its neighbor, Vietnam. The European Union has been slapped with a 20% tariff, and Japan has been hit by a 24% tariff. But Iran, which has repeatedly taken Americans hostage, received a tariff of only 10%.
As journalist Josh Barro explains, “The tariffs are not reciprocal — the ‘reciprocal’ rates are based on trade deficits, not tariffs (or non-tariff trade barriers), *and* then tariffs are even imposed on countries with which we have a trade surplus. News outlets should not accept the ‘reciprocal’ branding.”
The tariffs also are imposed on territories that have done nothing to the U.S. “Trump’s tariffs target the uninhabited Heard and McDonald Islands,” notes Mike Baker of the New York Times. And Trump imposed a tariff increase on an island that contains a key U.S. military base. “He has introduced a 10% tariff on the British Indian Ocean Territory. The only inhabited island there is Diego Garcia, home to US service personnel. Trump has put a tariff on a U.S. military base.”
“Israel eliminated tariffs on US imports and Trump still slapped it with a 17% tariff,” notes Alex Nowrasteh of the Cato Institute. Heritage Foundation data shows “there are 68 countries with a higher Trade Freedom Score than the US,” but they got slapped with tariffs, too, despite having fewer trade barriers than America.
“American manufacturers say that the new tariffs will cost American manufacturing jobs, hurt their ability to compete,” as shown in a press release from the National Association of Manufacturers. It says “the high cost of new tariffs threaten investment, jobs, supply chains and, in turn, America’s ability to outcompete other nations and lead as the preeminent manufacturing superpower.” Tariffs that increase the cost of imported raw materials wipe out jobs in the auto industry and other manufacturing industries.
Trump’s tariff rates only took into account goods, not services that a foreign country buys from us, “so even though we run a massive services surplus with the world, that didn’t count when they calculated these imaginary ‘tariff rates,'” notes James Surowiecki of The Atlantic.
Economist Scott Lincicome says that “Trump’s reciprocal tariffs: 1) Impose hundreds of billions of dollars in new taxes on Americans without public/congressional input; 2) Are based on secret calculations that have little, if any, connection to actual foreign trade barriers; 3) Ignore all US tariff/non-tariff barriers, which in some cases are quite high; 4) Are justified by a “national emergency” that reflects a total misunderstanding of how trade deficits work; 5) Disregard US trade agreement commitments, including ones made by Trump himself; 6) Will make us all poorer, and likely do real & lasting harm to the US economy (incl in manufacturing); 7) Embolden our adversaries around the world.” Most “American manufacturers hate Trump’s tariffs,” Lincicome says.
Conservative economist Mark Perry hates the tariffs. “The effects of Trump’s tariffs? Lower economic growth, higher inflation, higher unemployment, the destruction of wealth, and a tax increase on American families. It will deal a blow to the rules underlying the global trading system and further empower China,” he says.
The public is mostly opposed to the tariffs. “The most surprising thing about the current trade wars is how little political constituency they have. Even the seeming obvious supporters (unions, manufacturers) tend to be against them. The trade wars are a project driven almost entirely by political elites,” says researcher Judge Glock.
The tariffs aren’t needed to keep good-paying manufacturing jobs. There are more auto factories in the U.S. now than in 2015, one illustration of how America did NOT deindustrialize and does NOT need big tariffs to compete with foreign producers.
America does have a shortage of skilled manufacturing workers, but that has nothing to do with a lack of tariffs, but rather, a woke educational system that fails to teach useful skills used in manufacturing. America’s misplaced educational priorities, not harmless trade treaties, are the biggest impediment to U.S. manufacturing. U.S. manufacturing output has grown, but the government’s bias in favor of college & against trade school harms manufacturing. As Mike Rowe of Dirty Jobs explains, “For every five tradespeople that retire this year, two replace them.”
Tariffs on raw materials and inputs wipe out jobs. Past tariffs on steel and aluminum “resulted in 75,000 fewer manufacturing jobs in firms where steel or aluminum are an input into production,” note two economics professors, by subjecting those firms to “increased costs of inputs” that made their products less competitive. That is far more than the paltry number of jobs gained in the U.S. steel industry due to tariffs on steel, only about “1,000 jobs.”
U.S. tariffs also trigger retaliatory tariffs from other countries. In response to Trump’s earlier, much more limited tariffs on metals, Europe imposed tariffs on $28 billion worth of U.S. goods, and Canada imposed tariffs on $21 billion worth of U.S. goods.
The tariff rates imposed by Trump made no sense. As The Atlantic‘s James Surowiecki notes, the Trump administration’s “fake” reciprocal tariff rates “didn’t actually calculate tariff rates + non-tariff barriers,” as you would do to calculate a reciprocal tariff. And “In calculating the tariff rate, Trump’s people only used the trade deficit in goods. So even though we run a trade surplus in services with the world, those exports don’t count as far as Trump is concerned.”
