By Daniel Brouse
March 12, 2025
The Perterson Report released an analysis of the Trump steel and aluminum tariffs imposed during his first term that are very similar to the tariffs that went into effect today. In his last term, the result was a net loss of 75,000 manufacturing jobs and each job ‘saved’ cost taxpayers $900,000.
Key Findings: The Failure of Trump’s Previous Tariffs
During Trump’s first term, the administration imposed 25% tariffs on steel and 10% on aluminum under the justification of protecting American jobs and reducing reliance on foreign imports. However, the Peterson Report found that the policy was a net negative for the economy.
The Economic Damage of Trump’s First Tariffs:
- Net Loss of 75,000 U.S. Manufacturing Jobs – While a handful of domestic steel jobs were temporarily created, the broader manufacturing sector suffered significantly. Industries that rely on steel and aluminum, such as automotive production, construction, and appliance manufacturing, faced higher input costs, leading to layoffs and production cuts.
- Each Job Saved Cost Taxpayers $900,000 – The few jobs that were protected by tariffs came at an extraordinarily high cost, making it one of the least efficient job protection policies in U.S. history.
- Higher Prices for American Businesses and Consumers – U.S. companies had to pay 15-20% more for steel and aluminum compared to international competitors, leading to price increases for consumer goods, vehicles, and infrastructure projects.
- Decline in U.S. Exports Due to Retaliatory Tariffs – In response to Trump’s tariffs, major trading partners—including Canada, China, and the European Union—imposed their own retaliatory tariffs on U.S. goods. This particularly hurt the agriculture sector, leading to billions in lost revenue for American farmers.
- Stock Market and Business Uncertainty – The tariffs increased economic volatility, with markets reacting negatively to heightened trade tensions and uncertainty in key manufacturing industries.
Why the 2025 Tariffs Will Have an Even Worse Outcome
With Trump’s new 25% tariff on steel and aluminum, the economic consequences could be far worse than in 2018. Several key factors make the U.S. even more vulnerable to economic disruption today:
- Inflationary Pressures Are Already High – Unlike in 2018, inflation remains a major issue in the U.S. economy. These tariffs will further drive up prices for raw materials, worsening inflation for consumers and businesses.
- Global Supply Chains Are Still Recovering – Politics has already disrupted global trade, and adding tariffs now will further destabilize supply chains, making it harder for manufacturers to secure essential materials.
- Retaliation Will Hit Key U.S. Industries – The world has already signaled they will retaliate aggressively, likely targeting U.S. agricultural exports, manufacturing goods, and other key industries.
- Increased Risk of Economic Contraction – Economists warn that steep protectionist policies could push the U.S. into a manufacturing downturn, reducing GDP growth and weakening global investor confidence in the U.S. economy.
Final Thoughts: A Policy Repeating History’s Mistakes
Despite clear evidence from his first term that tariffs caused more harm than good, Trump is once again pursuing failed economic policies that drive up costs, eliminate jobs, and weaken the U.S. economy. The previous 25% steel and 10% aluminum tariffs proved to be a costly mistake, resulting in net job losses and higher consumer prices. Now, with new 25% tariffs on both, history is poised to repeat itself—only this time, the consequences could be even more severe.
If history is any indication, these tariffs won’t protect American jobs—they will destroy them.