Trump’s tariff tactics carry higher economic risks than during his first term When Donald Trump started the biggest trade war since the 1930s in his first term, his impulsive combination of threats and import taxes on U.S. trading partners created chaos, generated drama -- and drew criticism from mainstream economists who favor free trade.
If other countries retaliate against Trump’s tariffs with tariffs of their own – as China did and Canada and Mexico have threatened -- Trump will lash back with still more tariffs.
This time, by contrast, the tariffs are across the board – although the tariffs Trump had planned and then paused would have limited the levy on Canadian energy to 10%, showing that he was mindful of how much Americans in northern and midwestern states depend on oil and electricity from north of the border.
His plans to plaster tariffs of 25% on goods from Mexico and Canada and 10% on China – and to follow those up by targeting the European Union – would threaten growth, and push up prices in the United States, undermining his campaign pledge to eliminate the inflation that plagued President Joe Biden.
Trump on Monday paused the tariffs on Canada and Mexico for 30 days to allow more negotiations after those countries agreed to do more to stop the flow of illegal drugs and undocumented workers into the United States.
